FOLD - NASDAQ

Good morning, ladies and gentlemen, and welcome to the Amicus Therapeutics Second Quarter 2022 Financial Results Conference Call and Webcast. [Operator Instructions]. As a reminder, this call is being recorded. I would now like to turn the conference over to your host, Mr. Andrew Faughnan, Executive Director of Investor Relations. Please go ahead.

Thank you, Cole. Good morning. Thank you for joining our conference call to discuss Amicus Therapeutics second quarter 2022 financial results and corporate highlights. Leading today's call, we have Bradley Campbell, President and Chief Executive Officer; Daphne Quimi, Chief Financial Officer; Sebastien Martel, Chief Business Officer; and Dr. Jeff Castelli, Chief Development Officer. Joining for Q&A is Dr. Mitchell Goldman. As referenced on Slide 2, we may make forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 relating to our business as well as our plans and prospects. Our forward-looking statements should not be regarded as representation by us that any of our plans will be achieved. Any or all of the forward-looking statements made on this call may turn out to be wrong and can be affected by inaccurate assumptions we might make or by known or unknown risks and uncertainties. You are cautioned not to place undue reliance on any forward-looking statements, which speak only to the date hereof. All forward-looking statements are qualified in their entirety by this cautionary statement, and we undertake no obligation to revise or update this presentation and conference call to reflect events or circumstances after the date hereof. For a full discussion of such forward-looking statements and the risks and uncertainties that may impact them, we refer you to the forward-looking statements and Risk Factors section of our annual report on our Form 10-K and on our quarterly report Form 10-Q for the year ended June 30, 2022, to be filed later today with the Securities and Exchange Commission. At this time, it is my pleasure to turn the call over to Bradley Campbell, President and Chief Executive Officer. Brad?

Great. Thank you, Andrew, and welcome, everyone, to our second quarter 2022 results conference call. Before we dive into the results of the quarter, I'd just like to start with a deep thank you to John Crowley. Has planned after 17 great years leading Amicus as our founding CEO, John has officially assumed the role of Executive Chairman of Amicus for a two year term, after which he is expected to continue as the Non-Executive Chairman of the Board. It has been an honor working alongside him for 16 of those years and it's been through his leadership and unwavering commitment to all of those living with rare diseases that Amicus is in such a great position today. I'm honored now to assume the role of President and CEO and very excited about the opportunities that lie ahead. Amicus has strong business fundamentals and a positive momentum to build on. We are poised now for the next chapter of our growth as we seek to get our second medicine approved and launched around the world. I firmly believe that we have the right people and the right assets to deliver on our mission to continue to bring great medicines to people living with rare diseases and create great value for our shareholders. Building on our commitment to patients, leadership of rare diseases and global operating platform, I am confident that we can achieve those two objectives. With that, let me get started on today's updates. I'm pleased to highlight the successful first half of the year across our business. And as we did in this morning's press release, let me highlight several key accomplishments. First, Galafold continues its strong performance and remains the cornerstone of our success. We continue to be very pleased with the uptake of Galafold globally, despite the significant foreign currency headwinds that spaced our industry this year. The first half of the year represented 11% reported revenue growth or 18% on an operational revenue growth basis. In the second quarter, operationally, our growth in key performance indicators are meeting or exceeding our objectives in all key geographies, and we are reiterating our guidance at constant exchange rates. Sebastien Martel, our Chief Business Officer, will provide further detail later in the call. We are also excited to announce that the Galafold intellectual property estate continues to grow this quarter. This year alone, we have strengthened our IP estate through the issuance of 17 new patents. There are now 44 orange book listed issued patents related to Galafold in the United States, 28 of which provide protection to 2038 and beyond, and importantly include three newly issued composition of matter patents, bringing the total now to four. We see this patent portfolio, along with our orphan drug exclusivities providing broad and long-term intellectual property rights well into the late 2030s for this novel precision medicine. And importantly, we believe we are well positioned to address any potential generic challenges to our patents. Looking ahead, we expect continued growth for Galafold this year, and with the strength in IP protection, continue to believe it has a long runway well into the next decade. Second, we continue to make progress on our global regulatory filings for AT-GAA, our novel next-generation therapy for Pompe disease. The U.S. and EU regulatory reviews are progressing very well, and we're very pleased with the level of engagement from both regulatory agencies. Clearly, all eyes are on the FDA inspection at the WuXi Biologics facility for ATB200, the biologic component of AT-GAA. We remain in active dialogue with the agency on how best to support an inspection, and we along with our colleagues at WuXi are fully ready to welcome FDA inspectors to the WuXi facility in China. However, as of today, they have not yet conducted their inspection. And if the FDA inspection does not take place in the appropriate time, it goes without saying that it could impact the timing of approval. That being said, the good news is, we are in late stage label discussions and are highly confident in AT-GAA's potential approval in the United States. And at this time, we continue to expect that the two components of AT-GAA will be approved together by the October 29 action date. Importantly, in Europe, we're now actively engaged with the EMA and the marketing authorization applications for AT-GAA. We continue to expect the positive CHMP opinion later this year and commercial launch in early 2023. And as a reminder, the EMA has indicated it does not require an inspection at the WuXi manufacturing site as a condition of their approval. I'm also extremely pleased today with the level of interest we are seeing in our expanded access programs globally. Today, we announced the first reimbursed access to AT-GAA has been granted in France under their compassionate access program, which was formerly known as the nominative ATU program. Additional access programs are in place in the United States, United Kingdom, Germany and Japan with a growing number of patients participating in each. Across all of our ongoing clinical studies and access programs, there are now more than 175 patients on AT-GAA today, which we believe represents 5% or more of the total treated Pompe patients around the world. Our global launch plans continue to move ahead, including prelaunch activities, targeted investments and additional personnel to support the launch, significant investments in the launch in inventory preparations. We are now closer to having another potential treatment option for Pompe -- for patients living with Pompe disease, both in the United States and Europe with further regulatory applications planned in the months ahead. And third, importantly, Amicus has maintained a strong financial position and remain committed to achieving profitability in 2023, as we continue to execute on the global expansion of Galafold and prepare for the global launch of AT-GAA. We are rapidly approaching two pivotal inflection points for Amicus. First, the global launch of a second rare disease medicine with AT-GAA; and second, achieving profitability. These are rare feats that we believe will enable Amicus to truly enter the upper echelon of rare disease focused biotechnology companies. I'll emphasize that we are sharply focused on three key objectives: continuing to advance Galafold to as many patients and as many geographies as possible; securing approvals for and launching AT-GAA globally; and ensuring the financial strength of Amicus. On Slide 5, we see we're well on our way now towards achieving our key strategic priorities for this year, including continuing to drive Galafold to more people living with Fabry with amenable variance in existing and in new markets. We look to achieve double-digit global product revenue growth of 15% to 20% with revenue of $350 million to $365 million at constant exchange rates. This reflects the strong momentum in demand behind this precision medicine globally. We remain steadfast in our commitment to advancing AT-GAA regulatory filings and initiating the anticipated launch of AT-GAA in the United States, leveraging our seasoned global commercial team and experience across all areas needed for an effective drug launch, we are fully prepared and anticipate a very successful launch for AT-GAA. We are strategically advancing our best-in-class next-generation genetic medicines and capabilities. And again, we will continue to maintain a strong financial position as we carefully manage our expenses and investments going forward. With that overview, let me now hand the call over to Sebastien Martel, our Chief Business Officer, who can further highlight the Galafold performance. Sebastien?

Thank you, Bradley, and good morning to everyone on the call. I'll start by providing you with more details on our Galafold performance for the quarter. On Slide 7, as you can see for the second quarter of 2022, total product revenue reached $80.7 million, driven by strong patient accruals, partly offset by foreign currency impact as well as the timing of orders in certain ex-U.S. markets. The geographic breakdown of our revenue during the quarter consisted of $53 million or 66% of revenue generated outside of the U.S., and the remaining $28 million or 34% coming from within the U.S. This is roughly in line with the 70-30 split that we expect as we continue to grow both parts of the business. Turning to Slide 8. Our results in the first half of the year highlight the strength of our global commercial efforts. The business continues to be incredibly resilient with patients added in all major markets and an operational growth rate of 17.8% over the first half of 2021 at constant exchange rates. The negative impact from foreign currencies was 6.9% in the first half of the year. And as a result, Galafold reported revenue growth was 10.9% in the first half of 2022. Just to add a bit of color on our geographical performance. In the first half of the year, our sales in the U.S. grew 16.1% at CER, while our ex-U.S. sales grew 18.5% at CER. So Galafold continues to be the fastest growing product for Fabry disease globally and has been the greatest contributor to global Fabry market growth over the last 12 months. I'm pleased to report that our monthly net patient trends continue to show positive signals. So for example, the three month trend is higher than the six months, which is itself higher than the 12 month. In the U.S. in June, we also delivered the highest number of net new patients and PRFs since April of 2021. And if you look at the growth in net patients on Galafold on a global basis, which is perhaps the truest measure of our underlying business performance, we see greater than 19% growth in patients on Galafold at the end of Q2 this year versus the same period last year. So all indications are the continued demand for Galafold. We ended the second quarter with a little under half of the global market share for treated amenable patients. And while the global mix remains about 55% switch and 45% naive, many, many geographies were starting to see stronger uptake in naive populations. So while we're achieving higher market shares in countries where we've been approved the longest, there's still plenty of opportunity to continue to switch patients over to Galafold and to continue to grow the market as we penetrate into the diagnosed and treated segments and the newly diagnosed segments. All of that is underpinned by impressive compliance and adherence rates that continue to exceed 90%, reiterating our belief that those patients who go on Galafold generally stay on Galafold. We did experience some impact due to the timing of orders in the second quarter, and we expect this nonlinear quarterly growth to continue. This order pattern led to a handful of orders being recognized in the beginning of the third quarter. Importantly, the value of Galafold continues to be recognized by payers, as we have a very strong track record of successfully negotiating and renegotiating reimbursement outside of the U.S. Our relentless focus remains on ensuring access to Galafold for anyone who needs it. Next, on Slide 9. What we've seen so far this year is that Galafold uptake continues to track very well and we're seeing growth across all of our major markets as well as most of our smaller markets. We're on track to achieve full year revenue guidance of 15% to 20% growth at constant exchange rate. And our first half growth of 17.8% at CER is right in the middle of that range. So altogether, we view this as a great first half of the year. Moving to Slide 10. We know that Galafold has the potential to surpass $500 million in annual revenue over the next few years through three key growth drivers: first, continuing to penetrate into existing markets; second, expanding into new geographies; and third, broadening the labels. I'm pleased to share that we're making continued progress on expanding into new markets. And just to name a few examples, we expect marketing authorization in Turkey this year. We have filed in the second quarter in Hong Kong. And in Chile, we're in pricing and reimbursement discussions. In the longer-term, we continue to see significant growth in the overall Fabry market globally. This will be driven by diagnosing patients through a variety of measures, including high-risk screening, newborn screening and other diagnostic initiatives, which we continue to support and invest in as well. And finally, we have orphan exclusivity in the U.S. and Europe, in addition to our now 44 orange book listed patents that give us IP coverage into the late 2030s, 28 of which provide protection through 2038, and that includes three new composition of matter patents. So that gives us opportunity to provide access to Galafold globally for a long time to come. On Slide 11, let's shift gears, and I'll provide you here with an update on our launch preparations for AT-GAA, as we're poised for another successful product launch. So unlike when we launched Galafold, and at the time we were hiring and building the commercial infrastructure from scratch, we now have a presence in over 40 countries around the world, including all the major markets. That team will be largely the same that will launch AT-GAA with only a handful of new FTEs needed, for example, take managers, TLs. We have experience across all areas that are needed for a successful drug launch, from regulatory to commercial, supply chain, experience with payers, reimbursement and access, and in addition, and maybe most importantly, the key relationships with physicians. We're confident in our world-class commercial organization. We will leverage their experience and relationships and deliver AT-GAA to people living with Pompe disease around the world. From the team, the medical education have published Phase III data in the highly regarded Lancet Neurology Journal. Our experience with reimbursement and access around the world, and again, all the strategic planning that we're doing together with our partners at WuXi Biologics, we believe we're in a very strong position for a second successful launch of Amicus. With that, let me now hand the call over to Dr. Jeff Castelli, our Chief Development Officer, to highlight our AT-GAA [product pipeline update. Jeff?

Thank you, Sebastien, and good morning, everyone. Moving on to Slide 13. We'll start with our AT-GAA program. We recognized that Pompe disease poses a range of health challenges for people affected by the disease and having therapeutic options is crucial. Pompe is a severe and fatal neuromuscular disease and one of the most prevalent lysosomal disorders. We've now seen multiple publications in natural history studies that highlight the initial benefit of treatment, often being followed by continued long-term decline on key measures of disease for many individuals. Slide 14 presents a summary of the primary and key secondary endpoints from our Phase III study. As a reminder, PROPEL was a double-blind randomized study addressing and assessing the efficacy and safety of AT-GAA in adult treatment naive and ERT-experienced participants with late-onset Pompe disease or LOPD. Against the approved therapy, alglucosidase alfa. PROPEL is the only controlled clinical trial to-date that included this ERT experience patient had, which represents one of the greatest groups of patients with unmet needs. Endpoints across motor function, muscle strength, pulmonary function, patient-reported outcomes and key biomarkers, including the two most recognized endpoints in Pompe, six minute walk distance and forced vital capacity, shown here on the slide, favored AT-GAA over alglucosidase alfa in the overall population. We believe this consistency of effect across the key disease manifestations illustrates the potential impact of AT-GAA for patients living with Pompe. Additionally, in the ERT experience population, where 95 participants were on the standard of care for more than 7.5 years on average, which is generally associated with the decline phase of disease for most patients. And we actually saw an increase in six minute walk distance and stabilization in FVC, which both achieved nominal statistical superiority versus the current treatment, and showed a clinically meaningful outcome never before seen in this population. Moving on to Slide 15. Adding to the overall body of data behind AT-GAA at the 2022 MDA Clinical & Scientific Conference earlier this year, the Amicus team presented positive long-term data from the Phase I/II study of AT-GAA. As seen here on the slide, these latest data continue to represent very meaningful and durable improvements in functional outcomes, as well as persistent reductions in key biomarkers of muscle damage and disease substrate after three years. These results have been shared with the regulatory authorities in the U.S. and EU as part of their ongoing reviews. Comparing these results with what is known about the natural history of both untreated and ERT-experienced Pompe patients, these durable results give great hope that AT-GAA indeed has the potential to become the new global standard of care for people living with Pompe disease. On Slide 16, we've highlighted key updates on the AT-GAA program. First, on the regulatory progress. Last year, the U.S. FDA accepted for review of the BLA for cipaglucosidase alfa and the NDA from miglustat, the two components of AT-GAA. If may, the agency extended the PDUFA action dates to August 29 for the NDA in October 29 of 2022 for the BLA. As Bradley mentioned, we expect these filings will be approved together by the October 29 action date, dependent again on the ability for FDA to conduct an inspection at the WuXi manufacturing facility. We've also shared that the MAA has been submitted to the European Medicines Agency and is under review. The CHMP opinion is expected later this year. Of note, the EMA has indicated in writing that based on the extensive and prior manufacturing inspections of the WuXi facility, an inspection is not required for AT-GAA approval in Europe. We now -- third, we now have multiple expanded access programs in place, including in the U.S., U.K., Germany, France, Japan and others. This includes the EAMS framework that we announced in which AT-GAA was granted a positive scientific opinion through the early access to medicine scheme by the U.K.'s MHRA. This positive opinion recognizes the high unmet medical need faced by the Pompe community and permits eligible adults living with LOPD, who have received alglucosidase alfa for at least two years to switch to AT-GAA, granting access prior to marketing authorization in the U.K. As Bradley mentioned, we're seeing significant enthusiasm for AT-GAA under the EAMS mechanism with multiple physicians now having requested access across all the leading Pompe centers in the U.K. and dozens of patients now receiving this novel two component treatment. Since the positive scientific opinion interest and momentum for AT-GAA has grown, and we are pleased to be able to provide access to those who are eligible in the U.K. In France, as Brad also noted, the National Agency for the Medicines and Health Products Safety granted the first reimbursed access to AT-GAA under their compassionate access program, formerly known as a nominative ATU program. With this growth in our access programs, we're pleased to report that now more than 175 patients worldwide are being treated with AT-GAA across our clinical extension studies and our expanded access programs, and we expect that to continue to grow. For the younger Pompe community, we continue to enroll the ongoing open-label study in children up to 18 years of age, living with LOPD and expect to expand into patients with infantile-onset Pompe disease or IOPD, later this year. Importantly, in response to the many requests for treatment that we continue to receive for children living with both LOPD and IOPD, our expanded access programs continue to increase. On Slide 17, we just announced today an early-stage program to explore next-generation pharmacological chaperones for Fabry disease through an academic research collaboration agreement with the University of Seville. This new collaboration will search for innovative small molecules with optimal activity in pharmacokinetic properties. Driven by both the science and the needs of people living with Fabry, we will be reviewing Fabry compounds based on several attributes, including potency, number of addressable amenable mutations and dosing. Of note, the agreement cost at this point are very modest, and we do not expect our fiscal year operating and will not impact our fiscal year operating expense guidance. With that, I would like to now turn the call over to Daphne Quimi, our Chief Financial Officer, to review our financial results, guidance and outlook. Daphne?

Thank you, Jeff, and good morning, everyone. Our financial overview begins on Slide 19 with an overview of our second quarter revenue performance and impacts of foreign currency exchange rates. For the second quarter, we achieved Galafold revenue of $80.7 million, which is a 4.3% increase over the same period in 2021. This includes operational revenue growth of 12.9%, offset by a negative currency impact of 8.6%. Given the majority of Galafold revenue is generated outside of the U.S., we see significant FX exposure to our reported revenue numbers. The euro, the British pound and the Japanese yen are the currencies our ex-U.S. sales are most exposed to. And on a year-to-date basis, these FX rates have declined by 8%, 10% and 15%, respectively. Applying average July 2022 foreign currency exchange rates, the impact on 2022 full year Galafold reported sales would be a negative impact of approximately 9% or $26 million. Slide 20 outlines our income statement for the second quarter ending June 30, 2022. Cost of goods sold as a percentage of net sales was 10.2% in the year as compared to 10.8% for the prior year period. Total GAAP operating expenses were $133.1 million in the second quarter as compared to $107.9 million in the second quarter of 2021. The increase included non-recurring expenses related to the reprioritization of the gene therapy portfolio. On a non-GAAP basis, total operating expenses were $119.2 million in the second quarter as compared to $93.5 million in the second quarter of 2021. We define non-GAAP operating expense as research and development and SG&A expenses, excluding share-based compensation expense, loss on impairment of assets, changes in fair value of contingent consideration and depreciation. Net loss for the second quarter of 2022 was $62.2 million or $0.21 per share as compared to a net loss of $51.2 million or $0.19 per share for the prior year period. At June 30, 2022, we had approximately 280 million shares outstanding. This year, we expect total non-GAAP operating expenses to be at the lower end of our guidance range of $470 million to $485 million, driven by continued investment in the global Galafold launch and AT-GAA clinical studies and pre-launch activities. As we highlighted previously, this guidance also includes an approximate $70 million related to certain non-recurring costs for the manufacture of AT-GAA to support the global launch as well as commitments for the gene therapy portfolio. Importantly, in 2023 and beyond, we would expect non-GAAP operating expense levels to decline below levels we saw in 2021. Turning now to Slide 21. We continue to operate from a position of financial strength and remain on track to achieve non-GAAP profitability in 2023 as defined in our press release. We will focus the majority of our investments on our core value driving franchises in Fabry disease and Pompe disease by continuing to deliver on the global growth of Galafold, securing approvals and launching AT-GAA globally, as well as driving efficiencies, cost savings and careful expense management. A few comments about our cash position and 2022 financial guidance. Cash, cash equivalents and marketable securities were $386.8 million at June 30, 2022, compared to $482.5 million at December 31, 2021. Our full year Galafold revenue guidance is $350 million to $365 million at constant foreign currency exchange rates. In addition to our non-GAAP operating expense guidance of the lower end of $470 million to $485 million. And with that, let me turn the call back over to Bradley for closing remarks.

Great. Thank you, Daphne, Jeff, Sebastien, Andrew, and thanks to all of our employees around the world who continue to work tirelessly for people living with rare diseases. And with that, operator, we can now turn the call over to open up for questions.

[Operator Instructions]. And our first question today will come from Anupam Rama with JPMorgan.

Brad, congrats on the sending to the CEO role. We all knew it's coming, but congrats again, Man. Brad, I've gotten a couple of inbounds on your opening comments that perhaps you sounded a little bit more cautious or hedged around the WuXi manufacturing inspection. So what is your level of confidence here that the inspection is completed in the near-term? And we get a timely sort of approval of AT-GAA.

I appreciate the congratulations. So yes, look, we just wanted to be very straightforward with where we are with WuXi. We continue to be extremely prepared and with our partners at WuXi to welcome the inspectors in. We're working very collaboratively and are in active dialogue with the inspectors. I think we still have plenty of time for an inspection to be conducted. We just wanted to state what I guess is fairly obvious that if that doesn't happen ahead of the October PDUFA date, then there is an opportunity then for delay. But right now, as we said on the call, we remain confident that both products would be approved at the same time and confident that we can hit that October 29 PDUFA date.

And our next question will come from Ritu Baral with Cowen.

Congrats, Brad. It's been a long time coming. Glad to see you in the seat. I wanted to ask about the labeling discussions with FDA and how to appropriately frame expectations for how -- what you see as the likely label will help you address the Pompe market as you see it? And if I can also ask the flip side to that for Europe, I think you guys have the day 120 questions at this point. How would you answer that? What -- how EMAs or CHMP is going down the path of helping you address the broadest possible market and get the broadest label?

So yes, we are really pleased with where we are with both agencies. And of course, the reviews are separate, although I think the scenarios you would play out are the same with each. We'll start with the FDA. And I think based on where we are, we are highly confident, another most important thing is in approval, and we're highly confident that we will have a label that will allow us to be successful in our commercialization of AT-GAA. I think the most important thing that we're focused on that we've continued to reiterate is that, we have what we think is a highly differentiated product, in particular, based on the very compelling data that Jeff reviewed around showing nominal statistically significant improvements in six minute walk in the switch population, as well as stabilization of forced vital capacity. Those are -- those data never have been seen before in a well-controlled study. And we think those are the most important data to have within a label to be successful. As long as we have those data and as long as we're in line with where we are with the discussion today, I think we're very confident that we'll be able to address the commercial need in the commercial market for AT-GAA. I think it's important to remember that there's roughly 3,200 patients on AT-GAA today. And so that represents the vast majority of the unmet need in Pompe disease. And so based on where we are, we're very confident, we'll have a successful label to support those patients. I think in Europe, again, it's a separate discussion. And I think the same scenarios could play out there. I think the same emphasis is there in terms of making sure that we have those key data in the label. We're confident that the progress there reflects, again, a very successful outcome, and we're eager to conclude that and looking forward to potential approvals at the end of this year and launching early next year.

And our next question will come -- go ahead.

I was just going to say, let me just clarify. I think I said last time, 3,200 patients on AT-GAA, it's 3,200 patients on standard of care.

And our next question will come from Joseph Schwartz with SVB Leerink.

I was wondering if you can talk a little bit more about the expanded access experience to-date for AT-GAA. And are there any unifying characteristics or patient segments that are identifiable here in the adoption to-date? And do you think that -- it's likely that any of these patterns might carry over to the marketplace, if and hopefully when AT-GAA is approved?

So first of all, really excited to have the first reimbursed access for AT-GAA through the compassionate access program in France. I think that's just a really important milestone exciting and hopefully a bellwether for more to come. And I would say there are a few broad buckets of those access programs. Of course, part of it is just our ongoing clinical trial patients who are primarily laid out that patients who came into our studies in Phase II and Phase III. The biggest cohort of patients is the EAMS access program in the U.K. And we think that's really important because it's a label that reflects the unmet need in Pompe disease. And it provides an opportunity for patients and for physicians to, I think, a completely kind of unaffected way from Amicus, it's not a promotional program, allows them to select going on to AT-GAA. And I think that population who are, as Jeff mentioned, required to be on therapy for two years before being accessed -- before being eligible for access to AT-GAA. I think that represents the vast majority of the market today and seeing, I think, a strong preference and strong utilization, now more than a dozen patients entering in that program, I think, is a great example of what we can see in the future. And then we do, of course, also see a variety of patients who are either infantile-onset, who are really looking for some opportunity for better outcomes as well as pediatric and some later onset patients as well in other markets. I think that just demonstrates the unmet need that remains out there and the hope that we can provide with AT-GAA, and we're very much looking forward to continuing to be able to serve those markets over time.

And our next question will come from Ellie Merle with UBS.

Just a follow-up on the U.S. manufacturing inspection. I guess when typically in the review cycle would you expect the inspection to occur by? And I guess how long ahead of the October 29, PDUFA, where it needs to be scheduled by for you to be confident that it could be completed ahead of the PDUFA? I guess, just in terms of like the scheduling and how long it would take on schedule? Just any color that you could give on that. And then just a quick one on Galafold. You mentioned that in June, you saw the highest number of net new patients in the U.S. on Galafold. Is this something that you expect just around seasonality? Or is this sort of a broader trend that you expect to continue?

I'll let Sebastien take the Galafold question and provide additional color there. But starting on the WuXi inspection. Look, I think we've said before there are a variety of options the FDA can utilize to support an inspection. There could be paper-based, there could be hybrid, there could be direct inspections from folks from the United States, and we're prepared to support any one of those. We actually know just recently that WuXi supported a virtual inspection, a paper-based inspection from a different regulatory authority. We also know they just hosted the U.S. Commerce Department, who inspected on that unverified list. So we know inspectors are able to get in and spectrums are able to be conducted. In terms of timing, I don't want to get too cute there, but I think we just wanted to be fully clear that we're prepared to support an inspection. We're confident that we are poised for approval, but just acknowledge that, that does need to happen prior to the PDUFA date in order for the approval to go forward at that point. Sebastien, if you want to address Ellie's question on the U.S. Galafold dynamics and maybe broadly what we're seeing in Galafold?

Absolutely. I think that you asked whether there was some degree of seasonality in what we've seen in the U.S. of late. And my answer would be, not really. This is more related to the level of activity that we've seen. Clearly, our interaction with HCPs has been picking up significantly. When we compare beginning of this year versus beginning of last year, we've had -- we've seen in some countries, almost a ten-fold increase in face-to-face interaction. That's having an impact. We're also -- second element that we're seeing in the U.S. is, we continue to see an increase in the number of prescribers of Galafold. So unique prescribers of Galafold continue to increase. So we have more physicians prescribing Galafold. And the trend that we've seen over the last few months in the U.S. seems to continue to play here with July. So we're in good situation in the USA.

And our next question will come from Dae Gon Ha with Stifel.

Congrats on all the progress. A question from me is on the 2023 financial guidance. Maybe for Daphne, can you speak to the sensitivity around your 2023 projections of non-GAAP profitability and how the non-GAAP OpEx is being lower than '21? I just saw the footnote on the press release where it does kind of talk about the variability and predictability. Just wanted to get a little bit color around that sensitivity.

Yes, Daphne, do you want to address that?

Sure. Yes. So I think the comment is really coming from the fact that we do have some -- especially in the R&D space, we have some expenses that we've experienced over the past few years, specifically related to AT-GAA for the manufacture of the product. Once it is approved, that spending will move over to the balance sheet and flow through the income statement and cost of goods sold. So there is a large piece of that OpEx that will no longer be there. So when we look out into the future, that's the largest piece, I would say, that's driving that commentary. There is also -- or there are some expenses this year that are non-recurring in nature as related to the reprioritization of the gene therapy portfolio. So those are expenses that we have this year that will not occur in the future. So it's really related to those two items predominantly. Is where that comment is coming from.

And our next question will come from Salveen Richter with Goldman Sachs.

This is Matt on for Salveen. Could you guys please just give us an update on the Fabry gene therapy program and then also the next-generation chaperones you mentioned?

Yes, Jeff, maybe I'll start, and then I'll kick it over to you. So as a reminder, we continue to have, we think, very differentiated approaches in both Fabry and Pompe gene therapy, and those are still important programs for us. We continue to move those technologies forward, but I think in a very measured and targeted way given the reprioritization of our program with the idea, I think there are some broader gene therapy questions we're still looking to answer before we can put those forward into the clinic. But I will say as it relates to the next-generation chaperone, I think that's a reflection of Amicus' commitment to be -- continue to be at the forefront of developing new therapies for anything for Fabry or Pompe. And while it's early, I think it's an exciting opportunity for us there. But maybe, Jeff, you can give a little bit more color.

Yes. Thanks, Brad. And nothing really to add on the Fabry gene therapy in addition to what Bradley commented on. And for that Fabry chaperone discovery collaboration, we're very excited to enter that. It's very early stage, as we have meaningful data, we will present that at conferences. But right now, it's really trying to see if there is a way to expand the number of amenable mutations that we could benefit more patients with a small molecule chaperone. And then just related to that, see if we can improve some of what we believe is an already very strong profile for Galafold. But to see if there is additional benefit we can bring to Fabry patients to a chaperone. But we will provide updates as they come.

And our next question will come from Kristen Kluska with Cantor Fitzgerald.

This is Rick on for Kristen. What, if any, effect do you believe the foreign exchange headwinds could have on the 70-30 split that you've talked about in ex-U.S. and U.S. sales as you grow the Galafold business? And how are you thinking about this effect as you continue to guide towards expanding into new markets?

Yes. I think as you saw -- and I'm getting a little -- going the line. But I think as you saw there were a slightly greater distribution of revenue coming from the U.S. this year versus ex-U.S. So I think it was like 33% versus 67%, which is still near that 70-30, but that just shows the -- I would say, the slight impact on Europe. I think in general, going forward, we would expect that 70-30 split on average. To your point, as new markets come on, you do see those will typically be outside of the United States, but of course, it's all different currencies. So we're not in the business of predicting FX around the world globally. But I think the most important thing is the growth rates between the two remains strong. We continue to expect significant growth in U.S., significant growth outside the U.S. and roughly over time, that should balance out to about 70-30.

[Operator Instructions]. Our next question will come from

Congrats on the progress as well. I want to ask about the -- in your Slide 16, you talked about ongoing support of studies on LOPD and IOPD. Maybe can you talk about the implications there and how that relates to your label discussion? And secondly, just looking at Galafold sales in the first half and full year guidance, considering the negative impact from foreign exchange, it looks like the second half, they will be pretty flat concerning the foreign strange. Maybe provide a bit of color on that?

Maybe I'll take the end of that question first. And then, Jeff, you can come back to the development strategy and how it will impact the label over time. So as it relates to Galafold growth, look, we're not in the business of predicting foreign exchange rates. But I think we've just said as a point in time, what could the impact be on the actual reported revenue. For us, the most important thing is the underlying business remains strong, remains growing and growing robustly. And I think that point that Sebastien made around the 19% growth from this time last year in terms of patients, that's really the business demand, right? So that's really how the business is growing, and it's growing really strongly and growing right in line with what we said it would. As it relates to the second half of the year, usually we see a greater distribution of revenue in the second half of the year versus the first half of the year. And so, we are very confident that we will see that. And from an operational basis, we're reiterating our guidance of $350 million to $365 million. Again, exactly how foreign exchange impacts that is difficult to predict. But for now, we've provided that kind of point estimate for what the impact could be from a reported perspective. But again, for us, the importance is that the business is strong and growing, and growing in all key markets, and we continue to anticipate that going forward. But Jeff, do you want to talk a little bit about the Pompe development strategy in particular, the different populations laid off and pediatric.

Yes, sure. So as a reminder, PROPEL was included only adult patients. So the vast majority of the data in our initial submissions will be focused on adult Pompe patients, and that would be our expected initial labeling. We do have an ongoing pediatric LOPD study, and we do have agreement with regulatory agencies to do an extrapolation of efficacy from the adult patients down into those pediatric LOPD patients. And we are imminently getting ready to start adding IOPC patients to that clinical trial as well. We do need to look at some measures of efficacy and safety in that IOPD population. So we expect initial labels focused on adults, but then as we have data sufficient to add in the pediatric patients, we will. And as I noted on the call, we continue to treat multiple pediatric patients, IOPD, LOPD through expanded access where there is significant need.

And our next question will come from Ritu Baral with Cowen.

I just wanted to drill down a little more into the U.S. dynamics and the sort of return to growth or growth re-acceleration. I guess I'm surprised that new prescribers are still growing this long into the launch? And also, I'm wondering how much mutations play into it. You guys have the number of mutations on the European label in the slides. But how does that compare to the U.S. label? And are those still growing the number of mutations in the U.S. label? Was that driving the growth? Is there like a cash you're about to hit, which triggered the next-gen program?

Yes. So as it relates to the growth dynamic in the United States, I think it really has more to do with what Sebastien described, which is increasing opportunity for physicians and our sales and medical team to be together. While we did a great job of maintaining those virtual interactions, I think kind of nothing beats face-to-face. And it probably represents also some improved access for patients and physicians and more frequent access for patients and physicians, so that physicians can start patients on therapy. So whether it's a bit of a new normal or whether it's some adjustment and ability to now kind of handle COVID in a different way, I think that's really what's driving that kind of resurgence in demand. But I can say that even in July, we're continuing to see great numbers, not just the U.S., but around the world. And again, that 19% growth rate in patients coming on to therapy from end of second quarter versus end of second quarter last year. To me, that says the business is growing strong, and we continue to expect that. As it relates to the mutations piece, no, you're right. Remember, the really interesting and exciting part about the European label is that we were able to characterize all of the theoretical mutations that could be amenable to the chaperone and the Europeans accepted that concept of amenability, and we were able to expand the label, so that even though we -- not every mutation had an actual patient diagnosed with that mutation, if we find one who does have those mutations, then they can immediately be eligible for therapy. In the United States, it's slightly different. While they fully accept the amenability concept in order to update the label in the United States, we are obligated to find a patient with that mutation and then we can subsequently update the label. So it's just a little bit of a slower process. But eventually, presumably, we'd find a majority of those amenable patients. As it relates to prescribers, I think, honestly, that's just a reflection of the rare disease space where these patients and physicians are -- continue to -- we continue to find new patients, we continue to then have new physicians. And we do continue to see new prescribers come on board, which I think just again reflects the continuing growth opportunity for Galafold. So all great positive signs for the business for years to come.

And how many mutations are, I guess, left in the U.S. as you see it to be included in that later?

Jeff, you want to give the -- I mean what's the European label, Jeff? And then what's the U.S. label?

Yes. So I think it's almost 1,400 amenable mutations in European label, and it's around 350 in the U.S. So look, we continue to add mutations every year as patients and patient families (technical difficulty) have a novel mutation. So we do expect that, that number will keep coming up over time. I don't think it will ever reach the true theoretical rate. But as Brad said, it really doesn't limit access in the U.S., it just might cause a slight delay as it might be a mutation that's not in the label. We've already tested them, so we don't have to dream on the assay. We just need to go through the paperwork with FDA to add it to the label.