- Earnings call transcript Q3 2022

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Operator

Good day. And welcome to the Vertex Pharmaceuticals Third Quarter 2022 Earnings Call. All participants will be in a listen-only mode. [Operator Instructions] After today’s presentation, there will be an opportunity to ask questions. [Operator Instructions] Please note this event is being recorded. to conference like to now would turn over the Ms. I Lisa. Susie ahead, Please go ma’am.

Susie Lisa

the My Lisa, call, Senior is thrilled evening, conference President; Reshma Charlie recommend our name Good recorded CEO all. financial be XXXX Susie remarks, Investor Welcome joined results and call we Stuart as slides access Wagner, that website. Financial Vertex’s Operating third Dr. The and on quarter Arbuckle, of available listen Kewalramani, Officer; On to and you Vertex and prepared We the Chief President new tonight’s Officer. you Vice call. Relations. call. to will to making webcast as Chief have our a am this replay being I have is

this outcomes financial Actual management’s this will that select on non-GAAP will results guidance based events could Securities would forward-looking turn on note now and that These Exchange risks current and in make to call basis. the in on our medicines, the uncertainties financial release statements, and assumptions. Vertex’s materially. today’s evening that Reshma. the marketed without the press on are performance call review we those also will pipeline to future with differ subject and statements presented and filings regarding are are discussed Vertex’s detail limitation, cystic Commission. I fibrosis including, our call I in a and We over

Dr. Reshma Kewalramani

Thanks, Susie.

our transformative towards initiated clinical and third progress growing benefit patients product revenues mid- wave cystic in evening commercial quarter, CF growth; we innovation performance, our our to us advancing focus next of global next three, with medicines for urgency $X.X increased launches; and the two, more the XXXX continues will preparing reach. XX% reaching CFTR on modulators. fibrosis one, on CF to to reach develop exceptionally $X.X year-on-year $X.X to the clinic. to we numbers We patients billion. strong Vertex diverse and billion are four, have the on working and product with full the Board. the make revenue multiple disease have areas; towards patients you progressing are from hear to in of strong Despite therapies. thank many sustainable modulators, call delighted $X.X to late-stage significant our $X.X pipeline In joining as Stuart, for Based resulting of; on are well still to all around goals all raising you today. our CFTR who Good all And billion may billion we patients year as globe treatment patients with more from you and from guidance to billion, the execute

inflection of an acute is type pain, effective in we AATD promise to are patients, to the approach company deep R&D the represents deliver As internal durable With the and as and balance turn external potentially said, a strong develop come. in with does and safety to for that franchise, multibillion the pipeline well uniquely world a patients each and for TRIKAFTA with opportunity. real of and shareholders will strong recent the a as sets clinical of even people, starting to holds first-in-class CF progress to are so. disease or is disease both a terms be in registrational efficacy medicines programs, sickle more cell opportunities, and company, determined it our the transform important capacity AMKD, a at multiple if CF to commercial invest and best-in-class X a and is With near-term broad That positioned innovation that each the long-term previously discussed, stage we in high possible for dollar deeply trials, talented studies. I point to CF. bar and that beta-thalassemia, very diabetes and details well overview, Vertex R&D and years for sheet,

triple The progressing to XX referred potential. development triple combination, now in vanzacaftor triple patients our Phase or enrollment vanzacaftor/tezacaftor/deutivacaftor the through VX-XXX/tezacaftor/VX-XXX, holds this complete rapidly next-in-class projected now Our studies with year. that is older, and III ages as to

with demonstrated benefit epithelial bronchial our As and in a we clinical Phase have greater human our reminder, this medicines. II prior greater versus TRIKAFTA seen combination in any assay of than activity

the Additionally, the in low it TRIKAFTA. double single for versus once-daily royalties convenience and offers digits dosing digits of low

an any protein, patients not X,XXX on the with CFTR who our Moderna. working we therapy are For mRNA make do at partners

completed quarter with with We that for work to this not we And thereafter. on to program even track done, and studies IND clinical better patients CF remain our this continues have therapies are an more chloride. could IND-enabling starting of identify carrier we sweat potential levels bring trials submit to

package the both of to exa-cel available U.S. we by We the these our also the in review. EU transfusion-dependent for granted next submissions patients data and filing we our XXXX. reached we regulatory in the and and the that previously pivotal that addition plan U.S. virtually granted Europe, to from rolling next first patients. remain now disease for or This XX by up editing of and U.K., severe months our the trials follow-up for beta-thalassemia this of of EMEA to CF CTXXXX, potential Last exa-cel demonstrated shared begin BLA provide exa-cel. month, one-time and in year. our expect with We the to cell on functional data advanced our gene the track outside Turning designations, of a respectively. MHRA be sickle having disease a end exa-cel, has to with launch. the we In sickle known June, is from to these exa-cel’s to program FDA announced all cure as The submit beta-thalassemia program most we commercial and agreement end complete submissions TDT. In previously cell month presented XX on quarter MAAs

in separate intensely to patients Our teams bring order these exa-cel quickly focused agencies with multiple possible. complex are on to as submissions preparing regulatory as three

Given represents for the first thousands look XXXX. that disease at instead, forward severe disease new therapy transfusion-dependent sharing in clinical near-term half updated promise of the holds and data of patients priority, Exa-cel be will for sickle a with genetic first with treatment to potentially significant sharing to gene cell for market a be patients beta-thalassemia. clinical opportunity. data not also curative ASH, we editing the but and This a CRISPR-based onetime therapy commercialized

pharmacologically same two pain pivotal selective acute, Phase bunionectomy endpoint, pain with has out difference, in study of design of II the potential XX pain generally or to acute NaVX.X patients acute in the has to of in included effects the tolerated. a evaluation that label will third is pain offers days. post the studies. track study treatment VX-XXX III potential up sum target. same support earlier-generation that hours pain. highly Phase over and on opioid randomized VX-XXX the VX-XXX pain of musculoskeletal the multiple status, Phase A a trials. design to and and to of regard of agreement therapy treatment been similar placebo-controlled XX the moderate program. and two of hours to SPID, well moderate opioids. and intensity FDA in the studies genetically regulatory program and granted relief in of the The inhibitor, been primary the and acute an support was in of clinically severe for NaVX.X of inhibitor initiated With III the III single-arm study other consists The pain fast to Phase post arm enroll pain relief The to acute broad without We of and placebo. the program designation of Turning and also rounds neuropathic effective very VX-XXX II plan compared both same Phase VX-XXX, reached showed significant NaVX.X in pain placebo a the U.S. VX-XXX RCTs VX-XXX. period Recall novel meaningful with VX-XXX completed statistically recently the abdominoplasty, with an states, breakthrough side studied studies, our program. demonstrated concept addictive validated our and positive duration, is a to severe or XX proof types pivotal to This is development controlled compared pain reference

the effective and potential executing short Given duration trials without for pain side we the need efficiently, a or market addictive near-term our significant and high treatment experience as types VX-XXX significant view of unmet in these opioids, effects of opportunity. the relief

year. study proof-of-concept remain and initiate towards study of diabetic dose the in to to ranging painful in II VX-XXX pain plan a also patients We end this on neuropathy Phase track with neuropathic

Moving disease of reduction for kidney II/III decline compared or treat treated or has the placebo-controlled prime U.S. top potential of kidney medicine the AMKD. rate cause adaptive, designation approximately standard-of-care the Phase standard-of-care both the being the randomized, APOLX-mediated with VX-XXX, in pivotal double-blind, and to drug designation and Inaxiplin on to Europe. is and endpoint single trial years. in breakthrough in a inaxaplin primary therapy two orphan is Inaxaplin inaxaplin studied first in to a of patients underlying function of in

with sites the study open progress weeks positive, forward as of the XXX enrollment for Importantly, sites trial a open enrolling U.S. the if the approval in more at We is for in is as in We serve basis internationally analysis the This a the total. enrollment U.S. more have study and trial now you XX accelerated look in than than preplanned advances. underway and patients. interim treatment, to could on updating to which XX goal

type to X on diabetes. moving Next,

programs three We have been portfolio. advancing our in

stem cells two First, to clinical VX-XXX, therapy therapy, In the diabetes. immunosuppressive is replacement for other These mid-stage development. cells program, differentiated we insulin-producing immune system. use are programs islet foundation our cell in the a from cell-derived, X protect the our same standard which type this fully

differentiated encapsulates the immunosuppressants. program program, not islet to device and Next, fully remain by shields the in this on for file the proprietary IND We the body’s track year. plus which require that cells cells immune of the system a cells this device does these end from

a type diabetes the The dose of two full in enormous of need for in study. editing same the system, the cells obviating VX-XXX for at fully hypoimmune Lastly, A we underway immunosuppressants. patients. concept year, Earlier is in dosed Part immune Part dose the X holds enrolling program, of with type are we the first the development, from insulin-producing differentiated is the program achieved diabetes half which them to this cloak study, and from in proof at treatment patients potential. uses which preclinical There cells B X with islet our patients target longer provide to sharing our the alone to look need additional are in acquisition extend of follow-up X.X type A or more our welcome fear potential on forward from diabetes EU than X to with a the program, more benefit without want and hypoglycemia and colleagues. We word U.S. who duration data the diabetes having control time. I last insulin. million closed warm the glucose the the for appropriate type recently Viacyte, patients Viacyte to X of may of

Let next and Alpha-X me has clinical series first-in-human wave in that deficiency, Earlier cleared announced of antitrypsin entered this with for month, AATD VX-XXX, or has IND correctors trials. the the our program. first we AAT VX-XXX close a

assess Stuart soon will XX-week treatment With R&D review polymer liver, from that of initiate. will for of a levels as impact announced of the Phase study of the VX-XXX, II I as longer also those progress. highlights, will term on serum it on corrector hand first-generation a to our This commercial clearance AAT. well our study over We functional AAT

Stuart Arbuckle

pleased the our compliance we U.S., pain. the strong as the U.S., treat KAFTRIO/TRIKAFTA Starting the Reshma. business, therapy progress uptake high helping age seen Thanks, maintain with commercial opportunities countries and of our in persistence outlook CF, we prepare very Outside by our therapies benefits to am we in the VX-XXX is our I performance the to see have commercial of in role reimbursement of have and in continued and multiple focus agreements. rapid significant growth in strong of with launch to extend seen the well as promising made tonight with groups. to our across of review near-term to exa-cel recent younger CF, CF, the for including driven view the

five in continents. approved of children of indication XX We have also on benefiting thousands patients seen has this KAFTRIO strong of access. tens to uptake in where cystic fibrosis more six and our in than reimbursed Today, medicines ages reimbursed countries, XX countries are

However, younger the two, still reimbursement in of with on early for such for a label categories; are one, of treatment. are are for into countries where reimbursement extensions label pursue reimbursement patients launch awaiting in patients extensions; achieved or patients; the there curve, These thousands number fall following CF and yet to continue not we we countries. three, agreements patients and on patients our extent, small those groups younger who patients to in medicines recently as age a whom primarily lesser

We that near- the are vast and time, drive patients revenue growth in confident reach will which these majority we will of long the over term. continued

children make XX expanding CFTR approved was September, ORKAMBI in our younger U.S. for modulators to to progress than months XX age label less We groups. the excellent continue for the to In ages months

we months in U.S. global regulatory old end of of Similarly, one TRIKAFTA end four before children children by approval two in authorities We submit five U.S. years for to other to expect than to file the KALYDECO approval of the XXXX. less ages to will of the years the year. and month for FDA

targets Finally, underlying Reshma in patients CF, approximately cause an in mentioned, of our This this X,XXX program is the worldwide. progressing mRNA IND CF toward program CFTR submission year. disease as

have comments launches, opportunity and we for and pipeline. start with to patients diverse efforts broad, market potential preparation product R&D exa-cel advanced our we readiness fully process and exa-cel patients. and in progress significant Exa-cel with transfusion-dependent opportunities such takes for next I finish my offering both from recognize focus are curative activities. commercial disease a significant potentially and the for cell that CF, holds Beyond our we VX-XXX. potential and months sickle curative will with the beta-thalassemia, and a challenges a novel, is making Treatment launch on therapy

We commercial we are physicians support to required approvals. creating believe will that and lead upon for patients potential regulatory the infrastructure success and

policymakers the teams similar hired trained and ongoing treatment field in commercial with are efforts and liaison Our and and These engaging medical key are have centers, actively science teams in U.S. been Europe. payers

context, the the Our these focus in we reside approximately and in effectively calling centers. patients centers the Europe. network qualified believe on cell vast are use highly of with disease By approximately on initial approximately the of severe concentrated launch U.S. exa-cel and in of vast served the sickle XX to and XX,XXX in exa-cel. certain be we technical a Roughly treatment can have treatment potential disease with CF and patients future beta-thalassemia. of patients whom support the majority of and in authorized the These forms in of reached the majority Europe they are XX thus, way of XX,XXX patients, sickle will XX,XXX U.S. patients medical by cell CF U.S. These expertise estimated the severe centers XXX U.S. geographies, of

as centers Our field well engaging logistical support capabilities, on the and teams launch. are as these already needed with treatment the capacity to the administrative

these from and consideration, centers that working engagement to In like treatment these that parallel Payment the burden with of bring centers, exa-cel and to been with early engaging to with these We we the diseases. potentially ensure significant and closely and models the curative interest given important patients stakeholders have therapy value been have the policymakers the staff. are a by system. payers encouraged healthcare one-time understand an their can

ensure eligible curative to who potentially exa-cel patients with access for to have this stakeholders We continuing to work are various may be therapy.

important musculoskeletal Turning pain across that the including has spectrum, to believe pain. the to play an and we acute, pain., neuropathic potential VX-XXX an role

infrastructure focus physicians a now One, pain patients. U.S. in there my initiation of pain the XX% program the though framing around in to is opportunity I in in remarks addressable trials, hospital for the are critical recent options Two, Vertex these is given billion, thus commercial setting and Vertex. pain specialty acute treatment VX-XXX of potential opportunity. safe three, key Phase prescribing for and exciting for an with and period is generic. market III significant will near-term the aspects, market significant, and three market commercial for even the acute the model. acute effective With the $X a treatment concentrated And is fits the is the gap short the that prescriptions today

Firstly, oral billion and $X received X.X penetration, approximately multibillion is new for XX% medicine, market pain, billion treatment of class patients of despite highly generic the a treatment dollar annually U.S. some the potential. days has acute well-tolerated and effective therefore,

following and the includes for management. during of billion in by Secondly, room discharge visits. written prescriptions stay or driven are two-thirds patient’s and inpatient hospital treatment outpatient at the patient course such pain these multi-day procedures ongoing or those with of to provide hospital a This roughly filled prescribing as or $X the surgeries days written emergency medicine

of Given prescribing. specialty consideration has physicians attempted can the of proportion believe we John the strict have prescribing from In to agencies measures hospital been for hospitals, effects pain. treatment for market of infrastructure. and to pain clear concentration of reduce limited as acute the of the by side marketplace sales opioids the is Hopkins the Kaiser significant systems, factor as epidemic. this key therapy. and large U.S. and driven And opioid acute enacted the prescribing, response, pain marketing contributing a deaths as or of opioids rise Many of opioid use Medicine the have U.S. states, state treatment we throughout reach have opioid to such hospital a well Permanente reduce that this Overdose large third a opioid is to treatment a continued with and in

lack stay result treatment on highly can nor limitations the in extremely with These of new a in In NSAIDs, you safe could benefits in over an does extend about next have the more excited I nausea, have of used these coming valuable effective and for for effect constipation of increased side the the a call treatment non-opioid treatment as create patients for be opioids after I length other In not the treatment acute the in view the therapy to opioids opportunity transformative in review potential, of of commercialization gap opioids opportunity significant with availability our addictive the novel, a plans neuropathic opioids to over around the and turn pain pain negative and a market patients to including as only being and that like the the commercialize and forward because resolve. be further doctors hospital will significant globe, prescription Therefore, to our option more strategy last and outside of Charlie a near-term problems the of multiple addition, would the CF the resort. until months. with serious step of diseases options look profile relegating of our patients. treatment somnolence, beyond effective, concerns VX-XXX, potential addictive side pain, effects, am to now including updating I the treatments CF. financials. potential medicines and to used closing,

Charlie Wagner

Thanks, execution. pace performance Stuart. results financial another year-to-date and Vertex’s strong on year us of quarter for third XXXX and set exceptional

outside penetration billion, aided groups. into was quarter by strong the to increased up of Third U.S. well CF age into consistent in younger XX% age as label revenue with XX% achieved extensions XXXX ongoing on as led U.S. reimbursement, groups. $X.X TRIKAFTA/KAFTRIO performance recently uptake X% younger revenue continued with year-over-year markets growth by

During phasing revenue benefited the and these expect full to from the updated quarterly reflected markets. We in approximately growth an do our fourth purchases million in recur is not year certain guidance. channel in CF inventory in increase $XX this third quarter also quarter,

an build-out are now QX continued compared R&D SG&A and XXXX seven invest combined CF as pain, notably activities for continued which development. these IP programs, year-over-year of mRNA acquired Third X XXXX, XX% reflects in million, $XXX pre-commercial diabetes, investments to stepped-up five triple pipeline, in of non-GAAP and in the programs, have expenses the quarter our as exa-cel. to increase pivotal were quarter and in XXXX. which The the Throughout third of R&D, increase vanzacaftor new we R&D type in includes well

and Looking forward, for as stage to invest research pipeline, we continue including programs commercial commercial well our activities to in as clinical exa-cel potential, with VX-XXX for significant expect near-term readiness pain. in and

augmenting our aligned We with to also R&D internal with committed strategy. innovation remain our efforts research external

was non-GAAP prior operating Third We quarter the non-GAAP of $X.X XX% income the in XX%. quarter, billion operating versus XXXX margin an of generated increase year period.

rate in balance strong. billion tax ended as and flow investments sheet XXXX of quarter the and very non-GAAP XX%. Our our quarter the generation third remain cash in $X.X with We cash effective was

business and the acquisition we development million On underway. integration front, for $XXX announced the cash are in ViaCyte closed previously activities of

the year we to $X.X XXXX guidance million by the guidance, XX% rate full versus change midpoint, and recent double-digit strong the revenue XX%. in switching revenue increase range continued of consecutive full At change to our guidance also to non-GAAP approximately There XXXX will Now new of projected markets IP of billion. R&D, The and increased is reimbursement $X.X the and Xth no billion with mark range no our performance to There guidance to product is XX% XXXX to to tax are growth. effective CF the acquired $X.X billion. midpoint $X in increasing of represents R&D non-GAAP combined range reflects U.S. our uptake a growth year revenue expense at $XXX year TRIKAFTA/KAFTRIO billion SG&A of Vertex’s agreements XXXX of

exchange, currencies movements the foreign the foreign mitigated of euro in the by since management exchange dollar our impact on of versus the the program. comment start is a the risk strengthening partially of significant other U.S. year Finally, and

Vertex net challenging exchange, the will a despite reflected of program closing, updated rates, In the year For on our for changes well our range revenue negative climate. have and estimate in guidance XXXX, is approximately X% effects growth impact macroeconomic that foreign this current the revenue full performing of year. at we is in exceptionally

to we important mark on continued slide. milestones as look this our highlighted remainder of XXXX XXXX, and progress the to forward further For into

R&D the company and Vertex our over growth diversifying has adding acceleration and long-term Reshma pipeline to on well a our past significant noted, are profile. the in seen way we our As year, to

forward look our to we progress future updating calls. you on always, As on

Let me to the the call Susie begin question-and-answer period. back turn to

Susie Lisa

begin please? Thanks, Charlie. Q, you the Chuck, will

Operator

Instructions] ahead. will come Yes, the with ma’am. And [Operator from go Michael question first Please Yee Jefferies.

Unidentified Analyst

is Dennis the be the should data for this the remind great? worth think is Can initial device of diabetes the just see only data progress you Congrats This Mike. get And ongoing VX-XXX? Thank year on how can you. in regarding and in program, us we that quarter. and program, beta can of for comment we on if [ph] XXXX will level Hi. if the and disclosure a you I, please that status you Phase disclosed about will updated data single like patient’s VX-XXX for the we that on where something given that of

Dr. Reshma Kewalramani

very much Thanks Hey. for that.

within Your X our are type question portfolio. just three diabetes programs is and about X ground everyone. type actually There our to program diabetes

is that I/II. first and one The VX-XXX, in actually is Phase

in That’s dose. already that’s in program patients have half concept of first with on program continuing. targeted the a it’s treated, importantly program is achieved patients. the proof already two That now So based the which we

and are conference at the the full data share at to year or targeted patients expect we do venue. and We next dosing dose enrolling appropriate

data, expect programs. we right that a to small of might treatment type plus CTXXXX from data therapy, program. the IND patients able and this device closer patients, it’s terms plus with later diabetes with a regard into of one-time That in I we you that in tell you to cells portfolio number see lot right should be whether because what about cells device small mean we I program effect patients can programs, the would similar cells potentially for is, the and into and that on to program less alone its to emerging and go And are or profile. track reasonably molecule by our curative when is this second X year. what think the about has disclosures The With

it’s then type So when in to already molecules. that benefit have too the on immune cloak small X about I would closer them lastly, not CTX just to data, same vertical third little early to exactly program, program see order the pillar the or a allow that we bit diabetes up us think cells use And than and comment these will we would in the in to round the is to third cells exa-cel, editing demonstrated to from those the immunosuppressants. VX-XXX program are the that system have clinic, to but

Susie Lisa

please, question Next Chuck?

Operator

The Wells Mohit next question will Bansal come with go Fargo. ahead. Please from

Mohit Bansal

Great. taking well. my from and and Lisa to welcome congrats Susie my for as Thanks question side

a the percentage on X with So, maybe maximum one question who therapies. with there of are can that you XX could the these and expert more, end kind And was getting in the benefit is TRIKAFTA, you probably can what benefit. be maximum at achieve to FEV percentage points, extract these to potentiators percentage of X getting plateau correctors the point higher there and maybe mentioned points improvement that one at you we

the therapies? there, this you. maximum do get So statement you these get you probably with do assuming that next-generation to of Thank kind combo think does is with that that can agree you --

Dr. Reshma Kewalramani

Yeah. words. Hey, Mohit. the Thanks for kind

about modulators about that it’s realize in is bit general CFTR and little out can terms me think of Your in that CFTR the what When to as you broaden a disease. disease, benefit? question a more important systemic of question and we is a benefit just CF, it. expect Let blow modulators,

prominent a lung. manifestation, it’s is the not not very only manifestation but only It the is So manifestation. the

So difficulty weight, the endocrine in and life pancreatic by in what patients about do the They also that? mean height modulators. have and gaining exocrine quality disease, I have difficulty and of CFTR CF high difficulty a with you living with also absence liver disease. know gaining

with real start the seen we is and certainly modulators way lung indeed this ppFEVX. the in of improvement to TRIKAFTA benefit an that to up acutely So and function with all CFTR KALYDECO measure have the is way we

out specific VX-XXX/ that it think achieved, Phase benefit what on is TRIKAFTA and max, you is I combination, the benefits. ppFEVX But next search Now XX%, populations still study, in-class in in the which is get that’s the tell XX% II the had I combination. will that is, what In the be. is maximum to could question your the jury tezacaftor/XXX up

coming next So and translates of include have to lung benefit our to this still other benefits, to forward we some are TRIKAFTA that is it’s just of on out to. jury there pulmonary at that close the encouraging modulators. I look some data And hospitalizations think of also molecules the out from mortality, NACFC to really abstracts the And wave transplantation, and CFTR ppFEVX see exacerbations. terms benefit and out, in

Susie Lisa

Thank you, Mohit.

Mohit Bansal

Thanks. Helpful.

Susie Lisa

Chuck. please, question Next

Operator

The next Sachs. go Salveen will come Richter ahead. Please question with from Goldman

Salveen Richter

afternoon. Thanks questions. taking for my Good

two should integrity help you. us for the return the the that cash and you so billion protects here, stock cells program, the issue one to -- you look development, and that simultaneously then but here secondly, $XX type diabetes business aren’t thoughts cells expect to but can value in do creating to Just via if understand immune start in on we aren’t from or system, Thank And fully of if a how dividend? the going device? X to guess maintains have you you about I me your while buybacks here, you the

Dr. Reshma Kewalramani

Salveen. Thanks, Hey.

type details. you the I will with and frame start more Charlie me to and capital Let the question I just question, diabetes allocation ask give X will

nutrients and sufficient worked to where one, following; that have sensing has to to the into to even plus team prior reaction; combination, won a two, cells in, of protected and the traditional the the for On the immune oxygen occur. and the Semma of insulin on this of this nutrients device trouble the to and the foreign long get we body device that in the trying the that worked two, prevent for oxygenation have The and have account the also has that our cells; large can body studies, three, been with and X but cell are proprietary the release and hard and challenging say, cells use flow have credit issues, There used dose. X the the see all and all two the foreign we release this, program the of in diabetes that not ensure past proof-of-concept gone those glucose history a long and people in address can acquisition. context type devices Salveen, three, and diabetes differentiated, achievement allow is cells we we ability of the actually program no have of insulin namely and will the insulin. most those to and glucose we know oxygen; type reaction; sense nutrients having it including patients preclinical that protect half that will studies, cells, because in to part and the first VX-XXX fully of animal of to but the treated features at have producing, I part be cells are

on strategy changed. that? has and add the question, our to capital Charlie, not external. wanted The on anything allocation innovation, On focus capital internal is both to you

Charlie Wagner

No.

You very continues priority it well. The said investment innovation. be to in

shows. few last been think over and it very years we I active have the

of an XX% benefited looking external maintain priority. to pipeline function, now, pipeline so active at to innovation our from done be at continue we will recent years look that we the have efforts the to that internal continue you programs in If in and BD support have our the

share in We and buyback primary in dilution, have years offset purpose program maintained is but just innovation. to a focus the the investment recent also

Salveen Richter

Thank you.

Susie Lisa

Salveen. Thanks,

Next question please, Chuck.

Operator

Nadeau come ahead. Company. with Cowen The next Please from go question Phil & will

Phil Nadeau

Vertex’s can maybe the the be thinking will whether at you is to measures you most of to be trial dose recent I taking II that will What that’s determination? remind for my Thanks Phase Hey. you Phase ask question. II/III. portion on II/III about then portion II Phase that by the data Phase the Phase and criteria specifically make from What inaxaplin into which wanted advanced generally, more looking us choose what disclosed? III? And on

Dr. Reshma Kewalramani

Sure. is proteinuria. APOLX-mediated in is the Phil, seen can and program disease That XX really means we change or that’s And AMKD that GFR. within study. period. not the for trial, selection, of proteinuria, II/III inaxaplin VX-XXX adaptive the the really for the possible the criteria is trial in Remember, dose XX-week see, that’s kidney around change centers that efficacy Phil, at measures weeks what Phase

But II about have the milestone gotten that to continuing important careful way, selected, integrity, would make Phase going patients committee decision, will steady dose I that given a that but have portion. the we are to maintaining that that and trial and would -- be that in been has past the data we is the are Phase to we there need the that in be appropriate a can III at are the given assume integrity. is to trial fact Now done the maintain that there that look to share

Phil Nadeau

That’s you. helpful. Thank

Dr. Reshma Kewalramani

Yeah.

Operator

come yes, ahead. come Please The -- Seigerman will next from with will question from go Evan BMO. ma’am,

Evan Seigerman

you I’d to a as so reinitiate this highlight might also for to Hey, question. my congrats than saw with quarter. successful strong for XXX you Can trial taking predecessors? the XXX you Really more asset? what provide more on its me Thank color with clinical some to guys. much why love you be

Dr. Reshma Kewalramani

Good Hey. Evan. Yeah. afternoon,

everyone alpha-X our me AATD question in or this let and take so program. interested And back the antitrypsin why one-half So is on remind step deficiency we are disease.

have a who and Europe the fibrosis. in something like the VERTEX understand bench causal work translates There validated and a and our disease the R&D little biology, be strategy people this a XXX,XXX happens that strategy, biomarker we about our given the It is it cystic fits protein a we disease, AATD by from about human bit in have a of pulmonary way, a are So a know glove. U.S. that misfolding, disease where bedside. also to have we disease to we target is

just So perfectly. this Phase disease that’s with fits trial. What saw why the us VX-XXX II we

reduction multifold, we potent parallel we able put than to potent, are forward taking approach has I and and bring parallel, has When are to together, are. a clearance before. coverage goes AAT taking the levels. in liver was molecule a that because we serum is can longer-term we were tox for demonstrated medicines is been study, in also is, the study, advancing to to than polymer. corrector in these study. we able of study that It’s are to more more more never levels. its XXX. and assess analysis, time, approaches properties, a the we clearance exploratory we molecule it we And XXX That both back polymer raise we in this for This better longer-term chronic small VX-XXX, it That polymer Phase the see also is And XX% functional the in drug-like serum saw. that here’s first initiated where in VX-XXX. all AAT first-generation has Now One have

for and polymer functional AAT. on long-term clearance the looking are we So liver impact

need which We parallel, are time maybe know, data driving we molecules both or I advance further. in will molecule of these this don’t programs next the forward should that we to assess and year, around have

program. where really that’s we are So AATD the with

Evan Seigerman

you. Thank

Susie Lisa

Next please, Chuck?

Operator

from David SVB will ahead. Securities. The go question next Please with come Risinger

David Risinger

results add Thanks let given and much very me the markets. well, congrats particularly as the my on speculation today the in

regarding of be acute context opportunity is the risk question product’s the opioids issue? drugs is, my you. is opportunity have take replace clearly less opioid you chronic and are not DRG your addiction are patients So But the pain in long-term. administered understand at Basically they hospital in week market tremendous help likely preexisting since they of hospitals course, could be patients to and of who the in than my system question a sensitivity? addiction us Thank if that VX-XXX of is unless, cannot prescribed for generic inexpensive a will codes review opioids

Dr. Reshma Kewalramani

tackle a going say acute pain. David, I back Stuart on Stuart? and am pain will question to to word come just the and chronic I on ask

Stuart Arbuckle

Yeah.

for the thanks David. question, Yeah. So

fact of One, very pain opportunity acute this there’s in a market in of today the remarks, treatment hospital for market. said is a that a of fact market concentrated a prepared of market number referenced, much for XX% and as acute So today. terms that year, you sizable treatment very my the billion we is billion see X.X is a as the in significant over do pain, the I referenced the I days the as generic, despite reasons. environment that $X is

and significant. what unmet constraints the a opioid opioids. So substantially very prominent epidemic, well-recognized of your to use and the actually, the contrast unmet need the states use and put In in systems of actually very that that, of and on many as the real a is have very, place need use been to many question here is, is the acute the hospital and contributor opioids is of result there in reduced opioids in has significant comments,

acute pain patients. hasn’t gone However, those to for what severe away is moderate

effects provides significant that without relief, of addictive is for pain in potential other something the there gap so And left effective marketplace side opioids. a and the but

setting, on like substantial four something days, inpatient stay, a think pain discharged ongoing probably average in fill terms and the a is unmet hospital the of there’s So with retail patients management, we multi-day both in need, the then which which are they days, three then, obviously, days, medical two prescription those that, setting. for in

Reshma, about So, And real the to in difference but back overall, of make acute the both treatment chronic. we of VX-XXX, also very, profile opportunity very then pain. the excited a to the are on you

Dr. Reshma Kewalramani

acute of and the VX-XXX use terms efficacy in One the initiate I high pain, second, target, opportunity not on chronic not pain opportunity validation And the also neuropathic to neuropathic addition the will opioids chronic we very sort to chronic we what in setting pain reason opportunity But letting a for diabetic genetic substantial close not wanted molecule in in this in example, period, agree even of period. are in the the is dose-ranging to wanting by in David, a VX-XXX. very pharmacological all opioids just because Yeah. pain. indicated the actually know have for the II Phase of, you of with pain neuropathic two-fold. quarter. that for opioids predecessor chronic over pain. confidence of use this good And validation to you I you the an wanting on not over acute around in frankly, is of but at with And study because one, only

David Risinger

you. Thank

Operator

The Robyn next Please from with come question will ahead. Truist Karnauskas go Securities.

Kripa Devarakonda

about are from what you. you you the way? program another go How in IND you you question move And take to maybe you Hey. acceptance? in can new has AAT earliest given how that Hi. Thank you clinic? doing one really in -- into do Phase think I anticipate Phase thinking trials reason study? any II will to delays mRNA healthy year. think short What’s question. that see previously into do on with volunteer Is will there VX-XXX, you is it is for this had the And trial? talked modality, This that do this on Thank the long the When the program. changed activity, said is can the CF, for do the Robyn. you see my IND I taking a there on you question any going given later Kripa just to for

Dr. Reshma Kewalramani

Sure.

one AAT. in questions separate two there, and about cystic So, then the mRNA about program fibrosis in

mRNA So tackle cystic first. me fibrosis let in

nucleic cell are more have sure grand than eight you years, IND the small we last, product right, And therapies things, we say, have That could is IND-enabling disease So life-shortening The that motivated serious five studies the a for year. X,XXX go small use benefit all and from a acid only inhaled working make in so bring rapidly. years patients to medicines are do don’t is those modulators. and approach therapy that patients complete. been to will a are to very make complex is let’s on of been therapies being working parties cannot who this molecules an And CF protein whereas mRNA said, benefit invested for the to scheme on therefore, any I decades. think or here The it for that and many CFTR CFTR in all molecule.

calls, we be the I I that we with able and see very the in on progress will you go Of the with but IND pleased in are to future progress this am on am update course, track pleased to year. to

evaluate advancing you studying in to two next clearance duration -- in time a in track terms move have we clip, one or VX-XXX that period extended of parallel would to And into a But first-in-human I the to VX-XXX doing and the let’s I this have study; study record, our do things is and On molecules longer have this the tend parallel; mechanism. to fully extended for of so, say you first-in-human have good over because the year clinic. coverage sufficient from time. are data we enter from first period behind I an program, data at think is we our XXX need we doing in around liver we AAT can, toxicology are that this VX-XXX for seen will we to the say, humans, say, with studies we longer expect the will our more Phase II term XXX, two, study and

we are, feel really where strategy portfolio a I but in innovation good are we about on serial and our of executing So particularly approach of all in as and programs, the would having exactly AAT. I like

Kripa Devarakonda

much. so you Thank

Operator

question ahead. JPMorgan. go will Jessica next Fye with come The from Please

Jessica Fye

for Nice there. tonight. my question. results Hey taking Thanks

should with just liver question, second, sure has to are XXX, when XX make we analysis that for expect might triple you drug-like an on end, by and which patients further in in up with of earlier I sort generating Following required? evaluate just polymer the data properties? year clearance factoring XXX And derisk to for data trials up enrollment age longer-term topline time be this then to can you. better complete set expectations you new Thank any understand,

Dr. Reshma Kewalramani

of do that’s plus complete in the project XXX-XXX combination, on combination, before new program, studies that enrollment end triple Yeah. in year. triple the vanzacaftor this XX Jessica, the tezacaftor, both will we

As year these are in studies a duration. reminder, one

results year point with to But and little So the we and bit but dosing that’s of the AATD, With one-year point are time, duration. having we know program quick will XXX regard and pretty complete out trying have thereafter. study of a some we the closing treatment a to take there. the what is really to important it accomplish does are next at all

of functional us AAT. to for that hoc liver XX% molecule for that treatment are in biological to important post thing with clearance we but XXX first functional corrector The of that showed longer-term III, II we small decrease the for clearance because indeed in testing gave what mind. The analysis increases was going a effect to treatment is treatment of term to the XXX, we us leads reason believe Phase study the saw magnitude to elevations keep Phase levels, With proof there the to us lead to is hypothesis That’s evaluate that in longer polymer are insufficient the AAT would want in the polymer level. where us in of a time we also liver. the ever Here’s leading to serum and move activity.

is molecule disease, allows that’s parallel. on to running Ultimately, in potential treat of that both into molecule maybe to take of that that both both that select and If it term possible AATD Is programs more small better assess that’s treatment? moves is approach longer we possible. possible. only possible has approach it’s that’s properties? the drawn these asking, potent a based is of to the forward the and to pathway that you out And Yes, us in the is most have we liver molecule XXX Yes, manifestations this parallel. are drug-like later the those disease important this are thing away this and that holds because the this lung stages VX-XXX why is development it we

Jessica Fye

Thanks.

Operator

ahead. Bank will The from come of Meacham Please question with next America. go Geoff

Unidentified Analyst

the on Should early [ph] be EU that you rough through on you. late the exa-cel. timeline Joe walk in what more is is we the commercial Geoff. for XXXX we This rollout? thinking thinking be and is Can And Hi. Thank eventual the question first filing for should a U.S., had I about us XXXX? or after revenue? how

Dr. Reshma Kewalramani

Sure.

are where the towards prelaunch I going Let and next ask am we milestones to comment me today and the then on working Stuart that with to activities. start are we immediate

intensely U.K. on EU, the are we focused and U.S. for filings So the in getting our the

little Stuart, track our We end want to a and and in of prelaunch activities submission submissions in rolling the on the talk we month to are there? bit the to from EU are November our start for by on about U.S. year. you this next do U.K. track complete

Stuart Arbuckle

Yeah.

and the who focused So with be other ones areas; activities one much one and actually treatment administering payers; payers of is in policymakers is be with prelaunch policymakers. and with would the two who would the is exa-cel our authorized centers

significant right this of that lot conditions as exa-cel a obviously, payer This productive as well to been are imagine, access unmet pending, approval. so that get regulatory making sure so a by is about is of can you that’s As discussions the policymaker in early the have patients can the place and community, recognized possible need having we really disease have and them and with been very fruitful.

On located. close about really of are the patients Italy, side, in are discrete centers, and to concentrated the France, patients XX in treatment patients which Germany. about concentrated. about the in are four the authorized in U.S. relatively is are geographies U.K., treatment And authorized identifying XX% states where of patients it EU, where XX% In the center countries, are here

or positive. something regulatory so of I our onetime centers, to the potential treatment say, of U.S., establish They potential been the And the their excited so clearly to Europe, about exa-cel, which has the in XX are countries very think has we provide in engagement so functional in the we serve majority are or the Again, about here cure approval. those as looking at centers could vast patients. prospect about very XX to pending which a patients, four like with

Unidentified Analyst

so much. you Thank Great.

Susie Lisa

think have please. we more one I time for

Operator

UBS. Colin will Please with go The from Bristow ahead. come next question

Unidentified Analyst

question Yi progress. pipeline the for strong congrats Han on on for and Thanks is Colin. This Hi. [ph] our taking quarter and

two questions. have we So

CF-based The first your business. on is one

is latest And So from how the do AbbVie’s threat tezacaftor clinicaltrials.gov? the on second you appeared triple believe with the DMD CRISPR-based therapy. question the competitive just on

year. already the IND So be will noted you filing next have

we data the done already you have example, could first the patient VX-XXX program diabetes? you would for for the release So think in do with when Thank clinical see program, data for you. the consider, like you single as

Dr. Reshma Kewalramani

on are questions one There and on there, in two one DMD. CF

the take first. DMD me question Let

to give approaches DMD our focus everyone which microdystrophin. little there, than a bit on of backgrounder, out the a most approach is of different recall that So quick to

Our near approach length an centered producing we of and human dystrophin. gene genetics vivo in full exon the is the approach we is if is this because length, skipping that reason believe in full that approach not see. And editing on

have with much Becker’s human a where milder is DMD. of for The really microdystrophin program. have So approach much, kind length near muscular of of behind pleased dystrophin, example, doesn’t form it. dystrophy simply full genetics the that patients progress am that disease I the

We enabling now. are in IND our studies

little our that cell and IND We similar gene patients about where early we going those this up year. bit over when next small program, space, know of we was but file would to to to a CTXXXX, expect finish diabetes X expect to program number reasonable reasonably similar a with you very are data question time, could and of call, a there I amount a too very in are. think There in really the so to type about

bar. about patients times this up enormously have XX% we in an of treat past. the disease. business, It has this high with CF the talked to many set On TRIKAFTA can

TRIKAFTA, that to transport a enrollment TRIKAFTA is is program chloride and II better human the tall order, year. it complete This bronchial than already but if III potential. is have If is program. going possible epithelial vanzacaftor We next the advanced in program. it and Phase studies. be it has It possible to this better -- in It’s Phase holds assays the our triple vanzacaftor than

to CF. it But we even are time therapy on therapy better a patients do with of mRNA than the cross-study like having the And We comparisons. in have first for potentially II Phase is for brink bringing the X,XXX looks it the now some TRIKAFTA. last studies,

patients. had and like never for and been we sharing never cup I having hand forward more being have our position CFTR this data. in more right looking am benefit all We from our have of to the of something on modulators I patients

Operator

Ms. session. I go would over turn closing the This ahead. Please back Susie our Lisa for to like concludes any to conference question-and-answer remarks.

Susie Lisa

with and Thank to you, you We much, look forward thanks meeting questions. for everyone, soon. follow-up very your taking and Chuck, their

Operator

The has conference now today’s for presentation. concluded. attending you Thank

may You disconnect. now

Vertex Pharmaceuticals (VRTX) 28 Oct 222022 Q3 Earnings call transcript