TG Therapeutics (NASDAQ:) has reported a robust first quarter in 2024, with Briumvi, its anti-CD20 therapy, driving significant revenue growth. The company announced that Briumvi’s US revenue surpassed $50 million, contributing to total revenues of over $63 million. With a focus on becoming the top prescribed therapy in its class, TG Therapeutics is expanding Briumvi’s market reach and developing new formulations.
The company has also entered into a partnership for a CD19 CAR T cell therapy and raised its revenue guidance for the full year to between $270 million and $290 million. Additionally, TG Therapeutics is on track to reach profitability within the next quarter or two and has a strong cash position to fund ongoing operations.
Key Takeaways
- TG Therapeutics reported over $63 million in total revenue for Q1 2024, with Briumvi generating over $50 million in the US.
- The company raised its Q2 net revenue projection for Briumvi to approximately $65 million and full-year guidance to $270 million to $290 million.
- TG Therapeutics aims to solidify Briumvi as the preferred IV therapy for relapsing MS and is working on a subcutaneous version.
- A partnership has been formed to acquire a license for a CD19 CAR T cell therapy.
- The company expects to achieve profitability within the next quarter or two and has sufficient capital, with $209.8 million in cash, to support its operations.
Company Outlook
- TG Therapeutics is targeting the top 50 accounts that cover 70% to 80% of MS patients and expects broad adoption among health providers.
- The company is investing in patient awareness and adding strategic team members to support Briumvi’s market expansion.
- Revenue growth is anticipated to continue, with a goal to eventually reach $550 million, up from a previous target of $450 million.
Bearish Highlights
- No specific details were provided on the revenue split between new patient starts and maintenance patients.
- The company did not discuss exclusive procurement opportunities or provide specific market share data.
Bullish Highlights
- TG Therapeutics has seen quarter-over-quarter growth in revenue and enrollments for Briumvi.
- The company is experiencing a decrease in free drug rates and expects a gross-to-net percentage of around 75% for the year.
- There is strong confidence in the growth trajectory and expansion opportunities.
Misses
- Specific timelines for achieving the increased revenue target of $550 million were not provided.
Q&A Highlights
- The company plans to proceed with subcutaneous Briumvi development, aiming to dose the first patients in the first half of the year.
- TG Therapeutics believes CD19 is a promising target and has a CD19 CAR T therapy, but does not have a CD19 antibody in early development stages.
- No technical hurdles are anticipated for the subcutaneous formulation, which is close to entering clinical trials.
InvestingPro Insights
TG Therapeutics (TGTX) has demonstrated a remarkable start to 2024, with its financial metrics indicating a strong position for sustained growth. Here are some key insights from InvestingPro that provide a deeper understanding of the company’s performance and potential:
InvestingPro Data:
- TG Therapeutics boasts an impressive market capitalization of $2.38 billion, reflecting investor confidence in the company’s strategy and market presence.
- The company’s Price/Earnings (P/E) ratio stands at 56.86, suggesting that investors are willing to pay a premium for its earnings potential, especially given the company’s significant revenue growth of over 3275% in the last twelve months as of Q1 2024.
- A substantial Gross Profit Margin of 93.53% in the same period highlights the company’s efficiency in managing its cost of goods sold and underscores the profitability of its products.
InvestingPro Tips:
- Analysts have taken note of TG Therapeutics’ strong performance, with 4 analysts revising their earnings estimates upwards for the upcoming period. This is a bullish signal that may indicate an even brighter outlook for the company.
- The company’s gross profit margins have been identified as particularly impressive, which is crucial for its ability to fund research and development, expand its product offerings, and maintain competitive pricing.
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Full transcript – TG Therapeutics Inc (TGTX) Q1 2024:
Operator: Greetings, and welcome to the TG Therapeutics Conference Call and Webcast. At this time all participants are in a listen-only mode. A brief question-and-answer session will follow the formal presentation. [Operator Instructions] As a reminder, this conference is being recorded. It is now my pleasure to introduce your host, Jenna Bosco. Thank you, Jenna. You may begin.
Jenna Bosco: Thank you. Welcome, everyone, and thanks for joining us this morning. I’m Jenna Bosco, and with me today to discuss the first quarter 2024 financial results are Michael Weiss, our Chairman and Chief Executive Officer; Adam Waldman, our Chief Commercialization Officer; and Sean Power, our Chief Financial Officer. Following our safe harbor statement, Mike will provide an overview of our recent corporate development, Adam will share an update on our commercialization efforts, and Sean will give an overview of our financial results before turning the call over to the operator to begin the Q&A session. Before we begin, I’d like to remind everyone that we will be making forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements include statements about our anticipated future operating and financial performance, including sales performance, projected regulatory or clinical milestones, revenue guidance, development plans and expectations for our marketed products. TG cautions that these forward-looking statements are subject to risks that may cause our actual results to differ materially from those indicated. Factors that may affect TG Therapeutics operations include various risk factors that can be found in our SEC filings. In addition, any forward-looking statements made on this call represent our views only as of today and should not be relied upon as representing our views as of any later date. We specifically disclaim any obligation to update or revise any forward-looking statements. This conference call is being recorded for audio rebroadcast on TG’s website, www.tgtherapeutics.com, where it will be available for the next 30 days. With that, I’d like to turn the call over to Mike Weiss, our CEO.
Michael Weiss: Great. Thanks, Jenna, and good morning, everyone, and thanks for joining us on today’s call. 2024 is off to an exciting start, and I’m incredibly proud of the accomplishments already achieved this year. Company-wide, it feels like we are firing on all cylinders. A prime example was the recent announcement of the award of the VA contract for Briumvi as the preferred anti-CD20 for the VA system. We cannot be more excited to be able to support our veterans with multiple sclerosis by offering Briumvi at a deep discount. We see this as a great way to serve our veterans, introduce Briumvi to additional health care providers, many of whom split their time between the VA and their academic appointments and, of course, generate incremental revenue. As for the first quarter, the demand for Briumvi was extremely strong, and I’m pleased to report that the U.S. Briumvi revenue was in excess of $50 million, and total revenues for the quarter were over $63 million, which includes milestone payments received from our ex-U.S. partner. By any measure, it was a robust revenue quarter for TG. As mentioned previously, starting in late 2023 and continuing, we have significantly increased our investment in patient awareness activities and strategically increased the size of our commercial team. I have to believe these investments contributed to the strong first quarter results. More broadly, our team continues to be focused on our long-term goal of becoming the number one prescribed anti-CD20 from a dynamic market share perspective. And the feedback from physicians, patients, nurses and infusion centers continues to drive our confidence that is achievable. We believe that Briumvi has best-in-class profile that should help us get there. Briumvi is the only anti-CD20 monoclonal antibody that can be given as a 1-hour infusion every six months following the starting dose and is the only anti-CD20 monoclonal antibody in Phase III trial to achieve an annualized relapse rate of less than 0.10. Also in Phase III trials, the Briumvi in 1-hour infusion was generally well tolerated with 95% of the 1-hour infusions being delivered on time. Beyond the clinical data, Briumvi is also differentiated by design, having been glycoengineered for enhanced immune effector cell engagement and efficient B-cell depletion. As previously presented, preclinical data demonstrates that compared to the other anti-CD20s approved or used to treat MS, Briumvi has the highest binding affinity to CD20, the target found on the B cells and through its glycoengineering has the ability to induce the highest level of antibody-dependent cellular cytotoxicity. We look forward to evaluating these preclinical differences further to assess what, if any, contribution than they have to Briumvi’s differentiated clinical profile, and we will seek to show these data when available. We’re also excited to share during the quarter that there were three newly issued patents from U.S. Patent and Trademark Office extending patent protection for Briumvi through 2042. With the extended runway, our development team is focused on potential expansion opportunities for Briumvi, both within MS as well as in other autoimmune diseases. To that end, we are focused on three Briumvi-related initiatives this year, which we believe could drive significant future value. First is further improving the convenient dosing of IV Briumvi. In March, at the ACTRIMS conference, we presented updated data from the ENHANCE trial, evaluating the safety and efficacy of eliminating the 4-hour Briumvi 150 milligram starting dose for patients who switch from a prior anti-CD20. Data presented suggests that Briumvi was well tolerated for patients that skipped the starting dose and went straight to the first full 450-milligram dose given as a 1-hour infusion. These early results are encouraging, and we look forward to continuing to present additional efficacy, safety and tolerability data from this study throughout the year. Second is the development of subcutaneous Briumvi. We believe the subcu CD20 market is distinct from the IV market and believe this could represent a significant additional opportunity for Briumvi. We are preparing to enter human bioequivalence studies this year and look forward to providing additional updates on this front as we have them throughout the year. And third, we look forward to evaluating Briumvi in other autoimmune indications. The goal is to launch our first autoimmune trial evaluating Briumvi outside of multiple sclerosis later this year. We believe the expansion of Briumvi represents a significant opportunity, and we look forward to providing updates throughout the year, but we are not stopping there. The future of TG also lies in the expansion of our portfolio. We recently entered into a partnership with Precision BioSciences (NASDAQ:) to acquire a worldwide license to Precision’s azer-cel, an allogeneic CD19 CAR T cell therapy for autoimmune diseases and all other non-oncology indications. We believe azer-cel has the potential to be a first-in-class, best-in-class treatment for certain autoimmune diseases, and we look forward to commencing a clinical trial this year. I also want to congratulate our partners at Neuraxpharm on their launch of Briumvi in Europe, which also occurred in the first quarter, with the first commercial sale in Germany. Transitioning the program to enable their timely launch took significant effort from our team, and I’m proud of how everyone worked so closely together to make it happen. The Neuraxpharm team is experienced, motivated and focused, and we look forward to hearing more from them as the launch progresses to multiple countries across Europe and then around the globe. Finally, I want to thank and acknowledge the entire TG team. It’s amazing to see the focused attention and care that TG-ers take to ensure the best possible experience for patients with MS. While we spent a lot of time on these calls talking about numbers, the most gratifying part of my day is hearing firsthand from patients taking Briumvi and the positive experiences as well as HCP’s anecdotes about their patient’s treatment successes with Briumvi. With that, let me hand the call over to Adam Waldman, our Chief Commercialization Officer, to provide a detailed update on the Briumvi U.S. commercial launch. Adam, go ahead.
Adam Waldman: Thank you, Mike, and good morning, everybody. I’m excited to provide insights into our continued commercial progress in the first quarter. This was another very strong quarter of performance, exceeding our revenue guidance in all of our key performance metrics. Our focus on delivering Briumvi to patients remains unwavering, and I’m pleased to share our progress with you today. In the first quarter of 2024, we continue to see strong uptake of Briumvi in the market. As reported in our press release, first quarter net sales in the U.S. for Briumvi were $50.5 million, representing 25% growth quarter-over-quarter. The first quarter number exceeded our original guidance of $41 million to $46 million provided in early January as well as our updated guidance we provided in late February. The trends we saw early in the quarter continued throughout the quarter, reflecting strong and growing demand for Briumvi. This growth is particularly impressive given the first quarter challenges associated with beginning of the year payer dynamics. In fact, we were the only CD20 in MS to see revenue growth quarter-over-quarter in the U.S. market during this timeframe. Equally impressive is that we also saw enrollments grow by approximately 25%, with over 1,250 new patient scripts received by the TG hub in the quarter. I want to congratulate our team on doing an exceptional job preparing for the inherent insurance-related challenges seen in the first quarter and mitigating the potential impact. Since launch, we’ve implemented a comprehensive commercial strategy that encompasses targeted educational initiatives; engaging health care providers, both virtually and in-person; and leveraging digital marketing channels to reach a broader patient audience. Our efforts have resulted in increasing uptake of Briumvi, with health care providers recognizing the value that Briumvi brings to patients. Concurrently, ensuring patient access to Briumvi remains a top priority for us. We continue to receive exceptional feedback on the comprehensive patient support programs we have introduced to assist patients in navigating reimbursement challenges and accessing the treatment they need. We also continue to make significant strides in expanding our market presence. Through targeted marketing initiatives and effective sales force deployment, we successfully penetrated new accounts and prescribers, driving sustained growth. We saw both increasing number of repeat prescribers and impressive gains in new prescribers, with approximately 160 new prescribers in the first quarter, the majority of which were from academic centers. We also continued to convert new centers, adding 65 new accounts in the quarter. To date, we have seen broad adoption of Briumvi by across the U.S. with new prescriptions coming from over 450 centers and over 800 unique prescribers. Encouragingly, we also continue to see a diverse mix of patient types, including those that are naive to all treatments and those that were previously treated and switched from both non-CD20 and CD20 agents. This mix of patient types continue to be fairly consistent quarter-to-quarter, with the largest group consisting of patients that were previously treated, but naive to anti-CD20 therapy. 2024 is off to a really strong start. We achieved record Briumvi new patient enrollments into our hub in the first quarter and far exceeded our first quarter revenue guidance and continued to show strong quarter-to-quarter growth, despite the first quarter insurance headwinds. We continue to see momentum building into the second quarter. And based on the information we have available at this time, we are targeting Briumvi net revenue of approximately $65 million for the second quarter. In terms of the full-year, we continue to feel confident about the Briumvi trajectory. Based on current trends, we believe we are tracking above the top end of our original guidance of $220 million to $260 million and are therefore raising our full year guidance to $270 million to $290 million. Looking ahead, we see promising opportunities for further growth and expansion. We believe we are poised to broaden our reach and make an even greater impact on the MS patient community. We continue to believe Briumvi’s profile remains very compelling and will eventually be the IV therapy of choice in the relapsing MS market. In conclusion, I want to thank our team for their dedication and hard work. They have executed the launch plan with precision, driving awareness and adoption among our targeted health care providers, and we believe their outstanding efforts are contributing to the positive experience with Briumvi and confidence in our organization. I also want to thank the health care providers and their patients for their trust in TG Therapeutics. Together, we will continue to improve outcomes for those in need, and we certainly have more work to do, but we are focused and extremely motivated to continue to work every day to bring Briumvi to those people living with MS and their families. With that, I’ll turn the call over to Sean Power, our CFO. Sean?
Sean Power: Thank you, Adam, and thanks, everyone, for joining us. Earlier this morning, we reported our detailed first quarter 2024 financial results, which can be viewed on the Investors & Media section of our website. This morning, I’ll start with a discussion of our revenue. We are pleased to report total revenue of approximately $63.5 million during the first quarter of 2024, which, as previously mentioned, includes $50.5 million of U.S. Briumvi net product revenue. Also included in our Q1 2024 revenue total is approximately $13 million of license milestones, royalty and other revenue, which consists primarily of the $12.5 million milestone we received from our ex-U.S. partner for the first commercial launch of Briumvi in the EU. Our OpEx during the first quarter of 2024, despite some onetime charges, has remained well controlled and in line with previously discussed ranges. For the first quarter of 2024, our operating expenses were approximately $58 million, which includes onetime charges to research and development expenses of approximately $8.8 million related to our agreement with Precision BioSciences for the in-licensed azer-cel program. During the first quarter of 2024, we also saw a modest increase in R&D expenses, driven by manufacturing and development costs associated with our ublituximab subcutaneous development work. On the back of the reported revenues and well-controlled OpEx, during the first quarter of 2024, we reported a modest net loss of approximately $10.7 million or $0.07 per share compared to a net loss of approximately $39.2 million or $0.28 per share during the comparable quarter in 2023. From a cash standpoint, we ended the first quarter with $209.8 million in cash, cash equivalents and investment securities, down less than $10 million from Q4 of 2023. We believe our current cash position, coupled with our previously guided revenue and expense guidance, provides us with sufficient capital to fund our operations to cash flow positivity. With that, I will now turn the call over to the conference operator to begin the Q&A.
Operator: Thank you. We will now be conducting a question-and-answer session [Operator Instructions]. Our first question comes from the line of Michael DiFiore with Evercore. Please proceed with your question.
Michael DiFiore: Hi. Good morning guys. Thanks for taking my question. And congrats on all the great projects this quarter. A couple for me. Regarding sales in EU, I know it’s very early, but when could we expect Neuraxpharm to begin offering details? And I have two follow-ups? Thank you.
Michael Weiss: Yes. So in terms of Neuraxpharm providing public details, I think we’re a long way off. They are a private company, private equity backed, so I don’t anticipate they’ll be providing any public guidance or information to my knowledge. Adam, anything different from your side?
Adam Waldman: No, no. Nothing to add there.
Michael DiFiore: Okay, okay. Fair enough. And my other two questions are, how much of Briumvi’s fiscal year 2024 guidance raise was due to the recently announced VA contract? And any color that you could provide on pricing or increased rebating in this segment? I know you said it’s heavily discounted.
Michael Weiss: Yes. Adam, go ahead.
Adam Waldman: Sure. Yes, the revenue raise was really – the VA was not really factored in for a couple of reasons. One, this won’t go into effect until June. Second, it will be a gradual sort of increase as new patients get on. Patients will only really have the opportunity in this year to have the first two infusions at best. So it will be a gradual increase, and it wasn’t really a factor in the way that we looked at raising our guidance. The guidance was raised based on the demand trends that we’re seeing. As far as pricing, I think that’s out there and public. We offered about a 72% discount, roughly about $2,900 a vial.
Michael DiFiore: Okay. Great. And my last question is this. In the most recent cut of the enhanced data presented at ACTRIMS, three patients in Cohort 2 had to have their infusion slowed down or interrupted. Any color on these patients? How long would these infusions slowed down to or interrupted for? And were there any unique clinical features of these patients that could explain this?
Michael Weiss: So no, I don’t think there was anything particular about the patients, but the infusions were pretty modest. And I think all we’ve done reasonably close to the 1-hour anyway. So no, I think it was just basic stuff that is typical of infusions. But I don’t think there’s anything to be worried about there. It was well tolerated overall, and those patients did well.
Michael DiFiore: Got it. Thanks so much. Congrats, again.
Operator: Our next question comes from the line of Ed White with H.C. Wainwright. Please proceed with your question.
Edward White: Good morning. Congratulations on the results. Thanks for taking my questions. So the – just to clarify what you just said on the VA contract, Adam. Was it a 72% discount?
Adam Waldman: Yes.
Edward White: Okay. Thank you. And this has been brought up before, but I just wanted to address it again. Thinking about the potential opportunity in the so-called crap-gap with OCREVUS. Is this something that you think you’ll be able to produce data on or somehow address this with your sales force?
Michael Weiss: Yes. So in terms of crap gap and being able to show, I mean, we’re trying to capture as much data as we can through the ENHANCE study. I think the number is about 50 to 60-ish percent. Maybe two-thirds report crap-gap as they’re coming into the ENHANCE trial. So we’ll try to capture some of that information on the back end. Hopefully, we’ll have at least some anecdotal information about patients reported, whether they’re or not seeing the crap-gap. It’s hard – there’s no scale to objectively measure crap-gap. There’s no – so it is a challenging thing to measure, but we’ll do the best we can within the ENHANCE study. And whatever studies that we conduct, we will certainly try to parse out the effect and whether we’ve changed that for patients.
Edward White: Okay. Thanks, Mike. And just – when thinking about other potential indications, how do you prioritize outside of MS? I’m sure you have plenty of factors in there, but where does time to potential approval come in or size of the potential market? How are you sort of ranking that?
Michael Weiss: Yes. I mean, I think, look, we’re probably focused on things like RA and lupus for Briumvi outside of MS sort of larger indications. And as we’ve said previously, in some more niche indications, we would be looking at azer-cel.
Edward White: Okay, Mike. Thanks for taking my questions.
Michael Weiss: Thanks, Ed.
Operator: Our next question comes from the line of Roger Song with Jefferies. Please proceed with your question.
Roger Song: Great. And my congrats to the 1Q results. And then so just a couple of questions from us. One is understanding your hub is capturing most of the new patients and given you have quite a few quarters since launch, so how would you characterize the repeat infusion rate you have been seeing?
Michael Weiss: Yes. Adam, do you want to go ahead on that one?
Adam Waldman: Yes. So yes, just to reconfirm here, the patient hub numbers that we’re giving you are new patients only. So just to – I think that was your question there. And then as far as persistence, we would say we’re still early in the – with our data, and we continue – but however, the data that we see, we continue to see that the 24-week persistence is in line or maybe slightly better than our expectations of about 85%, week 24. So we feel pretty good about it. Although the data is early, we’ll continue to look at it. But right now, it’s in line or maybe slightly ahead of what we expected.
Roger Song: Excellent. 85% is good. And then so you are having now 800 health provider and around 450 centers. So understanding where you start to – when you plan to launch, you are targeting top 50 accounts covering 70% to 80% with MS patients. Just curious, is that still the goal for the provider or the center outreach? And then if that’s still the case, then when do you expect you will achieve that $550 million from $450 million?
Adam Waldman: Yes, yes. So I think if I understand the question, it’s what’s our goal in terms of new accounts and new prescribers. I’ll just say that I think we’ve done really good. We’ve got broad adoption right now, but we certainly see opportunity for more adoption with even more prescribers and, of course, deepening the use with our current prescribers. The good news in the quarter as we saw increases in both repeat prescribers and adding new prescribers at a pretty good clip and new accounts at a pretty good clip. So we feel good about it. We’re continuing to make progress every day and certainly have opportunity, but feel good about where we’re at right now.
Roger Song: Great. Thank you. One last question related to the financials. So I think earlier this year, you’re guiding the OpEx as $250 million for the year. Just want to confirm, is that still the guidance for now? And then also curious about the [indiscernible] for the coming years given you continue to launch and expanding your pipeline? Thank you.
Michael Weiss: Yes. I’ll take a first crack. And Sean, jump in. But yes, I mean, I think we’re well on track to – we said approximately $250 million in OpEx. It gives us a little wiggle room there. But if you look at even the first quarter, we had $58 million and change, and we had $8 million and change, which was the onetime to Precision. So the base OpEx is still only around $50 million for the quarter. So you multiply that times four, you’re still well under the $250. That gives us room to grow, and we are growing. Like I said in my prepared remarks, we’re strategically adding to our team, and we’re continuing to spend money on patient awareness programs. But I think, from where we sit today, we’re in pretty good shape. Sean, any more details there?
Sean Power: No. I think you’ve covered it pretty well, Mike.
Roger Song: Great. Thank you.
Operator: Our next question comes from the line of Matt Kaplan with Ladenburg Thalmann. Please proceed with your question.
Matthew Kaplan: Hey, good morning, guys. Congrats on the quarter. So maybe for Adam. In terms of new patient starts, can you give us a little bit more detail in terms of where they’re coming from in terms of naive, switch and the background that you’re getting these new patients from?
Adam Waldman: Yes. Thanks, Matt. Good morning. So I would say we have not given out specific percentages of the patient and how it exactly breaks out. What we said is the biggest group is patients switching from non-CD20s, but we also have good representation from treatment-naive patients as well as patients that are switching from CD20s, like OCREVUS or KESIMPTA. So we’re getting – encouragingly, we think we’re getting a nice diverse group of patients and, importantly, staying consistent quarter-to-quarter. There’s no – there wasn’t any sort of big boluses of a certain patient group that sort of diffused over time. So we’re seeing consistently representation from all three of those groups.
Matthew Kaplan: Okay. That’s helpful. Thanks. And then, I guess, in terms of the subcutaneous opportunity for the Briumvi formulation. I guess, recently on the Roche call, they said they see the subcutaneous opportunity as more than $2 billion. I guess, question is with your potential differentiated profile, what’s your assessment of the subcu opportunity?
Michael Weiss: Yes. I’ll speak broadly, and I’ll let Adam chime in. I mean, look, the folks at Novartis (SIX:) have done a really nice job of carving out a subcu market. They’ve created it. And I think, as Roche probably mentioned, Novartis is probably over $2 billion and growing today. So there’s a nice market there. And yes, I mean, our goal is to come into that market with a very competitive profile product. As we’ve said previously, we understand the parameters. We’ve got, on the one hand, a relatively elegant auto-injector once a month, and we’ve got a relatively bulky product every six months. Somewhere in the middle, we think it is an optimal product design, and we’re going to try to get there. So I think from just where we sit today, we’re seeing opportunity, and we’re going to take our best crack at it. Adam?
Adam Waldman: Nothing else to really add there, Mike.
Michael Weiss: All right. Sorry about that.
Matthew Kaplan: All right. Thanks for taking the question guys.
Michael Weiss: Thank you.
Operator: Our next question comes from the line of Mayank Mamtani with B. Riley Securities. Please proceed with your question.
Mayank Mamtani: Good morning, team. Congrats on a strong quarter. And thanks for taking our questions. Sorry, Adam, if I missed this. Did you say the revenue split up between new patient starts and maintenance patients? And I was also curious to hear from you how you think that stacking up effect in second half, how we should expect that revenue split to be. And if you can also comment on some other metrics you’ve provided before, free drug percentage, gross to net. Anything on that would be helpful as we think about the full year modeling. And then I have a couple of follow-ups?
Adam Waldman: Yes. We didn’t share – you didn’t miss it. We didn’t share any specifics on new versus continuing patients from a revenue perspective. We do continue to feel that this is a market where duration is a big driver of revenue, and there will be a pancaking effect that will – as time goes on, patients will – this is a very sticky – the duration is really good. Patients are on drug an average of five years. So you will see that pancaking effect over time. So that’s the best that I have for that question. I think your other question was free drug. As I said before, we did expect free drug rates to come down. We are seeing free drug rates come down. I think in the first quarter, we’re about 12% is our – right now, I think it was about 12%. From earlier in 2023, we’re about 20%. So 12% in the quarter. And then from a gross to net standpoint, I think what we said previously is our gross to net is approximately 75%, will go up and down from quarter-to-quarter. But 75% is probably a good number to use for the remainder of 2024.
Mayank Mamtani: Thank you. That’s helpful. And then in your updated guidance for full-year, I was just curious to learn how are you thinking about that year-end exit market share. Again, like I don’t know if you think of the market as total NRx percentage, which, Mike, I think you provided. You’re tracking at that 10%. But obviously curious to hear how you think about that market share in terms of either total RMS patients or within the anti-CD20 drug class patient. Could you just give us some color on how – what that $280 million midpoint assumes in terms of market share?
Adam Waldman: Yes. Mayank, I’m probably not going to get into any specifics. I mean, our goal here is to increase the depth of the use and the breadth of the use and continue to add new prescribers. We see continued opportunity for growth. We feel very confident in the trajectory. We feel very confident in the demand trends that we’re seeing. And we’re going to continue to focus on growing the usage of Briumvi across the market, and we’re doing a great job of it. And based on our guidance here, we feel – obviously, we feel very confident and continued growth going forward.
Mayank Mamtani: Okay. Go ahead.
Michael Weiss: Yes. I’m just going to chime in on the first question you asked about the revenue split, new versus old. I know we’re not providing actual numbers, but I think it’s worth just to mention that in the early years, we’re going to be driven by the new starts. In the later years, we will be driven by the ongoing or stacking patients. So if you look at probably our competitive IV CD20s has been on the market for a long time, the vast majority of their sales are going to be based on continuing patients, not on new patients in any particular quarter, where as I’d say, we’re probably the opposite still, right? We’re still reliant on our new starts. But over time, the continuing patients sort of take the commanding role in how the revenue stack up.
Mayank Mamtani: Yes. And that bodes well for that size of that pancake downstream. Yes. I guess, last question on the subcu target product profile, Mike. Just would be helpful to understand how you and even some of the KOL feedback, now that we know what the subcu profile for OCREVUS would look like at launch, now that all the data is out there, was just curious, Mike, as you design the human bioequivalent study, what differentiating attributes are in mind as we think about that product profile? And thanks again for taking my question.
Michael Weiss: Yes. So look, the OCREVUS subcu is not a true patient administered at home product today. So that is yet to be created – or not created, but to be available or even studied as far as my knowledge. So that’s still yet to come. I mean, our goal is to have something that is a patient-administered, patient-friendly product, again, more along the lines of what was done with ofatumumab. So I don’t know how much markets they are in. We think there’s a lot of room to thread the needle here and come up with a product profile that accomplishes the goals of being both convenient and easy to use.
Mayank Mamtani: Got it. Look forward to [indiscernible] update. Thanks, Mike.
Michael Weiss: Thank you.
Operator: Our next question comes from the line of Prakhar Agrawal with Cantor Fitzgerald. Please proceed with your question.
Prakhar Agrawal: Hi. Good morning and thanks for taking my question. And congrats on the quarter. So just following up on the subcu Briumvi question. I’m trying to understand, like what’s your base case assumption on where the dosing frequency could land for subcu Briumvi? I guess, the reason I’m asking is if it ends up being once a month, would you still go ahead with the subcu development? And I have one more.
Michael Weiss: Yes. I mean, I think the bottom line is we probably would, but I don’t think that’s going to be necessary. So I don’t know that, that’s a scenario that is likely. But yes, I mean, it’s early to tell. And again, I think if we feel like we’ve got something that has a good opportunity to make a dent in the market, we’ll go forward. And certainly, once a month could be – could have some impact in the market. Obviously, it probably has less impact than something that has a less duration, and we’ll do the math on that in that concentration and less frequency. But I’m not so concerned that, that’s an issue here.
Prakhar Agrawal: And when do you expect patients to be dosed for subcu Briumvi?
Michael Weiss: We would hope to have first patients dosed within the first half of this year. So hopefully, in the next few months here.
Prakhar Agrawal: Got it. And lastly from my side, we’re seeing a lot of data on CD19 antibodies and other autoimmune indications. What’s your view on CD19 versus CD20? And obviously, there is a theory that targeting CD19 could achieve broader coverage of the B-cell compartment compared to, let’s say, a CD20. So just wanted to get your perspective there. And do you have a CD19 in early-stage pipeline?
Michael Weiss: So yes, I mean, we do have a CD19. It’s our azer-cel CAR T therapy. It is a CD19. So we think CD19 is a great target. We think it’s hard to know if the broader coverage is a positive in all settings. There are some diseases that are characterized by plasma cells that may be impacted by CD19 or maybe expressed in CD19 or that may be helpful. NMO is one that folks talk about quite frequently as more potentially CD19 driven. So we think there are areas where CD19 may be helpful. But overall, we think the overall opportunity in CD20 and CD19 is going to be hard to distinguish in most diseases. And the CD19, when they hit – hits pre-B-cell in addition to B cells, CD21 hits matured B cells. So in terms of recovery, you may see a difference there. So I think there’s a lot of things to balance when you think about CD19 versus CD20. But from an activity standpoint, in most diseases, I don’t know if you’re going to see a material difference.
Prakhar Agrawal: Yes. I guess, my one clarification. I was asking about the CD19 antibody, not the CAR T. Do you have a CD19 antibody in early stage, even preclinical?
Michael Weiss: We don’t, we don’t. I don’t find that to be a product of interest to us at this time.
Prakhar Agrawal: Thank you.
Operator: Our next question comes from the line of Eric Joseph with JPMorgan. Please proceed with your question.
Noah Eisenberg: Hi. Good morning, guys. This is Noah on for Eric. Thanks for taking our question. We were just wondering if there were other exclusive procurement opportunities similar to the contract that you just secured with the VA?
Michael Weiss: Adam?
Adam Waldman: Not sure I understand the question. Could you clarify?
Noah Eisenberg: Yes. We’re just wondering if there are other opportunities for [indiscernible] exclusive access contracts with other providers going forward?
Adam Waldman: Okay. Got you. Okay. Understood. I don’t have any updates at this time on that question.
Noah Eisenberg: Got it. Thank you.
Operator: And our next question comes from the line of Corinne Jenkins with Goldman Sachs. Please proceed with your question.
Corinne Jenkins: Good morning. So maybe a couple of questions from us. One, you’ve stated that you guys are probably close to reaching profitability in the next quarter or two given the revenue guidance versus the OpEx guidance. How are you thinking through profitability versus kind of like it’s ramping or extending your R&D or SG&A spend to support the [launch] and future development? And then from a technical perspective on the subcutaneous formulation areas, what else is left to do before you’re able to enter the clinic?
Michael Weiss: Sure. So thinking about profitability, the – I don’t think those questions you asked are mutually exclusive or points, right? So we have – we will continue to invest in the Briumvi launch. We’ve noted that we have an increased budget in OpEx to approximately $250 million for the year. So I think there’s some room there to even grow. From a product standpoint, similarly, we are interested and continue to build among the Briumvi opportunity, the azer-cel opportunity. And we’ve said that we’ll continue to look for additional external opportunities. So I don’t know that we’re fixated on the exact profitability numbers. I know that it may – as EPS becomes something of interest. But I don’t think the future is exclusive. And I do think we plan to continue to grow our Briumvi efforts and our team and continue with our R&D platform. But as an overall company, our – I think, our cost structure versus most other companies, not all, but most, is pretty modest, and we’ve kept a pretty lean ship. So I think the consequence of that is we’ll be at profitability probably sooner than most companies would, given the circumstances. In terms of the subcu technical aspects before entering the clinic, I think we’re pretty much over most of the technical hurdles. I think we’ll be able to get into the clinic, I believe, in the next two months or so. And I think there’s a continuing effort to make continued improvements in what we’re working on, which will all just be filtering into the clinical program. But I don’t think there’s any technical hurdles right now. Just getting – get and going.
Corinne Jenkins: Thank you.
Michael Weiss: Thank you.
Operator: Thank you. We have reached the end of our question-and-answer session. And with that, I would like to turn the floor back over to Mike Weiss for any closing comments.
Michael Weiss: Great. Thank you, everybody. Well, okay, so I just want to thank everyone for joining us today. Hopefully, everyone has been able to see the excitement and enthusiasm that we have here at TG and what’s going on with the company. We were – the first quarter was quite good, in our opinion. We think everything went extremely well. And we look forward to continuing to push forward and achieve even more as we move forward into the remainder of the year. Again, we thank everyone for their support. Most importantly, we want to thank the clinicians and patients who definitely put their trust into TG. The whole team does appreciate it. With that, I’d like to thank everyone for joining us, and have a great day.
Operator: This concludes today’s teleconference. You may disconnect your lines at this time. Thank you for your participation.
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