Welcome back. I am Larry Biegelsen, the Medical Device Analyst at Wells Fargo, and it's my pleasure to host this session with the management team from Novocure. With us, we have Bill Doyle, Executive Chairman, and Ingrid Goldberg, Vice President of Finance and Investor Relations. In terms of format, it's gonna be a fireside chat. If anyone has a question, please raise your hand. Bill and Ingrid, thanks so much for being here.
It's our pleasure.
So Bill, I guess we should start with the news yesterday. Just maybe talk about the CEO transition, you know, why now? Do you expect any impact on strategy, and how might it impact your role?
Sure. So, you know, in many ways. So I serve as the Executive Chairman of Novocure, a position that I've held now for over 20 years, literally since we had three people in a basement in Israel. And for 22 of those years, Asaf Danziger has really been my partner. And, you know, very often, the executive chairman is a sort of a temporary babysitter for a CEO, as, you know, that person may prove him or herself. In our case, it was absolutely not. There was a, and is a huge amount of work to do, and we were in pure divide-and-conquer mode. And, you know, there was always more work.
And now that, you know, we're commercial in 16 countries, you know, the work. And we're on the threshold of becoming a multi indication oncology company, the work's multiplying. But I have to say, that work takes its toll. Asaf has literally been on the road every single week for 22 years, and about two years ago, he came to me and said, "Bill, you know, not today, not tomorrow, but, you know, we need to think about a transition." So that was the impetus, but I would say the other aspect of starting, growing, building a company is we were very fortunate and are very fortunate to have a very deep and talented bench. And, you know, the...
It's just the fact that when you have great people at that next level, if you don't create opportunities for them inside, they're gonna go outside, and so it was really the confluence of, you know, I think, having the real talent inside, and Asaf being at a point where he really needed to throttle back the travel, so we announced yesterday that Ashley Cordova, our current CFO, will become CEO at the end of the year. This is something that has been in the planning, as I said, for well over a year. I know that Asaf and I have been steadily broadening Ashley's responsibilities within the company. She's had finance, obviously, planning, all of the strategic levers.
She leads our ELT, executive leadership team, and so she's had, you know, that responsibility for some time. And, you know, Asaf and I have both taken her under our wings. You know, I don't know if that's the perfect metaphor here, but to broaden her into things like product development and regulatory, you know, just to mention two, where, which are functions that she hasn't had previously. We're also fortunate that, and I think this is one of the reasons why Asaf and I feel very comfortable with this transition now, is that the rest of our team is very strong.
So, you know, if I'm doing this from left to right in my head, but we made the transition for our Head of HR, Chief People Officer, about a year ago. Michael Puri is extremely strong. We made a transition with our Chief Medical Officer. Nicolas Leupin has proven to be extremely strong. We also announced the retirement of Wilco Groenhuysen after 12 years. Wilco was our COO. He actually started as our CFO, hired Ashley, moved over to the COO position when it became clear that Ashley was a superstar, and we made the room for her to become CFO.
He's 72, you know, just to put it in perspective, and so, you know, he was the same thing, "Okay, time for me to, you know, spend some time doing other things." And we had an incredibly strong head of product development, Mukund, who is going to continue to have that, but is gonna take on all the functions of operations. So we'll now have end-to-end product development through manufacturing and supply chain. It actually makes a lot of sense. So, you know, it's great to inject that new energy. You know, Asaf and I looked at each other yesterday, and, and, you know, Ashley's 20 years younger than we are. And that's good.
So I think we are exceptionally well-positioned at this, again, precipice threshold of this real phase of expansion to the company. Well, the last thing you said, my role, I'm not going anywhere, so I'm gonna remain Chairman of the Board. I'm gonna remain an Executive Chairman. The relationship between Ashley and me will be, is a little bit different, you know, because Asaf and I, you know, are on the phone three, four times a day. But I'm going to be in the picture to ensure that, you know, everything that I've learned in 24 years at this company is maintained and is brought to bear as we grow. But I feel like we could not be in better hands than we are with Ashley.
The CFO role?
So the CFO, that was the one we didn't feel we could fill internally. Now, clearly, Ashley, that's her department, so, but to have all the facets that we hope for, so that will be filled from the outside. And maybe one other thing I'll mention, you, as many of you may know, we're actually a Swiss-domiciled company. We did an opening day in Portsmouth, New Hampshire, just north of here yesterday for our U.S. flagship. Very exciting. We had the full New Hampshire Senate and Congressional delegation, the governor. It was a big day. But our global center of operations, center of gravity, is near Zurich. Ashley's moved to Switzerland. Uri Weinberg , who runs our research, is in Switzerland.
I mentioned Nicolas, who runs the clinical development, Chief Medical Officer in Switzerland. Michael's in Switzerland. So, we have a real new center of gravity together in Switzerland.
Got it. Okay, that's helpful. So, Bill, let's transition to the business and LUNAR for second-line non-small cell lung cancer. Can you give us an update on the filings in the U.S. and Europe? You know, what's the latest expectation there?
Yeah. So, simple answer here, nothing's changed since the, since our earnings call. You know, we expect approvals in U.S. and Europe, both by the end of the year. I think it's a coin toss, which will be first. At this point, we are ready to go, and we will launch in the U.S. and Germany when we have the appropriate approvals, but there's been no change since the earnings call.
No change to expectations for a broad label?
No changes at all.
U.S. people... You know, if you're in the final stages, people ask if you're in labeling discussions.
Yeah. I mean, we don't report the back and forth that we're having with any government regulators, but, as I said, there's just no change to our expectations.
The U.S. expectation was also second half?
Correct.
You're ready to go?
Yeah.
You know, talk about the launch plan and, you know, the day, you know, when you get approval.
Okay. So, again, obviously, we're a medical device. When we think about reimbursement, the reason that we go in Germany and the U.S. is these are markets that we can bill for on a named patient basis with approval, and so it takes longer. You have to go through the medical director of the payers to get paid, but we can get paid in these markets, and then with the approvals, we start the reimbursement process. The next two big markets are Japan and France. Those are single-payer markets where you cannot, you know, sort of bill in arrears, so we will start the process to get reimbursement in those two markets, but we will not launch in France and Japan until we have the approval.
The way we think about this, you know, new indication, new product, new group of customers, so these are the thoracic medical oncologists. The early focus is not going to be on numbers. You know, we think about the right patient, the right doctor, the right patient, the right experience. So, you know, I think in the balance of 2026, pardon me, the balance of 2024, early 2025, that's what we're gonna be focused on, are those positive first experiences with the clinicians, and then we'll push for broadening the penetration on that foundation.
When you launch, will you disclose, you know, the prescriptions and active patient numbers?
Yeah, I think it's too early for us to say exactly what we'll disclose, but we'll figure out a way to make it clear, you know, how things are going. Yeah.
You know, when we think about, you know, revenue per patient, how should we think about median treatment duration? Is four months still a reasonable place to start?
I think that was the duration that we saw in the clinical trial. GBM in the real world, it's longer than what we saw in the trial, but I would say, you know, anyone who's building a model, I think four months is a good place to start.
Remind us of why you still think there's a real market here for this.
Yeah. So what's the bear case? The bear case was that we did a trial in second line. It's actually second and third line, but in patients after platinum failure. Half the patients received tumor treating fields plus docetaxel chemotherapy, and half the patients received tumor treating fields plus Physician's Choice IO, so a PD-1 blocker. There was a trend in the chemo arm. The dramatic improvement was in the IO arm. And, you know, to put it in perspective, our data in second and third line are as good as Merck's data in the first line, so, you know, the two really work together. During the course of that trial, pembro went from second line to first line.
So the bear says, "Well, there's no patients." I think the real world, and what we're hearing is that's not true, that there is an increasing number, and I saw a number recently that was as high as 30% of non-small cell lung cancer, and the number I recall seeing earlier was, like, 15%, who are receiving IO in the second line. And those are the patients who, one, are seeking therapy clinicians are saying, "Hey, you're. I don't want to take your IO away, you know, I want to keep it going," and for whom it's going to be a natural to add our therapy on. So, you know, so I think we're getting credit for zero, and I think the opportunity is much bigger, for instance, than our GBM opportunity.
We have data that shows it's about 30%, 36% receive IO second line.
Okay, so you're even a little higher than what I'm seeing. Yeah.
The question, though, is: do you know if those patients all failed, will be on-label and pay, you know, get coverage? Because you don't know if they failed platinum therapy first line, right? That's how the trial was done.
Yeah.
So do you know that, and do you have any concern that maybe they won't be... You know, payers will push back and say they're not exactly on-label?
So in our case, they have to be on-label to get paid. And when we work down, you know, who failed platinum or who had platinum, who failed it, we get to a TAM of about 30,000 patients. You know, that, that would be on-label.
Second line.
Second, third line, it would be on-label. And, as I said, that's a multiple of our GBM TAM. So, and then from there, of course, we've got PANOVA-02. And ultimately, if any of us had a loved one with lung cancer, what you want is, you know, it's kind of obvious. You want Tumor Treating Fields and then, you know, a PD-1 inhibitor in the first line. And we have to get there, and so that's PANOVA-02, is to-- But in the meantime, we have a TAM of, you know, 30,000 in the U.S.-
Right
-to go after.
Sorry. LUNAR-2, I know you-
LUNAR-02.
I know you're excited about PANOVA.
Okay. Sorry. Long day. LUNAR-2.
Got it. Okay. All right, we'll get to LUNAR-2, but-
But the bottom line, 30,000 patients in the U.S. that we can go after on-label, and you know, we can't wait to get after it.
And how should we think about the ramp? You know, we have one analog, which is... Well, we have two, really, recurrent and-
Yeah
newly diagnosed, but let's just say newly diagnosed GBM. We know what the penetration is in the United States. How should we think about kind of the ramp and the ultimate penetration in that thirty thousand, you know, patient population for non-small cell lung cancer?
You know, so the simple answer is we don't know, right? These are patients who are very sick. The 30,000 are seeking treatment, and there's nothing for them. You know, so lung cancer's crowded, you know, in the first line. It's crowded for patients who have driver mutations, but these 30,000 are the patients for whom there is nothing but, you know, bad chemotherapy. And so, I would expect a ramp that is a medical device ramp, not a drug ramp. And what do I mean by that? You know, drug ramps like this, and then goes to the plateau and falls right off. We're gonna have to educate, we're gonna have to get these good experiences, and then we're gonna have to build. In GBM, you know, so what are some of the differences?
In GBM, it's 60% academic, 40% community. Academic is harder for us because the incentives there are to stick patients on trials. Lung's reversed. It's mostly a community, and so the community oncologist can prescribe our therapy, can keep the chemo going, keep the immunotherapy going, and keep the patient, so I think there are, you know, there's some dynamics here that I think have the potential to be helpful, but we have to see. We have to get out there and see.
Okay. I mean, I've heard there's a community doctor. There could be some reasons why it's more difficult to penetrate community physicians, too. I don't know, time constraints. I don't know.
But again-
Just awareness
... we take that out of the equation, right? And we've done that from day one. All they have to do is write a script. Again, the script comes to us, we go to the patient, we deliver the therapy, we monitor it. It really is very light touch for the clinician. And again, I think that's part of the reason the GBM penetration in the community is so high.
All right. Brain metastases, METIS.
Yeah.
Are you still on track to file METIS in the U.S., Europe, and Japan by year-end?
We are.
Have you filed anywhere yet?
We have not. We'll let you know when we file, but we're on track to file by year-end.
Do you have clarity on which division at FDA will review the filing?
It's CDRH.
Okay. And the publication?
So that's in the works. I don't have anything more to say than that, but-
Is that accepted?
Again, we'll let you know when we have, you know, definitive clarity on the publication. I don't have it yet.
Any additional analyses we should expect at future medical conferences that doctors are asking for?
Yes, there will be future analyses. As I said, I'm not gonna outline them today, but you know, one. Well, one, I will outline. You know, there there's a real interest to know what were the background therapies that these patients were on over the course of the trial, and that's an analysis that's ongoing and is of great interest.
Remind us of the TAM there.
You know, this is another one. By the way, I think this is all gonna come out, you know, in the wash, but we're not getting, I don't think, any credit in the stock. But brain metastases are a real issue for non-small cell lung cancer. First of all, it's the number one source, if you will, of brain mets is non-small cell lung cancer. Fully 25% of the patients who are diagnosed with non-small cell lung cancer have mets at the time of diagnosis, and another 25%, so 50% total of non-small cell lung patients will be diagnosed with brain mets. So that's a huge number.
Brain mets are associated with a precipitous decline in quality of life because of the cognitive decline, and it's one of the principal reasons that patients, non-small cell lung cancer patients will not seek treatment in the second line because of the brain mets and the cognitive decline. Our data, again, were really spectacular here. We showed a year increase in the time to progression and maintenance of cognitive function across that period of time. So again, when we do the same thing, you know, we cut and paste and look at the patient population, you know, we're using an internal number of a TAM of about 16,000. I think that's conservative, but that's the number we're using. And again, that's bigger-
Sixteen?
Sixteen thousand.
Right.
That's bigger than our GBM TAM, again. The other nice thing about brain mets is it's plug and play with our existing commercial organizations. It will overlay both thoracic and CNS. You shouldn't expect any significant increase in operating expense in order to bring that to market. We'll get it. It is a PMA. We'll get it filed this year, nine to 12 months, you know, typical for PMA. We always try and push that, but, you know, that's typical. End of next year is what we're you know shooting for.
Got it. And that ramp, maybe how you compare and contrast, I mean, GBM, non-small cell lung cancer, brain metastases.
You know, so again, don't know till we get there. If you asked me to bet, I would bet that brain mets will be much faster than lung. And I bet that because it's brain, there's nothing at all there, you know, so there's no therapy. These patients get stereotactic radiosurgery and then watchful waiting as their, you know, condition deteriorates. We're well known as a brain-effective brain therapy. So I think we've done a lot of the... I think the hard work we've done in GBM will make that a little bit easier.
And some-
I think, but I'll add, I think, you know.
One of the issues is competing therapies.
Mm-hmm.
At an academic center, if they're doing a lot of trials, sometimes the trial doesn't allow for, you know, another therapy.
Yep.
You know, non-small cell lung cancer, there's a lot going on.
Yep.
So that might be kind of a barrier to adoption. Do you see the same thing for brain metastases?
There's almost nothing in brain mets. So that would be a-
Yeah. So you understand what I'm-
I do. I do.
Yeah.
Yeah, and you're right, lung is crowded. However, you know, lung is also not one thing, right? You know, the areas that are the most crowded are first line and variations with driver mutations, where people are going after with ADCs, you know, where they can attack a specific mutation. Our 30,000 is, does not include. These are the patients for whom there's not a driver mutation, where there really isn't-
Right
... anything for them. So it's a little bit of a clearer shot, but your general observation is correct.
Putting aside the TAM, the differences in the TAM, you've had the METIS data now for six months, I don't know, something like that, four to six months. What are you hearing from doctors, from clinicians regarding relative to, you know, METIS and brain metastases and non-small cell lung cancer? Which one are you seeing kind of greater interest, more, you know, which one do you feel more bullish about?
You know, I'm gonna give you the answer that maybe you expect somebody to get. I'm bullish about both, you know, again, for somewhat different reasons. In mets, again, we're well known in the brain, and there's nothing else there, and the quality of life, preventing the progression of the brain mets is a significant part of the deterioration and ultimate demise of these patients. So I think it's a big deal. On non-small cell lung cancer, again, in this second, third-line setting after platinum failure, there's nothing there either. So, you know, there's pemetrexed, and it doesn't work very well. So what clinicians are telling us is, "No, we have these patients in our offices every single day," and they always say, "The patients and the families, they wanna do something.
I'm gonna keep them on my... their IO because I don't dare take that away." But they're starting to progress. They're, you know, we hear—we didn't come up with this term, but it has been used, you know, the smoldering progression. "It's progressing. I don't dare take the IO off. I want to add this to those patients." So, you know, we see... I think it's a little more uncharted territory, though, thoracic than brain. And so if I had to lean, you know, if you made me lean one way or another, what's a little bit easier, I think probably the brain mets is a little easier, but only for that reason.
...And there's some relationship between or among the three indications you have, right?
Yes.
There's lung, there's the brain-
Yes.
Right? And the brain, then metastases.
Yes.
There's brain metastases due to non-small cell lung cancer. What do you, how, what are you seeing from academics making these connections or are there synergies commercially?
So there's definitely synergies because you point it out, you know, the brain mets is the disease that starts in the lung. So clinicians say, "Well, here's an obvious use case." You know, you're using it in the brain without any confounding variables, and it worked. So okay, I guess it does work. I think that helps our GBM business because, you know, the neuro-oncs, a lot of them are seeing a lot of these patients, as well. You know, the thoracic oncologist sends them to the neuro-onc to, you know, get whatever they may have. So I do see these as being all three being linked in sort of a virtuous cycle.
You touched upon your GBM business, which is obviously your core revenue right now.
Yep.
How are you feeling about just kind of the GBM business in general going forward? You know, you did see in Q2 an increase in net revenue for patients in the U.S. and Europe. Just how are you thinking about growth of GBM?
Yeah. So, you know, it's no secret, you know, Larry, as you and I have spoken over the last couple of years, you know. So one, we had plateaued at about this 40% penetration in our big markets. That was incredibly frustrating to me because, you know, the other 60% of the patients could benefit. You know, maybe you never get to 100, but, you know, we're NCCN Category 1, we have access everywhere, so everybody gets, you know, we get paid, and yet we're at 40%. And maybe you could make an argument, the oldest patients, you know, if you're the most frail or, you know, you were living alone, without any support, maybe but, you know, it should be 80, not 40.
So we made a lot of changes last year, and for us, the key number is patients on therapy, right? We pioneered the subscription payment model here, where we get paid per month of therapy, and I say pioneered as a med tech company, we really pioneered this. So for us, that means getting the script, getting the start, and then keeping the patient on. You know, everything is easy in hindsight, but we had three different groups responsible for those three different things. Last year, we blew that up, and we made it one organization under Frank Leonard, one of our, you know, most talented executives. Now our people are incentivized based on the number of patients. They have to hit all three levers.
We, you know, Q2 had a record in patients on therapy, which is important. You see us growing again. France is helping, you know, no doubt. Great in France, but we're seeing, you know, Germany is looking good, Japan's looking good. The US, we're pushing hard, and patients on therapy are good. We're keeping them on. There's still more we wanna see. We wanna see more scripts, and we're starting now to employ some different tools. Well, you know, I talked about this on the earnings call, the tools to do direct to consumer marketing with smaller and smaller groups. You know, five years ago, it made no sense to advertise in GBM because you couldn't target well enough.
Now, we can target those patients, and there's a huge difference between, when a patient walks into a academic neuro-oncologist and says, "You know, help me, help me," versus, "Tell me about Optune. I, you know, I read about it, it looks like something I'd be interested in." And, and that, that can be, I shouldn't say can be, it is a huge differentiator when they ask for it. So, you know, more to come on this, but growth in GBM is one of our three key priorities. That's the other thing we did, we really distilled our three priorities to grow GBM, launch lung, and then, you know, deliver PANOVA, medicine PANOVA. And that's, you know, that's what our team is focused on this year.
PANOVA, five and a half minutes left. When are we? Just remind us of when we're gonna see the top-line results.
Yeah, so PANOVA, again, everybody, phase 3 trial, first line, pancreatic cancer in the patients who are called locally advanced. So when a person is diagnosed with pancreatic cancer, it's one of three buckets. One, it's very early, when it's operable, that's a very small percentage, 5%, 10%. Then the next time is locally advanced, when it's spread, you know, through the peritoneal cavity, but is yet to be in the bones and, you know, beyond the peritoneum, and then the final is metastatic. When we did our phase 2, we recruited patients who were both locally advanced and metastatic. Maybe not a surprise, based on our therapy, the locally advanced percentage did exceptionally well.
In fact, our progression-free survival was increased, I think it was like six months, and we didn't hit the median in the trial duration. So that's the population: first-line, locally advanced, with the same chemo regimen that we used in the phase II. So if you would ask me, what trial would I design today? It's the same trial, so it's not, "Oh, we've learned something. I wish it was this," or, "I wish it was that." This trial is fully recruited, has an eighteen-month follow-up, so we're literally on the clock now, waiting till, you know, a couple more months. We'll clean up the data, and then we'll make the top line public.
So the follow-up, when was the last patient in on?
Last patient in was February 15th, 2023. Eighteen-month follow-up-
Eighteen months.
Brings you to, a couple weeks ago, and then, you know, about call it three, four months to clean up data, so squarely in Q4 is our guidance for top line.
Got it. Okay, and the TAM again, Bill? I don't think you told us the numbers.
Let's see. I have memorized a lot of TAMs here. What's the TAM for this one?
There are about 48,000 patients every year in the United States with pancreatic cancer. Now, as Bill said, some of those are locally advanced, some of them are metastatic. There's varying research, but call it 30%-40%, that are actually locally advanced within that 48,000, each year, U.S. alone.
Yeah.
So you're talking about, like, 15,000-20,000 ?
Correct.
That's a good round number.
Which is about 2x the GBM market.
This is on top of docetaxel, on top of a taxane.
It's on top of, gem Abraxane, so gemcitabine plus Abraxane.
Any concerns, given what we saw with docetaxel? You know, taxane, initially, ten years ago, you thought it was gonna be synergistic.
Yeah.
Right now, it's maybe, you know, maybe not-
So-
-based on what we saw in LUNAR.
We're gonna see the data here in, you know, shortly. But what we found in the one trial that didn't work, the ovarian trial, was that there was it was a different drug that was not used in the phase II , that turned out to create fibrosis that actually changed the conductivity. We don't expect anything compounding like that. These are exactly the same patients that were treated in the phase II, being treated in exactly the same way.
Ovarian was metastatic. What was the difference?
Ovarian was like, it was literally fourth, fifth, sixth line. These were women who were w ay near the end of their journey.
Okay, so still cautious optimism on PANOVA?
Yes. Yep, very much so.
Okay. And the other thing that was interesting was on the Q2 call was about the KEYNOTE-B36-
Yeah
-evaluating next steps. That trial's been going on for you know, quite a while now. What are the next steps, and, you know, why has it taken so long to enroll?
So we are fully committed to the lung program. That trial that you described is a phase two trial that we tried to just spin up and get going very quickly. It's our therapy plus pembro, so Keytruda monotherapy. It turns out very few patients get pembro monotherapy. It's like less than 5%, and so the pool for that trial is really small. LUNAR-2, which is the phase III trial, first line, pembro plus platinum, that's where all the patients are. So when we say one, given that we're now full speed ahead in the registration trial with the right patient population, how important is this really? That's, you know, what we're, you know, debating internally, and we just wanted to flag that.
Have you disclosed how many patients were enrolled?
We haven't. We don't do, you know, intermediate enrollment, but, you know, we wouldn't have flagged it if we didn't think that, you know, the value of this trial is, and the effort that we have to put in is not worth it.
LUNAR-2, it started enrolling?
Yes.
ClinicalTrials.gov has a late 2028 primary completion date. That sounds a little aggressive.
It's 734 patients, so we have not given that guidance, but it'll take a few years.
Yeah, and we're just ramping the number of centers now, so we've recruited, but we're in the center ramp phase for that trial.
Right. Bill, we're almost out of time. We're kind of out of time, but this is the last session, so, you know, we can go a couple of minutes over if you wanna... If there's anything we didn't cover, if you wanna make any concluding remarks.
No, you know, again, this is a super exciting time for Novocure. We’ve worked very hard for twenty-two years to build the business, helping patients with GBM. You know, Asaf gave a bit of a farewell talk in a town hall. You know, we’ve treated over thirty. I think the round number is thirty-five thousand patients with GBM. We’ve made a significant difference in so many families' lives, but there’s more. We’re gonna-
Mm-hmm
... we're gonna add immunotherapy to and we're doing this. So we're in a registrational trial in GBM with Keytruda plus, you know, based on the phase two work that we saw data trended, that's exciting. We have. We didn't talk about it, but we have TRIDENT, which is tumor treating fields plus radiation in GBM, that'll read out in very early 2026. That's exciting. We have a phase II with Roche in metastatic pancreatic cancer, and that's. You know, when we see the Panova data, I can tell you that's gonna be the next discussion. Is, "Okay, you've got it in locally advanced. How do we get it in metastatic?" So our commitment to brain, lung, and pancreas is fundamental, and we're also committed to reaching profitability. Our GBM business is profitable.
We could be a profitable company. We're balancing investing for growth responsibly, and I think, you know, we made some moves on the balance sheet to give everyone confidence that that's in fact the case. So, you know, we're not gonna run out of money, you know, we're gonna be just fine financially, and we're gonna build these businesses. So I really do appreciate everyone's attendance and interest in our company.
Thank you. Great place to end.