Good morning. My name is Rocco and I am your conference operator today. At this time, I would like to welcome everyone to the conference call. All lines have been placed on mute to prevent any background noise. After the speakers’ remarks, there will be a question and answer session.

[Operator Instructions] Please also note, today’s event is being recorded. Thank you. I would now like to introduce Beth DelGiacco, Vice President of Investor Relations. You may begin your conference. .

Thank you, Rocco. A press release was issued earlier today with our third quarter 2020 financial results and business update. This can be found on our website, along with the presentation for today's webcast. Before we begin, I'd like to remind you on Slide 2 that forward-looking statements may be presented during this call.

This may include statements about our future expectations, clinical development, regulatory time lines, the potential success of our product candidates, financial projections and upcoming milestones. Actual results may differ materially from those indicated by these statements.

Our genus is not under any obligation to update statements regarding the future or to conform those statements in relation to actual results unless required by law. I am joined on the call today by Tim Van Hauwermeiren, Chief Executive Officer; Keith Woods, Chief Operating Officer; and Eric Castaldi, Chief Financial Officer.

I will now turn the call over to Tim..

at Thu Oct 22 18:44:00 2020 ]specifically the new data we presented from ADAPT, updates on our ITP PV and CIDP trials and our Fifth indication. I will then move to the rest of our pipeline including cusatuzumab and argenx-117.

Keith will provide more context on our commercial readiness activities, followed by a financial update from Eric before we take your questions. Let me begin with efgartigimod.

In May, we reported that the global Phase 3 ADAPT trial met its primary endpoints, which was a responder analysis in acetylcholine receptor antibody positive patients during the first treatment cycles.

67.7% of efgartigimod treated patients compared to 29.7% of placebo patients achieved a greater than 2 point improvement on the MG-ADL score for at least four consecutive weeks. Similar results were seen on the QMG score. 84.1% of responders had an onset of response in the first two weeks.

Slide 5 shows that 40% of all patients or about two-thirds of responders achieved an MG-ADL of 0 or 1, classified as minimal symptom expression and a substantial proportion of responders saw impressive durability with almost 60% of patients experiencing a benefit of eight weeks or longer and one-third of patients experiencing a benefit of 12 weeks or longer.

Additional data from ADAPT were presented earlier this month at the MGFA Scientific Session by our principal investigators Dr. James Howard. These data confirmed that the rapid and clinically meaningful responses to efgartigimod that we saw from the top-line that also showed additional analyses on the magnitude and the feasibility of response.

On Slide 6, to assess the magnitude of response, we look at the MG-ADL and QMG score reductions at before or one week after the last infusion. As you can look at increasing thresholds of improvements, the treatment arm continues to show benefits while the placebo arm goes to zero.

We were particularly pleased to see that 60% or more of patients achieved at least a five point improvement on the MG-ADL and at least a 6 point improvement on the QMG. A third of patients achieved a QMG improvements of at least 9 points.

These responses and the proportion of patients achieving minimum symptom expression are unprecedented and capture the most important component of this trial. These are not just scores. These are patients who are feeling better and the substantial numbers are virtually symptom-free.

With regards to repeatability, if you look across cycles one and two, almost 80% of efgartigimod patients were considered MG-ADL responders. This included 36.8% of patients who were not MG-ADL responders in cycle one, but were in cycle two.

We saw that MG-ADL score reduction was consistent in both cycles with a mean change from baseline of 4.6 in cycle one and 5.1 in cycle two. We also show some additional analyses on the acetylcholine receptor antibody negative patients.

You’ll recall we saw a high placebo response in these patients based on the MG-ADL score by including the more objective measure QMG in the analysis. We started to see more separation from treated and placebo patients.

Put simply, the data shows that these patients responded to efgartigimod that did so quickly and with a significant depth and duration of improvements. This is supported by a safety profile, comparable to placebo with no reduction in serum albumin.

These data first demonstrates how efgartigimod is uniquely differentiated and has the potential to be the best-in-class FcRn antagonist. On Slide 9, you can see on our pipeline the next steps for efgartigimod in GMG are on track and we are pleased to confirm that we plan to file the BLA by the end of this year.

In addition, our interaction with the FDA regarding the subcutaneous bridging strategy in MG is set to occur before year end and we will communicate on the path forward once we have regulatory feedback.

We have heard from patients, physicians and payers that having both on IV and in subcutaneous formulation for efgartigimod will be a significant competitive advantage in MG and other indications.

Our exclusive access to the Halozyme technology for the FcRn targets enables our subcutaneous administration to be a single, fast injection which we also believe is optimal for patients’ comfort and convenience.

As we talk through our other indications, and the specifics of those trials, you can see that we are actively prioritizing subcu developments to accommodate patient preferences and to adjust to this new normal where patients may not always have ease of access to all sites of care.

This brings me to the evolving strategy of our ITP program on Slide… [Technical Difficulty].

Pardon me everyone. This is the conference operator. We seem to be having an issue with the audio. [Operator Instructions] We are going to reconnect to the speakers. Please standby. And pardon me everyone. This is the conference operator. We are reconnecting the speakers at this time. So we will be starting the call back up here in just a moment.

Please standby. Thank you. Thank you for holding everyone. This is the operator. We have reconnected the speaker rotation and you can please begin your presentation. Thank you. .

Thank you. So this brings me to the evolving strategy of our ITP program on Slide number 10. We discussed this strategy on our last update call to address the enrollment delays we’ve been facing due to COVID-19. We consolidated the original pre-registration studies into two.

One is the ongoing IV-only advanced trial and the other is a subcutaneous-only advanced subcu trial, which is on track to begin by the end of the year. This program realignment shows our ability to adapt and be nimble as an organization and I am pleased with the direction in which we are headed.

Ultimately, the – change will expedite the path for efgartigimod in ITP. Moving on to CIDP on Slide 11. The Phase 2 ADHERE trial of subcutaneous efgartigimod is enrolling well and the go, no go decisions expand the trial of 230 patients will occur after the first 30 patients are treated in Part A.

As stated in today’s press release, we now expect that decision to occur in the first half of 2021 with a specific timing dependence on the impact of COVID-19 delays. Based on initial interactions with the FDA, we believe the expanded trial could be sufficient for registration in CIDP.

We will also be evaluating subcu efgartigimod in our Phase 3 ADDRESS trial in Pemphigus which is on track to start too. I would like to take a moment to describe this trial in more detail.

As we are deeply developing our Phase 3 trial in MG, we are working closely with patients and physicians to design the ADDRESS trial, as well by signing with key stakeholders we can more fully understand the remaining unmet need for Pemphigus patients and identify how efgartigimod might best offer a solution to fit into the existing treatment paradigm.

Pemphigus is a skin barrier disease. So speed of onset is a crucial aspect of potential therapy, patients want to see healing of lesions and achieving of disease control and clinical remission as quickly as possible. We also learned that patients prioritize the ability to taper off steroids to manage side-effects.

Slide 12, the Phase 3 ADDRESS trial will be a randomized, double-blinded, placebo-controlled study, where the objective is to assess efficacy, safety and tolerability in up to 160 newly diagnosed or relapsing patients with moderate to severe Pemphigus. The trial will include both Pemphigus vulgaris or PV and Pemphigus Foliaceus.

So PF for the PF population will be kept in a similar manner to the acetylcholine receptor negative population in GMG studies. Patients will be randomized to receive either subcu of efgartigimod or placebo for 30 weeks. Patients will start on Concomitant steroids based on what we determine to the optimized dosing regimen from the Phase 2 study.

The primary endpoint will affect the proportion of patients who achieve complete remission on a minimal steroid dose at 30 weeks. Before I move to the rest of our pipeline, I would like to briefly mention the Fifth indication for efgartigimod which will be discussed in more detail during an investor event in the first half of 2021.

So this program is not delayed, and we think its own track and be moving forward. We are just not sharing yet what this indication exactly is at this time.

Given the evolving competitive landscape in the FcRn class we have decided that it will be most prudent to provide full context around this new indication closer to the Phase 2 trial initiation with next year.

Our team is on track at all Phase 2 preparation work and they are working hard to design a thoughtful trial as we done in all indications to-date. While we wait to share details until next year, we can say that we are very excited about the opportunity this indication presents to rare disease patients.

It is the criteria we use for our indication selection strategy that means there is a clear – around the role of both antibodies and the defined clinical and regulated path forward. It also fits squarely into our franchise structure with an attractive commercial opportunity across more than one of our potential therapeutic franchises.

In this way it aligns with our role of strategy to leverage our growing commercial capabilities across multiple indications. We continue to have the broader development program among FcRn antagonist and are committed to roll out new indications at the pace of at least one per year.

Going forward, we will take an approach to talk about each indication just before to get to initiation so not to share information before it’s necessary. Now on to cusatuzumab and ARGX-117. On Slide 13, we will be sharing top-line data from the Phase 2 CULMINATE trial in early 2021 as promised.

Based on an early look from CULMINATE, we have selected 20 milligram per kilogram as the go-forward dose and will be prioritizing a combination approach of cusatuzumab with the emerging standard-of-care venetoclax.

The Phase 1b ELEVATE trial evaluating double and triple combinations of CUSA, AZA and VEN continues to evolve following a pause due to COVID-19. Slide 14, we started the Phase 1 healthy volunteer study of ARGX-117 targeting C2. Data from this study are expected mid-2021.

The Phase 1 trial will assess PKPD pre-C2 levels and bioavailability of both IV and subcu formulations. We will also use the Phase 1 study to identify a Phase 2 dose. That’s where our approach to efgartigimod, we plan to launch multiple Phase 2 proof-of-concept trials on the heels of strong Phase 1 data.

We are looking at severe autoimmune diseases and have already selected multifocal motor neuropathy or MMM as an initial indication. We also continue to look at potential kidney indications.

Finally, as part of our argenx 2021 vision, we aim to be a global integrated immunology company prioritizing both our commercial efforts, as well as our R&D engine through our immunology innovation program.

ARGX-118 is a lead optimization status as we determine how best to address the groundbreaking biology on the role of Charcot-Leyden crystals in severe airway inflammation out of the lateral [Indiscernible] We are also on track to finalize ARGX-119 this year and we will likely be communicating more on this pipeline candidate early next year.

As we said many times about our IIP, which is a program about co-creation which is at the heart of everything we do at argenx. We recognize that partnering with leading disease biologics will allow us to unlock value in our key commercial franchises and brings forward the most innovative therapies to patients.

Continued investment in our antibody engineering capabilities is a key component of our role in IIP relationships.

We recently announced two new technology partnerships with Chugai and the Clayton Foundation underscoring our commitment to the IIP by enhancing our capabilities to build the best antibodies possible and broaden the range of targets that we may address.

We also announced that we will be expanding the scope of our collaboration with Halozyme for access to the ENHANZE drug delivery technology. Under the expansion, we gained three additional exclusive targets by combination which brings the total to six potential targets. We have already exercised access for two targets FcRn and C2.

We believe that having access to the ENHANZE technology for current and future product candidates will allow us to reach more patients that are – to the antibodies. With that, I would like to turn the call over to Keith to discuss our commercial preparations in more detail.

Keith?.

Thank you, Tim. If we could go to Slide 16, please, it has indeed been a very exciting year for argenx. I am pleased to report that our commercial readiness activities remain on track as we prepare to file our first BLA by the end of the year and reach patients in 2021.

An important part of our ongoing rolling BLA submission is our safety database, which we accrue from our ongoing ADAPT open-label extension. The retention rate and the open-label extension has been impressive and we expect to be able to share data from this study at future medical meetings.

We also are on track to file the JMAA in Japan in the first half of 2021 and prepare for a launch there in 2022. We continue to progress our launch strategies in Europe and we’ll file with the EMA shortly after filing in Japan. We expect to be able to share with you more details about our European strategy early next year.

We have committed to our first three priority regions for the commercial launch of efgartigimod. But we also recognize the importance of making efgartigimod available globally and we are working through our strategy in the rest of the world likely relying on a partner for some regions.

Of course, the use of additional Phase 4 clinical trials in many regions of the world, as well as an expanded access program is a key factor in our patient-centric values.

In terms of commercial preparation, we are building an outstanding team in our three key regions, hiring leaders with significant launch experience in rare disease and even MG specifically.

There is no doubt the right team to launch efgartigimod has been given their deep knowledge in the neurology space, their excitement around the potential of efgartigimod and their commitment to patients.

We continue to grow our field team including medical research liaisons, though leader liaisons, and key account directors on the payer side and we expect to start hiring our planned 70% U.S. sales force by the end of this year.

We recently launched our disease awareness campaign, which we know will be a crucial component to our commercial success, particularly around engaging physician customers and building awareness of this new mechanism of action. We want to ensure that our key audiences understand FcRn as a target and the role that the auto antibodies play in MG.

We continue to gain important insights from patients, from advocacy groups and physicians. We have been pleased and even surprised by our ability to have very productive conversations virtually whether it’s through advisory boards or events such as the MGFA or AANEM.

This will be a good practice for the team as we do expect to launch in at least a partially virtual environment next year. Furthermore, while we are still in the early phase on engaging with U.S.

payers feedback from both regional and national payers has been positive, the potential for individualized dosing offered by efgartigimod is attractive and it offers the opportunity for patients to only receive treatment when they really need it.

We continue to build out and scale our global supply chain to ensure continuity of drug supply when we launch in the U.S., Japan and Europe.

As you know, we have a long established alliance with Lonza for our manufacturing with facilities in both the UK and Singapore and the potential to expand even further as we launch in to additional geographies for indications.

We’ve partnered with Vetter for our Fill & Finish of our drug products and now with Cardinal for our third-party logistics here in the U.S. We trust that our partnerships with these three well-established players is the right decision for such a key component of our launch. Now before I hand the call over to Eric, we take a look at Slide 17.

I want to quickly mention important projects that we’ve been working on to engage MG patients and build awareness of this devastating disease. Next month we are excited to premiere A Mystery to Me, a documentary film about myasthenia gravis.

We partnered with film producer Sarofsky to capture the hidden told MG can take on those who live with it every day. We hope that by watching this docuseries, we can give a voice to MG patients and encourage broader empathy for people who not only suffer from MG, but from any rare disease that can lead people feeling isolated and misunderstood.

And with that, I’ll turn the call over to Eric..

Thank you, Keith. Slide 18 covers our third quarter 2020 operating results, which are also detailed in today’s press release and regulatory filings.

Total operating income for the nine months ended September 30, 2020 was EUR42.6 million, a decrease of EUR18.6 million from the same period in 2019 due to a milestone payment we received last year under the AbbVie collaboration agreement, and partially offset by the revenue recognition of the transaction price related to the Janssen collaboration and also an increase in other income driven by higher payroll tax rebates.

R&D expenses for the nine months ended September 30, 2020 were EUR246.3 million, compared to EUR122.8 million for the same period in 2019. Selling, general and administrative expenses were EUR100.4 million for the nine months of the year, compared to EUR41.7 million for the same period in 2019.

These increases in R&D and SG&A expenditures over the prior year have been driven by the progress made within our late-stage pipeline, including higher clinical trial costs and manufacturing expenses, the recruitment of additional employees to support ongoing activities and higher consulting and personnel expenses.

We expect operating expenses to continue to increase this year, as we further advance our pipeline and prepare for future commercialization.

For the nine months ended September 30, 2020, financial expenses, which mainly relates to interest received under – sorry, received and change in fair value of current financial assets amounted to EUR1.7 million, compared to a financial income of EUR10.8 million for the same period in 2019.

Exchange losses totaled EUR55.9 million for the nine months ended September 30, 2020, compared to an exchange gain of EUR26.9 million for the same period in 2019.

The total net loss for the nine months ended September 30, 2020, was EUR205.6 million, compared to a net loss of EUR45.1 million and an operating loss of EUR54.5 million for the same period in 2019.

We ended the first nine months of 2020 with EUR1.8 billion in cash, cash equivalents and current financial assets, compared to EUR1.3 billion on December 31, 2019. The increase was principally due to the closing of a global offering last June including a U.S.

offering and the European private placement, resulting in the receipt of EUR730.7 million of net proceeds. I will now hand back the call to Tim..

Thanks, Eric. Please turn to Slide 19. Before we take your questions, I want to take this opportunity to offer my gratitude to our exceptional team with hard work and unwavering devotion to patients continue to fuel us towards our first commercial launch.

We see the growth operation for FcRn antagonist to be a transformative option for patients suffering from serious autoimmune diseases.

With our positive Phase 3 ADAPT data in hand, our growing team and commercial infrastructure, a deep pipeline of differentiated early and late-stage programs and our strong balance sheet to drive our company forward, I believe we are well positioned to realize our argenx 2021 vision and to generate long-term value for our shareholders.

Operator, you may now open the call for questions. Thank you. .

Thank you. [Operator Instructions] Today’s first question comes from Yatin Suneja with Guggenheim. Please go ahead. .

Hey guys. Thank you for taking my question and congrats on all the progress. Can you maybe just talk conceptually about the pricing? I mean, it seems like there are certain indications where you might need a little bit more chronic treatment or dosing in certain indication where you can get away with intermittent chronic dosing.

So, if you can conceptually talk about that? So that’s the first question. The second question is, could you maybe remind us what the infusion time is for the Halozyme subcu and what volume are you targeting? Thank you. .

Thank you, Yatin. So, on your second question, it’s very simple. It’s subcu injection not an infusion which is a very important difference. This is a very second subcu injection with a volume of just about 5ml.

Keith, maybe you would like to take the first question, the conceptual question on pricing across different indications?.

Yes, happy to, Tim.

So, Yatin, last call we actually discussed the pricing and how we were thinking around MG and we actually set some kind of some goalpost and said, looking at chronic IVIg as the floor given our strong efficacy, safety and convenience and remember, we said chronic IVIg on average is about a $146,000 per year to treat an MG patient and that’s just the average.

So, you are more frequently treated patients, it goes up. We’ve also talked about the other book in being soliris, but we’ve also - that we plan on pricing - grounding our pricing and value and do not expect to be up there towards soliris.

So, we have the opportunity to price based on the data that Tim shared with you in the call today which right now is the most impressive data that’s been released in a Phase 3 study. So, we do have this opportunity to bring value to patients.

As far as the individualized dosing schedule compared with some additional indications that might be more chronic, I just want to remind you that in ITP for example, although we will be – we are using a more chronic dosing schedule, you also know that physicians that treat ITP after they get their patient managed the main thing that they want to do is slowly turn them off of medication.

We also know that Pemphigus for example, we are able to treat patients and get them into complete remission and once we do, you’ll see where that will not be treated chronically, but yes that next player.

So, we’ve done a lot of home work on this and we’ve had the opportunity to study a great deal of our data from the ADAPT study and we now feel very comfortable in moving forward with our pricing strategy that we’ll tie into MG, but also think about second, third, fourth, fifth and even more indications. .

Thank you. Our next question today comes from Yaron Werber with Cowen. Please go ahead. .

Yes. Hi. Thanks for taking the question. So, I have just a couple about the trial design, maybe, Tim. Number one, for MG, I just – I am not sure what you could comment. The subcutaneous bridging study historically we’ve been hearing FDA has wanted to see efficacy data.

If you look at rituxan, you look at – and darzalex, but those indications don’t have a biomarker like IgG.

So, how does that factor in? And can you use an IgG as a sort of a primary surrogate and then maybe like an eight week clinical endpoint? And then secondly, for PV, I see that the trial design makes a lot of sense, another trial design that’s unclear was we are talking about is maybe doing some concomitantly with rituxan as a sort of an acute and then chronic.

Any thoughts, is that’s something you might wanting to do down the line? Thank you. .

Thank you, Yaron and thank you for being with us on the call today. So, concerning the breaking strategy I think you are spot on. Strategy means that you are playing the strength and we believe that efgartigimod is a unique drug when it comes to delivering the linear correlation between its PV effect, i.e. the reduction in IgG and clinical benefits.

I think the ADAPT study has again clearly demonstrated that any it’s the data in hand that actually we have to pass the needing request with the FDA. So, there is a science base case to be made. The best way until we have the meeting behind us.

I do not want to preempt that meeting and we will certainly communicate about the outcome of the meeting as soon as we have the written minutes. And on your Pemphigus study design, you are right, I think there is several entry points into the space of Pemphigus.

And actually, we decided to access – work with patients and physicians to read and knew the facts on some of actions and the ability to reduce the steroids as fast as possible in our first study.

So I think this placebo-controlled trial in the background of suboptimal prednisone or corticosteroid dosing is actually going to replicate hopefully the success of the Phase 2 study and that’s a very compelling proposition and can test into the states.

Ultimately, how efgartigimod is going to co-exist with rituximab is of course corticosteroid but if and when we prove success with the first study. .

And our next question today comes from Tazeen Ahmad with Bank of America. Please go ahead. .

Hi. Good morning, thanks for taking my question. Hopefully, you can hear me clearly. Hi, Tim. Just wanted to ask you, as we wait for CULMINATE’s top-line data in early 2021, can you give us an idea of what type of information we should expect at this first look at the study. And what data we should consider to be encouraging for the program. Thanks. .

Yes. Thank you, Tazeen. So, obviously, a newly diagnosed - patients for chemotherapy would look to see in these data would of course be the number of responses and the quality of responses on the one hand and of course, the duration of these responses.

And we think also the safety information is going to be very important because we see the future for really diagnosed CTML patients to be combination therapy. So, the combined ability of your drug with venetoclax, with or without Vidaza is going to be very important also from a TOX point of view.

And then also expect data which will clearly explain why the dosage – what we chose it to be. So, the 20 mg versus the 10 mg per kg data. .

Thank you. Our next question today comes from Derek Archila with Stifel. Please go ahead. .

Great. Hey. Good morning and thanks for taking my questions.

So, Tim, just two on CIDP and maybe first, just wondering if you could provide any color on some of the challenges you are or were facing with the CIDP study enrollment and what gives you confidence that you’ll be able to put out the results in the first half of 2021? And then, second, I’d love to get your insights on the type of responses that would make you – make this a go decision and if there are earnings and reference points in terms of maybe IVIg responses that could kind of inform us here on the inductor side? Thanks.

.

Thank you, Derek for this excellent question. So, CIDP, it was very thoughtful paradigm in close partnership with physicians and patients. So, we see it’s – to being very well received by the community and a very high level of motivation of both physicians and patients to participate.

I think the slowing down factor here is of course the COVID-19 pandemic. More specifically the work on sites to initiate sites, open sites and to get patients to sites.

So, I think the study has really picked up momentum after the first wave of the pandemic we are and now I think the – be to navigate through what’s clearly the second wave going through Europe and through probably the U.S. So, it’s COVID-related.

And to our delight, I think the study has lot of traction with the community and we keep – of patient expansions around innovation and think that space which is actually top for innovation and at the 30s IVIg, people really want to see something argenx can invest.

And on the second question, response, we have not been public on the definition of go, no go decision points. But clearly I can call out for example the response rate which we are seeing in the only blinded randomized placebo-controlled IVIg study, there is a ICE trial where we saw a 53% response for IVIg versus a 21% response for placebo.

So, I think that’s an interesting point of reference. .

And our next question today comes from David Nierengarten with Wedbush Securities. Please go ahead. .

Hey. Thanks for taking the question. Maybe looking a little bit farther in the future, we are likely to see – from like - get use in myasthenia gravis at a bit lower price point and soliris in a, call it a much less frequent infusion.

How are you thinking about the competitive dynamics between your, both IV product and your subcutaneous products relative to a less frequent C5 inhibitor? And in particular, both by competitive dynamics and the potential for out of pocket costs affecting the decision between a subcutaneous format and the ID format from a competitor? Thank you.

Thank you, David.

Maybe, Keith, you would like to take this question?.

Yes. Happy to. David, thank you for the questions and both very good questions. Ultimately, we are bringing forth both formulations, IV and subcu into hopefully all indications, but certainly into MG upfront.

Remember, we went forward with IV, because of a speed to market strategy and that strategy is paying off as we said, we’ll be able to launch in 2021.

But as we bring the bridge forward, we know that weekly dosing when you can have a response rate that as Tim shared in the prepared remarks that was up to almost 80% that you have patients responded between cycle one and cycle two and you have a safety profile of which we had.

When we talk to patients and we ask them to rank what is important to them, the number one thing is efficacy and relieving of symptoms and number two is safety. Actually, they recommend ranked the route of administration towards the bottom of the five measures that we took a look at with them.

So, when we are producing this type of efficacy and safety for a patient, you are going to have patients that are going to want to be on therapy.

I think our subcu, as Tim mentioned with a simple, single, easy injection that they will be able to administer to themselves at home, you combine that with an individualized dosing schedule can provide quite some convenience for our patients as well.

So, I guess, the answer to you is, individualized dosing schedule with IV and a combination of the self-injection at home is how we think about with the overall efficacy rate is how we think about how we compete.

I guess, the last thing that I’ll say in regard to the C5, David, is that, we believe that an FcRn plays upstream of the C5 and by utilizing it FcRn and removing the auto antibody from the neuromuscular junction, you therefore have fewer auto antibodies to recruit complement.

So, we can affect the neuromuscular junction in three different mechanisms – ways with our mechanism of action versus just one being complement. Lastly, you mentioned, out of pocket expense and that’s where we have great optionality, because of the out of pocket expense that could be experienced with subcu.

We have the IV formulation that will be available. Additionally, the work that we are doing right now in our pre-commercialization is to be able to address to make efgartigimod accessible to patients that require whether that would be with some type of patient assistance programs or even in some situations, compassionate use.

So, we are looking into all of these things. So that we can bring forth the product competitively. .

Thank you. Our next question today comes from Akash Tewari with Wolfe Research. Please go ahead. .

Thanks so much. For, CIDP, how many naïve patients are you targeting to be included within your first 30 go or no go decision? I think we’ve seen from the I-trial that 56% of those patients were IVIg naïve.

What internally gives you confidence that an FcRn will have efficacy in that patient population? And will your go or no go decision look at refractory and naïve patients separately and then I have a follow-up. Thanks. .

Thank you, Akash. We are satisfying within the CIDP population for subsets of CIDP and as you correctly pointed out, we are allowing in both naïve and refractory patients. And basically what we see in the study so far is a good split between the two. I mean, there hasn’t been a pre-defined number.

So, I think we will be in a position at the go, no go decision point for the first 30 patients to look and trying to correlate signal we see not just with sub-types of CIDP, but also with disease status. So, I would say, stay tuned. We have a good representation of both classes in the study. .

Okay. Great. And just - I like and at the recent Investor Day you talked about – for the GMG market looking at the 80,000 patients who were potentially even not totally controlled on steroids, you talked about an FcRn being upstream of a C5.

How – I think, kind of how much do you think you could penetrate that market? And is there a possibility that you can expand to – into that larger patient pool? Thank you. .

Keith?.

Sorry. Yes, yes. Thanks for the question. So, I’ve got to tell you what our KOLs are telling us right now, which is, I’ve heard Dr. Howard just recently talk about where he would use efgartigimod. And first place he started is, he would replace the IVIg. He would replace plasma exchange with this product.

The second thing that he talked about was being able to use it in a bridging manner because of its rapid onset of action using it in patients where it would take a little while for another therapy to kick in like a broad immunosuppressive therapy.

So, he mentioned using that upfront and maybe either replacing ISGs or certainly bridging them to patients to ISTs. The next area that he shared was patients hate steroids and what the ADAPT trial showed was safety. And he repeated that over and over. And so, patients hating steroids, he succeeded replacing the steroid use with that.

So you get this broad utilization of efgartigimod. The last two areas that is – remember in this trial, it’s a broad enrollment criteria. So we play all the way from second line down to the defined relapsed refractory patients and we also go into the broader set of patients because we included the serum negative patients in our trial.

So, to answer your question with one answer, yes, I think we will land into the MG space and then I think we will expand as physicians get comfortable. But remember here, that there is a brand new mechanism of action, of which most physicians in the U.S.

have never utilized and so it is going to be about education and getting them comfortable with it as we expand into that broader set of patients. .

And our next question today comes from Joon Lee with Truist Securities. Please go ahead..

Hi. Thanks for taking my questions and congrats on the progress. Just looking at the safety section of your presentation at a recent medical conference, infection rates are largely similar between the drug and the placebo.

But the drug arm does have a bit of a numerically higher value by about ten percentage points and for both placebo and the drug, they are between 30% and 40% ranges.

It appears to be a little bit high, but I am just not sure, is that typical infection rate for GMG patient population? And along that line, assuming there is a COVID-19 – a mass COVID-19 vaccination program on a global scale possibly in 2021, would that impact your commercialization strategy in anyway? Just wondering if you have – curious to know what the impact of efgartigimod would be on the immune system possibly eliminating some of the therapeutic antibodies that the body generates? Thank you..

Hi, Joon. Thanks for joining us today and I will pass over the second question to Keith in a minute, but in terms of safety profile, when you look at it, basically seeing – we see a safety profile which is comparable to placebo.

So there is no signal maybe you see in the medical difference that it is small numbers and basically, on none of the parameters we study, you see actually signal for physical infection.

And remember that these patients were onboard immunosuppressants already and some of which actually do suppress the immune system to the extent you may see some increased risk of infection anyhow. Maybe before I hand over to Keith that the mode of action of efgartigimod is to interfere with hiking of IgGs that not with the introduction.

We do not target B-cells. We do not target the ability of being top of those to produce IgG. We only inter field better systems.

And the splendid scientific news that are out there showing that within FcRn antagonist, you are basically not impacting the ability of the immune response to see and react effectively to an infectious agent and how we think about commercialization in a COVID-19 environment, maybe Keith, you are best placed to give us your comments on that. .

Yes. So, Joon, we are actually fully expecting that we would be launching this product in a COVID environment. And so, I am hopeful that we could even be in a cross-functional type of launch where it could be some live and some virtual. But we have been studying the launches.

Horizon has had a very successful launch here during COVID environment with an IV product and so we have been studying the launches and particularly how they are engaging with the healthcare professionals so that we can replicate that type of launch.

So, all I can tell you is, what I’ve said before, I am glad that we did not wind up launching in 2020, because there has been a great deal of learning and a great deal of adapting that the team has had to go through. .

Thank you. Our next question today comes from Lenny Van Steenhuyse with KBC Securities. Please go ahead. .

Hi. Good afternoon. And then, thanks for taking the question. I was also looking to circle back of it on the subcu formulation of efgartigimod and the FDA meeting you already touched a bit on the discussion and then, let’s say the impact of the biomarker-related data or not.

Perhaps, could you provide some additional info on the content of the meeting with what you can expect and then what the potential outcomes and then impact on the development trajectory for the subcu formulation would be. And perhaps relating to that, a follow-up question, subcu formulation is of course tied to the partnership with Halozyme.

What should we expect in terms of royalty out-payments to the Halozyme company themselves mentioned mid-single-digits on average for their deals? Is this also is the case for efgartigimod? Are there any specific fees on this deal? Can you comment on that please? Thank you. .

Thank you, Lenny. So, on royalties it didn’t gets – factored all in the deal making sure we are in the same ballpark in terms of royalties, actually identical and that means mid-single-digits. The strategies for bridging IV with subcu for the FDA meeting, we don’t basically to the details.

I think we just elaborated on the fact that this is going to be based on science. It’s going to be based on a very substantial datasets from our ADAPT Phase 3 trial. And of course, a growing safety database. I think we have the biggest safety database in this space – for efgartigimod.

So, expect a science-based conversation, expect a company this is ready to are you at benefit with, based on data and as we said before, we do anticipate some level of exposure needed in MG patients in order to effectively bridge from IV to subcu. But rest assured, that we will communicate as soon as we have the written minutes from the meeting.

Thank you. .

Thank you. Our next question today comes from Danielle Brill with Raymond James. Please go ahead..

Hi, guys. Good morning, and thanks for the question.

I know we have to wait to hear the – indication data next year, but curious given what we’ve seen with the success of Horizon’s drug in thyroid eye disease, what your thoughts on that opportunity and the potential role for anti-FcRn from the indication?.

Yes. Look, this is a long – there are many, many indications that this company evidenced that pathogenic IgGs actually drive the disease. I think TED is one of them. Actually, there is a whole cadence of recent publication as for the documenting that the pathogenic role of IgGs in this devastating disease.

And so, it’s one of the many indications where I think from a biology point of view it makes sense. I think it’s also benefited now that you know that the clinical and regulatory fact to approval in this indication.

And therefore, we do have this indication on our radar screen and how actually we look at prioritization of this indication is too early to discuss. But you are right, from a biology point of view, this could be an efgartigimod indication. .

Thank you. Our next question today comes from Jason Butler with JMP Securities. Please go ahead. .

Hi. Thanks for taking the questions.

Just the first one on ITP, obviously with the program you have ongoing you’d expect you have both subcu and IV formulations approved, but just wondering, when you speak to physicians in the context of the IV and the potential to switch patients at some to subcu, are there additional data or information that physicians will want to inform who the appropriate patients would be and how to do that? And then, just second question on PV, just if you could remind us with the rationale and the epidemiology of including the Pemphigus foliaceus population, as well in that program? Thanks.

.

Yes. So, Jason, I’ll start with the question on subcu IV in ITP. I just want to call out that these are two separate studies. One is going to be exclusively IV and the other one is going to be exclusively subcu. So, it will allow us to have a standalone advantage for patients with subcu. So they’ll have both induction and maintenance with subcu.

So there is not going to be a switching. When it comes to switching patients from IV to subcu, what I can tell you is in the discussions that we’ve had with our KOLs, this has been more around MG, mind you, than it has been ITP.

They’ve shared with us that when given the preference, still 30% to 40% of patients have elected to stay on IV therapy as opposed to subcu. They just simply do not want to inject themselves.

And finally, lastly, the point of switching from IV to subcu, we will have data on that in the future, because although we are waiting on our – we are waiting on the news from the FDA meetings, what we are not doing is standing still.

So, we are already working on some of our patients to come out of our open-label extension from ADAPT and look at potentially switching them to subcu so that we would have that type of information. .

Thank you. And our next question today comes from Matthew Harrison at Morgan Stanley. Please go ahead. .

Great. Good afternoon, thanks for taking the question. I guess, two for me. One, Tim, can you just comment, when you think about the IDT and you obviously thought confident enough to give guidance around timing now.

What do you view is still the risk with that timeline could slip or can you just contextualize for us what potential issues you could run into that would push that out further? And then, secondly, can you comment on the regulatory process in Japan? I am just wondering, how much clarity we have there once you file versus, say, a regulatory process in the U.S.? Thanks.

.

Thank you, Matthew. And we’ll back it. So, for CIDP, I think the enrollment is going swiftly as the fact. I think now the new COVID-19 exposure is that, for those patients who are on study that actually their ability to perform the visits would be impacted.

We have tried to mitigate against that as much as we could through a home administration of products and the medicines have still, there is some ability required for patients to go to site from time to time. So, it’s really during the stay on the study that we are – of course we have to be careful about the impact of COVID-19 on patient logistics.

With regards to the registration process in Japan, that’s a pretty well understood process.

I think we can really leverage to DLE and a filing and I think especially in the Q&A following the filing, there will be much more intensive Q&A, real-time Q&A, where I think it’s more technical complications which have to do with – for example, translation from Japanese to English and everything needs to be checked of course double.

And there is also a particular attention of the PMDA to all the aspects of the filing as compared to, for example it will be in originals. But I think it’s a process which is very well understood by us and by the team. And we feel very comfortable going into the process. .

Yes, Tim. Matthew, the only thing that I would add to this is, going through the process which is well understood, the only difference that you’ll see from that here in the – with the FDA is, once we have approval by the FDA, we have a price set and then we are – the product is available on the market.

In Japan, the difference is, you have approval from PMDA, and your product is approved and you are allowed to discuss it. But there is a three month period after that approval, of which you set price with Japan.

So, there is about a three month stretch between the actual approval and when you can actually make product available to patients and that’s because of pricing and that’s standard in the practice there in Japan. .

And our next question today comes from Douglas Tsao with H.C. Wainwright. Please go ahead. .

Hi. Good morning. Thanks for taking the questions. Just curious in terms of feedback you are getting from KOLs in terms of the individualized dosing and how they intend to implement it.

Do you get a sense that they are going to abate this on symptoms or they are going to be checking IgG levels? And I am also just curious, obviously, you have four week cycles.

Have you heard from KOLs that might be thinking about going with a four week induction of, sort of weekly treatment, but then, sort of maybe going with shorter cycles in subsequent periods with sort of different sort of intervals. Thank you. .

Yes. So, Douglas, first of all, the treatment with the individualized treatment, they are not going to be measuring IgGs to make their determination of when they re-dose a patient. What they have told us is, your individualized treatment cycle is, how I start a patient that I am going to treat with chronic IVIg.

I start them on a regularly scheduled dose, right, which would be our cycle with an interval and then they bring them back in and they evaluate them. As the patient is maintaining the response and doing well, they will continue to stretch that cycle out longer as time goes on.

As far as your second question about will they begin to customize the dose from the cycle? I think that they do this with every product available on the market. They create dosing schedules and don’t stay completely rigid. I am talking MG treatment. They don’t stay completely rigid to what the package insert says and their intervals on dosing.

So, we do get questions like that from KOLs and in fact, if you take a look at the data that Tim shared, the individualized dosing, what it really is going to allow us for some patients to have very few cycles per year and other patients, you may see physicians decide to take them with more of a chronic dose that could be administered.

So, they have the questions, because there is no two patients that are the same in MG. .

Thank you. And our next question today comes from Graig Suvannavejh with Goldman Sachs. Please proceed. Pardon me, Graig. Your line is open. .

Yes. Thank you so much. Thanks for squeezing me in. A bigger picture question, maybe for Tim, and Keith, maybe you can comment too. But, over the quarter we’ve seen competitive landscape developments, Phase 2 data for immune events MG program, also the ITP Phase 2 data from UCB.

Just wondering, bigger picture, how you think about how the competitive landscape is shaping and obviously given J&J’s acquisition of Momenta, just broad strokes on how you think the FcRn competitive landscape is shaping up? Thanks. .

Thank you, Graig. Maybe I will start and then I will hand over to Keith to fill in on probably some of the more commercial aspects. But, I think there is one thing becoming very clear is, Graig, that is that not all FcRns are made equal. So, I think we see clear baskets of clinical profiles.

I think IgG4 antibodies clearly have a different efficacy and safety profile from the glycosylated IgG1 antibodies, which typically come with less side-effects and then I think we are uniquely positioned with the fragments. I think it’s fair to say that, of course, we have the largest and most advanced dataset of all that we took the bar very high.

Typically, we like to think about differentiation along with the factors of efficacy, safety and convenience. I think on the efficacy side, we put forward data from ROC studies now, which basically put down an unprecedented efficacy, we haven’t seen anything which is coming close to that from the smaller Phase 2 datapoints we saw from competition.

And I think on the safety side, again a unique position.

And I think it’s very early of course to talk for some of the other molecules that I think the ADAPT study and especially the open-label extension, where we now have patients on drug for up to two years and I think an impressive point we just suggest you now, pretty clean safety and tolerability profile going forward with again a key differentiator being the fact that we do not induce any drops in serum albumin.

And then, I think on the convenience side, as Keith already called out, we think it’s important to have both on IV and the subcu products available in the U.S.

markets, there is a need for both and I think the Halozyme technology is again putting us in a very nice starting position for that single fast subcu injection, not to be confused to this more lengthy and more cumbersome, for example subcu infusion.

And Keith, maybe you feel free to start any if you feel what we are looking any important points?.

No, I think, Tim, you’ve covered it from those three points. The only thing that I would add, Graig, is that, we believe that the total states for FcRn is so much bigger than just the four indications that we currently have made public to you.

And because of that, actually, other competitors will help grow the FcRn state, we believe more rapid than just what we could do by ourselves. So, we love the position that we are in. We love the product that we are going into this space with. But ultimately, competition can benefit all of us. .

Thank you. And ladies and gentlemen, this concludes today’s question-and-answer session and today’s conference call. We thank you all for attending today’s presentation. You may now disconnect your lines and have a wonderful day..