All right. Good afternoon. Thanks for being here for the Stifel Healthcare Conference. My name is Colleen Kusy. I am one of the senior analysts here at Stifel, and I am pleased to have with us the Protalix team, including Dror Bashan, CEO, and Gilad Mamlok, CFO. We will have a formal presentation and then have some Q&A at the end.
Thank you, and thank you everybody for coming. I will start with a, I would say, a snapshot about the company. Protalix actually develop and manufacture and sell drugs, and we actually do it from concept to the market. We have two drugs approved. One is Elelyso, which is an ERT for Gaucher disease, for patients diagnosed with Gaucher, and the other one is Elfabrio, which is approved in 2023 for patients diagnosed with Fabry disease. Elelyso was licensed to Pfizer, except Brazil. In Brazil, we have our own operations. Chiesi, which is a private Italian company, we will discuss it a bit later, is the global licensor for Elfabrio. Elfabrio was approved originally in May of 2023, with a regimen of once in two weeks, both in the E.U. and the U.S.
About seven, eight months ago, at the beginning of March of this year, we got the once in four weeks approval in the E.U., which is a very nice achievement for us. Actually, 70% of the Fabry patients are outside the U.S., so this is very much important. They do well. In the last three years, the launch is a success, and they do well, and we will discuss it a bit later. This is, if I may say, is the business segment of Protalix, where we enjoy royalties from our partners and the milestone from time to time. The next one is a potential big upside. We have a program under phase II, advanced phase II, if I may say, for uncontrolled gout. We plan to finalize enrollment by Q1 next year, and actually a year from today to have the readout.
We speak about a pretty robust study with a high biostatistical power. We think that once we will open the code and have the readout, we will have very few questions left. These studies following a successful phase I with subject with hyperuricemia, so we know the mechanism of action works well. We have the reasons to believe that we have a fair chance to hit the endpoints in one or more of the four active arms. In addition, the last two, three years, we started to explore and get up the learning curve, and so we have already a couple of programs within selected rare renal disease indications. We are working on that, and I believe that within two years, we will have an interesting basket of rare renal early-stage program, let us say, between discovery to phase I. Just a minute.
Protalix was based or was established, if I may say, both the unique technology where we can express complex human protein through plants as in suspension. This is where Elelyso, Elfabrio, and the gout programs are expressed through. We have our own drug substance line in our site. We are competitive. It's unique platform, and we are pleased with that. For the future portfolio and pipeline, I assume we'll have a combination of program based on our platform and collaborations or licenses from third parties. It's per the indication, the unmet needs per indication. This is the pipeline portfolio, how it looks in a more graphic way. I would like to refer to our financial situation. Actually, today is, there are very few moments in my job at least, a year that you have professional joy, if I may say. Today, we published results.
The market is pleased, so it's nice. We just published the third quarter results, and we have achieved the accumulated $75.6 million. Already, we plan to meet the guidance or even exceed the guidance. It depends upon release of final release of batches. We sit on $48.5 million cash in deposits. Overall, we are in a position where we can plan and finance our strategy and our plans for the next few years. We have the means to finance, of course, the phase II in gout and the other operational responsibilities. Overall, it's a much more solid position that we have been earlier. So we are pleased with these results. We expect a good overall 2026. As we see the data that we get from Chiesi, we think the trend will continue for the foreseeable future.
We think, as I mentioned earlier about what I call the business segment or the royalties and milestone from Chiesi and Elelyso, this will grow and will increase our profitability in time. I would like to spend some time about the gout program. It's very much important. It's a significant upside for our business model. We are now running the RELEASE study. We are more or less two-thirds enrolled. We expect to finalize enrollment by Q1, as I mentioned earlier. Gout, here is one slide, a bit about the disease. What is gout? About elevated plasma uric acid, which actually create crystals in the joint and damages them. There are, I would say, about 11 million gout patients in the U.S. Most of them are lighter patients, if I may say. We are targeting the more severe part, which is called uncontrolled gout.
I will show a little bit later the estimated numbers we are talking about. When you reach a situation where you are in uncontrolled gout, it's usually a very low quality of life. It's a pretty severe condition. The idea is actually to reduce, if I may say, in a quick or rapid way, the uric acid level in the plasma. This is what PRX-115 is about. About the numbers I mentioned, the 11 million overall gout patients, there are about eligible or uncontrolled gout patients, the severe stage of about 150,000-200,000 patients. This is why we put around 180,000. Right now, bless you. Right now, one therapy is approved on the label for uncontrolled gout patients. It's Krystexxa by Amgen. We don't know the exact number. I mean, they grow. It's about a $1.5 billion-$1.6 billion drug probably this year.
We assume it's, I assume, maybe a bit more, 10,000-12,000. We just don't know exactly. They don't publish number of patients. Overall, we think that by the time we will, if indeed the company mature, the program matures positively, so by 2031, this market will be a couple of billions of dollars of market from a value point of view. If indeed we win the end points of this phase II that is going on, we will have potentially, of course, but a differentiated profile therapy to compete well on the market and address the unmet needs of the patients. I think it's extremely significant, both for patients and from a business point of view. So, what we aim to do is actually to reduce the burden of the infusion. We are testing once in four, once in six, and once in eight weeks infusion.
Krystexxa today is approved for once in two weeks. We also have one arm, active arm, with once in four weeks without Methotrexate, which is also, if we meet the end point, it could be very much significant for the patients. Clearly, we aim to have, due to the change in the enzyme that we did when we actually designed this molecule, so we did the change at C250, and we have designed a special PEG, which is a small PEG, 3.4 kDa. It's bifunctional. We think that we have potentially, of course, a favorable masking profile, and therefore, we will be able not only to, let's say, reduce the frequency of the infusion, but hopefully to have a good immunogenicity and safety profile for this product. Together, it could be a home run for us and a good alternative for the patients or for discussion with the treating physicians.
So when we conducted the phase I, it was done with 64 subjects with hyperuricemia. We had eight cohorts. It was a single ascending dose. We started with 1 or 2 mg and went up to 36 mg at the eight cohort. Overall, we had eight subject per each cohort, six on the active, if I may say, enzyme, and two on placebo. You can see here the results from the phase I. We put together the upper, if I may say, three cohorts. By the way, we chose the higher one, the 36 mg, and this is the one that we test now at phase II. You can see actually that the 36 mg, we see that in all subject, we are way below the 6 mg/dL. This is the well-known biomarker for gout, to test the gout patients.
We see that four out of the six subject in this cohort were below 2 mg/dL, which is a significant, if I may say, input. We looked at the different cohort. We saw as we went up the ladder of the strength, we got better and better results, including safety issues or safety events. This is after careful consideration, we looked into it and chose this one to continue with. So overall, it's a generally well tolerated. We had one anaphylactic event in the second cohort after five minutes of the infusion. It was not related to our enzyme. It was carefully checked. The patient is okay. This is it. Knock on wood. This study, it's silent so far, in this respect at least. We can see different inputs related, I would say, safety issues.
We will see in phase II, the phase I is a single ascending dose. In phase II, where we have the multiple dose, we will see the profile from an immunogenicity and safety point of view. It will be we can conclude much better within the year where we are with the result. After we analyzed the data, we went into phase II, it was discussed with the FDA. We have five arms. One is a placebo and four active arms. As I mentioned earlier, once in four, once in six, and once in eight weeks with Methotrexate, and once in four weeks without Methotrexate. Two-thirds in. We have two major events. One is to finalize enrollment within the next four or five months, and the second one is the readout within a year, as enrollment, if indeed it flies. This is the plan.
You can see here the comparison of the different arms, and clearly, once in four, once in six, or once in eight weeks is a significant, I would say, improvement for patients, of course, as long, I'm sorry, the immunogenicity and safety profile are good. Clearly, if the once in four weeks we fly without the immunomodulator, this is also a nice proposition for patients. A bit about Chiesi. Chiesi is a private health company. Originally, it's based in Italy. They have three different businesses. One of them is the rare disease business, where we are part of. We have a high priority, a top priority attention. It's one of their biggest products. It grows. They do very well on the market.
The once in four weeks approved in March clearly enhances it, and we see, I would say, years ahead of continued growth, which is very important for us as a small company, which enable us to execute on the rest of the programs and plans. As for Elelyso, in Brazil, we do well. We have about 25% market share against Cerezyme, which is the main enzyme. Pfizer does to a less extent, if I may say. They are focused on other programs, if I may say. Overall, we sell from Elelyso $22 million-$25 million. This is the range, depends on different treatments. It's steady. In Brazil, we grow slowly, but this is give or take. Fabry will be totally different. At Fabry, we expect, from whatever we understand and speak to Chiesi and analyze the market, to reach 15%-25%, or 15%-20%. This was within.
We think it will be even higher. We will see, let's say, in the next year or two, and we may update this forecast. It's significant because it can drive Protalix $100 million in revenues and more. We are also entitled from time to time to different milestones, regulatory, like the once in four weeks, and future commercial milestones. It's a significant portion of our business, of course. This is just to illustrate how the once in four weeks improves, if I may say, the quality of life of patients. Actually, they get additional two weeks of freedom. This is competition. There are additional two enzymes which are approved a while ago, the once in two weeks, ERTs, Fabrazyme and Replagal. There is a chaperone technology by Amicus called Galafold. Today, it's by BioMarin, and they do very well. It's about $500 million-$550 million a year.
It grows. There is Elfabrio, which is, I would say, the new ERT on the block, which we think is a good alternative for the patients. Chiesi indeed, let's say, proved that this is the case. This is about Chiesi, just in a nutshell. It's a couple of billions. It's like EUR 4 billion. It's a big company. They are stable, they grow, they are profitable. Again, we are pleased with our collaboration with them. For the future, this is just about the patent. I would like to summarize, if possible. I think we invest more and more in the last two, three years in rare renal beyond the 115. We see buds. I hope that within two years, there will be, I don't know, four to six programs, give or take, between discovery and phase I. We will update accordingly.
Some of them through our platform, some through collaborations. This is just to close. As I mentioned earlier today, the commercial part, which has limited downside, actually, very limited in our case, because the Elfabrio, the launch is a success, and the once in four weeks enhances that. I think the financial data speaks for itself, and we have a big upside with the 115. Overall, we see where we are today, where we'll be in a year and couple of years ahead, and then into the future through the rare renal. This is it in a nutshell. Thank you.
Great. Thank you for that overview. As you mentioned, the Q4W regimen was approved in March in Europe earlier this year. Can you talk about some of the trends that you're seeing with that new regimen that was approved?
It's about 7 to 8 months on the market. More and more markets are approving the additional regimen. New markets like Brazil, I believe it was last week, they approved the once in two weeks and the once in four weeks at the same time. I think it's a bit too early to say. So far, it looks very good, and we think it will continue to drive further penetration in the current market and successful launches in new markets that will be approved. We are optimistic.
That's great. The announcement that you guys had with your earnings today, expect to meet or exceed your 2026 guidance of $70 million-$83 million in total revenues. Can you just speak to that agreement with Chiesi and how you recognize that revenue?
Yeah, please. Maybe Gilad, our CFO, will address it.
This is not a classic royalty model. A classic royalty stream or a classic royalty model is when the revenues of Chiesi are growing, our revenues are growing one-to-one. This is not 100% correlation because the model is that we are selling batches to Chiesi. It's more about the inventory management of Chiesi. Of course, it's correlated to the increased revenues of Chiesi, but if Chiesi in one quarter decides to increase the inventory in one more batch, then the next quarter it can be one batch less, and that's why you see fluctuation. That's why we encourage investors to look at it on an annual base, and that's why we gave guidance of $78 million-$83 million, which consists of $33 million-$35 million revenues to Chiesi, which is, by the way, 50% more than last year.
There is, of course, a correlation, but it's not a one-to-one correlation with the revenues of Chiesi. I would add to that and say that what we see is a very impressive increase of number of patients, even every four weeks in Europe, but not only in Europe, also in the U.S. and ex-Europe. This trend we see, and it's also reflecting the number of batches we sell, but it's not one-to-one.
But certainly, just to add, 2026, the correlation between what we sell to their inventory, what they order, and what is going on in the market is becoming closer. So I think we have a good Q3. We should have a good 2026. We will put guidance for 2027, of course. So I think altogether, we are on the right trend.
Helpful. And let's spend a little bit of time on your wholly-owned development pipeline. You touched on 115. I know you touched on this a little bit, but what's so exciting to you about the phase I SAD data that you've presented so far?
Again, again?
What's so exciting to you about the phase I data you've presented so far?
First, we see the mechanism of action works and works well, because the subject with hyperuricemia. Second, we saw a pretty long period of about 12 weeks of active enzyme. I mean, I speak with the highest dose. We also saw, I don't remember the exact number, I think 40 or 40-something days below 2 mg/dL with this 36 mg/dL. From whatever we have analyzed and did some simulation, we think these are good results. Although it was only a single ascending dose, we have the reasons to believe we have a fair chance to hit one or two arms in the phase II with good results.
Great. How is that enrollment going in the phase II study?
We think we are doing okay. We are two-thirds in. We plan to finalize enrollment by Q1 of this year, then the six months study protocol, then I don't remember, 5, 7 weeks to go through committees and finalize all the data. So actually, in about a year, if indeed we, let's say for the example, we end enrollment by the end of February, so in a year from today, we'll have the readout.
Great. What are you hoping to show in that phase II study? You're looking at a few different dose levels. What would be a success for that phase II study?
Actually, what we measure is the same 36 mg between couple of different frequency of infusion. First, I will say we hope to hit and show good immunogenicity and safety profile. In addition to that, if we hit, for example, once in four weeks without Methotrexate, or once in six or eight weeks with Methotrexate, it is a home run for us.
What are the key efficacy endpoints that you are looking for?
The main one is the proportion of responders within 80% of this six months protocol. Krystexxa, for example, is 70%, so clearly we want to be close to this number or, I do not know, say above. Then there are secondary endpoints which are related to different uric acid, immunogenicity, safety, and then of course, there are other like questionnaires and other data.
Great. That data is coming, as you said, maybe roughly a year from now.
Yes, correct.
What does the development strategy look like after that? What are the next steps for that program?
The next step will be meeting with the FDA in order to initiate a phase III study. Hopefully, it will be one pivotal study. We have to discuss it with them, subject to the results. This is it. Then, if indeed successful, because since this study is done in a robust manner, if I may say, like 85% and more biostatistical power, there will be, we think, few questions left, for good or for bad. So we will be able to fine-tune, if I may say, the one or two active arms going forward, and hopefully execute successfully.
Yeah, you touched on it right there maybe, but would you consider bringing more than one dose or cadence for-
Yes. I think that, look, we don't know. We cannot foresee the future. But if indeed we hit well the main endpoints for, let's say, two out of the four, we will continue with them to give, let's say, different profiles for the treating physician to discuss with their patients and treat them.
Great. Fast-forwarding a bit, if this comes to the market, what's kind of the key differentiators that you're looking to offer versus Krystexxa?
I think it's a combination of good immunogenicity and safety together with increased or reduced the frequency, but improve the burden on the patient. For the example, let's say it's once in six weeks as base case scenario, so they will come to the clinic, let's say, every eight, nine weeks instead of 20 times, 22 times a year. It's significant. Again, immunogenicity has to be a good profile. I don't know to define right now what is a good profile because this is a multiple study, the first time we do a multiple study. Of course, safety, IRRs, et cetera, should be in a pretty low manner. Yes, I think it's a significant improvement if this comes through.
Great. How would you think about future commercialization?
Look, we will see the results. Then there are a couple of options. One is to continue to do it by ourself, and then by 2031, Protalix will be in a situation that we can establish our own platform. We can use third parties as, let's say, additional commercial muscles and brain. We can license it like we did with Chiesi. We can do co-promotion. We will see.
I think right now, as we evolve with the company, and the company's getting stronger and stronger, today we'll consider seriously the first option. It will enable us to increase the business flexibility, to enjoy more from the upside, if I may say, instead of, for example, 25% from A to Z. We will see the results. We will discuss. We will look into it seriously. We are now initiating, I would say, a pretty robust market research with potential three TPPs. We'll get the inputs. Hopefully, we'll be ready way before the readout.
Great. Maybe to just touch briefly on the rare renal side of the business as well. What are the kind of next things we should be looking for out of that development?
This is early. I think within the next two years, there will be, I don't know, 4 to 6, 5 to 7 program between discovery to phase I. It will be less realistic that we can license a ready-to-phase-II asset because we do not have yet the commercial infrastructure, and we are a pretty small company. But all of these programs are heavily considered. There are new mechanisms of actions addressing real unmet needs. Each and every one that will be close to phase I and then further to phase II could be a significant improvement and a big value contributor.
Okay, great. Maybe just in summary now, could you just kind of wrap things up over the next 6 to 12 months? Why should investors be paying attention to Protalix?
One is our commercial, I would say, segment, where we will see better and better execution and results, okay? As we did Q2 and now Q3, and then the overall 2026, and we plan to stand by the guidance of 2026. We will have guidance for 2027, which we think will be good. I think we are on the right trend for the next years to come. Of course, the gout, in Q1, we believe it is a major catalyst to finalize the enrollment, because then there are six months of protocol and the readout, and the readout, which is in a year from today. These are the two main sections right now.
Okay, great.
Yeah.
Thank you so much. That was a great presentation.
Thank you. You are welcome. Thank you.