erus BioSciences(US:CHRS)2025-05-12 22:02Financial Data and Key Metrics Changes - The net loss from discontinued operations for Q1 2025 was $9.2 million compared to a net income of $170.9 million in Q1 2024, primarily due to a $153.6 million gain on the sale of the Similee ophthalmology franchise in March 2024 [49][50] - Revenue for Q1 2025 was flat at $7.3 million, attributed to a seasonal inventory drawdown despite a 15% growth in patient demand [39][40] - Cost of Goods Sold (COGS) from continuing operations increased to $2.7 million from $1.4 million in Q1 2024 due to increased sales of Lactorsi [48] Business Line Data and Key Metrics Changes - 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 [10] - The commercial team reported a 15% growth in patient demand for Lactorsi, with an increase in new patient starts and duration of treatment [39][40] Market Data and Key Metrics Changes - The market for nasopharyngeal carcinoma (NPC) is estimated to be valued at $150 million to $200 million, with expectations for Lactorsi to achieve a dominant share [43] - The restructuring of the sales force was completed, and the team is now focused on driving growth in the NPC patient population [38] Company Strategy and Development Direction - The company is focused on innovative oncology, with three core pillars: Torapalumab (Lactorsi), CHS-114 (a selective CCR8 cytolytic antibody), and casdosoketogue (an anti-IL-27 antibody) [7][14] - A key part of the strategy includes partnerships for indication expansion, where the company supplies drugs to partners who fund clinical trials [11] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's ability to adapt to changes in the FDA and emphasized the importance of strong development expertise [54][57] - The company anticipates that Q2 and Q3 will be times for growth, following the restructuring of the sales force [69] Other Important Information - The company expects to achieve approximately $25 million in annualized savings from lower headcount following the divestiture of UDENYCA [47] - The company has received $483 million in upfront cash from the UDENYCA divestiture and plans to repurchase remaining convertible notes [45] Q&A Session Summary Question: What needs to happen for a significant inflection point for Lactorsi? - Management noted that awareness among providers is increasing, and they expect to see an acceleration in growth following the restructuring of the sales force [53][58] Question: Can you clarify what you meant by patient demand for Lactorsi? - Demand refers to actual patient growth as indicated by clinics purchasing the product from wholesalers, which is distinct from revenue [66][67] Question: Will there still be an impact from the sales force restructure in Q2? - Management believes the impact was primarily in Q1, and they expect Q2 and Q3 to be times for growth [69] Question: Are PD-1s like Keytruda still being used off-label in NPC? - Yes, off-label use of PD-1s is prevalent, especially in community settings, despite NCCN guidelines recommending Lactorsi [73][79] Question: Can you discuss the Type D meeting with the FDA for CHS-114? - The meeting focused on aligning on Project Optimus, and the FDA found the company's approach acceptable [84][86]