Afternoon, and welcome to the second day of the Cantor Global Healthcare Conference. My name's Carter Gould. I cover large cap biopharma here at Cantor. I am pleased to welcome Vertex to the stage. Joining us from the company, Susie Lisa and Manisha Pai from the IR squad. Plenty of momentum in the past 12- 16 months. Cystic fibrosis leadership's been sort of reaffirmed most recently and tangible progress on the povetacicept upfront. From our perspective, the CF and pove story has been pretty easy to tell, but as I like to say, there's lots going on with pove beyond IgAN. There's lots going on in renal beyond pove , and there's lots going on ex-CF beyond renal.
That's right.
Looking forward to discussion, hope we can touch on a whole number of those topics. I guess maybe to just kick things off, Susie, you had a very high-profile acquisition announced most recently. I think the timing of that raised a lot of questions and would love to kind of just hear why is the right time for you guys to make such a notable high-profile acquisition and really add to the diversification efforts?
Great. Thanks, Carter. I appreciate your having us and a great question to start with. I think as many people know, the Vertex story from an investor standpoint sometimes is more difficult to tell because there isn't a clear therapeutic category or a platform. Instead, we adhere very strictly to our R&D strategy, which has these set criteria. A few of those criteria include things like understanding the human causal biology. Are there validated biomarkers? Is it a specialty market? Are there streamlined pathways in terms of regulatory and clinical development? We apply those criteria so strictly to any disease area we pursue internally, as well as any acquisition we consider externally.
Now, if something fits in what we call these sandbox disease areas, and it can help accelerate one of our existing programs, we go after it like Entrada and DM1 is a good recent example. Or if we don't have a presence in a disease area that we've identified and we see an asset that can launch our presence into that space with a differentiated product like Alpine or like Crinetics, then we move forward aggressively on it. I think that we executed this deal from a position of strength, right? We're expanding our leadership in CF. You're seeing good commercial uptake on CASGEVY and JOURNAVX. We're on target for $500 million+ in revenue from both of those products this year. The renal pipeline, as you mentioned, is really exciting.
But this rare specialty endocrinology space, where what you measure in phase II is what you measure in phase III, right? It feels very de-risked to us, and we love the call point and think a lot of our learnings from our CF commercial expertise can be deployed for Crinetics and that, like we did with Alpine, we can hopefully accelerate some of the launch timings or expand the global footprint, et cetera, and bring our expertise. So when we see something that we identify, we move aggressively to get it before. We don't feel like with Alpine, if you recall, there were a lot of assets. We were confident in our due diligence and moved forward the one that we thought was potentially best in class. With Crinetics, it's the same sort of story.
Okay, so with now such a sort of multipolar kind of narrative for Vertex, how do you sort of frame the strategic priorities for the company into the end of the year and into next year?
Yeah. So we are excited to be now with the closing Crinetics last week, right? We talk about these disease area pillars, so commercialized in obviously CF as well as hematology with CASGEVY and acute pain. Now with PALSONIFY's launch underway in acromegaly in rare endocrine diseases. Then we look very much forward to a PDUFA date of November 30th for povetacicept in IgAN. So that'll be the first launch in our fifth pillar, if you will, in renal. With three programs behind that, we're excited for that. So the pove PDUFA date is a key milestone, November 30th. Before that, though, I would say you're likely to get the phase II proof of concept data in essentially a patient population expansion study for inaxaplin. That's the AMPLIFIED phase II study. It's a phase II study of about 50 patients. All patients have two APOL1 alleles.
About half of them have more modest proteinuria than you see in the pivotal study, AMPLITUDE, and about half of them have a heavier proteinuria but Type 2 diabetes. We see this as separate and above from the AMPLITUDE pivotal study. That catalyst technically slides into 2027, but you will get that interim analysis of the phase III study in early 2027. That is about 150,000 patients. This study, separate and above, would be an incremental 100,000 patients if you were to see positive results from AMPLIFIED. We are excited for that, and that is probably the nearest term catalyst, then the pove IgAN that I mentioned. Also we have promised phase II proof of concept data in our myotonic dystrophy Type 1 program before the end of the year, as well as a look at the first of our next gen 3.0 CF portfolio of products.
That is VX-828. I think those are the key milestones before the end of the year. Also we will complete enrollment in our two phase III studies in diabetic peripheral neuropathy in our chronic pain franchise. Those studies are both 12-week studies, and so you could look at data, say maybe by mid-2027. Happy then to go into the outlook in Type 1 diabetes and some of the other areas that we have too. But those are the key near-term catalysts as well as continued commercial execution.
Yeah. I think that teed up most of the rest of the conversation here.
Okay.
But maybe before we jump down any of those sort of alleyways, one thing that we get asked all the time is, or oftentimes we go down this, is really understanding how much the company has really matured over the past two to three years. I think for folks, sometimes the development on the commercial side has been maybe lost in the mix a bit. So maybe just lay out how that commercial infrastructure has evolved since you guys were solely a CF story not too many years ago.
Yeah, I think that's a really good insight. I think sometimes investors think, sometimes we even joke CF sells itself.
Yeah.
That's not the case, right? It is a very efficient model. I think there are a lot of learnings from CF, particularly on the patient support side of things, that we can leverage into other areas, like I mentioned. I think the company has evolved, right, initially with the hiring of the sales force and support structure around CASGEVY, right? With a very long patient journey, and a lot of support that's required both at the authorized treatment center level as well as for patients and their families for a functional cure, like truly transformative therapies. These people are in the hospital two or more times a year, and now they're not. So hiring the sales force for that, completely separate and distinct from CF, and then the learnings going into a mass market like acute pain with 80 million prescriptions, right?
Initially starting with about 100 field force reps there, 150, while we were building up the reimbursement and access there. We doubled that field force earlier this year in the March-April timeframe as more reimbursed access came online and have been adding things like marketing initiatives, directed TV content on streaming services. If you search for total knee replacement, have you thought about your pain therapy as well, right? Celebrity spokespeople like Jayson Tatum and Lindsey Vonn, right? And educating about the total cost of the opioid crisis, the pain crisis because people are undertreated, et cetera. I think a lot of maturation and growth, and what we're excited for is Crinetics comes with its own sales force for the specialty endocrine space, and then in renal, we are ready to go.
This is really the first time where you will see synergies in the sales force, if you will. It's not why we did it, but with four programs in renal, IgAN to be the first, we see sort of a great halo effect. We were able to, I think, very excited, we were able to hire vast majority of the reps have prior nephrology experience because I think they're excited about pove and IgAN as well as the pipeline behind that, and their relationships with nephrologists. I think this one will be really exciting. We aim to have the largest field force and greatest share of voice of the novel disease-modifying therapies in that space.
Okay. Since you teed it up, let's talk a little bit about pove. At this point, we are two-plus months out from the PDUFA date. How would you frame updates on the FDA interactions and confidence into the PDUFA? You clearly sound pretty confident, but I will let you respond.
Yeah. I think that nothing really to disclose, but the renal division has been a really good partner to us, and I think everything remains firmly on track with good visibility for November 30th.
Okay. As far as some of the emergent competitor data, and I guess more clarity on sort of the longer-term eGFR trends, how that impacts positively or negatively your view of differentiation for pove versus some of the earlier movers.
Yeah. I think that all things equal, it would be nice to have all your data all the time, but we feel strongly that there is such a good understanding and acceptance of the correlation of UPCR reduction to eGFR stabilization, right? And in those competitors who have released the data, you have seen that, right?
Yeah.
We feel that we are truly differentiated in our UPCR reduction with that 52% at 36 weeks, whereas some competitors had an extra month of data, right?
Yeah.
We truly think it's best in class in terms of UPCR reduction, best in class hematuria resolution, of Gd-IgA1 reductions, and in getting more patients to KDIGO guidelines of 0.5 grams. Right? We think we have a good story to tell there, as well as not just the greatest reduction, but the shape of those curves, the speed of the reduction, I think really matters. I think UPCR reduction is a proxy for eGFR stabilization, which in and of itself is a proxy for progression to ESRD, right? And death, dialysis, and transplant. So I think we feel very good about that clinical story as well as the safety profile, and then we know that we have a clear advantage in terms of the patient administration characteristics with the only folks with the lowest dose, 0.46 mLs, so it's not painful. It's through an auto-injector, and it's monthly, compared to weekly or much higher dose with a prefilled syringe from the competitors.
Okay. With those points in mind, how much should we read through from the competitor launch data, right? You guys are going to launch later this year. Obviously, there's going to be a period as the product's ramping. In the meanwhile, we're going to have sort of incremental updates from the companies, the earlier movers, on how their launches are going. Why should we not read through from those launches to the overall market size in the interim?
I think that we have been quite gratified, pleased to see the strong uptake so far. It points to the fact that IgAN patients are. There are 130,000+ of them in the U.S. that are biopsy confirmed with their diagnosis. They are typically younger patients, otherwise healthy in their 40s, and have been kind of these ticking time bombs, right, waiting for a therapy. I think that certainly the first mover with Otsuka and VOYXACT will benefit from being first mover. But even with the strong uptake, we are still talking really small numbers
Yeah
out of that total pie here in the U.S. I think that there is still plenty of patients to go after. We will also be going after switchers in this type of market. I think you will potentially see that. Not giving any color on shape of the curve, but we do aim to have winning share over the long term.
Have you guys thought about how you are going to communicate launch metrics in the early quarters and months of the launch? I do not know what you guys have said around communicating or allowing scripts to be visible, or beyond that, how you guys are planning on communicating.
Yeah, I think stay tuned.
Okay
and still working through that.
Okay. As far as povetacicept beyond IgAN, you are moving into a number of other programs, but there has been sort of allusions to potentially expanding beyond the initial four indications. How should we think about that? To the extent that that might be sort of teased out with greater clarity over the course of the balance of the year or into next year.
Yeah. We are currently in the phase III portion. We are phase II/III for primary membranous nephropathy.
Right.
There is no accelerated approval pathway there, so that is 104-week study, but there was a dose-ranging study, we chose the 80 mg dose to move forward with, so that is ongoing. We are also currently not in renal, but in a phase II in myasthenia gravis. That is ongoing as well in pove. Still evaluating the RUBY-4 data in wAIHA. We do still are very excited about the pove pipeline and a product potential here, and are executing on that as quickly as we can and more to come.
Okay. As far as the MG effort, how should we think about that trial design? I guess the rationale for that trial design. Obviously, there was some compelling data out of China. You guys have talked about trying to recapitulate that in a Western population. But this really short-term trial, maybe kind of walk through that and exactly what you guys are trying to show.
Sure. I think a couple things. One is that we do view myasthenia gravis as kind of the poster child for B cell-mediated diseases.
Okay.
That's sort of the causal biology there. Secondly, we found the China-only data very compelling, and that's with a wild-type TACI versus we have this.
Right
This designed, engineered TACI for better tissue distribution, et cetera, so we'd hope to be able to perform as well or better. I think in terms of the duration or the size of the trial, about 30 patients, 12 weeks, we are looking for a meaningful treatment effect, right? It is a dose-ranging study, and that's really what we're looking to get out of it. I think that the opportunity here, again, you could say like IgAN, a crowded space, but with the FcRn, for example, the need for cycling, et cetera, we don't see that with pove, and so we think it could be a much better option for patients.
Okay. We touched in your opening comments on inaxaplin, and maybe we should pivot there. We are going to get AMPLIFY data, as you mentioned, before the end of the year. Should we have lower expectations here relative to what you showed with AMPLITUDE? Clearly, your competitor in the space had, let us just say, noisy data, I think sort of validating your decision to approach these populations separately. That certainly looks like the right decision in retrospect. But should we go into this with maybe a different set of expectations than maybe people went into the original study?
The phase II portion.
The phase II. Thank you.
Yeah.
Yeah.
Yeah. Thank you for saying it that way. I think we would concur that we do feel sort of validated in our decision of a very homogeneous population.
Yeah
for the phase III pivotal study, and focused on those patients with a high protein burn. For the AMPLIFIED study, the population expansion study, I think that it is proof of concept, right? There is no control arm as well. But I think that maybe you could characterize it as a clearer through line, if you will, in the more modest proteinuria patients
Sure
to the AMPLITUDE study. Just less dynamic range, if you will, in which to operate. On the Type 2 diabetes arm, right? Arguably, that's a bit more exploratory. Certain good reasons in the literature to believe in the risk factors here, in terms of why we think it should succeed. But we know definitively we are inhibiting APOL1. What we don't know is how much of the impaired kidney function is from the Type 2 diabetes and the hyperglycemia versus how much is from the APOL1. So that's what we'll learn in this study, but from very clear, distinct populations. The overriding key factor is that you have two APOL1 variants.
Okay. As far as in AMPLITUDE, to what extent do you have good clarity on exactly these sort of where FDA is going to draw the line? What's the regulatory hurdle for that interim analysis? Clearly in IgAN, there were a bunch of earlier movers. We kind of had a better sense on what good looked like
Right
for lack of a better term.
Right.
We don't really have that same sort of precedent here, so how should we think about that?
Yeah. I think to be clear, this study has been ongoing for quite some time.
Yeah.
These patients are not diagnosed and waiting. So we've been enrolling this study for several years and are really pleased with the market development work we've done and the increase in pace there, and are on track to complete full enrollment by the end of this year now. But as a result, it is not a UPCR endpoint. And in fact, it's actually UACR. But the primary endpoint, sorry, for inaxaplin and the phase III interim analysis, it is eGFR slope.
Yep.
How does it separate from placebo? And I think the closest I'll come to really answering your question is that these patients progress in terms of their eGFR decline at almost twice the rate of traditional kidney disease patients. So I think the combination of we saw just 13-week data in the phase II of 47.6% reduction in UPCR, as well as this faster rate of decline. Being able to show that differential in terms of the eGFR slope, even at just 48 weeks, is where our confidence stems from.
Okay. Maybe let's switch gears to the pain franchise. One of the things we commonly remark upon all summer long has been the strength of the JOURNAVX scripts. We monitor plenty of launches, some of which hit plateaus, some which have up weeks, down weeks, et cetera, but the steady growth of JOURNAVX has been one of the more remarkable dynamics we've seen over the past couple months. At this point, what do you think are really the key drivers to really continue to see that growth and really to drive another inflection here, not just this year, but into the next couple of years?
Yeah. I'll try and give a short answer.
Sure
It really is many different factors.
Yeah
All of which we're trying to execute as best we can. So I think first and foremost is the drug works really well, and the physician and patient feedback has been very positive. Secondly is the fact that we have worked very hard on reimbursed access with 260 million covered lives as of the early August, as well as working through some of the machinations, if you will.
Yeah
of going from signing a contract at the parent plan level to getting things to work
Yeah
at the street, at the patient level. We expanded the field force, as I mentioned, some more feet on the street. We have very purposely gone very broad in terms of the prescriber base because we want to build this for the long term. Everything from ER and trauma anesthesiologists to OBGYNs and plastics, dentists, et cetera. Orthopods are a big focus as well, and that's another area where you're starting to see orthopedic surgeons publishing single center series. For instance, a total knee series showing 80%, 90% opioid free. So those sorts of studies are being published and presented now. That helps continue the momentum too.
Yeah.
A lot of marketing initiatives. I mentioned celebrity spokespeople, and things like being on the boards at the Stanley Cup, and I understand you may see us at a professional pickleball tour, et cetera.
Okay.
Those types of things continue. Really a focus on continuing to execute in terms of reimbursed access, the field force, and then focus on prescribers, getting added to formularies, treatment protocols, discharge protocols, et cetera.
Is this going to be the most complicated launch that we see in Vertex's portfolio?
I think it is that. We are very pleased with the script progress.
Yeah.
As you mentioned, we are on track to 3x our scripts in 2026 versus 2025.
Yeah.
Even at 1.6 million, though, that compares to 80 million scripts.
Right
are written. 80 million Americans get a script each year. I think it is very complex and it is very different from the other things we do.
Right
which is one reason for some of the recent management changes, and we recently brought on a new member of our executive committee.
Do you want to talk about that a little bit?
to focus on.
Yeah.
Sure. We're very pleased to have a new EVP in Jasper van Grunsven, who'll be focused on the pain franchise in its entirety, as well as on some of our newer products, and working closely with Duncan McKechnie, who's our Chief Commercial Officer.
How should we think about the chronic pain studies at this point? I think there's been ups and downs in terms of how the Street has viewed or how much value they've ascribed to Vertex. I would argue for the past year, there's been very little credit ascribed to chronic pain. Maybe rightfully so, maybe not. You're going to have some readouts soon. How should we think about that? How should we think about where the bar is for not only provability, but for really to de-risk the products commercially?
Yeah. I think you're right that there is a high degree of Street skepticism.
Sure
around pain, or maybe it's just caution is maybe a better word.
Yeah.
I think that going back about a year ago, as you said, when we said that our hope for moving into peripheral neuropathic or chronic pain with one diabetic peripheral neuropathy and one lumbosacral radiculopathy study would hopefully enable a broad peripheral neuropathic pain label from the agency, the agency declined.
Yep.
We pivoted quickly and began our second DPN study because there is real clarity from a regulatory standpoint, two studies in any peripheral neuropathic pain category, and you'll get that indication. I think DPN is a much better understood type of pain, if you will. There are more centers that have run these types of trials before and well understand how to manage the placebo effect, which really has been the drug works, it's really been managing the placebo effect. Going to a more limited number of sites with significant experience in DPN and in running DPN studies and managing DPN placebo effect is how we decided to execute that. It's two studies. One is about 1,100 patients split one-to-one between suzetrigine, placebo, and pregabalin arm, and the second one is about 700 patients just versus placebo.
Okay. How should we think about those? Obviously, you have your combination efforts behind those two- which I think given some of the M&A in the space has certainly stimulated a lot of attention. Should we think about those efforts in any way being stage-gated by the outcomes of these chronic pain opportunities? Just trying to get a sense on the urgency.
Yeah
with the combination efforts forward.
I think we remain very excited about the opportunity and think that combining a NaV1.7 and a NaV1.8.
Yep
because NaV1.7, the sodium ion channel, that triggers and then NaV1.8 propagates it. Challenging targets to inhibit, which is why we did NaV1.8 first. But if you could do both, we think it could be synergistic in terms of the efficacy benefit. Rather than, I would say, waiting on the DPN results, I would say it is more of potentially waiting for the combo and to see where it might be able to go, both in terms of acute and chronic.
Okay. In the past, you had talked about potentially needing a partner if you were going to go into these larger, potentially more primary care-oriented settings. A lot of that commentary was a couple of years ago now, and as we have talked about already, it is a drastically different company than it was two to three years ago. Are you still viewing it the same way? Has maybe some of that calculus shifted, or would it stimulate a broader rethink in the event of positive data?
I think in the event that we decide to pursue musculoskeletal pain over time,
Yeah
that is clearly a primary care market.
Yep
and would be a candidate for partnership. I think we do feel that we have made some pivots and learned some lessons, but still feel that it can be a specialty commercial model in peripheral neuropathic.
Right
as well as in acute. But I'd say we're always learning and evaluating.
Okay. Maybe we touched on it right at the start, the Crinetics deal added a commercial asset right now in PALSONIFY. And of course, the CAH asset, which I still can't pronounce a little bit, still to come. Maybe on PALSONIFY, maybe help us just think about the market opportunity and how Vertex is best positioned to maximize this commercial opportunity.
Sure, and as Susie mentioned at the outset, one of the reasons we really liked this deal was because of the perfect strategic fit.
Yeah
it is with the Vertex portfolio and with our expertise. Acromegaly is a rare genetic disease. It is a specialty market, so there are about 3,000 endocrinologists in the U.S. who are treating acromegaly, so a very tractable footprint. We bring all of our expertise in rare disease commercialization and also expanding it to OUS countries as well, where we have a track record of commercialization, securing reimbursement, et cetera. We think that we can bring all of that to accelerate the launch and expand it globally.
Okay. When you think about atumelnant now
That is perfect.
It took a lot of practice. You guys, when you announced the deal, you talked about a multi-billion kind of commercial opportunity. I guess the question is on what do we need to see on efficacy as well as on safety to really kind of deliver on that? There has been a lot of talk around liver elevations that were seen in an earlier study. You guys sort of made your case on why maybe that was a little bit overblown or why it is noisy or it is surmountable, but would love to hear kind of an update on how you view that aspect of the profile.
Sure. So what we had said is with the Crinetics acquisition, we see potential for $5 billion in peak sales with PALSONIFY as a potential blockbuster and atumelnant as a multi-billion dollar asset. Obviously we see a lot of value on that side of it. It is in phase III study right now in congenital adrenal hyperplasia, and I know it is a hot topic, timelines
Yep
for enrollment completion data, et cetera. We just closed the transaction, so we are getting our hands around all of that, and we will have updates later, including updated accounting and financial information on our Q3 call. But in terms of what we are looking for, CAH is a disease of impaired cortisol synthesis, which leads to elevated androgens. The goal in treating it is you want to normalize the androgen levels sustainably or durably over time while allowing these patients to taper down their doses of glucocorticoids to physiologic levels, basically, and we think that is a unique proposition that atumelnant can offer, and I will have to see that borne out by the phase III data, of course.
On the safety front, yes, there have been questions about that one incident of liver enzyme elevation, and I say one because I think there were a few, but there was only one that could not be ruled out as possibly related to atumelnant. What we saw there was some elevations of ASTs, ALTs, that was reversible. There was no elevation in bilirubin, so no cases of Hy's law there.
Right.
Once the patient rolled off of study drug, because it happened toward the end of the study, they were fine, no clinical consequences. Everything went back to normal, and those data were shared with the FDA and other regulatory agencies, and they did not ask for any changes to monitoring protocols or anything like that. Based on the phase II data, we are confident in the safety profile and look forward to seeing the phase III.
Okay. I have a little bit of a comment, a little bit of a question. Are we going to continue to have everything ex-CF broken out in some basket of non-CF? Because next year you're going to deliver more growth on an absolute basis ex-CF than in CF. Final question.
Yeah. I would say that as we grow and diversify, as your initial question started, right, we continue to seek ways to make sure that people can understand the story and the key growth drivers. Even going back last year, right, I think it was still footnotes-
Yeah
with the different revenue lines, right? We have progressed there and given that basket of guidance. I think some of it will be just when they kind of hit critical mass, et cetera. So, stay tuned.
Okay.
I don't have a more definitive answer for you, but we'll try and make it easy to understand.
All right. Perfect. Vertex, thank you very much for joining us on stage.
Thank you, Carter .
Thank you. Yep.