ARQT - NASDAQ
Arcutis Biotherapeutics, Inc.
ARQT·NASDAQ
$21.35
-0.56%HealthcareBiotechnology
Arcutis Biotherapeutics, Inc., a biopharmaceutical company, focuses on developing and commercializing treatments for dermatological diseases. Its lead product candidate is ARQ-151, a topical roflumilast cream that has completed Phase III clinical trials for the treatment of plaque psoriasis and atopic dermatitis. The company is also developing ARQ-154, a topical foam formulation of roflumilast for the treatment of seborrheic dermatitis and scalp psoriasis; ARQ-252, a selective topical janus kinase type 1 inhibitor for hand eczema and vitiligo; and ARQ-255, a topical formulation of ARQ-252 designed to reach deeper into the skin in order to treat alopecia areata. The company was formerly known as Arcutis, Inc. and changed its name to Arcutis Biotherapeutics, Inc. in October 2019. Arcutis Biotherapeutics, Inc. was incorporated in 2016 and is headquartered in Westlake Village, California.
At a Glance
Live SnapshotMarket Cap$2.67B
EPS-0.1300
P/E Ratio-164.23
Earnings Date08/05/2026
Earnings Call Transcript
ARQT • 2026 • Q1
Operator
Good day, and thank you for standing by. Welcome to the Arcutis Biotherapeutics, Inc. First Quarter 2026 earnings conference call. At this time, all participants are in listen only mode. After this brief presentation, there'll be a question and answer session. To ask a question during the session, you'll need to press star 1-1 on your telephone. You will then hear an automated message advising your hand is raised. To withdraw your question, please press star 1-1 again. Please be advised that today's conference is being recorded. I would now like to hand the conference over to your first speaker today, Brian Schoelkopf, Head of Investor Relations. Please go ahead.
Brian Schoelkopf
Thank you, Marvin. Good afternoon, everyone, and thank you for joining us today to review our first quarter 2026 financial results and business update. Slides for today's call are available on the investors section of the Arcutis website. Joining me on the call today are Frank Watanabe, President and CEO of Arcutis, Todd Edwards, Chief Commercial Officer, Patrick Burnett, Chief Medical Officer, and Latha Vairavan, Chief Financial Officer. I'd like to remind everyone that we will be making forward-looking statements during this call. These statements are subject to certain risks and uncertainties, and our actual results may differ. We encourage you to review all the company's filings with the Securities and Exchange Commission, including descriptions of our business and risk factors. With that, let me hand it over to Frank to begin today's call.
Frank Watanabe
Thanks, Brian, good afternoon, everyone. As always, we appreciate you guys making the time to join us. I want to start today's call with an overview of the latest developments at Arcutis and the progress we're making against our grow, expand, build strategy. I'll then turn things over to Todd for a commercial update, then Patrick for an R&D update, and finally Latha for a review of the quarter's financial results, as well as how we're thinking about investing in 2026 to drive
Frank Watanabe
In a nutshell, our plan is to continue to grow our core
Frank Watanabe
We also completed enrollment in a MUSE trial for
Frank Watanabe
This team will embark on a targeted effort to engage with those primary care and pediatric clinicians who are already using a fair bit of topical therapies in their practice. We also continue to make important progress against our expand pillar as we work to bring the unique benefits of
Frank Watanabe
We're also evaluating additional phase II proof of concept trials and indications beyond vitiligo and HS, we'll obviously update you guys on our further decisions. Finally, we reached an important milestone in our pipeline building activities with the initiation of a phase I-A, phase I-B trial for ARQ-234. The investments we're making and the efforts we're taking to advance our initiatives across these three pillars are laying groundwork for further
Frank Watanabe
These investments in innovation and growth reflect that intent. With that, I'll hand the call over to Todd to give you a Q1 commercial update.
Todd Edwards
Great. Thank you, Frank, and good afternoon, everyone. Turning to slide 7. We continue to see strong sales performance in the first quarter with net product revenues of $105.4 million, up 65% versus the first quarter of 2025. This healthy quarterly performance was achieved despite the customary first quarter seasonality impacting branded therapies driven by patient deductible resets, elevated co-pay utilization-Annual insurance transitions and pull forward of refills into Q4. This typical pattern was further amplified this year by the impact of severe weather events we had across the country during the quarter. On an aggregate basis and in line with expectations, this resulted in a more significant sequential decline in product revenues from Q4 to Q1 compared to 2025, where seasonality was mitigated due to the initial launch of
Todd Edwards
Importantly, we are through the impact of this typical seasonality and anticipate a return to robust quarter-on-quarter demand growth going forward. Our gross-to-net remains stable in the 50s, and as communicated on our last call, we anticipate it will remain in the same range for the remainder of 2026. Our first quarter gross-to-net rate improved compared to Q1 2025 due to our evolving payer contracting that benefited product revenues for the period. Looking ahead to the second quarter, we expect quarter-over-quarter net sales growth driven primarily by increasing patient demand as well as continued gross-to-net improvements as we progress from our current rate to the low 50s as the year progresses. Turning to slide 8.
Todd Edwards
After a typical December to January pullback in demand, weekly prescriptions on a rolling 4-week average based on IQVIA Xponent data have returned to a healthy growth trend and reached approximately 21,000 prescriptions per week across all indications and formulations for
Todd Edwards
Investments we have made to expand our dermatology sales force will also contribute to demand growth in the second half of the year, and our efforts in primary care and pediatric settings will start to have an impact later in 2026 and 2027. I'll provide some additional detail on demand across topical therapeutics in dermatology in the first quarter. I'm on slide 9. As demonstrated in the chart on slide 9, prescription volumes were down across the board for topicals in the first quarter of 2026 compared to the fourth quarter of 2025. Of note, the impact was not only seen with branded products, but also with topical corticosteroids, antifungals, vitamin D analogs, and topical calcineurin inhibitors. Products in these categories are primarily generic, making them less sensitive to the typical seasonality experienced by branded products in the first quarter.
Todd Edwards
Yet this year, they still saw marked sequential declines quarter-on-quarter. We believe that this dynamic speaks to the fact that the severe weather events in the first quarter impacted dermatology healthcare providers prescription volume in general, a headwind that compounded typical seasonality and affected the entire topical segment. Of note, the prescription decline for
Todd Edwards
We are excited about the key investments we are making in 2026 to drive
Todd Edwards
Katie brings incredible breadth and depth of experience with dermatology therapeutic commercialization, having held various strategic and operational leadership positions, and she has already begun building out the rest of her team. As we described previously, we are adopting a high targeted approach with this sales team focused on high volume, earlier doctor PCPs and pediatricians concentrated in major metropolitan areas, positioning this investment to be accretive from the outset. From there, we will evaluate additions to the sales team as we further refine our strategy and gain in-depth understanding of the space.
Todd Edwards
We look forward to completing the initial build-out process next quarter with a launch into the field in Q3, initial impact to demand beginning in the 4th quarter. Rounding out focused commercial investments are Free to Be Me direct-to-consumer patient awareness campaign featuring Tori Spelling, her daughter Stella McDermott, and professional golfer Max Homa has driven strong, meaningful patient engagement. Their shared collective experiences are helping to drive awareness for
Patrick Burnett
Thank you, Todd. Good afternoon, everyone. In the first quarter, we continued to make significant progress in our efforts to support young children and infants suffering from plaque psoriasis and atopic dermatitis. Starting first with atopic dermatitis, children under the age of 2 are the most vulnerable patients in a population that desperately needs alternative therapeutic options to the handful of currently available treatments. As a dermatologist, I can tell you firsthand how challenging it is to sufficiently address these diseases in this age group, given the very limited set of approved therapies, and how eager their parents and caregivers are for effective, safe, and well-tolerated treatments to bring comfort to their kids. Safe, well-tolerated treatments are especially important in this age group when the immune system and the skin barrier are still developing.
Patrick Burnett
We take their plea very seriously, and we believe the clinical profile and formulation of
Patrick Burnett
That's defined as a score of 0, which is clear, or 1, which is almost clear, with at least a 2-grade improvement. Close to half of infants achieved a vIGA-AD score of clear or almost clear. That's a 0 or 1 at week 4, and 24% already at week 2. For those infants with at least mild scalp involvement at baseline, more than two-thirds achieved vIGA scalp success at week 4. As previously highlighted, 58.3% of infants achieved at least a 75% reduction in their Eczema Area and Severity Index. That's an EASI-75 at week 4, and three-quarters of infants already at week 2. To the right, we see a representative patient.
Patrick Burnett
This is a 23-month-old boy who'd previously been treated with topical corticosteroids with an IGA of 3 or moderate severity at baseline, and he's showing significant improvement at week 4 with an IGA of 1 or almost clear. I think these photos really represent the meaningful impact that our 0.05% cream delivered to patients in this study and why we're so excited to already have these data submitted to the FDA. Collectively, the findings from the INTEGUMENT-INFANT study add important clinical evidence on the promise of investigational
Patrick Burnett
I wanna highlight one particularly notable result that we shared from INTEGUMENT-INFANT at the AAD, namely the rapid impact that
Patrick Burnett
Through our clinical trial experience and feedback from clinicians in the field, we appreciated that the speed with which
Patrick Burnett
To that end, we recently initiated a study, INTEGUMENT-ITCH, to assess descriptive classification of pruritus over time with
Patrick Burnett
As Frank mentioned in the opening, we submitted a supplemental NDA to the FDA in April for
Patrick Burnett
We recently completed enrollment of a MUSE trial, or maximum use trial, for
Patrick Burnett
I'll note that the rationale for extending our label to the infant population for atopic dermatitis does not apply to plaque psoriasis or seborrheic dermatitis. Onset of diseases in these patient populations is common in atopic dermatitis, while it's not in the other two diseases. Our current label in seborrheic dermatitis positions us to effectively serve the addressable patient population. Potentially securing a label expansion to the pediatric age range in plaque psoriasis will similarly equip us to serve the addressable patient population. As demonstrated in the table on slide 14, these latest developments in expanding our indications to additional pediatric and infant populations build on a consistent focus we've maintained over the years to broaden the availability of
Patrick Burnett
We also anticipate that when healthcare providers see how effectively
Patrick Burnett
However, after a series of disappointing clinical data sets and growing safety concerns for these programs targeting OX40 already leading to program discontinuations, that hope has dissipated, leaving a wide space for novel new treatment pathways. It's our belief that the CD200 axis targeted by ARQ-234 could bring an important new tool for providers and an important new option for patients. The CD200 axis plays a central role in both innate and adaptive immunity, with CD200 signaling reducing immune activation for T cells, type 2 innate lymphoid or ILC2 cells, and myeloid cells, and decreasing secretion of pro-inflammatory cytokines. Given the impact of this axis, there's a solid basis for optimism about the role of CD200R agonist programs may play in treating inflammatory diseases.
Patrick Burnett
The phase I trial for ARQ-234 is comprised of a single ascending dose or SAD component in healthy volunteers, which is currently ongoing, and a multiple ascending dose or MAD component, followed by a proof of concept cohort, both in patients with moderate to severe atopic dermatitis. While we will not share the results from the trial until completed, we will keep you apprised of our progress through these different components. Moving on to slide 16. As you can see, we've already delivered on several meaningful clinical milestones in 2026 and look forward to continuing clinical progress throughout the year.
Patrick Burnett
Of note, we continue to enroll our phase II proof of concept trials in vitiligo and hidradenitis suppurativa or HS. We're nearing full enrollment for our vitiligo trial and remain on track to provide a readout of trial results and an update on our clinical development plan in Q4 of this year. A similar readout for our HS program in Q1 of 2027 also remains on track. Todd alluded earlier to the continued shift from topical steroids to advanced targeted topical therapies like
Patrick Burnett
I would call your attention in particular to one of the conclusions of the recently published expert consensus statement on advanced non-steroidal topical therapies for atopic dermatitis, which came out in March in the Journal of Drugs in Dermatology. As you can see, some of the most distinguished experts in the field agree that advanced non-steroidal topicals should be preferred over topical corticosteroids for long-term management of atopic dermatitis due to their cleaner safety profiles. This is typical of what we continue to hear from the leaders in dermatology. This growing consensus will propel the conversion to the newer agents, of which
Latha Vairavan
Thank you, Patrick. I'm on slide 19. We generated net product revenues in the quarter of $105.4 million, which is up 65% from Q1 of 2025. This year-over-year increase was driven primarily by increased patient demand. We also had lower gross to net in the first quarter of 2026 versus a year earlier, contributing to higher net product revenues. As Todd mentioned earlier, this improvement in gross to net was primarily driven by the evolution of our payer contracting, and while our gross to net rate is lower to begin the year, we still anticipate our gross net to be in the 50s throughout 2026, ending in the low 50s.
Latha Vairavan
Cost of sales in the first quarter were $9.8 million, compared to $8.8 million in the first quarter of 2025, primarily due to increasing
Latha Vairavan
We anticipate a modest increase to the SG&A expense in the back half of the year, driven by headcount-related costs for the dermatology sales force expansion and the build-out of our primary care and pediatric sales team. We are maintaining our revenue guidance in the range of $480 million-$495 million for the full year 2026. Moving to slide 20, you can see that we had cash and marketable securities of $224.3 million on our balance sheet as of March 31st, 2026. Importantly, we maintained positive cash flow in the quarter, with $2.2 million of net cash provided by operating activities. We will continue to be disciplined in our investments in the business to maintain positive cash flow throughout the rest of the year.
Latha Vairavan
We have total debt of $101.5 million and have the right to withdraw another $50 million in whole or in part at our discretion through the middle of 2026. I am now on slide 21. With the continued broad adoption of
Latha Vairavan
Concurrently, we are reinvesting capital generated from our
Brian Schoelkopf
Thanks, Latha. Thanks again to all of you for joining us today and for your continued interest in Arcutis. I'm immensely grateful to our team and very proud of their hard work, their dedication to building shareholder value, and their commitment to the patients we are serving. With that, I'll open up the call to Q&A.
Operator
Thank you. At this time, we'll conduct the question and answer session. As a reminder, to ask a question, you'll need to press star one one on your telephone and wait for your name to be announced. To withdraw your question, please press star one one again. Please stand by while we compile the Q&A roster. Our first question comes from the line of Andrew Tsai of Jefferies. Your line is now open.
Andrew Tsai
Hey, good afternoon. Thanks for the nice set of updates. Thanks for taking my questions. It sounds like gross net performed better than compared to last year, Q1 of last year. Can you guys maybe qualitatively describe what drove that better %? Was it something within your control? What, you know, what kind of positive impact could that have for the rest of the year? I know you kind of guided gross net for the rest of the year. Is it fair to assume blended gross net for this year could be better than the blended gross net for 2025? Thank you.
Frank Watanabe
Sure. Todd, you wanna take that one?
Todd Edwards
Frank, I'll take that call. Andrew, thank you for the question. yeah, as mentioned, we did have pricing improvement in the first quarter of this year when relative to Q1 2025. This year-over-year improvement was primarily driven by improvements in formulary status with more preferred versus non-preferred position with some of our commercial plans. What this means is that for a patient, for a preferred status, it's a lower copay versus non-preferred position. With the preferred status and lower copay for the patients, that leads to lower copay expenses and lower copay buydown for Arcutis, giving us the pricing upside. Now, while our rate is lower than the prior year, we continue to anticipate that we'll be stable in the 50s without a doubt throughout the year.
Todd Edwards
As mentioned, we'll be working down from the higher 50s at the beginning of the year, transitioning to the lower 50s at the end of the year as patients continue to buy down the deductibles and we have lower copay expenses. Now, as we look forward, I think it's a bit too early to anticipate how all these factors will carry forward to future years. I remain very confident that we'll continue to have a very strong gross to net, and we'll maintain our gross to net within the 50s going forward. Thank you for the question.
Andrew Tsai
All right. Mm-hmm. Thank you.
Operator
Thank you. One moment for our next question. Our next question comes from the line of Tyler Van Buren of KeyBanc. Your line is now open.
Tyler Van Buren
Hey, guys. Thanks so much for taking the questions. Just to help quantify the quarter-over-quarter impact and the Q1 seasonality as we compare to Q4, can you help us understand how much of that was the gross to net impact versus volume impacts from weather or Q4 pull forward? The second part or follow-up is, I understand that you're saying that Q2 sales will be above the first quarter, but do you believe it's likely that Q2 sales could significantly exceed the sales that were posted in Q4?
Frank Watanabe
Yeah. Hi, Tyler. Yeah, Todd, you wanna take that one too?
Todd Edwards
Yeah, absolutely. Thank you, Tyler. In reference to the quarter-on-quarter impact of seasonality, and the differential between gross to net and demand as we've highlighted, you know, there was an upside on gross to net due to the formulary status change from non-preferred to preferred, with the as mentioned, the demand, you know, saying relative to the 6% on that. You know, if you think about it, with the seasonality, which is typical because of the pull forward of the refills into Q4, we got employers that are often changing insurance for the employees that's effective January 1st of the year. That transitions impacts relative to
Todd Edwards
As noted, this was compounded relative to the weather impact. I will just mention that this whole weather impact and demand impact was not just limited to the topical products. I mean, if you look at the systemics, they were also impacted as well. For example, Otezla was down 11%, Rivfloza 3%, and DUPIXENT 2%. This is on volume due to this seasonality with this being amplified by the impact of the weather. Relative to Q2 sales and how we think about them going forward, I will mention that Q2 quarter to date through April 24th,
Todd Edwards
We're off to a very strong start, within Q2 here, and I have high confidence that we'll continue to build on this, demand trend and have robust growth quarter-over-quarter as we go forward.
Operator
Thank you. One moment for our next question. Our next question comes from the line of Seamus Fernandez of Guggenheim Securities. Your line is now open.
Colleen Garvey
Hi, this is Colleen on for Seamus. Thanks for taking our question. When thinking about this year's sales guidance, what are the assumptions driving the lower end of the guide? By our math and just based on the current prescription trajectory, we're starting to struggle to land within the upper end of the guide and consensus looks to already be above. Just trying to understand the pushes and pulls to maintain the current guide. Thanks.
Frank Watanabe
Hi, Colleen. You know, look, I, I would say that, you know, we just updated the guidance in February, so not that long ago. You know, we don't intend to update our guidance at least for the moment every quarter. You know, we'll continue to evaluate the trend as the year progresses and if we feel that it's appropriate to update the guidance, we will. We felt that at this point early in the year, particularly with the slightly anomalous Q1, we felt that it was prudent just to hold fast. Latha, Todd, I don't know if there's anything else you wanna add to that.
Todd Edwards
Nothing else, Frank.
Latha Vairavan
Hey, Colleen, I would say that we issued the guide after the end of the year. As Frank said, we don't see the need so early in Q1 to take it up. As the year progresses, as the guide range changes, you'll be able to align more to where the demand trajectory is headed. For now, I think you can lean into the upper end and stay there.
Colleen Garvey
Great. Thank you.
Operator
Thank you. We're moving for our next question. Our next question comes on line of Tudor Farmer of Morgan Stanley. Your line is now open.
Judah Frommer
Yeah. Hi, guys. Thanks for taking the question. We appreciate kind of the updated trends on total scripts and the share being taken there. Anything you're noticing in NRX new scripts and any trends that are indicative of where TRXs could move going forward? Thanks.
Frank Watanabe
You're talking absolute volume share?
Judah Frommer
Yeah. I would say share of new scripts, how that's trending. If anything has changed, has that formulary position maybe impacted what new scripts are doing?
Frank Watanabe
Okay. Sure. Todd, do you wanna take that one?
Todd Edwards
Yeah, I'll take that one. When we look at the Q1 for
Todd Edwards
The other is when you look at our refills, look at our total volume prescription of that, our refills are about 45%, which is once again very encouraging for us, not only on the NBRx, but also on the refills that are contributing to our TRX and our overall growth. You know, if I look within Q2, and I look at approximately the last 3-4 weeks, we've had very impressive NRX growth with
Judah Frommer
Great. Thanks.
Operator
Thank you. One moment for our next question. Our next question comes from the line of Uy Ear of Mizuho. Your line is now open.
Uy Ear
Hey, guys. Yeah, thanks for taking our questions. I have two, if I may. The first question is, could you maybe just help us understand or quantify the opportunity from the infant's atopic dermatitis conditions? I think, Frank, you mentioned it was a significant opportunity. Maybe just help us understand how you'll capture that opportunity. Is it primarily through the derm sales force that you currently have or from building out the primary care pediatric sales force? That's the first question.
Frank Watanabe
Sure. Sure.
Uy Ear
Yeah.
Frank Watanabe
Go ahead. Did you have another one, Uy Ear?
Uy Ear
Yeah, I do.
Frank Watanabe
Sure.
Uy Ear
The second question is, maybe Latha. The SG&A was lower than what I think we or the consensus expected, something like by $4 million. Now that you have the full sales force expansion, do you expect an uptick in the second quarter? 'Cause I thought, if I heard correctly, I don't know what the starting point is, but you indicated that you were expecting a modest SG&A uptick in the back half of the year. Maybe just help us understand the cadence of spending for the year. Thanks.
Frank Watanabe
Okay. Thanks, Uy Ear. Patrick, maybe why don't we start, if you wouldn't mind sharing maybe a dermatologist perspective on the 3 to 24 month opportunity and the unmet need. Then Todd, maybe you can address sort of how we're gonna get at that commercially. Then Latha, if you could address his question around OpEx.
Patrick Burnett
Yeah. Sounds good, Frank. You know, I think this 3 to 24 months group, and I'll let someone else kinda comment on the, you know, kind of absolute size of that group. I think, you know, they are uniquely reflecting a patient population that has You know, we're talking about essentially crisaborole approved there, and then, maybe 5 or 6 topical corticosteroids. I think this really is a group that as we've been out kinda talking to pediatric dermatologists, and these patients are not just managed by pediatric dermatologists, they're managed by a lot of dermatologists, dermatology PAs and NPs as well, that this is one where people really do struggle to be able to get these patients under control. Obviously, it's not a group that you wanna jump to a systemic right away.
Patrick Burnett
They tend to have a higher body surface area. Their disease tends to evolve kind of quickly over time into a pretty high percent of involved skin. And kinda as we alluded to in the call, there's a really high sensitivity to exposure to corticosteroids right out of the gate. I mean, you know, these are very, very young patients and, you know, the developmental milestones are at the top of mind for caregivers. So really kind of finding something that fits into that mindset, I think
Patrick Burnett
I think we kind of alluded to the fact that, you know, this is a way to really win the hearts and minds of prescribers because if you can solve this problem for them, you know, I think it really helps with the overall lift for the brand and what it means for the field. You know, I think that's the derm perspective and, you know, as far as the overall size of the opportunity, I think I'll turn it over to you, Todd, to talk about that.
Todd Edwards
Thank you, Patrick. I'll just reemphasize, as Patrick mentioned, this patient population is tremendously underserved. If you think about it's really just EUCRISA, which burns and stings upon application, is available, and then topical corticosteroids, which of course brings great concerns to a caregiver, you know what I'm saying, relative to steroid exposure. How we're going to drive this opportunity as we go forward once we get the approval will be across both the dermatology sales force as well as the PCP and pediatric sales force. Dermatology sales force because we do have pediatric dermatologists as well as other dermatologists that see this population and wanna make certain that, you know, we're conveying there's a revalued proposition for this population.
Todd Edwards
Of course, with our primary care and pediatric team, they'll be calling on pediatricians to make certain they create that awareness for the patient. In addition to that, you know what I'm saying, we'll be doing a lot of direct-to-consumer campaign. When I say consumer, it's the caregiver. You know, we'll be making certain that we're reaching out and we're driving brand awareness of
Frank Watanabe
Latha, can you address Uy Ear's question about the OpEx?
Latha Vairavan
Yes. Hi, Uy Ear. I would say that SG&A for Q1 was slightly below consensus, but we don't see a dramatic decline, so nothing to concern yourself there. The field force just started in Q2. You'll see a portion of that hitting Q2 actual, so sort of normalization of that. The expansion for the primary care field force that'll happen in the second half is what the comment modest increase references. Some of the initiatives that Todd talked about, you'll see some of that expense also play out for the course of the year. That's our feedback on SG&A being higher year-over-year.
Uy Ear
Okay. Thank you.
Operator
Thank you. One moment for our next question. Our next question comes from the line of Serge Belanger of Needham. Your line is now open.
Serge Belanger
Hi. Good afternoon. Thanks for taking my question. The first one just regarding coverage for
Frank Watanabe
Yeah. Todd, sorry to wear you out, but you wanna take those two?
Todd Edwards
Yeah. No, I'm happy to. They're great questions, so thank you. First one in reference to the coverage question and making headway relative to Medicaid and Medicare. You know, we will continue to make headway in Medicaid. You know, we can do that within 2026 as we continue to contract with these individual states relative to the fee-for-service Medicaid. We're currently in negotiations and conversations with some of those states we don't have
Todd Edwards
It is, you know what I'm saying, likely gonna be a January 1st, 2027, but there is opportunity with the Part D plans to be able to pull that forward into 2026. As previously communicated,
Todd Edwards
What mainly differentiates between high decile and medium decile is the opportunity to prescribe, meaning that the higher deciles have a higher patient base, higher patient load. You know, they typically do tend to be more rapid adopters of branded products. With this median decile providers, there's ample opportunity for us here to continue to expand
Serge Belanger
Thank you.
Todd Edwards
Yeah, no, it's a great question. Thank you. I'm sorry, Frank. I just jumped in on that.
Frank Watanabe
No problem with you. They're all looking at you today.
Todd Edwards
Oh, thank you. What we're doing differently is, I mean, what we're going to do to make certain that we set this primary care PCP team up for success and that we can drive utilization of
Todd Edwards
These will sit within the major metropolitan areas. Also, we'll make certain that within each of these representative territories, that we'll have a defined number of targets to where we can make certain that that representative can have the right frequency on each target to be able to drive trial and adoption of
Frank Watanabe
Sure. Todd, you got a pass. Patrick, you wanna take that one?
Patrick Burnett
Thanks, Frank. Yeah. As we're looking at vitiligo and HS, you know, keeping in mind that these are smaller open label trials, what we're really trying to understand is what does the
Patrick Burnett
I think that's where the mechanism of
Patrick Burnett
You know, where does that fit within the treatment paradigm that has emerged, where many of those patients are pretty quickly being moved to systemics, even if they might have, you know, disease that might be able to be managed by an effective topical. There, I think we see a little bit more blue sky for that. What we're gonna try and outline as we get into Q4 for vitiligo is a pretty clear understanding of both what we're seeing from the response profile, but also where we see the commercial opportunity and how we would see that profile fitting into the landscape. Yeah.
Frank Watanabe
I Maybe I could just add one additional thought to Patrick's comments. I think, you know, specifically in the HS case, we saw this again with the Avalo data today, the systemic therapies are not particularly effective in this disease. Even patients on systemic therapy are often going to need adjunctive treatment.
Operator
Thank you. I'm showing no further questions at this time. I'll now turn it back to Frank for closing remarks.
Frank Watanabe
Okay. Well, I will just thank everyone again for making time. I know it's a busy time of the year for you guys. Appreciate you calling in and look forward to talking to you all in another quarter. Thanks. Bye-bye.
Transcript from May 6, 2026
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