ALXN - Earnings call transcript Q2 2019 | Alexion Pharmaceuticals, Inc.

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Operator

Good morning, and welcome to the Alexion Pharmaceuticals Incorporated Conference Call to discuss Second Quarter 2019 Financial Results. Today's call is being recorded.

For opening remarks and introductions, I would now like to turn the call over to Susan Altschuller, Vice President of Investor Relations. Please go ahead, ma'am.

Susan Altschuller

Thank you, Crystal. you performance us of for thank to today's XXXX. and Alexion's discuss the morning, for on joining call Good second quarter Today's Hantson, led be CEO. call by will our Ludwig Officer; Paul and R&D Goff, our our by Head Officer. Brian joined Commercial be our Global will Chief Ludwig Financial John Chief Orloff, of Clancy,

on that access the our of Events slides presented our this will page website. can You webcast call on section Investor be the by to Relations going

undertake statements be law. point we that discussed factors except statements, making begin, results These will I Please apply that Before of at risk certain could by no uncertainties forward-looking after a the materially. take as update required statements actual forward-looking we to as duty of any these the and out involve our like our additional to statements SEC call, the to and differ look we would filings risks for only detail. and in today, cause

that using in business guidance performance. to, like in our useful understanding release. but included ongoing to our our I we financial press measures, results substitute should non-GAAP and of measures financial information a These for will our provide non-GAAP we remind Reconciliations considered would believe for, which are financial the also you be financial be not of addition GAAP results.

Thank you. Ludwig.

Ludwig Hantson

and Susan, you, everyone. Thank morning, good

financials. far so out and deliver the long-term solidifying building our further great creation for durability base year metabolics made to continuing continuing aHUS PNH value this drive business pipeline to the have in progress neurology on We the and growth of and

of a report start. PNH patients. The of week, U.S. beginning that is of have for And recent I'm highlights X off of launch achievements. XX% to conversion Slide ULTOMIRIS facilitated of as we this PNH the pleased our with strong to some

Xnd, have of launched in we and received ULTOMIRIS already EU July Germany. approval PNH the of in On

least of best-in-class XX% the first have our have two sustainable We of and launch. ambition years remained pricing in global conversion strategy from at a consistent with patients

and atypical date XX, granted aHUS ULTOMIRIS FDA action with by ahead review the initial October priority Our of our expectations. a filing target was accepted of

of in we took step NMOSD, therapy which SOLIRIS first June, U.S. is ever a a NMOSD can SOLIRIS in approved FDA even the the neurology. in disease have for patients. With for approval relapse forward one devastating a in major consequences late

with We hope the year. we in the the are progress U.S. on and by of approvals have to working made already pre-launch EU launch good end and Japan gain the plan where

gMG, expect our With the year-end. the launch from we patient contribution be biggest neurology franchise to volume of in by NMOSD growing and by U.S.

In disease. metabolics, once for growth, delivered Wilson STRENSIQ XXXX again and with year-over-year double-digit KANUMA

an We therapy on-track to remains to next opportunity have year. complete early another trial and by our enrollment to transformative patients bring pivotal

the subcu way Phase is in is ULTOMIRIS gMG. Our under and studies Dosing ULTOMIRIS for pipeline in progressing. III

Zealand deals are working We the year. preparing a the over first to late Caelum, remains three also add are trial we to and the multiple core coming the year: Business Pharma. focus, for that stage organizational completed of initiations Affibody half clinical in development

our EPS delivered positions this performance business. our very we XX% and financial year. XXXX to Finally, as updated the XX% strong well reflects the All momentum non-GAAP remainder growth. very deliver growth of revenue in the with guidance against the of And objectives

areas patients therapeutic to more even to transformative therapies our aligns opportunities for look to bring continue further rare and diseases. with out orders, expand also mission into build We our with core to

quarter discuss Paul. call financial our With over to results. second that, will to I Paul turn the

Paul Clancy

growth year-over-year. Ludwig. in by conversion. ULTOMIRIS Slide increase and Thanks, PNH reported gMG, quarter business an second we $X.XXX core XX% driven This continued with total the X, the Starting of billion, revenues was of

leverage line than XX% of XXX XX% $X.XX, earnings operating non-GAAP expansion planned year-over-year. was was growth expense. the R&D second in representing Our by points, top quarter lower an in per margin driven Non-GAAP basis share

X. Moving to Slide

growth by by to product price Second headwind driven XX% headwind of of net revenue million a the price in offset second were Canada X%. result an $XX was FX X% sales quarter. largely for of reduction quarter our business The volume SOLIRIS in headwind a in of

related in with Canada this is to This SOLIRIS PMPRB Court Review of the judicial May dispute several Canadian our Patented of dismissed Prices application to ongoing for Medicine year, the In or Federal related review. pricing Board our Canada.

decision forward, the per going in the for in a revenue appealing quarter, are We result of we approximately quarter. estimate June reduction the $X XXXX. the impact which a XXXX this from to led will includes headwind While period that to September million

to growth of prior order in U.S., of volume timing the is July ahead impacted million markets year. $X erosion Rest benefited the judicial in $XXX approximately in business. the In in X, holiday year-over-year with Russia revenue was second SOLIRIS million, the which the XX%. was negatively order with from we by by consistent World Slide Turning Xth growth Canada of Revenue quarter

Turning quarter dynamic. in a to the benefit there the loading XX. revenue Slide in second XX% $XX patients year Recall first million. the switch is dose is ULTOMIRIS to was due

expect atypical we those we two CX volume growth and single-digit volume Slide HUS PNH combined aHUS in and the XX, included ULTOMIRIS have the franchise growth solid the of we where saw and underlying XX% On year growth high across in for gMG. quarter indications. year-over-year and SOLIRIS remains PNH, Underlying for

revenue volume growth representing the revenue quarter revenues KANUMA XX% and Moving $XX XX% second $XXX revenues were for quarter the in second to in representing XX, in were Slide year-over-year. XX% growth STRENSIQ growth volume year-over-year. million XX% growth million

to on XX. P&L Slide Turning the

revenues. $XXX non-GAAP for was of quarter, expense R&D XX% million the During

late-stage XXXX, This spend, lower seen we the expense R&D ramp from non-GAAP this program business to we development R&D is up deals so is had due far have Our of phasing significant to than and planned. not we have which expect much we the closed burn year. in

effective was both tax and the non-GAAP non-GAAP of Non-GAAP tax were taxes The claim a our quarter. GAAP $XXX million to ability rate the XX%, tax driven GAAP approximately was revenues. was in SG&A X% rate expense foreign by quarter credit XX% the in or

GAAP of $X.XX. We share marketable growing per earnings second earnings XX% with was year-over-year. non-GAAP quarter quarter approximately securities. $X.XX and cash share second reported in ended the per billion $X.X We

I guidance. will Slide to now our full-year for updated turn financial XX,

between range. guiding XX% $X,XXX to to prior at total an are the represents We million, year-over-year $X,XXX revenues growth the This million increase midpoint from of guidance.

to million. For $X,XXX the revenue combination $X,XXX our is of SOLIRIS guidance and ULTOMIRIS million

for of This NMOSD our quarter. And the FDA now assumes the United continued in ULTOMIRIS recent in in the approval expected gMG launch momentum fourth of includes in U.S. aHUS launch States. of incorporates

estimate both the to the impact sustainability includes STRENSIQ our a KANUMA. for U.S. will in a $XXX item. to based This dosing. pricing support by headwind driven higher to revenue strategic Turning STRENSIQ metabolics, and $XXX Canada guidance weight is XXXX, X% decision be of for pricing million than primarily the price We prior given million in guidance

is and expected impact inclusive exchange well hedging million XX% and expenses related as GAAP of net $XX represent to headwind. is upfront be of margin XX% Foreign operating payments. a as restructuring to expected between

and lower as Non-GAAP XX% operating to now build We into projected to expect increase accelerate into a we margin to spend of pipeline next XX% for R&D XXXX. much has intend year. shifted is and spend is of expected Phasing XX% Non-GAAP XXXX. going the expectations to to be the be of expense percentage further our original than program to revenues, revenue. XX% to dollars both between R&D anticipate it sales late-stage and in of

is SG&A to be Non-GAAP XX% full-year spend expected XXXX. revenues for to of XX%

between between earnings be share and $X.XX range approximately expect non-GAAP non-GAAP XXXX. is in $X.XX and midpoint expected to is to share to GAAP year-over-year. The We be effective of per XX% similar earnings growth $X.XX. per tax expected rate $X.XX this is

well deliver our goals. We financial delivered XXXX have positioned excellent half an first on to in

now over on to an provide the turn will call I to John R&D. update

John Orloff

half R&D Thank you, a in PNH and significant priority the for both disease. rare the want of and the HUS significant first I SOLIRIS in for devastating of Japan accomplishments milestone marking in atypical was the EU therapy the became of recognizing the in FDA United by this for approved review treatment to year. the granted NMOSD States. organization approved ULTOMIRIS Paul. first this start

We ULTOMIRIS as gMG as patients continue and our trial in our to once-weekly well dosing trial. pipeline our advance our subcutaneous pivotal ULTOMIRIS

pipeline added with development business Biosciences peptide CAELXXX the collaboration ABY-XXX and for Light We Anti-FcRn AL therapeutics Caelum a Chain with for and to with three collaboration Biosciences Amyloidosis; deals. novel with and targeting Affibody We announced asset; for our also collaboration Pharma complement. Zealand a

programs On Slide of pillars. see can encompasses which our development breadth development across XX blockbuster four portfolio, you XX, currently our the

We expect programs. and into XXXX the toward as development clinical numerous up ramp back initiate half activity late-stage XXXX of we to trial

are with XXXX. key initiate III us in announcing our This I to like serve to Turning plan some Hematopoietic HSCT-TMA would we Transplant-Associated and programs, nephrology, that hematology Microangiopathy in we Thrombotic to ULTOMIRIS XX, opportunity a late-stage Stem for HSCT-TMA in potentially the or starting plans patients. of Slide Cell today Phase study provides to the highlight

limited have options. very We treatment

subcutaneous study, once-weekly study and III III in strategy able With to is weekly for our of our bridging subcutaneous gMG ULTOMIRIS neurology, offer parallel. with PNH we HUS. a plans and believe atypical be ongoing, patients to we Phase optionality Phase will pursue In with ULTOMIRIS

gain II/III are would ALS, feedback. a to for proof-of-concept early pending to later complement a plan NMOSD the Phase early of ALS. and in a goal year on-track year. of for clinical with next This study the ULTOMIRIS be inhibition We to this a trial initiate pathogenesis We Phase trial initiate role III regulatory in likely

patients Caelum rare in benefit organ II/III Phase a cardiac demonstrated our XXXX function high in mortality. study program the Biosciences. Recall Chain The and a Xa/Xb with renal in proof-of-concept with target rapid in Moving clinical and and initiate vivo. to with early with AL Light progression early to to Phase engagement Amyloidosis, on collaboration failure disease CAEL-XXX, plan

with enrollment XXXX to copper the Phase from XXXX. potential and potentially on-track early differentiated metabolics Disease. current due improving Wilson neuropsychiatric be therapies and improvement has to dosing. XX,XXX-fold for higher to for Turning III affinity complete in We in function symptoms highly a remain trial to significant liver ALXNXXXX our

lead warm the supply seamless XXXX anti-FcRn hemolytic XXXX. in we autoimmune of We Phase our to Finally, year-end. manufacture ALXNXXXX candidate II/III clinical is XXXX to emerging in early on-track plan a portfolio. trial anemia, start In our by operationally sufficient programs remain for

XXXX we a generating healthy evolving data focus gMG, development to in the after volunteers. formulation will subcutaneous have subcutaneous in we and a begin trial XXXX decided In on given our landscape, of

I'm thank global this would R&D in efforts continues our incredibly their made of pipeline strategy. far for as portfolio providing to build. and pipeline I our so forward updates tireless year to and advancing organization like we future proud the progress the to look

will highlights over quarter. Brian. to turn I Brian that, the to the discuss for commercial call With

Brian Goff

our in progress XX to patient the launch I be In have John. efforts made we pleased conversion. facilitate U.S., with Thanks, with to continue we will on ULTOMIRIS. all with very start Slide the the

As patients of OneSource week, were this enrolled on XX% PNH of of treatment in and with the ULTOMIRIS. XX% beginning are

best-in-class achieving patients, States. faster the So only the also on solid path least now important of reach This we profile. strength can XX% mid-XXXX for remain United we toward of our not the a and believe conversion patient that even goal very ULTOMIRIS of at in is goal reflects targeting but clinical

to Earlier where this We in facilitate Germany, relatively in narrow and band global each a ULTOMIRIS approval Europe strategy patients for pricing already to our received a SOLIRIS ambition in conversion price for the Similar we have in is the sustainable we launch already month, U.S.. ULTOMIRIS. established a best-in-class rapid globally have as geography. maintain range begun is for to treating aspire price

June In listing launch. are in we Health we the order in price while National Insurance approval to for waiting Japan, received and

We physician of begin engaged can patients anticipate in actively awareness ULTOMIRIS. improve to are conversion in September. efforts We

significant Turning to growth Slide opportunity. represents a XX, neurology

left, ended years gMG As you are launch. the the in and the the X,XXX with treated less we still into with than see patients U.S. on nearly SOLIRIS we quarter two

gMG can approach serve on spectrum of to you across severity. believe of disease will disease. is Building for see the the a us ULTOMIRIS with gMG patients base goal our right, SOLIRIS, On help portfolio treatment the of our options to expand patients We continuum ALXNXXXX.

upon of build first the recent fear our ever and disease SOLIRIS to SOLIRIS XX, is success devastating in patients expansion which for NMOSD, with a effects are the constant another approved into NMOSD. potentially attack. we therapy gMG Turning to unpredictable the Slide FDA of live excited of in

the trial SOLIRIS reducing on NMOSD relapse. demonstrated Phase a As effect our has III the an on see you can profound that risk of right,

us targeting positions have There teams our We such field overlap well gMG, which neurology medical expanded points year, in as are with synergies and launch. new we centers call excellence. for this MS are but of strong also

the patients, these now place a as as in pleased OneSource we with I'm a NMOSD SOLIRIS. in to already patients urgency number infrastructure treated of open With right well the sense and to serve of first report have cases that

on we STRENSIQ with patients. and our to to increase Moving support of each million Slide CALIPER metabolics aim diagnosis, helping of XX. quarter reported earlier pediatric our ranges awareness to diagnostic the $XXX appropriate second franchise revenue We adoption for adjusted initiative particularly of HPP,

action KANUMA bringing second hope indications. HPP, want for was agreements expanded $XX team packed I now from identify revenue ended seek both thank patients commercial to of in the additional to a great hard quarter plan and suffering new with geographies. work and especially to quarter, their disease patients to and and the dedication million our reimbursement rare with to continue This we LAL-D and

now will for back call comments. Ludwig. Ludwig turn I the to closing

Ludwig Hantson

on so I this building progress XXXX our forward with further pleased very I'm Brian. to far. momentum. look you, Thank

four our leverage strengthen and our continue ways expertise. to look also pillars, disease to in we blockbuster our established unique of we As further each for rare position

strong with growth, our Looking ahead, opportunities our expanded programs. base including and pipeline we have numerous a foundation late-stage exciting portfolio business and for neurology

We on shareholder long-term create value. strategy with executing lives to transform are patient to the and our aim committed

continued always, employees mission our our their thank to I for dedication trust As and we serve the their like to patients in global us. would for

With now that, to the questions. Operator? open we call will

Operator

from [Operator Instructions] question Geoffrey first from SVB comes And Porges our Leerink.

is line open. Your

Geoffrey Porges

price. congratulations Thank Ludwig, progress the you the and I question, all and very big you much the the on guess - the that approvals. share is particularly for of

of good looking new and about pricing, the products commercially You the that pipeline concentration And But for are share flat and are been in the people's trajectories has new price indications. three for executing the reflects yet years. the strongly both probably patents portfolio. concerns and

more things the for about with else think company. value generate do might that you you or you contemplate the that might you as anything have you Is is the assuming sheet? not So also part appeal could just options with potentially shareholders And us which could balance well, that could you update hand? other say can the on much patent is there as of about that, EU there

Ludwig Hantson

we Yeah, in thanks. that. of Geoff. have there, a Thanks But, lot questions for

of awesome where here strategic what we really we our of doing where model you of So this - on ago, we first the a have team an job and think is the look plan a all, years are When executing business plan now, the are in. at in redefines and organization we is. fundamentals strong is the couple were I team

strong. we have growing like And from it's old and ULTOMIRIS are to only which the got new, year-and-a-half ago was we data, that

We to business, by your IP are from SOLIRIS moving some our business respect similar. ULTOMIRIS to questions on with concentration of of

type raise not building to that execute As are IP in are of conversion, ULTOMIRIS have the we or new country-after-country, discussion. become execute we less portfolio to we story. a as to different on questions biosimilars And going conversion the will our Because quarter-after-quarter, those going related story, to is continue to SOLIRIS are related relevant. that

we So far. so I'm really done have pleased with what

are to strategy. going change not We our

we very have strategy. strong a As believe we I said,

our We we one portfolio as well into cash strengthening building innovation. continue which pipeline you have use the two that and through as last our to will toward internal of looking external are innovation internal CTA we through going is in years at first XXXX, as our assets saw

fundamentals. has team strategic said, a we And we our do. we So going are stronger stronger overnight. delivering don't were we plan, on are what company and every very is, this I The quarter getting story think, to change my strong with we

IP, on news With updates. no the new new on respect to Europe, questions is there In no your EPO.

more a is back September PNH come I that ULTOMIRIS make of what use of said, of aHUS. of care X standard standard we strategy, chapter patents. about for and the just composition again, is matter for approved should the So our this to But matter for once and know our beginning of company care to

organization. So for and the this biosimilars IP topic will become relevant less of

question. if I'm your hope to you anything want at to that. that colleagues I to my So answers add further looking see

Paul Clancy

said. Well No.

Geoffrey Porges

Ludwig. Thanks, Okay.

Ludwig Hantson

Thanks, Geoff.

Operator

you. Thank

from Our next Morgan Matthew question comes from Harrison Stanley.

Your open. line is

Matthew Harrison

and us of been have wondering the quarter you at last I focus morning, pushing especially thanks Thanks. than update those out could on looks to bit was if related talked the ask about a some those you you so. question. to the to I the R&D it I a you just for couple Good around could, those? timelines manufacturing issues what on about guess have that and like the been and and then if programs I studies through now later are and if wanted timeline related taking able the drivers Great. starting of had had FcRn, work

John Orloff

Matt. Thanks, we that identified have and what runs basically an have new we new what that John. what And communicated manufacturing in end by will Actually we drug the now. change relative the year. process product to last we of We addressed drug This quarter. have the no is impurity we said deliver is run substance

to December, will allows product restart program the be in drug delivered by us So which January.

we with is that So what consistent said.

We do operations hemolytic design Phase the with into formulation. with anemia go IV II/III plan a to back seamless

are of with for a be us We will also to fourth also pursuing subcu at drug concentration start that delivered the quarter product volunteers. healthy dosing end the higher formulation

in in to the And I as subcu my Myasthenia at committed looking Gravis with are with SOLIRIS. clearly gone formulation great product gMG we landscape then, I prepared severe that We have that during comments, Gravis. as say to that we Myasthenia will in And recognizing opportunity well indicated evolving severe take patients with space. are

further move goal FcRn, we patient then a conducting not less in have upstream Gravis failure shots few And ULTOMIRIS patients. on here. the with require that to does so We an severe now in are journey IST, our trial Myasthenia of with the

MAD, all as and ABY-XXX will dosing span X well spectrum have as that as with of now us the give is patients Myasthenia opportunity to Gravis. our Phase XXXX in SAD the We

Operator

you. Thank

Raymond from Jaffray. Piper next from Our question comes Chris

open. is line Your

Chris Raymond

Hi. Thanks.

R&D question, guess. I another Just

Just a on really could little ALXNXXXX. one, if just. you is talk I going with bit about wonder what

you I you XXXX. of description now as the about a planning read last in looks in I the X And slide you about completing think are asset. strategic even think But talking study. I like talked launch potential midst quarter that a Phase for a had

going some or what So something else is with with on subcu Thanks. is are by driven seeing XXXX? there this you ULTOMIRIS

Ludwig Hantson

as So, have ULTOMIRIS XX% bioavailability study which us the XX%, at us healthy that the you to from allowed for XXXX every volunteer know, increase XXXX weeks. to two we for gives completed dose which to is options

are seven at patient now now looking that PNH We and total rapidly patient those the populations our here popular ULTOMIRIS - fact in well. very is HUS, options given new it's indications - to expanding serving that with atypical

reach program expand have enrolling a pursuing have we the we subcu in that parallel, indications In other out XXXX, to that business gets when patients it that now with strategy And our bridging that formulation we a subQ market. in weekly to optionality once allow for is are core ULTOMIRIS. will and to

in we So potential go and portfolio horizons. indications options exploring include into go to that XXXX new regard are into as to CX our XXXX right with the have now now we well as alternative

Chris Raymond

you. Thank

Operator

Credit question Auster Suisse. comes Thank from our you. And from next Martin

Your line is open.

Martin Auster

Congrats was so of Canada lower taking point had used then just thanks by I the could price where countries on pricing prices operating the it presents decision. on that the strong continued that SOLIRIS? pricing risks does results. you by evaluating I or curious as have be a creates competitor - the Canada a as other any a question. lowering are follow-up guys, Hey, on for near-term

then the in band is? articulate currently risks could repricing pricing curious international SOLIRIS countries wondering So I if pricing trigger then SOLIRIS. band more you similar tighter just with near-term a have And around you for was what or do secondly, And international SOLIRIS? on other precisely Thanks. that ULTOMIRIS, expect vendor you potentially when would relatively

Paul Clancy

Canada it's for noted, I back to goes We disclosure had Paul. is it's question. our period. Thanks This since the that kind believe XXXX, legal situation Martin. of been The appropriate time Alright, what involved foreign to forth. - with so relates issue It core the issue. to comparison on gets and relates and is actually the localized it so rates exchange pretty as and what

the be this bit we we being, appealing are but localized the of - issue balance of time year. a it, little But local for it's do Brian? will a kind through march there at a headwind of believe point, as We the it's

Brian Goff

on SOLIRIS band. just And the pricing the second about Yeah. question

global We the it haven't global on mean, market what think quantified pricing that, ours. narrow pharmaceutical who as relative most footprint I to really terms we a qualitatively we I And in other have have know but of is products that described a band. similar to relatively

steps with and ULTOMIRIS most So is have the toward already taken ambition we and with the Germany launch big this of the that then ULTOMIRIS. we U.S., recently have, in in

want pricing We have to similar range. maintained a

U.S. in to specific So is just like, pricing looks that be to it the what about similar the Germany, in

And there they fees, versus ULTOMIRIS Germany have the these view longer-term two. is at discount years way, together patients so maintenance of The looks of SOLIRIS. more and a in of about one kind blend a is XX% they

take you SOLIRIS. you with is there average versus maintenance into beyond. when parity then And and essential And ULTOMIRIS get when that

system the the savings is range capture pricing that globally. and have our ambition to discount that You of

Ludwig Hantson

international as to part government of XXXX add this. Yeah, to SOLIRIS published pricing a The end of and going review.com I'm this.

have So said seen U.S. in SOLIRIS not is price this what that it already that different maybe that see going is Internationally. document. document. is And from a But maybe price our much are you you good the to the reference

Martin Auster

Thanks. Appreciate That it. helpful is color. very

Paul Clancy

Okay.

You bet.

Ludwig Hantson

Take question. the next

Operator

you. Thank

Matteis from Our next question Paul comes from Stifel.

open. is line Your

Nate Tower

for is for Maybe taking the question. Thanks Nate question one Brian. for This on Hi. Paul.

restricting Thanks. this, think use refractory or this is being population? And far. almost taps think So term. to X,XXX b, to patients is you have got reticent lesser of how is gMG. What that, be and on a, two: do book the Is SOLIRIS upside physicians by gMG persistent use going Well, in longer then just you I in payers that I SOLIRIS. you so do mean, guess a

Paul Clancy

making. Sure. progress really the with are that are we we Well, pleased

numbers. years So the and we consistent into been launch we very nearly reporting have two are

progress So continue see patients you the whether we see make what guys and or can stakeholders, payers. exactly all to with we physicians, it's

we where in Phase study end III quantify the picture the at population, which nearly And that now just is refractory suggests about our X,XXX, number really the Just bigger achieved noted, we small which that of you to but with there bigger regain still to as U.S. a X,XXX aligns opportunity have pivotal are of is picture, the high in is gMG, pretty patients. there go. plenty were in

I think of most importantly, as that in in both terms for breadth those we important this our all launches of journey. how we and to of prescribing really the clinically, of components of at as steady and measures. It's deliver as are continue that continues prescribing well both particularly by well on see clear reflected stage that launch growth depth SOLIRIS as

this is does their physician reinforces level, at So advocacy this what the to payers.

strengthen of payer reinforcing case. So physician continuity that therapy delivery of require has clinical that the documentation form to some to SOLIRIS for if the is and only were a come back offered

is is as for And the would continue where that, as communication and we reach NMOSD add growth budgets of in I important they that then gMG the their out well proactively payer to are going combination the with we that proactive steady both to of payers creates to payers and set elements perspective as forward. one from predictability now most that a

So about really we feel progress. good the

Operator

you. Thank

from and Nadeau Phil Company. Cowen Our comes question from next

open. is line Your

Phil Nadeau

progress. my Good taking for morning, congrats question on and the thanks

the Just situations. European around patent a couple

correct, September two Xth the have will wait ruling is day. that patents ruling issue what Board September the, correspondence. understanding written be is correct? on Is on position is some to Xth announce on you on we that it Our will for And if that Alexion to a in or the a the

that in And biosimilars successfully Is they then patents you that of impact the the price sensitive have SOLIRIS European of is do or sensitive discounted of don't not issued, situation that in some to pricing Europe if of hear impact ULTOMIRIS the you think and there countries? we Thanks. would biosimilar concern? pricing price launch chance the should What continue and could on second, just compress but broadly a European that would concern countries? price in SOLIRIS, utilization ULTOMIRIS get deeply utilization those

Ludwig Hantson

Yeah.

So noted is EPO a we at a it respect And yes, that so which of written composition is the updates of correct after. think the we September new the the applications with and to about the U.S., Xth, no come hearing, there. decision soon this to is completion And two of would hearing, of the patent matter. expect hearing. the But know hearing at closed outcome of completion is outcome

for And it will situation, be this on with same day. respect the couple what So to European means the a things. of

of appeal ongoing. as and patent know, the you First granted, we formulation an have all, we have process

to to that, stick that means us next So is going that after patent with that three five years, is one. Number

as And aHUS. knowledge. a will which And make I the of for care feel years from of convert three have think to Number lot We of is our and of ULTOMIRIS. to care second-generation, The care those or standard care we think, Germany, approved three now. so said the for ULTOMIRIS time approval to - can case scenarios and timelines the And conversion the I PNH. with a do best biosimilars we redefine next upgrade once our to is for standard have in we in standard strategy two years. best standard is, business is the of a enough we launch of

of market and molecules - two where I'm a interchange and are lot moving aware of a respect a not is these different biosimilars SOLIRIS, Which ability branded ULTOMIRIS to into in product.

in in can distinct so So dynamics. This send Europe them learn, launches that, in if I the you of but two have countries. market I'm will in Europe, be and molecules over these two of distinct pricing biosimilar each older please thinking market analogs dynamics

So here. I'm looking at Brian

Brian Goff

comes now stick seen repeated that have if conversion. from you have experience who we in have imagine years I only with and have you and by had that facilitated that, that that monthly harder timeframe Yeah, the ULTOMIRIS, ambition in with play already harder the infusions would to that we U.S. that, out add patients to just three patient It gets the

would that imagine be patients would therapy. or to hard biweekly the take backwards a then to It's physicians go step back to to those motivated

that a deliver prospect on the the we that continue less the our the more So is position biosimilar to in better facilitated of conversion, relevant becomes. off

Ludwig Hantson

conversion. every a Yeah, much have are better We we the we situation approval. the starting I quarter now, in think since with

We have the and Europe. in good uptick do in we hope to same U.S.

care HUS Next discussion PNH and the being three believe we have do and IP can is opportunity make aHUS, lot I the And there do point. and we in that for standard to redefine of a good years. really

So we will next take question.

Operator

you. Thank

comes next Our Kennen from RBC. from question MacKay

Your line is open.

Kennen MacKay

here might on be if just SOLIRIS but so broaden inhibitors or mandate investors cash the might taking the my for would complement going brought there dividend. decision is trial really you or here thrombotic color follow-up very us on decision a know some on premyopically investing thinking there The up behind given has wondering just already be focused microangiopathy a to any to question. off-label a And was Thanks help or appreciated? for one base I biotech I if in maybe in the this it Hey, they of for previously. some trial run the some John is story, there much. was from other this which any there use starting growth, could potential the small is return. on if perhaps for was looks HSCT-TMA. give from be is? Maybe me Isn't Orloff. wondering dynamics thanks shareholder could around precluded the hugely I based peers issuing, but understand interested competitive Ludwig with strategy,

John Orloff

one. start I will with So first

is this are currently treatment we looking have devastating a opportunity really any options. a I severe and significant in at disease doesn't new that think

excluded may atypical As the from you know, program, complement transplants of actually HSCT-TMA many HUS have even XX,XXX U.S. was patients our though patients There annually. are underlying such approximately dysfunction. undergoing in these

reductions the SOLIRIS experience severe this and survival. population and those and Jodele considered - that those about of related TMA XX% to SOLIRIS of event, in to actually in others shown half have series, TMA XX% in case dysregulation published alluded in improvement you a benefit are with of improvement complement and of mortality, to

year rate year. and In had over fact, mortality survival XX% paper, they XX% a is after that about in one at the

there ULTOMIRIS. we and yet So that it's a big an indication believe real and is to of understand a another mechanism action opportunity reason here for have impact the to

Paul Clancy

Kennen. - Hey, allocation point I is It strategic is been that, that be pipeline, grab think we this capital building - is so we the have priority Paul. about will is question. clear the or our strategy This at tried very, I very to time. have priority in our deployment,

generation of are we on potentially a the We capital possibly company, so flow and capital obviously could kind note, the in shareholders. to cash years that of broad allocation working return few

volatility the the repurchases think particularly would is in the sector preferred if get way that, it, I that point with for about be time, that. the share in think doing to we we avenue

So this is horizon. the at point, dividends not on

Ludwig Hantson

work on Yeah. pipeline. to the have We still do

our So that main point. is this focus at

We will take question. next

Operator

from Our from Mohit next question Bansal comes Citi.

is line your that check mute. Please open. is on line Your

Mohit Bansal

Maybe responders What progress. to understand, conversion. the Is is all market? on possible PNH I'm congrats XX% to beyond the and it switchers even or that early coming from or optimal are for question question, SOLIRIS? of that? early end characterize my of you then on previous from more trying taking it XX% XX% to the on to responders challenges who one bucket going forward, the quick for these adopters the what feel do in from you. you Thank And are Thanks Sorry. number spectrum or on one move the

Brian Goff

questions. lot. Thanks a any dominant is so isn't say patient Yeah. we it the that there Hi, really would conversions, call conversion. Brian. in for phenotype seen have what one This I from far Mohit. Good

and One launches. the rare be, case of in frequency more It's is seems often visit. patient to disease factors early the this of the prominent

the So other opportunities if six clinician month patient every with conversion more every are to month seeing is on months, there obviously, their clinician. a or every discussion have once versus

more think, motivated also center switch. their point live and infusion very to this distance practical is patients not some surprisingly a who We would away that be from

on to across of as same XX% XX%, your question patient wider where of community. be overall, and from the the we it's So go becomes to going continued education do more journey get part a clinician to the the prominent

payers. made good continue, Those the we commercial visits with have really progress patient will

It's we far. really XX% timelines through covered We the don't resistance about of so in made and and are now clinicians. moving that the on hear lives those have place policy more a over we defined from level progress any have any

Ludwig Hantson

Next question?

Operator

Thank you.

from Our Steven Seedhouse next James. question comes Raymond from

Your open. line is

Steven Seedhouse

new versus What impact be as you. implemented Thank versus morning. for drug Senate do you as different patients it can on What the the PNH plan Good Alexion? written? mix is at you is pricing Thank you. say, if appreciably the to U.S. ULTOMIRIS. Committee current would aHUS. assess And financing were insurance reform in SOLIRIS and least gMG law And

Ludwig Hantson

with and couple start will just things. I So of your a later,

we you concrete, is is is going As overall, our to follow exposure believe But limited. potential so happen. what know, we really will nothing

through topics me couple Let go here. a of

all, our about for is this business business, XX% And our a small business. Medicare our Medicare part our U.S. Medicare of our of which XX% of global Part small a is of of part same total First you relatively true know, U.S. is as business. business, global very D

The second price that is how that, drive highlight or to our business. really from model. increases away - price increases is CPI and our above that stayed We point not is I we want our not business

true is innovation and excess an volume. Our and direct business

pricing Then that, point transparency model. internationally we not well call is in with we business strategy, our pricing strategy, our respect SOLIRIS forward. Brian and narrow last band could rebates is are global pricing have, it ULTOMIRIS know, respect, to really addressed as you a trying you but so And our for a we maybe want business price to moving have to the have the I pricing we that make model, sustainable already for band as as

to hope frame helps I So that you opposition.

Brian Goff

just is will This I Maybe Brian. add.

continue PNH we it's So give when navigate way, to ahead. XX% payers the the largest engagements determinations. Medicare of launches for each progress, in those commercial But the is not the us points, go it's case the example is now we ULTOMIRIS the to There made of about predictability think especially policy under you portion in a through that about or I U.S. important material payers. really commercial a chance And those gives for indications. with outlook the but us what live why difference one us across for in multiple that the and

the biggest part of the commercial So really story. is

Ludwig Hantson

Okay. two questions. We take more

Operator

Thank you.

from from comes Salveen question next Goldman Richter Our Sachs.

Your line is open.

Salveen Richter

Thanks expectations oral at for taking then my your secondly, for follow-up the questions. EU you frame when Phil's into SOLIRIS look Can a this hearing? And And question. on just we us IP expect that to Europe do a I do more and you follow we to cadence points in NMO, have this launch gMG in touch seen for the here? even though similar launch U.S. recognize

Ludwig Hantson

EPO do and to Brian there much more will With Yeah. respect second question. can not the the I say. is EPO,

here. that believe we we have So case strong a

patent I the As not SOLIRIS. strategy have is formulation about we overall again said, our but

Our about of overall we care. me that It moving will are strategy making the is standard build quarter-from-quarter, to is moving.

we So launching. the note approval. is have Germany

Germany other have countries year. the this We will in that launch later join

So pretty we believe question. that your second to With we good are in here. a spot respect

Brian Goff

meaningful, motivating important of the often the these just It to the characterize the end it's really for given The that high the an - in of it for us. is world And first we the launch these with treatment And very fear and opportunity. is devastating to living is FDA NMOSD, this then in the respect at cite a who growth opportunity. fact were in are about excited unknowns attacks approved option gMG, impacts Sure. spectrum. refractory patients of we

about study U.S. the III were patients. about the the U.S. pivotal X, is NMOSD in and Regain X,XXX XXX in patients it to to criteria X,XXX Phase aligns that There dimensionalize with

almost Hopefully gMG we of some with of opportunity. different that there we with a dynamics two as amortize commercializing NMOSD the of the that experience well, I say half frame-up have So neurology years have been NMOSD. as a to that lot into but would respect gMG that roughly market sort U.S. helps refractory population. we gained in are the

that FDA a for to use, physicians sense like sense, stability that, is use of example the of is approved that a One have their with from so false is believe had tax. Rituxan, something we nothing created that

stable educational every matters aspects And so false attack sense through working is of we of security. are that really a and

underlying that branded there the prouder horizon that also one set have none the know competition complement of is high and And is pathophysiology core a the that NMOSD. on near-term with of could potential the on study, we not SOLIRIS of the second address of we be bar competitors Prevent horizon. the the We very part

expect We neurology rather as bolus. with dynamics. the a seen are have of a We do linear those So more couple of expect don't a uptake we launch.

Ludwig Hantson

Okay.

one take we question. So more

Operator

from Oppenheimer. Thank you. final from Hartaj And Singh comes our question

Your line is open.

Justin Kim

thanks Kim little total could a for the This patient many the And morning. on if SOLIRIS, to the just patients is you I of wanted X,XXX context how goal Good Hartaj. on for of speak question. ULTOMIRIS in Justin are see by the to year-end?

Brian Goff

Brian, Justin. is this Yes,

So, thanks question. for the

and to specifically. We spot. you landing we walk think But haven't numbers those broken down enough the that around the I right numbers have get given can

that our until to beyond important of from SOLIRIS back prior is middle and noted up when what And launch is, year-end. PNH you to comments XXXX, have we So XXXX. patients X,XXX back part is as made the about get ambition or again on by to the in reflect of

indications the in years, that PNH And achieved on X.X atypical patients had X double that, subsequent have X,XXX years, we base of the therapy about We to will HUS. is and that and roughly number.

a of velocity of in neurology you of the change So the the meaningfulness business. that gives sense in

now we of course, over U.S. the then PNH to of are And ULTOMIRIS. inside in that, patients actively converting the

near about on are we that the journey. excited PDUFA then approval thrilled We or HUS path. early to will continue on And that achieved term neurology the going upon SOLIRIS atypical date for get

color to that hopefully numbers. So the dimensionalize enough you gives

Ludwig Hantson

Thanks, everybody. again,

what far Alexion with team. pleased really of really, have I'm so mentioned, this I really proud accomplished we I'm And the year. As

your to of So my today. all everyone time for and thanks colleagues, thank to big a you

much. so thanks So,

Operator

does thank the gentlemen and ladies Well participating conclude This in you conference. program. today’s for

disconnect. all wonderful day. have Everyone may You a

Alexion Pharmaceuticals (ALXN) 24 Jul 192019 Q2 Earnings call transcript