Welcome. This is Michael Partridge, Senior Vice President of Investor Relations. Tonight, we will review with you Vertex's business progress and provide our second quarter financial results. Making prepared remarks on the call tonight, we have Doctor. Jeff Leiden, Chairman and CEO Doctor.
Reshma Kewalramani, Chief Medical Officer, and Charlie Wagner, Vertex's Chief Financial Officer. Stewart Arbuckle, Chief Commercial Officer, will join us for Q And A. We recommend that you access the webcast slides on our website as you listen to the call. This conference call call that are subject to the risks and uncertainties discussed in detail in today's press release and our filings with the Securities And Exchange Commission. These statements, including without limitation, those regarding Vertex's marketed CF medicines, the ongoing development and potential commercialization of our combination regimens for cystic fibrosis, Vertex's other programs and Vertex's future financial performance are based on management's current assumptions.
Actual outcomes and events could differ materially. I will now turn the call over to Doctor. Jeff Leiden.
Thanks, Michael. Good evening, everyone. It's with great pride and appreciation for all that our employees and leadership team are achieving but I'd like to take a few moments to talk about our progress and to affirm our strategy going forward. I'm pleased to say that our business is outperforming on multiple fronts. As we enter the second half of the year, we are on track to achieve or exceed our 2019 goals, and we're well positioned for continued nation and growth in the future.
We're treating more people with CF than ever before with our approved medicines, which continues to drive significant revenue growth support investment aimed to creating future medicines. We have rapidly grown our pipeline beyond CF, and we now have ongoing development programs evaluating 7 different potentially transformative medicines spanning 5 specialty diseases. We have also established new collaborations and acquisitions over the past year aimed at complementing our productive internal research engine. First, the CF. Our progress in CF has been extraordinary.
In 2019 alone, we have received 9 new regulatory approvals or label expansions for our CF medicines globally, reached new reimbursement agreements in 10 countries outside the U. S, and completed the phase 3 program for our triple combination regimens involving nearly 1000 patients. And just last week, we announced the submission of a new drug application for the triple combination of VX-four forty five TESSACaptor and ivacaftor to the U. S. FDA.
Marking the most significant milestone to date in our efforts to create new CF medicines over the past 2 decades. The phase 3 data we announced in May for the VX-four forty five triple combination regimen were unprecedented, showing a proven in lung function and other measures of the disease that were among the highest magnitude ever seen in any of our CF studies. CF is a progressive and debilitating disease. We share the urgency of patients who are waiting for a new medicine to treat the underlying cause of their CF. And we therefore moved quickly to complete our NDA for the VX-four forty five triple combination within just weeks of receiving the final data.
Outside the U. S, we are focused on reaching new reimbursement agreements for our current CF medicine. And wherever possible, we are seeking for fully agreements that will also provide patients with access to future CF innovations from Vertex. Beyond CF pipeline is expanding and advancing rapidly. We have 7 potentially transformative new medicines in clinical development across 5 serious specialty disease areas including alpha-1 antitrypsin deficiency, APO L1 mediated kidney diseases, pain, sickle cell disease, and beta thalassemia.
We are also increasing our external investment to build a toolkit to develop future breakthrough medicines and specific diseases we're interested in. Most recent example of these efforts are the recently completed acquisition of Axonics Therapeutics and our expanded collaboration with CRISPR Therapeutics aimed at the development of new genetic therapies preclinical results and also enable us to integrate cutting edge scientific technology and expertise in diseases that are highly aligned with our business strategy. We plan to execute more of these types of deals as we Our strategy to create medicines by investing in serial scientific innovation is working as demonstrated by our continued strong performance in the first half of twenty nineteen. Importantly, our commercial success allows us to invest both internally in our own pipeline and externally through new collaborations to fuel our future growth. The results of our substantial and highly directed investments in R&D are evident in the significant progression of our pipeline.
And we have the potential to achieve risk lowering clinical data in several programs in 2020. Before I end my prepared remarks, I'd like to say a few words about the leadership transition that will happen 8 months from now, where I will become Executive Chairman Rashma will become Vertex's new President and CEO. First, let me say that it's been a tremendous pleasure and honor to lead this company since 2012. I'm very proud of what the team has accomplished during that time. Vertex has never been stronger.
Our business is growing rapidly and will continue to grow for the next decade as we bring Alexa captured to the vast majority of CF patients worldwide and then deliver on our clinical stage pipeline in multiple other serious diseases. Based upon our success in CF, we now have the financial strength to invest in both internal and external innovation to deliver even more transformative medicines to more patients with serious diseases. Finally, we have an outstanding senior leadership team with a proven track record executing against our strategy. Together these factors differentiate us and position us for long term success. Having worked closely with Reshma for the last several years, I know that she is the perfect choice to succeed me as CEO and is fully prepared to lead Vertex into the future.
As a physician scientist, she has a deep commitment to our strategy of serial innovation, as well as our inclusive culture of outstanding science. She's an excellent communicator and a strong collaborative leader with a proven ability to execute against our strategy and deliver results. Importantly, she has a track record of putting patients first and driving innovation to have a transformative impact on patients' lives. Of course, you all aren't getting rid of me quite yet. As you probably know, smooth, non disruptive succession has historically been one of the biggest challenges for biotech Companies.
Recognizing this, the board and I have worked for several years on a succession plan that would ensure both strategic and operational continuity. As part of this plan, I'm looking forward to playing a continued active role in the company as executive chairman, supporting Raishman and our team through a smooth transition through Q1 twenty twenty three. Specifically, Raishman, I have agreed that I will maintain an active role in four areas of the company. Business development, helping to get deals done to secure our access to external innovation and products, building our new and research site dedicated to genetic therapies, investor relations, and public affairs and government relations where I've established important relationships with the state federal and international levels over the last 7 years. I look forward to continuing to engage with you as the company progresses.
I'll now turn the call over to Reshma.
Thank you, Jeff. I'm honored to become Vertex's next CEO. Over the last 8 years, your strategic vision and relentless dedication to science and serial innovation has transformed the company, revolutionized the treatment of CF and produced a pipeline of breakthrough medicines for other serious diseases. The success of our serial innovation strategy has also resulted in unprecedented financial strength. I believe strongly in our differentiated strategy, and I have no plans to change it.
Our commitment to finish the journey in CF and to create multiple transformative medicines for other serious diseases has never been stronger. I look forward to continuing to work alongside Jeff, and our outstanding senior leadership team at a time of such great opportunity for the company and to deliver on our promises to bring more transformative medicines to patients with serious diseases who are waiting for them. Now turning to key updates on our medicines in clinical development. 2019 has been a year of important clinical and regulatory milestones for our CF medicines and our pipeline beyond CF. In CF, we recently submitted our NDA for the VX 445 triple combination regimen and remain on track to complete our application in Europe in fourth quarter of this year.
Our NDA included a request for priority review, which if granted, would provide a PDUFA date sometime late in the first quarter of next year. If approved, this regimen would not only be the first medicine to treat the cause of CF, For the FMF population, the largest remaining group of people with CF without a medicine for the underlying cause of their disease, but it would also be a significant enhancement for the FF population. The VX 445 triple combination regimen represents a significant advance over currently available medicines and may be able to treat up to 90% of people with CS in the future. We want to bring this medicine to as many patients as quickly as possible, and we've already begun our efforts towards gaining approval for this regimen in younger patients through an ongoing efforts ongoing across 5 different diseases and expect important clinical data readouts from multiple programs in 2020. In our AAT program, we have completed evaluation of single and multiple ascending doses of our first molecule corrector VX-eight fourteen in healthy volunteers.
Based on the safety, tolerability and pharmacokinetic data from this study, We've decided to advance VX-eight fourteen into a phase 2 dose ranging study in AATD patients who have 2 Z mutations. We expect to obtain clinical data from and consistent with our approach of developing a portfolio of multiple potential medicines in each of our programs We have also recently advanced a second AAT corrector VX 864 into phase 1 development. Both VX-eight fourteen and VX-eight sixty four have received fast track designation from the FDA. In pain, we have established proof of concept for NaV1.8 inhibition in multiple phase 2 studies in acute, neuropathic and musculoskeletal pain conditions. We've identified a number of selective NaV1.8 inhibitors and our plan is to obtain clinical data from multiple compounds in order to choose the best molecule or molecules to advance into late stage development.
We announced today that we are initiating a phase 1 study of a novel NaV 1.8 inhibitor VX-nine sixty one. In sickle cell disease in beta thalassemia, we've now dosed 2 patients in our hemoglobinopathies program with our partner, Chris therapeutics using the novel gene editing therapy CTX001. The first sickle cell patient was dosed in the middle of this year, which follows the first patient about a new area for Vertex. APO L1 mediated kidney diseases, which includes FSGS or focal segmental glomerulosclerosis. There have been few to no medicines developed and approved for specifically to address the underlying cause of kidney diseases.
So as a nephrologist who has treated these patients, I find this program exciting both scientific and personally. Our approach to the treatment of APO L1 mediated kidney diseases will initially focus on the inhibition of APO L1 function in patients with FSGS. We estimate that there are approximately 10,000 people with FSGS in the U S, who are homozygous for APO L1 mutations. These patients exhibit high levels of protein in the urine known as proteinuria and typically progressed to reduce kidney function and or kidney failure. We've developed proprietary cell and animal models APOL1 protein function will reduce proteinuria and alter the course of this progressive disease.
I am pleased to report that we recently began dosing healthy volunteers in a phase 1 study of our first oral small molecule inhibitor of APO L1 function. This molecule known as VX-one hundred and forty seven for APOL1 mediated kidney diseases that we are advancing in late stage research. If we are successful in phase 1, Our plan is to initiate a phase 2 proof of concept study in 2020 where we would evaluate the ability of VX-one hundred and forty seven to reduce protein levels in would represent an important biological proof of concept We've made outstanding progress in CF and in multiple other disease areas in 2019 and are positioned to obtain important clinical data from multiple diseases in our pipeline in 2020. I'll now turn the call over to Charlie.
Thanks Reshma. I'm pleased to review with you our 2nd quarter financial results, which showed both strong commercial performance as a result of treating more CF patients globally and disciplined investment focused on internal and external innovation to create future medicines. All of the results and guidance I will discuss tonight are non GAAP. Our second quarter total product revenues were $940,000,000, a 25% increase compared to the second quarter of 2018. This increase was driven primarily by the uptake of SYMDEKO in the US and the recent launch of SYMKEVI in Germany.
Sim2Go and SYMKEVI revenues for the 2nd quarter were $362,000,000. The strong SYMKEVI launch in Germany represented the majority of $46,000,000 of SYMDEKO and SYMKEVI revenues from outside the U. S. As a result of new reimbursement agreements and new regulatory approvals for young children, We also continue to and A expenses were $394,000,000, similar to the $388,000,000 seen in the second quarter of 2018. The significant growth in revenues and disciplined spending in a 59% increase compared to the second quarter of 2018.
Net income for the second quarter of 2019 was $327,000,000, compared to 2.44 $4,000,000,000 in cash and marketable securities compared to $3,200,000,000 at the end of 2018. We expect to continue to generate significant cash flow throughout and we have a clear The results of our commitment and also by our increased use of capital to establish new collaborations and acquisitions aimed at the creation of future medicines. Over the past 12 months, we've invested more than $600,000,000 in cash to establish multiple new collaborations and acquisitions that provide us with access to new external scientific technologies, programs, and expertise in multiple diseases to complement our internal research engine. These activities and the significant expansion of our internal team dedicated to finding and securing new scientific opportunities underscore our commitment to investing in external innovation to support our future growth. Importantly, with our growing As a result of to 3,700,000,000 from the prior range of 3,450,000,000 to 3,550,000,000.
Our revenue guidance reflects anticipated revenues from countries where our medicines are currently reimbursed. Our financial guidance for both combined R and D and SG and A expenses and our anticipated effective tax rate is unchanged. We remain on a trajectory of significant revenue growth which is driving expansion of our operating margin and increases in net income. Importantly, our increasing revenues are allowing for significant reinvestment in internal and external programs to fuel our future growth with new medicines. Echoing Jeff's comments from the start of the call, vertex has never been stronger and is well positioned to continue executing on its strategy to drive value and growth through investment in serial innovation.
With that, I'll open
Our first question or comment comes from the line of Phil Nadeau from Cowen And Company. Your line is open.
Good afternoon. For taking my questions and congratulations on the progress. Just two for me. First on the financials for the quarter, there was a big step up quarter over quarter in the doublet revenue, the ORKAMBI, Symtaco revenue, and still not clear to me what exactly drove that uptick in Q2 versus Q1, would you be willing to delineate what factors drove that uptick? And then second on VX-eight fourteen, curious if you'd be willing to say anything more about the phase 1 profile you saw or the phase 2 trial design you're about to start.
Thanks.
Yes. So I'll take the first question, Phil, on the step up in revenues. Essentially, this was driven by a number of things. It was the ongoing launches of SYMDEKO here in the U. S.
And some Kevi outside the U. S, most notably in Germany where the team there has driven fantastic performance. So that's led to the growth of SYMDEKO SYMKEVI. And whilst that has cannibalized some of our ORKAMBI revenues, we've actually received a number of new approvals for lower range ranges for ORKAMBI and KALYDECO over the last few quarters. And as those launches are being executed, that's adding new patients in for KALYDECO and ORKAMBI as well.
So it really is a combination of expanded labeled indications for our older medicines, ORKAMBI and KALYDECO, and then the successful launch of SYMDEKO around the world.
Phil, this is Reshma. With regard to your question about VX-eight fourteen, that's the first small molecule corrector we've taken into AAT. We have completed the phase 1 study, which is a SAD, a single ascending dose and a MAD and multiple ascending dose what we saw there was a profile that looked really good from a safety and tolerability point of view that was, of course, the primary endpoint but also importantly around the PK. With regard to what we're going to do in phase 2, obviously, we need to have our discussions with the regulators, but what I can tell you is that, I expect the study to be of a very reasonable size end of a very reasonable duration, not dissimilar to what you've seen us do with CS. And I say that because what we're going to be measuring is AAT levels and activity.
That's very helpful. Thanks for taking my questions.
Thank you. Our next question or comment comes from the line of Salveen Richter from Goldman Sachs. Your line is open.
Thanks for taking my questions. So regarding the AAT program, you talked about looking at the endpoint of AAT levels do you think that liver histology would be required? And then how do you see the asset fitting into the treatment paradigm in light of different approach that are in development? And I have a follow-up. Sure.
Sure. So Salveen, you know that the data point that's available to us right now in pertains to the infusion, therapies, and what they used in their Phase III programs and what their approvals were based on is indeed AAT levels. And that's the data point and that's what's available to us. What I foresee here in terms of our AAT program, are a few, points that I I just wanna make sure I highlight 1, this is a small molecule oral corrector. So that's important.
This is oral. The second is that, certainly for the lung liver, sorry, for the lung AAT levels and activity will be important. And for the liver, I do expect that we're going to evaluate liver biopsies in phase 2 and that, we will need to have discussions with regulators with regard to how that fits into the label and what that program looks like. Let me ask, Jeff, to make a comment as well.
I think the second part of your question, Shelby, which is related to first is, is how does this compare to other approaches? And maybe just to remind you that AAT, as Reshma said, is, it's both a lung disease and a liver disease. The mutant protein is misfolded and accumulates in the liver and therefore it causes significant liver disease in up to 30% of the patients. And obviously it doesn't get into the serum in an active form. And so it doesn't protect the lung against auto digestion by, proteases.
So you have these 2 different organs that are involved and really successful treatment of the disease will require treatment of both liver and the lung. This approach, as Reshma said, is a small molecule, which has the distinct and sort of differentiated advantage of treating both by refolding the protein in the liver and clearing the liver. Now, we believe it'll have a positive effect on the liver disease. And of course, by refolding the protein into an active form of the serum, we expect it to have an positive effect in the lung. And I think you can see why we're enthusiastic about that.
If you look at our slides, this time we've shown you 814 in the past, this time we showed you 864, which is the next molecule for a longer period of time for 12 weeks now. And what you see in that slide in a mouse model that's actually expressing the human mutant protein is 2 important things. 1, we're able to drive functional levels of AAT in the serum well into the carrier range quickly that effect is sustained over 12 weeks. In fact, if anything, it increases as we go through the 12 weeks. And 2, with 12 weeks of therapy, we're really able see remarkable clearing of the liver, both the non aggregated forms of the blush and the aggregated forms, which are the punctate forms.
And so those are exactly the things the reason we're excited, exactly the things that we want to look for in the human. Most of the other approaches out there, as you know, either treat the lung. So for instance, the replacement therapy or they treat the liver, for instance, the antisense or, knock down therapies, that are out there, but they don't treat both. And so, the reason we're so excited about this is it's a small molecule approach that treats both at least in that mouth model, and that's what we'll be looking for as a ratio we described in the phase 2 studies, which can be a fairly small number of patients for a fairly short period of time.
Great. Thank you. And then on the call, you did discuss a couple of times today using capital for external opportunities. And are you thinking about smaller transactions like the one you just did with Axonics? And in the context of that, when you think of building a genetic center, do you see yourself sticking just to gene editing or would you expand into other modalities?
And then further, would it be these smaller transactions, or could there be a larger transaction in your future?
Sure. First of all, I don't want to call Axonics a smaller transaction. They might be insulted by that. We we saw it to be, you know, important and significant action, but I know of course what you mean. You know, as we've said before, first of all, we are accumulating, significant financial fire power capital on our balance sheet.
And so you should expect to see us do more deals and potentially larger deals. But the strategy will remain the same as it's been for the last 4 years. And as you know, we've focused on 3 areas. Anything in CF that could be complimentary, or we're additive to what we're doing now. With triple.
Obviously, we're not seeing many of those because the triple has set such a high bar, but we continue to look at everything out there. The second one is, technologies or technology platforms that would allow us to better treat the kinds of diseases rich, the one that you heard about, today either alone or potentially in combination with small molecules. And you've seen us do the CRISPR the deal, the Arbor deal, the Excan deal, all of those fall into that category. And then the 3rd area is looking for assets, mostly preclinical and early clinical assets that would complement our pipeline in the diseases we're interested in. In a way, Axonics was a part of that because DMD and DM1 or 2 diseases were interested in.
And we continue to look for those assets. I I think you can expect to see more of that with respect to the size of the transactions. We do have more firepower and so you could potentially see larger deals But what I think growth. We really don't need that given the revenue growth we're projecting out well into the 2020s from both the CF franchise and then the pipeline. Does that give you a better sense of what we're looking for?
Yes, that's helpful. Thank you.
Thank you. Our next question or comment comes from the line of Michael Yee from Jefferies.
On AAT, I just wanted to go, back to that in the past, rest month. If, you guys have a lot of confidence in the assays that you guys have used and are relatable or translatable that is through CF. Specifically as our bridge to what level that you could get in the human and then how long it would take for that to show up and and, and, specifically in a lot of communication.
Thanks for that. So, maybe let me talk about AAT and our level of confidence with regard to the assay and our approach. So with regard to the assays, that one's pretty simple. The assays for levels is
It it might be may you may be getting a lot of background noise. Maybe you could call mute.
I'll try and I'll try and speak over the noise. The assay with regard to AAT level, that one's pretty simple. That's a commercially available readily, accessible assay for levels. With regard to activity, that one is also well worked through it's in Eliza and, that is not something that we think is going to be particularly complicated. With regard to confidence, obviously unlike CF, which has already gone through our preclinical assays and through the clinic so we can look back and make those correlations with AAT we have yet to go into patients.
That being said, the reason we have confidence and the reason I'm very excited about taking this forward to phase 2 is The animal models we have, remember, has the human gene inserted into it. And whether we look at levels or activity in the mouse or we look at the liver. And particularly as we look at the liver over time, it just continues to impress us and raise our levels of confidence.
And then, Mike, the other thing as you know is that we know from sort of experiments of nature, that carriers meaning the parents of these, these patients are asymptomatic and they have reduced levels anywhere from sort of a 17 micromolar. Certainly, by the time we get to 17 micromolar, there's a lot of evidence that's highly protective. So we know the level that we're looking for in advance as Reshma said, simply by measuring levels of active AAT in these phase 2 patients, we get a pretty good idea of where we are with respect to treatment efficacy and carrier levels.
Our next question or comment comes from the line of Alethia Young from Cantor Fitzgerald. Your line is open.
Hey guys, thanks for taking my question. Congrats on a very good quarter and progress in the pipeline. I just wanted to kind of maybe take a step back and ask Keith a question around the pain program. I noticed you kind of are differentiating molecules. So can you just spend some time maybe discussing how you think pain and the certain indications associated with it might fit with your business?
And are you planning on partnering some of them or keeping some to yourself? That would be very appreciated. Thanks.
Alethia, let me start. This is Reshma. Let me just bring everyone up to speed on on where we are, and then I'll over to Jeff, to make some comments about, strategically where it fits into the business, partnering, and all that. So, with regard to the pain program, you know that, we have advanced VX-one hundred and fifty through phase 2b dose ranging and we've had positive results in neuropathic pain, osteoarthritis, as well as acute pain. The safety profile look good.
The tolerability look good, and that's one half of the equation. The other half of the equation goes back to our approach to CF as well as to AAT And that has to do with bringing forward a portfolio of molecules. And that part, as it pertains to, the new news for today, we're advancing VX 96 1, our next NaV 1.8 inhibitor into the clinic. So we're gonna wait for the results from that one and then pick the best molecule or molecule to advance into late stage development. If I try to maybe simplify and and raise the altitude, you know, we always talk about cracking the biology and then pouring on the chemistry.
In the paint program, the part of this that we're at is pouring on the chemistry. And what we're doing now is bringing our molecules forward, and we're going to pick the very best 1 or ones to take the late stage development. Geoff?
Yeah, Alethia, with respect to how we think about paying sort of strategically and commercially, which I think is your question, you know, we've said in the past, we really view it as multiple indications, even potentially multiple causes. But we see it as acute pain, which is the kind of pain that you have when you have a surgery or a toothache action or injury. That pay is treated mostly, not not entirely, but mostly in hospitals, pain centers, dental offices, etcetera. And you can reach most of those patients with a specialty sales force. And so we view acute pain, which is a multibillion dollar opportunity, is something that's certainly consistent with our Vertex strategy of make a transformative drug in the specialty area.
And obviously, the other driver in acute pain is that we're sitting in the middle of a horrible opioid crisis and the majority of the pain treatment for acute pain or opioids. And so we think having a molecule like 150 or 961 that would have opioid like efficacy without any of the addictive potential or side effects would be a very powerful transformative advance in the treatment of acute pain. That one, we will develop and commercialize ourselves. If you move on to neuropathic pain, which is the 2nd type of pain, very, very different. There's a diabetic and non diabetic component there.
It's also a specialty market. It requires slightly more, slightly larger sales force, but certainly when we could muster And the key there is going to be to demonstrate that one of our molecules is superior to the molecules out there like, like Lyrica pregabalin etcetera, which, as you know, are going generic. And so we're doing those studies as part of our phase 2 program. And then we'll be able to decide what the commercial strategy is there. And then the third area is what we call musculoskeletal pain.
It's what you would think of as low back pain sciatica. It's a huge market, as you know, a multibillion dollar market. That's a community market, for the most part. And that's a market that we we would not enter ourselves We have positive results in that market, but that's one where we would look to partner with a with a company that had a community sales force that we would not intend to build. We still think we can monetize this with them, but we wouldn't we certainly wouldn't do it ourselves.
So maybe that gives you a little clarity about how we think about these 3 different components of the market.
Thank you. Our next question or comment comes from the line of Cory Kasimov from JP Morgan. Your line is open.
Good afternoon, guys. Thanks for taking the question and congrats to both Jeff and Reshma on the news. So 2 for you. First on AAT, I know this standard strategy for Vertex, but can you describe the key differences between the 2 AAT molecules you have? Now is there anything that really stands out there?
And then secondly, I just wanted to ask about the triple and the potential of a future once daily. Did the selection of 445 over 659 Did that was the decision made to any extent based off of like early work in combination with your other next gen correctors? That you're working on or with VX 651 for use in that once daily combination, how important do you think a once daily option is at this point?
Okay. Hi, Corey. Two two very different questions. Maybe let me tackle the CF1 first and I'll go backwards and and do, AAT. With regard to, triple combination, let me take the first half of that and I'm gonna ask Stewart to comment on the importance of 1 daily.
So, no, the decision to select 445, versus 659 really has nothing to do with our ability to combine it with some of our other molecules. I think you're thinking about VX5 61 are deuterated ivacaftor compound that is itself in phase 2. The VX56 one, director could be combined with, VX-one hundred and twenty one, which is what it is combined with currently and it is in phase 2. But we could have, easily paired it with 445 or 659. Stuart, do you want to talk through once daily?
Yes, Corey, whilst, once daily is an advance for sure. And we certainly want to try and make things as easy as possible for patients to take our medicines. But much more important is the efficacy and safety of the triple combination regimen. And so it's definitely in advance. It's something we want to do to try and make things as easy as possible for our patients.
But going from twice a day to once a day is nowhere near as important as the levels of efficacy that we are delivering with the triple combination regimens. And then AAT, I'll hand it back to Reshma.
Okay. So with regard to AAT, VX-eight fourteen and VX-eight sixty four, preclinically, they both look very good. And obviously, we look at parameters pertaining to efficacy as well as safety, but there are also additional parameters that we've paid careful attention to, pre clinically. Those include things like formulation, ddi, PK, and, both VX-eight fourteen and VX-eight sixty four look really very good. The reason we're taking multiple molecules into the clinic is what we've learned, honestly, from CF.
And what we've learned is once you crack the biology it really is about pouring on the chemistry, and it serves as risk mitigation as we progress forward. So both 864 and 814 look very good. And, we're going to be moving those, as quickly as possible.
Our next question or comment comes from the line of Matthew Harrison from Morgan Stanley. Your line is open.
Great. Good afternoon. Thanks for taking the questions. 2 for me. 1, Jeff or Reshma, could you give us an update on the current status of your negotiations with various EU countries about reimbursement for your CF medicines?
And then, second on FSGS. Can you just talk broadly Is proteinuria a potential regulatory endpoint in that disease or how should we think about that as a biomarker that could be for from a regulatory standpoint? Thanks.
So, Matt, it's Stuart here. I'll take the question on reimbursement and then rest I'll take the question on FSGS and proteinuria. So as Jeff said in our prepared remarks, we have made some important progress in the first half of this year in securing new pricing and reimbursement agreements in various countries around the world, either for symptomsco, SYMKEVI or for our expanded indications for ORKAMBI and KALYDECO. There's a number of countries where we are yet to establish access, and that is a very, very high priority for us as a company. We're in active discussions with all the governments where we don't currently have access and our, commitment to securing access for our current and indeed future medicines is as strong as it's ever been.
Unfortunately, it's impossible to comment on exact when we'll be able to bring those discussions to a successful conclusion, but, it absolutely remains a top priority for us, and we remain committed to getting access soon as we possibly can. Reshma, FSGS.
All right. FSGS. So, with regard to what could the regulatory endpoint be and could it be proteinuria? I guess there's a few important points to raise. The first is that not all proteinuria is created equal.
What I mean by that is, regulators around the globe have actually thought about this issue, and have held workshops. And this is something that is often discussed in the renal community. And really where, we are is that there are certain homogeneous real diseases that lead to heavy proteinuria. And in those sorts of conditions, Croton area may well be an endpoint, that is, the one that is, important in the long run. Now there are many other diseases that are far more heterogeneous with levels of proteinuria that are smaller, and that's a different kettle of fish.
We have to go through our regulatory interactions. We have to have these discussions, and we're not there yet. But what I will say is that not all proteinuria has created a And, in my mind, when you're looking at a homogeneous disease, a disease like APOL1 mediated FSGS, which is a genetically defined condition. It is a very described patient population and the proteinuria that we're talking about is heavy with the consequence invariably being progression of the kidney dysfunction or progression to end stage renal disease, which really means dialysis or transplantation that, there's a lot of conversation to be had around proteinuria being the endpoint. I hope that helps
Our next question or comment comes from the line of Brian Abrahams from RBC Capital Markets. Your line is open.
Hi guys. Congrats on the quarter. Thanks for taking my questions and my congrats to Jeff and Reshma as well. A question on AAT and then a question on the kidney on AAT, any reason why 864 was tested for longer periods in the assays that you presented versus 814. And then on the kidney program, some recent data suggested that APO L1 RNA variants might have a more direct impact on site damage that leads to proteinuria.
So I'm just curious what drives your confidence that targeting the protein will reverse the pathophysiology. Thanks.
Yeah. Maybe I'll take take those, both. First of all, with respect to 864-814, no, there was no real reason that we had different time frames. And in fact, we've looked at shorter time frames for a longer time frames for 814. I think what you should take away from that is We've seen very, very consistent results with both of these molecules, which is one of the reasons why we're so encouraged and excited about taking them into the clinic.
So that's think there's that's pretty simple. Your second question was about, the RNA variance, yeah, enable one. So, yeah, let's talk to real quickly. Actually, recently, maybe talk about APO-one and what we know about the mechanism and why we're, why we're excited about what we've got there.
Yeah. Sure. Sure. So, let me try to break down April 1 mediated kidney disease. It's a genetic disease.
It follows an autosomal assessment patterns so you need homozygosity to get the disease. And maybe this thing that is the the most important to know is amongst African Americans who have FSGS, 70 plus percent of these patients have APO L1 mediated disease. So that's why this is, so important. And in the U. S.
Is about 10,000 people who have this. What we we understand the mechanism of, APOLL1 mediated disease very well. And we also the mechanism of our molecule VX-one hundred and forty seven very well. We've developed a host of, in vitro cell based assays, and we also have a mouse model with the human gene that we've inserted. And we really have a very, very good understanding of what happens with the protein, the next steps, how we are interdicting on this resulting in decreased proteinuria and the 75% that you see is is a very big number.
And the bottom line of all of this is the way you end the progression of kidney disease, the way you stop this is you need to do 2 things. 1, you need to target the underlying biology And 2, you actually need to decrease proteinuria because proteinuria itself further damages the kidney. And so that's sort of where we are and that's why we feel very good about our program. Jeff, I don't know if you have any other comments you want to make.
I think if I heard you correct is when you're asking specifically, do we believe this is an RNA variant issue? And the answer to that is not we believe it has very strong evidence, both pharmacologically and genetically and biochemically that this is a protein defect of the VA-one protein.
Thank you. Our next question or comment comes from the line of Paul Matteis from Stifel.
Thanks very much for taking the questions. To continue the trend, I'm going to ask 2 on AAT. 1 on the mouse data, can you talk about how early you're treating in the lifespan of mice where you're seeing this level of clearance in the liver, how much protein accumulation has already occurred And second, we had found a posting on the A180 Foundation for a study for VX-eight fourteen. Going on at the Covance Research unit in Dallas, looking at ZZ, mutant patients that was, looked like it was recruiting. Can you clarify if that study ongoing and is that something that could produce some data potentially on the sooner side?
Thanks.
Maybe I'll take the first one and Rachel will take the second part of that. This is Jeff. So we started treating these mice at about 1 month of age we treated them in this particular experiment we showed you with 864 for 12 weeks. And in answer to your question, if they're already protein accumulation, very significantly, yes, can see that actually, in the slide there and you see that protein accumulation occurring early and getting worse and worse over time in the in the control animals and essentially clearing or mostly clearing in the treated animals.
I think your second question was around VX-eight 14 and, some clinical trial, postings and such. What you can expect to see from us is the same, level of urgency that we worked on CF with AAT. And so you're right. We are starting, to, really mobilize our clinical trial efforts and, you may well see some postings for patient recruitment. I would anticipate that the data event with regard to when can we see some data from, people with ZZ, the ZZ mutation, I would say that that's likely to be a 2020 event.
Okay. Thank you.
Thank you. Our next question or comment comes from the line of Jeff Port from SVB Leerink. Your line is open.
Thank you very much and I appreciate you taking the questions. Stuart, just a couple on the core business. Could you just give us an update on where you are with the success of SYMDEKO in the penetration of the adult population carrying, Adele 508 allele, just to help us with benchmarking. And then related to that, would you anticipate the majority of those patients switching pretty quickly to the triple, should we anticipate that there is incremental patient volume available to the triple, or is it primarily going to be, the cannibalization of existing volume? And that's in the adult market in the U.
S. Obviously, individual geographies around the world will play out over time?
Yes, Geoff. So, SYMDEKO here in the U. S. In the 12 population, we are about 18 months into that launch now. That launch has gone spectacularly well.
The vast, vast majority of F508del homozygous patients are now being treated with either SYMDEKO or ORKAMBI because there are a large number of patients who have chosen to remain on ORKAMBI. So that launch is kind of very, kind of long in its life cycle, in, as you know, the life cycle of our launches in CF is pretty short that the uptake tends to be fairly vertical. And obviously, we're earlier in the launch, in ex U. S. Markets, but as Charlie said in his prepared remarks, the launch, for instance, in Germany is going tremendously well.
And there, we're now over 80 percent of that 508 homozygous patients are being treated with a CFTR modulator, either ORKAMBI or increasingly SYMKEVI. So the launches in the 12 plus population going very well, and that's largely what's driven the strong revenue growth this quarter. In terms of the number of patients who might transition, hard to predict until we get out there in the real world, but certainly given the strength of the clinical data that we have in terms of the additional clinical benefit patients see from adding in a third product are second corrected to SYMDEKO. I think that the demand is likely to be really, really strong that those levels of efficacy are truly truly incredible. And certainly the feedback we've had from the physician and patient community, both directly, and also through research would suggest that we're going to see very high levels of uptake.
In fact, if anything, it's likely to be most constrained by the actual capacity of the CS centers to be able to make that transition rather than physician and patient interest in getting on to the triple.
Thank you. Our next question or comment comes from the line of Mohit Benfield from Citi. Your line is open.
Thanks for taking my question and congrats to both Stefan and Rishma. Maybe would love to get your thoughts on the recent MRMA data we have in the translate, do you think the delivery what do you think of the delivery here? And what is the challenging part of delivering a micro RNA therapy I would love to get your comments on your own efforts with Moderna as well. Thank you.
Sure. Yeah. Thanks for the question, Mohit. This is Jeff. Obviously, it's a little too early, I think, to really make my of any comments about the data we saw today.
Very early data, one part of a trial, single doses, you know, very small numbers of patients I honestly can't really give you much of a comment, and we usually don't comment on competitors anyway. I certainly can comment on, what we think about nucleic acid therapy, our mRNA therapies, which, as you know, we're working on as well. We we do believe that ultimately they may play a role in the treatment of CF, but we also believe it's a very long journey. And the reason for that, as you just pointed out, is, is the delivery issue. It is very difficult to deliver to the entire lung to the right cells, which will come back to in a minute.
And in the case of mRNA to do that repetitively, which will certainly be needed. And while we're working on it, many others are as well, it's a difficult problem. And the problem isn't expressing CFTR. That's that, that's a relative easy problem. The problem is how you deliver it to a football field of of surface area in abundance and flame full of nucleases and other immune cells.
Get it into the right cells and then do it over and over again in the in the case of RNA. That's a really tough problem. And we've said we think that's 10 or 15 years away before we crack that them or others cracked that problem. Now the other issue that's worth keeping in mind is CF is not a lung disease. CF is a systemic disease.
That affects many different organs, including the pancreas, the liver, the GI tract, etcetera. One of the obvious advantages of small molecule CFTR correctors, like triple approach is they treat all the organs, which is very important and very beneficial for these patients, even when we work out the inhalation therapy or someone out the inhalation therapy for the lung, if it's possible, that will only obviously treat the lung. And so I think as a standalone therapy, these will be quite challenging. And then the final thing I would say is, you know, there are 2 different fundamental approaches here. 1 is some sort gene therapy or gene editing approach where you get into a stem cell, which can repopulate the airway continuously.
And the other one is you deliver it to the bronchodepithelial cells, but unfortunately, as you know, those turnover every few weeks. And so if you're going to deliver mRNA to the bronchodil cellular cells that will require, continuous retreatment, which has all sorts of immune and other inflammatory challenges itself. So we're very interested in this. We think it's a very hard problem. We and others are working on it.
I think it is a 10 or 15 year journey And unfortunately, these inhalation therapies probably won't treat the entire disease, they'll just treat the law.
Got it. Very helpful. Thank you.
Thank you. Our next question or comment comes from the line of Brian Skorney from Baird. Your line is open.
Guys. Thanks for fitting me in here. Just maybe if I could ask a question on the APO L1 program, is there still activity for this molecule for the different variants? And would you expect this to be equally effective for G1 or G2? And is the ultimate goal here for complete knockdown of APOL-one and are there any infectious risks that we should be thinking about for inhibition of APO L1 and would you expect to see reductions of wild type APO L1 in the healthy volunteer study?
Yeah. This is Reshma. I think, you're asking, a few different questions about what do we understand about APO L1, in our models and, what do we understand about how VX-one hundred and forty seven works? And so In general, we feel quite good and we have data in our models with both G1 and G2. So I do expect that when we go to the clinic and treat patients with APO L1 mediated FSGS, that, it would be, all comers of APO L1 mediated disease.
With regard to what do we expect to see in, with our inhibition. We haven't taken this to humans yet. So, it's difficult to say. But what I can tell you is, that in our animal models, we have seen good preclinical safety, good PK and the data we've shown you on the slide very good reductions in protein levels.
And would we just in the healthy volunteers, would we be looking at a biomarker in terms of wild type APOL1?
As you know, the the phase 1 FAD MAD study, the primary endpoint for that's going to be safety and tolerability the key, secondary endpoints going to be PK. And when we get to our dose ranging studies, when we're really going to start see the impact on proteinuria.
Thank you. Our next question or comment comes from the line of Whitney Ijem from Guggenheim. Your line is open.
Rachael, my congrats as well. Wanted to follow-up on an earlier question around gene editing versus gene therapy and some of the investments you guys are making specifically with the research center and bringing John Gray onto the team. So as we think about Vertex Investing in viral vector capability specifically, is that more around delivery, in gene editing or even RNA as we think about that, or or does that signal an in broader gene therapy applications going forward?
Yes, this is Jeff. So maybe just to remind you aren't as familiar as you are with what we have announced. So, we are very interested in both gene editing and gene therapy, not as pure therapeutic modalities. We're not going to become a gene editing company, but because the diseases that we're interested in, many of them are very amenable to gene editing or gene therapy approaches, or combinations of gene editing gene therapy with small molecules. And so we're really building a toolbox, a broad toolbox, of mRNA gene editing and potentially gene therapy approaches that we can use to address those diseases.
We're actually also very interested in learning how we can combine those with small molecule approaches. As part of that effort, we recently announced simultaneously three things. 1 was the expansion of the collaboration with CRISPR Therapeutics into ZMDMDM1. Simultaneously the acquisition of Axonics, which gives us great scientific expertise with Eric Olson, very important guide IP, very impressive preclinical data in the dog model and really accelerates our DMD and DM1 programs. And the third, as you mentioned, was hiring John Gray, who's really one of the world's efforts in making and manufacturing AAV vectors because AV vectors are obviously going to be very important in both gene editing and gene therapy approaches.
We plan to combine all of those into a new research site here in Boston, which we call Vertex genetic therapies. It'll have 150 to 200 scientists So, and it will have both the project teams around these diseases like the MD and DM1, but also, a preclinical and clinical manufacturing facility that will allow John to do, vector work, vector formulation, bioanalytics and preclinical and clinical vector manufacturing.
Operator, we have time for one more question.
Our final question comes from the line of Evan German from Credit Suisse. Your line is open.
Hi all. Thanks for taking the question and congrats on the strong quarter and my congrats as well to Reshma on your upcoming promotion. So one on the drug pricing front, do you see any risk to Vertex's U. S. Businesses with the recent proposal by the administration to allow importation of drugs from Canada.
And while Vertex has not been a focus of recent discussion on drug pricing, how are you managing risk of increased drug pricing pressures in the U S as this discussion is unlikely to go away anytime soon?
Yes, thank you for the question. Really a 2 part question. First with respect to drug importation, and I would also include in that, by the way, price importation because those are really both the same things. We believe very strongly in policies that do two things. Policies that encourage innovation to make more breakthrough transformative drugs and policies that then make sure that all eligible patients can have access to those breakthrough drugs, which is equally important for us.
When we look at the drug importation or price importation proposals that have been made, they don't meet either of those objectives. And in fact, we would argue that their counter to both of them. From an access standpoint, importing drugs from Canada doesn't solve the problem because there's not nearly enough supply to supply access the patients who need them in the U. S. 2nd, we feel there's a potential very significant safety issue of allowing drugs to flow across the border in an unregulated fashion.
And third, we're very certain that these kinds of policies will stifle the innovation that's led the industry here in the US to be the leading innovator to make new breakthrough drugs. And so we feel that that type of legislation is completely inconsistent with our principles. With respect to what are we doing for the future, I think the biggest thing we're doing for the future is to make sure that we're making transformational because at the end of the day, these are the kind of drugs that patients and payers want to pay for, and they want us to invest in. And the best evidence of that is our CF programs here in the U. S, where we've seen very rapid reimbursement from all forms of payer, including government as Medicaid Medicare, as well as the commercial payers.
And the reason for that simple, they understand the value of those medicines to patients, and these are the kind of medicines that they actually want to pay for. And I think when you look at our pipeline, as Rachel would describe it, what you see is exactly the same kinds of medicines for serious diseases like sickle cell disease, paying AAT, APO-one. That's the most important thing. Obviously, we talk with politicians and lawmakers to explain the value of innovation. We have programs to do that.
But the most important thing we do is to actually do innovation and invest in it because I think that's how we protect the value for patients and shareholders.
Great. Thank you.
That concludes the Q And A period for today. I'd like to turn the conference back over to Mr. Partridge for any closing remarks.
Thank you, operator. Thanks for tuning into our call. If you have additional questions, the Investor Relations team is available for a follow-up in the office tonight. Have a good evening.
Ladies and gentlemen, thank you for participating in today's conference. This concludes the program. You would now disconnect. Everyone, have a wonderful day.