FGEN - Earnings call transcript Q4 2021

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Operator

Good day, and thank you for standing by and welcome to the FibroGen Fourth Quarter 2021 Financial Results Conference Call. [Operator Instructions] Please be advised that this call is being recorded. [Operator Instructions] I would now like to hand the conference over to your host today, Mike Tung, Vice President of Corporate Strategy and Investor Relations.

You may begin.

Michael Tung

Thank you, Jason, good afternoon everyone. President Strategy Vice at Investor Tung, FibroGen. Michael of and Corporate Relations I'm

call initiation, future today's to subject Vice Conterno, Enrique www.fibrogen.com. Juan, call open most other reporting SEC, today's that does remarks our Chief the prepared other can call clinical Commercial update can Senior call to results FibroGen a Juan the events potential are operations, Officer; I for financial conduct be with remarks Chris risks AstraZeneca FibroGen. a but to me that, including you these Q&A. The the our Form after and activities, Operations. found at strategies like Hunter, related whether Form material call statements A Joining on release business our and And today's will Investors statement and and in forward-looking Officer; limited filings statement. Scientific materially and like CEO. China description I Enrique Such of from FibroGen's of with Financial financial enrollment, complete Dr. website from today's Chung, results trials, call and results, regulatory and results and be to of remind result Eisner, publicly that our Thane collaborations matters. Chief update of on our Chief Chief Dr. found the our not our differ over turn may our research Medical Conterno, our Enrique? The commercial include, and of Officer; more regulatory which development to Graham, XX-K Officer; guidance, could events John of to risks would includes certain the up we would Mark not FibroGen's and are our made section on Executive conference in about XX-Q. Wettig, our statements our recent forward-looking that Enrique results design, Each is Officer; undertake President format include our to, any for with and Astellas, cause obligation statements, risks forward-looking webcast press actual and to uncertainties as business results those of projected otherwise. information, or business and new any and Chief

Enrique Conterno

good. to begin everyone, Disease our earnings full Very quarter you, pamrevlumab programs to highlight to given like and our is and MDS roxadustat XXXX Thank our especially Phase today III I afternoon, year would is that we us and relevant good before Briefly, Mike, fourth which Rare and welcome program. call. Day,

XXXX, pamrevlumab Number in we're the X unmet advance with create development indications: pipeline productivity performance Europe two, roxadustat of we novel our areas trials immuno-oncology three, expertise opportunities. and U.S. our in leverage innovation financials. in developments for accessing success your forward increasing and of expand to call disease kidney patients pancreatic advanced After and need, will autoimmune with number programs with indications research path up to advance beginning call, the then idiopathic to today's Graham, is Slide and FibroGen excited strong roxadustat with our continue and continue questions. extra pamrevlumab. our recent about cancer chronic Phase clinical and locally commercial key will enter internal research which, I fibrosis, significant roxadustat explore we the by ensuring of the on to And outside significant future muscular portfolio the cover for patients space. U.S. On three intend in while our As positioned unresectable dystrophy. III pamrevlumab additional Duchenne Juan with Starting value medical and China, executing in X. shareholders pulmonary development focus, our the as for accelerating one, a in to continuing number three in of our launch review CFO, events, we open that

move locally to pamrevlumab announced pancreatic of in cancer. a clinical LAPIS X. Let's Today, Phase and of on indications, III patients asset our trials on trials X study Phase Slide said, IPF, owned highly LAPC III important our of enrollment advanced wholly DMD. focusing unresectable completion XXX is Pamrevlumab with clinical we for we as

enrollment also XX of approximately with we of III to patients enrollment completed weeks, the the of with few DMD. complete ZEPHYRUS-X LELANTOS-X Phase patients study of III We expect study next IPF. Phase non-ambulatory the In XXX

Our a meaningful largely constitute demonstrated unmet an PRAISE these decline. II function ZEPHYRUS which need is diseases on study based reduction and opportunity. Phase represents study, important they of Phase market III a lung medical Each collectively significant of our

revenue data spend with by a these pamrevlumab multiple comprising year. the on Japan, LAPC on market the characterized beginning size, desire X. perspective With highlighting readouts U.S., in and and therapies challenging across of interim IPF unmet the for of significant progression two we states, with XXX,XXX remains EU, therapies tolerability. disease limitations There options. therapeutic disease like community I'd to X patients additional a and IPF the see expect generated significant diagnosed minutes continued We the with a over approved approximately few in as need pamrevlumab the IPF a $X an XXXX. each key of sentiment current analysis Despite in medicines this with Slide billion market later opportunity is there three net XXXX the in in this our and of China prevalence

a advantage reduces and approved, be and if Phase potential of significant this with is III we number very positioned number late-stage pamrevlumab take for has we PRAISE ZEPHYRUS products the FibroGen. a limited to product sizable of to well If II believe Phase patients the comparable pamrevlumab, the the to opportunity. development, results Given believe help trial, IPF of program

in setting the benefits opportunity opportunity. one disease-free can major advances of with standard failing represents been last with around patients the demonstrate cancer, low cancer IPF, treatment meaningful Turning now unmet two in we Non-metastatic a an the there's non-metastatic rate pancreatic to limited care. which have survival. improvement current XX%. therapies over missing survival of pancreatic survival XXX,XXX locally to combined greatest of late-stage prevalence diagnosed Similar given Slide if X-year regions activity the of the over pancreatic demonstrate advanced X creates and overall There decades, to a in oncology, non-metastatic for pamrevlumab across cancer limited the almost development the

enrolled, pamrevlumab could provide Phase forward important to if the earlier, patients. said is and new we seeing look As LAPIS III we option for an treatment fully trial

Turning snapshot the to pamrevlumab section opportunity. DMD Slide X. with a We the wrap up of

the by progression, community. the we're corticosteroids and program of clinical the to so effects the of relentless can disease deal Given loss they and With the nature devastating is side trial experience hopeful lead as to as current an DMD progression LELANTOS commonly that of needed disease that patients troublesome care, approved ambulation. DMD continue standard therapy with

can We antifibrotic targeting therapies While There's the and the of in the currently be DMD increase function target DMD. and ambulation of changes by approved pamrevlumab small a need exon-skipping families. prolonged these help a only their mechanism muscle therapies produce patients. may a can believe patients pathological downstream improve of that for they solution dystrophin clearly that an proportion levels,

to move on roxadustat let's Slide X. Now

an of the associated EVRENZO has and the positive. symptomatic disease, in with has health feedback early Commission with the Following kidney providers from The United Netherlands, is been first-mover Kingdom, important to Europe in Germany, the opportunity of launched EVRENZO European for EVRENZO relative chronic patients approval care countries. has other The Astellas and prescribing treatment advantage adult now of CKD Nordic anemia the HIF-PHIs. Austria significant, anemia

next the steps. the are on in we forward to next path anemia working those AstraZeneca AstraZeneca, At partner, and met Regarding and this committee we our and discussions In meeting. a together FDA CKD. steps with following with U.S., advisory Roxadustat time, potential the AstraZeneca determine are November, FibroGen in discussed in

China. Moving now to

fourth As roxadustat X, see over quarter. are $XX.X of XXXX XXXX. can we roxadustat to $XX to sales net was the total significant The million distributors in Slide China in sales for in million, growth reporting on million China $XXX.X total distributor you for the net

detail price as portion of FibroGen's NRDL roxadustat roxadustat full revenue quarter the the renewal, $X.X the of in for fourth net year XXXX listing net XXXX finance product further for channel the GAAP a onetime reduction the the adjustment reflected driven basis. for was the update. U.S. inventory. associated in fourth of with China As by million dive of quarter into sales million result deeper revaluation $XX.X a Juan a will on and

launch efforts the to of of be and is see right the primary a hospital. broad have three segments focus roxadustat has of China. Since in been in our hospital to the and see to commercialization to We XXXX, hemodialysis, non-dialysis which mid listings, particular prescribed across performance secure of strong continued a continued roxadustat to peritoneal dialysis adoption

of XX% XXXX, listed included end in the XXXX Roxadustat meaningful anemia hospitals price. the in reduction in that with the approximately was NRDL represent of As we're of CKD market. addressable a

full do we roxadustat by for the expect growth significant However, in net sales year volume. in growth China driven

expansion majority is the capturing months growth Slide expanding the on market. over December XX in XX, of drive to share captured category XXXX the continues As category can period the of anemia you XXXX. in large of the roxadustat Roxadustat see and CKD same an for the ended

that is roxadustat I CKD XX, number look roxadustat of treating of we over our currently only branded CKD updated quarter keeping to anemia now long-term advance making value in the the achieving the Juan We the share for most the of patients. will treatment China's Slide Graham the of HIF-PHI turn that goal and you a recent in segment past CFO, in our anemia care on one the shown financial Juan? standard ESA call as in market. roxadustat to months, update. as China the XX forward of products Finally, for for within all includes XX%

Juan Graham

Thank you, Enrique.

due While about pamrevlumab of progress advanced the XXXX recruitment such our the to cancer a pulmonary for year clinical I'm Duchenne suffering as difficult represents CRL the team. fibrosis, muscular positive inspired and outcome, about opportunity made from patients pamrevlumab by dystrophy. idiopathic optimistic and pancreatic resilience III and trial was on diseases locally potential our the Phase energy I'm

are therapeutic I'm to positioned and to the a diseases, with in we medicines attractive to well deliver bringing to providing for for a opportunity future very significant commercial vision of FibroGen. on confident also diseases option need. addition these unmet presents innovative patients In our patients pamrevlumab

into diving financials. our Now

year to same versus period Total for for fourth in to compared revenue XXXX. the As we million grew the quarter $XX as full today, in XX.X% by million $XXX.X for was $XX.X million revenue announced XXXX XXXX. $XXX.X million

X and deeper performance a we As reminder, revenue as our revenue. into we go of record sources

being of probably which from earned allocated payments license First, is deemed in revenue, the and earned period. license milestones or

which revenue, development expense from Second,, development from and other revenue activities. development reimbursement is revenue

well product is and net Third, the by our commercial-grade recognize transfer to for as from which the drug sales FibroGen jointly which fourth, from product JDE revenue, from direct API China to sales or or product AstraZeneca to distributors. And distribution price we shipments our them. revenue payments the price which in drug partners as transfer owned includes entity collaboration our revenue bulk

revenue During development for our in the fourth codevelopment quarter, efforts with agreements we collaboration roxadustat. associated recorded million $XX from

roxadustat a updated revenue have reflected roxadustat to fourth $X.X in roxadustat million important the NRDL, results During onetime in It net the direct This to total compared net quarter, JDE made NRDL net million we that due the FibroGen total quarter quarter. renewal, quarter that sales our sales which China, on we FibroGen is total note net to distributors. context JDE important distributors operating It sales quarter to our for fourth to is $X.X adjustment, our estimates the reflect million, Despite through roxadustat and sales inventory XXXX. downward direct fourth the China fourth distributors. recorded of renewal, includes Providing of for sales began grew sales product from a our $X.X to $XX.X sales business the roxadustat and includes based our million in its for with of the adjustment. $XX revenue to this XX% the in in revaluation and listing sales China. to by cumulative we note million listing adjustment

profit the these the on of for portion and have for first paying sales the FibroGen roxadustat XXXX, FibroGen the items. was China distributors share. selling we Focusing efforts in began and commercialization to quarter AstraZeneca's as starting disclosed, to Previously, previously AstraZeneca's of JDE JDE, responsible

price fourth As per quarter. with was FibroGen recorded agreement the net for the this JDE, to AstraZeneca, $XX.X a million from transfer which sales

deferred revenue XX% range recognized net distributors. $X.X is $X.X roxadustat transfer deferral, the to After price, this future the XX% lies will periods. guided, net sales the be quarter in JDE previously to in the its JDE. this of for net million transfer have to this we within As and sales recorded price From million net from FibroGen roxadustat

be encouraged of with penetration our operations in market to strong continue NRDL by We growth contract continued China XXXX and and beyond. the our expect we renewed

we drug not the have For quarter, license significant. not and did product was revenue revenue

three, wrap representing period, revenue we and roxadustat. to XX% more texture represents due to from substantial Phase sales for of to distribution As development a transitioning to revenue joint major due fourth model, payment order to revenue due onetime the up nearly direct sales of versus in entity which of distributor lower completion the quarter of revenue, FibroGen the the lower Two, magnitude are: FibroGen's One, change, lower change. with the III providing year XXXX, license milestone change China product in revenue drivers XX% roughly variance to the prior trials in the to

down moving to Now the income statement.

associated fourth an to a bio the the R&D pamrevlumab $XXX drug by III HIF-PHI Phase change trials, driven in operating million expenses supply our increase drivers and were compared costs million ago. primary clinical are costs year The programs of During license. including $XXX.X quarter, the costs and with

December $XXX.X for we last quarter, loss and $X.XX diluted cash During accounts as basic loss net reported or $XX.X receivable. At XX, quarter million investments year. million was basic for of million $XXX.X compared to $X.XX net in fourth per loss fourth and the shares cash, shares diluted and the equivalents, or both net

As million range to forward, equivalents, the balance receivable cash XXXX million. our accounts be of we $XXX ending estimate look we and of cash, in investments $XXX to

to While position array balance financed, would we Enrique. lead cash we are I call consider are would that to like with you. turn to our evaluate of a and to options continue back over opportunities appropriately we to now sheet. wide Thank strengthening as the And our privileged

Enrique Conterno

are In to closing, three III and fibrosis, Duchenne development Idiopathic forward and perform potential as Roxadustat well in geographies. we roxadustat in under in China, a to our need. partner of muscular pancreatic our commercialization locally moving partner steps advanced Astellas indications in discussions we and medical unresectable in pamrevlumab dystrophy. Phase remain very submissions committed review is unmet multiple determine have FibroGen advancing with to regulatory continues Europe medicines first-in-class with other U.S. significant pulmonary in AstraZeneca next the cancer in

in on a shown $XXX financial As Slide XX, have we million $XXX to position $XXX strong continue to approximately cash. in with end and to million expect cash XXXX with million

multiple balance to to our Additionally, position and consider strengthen our have further ensure we cash to sheet long-term success. options

to would Now call to turn like operator back I the for questions. the

Justin?

Operator

from comes from Jefferies. question first Our Instructions] Michael [Operator Yee

Unidentified Analyst

for [indiscernible] Yee. taking my is This Mike for question. Thanks

So I here. guess two from

steps? also we expectations And patent roxa in value on may every recent adjustments more on think please in in the headwinds. the could comment the proposition well. next And color are you if situation to And comment years, on drive how a on is, for potential NRDL? future the sales your one, roxa something for China U.S. one And as especially you. have also pricing and roxa second tail you scenarios do plans timeline first in China? in from comment about So the to United Appreciating of how you the could down China, maybe please so mind thinking give the regulatory Thank States? could you should price counter X for process strategy value that road? the comment the also some on And you on wondering that's about occur

Enrique Conterno

Thank ask your good. the to you questions. Mark to going U.S. I'm question first Eisner about first the on Very there. and comment scenarios for potential

Mark Eisner

Yes. Thanks It's Michael. Eisner the question Mark for here.

our in the So to FDA. discussions we're to ongoing partner in and continuing and of options work CKD AstraZeneca evaluate the with we're there. terms U.S., Those continuing are our

to information that, on the upcoming weeks. timelines of able terms should provide In be we in more

I of that answered regulatory I one. the terms down road, In think

Enrique. So back I'll turn to

Enrique Conterno

including maybe then thinking comes decrease volume price the the what little a we're doing color are and new of exclusivity. to you we counteract of on also market also provide some with price growth China, Chris, about can to some color how it when provide and NRDL

Chris Chung

Enrique. Absolutely,

happens NRDL was as every So XX expected, the pricing months.

certainly So range and not cuts of the this unexpected also price was unexpected. not are

company the we have to how lower for out-of-pocket class. to So in extension in the price really of and might adoption been in a as treatment that of let HIF cut NDD out-of-pocket in the expand roxadustat plans the place in where duration basis the address had market, segments particular the affordability of price, challenging on certain with

very China. which It sense in patent to We the situation, remain are cut. parties above different encourage are to the of major the in patent for terms There and scenario make volume discussing respect what be in is believe we NRDL the topline regulations the expecting the currently a offset might obviously despite XXXX. in optimistic terms of with People's growth extension, XXXX XXXX dates continue strategies. about with regulation in is price of going the the in but one So to might what innovation of actively we couple are the things still known. are country also unclear growth would are government term patent in outlook doing Republic of are who their planning. we on increase pricing With terms patent of there the China, And some

be. of in what situation might that So we remain optimistic terms

Unidentified Analyst

you. Thank

Operator

And from our Stifel. Annabel Samimy comes next from question

Annabel Samimy

Hi, questions. my taking thanks for

I the a MDS the had just indication. So question and CIA about

on The ongoing. still CIA, is indication MDS the is that I still know I hold. So guess

thoughts something that is owned Thanks. that the going I And then And it singularly? monetize you potentially population. guess for if Are you down again any licensing them equation these further you or you risk-benefit with to about are stick it pamrevlumab, of so considering could is had any still for And fully programs? line? the owning

Enrique Conterno

Very particular Dr. CIA on and to Yes. again, Thank good. comment in to going Eisner I'm very to the ask once in you Annabel. MDS and profile. particular much, benefit-risk

Mark Eisner

Sure.

to second the of feel communicated this know, of the topline first have believe about the We ongoing. there. therapy. We should very, But a we're trial you be excited the the risk. benefit more potential doing We've Study as assessment provide why trial a comprehensive of we roxadustat results efficacious year, that very could very III half is and next. So Phase that XXX, MDS that's half evaluate

In terms completion of long CIA, we Phase not II announced our ago.

terms Phase partner AstraZeneca our planning III in their the are our of In Astellas those and U.S. with ongoing discussions Europe for and with partner territories.

Enrique Conterno

Yes.

you owned, think Annabel of and was both fully also part asked is MDS Astellas. agreements I AstraZeneca partnership whether with MDS the

of and In do as in we terms shared U.S., think, I outside are in to FibroGen pamrevlumab outside of Canada. we considering U.S. the pam, past, the we as of the partnering launch intend

Annabel Samimy

Thank you.

Operator

Thank our Ramsey question you. William next Alex Blair. And from comes from

Your line is open. now

Alex Ramsey

for Hello, I And the inquiries us received I will company on an question. one the it procedurally just just subpoena. that In disclosed has was of SEC a this could give that elaborate Alex these how on and had Andy. is go? if sense XX-K, you wondering

Enrique Conterno

SEC. And documents time, at we the SEC. as say received update a We've at know more. not Yes. the than much we point time the we will basically request appropriate from collaborating other with can are investors that in this for we There's

Alex Ramsey

much. so Thanks Okay, great.

Operator

question from And Jason Bank from comes our Thank of America. next Gerberry you.

Your open. now line is

Unidentified Analyst

Jason. the taking is for questions. for This Perry my line on Thanks

of HIFs you looks split? time? happen do with the have category around start over this on you question then current Can eroding for study LAPIS category it really China. and pamrev. do Just become you expect to submission do XX:XX submission? How evolve a is about to there potential one And on want expansion at the process about Is justify and a pathway other question towards expect to for split, of roxa based an that you readout? I an profile? event-free cancer expansion First, that pathway post result improved the on And like Do in more as the directly expect hit just thought you to ESA pancreatic talk The the survival CKD accelerated have a overall? Or you benchmark a accelerated it Thanks. your get expect to kind that. ESA clinical to away indication XX-XX. to

Enrique Conterno

questions. and some expect and the we the I'm on on ask survival Thane to about HIF-PHIs in the offer LAPIS for to Chris you what ESAs category if we color event-free future. and question could you expansion Thank the Mark and thinking that. and and then, comment are about And China between how in going the your split roxadustat

Chris Chung

Should I start?

Enrique Conterno

Sure.

Chris Chung

will I and start Thane, please supplement. So

ourselves China a we main ESA So inflammation. idea The believe some constraints, why all, of ESA anemia the of market we expansion, iron the need here anemia equivalent other injectable ask for address of if first category the CKD because is was an of underpenetrated in is the is fact and market to constraints not market. there many CKD because behind the profile, safety to it's such that as of the intravenous the in

expansion of that the HIF So we the class. direct the differentiation see is evidence of the fact category

ask sub-segments second, of of to what the would equation sufficient is class, ESA one, and you versus what be value. of price if ESA are the HIF and class XXX% continues eventually the be, price the population the yourself, over So question take will where the

supplementation of the in I differentiation of the without HIF population. routine and a terminal share the oral home-based for to terms would because category I expect increase non-dialysis in grow category. that But iron we that Thane? value that number, class to reach what terminal think the So It's nature help and personally guess be. me significant hard there's continue to the target fact the class of chronic of for could the HIF of

Thane Wettig

Chris. Thanks,

XXXX, category of roxadustat the at portion XXXX XX Just look in we make. the months ending in take points additional ending of If a growth. a drove couple to versus substantial the the months XX

XX%. over of was I that think roxadustat's portion

upon a experience And clinicians It from referred perspective. greater expect then positive what continue. to Chris from terms patient of in to pocket NRDL of based will on the affordability would and and well patients, renewal roxadustat we the continue as so the and that

their And the very so who that that point XX%-plus is is NDD dialysis is segment defined. final do are patients in receiving proposition but more to a chronic growth. with category majority still well roxadustat we anemia remains in we patients believe dialysis kidney NDD we opportunity category. for anemia population. largely treatment value in that more category will The continue continue think disease, associated there roxadustat their capture anticipate to that their of The substantial that are is for And that the untapped. to for for treated and be being NDD tailor-made

Enrique Conterno

EFS Mark, And LAPIS maybe Thane. question. the can you, you Thank address

Mark Eisner

Sure.

remind disease potential resection, So planning whether comprised decide efficacy and a from not approval. of mortality to or there for lack event-free made just utilized have be survival, based is we And is be feedback accelerated interim on locally on would a file that of would predefined FDA's decision or analysis to we as survival. after threshold the for freedom an or are which to well. of analysis, distantly an that a interim progression everybody, Based do BLA

would a there steps that So make take to decision. that of number we there's

Unidentified Analyst

Very Thank good. you.

Operator

over the to am I to no And like Conterno back further would closing showing remarks. Thank you. I call turn Enrique for now questions.

Enrique Conterno

Very good.

very Enjoy thank your for call participation everyone's today's day. in FibroGen. much much rest Now of in the very interest and Bye-bye. you investor your

Operator

Thank you today's conference for participating. concludes This call.

now may disconnect. You

FibroGen (FGEN) 1 Mar 222021 Q4 Earnings call transcript