Great. Thank you very much for joining us today. It's right before the lunch session, probably. My name is Mohit Bansal. I'm one of the Biopharma Analyst here at Wells Fargo, and I'm joined by Vertex team today. We have Susie Lisa, Head of Investor Relations, and we have Manisha Pai. She's Executive Director of Investor Relations, at Vertex. Thank you very much for being here.
Thanks for having us.
Awesome. So maybe, like, before we get started, I mean, there's a lot to talk here. Can you talk a little bit about, like, set the tone with, like, you know, what is the discussion topics right now and what you're excited about for next six months or 6 - 12 months, which investors should be focusing on?
Sure. So I think that it feels like it's always an exciting time at Vertex, to be honest, right? Right now, we are executing very well, I think, on three ongoing launches with Alyftrek, our fifth market in CF medicine, with Casgevy for sickle cell disease and beta thalassemia, where we continue to make very nice, steady progress. And then the early days of the Journavx launch, the first non-opioid for pain, the first new therapy for acute pain in over 20 years, really exciting in terms of the progress we made. And I'm sure we'll get into that in some more detail. So it's this new era of commercial diversification and commercial execution, which I think is off to a very good start, that combines with our historical excellence, I think, in terms of R&D execution and pipeline execution, right?
So, as I mentioned, fifth CF medicine, now diversified into three additional disease areas, and we have four ongoing phase III studies, as well as a fifth to start soon. So expanding into kidney diseases with two ongoing phase IIIs for Inaxaplin for APOL1-mediated kidney disease, with Pove in Immunoglobulin A nephropathy. We also are close to completing the enrollment and dosing in our phase III study for zimislecel, which is the old VX-880 for type 1 diabetes, with truly outstanding effect, and then we have our ongoing DPN phase III studies for expanding into peripheral neuropathic pain indication. Then there's a pipeline behind that, with products soon to be or currently initiating phase II study, proof of concept studies in ADPKD, autosomal dominant polycystic kidney disease, as well as ongoing work in myotonic dystrophy type 1 in patients in the clinic, and then more behind that.
I think combining those two areas of excellent execution, both in terms of R&D and our differentiated strategy, focusing on sandbox diseases, where we understand the causal biology and hopefully leads to greater rates of success, as well as what is the early days of commercial and revenue diversification. It's a really exciting time.
Awesome, so maybe, like, I mean, there's a lot going on, so I can go in any direction, but let's just begin with the second quarter call here.
Sure.
So there were two different topics, which kind of made people a little bit nervous, and we saw that in the stock reaction as well. Can you talk a little bit about the regulatory discussions where, I mean, it was like, again, you were discussing with the FDA that there is a, is there a path there, but can you talk a little bit more about, for the investors, like, what you were discussing and how the discussions unfolded there?
Sure. I would say a big dislocation in the stock after the Q2 call.
Right.
I think, regardless really of the very good early data on our launches commercially and a really good financial quarter execution-wise. But I think the main disappointment that investors heard from the call was the fact that our next steps in terms of, reaching, the market commercially in the U.S. for peripheral neuropathic pain will be through a DPN, diabetic peripheral neuropathy indication, and that we're starting imminently a second phase III study there. There are 10 million patients, 10 million +, peripheral neuropathic pain patients in the U.S., and our goal is still ultimately a broad neuropathic pain label. But at our end of phase II meeting at the end of July, the FDA had invited us in to talk about that potential. They have only ever previously granted single indications in peripheral neuropathic pain.
We came in and had an excellent, robust discussion, but it was clear that they weren't there in terms of granting a broad label with our proposal to do one DPN phase III and one lumbosacral radiculopathy or LSR study that would not lead to a broad PNP label. They are still thinking more in terms of, etiology, right? There are many different causes of peripheral neuropathic pain: toxins, cancer, metabolic diseases, et cetera. And so, although we feel strongly that our mechanism of action addresses all these different causes, and hence our goal of a broad label, the FDA is not there yet. And so what was clear from that discussion is that doing, as per their past history, two studies in one indication will lead to a label with that indication, and then subsequent follow-on studies, single study could lead to add-ons to that label.
So hence our decision to not proceed next with a phase III in LSR, but instead do a second phase III in DPN, to get that indication as quickly as possible and then add on from there. We don't yet know the next steps. The FDA may be open pending additional considerations to smaller basket studies, maybe polyneuropathies or a mononeuropathy, or it may just make sense for us to go and do a single study in the next indication. That's the work that we're still ongoing. But we ultimately do see potential for the whole 10 million patient population, but very near-term focus on the 2 million + that have diabetic peripheral neuropathy and executing on those studies, which are well-understood, well-trained clinical sites, understand the treatment effect, how to manage placebo effect, et cetera.
What we said is that our plan is to complete enrollment in both of those phase IIIs in DPN next year in 2026.
Got it. So the path for the broad indication is not closed yet, but you need the DPN as an anchor indication and then just build on that. Is that?
That's exactly right, and with high visibility on the pathway to DPN, which I think is some of what got lost, people felt that the feedback had been, you know, anti-suzetrigine or something, and that is in no way the case, and we have high visibility on the pathway in DPN and are going right about executing that as quickly as possible with a goal still for the broader population over time, pathway still to be determined.
Got it. So again, that brings us to the second question. So how do you think about the, like, what are you doing to make sure that you have the highest probability of success in DPN trials, given that, you know, if you look at Lyrica's history, it was hit or miss because, you know, the problem with these subjective trials is that placebo can be.
Sure.
Can be strange here. So what are you doing to make sure that, you know, you have the highest probability of success here?
Yep. Good question. I think that DPN is much better understood than, say, LSR, which had never been a phase III study in LSR, for example. There have been multiple phase III studies in DPN. There are clinical trial sites that are well-trained in the condition, as well as how to manage placebo. There is very well-understood magnitude of treatment effect for the active agent, as well as the placebo arm. By using these well-trained sites and established protocols and confidence in our mechanism of action, that's what leads us to high confidence in the probability of success for our studies.
Got it. So you have one trial which has active control, but the other one is just placebo control, right?
The second, that's correct. The second phase III will be a little bit smaller because it will just have the placebo arm as per FDA protocol and what's required for the indication.
Got it. So can I talk a little bit about, you know, the timelines of this? Because one trial you have started early and then the second one you are starting now. And I think we chatted before that, I mean, there's this trial conduct issue because you don't want a subjective trial to read, one trial to read out fast versus others. So how should we think about the timelines at this point? Can you just make them together versus?
Sure. I don't have a full answer for you yet.
Sure.
All we have said is that we do expect to complete enrollment in both DPN phase IIIs next year. The first one, you're correct, as you said, actually began in December of 2024 and has been enrolling at a very fast pace. We're pleased with that. The second one will be slightly smaller, but we will be using, to your prior question, we will be using the same well-trained sites to ensure probability of success, so at some point, it becomes a decision as to which trial to allocate patients to.
Right.
We may decide to accelerate and complete one. We may decide to manage them both so that they end on a similar timeframe so you don't have to worry about ultimate results impacting the second studies. But it's still to be determined, so I don't have an answer for you beyond completing enrollment in both next year.
Got it. Got it. But yeah, like, affecting the other trial's data results because of the first trial readout could be a consideration.
That's right.
Right.
That's right.
Very helpful. And then, another topic is the 993 trial. I don't know if that was the main reason for the stock weakness, but again, that trial in the acute pain did not show benefit. So it's supporting drugs. So what is the takeaway internally from that trial, and how does this impact the neuro, the peripheral neuropathy trial or DPN trial that you are running with 993 at this point?
Sure. So I think that what, perhaps why there was what felt to us like a disproportion itself, I think it was primarily related to concerns about the ultimate peripheral neuropathic pain potential. But then in VX-993, a next gen that was being studied in bunionectomy in acute pain, we did see a similar size treatment effect, but had hoped for more essentially based on what we had seen in terms of the potency and efficacy. But what we learned, and I think probably in hindsight on IR, we should have framed better, is that going higher up the curve did not get you greater treatment effect. Essentially, we are getting all we can hope to get out of suzetrigine, out of Journavx by inhibiting the NaV1.8 channel.
Right.
Although VX-993 certainly remains a viable option in acute pain for IV because it can be formulated as IV, as well as potential combination use with a future NaV1.7 inhibitor, as can Journavx, that we won't be advancing it in acute pain as monotherapy because we are getting what we need to get out of or what we can get from inhibiting that channel with Journavx. But the ongoing phase II in DPN will run that study out with VX-993, see what we learn about dose response curve. There is some accumulation and slight differences and added to the body of work. But I think perhaps, investors have seen what we've done in CF and thought perhaps serial innovation is, is very, very easy, and there's always an obvious next step.
This was more to validate our belief in terms of what we're getting by inhibiting 1.8 and the potential to now move to inhibiting 1.7, which actually triggers the pain sensory reaction, and then potentially combo use by inhibiting both the trigger and the propagator 1.8 that you could ideally have a synergistic effect. So that's the direction that serial innovation will take from here. So.
That's what you have done with CF as well, starting with Kalydeco and then adding on top of that, right?
Yes.
It makes sense actually. Let's just talk about, you know, like, Journavx a little bit. You know, you have been open about, you know, first half is going to be, like, volume-driven and sales will follow the volume growth. Considering all that, I think second quarter was pretty good actually, at least in our opinion. How are you thinking about, I mean, like, do you agree with that, with the progress you have made at this point? And then talk a little bit about the sales effort that you are increasing for Journavx launch at this point. I mean, was that already planned or is this a reflection of what you are seeing in the marketplace at this point?
Yeah. So thank you for that. We have been pleased with the early results. If you go back prior to launch, I think there were many who said, not you, Mohit, but many who said, "You will never, no one will ever pay for this when you can get generic opioids, right, for pennies on the dollar." And I think what we have proven is that, yes, Vertex does know what a PBM is and how to talk with them, as well as the fact, more seriously, that there is a true unmet need for additional mechanisms of managing pain in the marketplace and a non-opioid option that doesn't have the side effects nor the addictive potential. And so it is a long game that we're in for the long run here.
I think we've been pleased today with slightly faster than expected, potentially, progress with payers. We have two of the three largest PBMs under contract, and we continue to expect we have high visibility on adding the third before the end of the year. We have the two largest hospital group purchasing organizations with contracts. As of the Q2 call in early August, we had said we have 16 state Medicaid plans and continue to make progress there as well. I think from a reimbursed access standpoint, it has been very good progress. The other important barometer is with respect to getting on hospital formulary, right, and going through the P&T committee process, which can take anywhere from 6- 18 months.
We've tried to accelerate that process where we can and are pleased there that we're on about a very good portion of hospitals either have us on formulary or discharge order sets or are ordering Journavx as of this time, then it is the field force reach, our virtual sales team reach, and then our targeted media outreach, and there too, I think that we are looking for the long run success here and trying to build as broad a foundation as possible, so we're trying to go very broad, consistent with the labeling in terms of physician type, setting of care, pain type, et cetera. We've been pleased with the breadth of physician prescribers that we've seen, anesthesiologists, pain specialists, general surgery docs, orthopedic surgeons, et cetera. We've seen nice uptake from dentists, if you will, so really broad range there and seeing good rates.
It's still early, but good rates of repeat prescriptions as well. And that's where we are seeing things being promotionally sensitive. And now that we have gotten to a point in time where we do see broader access in terms of reimbursed coverage, as well as increasing formulary adoption, now is when it makes sense to add more from both a marketing and a field force standpoint. We want to think about the initial 150-person field force rep size, that though they'll continue their focus on the top 150 or so IDNs that we're focused on, but in terms of physicians, some of those in sort of they're covering tier one. Beneath that was the virtual sales force. They'll move up more of them, and the new team will cover those folks, and then another bucket will come into the virtual sales force team.
Got it.
So, but to go out with that biggest sales force initially, when you didn't have fully reimbursed coverage and you weren't on formularies, that probably would have been too soon. So we think this timing is what makes the most sense. But pleased with the breadth, with the physician reaction, with the patient anecdotes that we've heard, I think it's off to a really strong and encouraging start.
Great. Are you seeing uses outside of the hospital setting or surgical setting as well at this point, or mostly?
Maybe I don't understand your question, but about the.
The label is broad, right?
Yes.
So, but I mean, your target is in the post-surgical setting at this point, but are you seeing usage outside of that as well at this point?
So this, the mix of the scripts is about 65% in that discharge at home setting and about 35% in the hospital or ASC setting, if I'm getting that. But then you do see, as I mentioned, the dental setting and some other things, if that's your question.
Right.
But very strongly, I think given the concerns about opioids and pain management, we see a big role for this in at-home, post-surgical care.
Do you see a role for DTC campaign, things like that, for these kind of medicines?
I think, in a very targeted, more direct-to-patient way. You know, today, if you are in an ER or you're looking online for information about a hip replacement, you're likely to hear from us about, "Have you thought about your pain management strategy too?" and we have non-branded celebrity campaigns there with Alex Smith, a former professional quarterback, who had a horrible leg injury. Look for more on that front from us, potentially in a branded capacity and more and more targeted ads through micro-targeting, think streaming services, etc., as opposed to the, you know, not a Super Bowl ad, that type of thing, but trying to be savvy and efficient with our spend, but doing more and more of that in addition to, as I mentioned, as we mentioned on the Q2 call, the expanded field force.
Got it. Very helpful. Thank you for that. Maybe we'll, again, anyone if you have questions on the call, please feel free to ask those questions. Let's just move to CF, the core business you have. I think the business is strong and I mean you have a long tail as well. How should we think about the next leg of growth here? I mean, Alyftrek conversion is one. I mean, you did like that was also a missed thing from second quarter call that conversion actually accelerated for Alyftrek as well in second quarter. But there is Alyftrek, but again, do you like you are well penetrated in those spaces. So where is the next set of growth coming from and how should we think about Alyftrek conversion going forward?
Sure. Thank you for the CF question.
Yeah.
So I think we do see continued growth ahead for CF overall, while we don't give long-term guidance. Some of the drivers of that growth include new approvals and reimbursements, particularly in younger patients. So Trikafta is approved down to two years old now, Alyftrek down to six years old. You know, we're working toward one to two for both of them, I believe. So getting down to younger patients, approvals and reimbursements, uptake still in our core markets as well as in some of the newer geographies that we started talking about this year. Those are countries where we have relatively recently secured formal reimbursement where previously it was, you know, named patient programs or things like that. And those are countries, let's say, like Brazil. And then, of course, the Alyftrek global launch.
So we're approved for six years and older in the U.S., Europe, U.K., and Canada. OUS, we are still working through that reimbursement process, but, you know, that's to be expected. We have reimbursement in England, Ireland, Denmark, and Germany, I believe, for Alyftrek, in Europe. And that's sort of how we see it. But also the overall market is growing as patients are living a lot longer than they used to, partially thanks to CFTR modulators.
Got it. That's very helpful. And then with Alyftrek, I mean, so how should we think about the conversion? Because, you know, at one end you have Trikafta, which actually converted very quickly.
Mm-hmm.
I mean, Alyftrek is not on that trajectory, but, obviously the label update is probably one part of it. But how are you thinking about longer term? Will we get to a Trikafta level? I mean, internally, how do you think about that? Because it is going up against a really good drug though.
Yeah. Yeah. Absolutely. And so I think one thing to keep in mind is that when Trikafta was approved, our first triple combination, we went from having medicines that could treat about 50% of patients to all of a sudden having one that could treat around 90% of patients at that point. So there was this large initial bolus, whereas the populations, the patient populations for Alyftrek and Trikafta largely overlap. There are some additional mutations that respond to Alyftrek that don't respond to Trikafta. And some of the most rapid uptake, in fact, that we've seen in the U.S. has been among those patients for whom they're newly eligible for a medicine now with the approval of Alyftrek. And then in terms of conversion, we do expect the majority of patients to switch from Trikafta to Alyftrek over time.
You know, in the U.S., we do have that additional liver monitoring requirement in the label, which is, for the first six months of treatment, a patient has to have monthly liver monitoring. It's a simple blood test. You can get it done at your local Quest Labs or wherever. You don't have to go to the hospital. But it is a logistical consideration that patients are, you know, working through with their physicians and how to manage that with their day-to-day lives. In the OUS markets, Canada, U.K., and Europe, there is no additional liver monitoring requirement in the label. So it's quarterly for the first year and annually thereafter.
Got it. Very helpful.
Oh, and one thing to add there, you know, on the Q2 call, we talked about that uptake that we've seen to date. And as I mentioned, the most rapid uptake has been among those rare mutations that did not have access to a therapy before, followed by patients who discontinued a previous CFTR modulator and were no longer on treatment. Makes sense that these two populations would be, you know, in the front of the line there. But the vast majority of patients who are on Alyftrek, as of the Q2 call, are patients who switch from Trikafta because that is a much bigger pool to draw from. So we are pleased with the progress we're seeing on all three of those groups.
Got it. For a new patient, there's no reason to not go on Alyftrek right now, probably. For a new, new CF patient, is that?
Yes. Yeah. I mean, we do believe that Alyftrek is the best CFTR modulator for eligible patients based on the data in the phase III studies on CFTR function, as well as the once daily dosing. So yes, I would imagine that.
Got it.
That would be the choice.
Another question. We get a lot, and I'm sure you have received a lot. I mean, the MFN part of it. I mean, you were not among the companies which got the letter here, and you are catering to a rare disease here, even though you have a decent Medicaid exposure. So what is your internal thinking about this? There's not a lot of detail here, but again, would love to know what you're saying.
Yeah. I think a lot of advocacy work on our part, behind the scenes, trying to stay as up- to- date and understand and being planful in advance, which can be challenging given lack of, lack of details. But we were not one of the initial 17 that received a letter. I think fundamentally part of our view is that by focusing on serious diseases and trying to deliver a transformative effect, that that ultimately can position you better overall, in terms of any type of reimbursement or pricing pressure, if you will, and that would continue to be our hope, but it really is a stay tuned, but remain very active in D.C., as well as very active planning for whatever potentially might happen.
Got it. Very helpful. Thank you for that, so maybe let's just move on to the other exciting pipeline, the kidney space, right? I mean, you have made good strides there. Two major trials are read out next year, so let's just start with Pove, Pove in IgA nephropathy. You have, like, so far with early data look best in class, but at the same time it is a crowded market, so how are you thinking about your drug? Would you be able to differentiate on the proteinuria alone, or how should we think about when we see the data and your confidence level in terms of positioning of this drug?
Yeah. I think that we, as I mentioned, have this very rigorous sandbox disease approach and understanding the causal biology. I think as the science developed around B-cell mediated diseases that we did a very thorough survey of the landscape and understanding the data and the candidates, and I think felt strongly that Alpine Immune Sciences and Pove offered the best opportunity for differentiated B-cell control and hence the acquisition in April of last year, and with respect to IgAN, I think also an understanding that in this type of market where patients can switch, right, that it isn't always first entrant that ends up with dominant share, and our hope is to be best in class, if you will, on two significant buckets. One is the clinical data and the differentiation, and secondly are the patient-centric factors.
So in terms of the clinical data, we think the dual inhibition of BAFF and APRIL and the targeted design of Pove, the data preclinically and clinically, yes, we're still early in terms of showing only phase II data, but we have seen differentiation in terms of depth of response with greater reductions in UPCR. We would hope to be able to sustain that in our phase III study. We've been pleased with the pace of enrollment. We said that we had completed the interim analysis cohort enrollment on our May call. Then with 36 weeks of follow-up from that, that would position us to release data on the interim analysis in the first half of 2026. On the Q2 call, we said that we expect to complete enrollment of the full study by the end of this year.
I think seeing good receptivity from physicians and that can always, I think, be an encouraging biomarker of underlying optimism or demand for the product. We'd hope to continue to sustain that depth of response and best in class profile of optimal B-cell control. On the patient-centric factors, we're also differentiated with lower dose, small lower dose Sub-Q auto injector at home only every four weeks. Having the combination of those factors plus the best B-cell control, we hope would lead us to a differentiated profile. We also hope to have multiple indications, so nephrologists wouldn't have to learn different meds for different indications and go from there. A strong understanding internally of this type of market as well as the kidney space is what led us to the Alpine acquisition.
We continue to only be more and more encouraged by that deal as time goes on.
Got it. Well, that's very helpful. Thank you for this. Maybe, like, can you please set the tone for the other phase three readout? And I don't know if it is next year, but again, you plan to finish enrollment this year. So it's like one year for the Inaxaplin data. So can you help us understand, like, what to expect when we see the data next year or maybe early 2027?
For Inaxaplin?
Yeah.
Sure. So Inaxaplin is our ongoing phase III study in APOL1-mediated kidney disease. This, I should have mentioned in IgAN, right, a significant patient population. I think it's north of 300,000 in the U.S. and Europe, north of a million globally. We've partnered with Zai Lab in China and Asia regions and then Ono in Japan and associated regions there. So we are seeing good uptake there with IgAN. With APOL1-mediated kidney disease, excuse me, about 250,000 patients, both in sort of primary AMKD, if you will, and then those with comorbidities. That study is on track to complete its interim analysis cohort enrollment by the end of this year. Once that is completed, then it is 48 weeks of follow-up before we can have the interim analysis.
Depending on timing, we'd be hopeful you could see data next year, but still need to determine when that final patient in the interim analysis cohort is enrolled. Really no competition here, nothing that's going after the causal biology of this disease. We saw very compelling phase II data, and would hope to continue to see that. I think too, we've been encouraged by the uptick in the pace of enrollment, which led us to giving this milestone to complete the IA cohort enrollment because of all of our great work in terms of developing this market and awareness and trust with this community, given that it's a disease of those of African descent.
Working with Alonzo Mourning, the NBA All-Star who had the disease and needed a kidney transplant, but working with community groups, church groups, et cetera, and that, and as well as physician awareness and, and opening additional trial sites has led to the accelerated enrollment.
Got it. Very, very helpful. And then you have some of the proof of concept trials as well for some of the assets, like VX-407, VX-670 in DM1. So can you talk a little bit about the timing of those if you have this cohort?
Yeah, sure. So, VX-670, we're studying it, as you said, in myotonic dystrophy type 1 or DM1. That's in a phase I/II single ascending dose, multiple ascending dose study in patients. We are in the MAD portion now, and we expect to complete enrollment and dosing in the first half of 2026. And then for VX-407 in a subset of ADPKD patients, we are in the process of initiating the phase II proof of concept study.
Got it.
If I could also go back to Pove for a second, Mohit, that we've talked about primary membranous nephropathy. We'll begin a phase III study, that by in the second half of this year. And then on the Q2 call, we said that we have identified additional indications, one in WAIHA, and then also in generalized myasthenia gravis. And so different phases there. We'll let the full set of Ruby 4.0 data mature through the end of the year, before next steps in WAIHA, but are excited about that in warm.
Autoimmune.
Autoimmune. Sorry. Let's just leave it at WAIHA. Sorry. And that's probably about 35,000 patients here in the U.S. and Europe. So an interesting opportunity. And then in generalized myasthenia gravis, next steps will be go to FDA and talk to them about what the next steps need to be there.
I feel like a Pove analyst is coming with like a big slide deck of 50 slides probably at this point.
I think that we're excited for the American Society of Nephrology in November. And, stay tuned.
Got it. Very helpful. Okay. So last question. I asked this question to everyone, so fast forward one year. I hope you are sitting here. I hope I'm sitting here and I'm asking this question. What would make you look back at the year and say it was a great year for us?
I think that it will be, you know, continued growth and expansion of new patient groups in CF that you will see, continued patient uptake in Casgevy, where we've been pleased there, and expansion into the Middle East as you have seen. Journavx with full reimbursed coverage in the U.S., right? We mentioned 150 million lives on the Q2 call in the U.S., 85 million of those, with no prior authorization and no step edit. So continuing to grow that number and getting closer to full coverage or being there and having been able to pull back the patient support programs that we're currently offering. So, recognizing significant revenue from that, from all three of those disease areas.
And then, you know, having great data in hand, essentially from Pove and IgAN initially, or getting close to data release, if you will, in AMKD and having regulatory filings in T1D. And I think that's enough to get us started with. Yeah. But a lot of really exciting milestones between you know over the next 12 - 18 months at Vertex and looking for continued excellent commercialization execution.
On that high note, thank you very much for coming here.
Thank you. Thank you again.