Financial Data and Key Metrics Changes - The company reported a revenue of $7.3 million for Q1 2025, which remained flat due to a seasonal inventory drawdown despite a 15% growth in patient demand [38][39] - Cost of Goods Sold (COGS) from continuing operations increased to $2.7 million from $1.4 million in Q1 last year, attributed to increased sales of Lactorsi [47] - Research and Development (R&D) expenses decreased by 14% to $24.4 million, reflecting savings from reduced co-development with Junshi [48] - Selling, General and Administrative (SG&A) expenses decreased by 35% to $26 million, primarily due to lower headcount and non-recurring charges from the previous year [48] Business Line Data and Key Metrics Changes - The company is now focused solely on its innovative oncology business, with Lactorsi being the only FDA-approved treatment for metastatic recurrent locally advanced nasopharyngeal carcinoma [6][8] - Lactorsi is projected to grow to approximately $150 million to $200 million annually over the next three years, providing non-dilutive funding for the development pipeline [8][9] - The commercial team has successfully remapped territories and updated customer assignments post-UDENYCA divestiture, with a focus on driving growth in appropriate NPC patients [37][38] Market Data and Key Metrics Changes - The company noted a significant number of patients still receiving non-preferred chemotherapy and off-label immuno-oncology treatments, indicating a market opportunity for Lactorsi [38] - The NCCN guidelines now place Lactorsi in a preferred position for recurrent and metastatic patients, which the company is actively promoting to healthcare providers [38][41] Company Strategy and Development Direction - The company’s strategy is anchored around three core pillars: Lactorsi, CHS-114 (a selective CCR8 cytolytic antibody), and casdosoketogue (an anti-IL-27 antibody) [6][12][13] - The company aims to expand Lactorsi's indications through partnerships and combination therapies, enhancing its market presence and revenue potential [10][11] - The focus on innovative oncology is expected to drive long-term value for shareholders while addressing significant unmet medical needs in cancer treatment [50] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company’s ability to navigate recent FDA changes and emphasized the importance of strong development expertise in adapting to regulatory environments [52][56] - The company anticipates that the restructuring of the sales force will lead to accelerated growth in Q2 and beyond, despite transitional challenges faced in Q1 [60][68] - Management highlighted the promising clinical data for CHS-114 and its potential to address PD-1 resistance, which could significantly impact treatment paradigms in oncology [30][36] Other Important Information - The company completed the divestiture of UDENYCA, receiving $483 million in upfront cash and repurchasing $170 million of convertible notes [43][44] - The net cash from these transactions is expected to provide substantial liquidity for ongoing operations and development initiatives [44] Q&A Session Summary Question: What needs to happen for a significant inflection point for Lactorsi? - Management noted that increased awareness among providers and ongoing clinical trials will be crucial for driving adoption and market share [51][56] Question: Can you clarify patient demand for Lactorsi? - Demand is defined as actual patient growth, with a 15% increase in end-user demand reported, indicating strong physician engagement [65][66] Question: Will the Salesforce restructure impact future projections? - The impact of the restructure was primarily felt in Q1, but management expects Q2 and Q3 to be growth periods for the brand [68] Question: Are there any competitor molecules that have proven the efficacy of CCR8 targeting? - Management indicated that while selectivity is a challenge, there are emerging data points suggesting the relevance of CCR8 targeting in certain tumor types [72][75]

Financial Data and Key Metrics Changes - UDENYCA net product sales for Q4 were $46.3 million, an increase of 28% compared to $36.2 million for Q4 2023. For fiscal year 2024, UDENYCA net sales were $206 million, an increase of 62% compared to $127.1 million for fiscal year 2023 [24][10]. - Cost of goods sold (COGS) decreased to $118 million in 2024 from $159 million in 2023, primarily driven by lower COGS from divested products and reduced inventory write-offs [53]. - Total GAAP R&D and SG&A expenses for 2024 were $261 million, reflecting decreases in both R&D and SG&A due to lower headcount and cost savings from biosimilar divestitures [54]. Business Line Data and Key Metrics Changes - LOQTORZI net revenue was $7.5 million in Q4, a 29% increase quarter-over-quarter, with fiscal year 2024 revenue at $19.1 million [28]. - UDENYCA market share in Q4 was 15% with an exit share of 22%, with expectations for continued market share growth in 2025 [26]. Market Data and Key Metrics Changes - The company reported that nearly 80% of all NCCN institutions have used LOQTORZI for at least one patient, with a 37% increase in new accounts purchasing LOQTORZI in Q4 [30]. - The NCCN updated MPC guidelines in November 2024, placing LOQTORZI in a preferred position for metastatic and locally recurrent MPC patients [34]. Company Strategy and Development Direction - The company aims to maximize revenues with LOQTORZI, expand its indications, and advance its proprietary pipeline in innovative oncology [8]. - The divestiture of the UDENYCA franchise is a significant strategic change, expected to close in late Q1 or early Q2, which will enhance the company's focus on oncology [10][11]. - The company has divested at least $800 million in assets or commitments, paying off $480 million in debt, positioning itself with $250 million in cash post-transaction [17]. Management Comments on Operating Environment and Future Outlook - Management expressed confidence in the divestiture process, stating there are no expected obstacles and that investor support is strong [64]. - The company is focused on enhancing investor appreciation of its value proposition post-transaction, with a strong balance sheet and promising data expected in the future [12]. Other Important Information - The company has made substantial progress in its strategic transformation, including the acquisition of Surface Oncology for $40 million, which adds promising oncology candidates to its pipeline [15]. - The company expects to reduce headcount by 30% post-transaction, with a significant portion of off-balance sheet commitments transitioning to the buyer [57]. Q&A Session Summary Question: Are there any hurdles expected with the UDENYCA divestiture? - Management sees no obstacles and believes the divestiture will proceed as planned, with all necessary reviews completed [64][65]. Question: Does the $250 million cash projection include cost savings from headcount reduction? - The $250 million represents expected cash after the transaction, net of payoffs and other cash flows, and does not specifically account for headcount reduction savings [67][68]. Question: Where is LOQTORZI currently being used now that it has both front line and second line in guidelines? - LOQTORZI is being used in a mix of recurrent locally advanced and metastatic first-line patients, with expectations for increased use due to updated guidelines [73][76]. Question: What is the FDA looking for regarding the second supplier's labeling and packaging? - The FDA requires validation runs and data review from the new contract manufacturer, which has been completed [81][82]. Question: What are the expectations for the head and neck cancer data in the first half of this year? - The company anticipates reporting data from around 30-35 patients, focusing on safety, early efficacy, and biomarker data [100]. Question: How much continued use is there of off-label IO agents in the MPC market? - There is ongoing off-label use, particularly in community settings, and the company is actively working to increase awareness of LOQTORZI and the NCCN guidelines [131][134].