Earnings Call: Q4 2018

Mar 12, 2019

Alive. Immediately following the early FDA approval of COPIKTRA, our commercial team was mobilized the same day and began educating physicians, other healthcare professionals and payers on the clinical benefits, safety profile and appropriate use of COPIKTRA and are working to secure access to therapy for patients. Very quickly following approval, COPIKTRA was added to the National Comprehensive Cancer Network, Clinical Practice Guidelines in Oncology for CLL, SLL, FL and also Marginal Zone Lymphoma or MZL not in the FDA approved indication. The NCCN guidelines are the standard physician resource for determining the appropriate course of treatment for patients. And we believe these updated guidelines will help to increase awareness of COPIKTRA and help healthcare providers make informed decisions for patients battling with these difficult to treat advanced cancers. I'm very proud of our whole team in launching COPIKTRA in the U. S. This is no small undertaking and it requires a lot of hard work, experience, persistence and perseverance. The U. S. Is clearly the most important market for us. However, we own worldwide rights for COPIKTRA and we intend to bring COPIKTRA to those patients who could benefit in the major markets of the world. We will mainly do this through collaborating with major pharmaceutical companies in each region. In June 2018, we entered into a license agreement with Yakult Honsa to develop and commercialize COPIKTRA in Japan that carries a total deal value of up to $100,000,000 including a one time upfront payment of 10,000,000 dollars Then in late September 2018 on the heels of the U. S. Approval, we entered into a license agreement with CSPC to develop and commercialize COPIKTRA in China, Hong Kong, Macau and Taiwan that carries a total deal value of up to $175,000,000 including a one time upfront payment of 15,000,000 dollars Both agreements cover the treatment, prevention and or diagnosis of all on the oncology indications in these respective territories and each have a double digit tiered royalty on eventual commercial sales. We are delighted to be working with both Yakult and CSBC and believe these partnerships highlight the global potential of COPIKTRA and we welcome the growing list of strategic partners focused on bringing COPIKTRA to patients worldwide. As we continue to execute the launch of COPIKTRA in the U. S, we'll be working collaboratively with Yakult and CSPC to rapidly advance COPIKTRA through the regulatory processes in Japan and China and ultimately to the patients there who need it. Before I turn the call over to Joe for commercial update, I would just like to take a moment to mention another strategic collaboration that came to fruition in late 2018. Peripheral T cell lymphoma is an aggressive type of non Hodgkin's lymphoma. It's an indication where in the future we are looking to expand the use of duvelisib. In November, duvelisib was selected for Leukemia and Lymphoma Society's therapy acceleration program to advance the development of this novel oral agent for treating the patients with PTCL. The TAP program provides financial and other resources to support the development of therapies for patients with blood cancers. And we plan to use the funds from the TAP program to conduct certain translational and clinical activities relating to development duvelisib for the treatment of PTCL. Portions of this PTCL program we conducted in collaboration with Memorial Sloan Kettering, the Dana Farber, Washington University in St. Louis and Stanford University. With that, I will turn the call over to Joe to provide an update on the commercialization of COPIKTRA. Thank you, Robert. 2018 was a landmark year for Verastem Oncology with the FDA approval and subsequent launch of COPIKTRA in late September. In terms of our commercial performance, as we disclosed in our financial results press release, in 2018 since launch, we achieved 1 point revenues. As Robert mentioned, COPIKTRA was quickly added to the NCCN guidelines following its approval. And as of year end 2018, we have secured reimbursement approval from approximately 75% of major targeted health plans, representing 240,000,000 U. S. Lives. As of yesterday, that number has increased to over 90% of health plans providing reimbursement for COPIKTRA. Even with this success, there's still much more for us to do to bring COPIKTRA to patients who could benefit. As a quick overview of the market opportunity and treatment landscape for COPIKTRA, currently in the U. S, nearly 350,000 patients are living with CLL, SLL or FL. Once diagnosed, majority of patients cycle through several lines of therapy due to the chronic incurable nature of this disease. The treatment path can differ greatly based on the individual profile, including comorbidities, potential intolerance and non response to available therapies such as BTKs and BCL-two inhibitors. When patients cannot tolerate a therapy or their disease stops responding to therapy, options for treating CLL become limited. This is where COPIKTRA and its dual inhibition of PI3K delta and PI3K gamma fits into the CLL and FL treatment landscape for patients who are post 2 prior lines of therapies. We believe COPIKTRA can fill that gap in therapy and provide an chemo free oral monotherapy alternative once chemotherapy or other treatment options have failed to show additional benefit. For FL, it is important to remember that COPIKTRA was approved on accelerated basis. We believe this reflects the unmet medical need for patients with relapsed or refractory FL. We're excited to be initiating our education and marketing campaign this quarter with physicians around the benefits and safety profile of using COPIKTRA to treat appropriate FL patients. A key benefit of COPIKTRA for all potential patients is that as an oral monotherapy that can be taken at home twice daily. This may be especially advantageous for patients with ambulatory limitations or for patients who live a long way from the doctor's office, infusion center or tertiary care hospital. The goal of COPIKTRA treatment is for patients to be able to take advantage of an at home disease management under the guidance of their physician and to assist those patients in maintaining their lifestyle, family life, standard of living and productivity. A large part of our commercial efforts to date have revolved around educating physicians about Verastem Oncology, the need for PI3K as a patient option and the COPIKTRA information. We have been working hard to help physicians overcome some of the negative perceptions that have been created by prior drugs in the class, while being upfront about our safety profile and risk management for the U. S. PI. Overall, the poor perception of previous PI3ks and physicians' lack of clinical experience using COPIKTRA have been headwinds. This lack of experience and misperceptions are something that we believe we can overcome with our educational efforts aimed at physicians and other health care professionals by helping them understand the COPIKTRA data and the patients who could benefit from COPIKTRA as well as the management of patients being treated with COPIKTRA. It's still early days in both the overall launch and in 2019. We're receiving positive feedback from the physicians who are prescribing COPIKTRA, including their support for new treatment alternatives, how PI3Ks is an important mechanism and the importance of new mechanisms of action for patients who are intolerating other classes, have comorbidities or have failed previous regimens. For CLL, SLL and FL, we estimate that patient population in need of a new option is approximately 20,000 patients per year. As we projected, it will take time to educate the medical community and have the physician begin prescribing. The natural evolution of a product launch is rarely linear instead tends to grow as physicians gain experience with the product. We fiercely believe in the importance of COPIKTRA for patients and our whole team is diligently working to educate healthcare professionals and drive adoption of COPIKTRA. Next, I'll provide a quick summary of our ongoing marketing activities. In 2018, from May to mid September, we rapidly built the team and infrastructure needed to deliver on the promise of a novel agent, COPIKTRA. Our dedicated and experienced sales group of 50 sales representatives were in place prior to launch and today they continue to be actively supporting healthcare providers and their patients. We established a distribution network and successfully shipped drug on the day we received COPIKTRA's approval in September. We have an exceptional team with extensive experience in launching new drugs and importantly, in recognizing and understanding the needs that exist for physicians and patients. Our goal is to not only educate them to support physicians and their patients to confidently manage their disease so that patients can focus on living their lives. In summary, we expect the COPIKTRA launch to be a steady build throughout 2019. To date, the U. S. Commercial, medical affairs and access teams have done a great job establishing appropriate payer, patient advocacy, physician, KOL, nurse and physician practice relationships. This of course is the relation to the opportunity and a base to grow from in the months ahead. As we continue further into 2019, we are focused on further increasing the number of doctors using COPIKTRA and continuing to work with the leukemia and lymphoma communities to increase awareness and help ensure patients are able to get the treatment and support they need. With that, I'll turn it over to Dan. Thanks, Joe. Today, we're focused in the near term on the ongoing commercial launch of COPIKTRA in the relapsed refractory setting for patients with CLL, SLL or FL that have had at least 2 prior therapies. But we're also excited about the significant growth potential of COPIKTRA and other hematologic malignancies and potentially solid tumors in the mid and longer term. The composition of matter for COPIKTRA expires in 2,030 before any extensions, so we have time to explore the potential to help patients with other tumors. Our strategy is to first expand the use of COPIKTRA into additional lines of therapy in CLL, SLL and FL, both as a monotherapy and in combinations and then into other lymphoid malignancies such as PTCL, an aggressive type of non Hodgkin's lymphoma. We then see potential for expansion of COPIKTRA to help patients with other aggressive non Hodgkin's lymphomas such as diffuse large B cell lymphoma, Marginal Zone Lymphoma, Cutaneous T Cell Lymphoma, Mantle Cell Lymphoma, Richter's transformation and transformed FL. These are all indications where combinations with novel and standard of care agents could really make a difference. Beyond that, we see potential for COPIKTRA in combination with other immunotherapies in CAR T, both in hematologic malignancies and possibly certain solid tumors. This is our vision for the potential for COPIKTRA. I'd like to update you on where we are today with these development programs, both with our company initiated studies and also with investigator sponsored studies. Last week at the 23rd Annual International Congress on Hematologic Malignancies, 4 abstracts were presented, which continue to support the use of COPIKTRA in CLL, SLL and FL. A key abstract at the meeting highlighted data from the Phase III DUO study evaluating COPIKTRA compared to ofatumumab in patients with relapsed or refractory CLLSLL after at least 2 prior therapies. This is the labeled indication for which COPIKTRA received approval September of 2018. In this analysis, COPIKTRA demonstrated progression free survival of 16.4 months compared to a PFS of 9.1 months for patients treated with ofatumumab. COPIKTRA also demonstrated an overall response rate of 70 percent compared to 39% for patients treated with ofatumumab. The other 3 COPIKTRA posters from the ICHM featured long term efficacy and safety data from patients treated with COPIKTRA. One abstract described a pooled long term efficacy and safety analysis of 4 studies evaluating COPIKTRA in patients with relapsed or refractory CLLSLL that had been on therapy for greater than 2 years. The main finding was that this subset of patients who had received duvelisib monotherapy achieved an overall response rate of 89% with a median PFS of 40 months and observed side effects that were consistent with previously described treatment related events for COPIKTRA. The investigators were able to manage most adverse events through dose reductions and dosing holds allowing these patients to continue treatment. In an abstract on the DUO crossover study, the 90 patients who crossed over to duvelisib once they progressed following treatment with ofatumumab achieved an overall response rate of 77% with a median PFS of 15.2 months. This result was consistent with the strong activity of duvelisib in the parent DUO study and showed that most patients who failed an additional line of therapy continue to benefit duvelisib therapy. Now some other important data presented in 2018. At ASH in December, data were presented from an investigator sponsored Phase 1 trial investigating duvelisib in combination with romidepsin in patients with relapsed refractory T cell lymphoma, including PTCL and cutaneous T cell lymphoma. Of the 27 patients with PTCL, the overall response rate was 59%, including 22% who responded deeply enough to allow them to bridge to potentially curative stem cell transplant. The median PFS for patients with PTCL was 6.72 months. However, this was confounded by the 6 subjects who then proceeded to stem cell transplant. We plan to use funds awarded to us from the LLS TAP program to expand this study and enroll a total of approximately 50 patients. Then in mid-twenty 18, at the European Hematologic Association Annual Meeting, data were presented from an investigator sponsored Phase 1btwo trial and began investigating duvelisib in combination with fludarabine, cyclophosphamide and rituximab, commonly referred to as FCR, as a frontline therapy in younger patients with CLL. The overall response rate in this study was 94% with 52% of the patients achieving a complete response or a complete response with incomplete hematologic recovery. Importantly, the MRD negativity rate in response to treatment was 76% in this study. The 2 year progression free survival and overall survival rates for patients in the study were both 97%. These early data demonstrate duvelisib's potential combinability with chemotherapy and potential use in a frontline setting. The most common adverse reactions occurred in 20% or more patients across these studies were consistent with the COPIKTRA label and included diarrhea or colitis, neutropenia, rash, fatigue, pyrexia, cough, nausea, upper respiratory infection, pneumonia, musculoskeletal pain and anemia. Before I turn the call over to Rob for the financials, I'd like to just mention 2 additional studies that are currently ongoing and worth watching. First is the company sponsored PRIMO study, an open label, multicenter Phase II clinical trial evaluating the efficacy and safety of duvelisib monotherapy in adult patients with histologically confirmed relapsed or refractory PTCL. This is an important study because it potentially allows us to file for accelerated approval for PTCL if the trial is successful. The other ongoing trial is investigator sponsored Phase III study evaluating duvelisib in combination with venetoclax, an oral selective inhibitor of BCL-two in patients with relapsed or refractory CLLSLL. The primary objectives of the Phase 1 portion of this trial are to determine the maximum tolerated dose and the recommended Phase 2 dose of venetoclax for this combination regimen. This is an important proof of concept study to validate the preclinical synergy that we have seen to show that venetoclax and duvelisib can be combined and to potentially broaden the utility of duvelisib into some higher risk patient populations. We're committed to exploring the use of duvelisib in multiple indications and settings. Long term, we see significant potential to create many new and exciting options for patient care based on the mechanism of action of COPIKTRA, which includes effects on PI3K delta and gamma inhibition on both the tumor directly and the tumor microenvironment. Our approach is to follow the science and the unique mechanism of COPIKTRA to support the future development of oral agent as both a monotherapy and in combination with both targeted and immuno oncology agents in a broad range of hematologic and solid tumors hematologic and solid tumors. We believe there are many more opportunities to be unlocked. I'll now turn the call over to Rob for financials. Rob? Thank you, Dan. Since we issued a press release earlier today outlining our Q4 and full year 2018 financial results, I'll just review the highlights beginning with our cash position, then the full year 2018 results. As of December 31, 2018, Verastem Oncology had cash and investments of $249,700,000 compared to $86,700,000 of cash and investments as of December 31, 2017. Net product revenue for the full year 2018 was $1,700,000 compared to 0 product revenue for the full year 2017. As a reminder, we recognize product revenue when product arrives at our specialty distributor or specialty pharmacy network from our 3PL. License revenue for the full year 2018 was $25,000,000 and was related to the license agreements with Yakult and CSPC. Research and development expense for the full year 2018 was $43,600,000 compared to $46,400,000 for the full year 2017. The $2,800,000 decrease was primarily related to a decrease of $6,000,000 in license fees related to a one time milestone payment pursuant to the Infinity license agreement that was recognized in 2017 and a decrease of approximately $3,000,000 in consulting fees, partially offset by increases of $4,000,000 in personnel related costs and approximately $2,000,000 in CRO expense. Selling, general and administrative expense for the full year 2018 was $77,300,000 compared to $21,400,000 for the full year 2017. The increase of $55,900,000 resulted from an increase in personnel related costs of approximately $27,000,000 related to the hiring and staffing of our sales team as well as an increase in consulting and professional fees of $24,000,000 related to the support of the commercial launch. Net loss for the full year 2018 was 72,400,000 or $1.12 per share compared to a net loss of $67,800,000 or $1.76 per share for the full year 2017. Before I turn the call over to Robert for closing remarks, I'd like to highlight one other recent transaction that underscores the value of COPIKTRA. Last week Infinity Pharmaceuticals announced that they had monetized their royalty rights to COPIKTRA to Healthcare Royalty Partners for $30,000,000 upfront and up to an additional $20,000,000 in sales milestones. I'd like to remind everyone that we are obligated to pay Infinity a tiered royalty on sales of COPIKTRA ranging from mid single to high single digits. This was the portion of the royalty that was sold and I highlight this point because it represents a small part of the overall product as a whole. It did not include the additional royalty that the company is obligated to pay to Infinity that is owed to Mundy Pharma and Purdue Pharma. Now I will turn the call back to Robert for closing remarks and to open the call for questions. Thanks, Rob. Looking ahead, 2019 is poised to be an exciting year as we continue to drive awareness and adoption of COPIKTRA and work to expand upon the potential of PI3K inhibition through the investigation of duvelisib as both a monotherapy and in combinations additional hematologic cancers like PTCL. Our focus for the coming year is to execute on our core business priorities with the goal of bringing COPIKTRA to patients who can benefit to increase the company's revenues and to grow shareholder value. Our priorities include: 1, continuing to expand on the commercial traction of COPIKTRA in CLLSLL and FL for appropriate patients 2, initiating a confirmatory Phase 3 study evaluating duvelisib for the treatment of patients with relapsed or refractory FL after at least 2 prior systemic therapies. The confirmatory study is expected to start in 2019. Supporting additional investigational studies of duvelisib both through company and investigator sponsored studies. 4, working with Yakult, CFTC and the LIS to advance the development and expansion of the COPIKTRA brand 5, one more ex U. S. Partnership with Uvelisib and 6, advancing our focal adhesion kinase inhibitor defactinib, which is currently being evaluated in 4 separate clinical collaborations in combination with immunotherapeutic agents. At a twice daily oral monotherapy, we believe that COPIKTRA is an attractive treatment option for both physicians and patients, first in CLL, SLL and FL and potentially in other high unmet need lymphoid malignancies in the future. I recognize the challenges of launching a novel therapeutic where there are challenges from perceptions of the class and limited clinical experience. However, we've come a long way since in licensing COPIKTRA in late 2016. We successfully got COPIKTRA approved by the FDA and it has a long patent life ahead. I'm confident in our strategic and operational plans, the team we have built and our ability to execute on our mission to help bring COPIKTRA to patients in need and to change the way cancer is treated, one patient at a time. With that, we will now open up the call for your questions. Operator? Thank you. Today's question and answer session will be conducted electronically. And our first question comes from Robert Hazlett with BTIG. Your line is open. Hi, this is actually Jake Colby on the line for Bert. Thanks for the question and congrats on the progress. Thanks, Jake. I guess just to start with COPIKTRA on the market for a few months now, has there been any evolution in the sales and education message to physicians to address the PI3K perception headwinds? Yes, it's great. Obviously, we've had I'd say little surprises, but obviously you learn things as you progress. And so I think we're refining messages rather than sort of going down completely different path. But let me let Joe comment more deeply about that. Yes. Jake, thanks for the question. We have been kind of changing as we move along, which is a planned part of the launch. So when we launched, we wanted to come out as that what is COPIKTRA, this dual inhibitor of delta and gamma. So it was really 1st and only, so it was new in the class. So we presented it that way. And we started giving the information around CLL. So what's evolving is more around going away from the dual inhibition to the efficacy and safety of the product and then also the FL, going from CLL to the FL campaign. So we started with CLL. We're now evolving into the FL campaign, which I think is a great spot for us. So the message has evolved over the past couple of months. But all the messages have been resonating very well with physicians. Okay. Thank you. That's helpful. And then I was just wondering if we could get any sort of commentary on on expenses for 2019 and how we should think about their trajectory throughout the year? Absolutely. So Jake, I'll hand you over to Rob to answer that question on expenses for this year. Yes, thanks. And as you know, it's very early on in both the launch and the calendar year. As it relates to guidance, we won't be giving guidance until at least the end of the year. We really need to get a solid idea of the ramp and the overall growth patterns before we commit to specific guidance. I will point to you, however, on the expense side, Based on as noted in our earnings release today, our operating expenses were about $35,000,000 that compares to about $37,000,000 in the 3rd quarter. That should give you a sense of where we are in terms of the back half of last year. But we won't be giving specific guidance on the projected revenue expense numbers till the end of the year. Okay, fair enough. Thanks for the questions. And again, congratulations on the progress. Thanks, Jake. Thank you. And our next question comes from H. C. Wainwright. Your line is open. Thank you. Good afternoon, Robert and team. I have a couple of quick questions. In terms of the education programs that the commercial team is planning so that it can increase the clinicians' experience, can you give us some color as to what sort of programs are you thinking about for that to happen in 2019? Yes. Thanks, RK. I mean, as you know, we were comfortable headwinds that we knew when we brought the drug in was some of the negative perceptions around PI3K. And so we're obviously addressing those head on and really owning the benefits and side effects of the drug. But let me let Joe talk a little bit more detail about that. Sure. Thanks, RK. This kind of builds up on Jake's questions as well. So again, when we launched, we're really looking at kind of coming out as a novel agent, how we're different in the space and to introduce COPIKTRA. As we move forward, we've done more around the efficacy piece for CLL as well as the management of the profile of the product. And now we're moving into the FL piece of it. What we're also doing around the messaging is to really look at what are the patients that physicians are looking to treat. So we just actually came off of our national sales meeting last week, where we had a robust discussion around kind of what are the patients that we're looking to treat. We had 2 KOLs from the field come in to help work with our sales representative to identify to identify those patients. So as we look at it, what physicians are trying to fit in was where does this fit in. And I hear the question actually when we're out with investors as well, where does it actually fit in? And what we're looking to do is this post two prior lines of therapy. So that patient who's now been treated with chemo, ibrutinib, maybe another product like venetoclax. And then there's no option for those patients. Where they're being treated right now is really an open space. There's no treatment in that post two priors. So we're developing those programs around to really identify physicians where we fit in and where our benefit is according to our label. So we'll do the same thing now with FL as we've launched the FL campaign going forward is to really look at what happens post two prior chemotherapies in follicular lymphoma. And it's really an open space because there's no ibrutinib, there's no venetoclax. It's really a PI3K space. So how do we fit ourselves in as a PI3K of choice? And that goes back to how we launched, looking at it as a novel agent, delta gamma, our profile around efficacy, 42% being in double refractory patients, which is different than the other products that are out there. So really our educational programs are established ourselves in CLL post two prior lines, which is an open space and in FL post two prior lines, which is really an open space as well. And it's definitely a PI3K space. We're also working with the medical affairs team to bring more physicians in to having experience with COPIKTRA through clinical programs, through their own ideas as we initiate those, but also through programs that we're looking at through medical affairs to initiate something like a registry study, so to provide them with that experience. So we're hitting them from both ends. Where does it fit in? And there's a clear open need in these post two priors in a given experience. So Joe, with your experience of having launched drugs before, how does in your world, how does this seem comparing it against your previous experience? And are there things that you feel requires a little bit of a tweak? And so there probably are certain things which requires a lot of tweak. So how do you see this and what is some of the anecdotal information that you're getting, especially now that the drug has been out for like close to 5 to 6 months? And then the second part of the question is on the clinical side. So based on some of the things that you have been hearing and based on some of the clinical studies that have been highlighted so far in this call, I would like to know what sort of data expectations we should have and also how you're trying to tie that data with the message on COPIKTRA just as you're trying to do this on this call with the physicians? Okay. There's a lot of great questions in there. I think 2 main ones. So first of all, Joe, can you talk a little bit about your prior experience with other oncology drugs? How does that how do those experiences compare to what you're seeing here? That's the first question. Okay. Yes. RK, I think you're right. And one of the things you said in terms of the we've been out now for about 5 months. And that's really the period of time we've had to introduce both Verastem Oncology and COPIKTRA to the marketplace. So as you recall, the Verastem picked up Duvelisib back at the end of 2016, developed it. Most of the experience with clinical trials was in Europe, not within the U. S. So it's building that base of support right now that the company has picked up. So over the past 5 or 6 months, the team, medical affairs, commercial has done a great job in building that base. And from my experience, that's the important piece of it. Have people kind of touched the product and been able to work with it? We've got some great folks out there who have done that and are supporting us. We need to continue to pull that through. And I think it's a first party started with that 5 or 6 months since launch. So we still have a ways to go, but it's going well and gave me that experience. So, okay, that was I think your first half and the second half was really talk about the clinical studies and maybe more broadly the brand expansion strategy. And I was going to take a couple of quick a couple of quick comments and I'll hand over to Dan. I mean the first thing is we now have an approved drug. We've run the gauntlets of the biology of clinical trials and also through the FDA. We've got long IP as Dan pointed out 2,030 for extension. So we've got 13 or 14 years of exclusivity. We've got dollars thanks to Rob's Sunrise, good capital. We've got a great team. So we have got time to really explore the potential for this drug in earlier lines of therapy and also in different indications both as monotherapy and combination. So maybe with that, let Dan comment a bit more. Sure. I mean, if you look at our growth strategy for COPIKTRA and for those of you who've seen the corporate presentation, we really have our 4 steps where first and foremost, we want to own our indication. We want to own 2 or more lines of therapy in CLL or FL. And I think you saw some of the data that we presented recently that was really data that was taken out of studies that where the top line had already been reported, where we give more information around how well the drug works, how well it works in certain subpopulations and the tolerability of the drug. And that's really job 1. Then when we look at broadening the reach, it's really expanding the use in CLL, SLL and FL. And if you look at the investigator sponsored studies that are going, MAT David's study combining with venetoclax, that's potentially a very important study. As an IST, we don't necessarily control the timing of when that data comes out, but it's moved very rapidly and we would expect to see something hopefully in the near future. The PTCL study that we've talked about PRIMO, again, the data from that first portion of that study is likely to be reported out second half of this year. While we're not releasing any data now, I will tell you it accrued much more quickly than we ever expected, which is usually a good sign that physicians are seeing something they like. And then as we start going in to more aggressive subtypes of non Hodgkin's lymphoma, you'll really see a lot of the investigator sponsored studies we're doing in the more aggressive subtypes DLBCL, MCL, Drichtir's are really supported by some of the combination work that's being done now because once we show we can safely give duvelisib together with a drug like venetoclax, you can look at other areas we can go into. And then we've reported at SITC some of the preclinical data around what I would view kind of a home run for COPIKTRA, which is if we can go into combining with IO, CAR T, potentially crossover solid tumors, we're hoping to get those studies started later this year and really go from there. But it's a combination of mining the data we have from the previous studies, getting readouts from some of the studies that are progressed a little farther and then moving into the others. Thank you. Thank you folks and good luck. Thanks, RK. Thank you. And our next question comes from Matthew Cross with Jones Trading. Your line is open. Hey, guys. Congrats on completing the Q1 of COPIKTRA sales and thanks for taking my questions this afternoon. Starting off, I wanted to ask, you mentioned this increase now up to 90% in reimbursement coverage. And I was wondering if you could kind of give some color around what drove that increase, at least in if was one particular driving force, whether that was some data set, greater discussion of FL given the recent publication and ability to now market beyond package insert? And is there any reason to expect you could achieve 100% coverage or near 100% coverage sometime in the next few quarters as things progress? Great question. I can answer your question very easily. We've got a great team that's working incredibly hard. Joe may have more color than that, but that certainly is a large part of it. I mean they really are very dedicated, very experienced and they're really working it. But Joe, do you want to add anything to that? No, I would totally agree with that, Robert. From the sales team through the market access team, through the medical affairs team that's been backing everybody up, they've done a great job over the past year. And actually, we're in a place, the arcade asked about my experience, we're in a place that usually at this point in time, you're going, I could do a lot better if I just had reimbursement support. So that we have. We've got that reimbursement support. So that's fantastic. But what drove it was really the beginning of last year, we had, I think, our 1st payer meeting back at the beginning of March. I think it might have been the 3rd March we're talking to them. So we've been working very hard with the payers to introduce them to Verastem, introduce COPIKTRA in the data, and we've been pulling that through throughout the year. So it's been a very I think the market access team has done a great job, as Rob was saying. So we've educated them on the product, on the class that it fits in and they're aware of it and we've brought in kind of our medical affairs team with physicians to back it up of why is this an important drug for patients. Now getting to 100%, do I think we'll get there? I think we will, maybe 99% of all the lives. But I think we'll get there. There are a couple of other folks we need to pull in, but I think we'll get there. So again, team has done a great job. Great. No, glad to hear it and hope to see that continue. Next one was on just kind of the cadence of sales over maybe the 1st year, so including this quarter and say the 1st 3 of 2019. Just kind of hoping to get your expectations for what I would expect would be an initially lumpier period during that 1st year as you're improving inventory build, improving distribution efficiency before we kind of make an assessment about the real sales trajectory. Would you expect this to be, say, in this 1st year kind of back end loaded in terms of sales? And is this in any way impacted by the time at which you recognize revenue when that reaches distributors? Thanks, Matt. It's a great question. It's something that we think about a lot obviously. It's we're not giving financial guidance. But I think some of the color that you're asking, I think it's totally fair to talk about. We see this as being a sort of building year and you do start I think you characterize it's more towards the back end. I mean we definitely got some of those headwinds that we knew about that we're overcoming, but it does take time. So maybe, Joe, do you want to give a little bit more color? Maybe Rob, do you want to give some guidance up to that, not official guidance obviously? Yes. So I'd agree, Matt. I think it's a slow build over the year than the 1st year of sales as we want to educate more physicians, get them putting new patients on. And then as we start getting the annuity of patients continuing on to therapy. One of the abstracts that Dan had mentioned, patients were on for 13 months. So that's a great thing for us for the future. So as we get patients on, our goal is to keep them on therapy and build that kind of going forward. So to keep them on therapy and build that kind of going forward. And I think as we deal with some of these headwinds of getting in and talking about how we're a different PI3 ks, how physicians can use this drug and manage it, and then they just start writing for more patients. So I think it will be a build throughout the year. I think you're right, you're looking at the projection is more sales towards the back half of the year. Matt, it's Rob. I'll just add to that. You asked about rev recognition. So the revenue is recognized when the product is received by the specialty pharmacy or the specialty distributor and it's shipped from our 3PL. So that's how that works. And it's typically a turnaround time of 24 hours. Perfect. I appreciate all that detail and very helpful without getting into specific numbers and guidance here. And then just one more before I jump potentially back in the queue here. I was curious, obviously, with so much focus on commercialization right now and that being a crucial driver of the company's growth, wanted to get a sense for, given everything you're doing on the R and D side of things as well, kind of where the focus is? I know there's a lot going on between PTCL, this confirmatory Phase 3 in FL, various combinations, kind of a lot going on beyond obviously the PRIMO study that's very much ongoing. What kind of is the focus that we should be paying attention to most maybe in terms of key catalysts for this year and maybe an initial label expansion? Yes. That's a very important question. I mean job number 1 and Dan said this very, very well. Job number 1 is to make sure we execute on the launch and Joe and the team are on point clearly for that. Job number 2 is to maximize the potential for duvelisib. Again, we have long patent life on this drug. We know mechanistically that this drug has the potential to go into many other tumor types. And so we need to explore those and explore those quickly and efficiently both through company sponsored studies and also through investigator sponsored trials. And we're starting those, we've already started some of those, like the metoclax combination, the PBCL programs, 2 of them that are going on. We see a lot of potential there. And so that's job number 2. Then job number 3 is what else? What other products can we bring forward. Clearly, we have defactinib and defactinib is in those 4 programs and we hope to start to see some data coming out from those trials throughout this year. So the fact that it's going to be potentially an important drug, we don't know yet. The jury is still out on it. And then what else? And I think in due course, there may be what else is too. But Dan, I probably don't know your thunder, but is there anything else you'd like to add to that? No. I'd just like to emphasize the PTCL study and that's likely to be the next label expansion. And I would say if you looked at the Phase I data, it was pretty exciting data. And there's almost a halo effect when we talk to KOLs about the PTCL data and our plans for the future. And they're very excited and we have multiple requests for ISTs, for example, in that area. And so as we look at the more aggressive lymphomas, I think that's going to be a big area of growth for us. That's a good point, Dan, just to emphasize. And we've been very focused up until the approval on getting the drug approved. And we haven't initiated a lot of additional studies. We were again very focused to get the drug approved. Now the drug is approved, it is the opportunity to broaden into additional indications and trials. And it has been extraordinary, the interest that we have received from physicians, KOLs around the country and in fact around the world to try COPIKTRA in different tumor types, different combinations. And you're going to start to see those rolling out as the year goes on. So it's been very heartening and very exciting to see the scientific interest in taking this drug potentially into new indications. Perfect. Thank you all for that commentary as well and looking forward to seeing how things expand on the clinical side and in the back half this year. Thanks, Matt. I'll get back in the queue. Thank you. And our next question comes from George Zavoico with B. Riley FBR. Your line is open. Hi, George. Hi, everyone. Thanks for taking my questions. Nice to see the sales progressing as you described. So I have a question about the European discussions with the EMA. Where do you stand with getting COPIKTRA approved in Europe? Great. Important question. As you know, we own the worldwide rights to the drug. Clearly, the U. S. Is the most important market and we're putting almost all our efforts into the U. S. And we want to commercialize in other regions of the world because there's patients everywhere that could benefit from this drug and we want to make sure we bring COPIKTRA to those patients in an effective manner. So you saw a CSPC in China, you called in Japan. And you just probably expect to see one more collaboration over the next the rest of this year. However, that is not likely to be in Europe. And so we are taking a different approach in Europe and a more sort of open approach to Europe. Maybe let Dan talk about that in more detail. Sure. George, as you can imagine, when we got the priority review in the U. S. And things moved pretty quickly, it kept our regulatory team pretty busy. And so when we got the early approval for COPIKTRA, we really moved a number of those resources over to focus on the EMA and we're actively working now in strengthening our KOL network in Europe. As you know, that's very important to the approval process and then finalizing our regulatory strategy in Europe. We've boosted you were at there was a question earlier about clinical development as well as on the regulatory side. You probably saw the announcement when we brought Bob Morgan on recently. One of the reasons we brought him on was to expand both our capacity on the clinical side, but he also has a great deal of international regulatory experience, which is helpful to us both in the EMA as well as working with our partners in China and Japan. And so that's a big focus of the team right now. And we'll give more guidance on the EMA and timing probably in the latter half of this year. Okay. And then part of the education that you guys need to do obviously with the sort of poor perception of PI3Ks is about handling and recognizing when some of the warnings of the in the black box actually begin to appear as symptoms. So can you describe a little bit about how that's going, whether the rate of dose vacations or dose reductions, have you been tracking that now that COPIKTRA is out on the market? And are you seeing the physicians sort of adapting well, perhaps the more they use it, they adapt better? But any comment on that would be helpful. No, it's a really important question. And we're taking a very different approach to some other companies in the past around PI3K. We are really owning the side effects and embracing them and providing the materials and the education to the physician, the nurse, the physician's office and indirectly to the patient, make sure they know what to expect. Because in general, I mean, these side effects are predictable and manageable. And the side effects that these many of these physicians are very familiar with because they're dosing IO drugs. And guess what, they seem many of the same side effects. So it's much more one of education, much more one of overcoming perceptions than anything else, anything more real than that. But I'll hand it over to Joe or maybe Dan might want to make a comment as well. So Joe, you want to add to what I just said? Yes. It's been an important part of the launch and we'll be going forward as well. So it goes all the way back to the people that we hired in oncology, account managers or sales team that we wanted them to be kind of upfront about the side effects, what to know for a physician to know, what to expect, when to expect it and what to do going forward. And that has been driven a lot of very robust conversations, which has been great. So that's going well. And today, patients are what we're seeing is patients do well in therapy. And again, just as long as physicians know about it, they feel more comfortable about it and how to manage it as well. So it's a big piece of our sales effort. Well, I was just going to comment on what data we have so far on usage in the market. I mean, the nice thing about starting from scratch with all our systems is we've designed our systems, we can actually track that real life usage and delays and dose reductions and things. I would say it's just way too early right now. I mean, the numbers are too small to really draw any conclusions. Okay. I guess, as we go on, we'll learn more about that with every quarter. Okay. And then in terms of just briefly maybe again it's also too early. How many repeat scripts versus new scripts? Can you talk about that or is it way too early for that too? George, it's important data as well. It's too early because it's 3 or 4 months into the launch. We obviously know that many patients are having repeat scripts, but in terms of the numbers, it's probably too early to make anything of the data. Okay. All right. Thank you all very much. And let's hope this keeps growing. Yes, we're with you on that. Thank you. And our next question is a follow-up Matthew Cross with Jones Trading. Your line is open. Hey guys, thanks for taking another one from me here. Just had one kind of as you think about BD opportunities for COPIKTRA beyond geographical deals. I understand you're likely to be opportunistic, but would you say you're committed to commercializing in the U. S. Entirely internally or open to a co commercial or out licensing situation maybe for certain indications where there may be some kind of added synergies from the existing offerings of other players in the space? I mean, it's a very important question. The heart of our business is commercializing in the U. S. We are not open to co commercialization and also splitting up indications is not something that is particularly easy to do or to track. Now we believe in this drug. We have the team and we have the right team. We have the capital. We have a great product. We want to commercialize it in the U. S. We want to own that. And that's how we can build a nice business here. And the second thing is, we're thinking about what we should do in Europe, whether we should be fully commercial in Europe or whether we should partner in Europe. And that's something a decision that we're keeping open. We want to move the regulatory path down the regulatory path a bit more before making that kind of decision. So definitely in the U. S, we're not open to BD conversations. And Robert, I guess I would add, I mean, one of the things we're already starting to hear back from the field is very good feedback on our people and how they interact and how responsive we are as a company and things like that are hard to continue if you try and partner. I mean, it's something that we want to continue to be known for the way we do things. Yes. Thanks, Dan. That's a good point. Fair enough. No, no. And in no way trying to send any negative message about the strong progress Joe and the rest of the team are making here. Just wanted to clarify as far as the strategy and then how we should think about it as we're moving into a more We're delighted to own this drug and we're delighted to have the opportunity to commercialize it in the U. S. Thanks again guys. Thanks, Matt. Thank you. Ladies and gentlemen, this concludes our question and answer portion of today's call. I'd like to turn it back over to Robert now for any additional closing remarks. Thank you. Hi, thank you all very much for joining and for the great questions. In closing, I'd just like to thank everyone again for dialing in today's call. This is a very exciting time for Verastem Oncology and we are now delivering on our mission to improve the lives of patients with cancer. Have a good evening. Ladies and gentlemen, this does conclude the