Hello, everyone. My name is Mitchell Kapoor. I am a Senior Biotech Analyst at H.C. Wainwright. It is my pleasure today to welcome you to the UroGen Fireside Chat. Today, I have the pleasure of welcoming Liz and Chris from the company. Thank you so much for joining us today.
Well, thanks for having us. We appreciate it.
Thanks, Mitchell.
I like to start off every Fireside by just recapping the company a bit.
Yeah
The key priorities and what investors should think about UroGen if they're not familiar with the story or up to speed.
Okay. I think to take a two-minute going back, our company was founded many years ago in Israel by a group of chemists who were trying to answer a challenge that urologists have. Urologists treat cancers locally, so they give intravesical therapy rather than systemic therapy. Somebody was just calling it cancer lite. Because of that, medicines in the urothelium can't really stay long enough to have a meaningful impact for patients. Therefore, these patients really standard of care is multiple surgeries time after time again, particularly in the group of patients that we have. This group of chemists developed a very elegant solution called RTGel, and it's not called RTGel, it's reverse-thermal hydrogel, where it's actually liquid when it's warm, which is why it's called reverse-thermal.
I mean liquid when it's cold, and as it hits the warm temperature of the body, turns to a gel and then, over time, disintegrates and elutes medicine out to the cavity. In our case, the upper tract or the bladder. That's what our company was really founded on. You talked about what are our priorities. Obviously, right now, we got approval for Zusduri, which is for a low-grade intermediate-risk non-muscle invasive bladder cancer, and our launch right now is our number one priority. We have to make sure we continue to accelerate and grow that business, not just for our company, but for patients, because we really feel very strongly that this is a better way to treat these patients. They're an older patient population, and our data shows very meaningful, complete response and durability.
These patients have an opportunity to not only live recurrence free, but live treatment free, and not have to worry about these sort of multiple surgeries. So that's our company. In addition to where we are today with our two products that we have on the market, we have lifecycle management that we're working on, so we'll take UGN-103 into other bladder cancer spaces. We have an oncolytic virus in UGN-501. We also recently did a deal with a company called IntraGel Therapeutics, and so we're really building our company for the long term.
Wonderful. That's a great place to start. Speaking of the launch, you're in the early days, and that's a priority, as you mentioned. Can you just kind of help us understand how that's going? Zusduri grew 73% sequentially to $50.4 million. What's driving the quarter, and how much of that step-up was underlying demand versus net pricing, channel inventory? Just help us understand what's the receptivity been like.
Sure. I'll ask Chris to sort of comment, and then I'll add any.
Yeah, just to answer your last question first, in terms of what's driving it, is all demand. Just given the nature of our products, it's a buy and bill drug, so physicians acquire the product and then instill it in the patient. We really don't have inventory dynamics with the way the drug is distributed, and we really have had consistency in terms of gross to net. It is truly demand that you're seeing reflected in the revenue. In terms of what's driving the launch, one, we received the permanent J-code effective January 1. That was definitely an inflection to give the physician community confidence in the reimbursement of the drug. But more importantly, we're very much in the early stages of this launch. It is a large unmet need. There's 60,000 patients in this population.
From a physician perspective, our broad target universe is about 8,000 physicians. Our core target universe is about 6,500. In that $50 million of revenue, only 450 of those physicians have prescribed launch to date. There is a lot of room for us to grow, first, just in terms of breadth of utilization across the physician community. Then importantly, we're finding is physicians who use it and try it, we recently did an ATU, 100% of the physicians who have used the drug said they will use it again. The other piece that we've been really focused on beyond the breadth is really driving depth of utilization. We're really encouraged by the fact that 45% of our prescribers are repeat prescribers. They've treated more than one patient. Again, we're in the early stages, but really pleased with the early trajectory this year.
Excellent. On that note, 204 repeat prescribers, and about half. Can you tell us what's resonating with them? How can that grow? What do these launch metrics kind of say about the repeat rate and the trajectory of the drug?
Yeah, I'll just sort of start there. The feedback that we're getting from physicians is that this is easy to use, and they are seeing in their own experience the success with their patients. That's important, right? Because what happens is you get them to try it. Initially, they're all trying it in your harder to treat patients. They're seeing a benefit in their hardest to treat patients, a kind of a light bulb goes off, right? It's like, "Oh, this is great," because it's really working in this patient population. The durability of response, we just announced in May, that we, 36-month durability of Zusduri, and still haven't reached the median.
When you think about it, about 50% of these patients would have recurred with a surgery within the first year, and now all of a sudden we are past 36 months, and they haven't hit the median. Those are the things that have really resonated with physicians. Getting experience, nothing beats that. We have a lot of physicians, as Chris mentioned, early stages, a lot of physicians that want to use it and say they're going to use it, and we just have to get them to use it on those first patients, have a good experience. We're really focused on making sure they have a very good first positive experience and, then to Chris's point, build that depth.
But reality of it is, you've got everybody from doctors who have decided, "This is the way I'm going to treat my patients," and they treat almost all their patients that way. Then you've got some that say, "Well, I'm only going to use it for those patients who I can't take to surgery." Because you're changing the way doctors practice medicine, and I don't think you can underscore how hard that is, particularly with urologists who are surgeons. You're telling them, "Don't do surgery anymore. Do this instead of surgery." But the receptivity has been really, really good, and we feel, as Chris mentioned, we feel great about where we're headed because we know that as they are getting experience and they're able to share that experience, that more and more doctors will use it.
Great. So repeat prescribers are certainly an encouraging metric. How many patients does a repeat prescriber treat? What would you say that trajectory would look like? Is it a situation where the initial repeat prescribers, they're starting and just trying it in a few of their patients, and you expect that to grow, the patients per repeat prescriber? Or how does that change and how does that eventually level off?
You want to comment?
Yeah. I think within that repeat prescriber base, Mitchell, there's a pretty wide swath. At this point, there are some real early adopters who are using Zusduri for the majority of their patients. So they're looking at a low-grade IR patient and saying, "I'm going to start with Zusduri." There are others who are just in that early stage of evolution in terms of repeat use. So they'll try it on one or two patients. They want to get experience with the drug. How do I incorporate it into my workflows, make sure I get reimbursement, understand from a patient outcome perspective, and then they start to move along the continuum. So we have a relatively wide range there. In terms of how that adoption rate will evolve over time, that is a metric that we're really looking at.
I think to see steady improvement, not only in the number of prescribers, but also the percentage of those prescribers that are repeat prescribers, anticipating that that 45% repeat rate in Q2 will continue to improve as we move through the year.
I think one more sort of metric that we did some claims database research. The good news is it shows that they are not just now treating their heavily pre-treated patients. They are treating, as Chris alluded to, some of the physicians after one, after two, after five, after six, but we are getting the all patient populations and not just your heavily pre-treated. That talks about somebody who is clearly a champion.
That is what we are focused on. How do you build those champions? How do you take those that are early in the adoption and make them true adopters, to your point about the number of patients that they have? To kind of contrast it against Jelmyto, where you have 6,000 patients that are seen by 10,000 docs, so it is very hard to find those patients. Doctors see these patients every day, and so that makes it much easier for them, but also much easier for us in the sense of being able to find the patient.
That is a great segue into this. I am curious, it is an interesting dynamic where 70% of the patients are in the community setting. Your initial uptake and your initial kind of experience, can you help us understand where that has been in terms of academic versus community, how you expect that to change, and what is going to drive growth in terms of accessing these patients, how broad the community is, chair time, buy and bill, all these dynamics that may influence how we can think about the launch trajectory.
Sure. You want to talk about it?
Sure. Some of our early champions were in the large academic settings. The other piece, and you mentioned it, was the reimbursement component. During the period last year with the miscellaneous J-code, community practices are a little bit cautious about using a drug during the miscellaneous J-code, where hospitals are less concerned. What we found was the majority of our business last year, about 60% of our business, was in the hospital academic setting last year. Once we got the permanent J-code effective January 1, we quickly started to see that business shift, and the community practices really started to open up and started to use. To your point, 70% of the patients are in the community practice.
Where we expect to really see the business start to move and where we've seen a lot of the increase in terms of prescriber rates, adopters in the community practice is where we're seeing it this year. If we just think about where the business shift is, 60% was in hospital last year. In Q2, it was already 55% in the community. We expect that number to continue to increase, maybe not all the way to that 70% number, but closer probably to 65% at peak.
Are there any differences you would expect, in terms of the launch metrics and utilization once more of that use migrates to the community setting versus where you're seeing this initial?
I think the biggest thing is just prescriber base, right? There's a lot of opportunity in the community setting to really expand that prescriber base. With that, as they start to adopt it in their workflows, repeat writers in the community is something we're also focused on. The other thing we talk about, or we had talked about was conversion from a patient being identified to a patient being instilled. It goes back to the operational component of this launch. Initially, it takes a little bit of time to get the sites up and running, to get them through the buy and bill process, to get patients set up. But once they've done it with one patient, they move more quickly.
I think as more physicians get experience, more practices get experience with adopting this into the workflow, those conversion rates and time to conversion are going to improve.
Okay, great. What would you need to see stabilize in the launch? Or how far into the launch do you feel you would need to get before you can provide some formal guidance and outlook for the-
Yeah, we want to get at least through a full year with the permanent J-code in place to really understand what is the trajectory we're on, what type of inflection are we going to see with the J-code. Importantly as well, just how do the quarter to quarters, what type of variability could we see within the quarters. I think the earliest we would consider providing guidance would be looking at it for 2027.
Great. Okay. I just want to touch on Jelmyto. Maybe you could help us understand kind of the trajectory there, the second half acceleration, and what we should think about with the 2030 erosion.
Yeah. Jelmyto, as I mentioned earlier, in contrast, is a very small patient population. We always struggle with identifying patients. That is the number one challenge with Jelmyto. But it is a great drug. We expect to continue to see low single digit growth year-over-year. One of the things that has been challenging this year for us has been, well, obviously, the focus has been on Zusduri and the Zusduri launch. But more importantly, it is actually, given it is a small market, there are a lot of clinical trials happening, particularly in the United States. What we have found is that, for a few million dollars of our revenue, that probably would have been in Jelmyto, is going to clinical trials. Again, that space has been just very busy. We are always looking at, okay, that dynamic.
But if you took that dynamic out, then we would be on track with where we are. A lot depends on how those clinical trials play out, but our intention is to continue to grow Jelmyto. Actually, we really believe that in the longer term, because we are calling up more docs, then when they get experience with Zusduri, they are like, "Oh, I like the way Zusduri works, and now I might use it in Jelmyto." Those kind of onesies, twosies, that is the biggest problem, is a doctor is not thinking about Jelmyto, right? Because they only see one or two of these patients a year. But maybe if there was Zusduri, they will start to see that. We are hoping at some point that starts to have kind of a reverse halo.
But right now, again, one of our biggest challenges is really just clinical trials, competition for clinical trials in this space. But we are still seeing some good adoption of Jelmyto in our current base, as well as we continue to see new physicians writing for Jelmyto.
Great. Okay. On UGN-104, can you help us with the timing of that and when it will be submitted, potentially approved? Would you think about the same transition playbook you are using for UGN-103 and Zusduri?
Yep. Absolutely the same playbook. We expect to be fully enrolled in the trial this year, which means we would file. The good news is, the FDA is allowing us to file on six months data with UGN-103. We already filed, as you know. We expect the same thing with UGN-104, and then we update it during the filing. Given that, then our expectation would be we would file in early 2029 and get approval by the end of 2029 and do that shift, as we talked about with Jelmyto and UGN-104 just as we are with Zusduri and UGN-103. I think, look, the big difference today is we just received notice of allowance of a new patent on Zusduri and UGN-103 to 2044.
There's not any pressure for us to make that switch, but we still think it's the right thing to do for the business and it's the right thing to do for patients from ensuring supply perspective, the consistency of manufacturing, the solubility, making it easier to reconstitute. It's got a longer shelf life. All of those things for UGN-103 and then subsequently for UGN-104 will help just in the operational aspects of the products.
Great. Okay. On the UGN-103 switch, how do you manage the switch to UGN-103 pricing relative to Zusduri, the risk of a J-code gap at launch, and cost benefit from manufacturing?
Yeah. One, we will not launch until we have a J-code. We will not launch UGN-103 until we have a permanent J-code. Like I said, there's no real reason to do so, and we want to make sure that doesn't happen. The switch, I think because we have specialty distributors and specialty pharmacy will likely be easier than it would be if you had a drug that patients were going to go and get at the pharmacy. You still have a fairly easy group of physicians and practices that will go through these distributors, and that will make the switch a little bit easier. Look, we are going to do what's in the best interest of the patients and the physicians to ensure that they can get the drug. But either one, we just want to make sure that they can get treated.
We'll have both of them on long enough to make that happen. But at some point, you're going to have to make the switch, and we think that we can manage that pretty easily.
Great. Okay. Jumping around a little bit, but I think this is important. Zusduri, could that potentially move into frontline at some point? And how would that look versus recurrent disease? How important is durability to this?
Yeah. The answer is yes. Obviously, our ATLAS data, we treated newly diagnosed patients. The only reason in our pivotal study that we didn't was it was based on the FDA feedback. They felt like the recurrent patient was the higher unmet need, and because we're a primary treatment and not an adjuvant treatment, we know that 90% of the patients are going to get a TURBT upfront in the newly diagnosed. Having said that, Mark Schoenberg, our Chief Medical Officer, we are going to do a study, and that we will start early next year in the newly diagnosed segment. And that's in addition to a TURBT because they need to do a TURBT for diagnostic purposes. So we will generate data in that patient population. You can use it. You can go back and look at our ATLAS data. It works.
Works well in that patient population, so there's no reason not to be able to use it. The real question does come, and when you're talking about a low grade, even intermediate risk, what's in the best interest of the patient? And being able to have a surgery upfront, and then when they recur, have Zusduri is, in our estimation, in the best interest of the patient. It gives them the best, less treatment, but the best long-term impact. But we want to generate the data because if physicians do want to use it, we're happy for them to use it in that space.
Great. Okay. Looking at UGN-501 and the competitive landscape, could you help us understand what differentiates you guys from nadofaragene and cretostimogene?
Yeah.
What is the phase I design and timing of first efficacy for UGN-501 ?
Yeah. UGN-501, remember, is in phase I, which is a safety study and a dose escalation. We are starting that this year. As a matter of fact, we've already have some site activations, so we'll start to dose patients this year in that. Again, the idea is around dose finding. If there's an efficacy signal, we will report that as well, but the idea here is to get the phase II to study. What's really important about UGN-501 and what makes it different is we believe it's the best in class because it has a dual mechanism in the sense of not only does it elicit the immune response, which you expect from an oncolytic virus, but it also has direct cell kill.
As it enters the cells easier than some of the other, so it can enter more cells, it can actually directly kill the cells, and as it kills those cells, elicits the immune response. So we believe in our preclinical models where we compared it to others. Obviously, we have to demonstrate that in the real-world setting. But it was the most potent of the oncolytic viruses. So we're very excited about it, and also UGN-501 is a good bridge for us outside of urothelial cancers, but UGN-501, there's no reason why you can't use it across most cancers. We will be looking next year to do a basket study in multiple solid tumors with UGN-501.
As we build our company again for the long term, not only are we going to ensure our leadership in urothelial cancers, but also start to look at opportunities outside of urothelial cancers.
Wonderful. With so much going on, I would love to wrap up with kind of the next 12 months ahead. What milestones should we look forward to and the value inflection points for the company?
Yeah. Chris, why don't you?
Yeah, I mean, obviously a big focus is going to be, continue to be the Zusduri launch and how the quarters continue to trend and the growth of the brand. UGN-103, we will continue to follow the patients, and we'll have 12-month durability of response data likely towards the end of this year or early next. We'll use that to also supplement the data in the NDA, and then ultimately looking to get UGN-103 approved, PDUFA date in the June timeframe next year. As Liz mentioned, really excited to get the 501 program up and running. So phase I start. Start to look at the data that comes from that over the course of next year.
Excellent. Thank you, Liz. Thank you, Chris. Really appreciate it, and thank you to all the audience members in the room.
I appreciate it. Thank you.
Thanks.