Yahoo Finance Amicus Therapeutics, Inc. (NASDAQ:FOLD) Q1 2024 Earnings Call Transcript
Amicus Therapeutics, Inc. (NASDAQ:FOLD) Q1 2024 Earnings Call Transcript May 9, 2024
Amicus Therapeutics, Inc. misses on earnings expectations. Reported EPS is $-0.15985 EPS, expectations were $-0.06. Amicus Therapeutics, Inc. isn’t one of the 30 most popular stocks among hedge funds at the end of the third quarter (see the details here).
Operator: Good morning ladies and gentlemen and welcome to the Amicus Therapeutics' First Quarter 2024 Financial Results Conference Call and Webcast. At this time, all participants are in a listen-only mode. Later, we will conduct a question-and-answer session and instructions will follow at that. As a reminder, this conference call is being recorded. I would now like to turn the conference over to your host Mr. Andrew Faughnan, Vice President of Investor Relations. You may begin.
Andrew Faughnan: Thank you, Jill. Good morning. Thank you for everyone. Thank you for joining our conference call to discuss Amicus Therapeutics' first quarter 2024 financial results and corporate highlights. Leading today's call we have Bradley Campbell, President and Chief Executive Officer; Sebastien Martel, Chief Business Officer; Simon Harford, Chief Financial Officer; and Dr. Jeff Castelli, Chief Development Officer. Joining for Q&A is Dr. Mitchell Goldman, Chief Medical Officer; and Ellen Rosenberg, Chief Legal Officer. As referenced on Slide 2, we might make forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 relating to our business as well as our plans and prospects.
Our forward-looking statements should not be regarded as representation by us and any of our plans will be achieved. Any or all the forward-looking statements made on this call may turn out to be wrong and can be affected by inaccurate assumptions we might make or by known or unknown risks and uncertainties. You are cautioned not to place undue reliance on any forward-looking statements, which speak only to the date hereof. All forward-looking statements are qualified in their entirety by this cautionary statement and we undertake no obligation to revise or update this presentation and conference call to reflect events or circumstances after the date hereof. For a full discussion of such forward-looking statements and the risks and uncertainties that may impact them, we refer you to the forward-looking statements and risk factors section of our annual report on Form 10-K for the year ended December 31st, 2023 and the quarterly report on Form 10-Q for the quarter ended March 31st, 2024 to be filed with the Securities and Exchange Commission today.
At this time, it's my pleasure to turn the call over to Bradley Campbell, President and Chief Executive Officer. Bradley?
Bradley Campbell: Great. Thank you, Andrew and welcome everybody to our first quarter 2024 conference call. I'm pleased to report a strong start to the year across our global business. We continue to build on the momentum of significant top line revenue growth on our way to our first full year of non-GAAP profitability, while advancing our mission of bringing hope to patients and families affected by rare diseases. As we did in this morning's press release, let me just highlight several key points before I turn it over to the team to go to more detail. First, we continued our excellent commercial execution and delivered strong total revenue of $110 million, representing 28% growth year-over-year. Galafold continues its strong performance and we remain very pleased with the continued commercial uptake globally.
For the first quarter, Galafold revenue was $99 million globally, representing 16% growth year-over-year on a constant currency basis, coming in at the high end of our initial guidance for the year. For Galafold, we continue to observe strong trends across our key performance indicators in all key geographies in the first quarter, including continued demand through new patient starts from both the switch and naive populations in all of our leading markets and sustained patient compliance and adherence rates of over 90%. All of this is across the backdrop of a significant growth in the diagnosed and treated patients that we've highlighted previously. We see Galafold serving as the foundation of our business for the next decade and more. Based on Galafold's strong performance in the first year, we are pleased to be raising our full year 2024 revenue growth guidance from 11% to 16% to now 13% to 17%.
Second, let me highlight the strong global commercial launch of Pombiliti and Opfolda, our novel 2 component therapy for late-asset, Pompe disease, now launched in Germany, Austria, the U.K., the U.S., and also now in Spain. Pom-Opf, as we like to call it, is a huge driver of growth for us this year and our progress against our key performance indicators that we've shared previously continues to demonstrate the strength of this launch. Our number one focus for this year is to maximize the number of patients on therapy by year-end and in light of that, it's great to report that the rate of new commercial patients coming on to Pom-Opf in 2024 is double that of last year. In fact, in the month of April, we saw the largest number of new commercial patients start on Pombiliti and Opfolda since our launch.
And as of the end of last month, we had 155 patients on treatment or scheduled for treatment. We're incredibly pleased with the patient and physician demand for this new therapy globally and continue to hear inspiring anecdotes from treaters around the world on how their patients are responding to Pombiliti and Opfolda, which will help continue to build the momentum throughout the year and beyond. Sebastian will provide more details in a moment, but the switch dynamics in the U.S., Europe, and U.K. also continue to look strong, and we're seeing great progress on the reimbursement front globally, including moving patients more quickly through the insurance process in the U.S. as we anticipated we would. We've also just launched in Spain are off to a great start there.
And throughout the remainder of 2024, we'll focus on increasing patient access as we gain reimbursement and then launch in additional countries throughout Europe. Before I turn it over to the team, let me also comment on the new guidance we're providing. As we set upon approval and coming into this year, we needed about six to 12 months of trends before we had enough information to provide revenue guidance. Now, with more than six months since launch in the three largest Pompe markets and the great trends we're seeing, we feel we now have enough information to accurately forecast our performance for the year. You'll see in the press release and in the slides, for the first time, we've announced that we expect to deliver $62 million to $67 million in global sales, which will again be a significant contributor to our growth and set us on a great course to achieve our ambition for Pombiliti and Opfolda become the new standard-of-care in treating this devastating disease.
We are incredibly pleased to be providing a real choice for patients and physicians and challenging therapeutic expectations for people living with Pompe disease. Finally, as we continue our excellent commercial execution across both therapies and prudently manage our resources, we are confident we are well on track to achieve full year non-GAAP profitability in 2024. Ahead on Slide 4, as we laid out at the beginning of the year, we continue to focus on delivering against our three -- excuse me, our four key strategic priorities, including sustaining double-digit Galafold revenue growth on the back of strong sales, again, we've raised expected annual growth rate of Galafold to 13% to 17% to constant exchange rates; successfully executing on multiple commercial launches of Pombiliti and Opfolda; advancing our ongoing studies to support our medical and scientific leadership in Fabry and Pompe disease; and maintaining our strong financial position as we carefully manage our expenses and investments to achieve non-GAAP profitability for the full year.
With that overview, let me now hand the call over to Sebastian to further highlight our commercial performance. Sebastian?
Sebastien Martel: Thank you, Bradley, and good morning to everyone on the call. I'll start by providing you with more details on our Galafold performance so far this year. As you can see on Slide 6, for the first quarter 2024, Galafold reported revenue reached $99.4 million, primarily driven by strong patient demand, particularly from our leading markets. We ended the first quarter with more than 60% of the global market share of treated amenable patients, but we know there's still many more potential patients for our therapy. As Bradley highlighted, given Galafold's strong performance in the first quarter, we're increasing our full year 2024 revenue growth guidance from 11% to 16% to now 13% to 17% growth. Turning on to Slide 7, our results in the first quarter highlight the strength of our global commercial efforts.
The demand for Galafold globally continues to be strong with patients added in all major markets, delivering operational growth of 16% over the same period in 2023. We're very pleased to see that Galafold grew at the high end of our initial guidance range in Q1 2024. And Galafold continues to be the fastest-growing treatment for Fabry disease globally. Our leading markets such as the U.S., the U.K., top EU countries, and Japan remain the biggest drivers of patient demand and needs great confidence in the growth this product has over the long-term. With the global mix, which is about 42% switch and 58% naive now, we're seeing stronger uptake in naive population. So, we continue to achieve high market shares in countries where we've been approved the longest.
There's still plenty of opportunity to continue to treat patients over to Galafold and to keep growing the market as we penetrate the diagnosed and treated and newly dinar segments. All of this is underpinned by sustained compliance and adherence rates that continue to exceed 90%, reiterating our belief that those who go on Galafold predominantly stay on Galafold. As mentioned on past calls, due to a variety of factors, including uneven ordering patterns and FX fluctuations, the rate of growth within the year is typically non-linear. We expect that to continue in 2024. So, within the table on the right-hand side of the slide, we've provided a five-year historical snapshot of the percentage of Galafold sales that occurred each quarter during a given year.
The average of quarterly sales distribution over the last five years corresponds precisely to what we achieved for the full year 2023. We would expect a similar trend to occur this year. And so as an example, we expect Q2 sales in the current year to be around 24% of full year sales. On Slide 8, we know that there is significant patient demand for Galafold and as the segment of the global Fabry market made of patients with amenable mutations has the potential to reach up to $1 billion in annual revenue by the end of the decade. We anticipate sustained growth in 2024 and beyond to be driven by several key growth drivers. First, the Fabry market is growing robustly and with a significant portion of growth coming from finding new patients and reaching the diagnosed and treated population.
As we've mentioned previously, there were more than 2,500 individuals on Galafold at the end of 2023 and about 1,400 of those individuals were naive to any treatment before Galafold. Second, we've seen in many new patients going through treatment through newborn and family screening and we continue to increase patient identification capabilities through ongoing medical education and support of Novel screening initiatives, including the use of artificial intelligence through our partnership with OM1. Fabry one of the most underdiagnosed rate disease. So, the more patients that can be identified, the more patients can be eligible for Galafold. We're also seeing many diagnosed and treated patients transition to treatment as the need for earlier treatment, especially in female becomes better appreciated.
The other piece is continuing to drive Galafold's market share of treated amenable patients through continued commercial execution. As noted, Galafold currently has more than 60% of the global amenable market, but we're seeing in our most mature markets that we can reach up to about 85%, 90% of market share. So, we know that there's the potential to reach those levels in the global market share as well. And again, all of these efforts are supported by solid compliance and adherence rates through physician and patient education and support programs. Additionally, we'll continue to make progress on expanding Galafold into new markets and extending the labels. There's still some markets in LatAm, the Middle East, Asia-Pacific region where Galafold is either newly reimbursed or we expect reimbursement.
Also important to note here, we have offer exclusivity in the U.S. and Europe. In addition to our now 58 Orange-Book-listed patents, 42 of which provide protection into 2038 and beyond, including 12 composition of matter patents. This provides us the opportunity to provide access to Galafold globally for a long time to come. We intend to continue to protect and enforce our broad intellectual property rights. And looking ahead, we expect steady double-digit growth for Galafold throughout 2024, and we remain confident that with our strong IP protection, Galafold is a long runway well into the next decade. Turning now to Pompe disease on Slide 10. We outline our global launch progress with Pombiliti and Opfolda. For the first quarter 2024, Pombiliti and Opfolda reported revenue reached $11 million.
This represents an increase of 30% compared to the fourth quarter of 2023 and provides a strong foundation for 2024. In the first quarter, we actually achieved the same level of sales as we did in the last six months of 2023. In the U.S., we continue to see a majority of patients switching from Nexviazyme, about 73% and the remaining 27% from Lumizyme. This means we're switching patients proportionately from both products. We're also seeing a broadening and deepening of prescriptions with more sites coming online and multiple new prescriptions. Outside of the U.S., we're seeing patients from all three segments, some switching from Myozyme from Nexviazyme at a proportional rate to the respective market shares and some from the naive population.
That's exactly what we want to see at this stage. A few updates on the launch in Europe. We're happy to announce that Pombiliti and Opfolda is now reimbursed and launched in Spain, occurring ahead of our internal expectations. We're very pleased with the fast reimbursement process here and increased access to this therapy throughout the European Union. In Germany, we're delighted with ongoing success in one of our largest European markets. Recently, the Federal Joint Committee, the GBA, designated Pombiliti and Opfolda with minor additional benefits versus alglucosidase alfa or Myozyme based on an extremely stringent review of the data in the PROPEL trial. This is a great achievement as Pombiliti and Opfolda is the only Pompe treatment to receive this designation and reflects the value HDers are seeing in this therapy.
This also reinforces our belief that this therapy has the potential to reset treatment expectations and that the improvement is possible. And finally, we remain very pleased with the uptake of Pombiliti and Opfolda in the U.K., where we are heading towards capturing the majority of market share. Currently, we're close to passing one-third of market share within the U.K. with the benefit of [Indiscernible], Pombiliti and Opfolda has actually been available for now two years in the U.K., and we believe that the current market share is indicative of how this product can perform over a three-year period and is a great example of Pombiliti and Opfolda potential demand and uptake. Given increased visibility on patient trends and pricing and reimbursement, we're now able to provide full year revenue guidance for Pombiliti and Opfolda.
For the year 2024, we anticipate revenue of $62 million to $67 million for Pombiliti and Opfolda. To put this in perspective, this is roughly 75% more sales than the first full year of sales from Galafold, which was a great launch by all accounts. Moving on to Slide 11. As Bradley mentioned earlier, there are about 155 patients on treatment or scheduled for treatment as of late April. That's about 130 currency on therapy and about 20 who are scheduled. We continue to be very pleased with ongoing demand for this therapy as the rate of new commercial patients coming on to Pombiliti and Opfolda continues to increase across all three markets. Of note, Q1 was the best quarter yet for new commercial patient staff, doubling the rate of new patient starts from 2023.
In particular, April was the strongest month to-date for new patient starts and new commercial patients. This is important as it further supports our thesis that launch momentum will continue to build throughout the year as we move more quickly through the prescription to treatment process in the U.S. and as we launch in new countries in Europe. Our launch has leveraged our highly experienced cross-functional team, and we've had great outreach with key opinion leaders. We're seeing an increase in the depth and breadth of prescribers across all three markets and in particular, a growing number of prescribers who are not part of our clinical studies or expanded access programs. All core treating centers have been engaged and we've had very positive feedback from HCPs and other stakeholders as to our business approach, our support, and patient focus.
Finally, we find an important metric to track is our progress with access and reimbursement. We have a highly experienced team who are engaging in positive conversations with payers to demonstrate the value of Pombiliti and Opfolda. In the U.S. and with the start of the new year, many large payers have already put Pombiliti and Opfolda to their respective formularies. And we've also seen strong acceptance by Medicare, Medicaid. The overall time from prescription to infusion is now down to around 70 days. The last few commercial patients have actually come in even quicker. We believe that this will continue to improve. Today, we launched in Germany, in Austria, in the U.K., the U.S., and now Spain, but we remain in active pricing and reimbursement discussions with additional major markets as we focus on securing broad patient access throughout the European Union.
More than 10 reimbursement dossiers have been submitted. Overall, we're starting off the year strong and we're very pleased with the building momentum on patient demand. Throughout 2024, our focus will be on maximizing the number of patients on therapy by year-end. So, in summary, we're very pleased with the launches of Pombiliti and Opfolda across the first wave of countries. The strength of our clinical data, and the depth of experience and talent we have at Amicus gives us great confidence in our ability to make a real difference for people living with Pompe disease. We believe Amicus is in a great position with our second successful launch. And with that, I will hand the call over to Jeff Castelli, our Chief Development Officer, to discuss the ongoing clinical studies and regulatory updates.
Jeff?
Jeff Castelli: Thank you, Sebastien, and good morning, everyone. Moving on to Slide 12, we remind everyone that we continue to build the body of evidence for Pombiliti and Opfolda through our ongoing clinical studies and our registry as we also continue to execute on expanding commercial access through regulatory submissions. As we entered the second phase of launch, in addition to the 10 different reimbursement dossiers that we're in the process of submitting or have submitted that Sebastian mentioned, we also have multiple ongoing or planned regulatory submissions for marketing approval in new geographies throughout this year. As we speak, our regulatory dossiers are being reviewed in Switzerland, Australia, and Canada, and we're working towards a submission in Japan in the second half of this year.
Importantly, for the younger Pompe community, we continue to enroll the ongoing open-label ZIP study for children living with late onset Pompe disease and the open-label REZELLA [ph] study for children living with infantile onset Pompe disease. We see this as an important opportunity to support label expansions into these patient segments in the years ahead and to address the significant unmet needs in these patients. Through our ongoing studies in the Amicus Pompe registry, we continue to generate evidence on the differentiated mechanism of action and the long-term impact of Pombiliti and Opfolda across endpoints and different patient populations. As a reminder, in February, we once again had a significant presence and very successful set of interactions at the 20th Annual World Symposium.
We had 11 posters and an oral presentation highlighting our continued work across Fabry Pompe disease. Our medical conference presence is an important part of our education efforts. Finally, as highlighted in the pipeline side in the appendix for our earlier stage pipeline, we continue to focus on novel approaches for Fabry and Pompe, including delivery of our engineered GLA and GAA transgene as well as the next-generation Fabry-Chaperone. With that, I would like to turn the call over to Simon Harford, our Chief Financial Officer, to review our financial results, guidance, and outlook. Simon?
Simon Harford: Thank you, Jeff. Our financial overview begins on Slide 14 with our income statement for the first quarter ending March 31st, 2024. For Q1, we achieved total revenue of $110 million, which is a 28% increase over the same period in 2023. At constant exchange rates, revenue also grew 28%. The global geographic breakdown of total revenue during the quarter consisted of $73 million or 66% of revenue generated outside the United States and the remaining $37 million or 34% coming from within the U.S. Cost of goods sold as a percentage of net sales was 12% in Q1 due to validation costs in the quarter as compared to 8% for the prior year period. Total GAAP operating expenses increased to $125 million for the first quarter of 2024 as compared to $117 million in the first quarter of 2023, an increase of 6% due primarily to a facilities lease restructuring charge.
On a non-GAAP basis, total operating expenses increased to $86 million for the first quarter of 2024 as compared to $81 million in the first quarter of last year. We define non-GAAP operating expenses, research and development and SG&A expenses, excluding stock-based compensation, loss on impairment of assets, changes in fair value of contingent consideration, restructuring charges, and depreciation. On a GAAP basis, net loss for the first quarter 2024 reduced to $48 million or $0.16 per share compared to a net loss of $53 million or $0.18 per share for the first quarter of last year. In Q1 2024, there was a non-GAAP net loss of $4.6 million, driven by the negative impact of foreign exchange. This was in line with our expectations of a small loss in Q1 as absolute dollar revenue is traditionally lower in the first quarter.
Cash, cash equivalents, and marketable securities were $240 million as of March 31st, 2024, compared to $286 million as of the end of December 2023. Turning now to Slide 15, we are guiding to full year 2024 total revenue growth of 25% to 30%. This is driven by the increase of our full year 2024 Galafold revenue growth guidance from 11% to 16% previously to 13% to 17% currently at constant exchange rates. It is also driven by guidance of $62 million to $67 million for Pombiliti, Opfolda sales for the full year. On full year 2024 non-GAAP operating expense guidance remains at $345 million to $365 million. With our commitment to full year non-GAAP profitability during the first full year of launch of Pombiliti, Opfolda, we are keeping operating expense growth in low single digits year-over-year at the midpoint of guidance.
As a reminder, we continue to have R&D commitments, including registry studies in both Fabry and Pompe, the ongoing Pompe Phase 3 study in countries not yet reimbursed, as well as next-generation manufacturing for Pombiliti. With our total revenue guidance of 25% to 30%, we remain comfortably on track to achieve our first full year of non-GAAP profitability in 2024 as profitability grows quarter-by-quarter for the remainder of the year. And with that, let me turn the call back over to Bradley for our closing remarks. Bradley?
Bradley Campbell: Thank you, Simon, Jeff, Sebastian, for the further color. So, as you can see, we have been highly focused on execution this year across the business, and we've made a strong foundation for what will be another important year of commercial execution. We're confident in our leadership position in Fabry and Pompe disease and at Amicus can continue to drive sustainable long-term value and deliver life-changing therapies to people in need. With that, operator, we can now turn the call over to questions.
See also
16 Biggest Publicly Traded AI Companies in the World and
25 Countries with the Lowest Home Ownership Rates.
To continue reading the Q&A session, please click here.
