Good morning. My name is Lydia and I will be your conference operator today. At this time, I'd like to welcome everyone to the Blueprint Medicines’ Fourth Quarter and Full Year 2021 Financial Results Conference Call. [Operator Instructions] Thank you. Kristin Hodous you may begin your conference..

Thank you, operator. Good morning, everyone, and welcome to Blueprint Medicines fourth quarter and full year 2021 financial and operating results conference call. This morning, we issued a press release which outlines the topics we plan to discuss today.

You can access the press release as well as the slides that we'll be reviewing today by going to the Investors section of our website at www.blueprintmedicines.com.

Today, on our call, Jeff Albers, our Chief Executive Officer; and Kate Haviland, our Chief Operating Officer, will discuss Blueprint Medicines' fourth quarter 2021 business highlights; Christy Rossi, our Chief Commercial Officer, will provide a commercial update; Fouad Namouni, President, Research & Development, will review our recent clinical progress and highlight upcoming milestones across our growing portfolio; and Mike Landsittel, our Chief Financial Officer, will review our fourth quarter 2021 financial results.

Our Chief Medical Officer, Becker Hewes; and our Chief Scientific Officer, Percy Carter, are also joining our call and will be available for Q&A. Before we get started, I would like to remind everyone that statements we make on this conference call will include forward-looking statements.

Actual events or results could differ materially from those expressed or implied by any forward-looking statements as a result of various risks, uncertainties and other factors, including those set forth in the Risk Factors section of our SEC filing.

In addition, any forward-looking statement made on this call represents our views only as of today and should not be relied upon as representing our views as of any subsequent date. We specifically disclaim any obligation to update or revise any forward-looking statements. Now here is our CEO, Jeff Albers..

Thanks, Kristin. And thank you everyone for joining the call today. In the fourth quarter, we continued to make progress toward expanding the impact of our precision therapies for patients with systemic masto cytosis and lung cancer through our commercial, research and development efforts. This was particularly notable in four key areas.

First, we continue to advance the U.S. launch of AYVAKIT in advanced systemic masto cytosis, with revenue growth driven by a broadening base of prescribers.

Combined with the future plan launch in non-advanced SM, which will be supported by data from our PIONEER trial expected mid-year, we continue on the path to realize a potential blockbuster opportunity.

Second, all three of our EGFR programs, as well as our CDK2 program will be in the clinic this quarter, setting up a string of clinical data sets over the next 12 to 18 months. This wave of updates will begin with early clinical data from our SYMPHONY trial of BLU-945 at the AACR meeting in April.

Third, we're making progress in bringing our therapies to patients around the world, including in Europe, where we recently received a positive CHMP opinion for AYVAKIT in advanced systemic masto cytosis.

Altogether, we now have marketing authorizations or applications under review for AYVAKIT or GAVRETO in more than 50 countries supported by our strategic partnerships.

And fourth, as we execute on our near-term vision, we're also putting into place drivers of long-term growth, including new research capabilities focused on targeted protein degradation and exciting precision medicine technology that beautifully compliments our current kinase platform.

All these activities create opportunities for growth in 2022 and beyond. And we have the right team in place to seize them. And finally on a personal note, and as we announced last month, I plan to transition my role to Executive Chairman in April.

I came to the decision after thoughtful consideration and succession planning with our Board, and I'm excited to make room for Kate Haviland and our exceptional executive team to expand their leadership of the company. I'm tremendously proud of what we've achieved over the last eight years.

And I remain deeply committed to driving the success of Blueprint Medicines as Executive Chairman through the end of this year and then in a Non-Executive Chairman role thereafter. Now, let me turn the call over to Kate to make some brief remarks before we jump into our business updates.

Kate?.

Thank you, Jeff. And good morning, everyone. I'm incredibly honored to become Blueprint Medicines’ next CEO. And I'm grateful to Jeff, the Board, our executive team and our employees for their confidence.

Over the last six years as Chief Operating Officer and Chief Business Officer, I worked closely with Jeff and our team to bring our first medicines to patients, to grow an industry-leading portfolio of best-in-class precision therapies and build fully integrated the global company we are today.

Over this time, I've had many opportunities to experience the impact that we at Blueprint Medicines have had on the lives of the patients we have touched and the lives of their families and the people that love them. These experiences have been tremendously rewarding for me.

As I step into the CEO role, I'm driven to expand our reach to many more people around the world who are look to us for hope – in hope of a better future.

We will do this from a position of strength as we continue to execute our portfolio strategy, which has served us so well and continue building on our culture of excellence with a team that is passionate and committed to continuously driving and delivering medical innovation to patients.

We have the foundation in place to dramatically increase our impact on patients and on the field of precision medicine this year and beyond. With that, let me turn the call over to Christy to review our commercial performance.

Christy?.

Thanks, Kate. Good morning, everyone. Let me begin with AYVAKIT performance. Total AYVAKIT net product revenue was $53 million for the full year and $20 million for the fourth quarter, representing approximately 150% year-over-year growth. From Q3 to Q4 revenue from advanced SM grew approximately 55%.

And advanced SM is now the primary driver of AYVAKIT revenue overall. This growth was supported by the broad base of prescriber and account experience that we continue to build. In the fourth quarter, approximately 80 new prescribers or accounts utilized AYVAKIT for the first time.

We're pleased to see that about half of our volume is coming from community prescribers with adoption across all advance disease subtypes, roughly in line with the real-world patient population. In addition, we continue to see strong patient access to therapy and a rapid time to fill prescriptions.

Patient utilization of free drug through our Patient Assistance Program continues to trend in line with our expectations of approximately 30%, consistent with the payor mix across our indication.

With this solid foundation, we see a pathway for growth akin to other first-in-class rare disease launches, such as Jakafi, which was first approved for myelofibrosis in 2011. Through steady growth over the course of its lifecycle, Jakafi has become a blockbuster product.

Similar to our expectation for AYVAKIT in non-advanced SM Jakafi's approval for the larger PV indication was an inflection point that accelerated its growth trajectory. This brings me to our AYVAKIT guidance for 2022.

As we noted in our press release this morning, we expect to more than double AYVAKIT revenue over 2021 to achieve $115 million to $130 million in AYVAKIT net product revenue this year.

Key drivers of our performance will be growth in new patient starts and increasing treatment duration, which we anticipate will drive acceleration in revenue, particularly as we approach the second half of the year.

We expect to see growth new patient starts as we continue to broaden our prescriber base and increase our penetration into already diagnosed patients, as well as the estimated 300 to 450 addressable advanced SM patients who are newly diagnosed in the U.S. each year.

As with other rare disease launches, we are leveraging data in innovative ways to evolve and adapt our targeting in real time, enabling our field to educate the right providers at the time they are most receptive, which is when they may have a potential patient in their care.

This is proving to be an effective approach to reaching providers in both the academic and community setting. We also anticipate that the improving COVID landscape in the U.S. will aid our efforts to increase patient identification and treatment with AYVAKIT. We know that the pandemic has impacted patient care in hematology and oncology in many ways.

For example, we've seen ebbs and flows in the number of advanced SM diagnoses observed in claims data roughly in line with COVID trends. We’ve also noted that only about half of advanced SM patients visited a hematologist in 2021. We are seeing science from our field of improving access in some geographies that are further past the Omicron peak.

In totality, we expect the combination of our own education and targeting efforts, as well as an improving external environ to drive growth in new patient starts throughout the year. In addition, we anticipate that longer durations of therapy will be a key driver of AYVAKIT revenue growth.

In our advanced SM clinical studies, the average duration of treatment with approximately two years. In a real-world setting, treatment durations often trend low at launch and then improve over time as patients are treated earlier in their disease course and we expect this to be the case with AYVAKIT as well.

Over the first two quarters of launch, the majority of our treated patients have been later in their disease course with only 20% newly diagnosed in 2021. By the end of 2022, we expect newly diagnosed patients could comprise half or more of our new patient starts.

Overall, the insights we have gained over the first two quarters of launch, reinforced my view that SM is a potential blockbuster opportunity for AYVAKIT.

We're encouraged by the growth we are seeing in the diagnosis of SM in the United States over the past several years with now an estimated 14,000 unique diagnosed SM patients visible to us in claims data. We believe that healthcare provider and patient education and improved testing infrastructure will continue to drive growth in diagnose patients.

As we approach the readout of pioneer mid-year we will continue to focus on launch execution and advanced SM, as well as increasing disease awareness and diagnosis in non-advanced disease. And I'm excited about the opportunity in front of us. Let me now turn to GAVRETO. We expect to see global revenue growth driven by expansion of the U.S.

market and multiple launches outside the U.S. led by Roche and CStone Pharmaceutical. U.S. quarter-of-quarter dynamics were impacted by our transition to the Genentech distribution model in Q3 and a flat overall RET market in terms of new patient starts in Q4.

In 2022, we will continue to focus on leveraging Genentech's infrastructure to drive patient identification and provider education to grow the overall RET opportunity and GAVRETO share.

Overall, I'm excited about the road ahead for Blueprint in 2022, as we look to more than double AYVAKIT revenue through the ongoing execution of the advanced SM launch and prepare for our anticipated launch in non-advanced SM. On that note, I'll turn the call over to Fouad to review our R&D progress..

Thanks, Christy and good morning, everyone. Today, I'll provide updates focused on three areas. Our continued clinical progress, plans to present new data at the AACR Meeting, and ongoing efforts to expand our research platform. Let me begin with a few important clinical updates.

First, as announced earlier this quarter we completed enrollment of more than 200 patients in our PIONEER trial of AYVAKIT in non-advanced systemic mastocytosis. And we are on track to report top-line data mid-year pending results. We plan to submit an sNDA to the FDA by the end of 2022.

For our EGFR program we were pleased to dose the first lung cancer patient in our HARMONY study of BLU-701 in January. In addition, we received the clearance from the FDA to study for BLU-451, our EGFR Exon 20 inhibitor acquired from Lengo Therapeutics.

We also received FDA clearance to begin a study of BLU-222, our CDK2 inhibitor in patients with breast and ovarian cancers, as well as other Cyclin E aberrant tumors.

Last week, we were encourag to see Pfizer report data for their CDK2 inhibitor showing tumor reductions in two breast cancer patients, providing evidence for CDK2 inhibition and reinforcing our excitement to bring BLU-222, which has the best-in class-potential into the clinic.

Now, let me turn to our plans to present new data at the AACR Annual Meeting in April. I am pleased to share that we have multiple abstracts accepted for presentations. These include preclinical data for BLU-451 and BLU-222, as well as the first clinical data for BLU-945 in patients with lung cancer.

BLU-945 is highly selective over wild-type EGFR, a feature that supports its combined ability with other agents and is uniquely potent against Triple Mutant EGFR lung tumors. Our EGFR strategy leverages the synergy and complement between 945, 701 or other EGFR agents to cover the majority of EGFR mutations in lung cancer.

This will allow us to address acquired resistance in second and third-line following osimertinib treatment and prevent it from emerging in the first-line setting. We initiated the SYMPHONY study of BLU-945 in mid-2021 and today we are about halfway through the dose escalation.

So far we are very encouraged to see that BLU-945 is performing consistent with our pre-clinical data. In addition, we are gaining tremendous insight into disease heterogeneity and tumor mutational profiles through the monitoring of circulating tumor DNA, which will inform our development of combinations.

Our presentation at AACR will highlight initial data from the first dose escalation cohorts of the SYMPHONY Phase 1 study, and will include safety, pharmacokinetic and translational data as well as early signals of clinical activity. Now let's shift gears to highlight our research efforts.

One of the most important factors that drove my decision to join Blueprint Medicines was the quality and productivity of our scientific platform and team. In just 10 years we have brought forward 10 drug candidates, two of which are now approved around the world. This is an incredible accomplishment for a company of our size and age.

Over the last year, when we've taken steps to build on the strength and diversify our discovery strategy, with the goal of further expanding our ability to deliver transformative therapies to patients. As part of this effort, we are adding capabilities to enable the design of targeted protein degraders in precision oncology and hematology.

Targeted protein degradation is a therapeutic approach that harnesses the body cellular machinery to degrade unwanted proteins. Our implementation of this approach will fully capitalize on our annotated chemical library and new target discovery capabilities.

The incorporation of targeted protein degradation as part of our research strategy will optimize our ability to succeed with challenging kinases, provide pharmacological compliment to kinase inhibition for traditional kinases, and open approach to additional target classes.

We are now building internal targeted protein degradation capabilities, which will be supported by selective partnerships and sourcing of external innovation. Based on this expansion and our overall research plan we believe we will be able to roughly double the historic output of our discovery engine by 2025.

This represents an exciting area of growth, and we look forward to sharing more on our vision later in 2022, including at our planned R&D day in the second half of the year. With that, I'll turn the call over to Mike to review our financial updates..

Thanks Fouad. Earlier this morning, we reported detailed financial results in our press release and for today's call I'll touch on a few highlights from the year and the quarter.

For the full year 2021 total revenues were $180.1 million, including $57.7 million in net product revenues from the sales of AYVAKIT and GAVRETO, in $122.4 million in collaboration revenues, which is in line with a revised 2021 revenue guidance of $170 million to $180 million.

In addition, as Christy noted, AYVAKIT product revenues grew approximately 150% year-over-year to $53 million in 2021. Off these revenues $20 million of AYVAKIT net product revenues and $87 million in collaboration revenues were recorded in the fourth quarter.

For AYVAKIT, we saw solid growth in advanced SM, which is now our major driver of product revenue. In addition, we achieved important progress through our collaborations including the approval of GAVRETO in Europe, as well as growing royalty revenues on the sales of GAVRETO and AYVAKIT by CStone Pharmaceuticals in China.

In addition, we were pleased to sign a strategic collaboration with Zai Lab to develop and commercialize BLU-945 and BLU-701 in Greater China, which included a $25 million upfront payment that we also recognized as revenue in the fourth quarter.

Our total operating expenses for the full year and fourth quarter were $822.1 million and $423.2 million respectively, primarily driven by a one-time charge of $260 million associated with our acquisition of Lengo Therapeutics.

This acquisition was completed in December and since that time we have rapidly integrated BLU-451 and the company's other research assets into our portfolio.

As we enter 2022, we are in an exceptionally strong position with just over $1 billion in cash, which will enable us to invest in our portfolio as we drive towards a range of data catalysts over the next 12 to 18 months with potential to create transformative value for patients as well as our shareholders.

This year, as our business continues to mature, we are providing more detailed revenue guidance. For 2022 we anticipate that we will achieve $180 million to $200 million in total revenues, which includes approximately $115 million to $130 million AYVAKIT net product sales.

This guidance highlights our expectations for both a continued diversity of revenue source, as well as significant AYVAKIT product revenue growth.

We anticipate that our performance will continue to drive our financial strength, which combined with our advancing portfolio and prolific research engine uniquely positions us to thrive over the course of 2022 and the years ahead. With that, I'll now turn the call back over to the operator for questions.

Operator?.

Thank you. [Operator Instructions] Your first question comes from the line of Marc Frahm of Cowen. Your line is open.

Thanks for taking my questions. You could start with for the 945 data updated AACR, so completely understands it's going to be very much a work-in-progress of a dose escalation.

But in terms of preliminary efficacy signal, can you give some context to maybe how many patients that are truly cyst triple-mutant patient are likely to be kind of in the presentation and to the extent that's going to be very early at AACR.

When might we see robust enough populations to kind of really determine single agent efficacy there?.

Thank you, Marc. So for our 945, I think the way we look at it is, so what do we want to see from 941 agent that was designed with some specific features in mind. Number 1 confirmation of the wild-type EGFR selectivity. So in safety profile that allows a large therapeutic index and combinability with other agent.

Number 2, I think we would like to see coverage of the mutational profile that was designed for all these mutations. Number 3, we would like to see a chemical activity in tumors that are harboring mutation that 945 was designed for.

So today the study is in midway through the dose escalation and as I mentioned earlier, we're happy to see that the pre-clinical profile is, the clinical profile is consistent with the preclinical profile.

We are learning a lot from looking at tumor ctDNA in terms of the heterogeneity of the disease and the mutational profile of these tumors sometimes even within a single patient that is really informing very importantly our strategy for combinations of EGFR agents in the disease. So we'll present data from the first dose escalation cohorts.

I don't have specific number of patients yet at this point, but we'll present data from the first and third dose escalation cohorts and we'll show safety data, BJ [ph] data, translational data, ctDNA data and namely, and more so some early clinical signs of tumor activity.

We have not selected patients in this study based on their mutational profile, but we included for the purpose of dose escalation Phase 1, all EGFR mutated patients, but we are providing all the tumors we have, and we'll be able to show that within subgroups of patients and the data we will have by that time..

Okay. Thanks, very helpful. And then maybe Christy your comment about kind the ASM market building and AYVAKIT sales building up, and maybe accelerating as we get into the second half of the year.

Is that acceleration entirely driven by ASM, or are you also assuming the pioneer trial is positive thus assuming there will be some level of off-label use kind of coming in, in advance of a label update?.

Sure. So we are, I am assuming that the pioneer study will be positive. But we are not factoring true off-label use as a primary driver.

It's more, the factors that I mentioned earlier in terms of – we see a lot of headroom to continue to grow new patients starts to the year as we in part begin to penetrate into newly diagnosed patients and then expects increasing treatment durations to be another factor.

I do think pioneer positivity will provide nice additional sort of just surround sound in terms of advanced SM, AYVAKIT et cetera. So there's definitely some, I think benefit from the study being positive.

But we're really looking at advance SM being a primary driver of AYVAKIT sales this year and then of course anticipating the launch and non-advance in that larger opportunities we get into next year..

Okay. Thank you..

Thank you. Our next question today comes from Dane Leone of Raymond James. Please go ahead. Your line is open..

Hi, thank you for taking the questions and congratulations from all the progress. Kind of a similar line of questioning, I guess I'll ask, a lot of the conversations we've had with investors heading into the first data 9.5 has been trying to understand what the context is given the teams disclosed that.

You're not expecting to have a recommended Phase 2 dose being established by the presentation.

Now several things with biology, the drug that you mentioned Fouad, do you count any patient with a T790M mutation as being potentially able to benefit from the drug whether or not there's a co-mutation of C797S, which would open it up to maybe a broader patient population of clinical activity? And then when you think about how you frame early clinical activity, there's obviously a wide range of interpretation.

And if the goal is to establish a lower bound in the therapeutic index at AAGR presentation, which I think you're trying to do, does that mean we think about clinical activity more in the framework of disease control rate or actual resist responses? Thank you..

Thanks Dane. The data that we will be presenting is from the very first escalation cohort, as I said we are in midway through the dose escalation.

We expect to reach an RP2D to your point around sometime mid-year and at that time, at that expansion time would be able to generate typical response rates and then specific activity for the monotherapy and by that time also, the combination with osimertinib would be up and running.

In terms of the data, what it means in terms of response rates and what is the activity? As I mentioned; one, we really need to make sure that what we are seeing in terms of safety and therapeutic index is consistent with the design of the molecule.

This molecule was mostly designed to be combined with other agents like 701 and osimertinib and others. Number two is the covers of the mutation that the molecule was designed for, so drivers and TM and CS.

When we talk about signal of activity, it' really about seeing, are we seeing some tumor shrinkage in some specific instances and patients? And I don't think that with the amount of data that we will be presenting, which is from the first cohort that we'll be able to get into stable disease rates and response rates, because it's too early.

I think we'll have the opportunity to do it at that later when we have the RP2D and when we have the – an extension to the Phase 2 and really define specifically what the response rates are.

And lastly, I would add one important thing in this dose escalation, are we learning enough from the dose escalation that we feel comfortable starting very quickly a combination with osimertinib as an example? And I would say probably yes, and that's very important because we will be also not looking only at monotherapy in the expansion phase, but we'll be looking at combination with second, third-line in mind and also first line in mind too..

Thank you.

Could you just clarify the one, the last part of that question of whether you expect this drug to be active when you say in line with preclinical modeling, given that T790M is the required hook for the compound? Do you see expect activity in that patient population regardless of the C797S mutation, or is it really both those co-mutations existing being important to the drug activity?.

Thank you for the question. What we are learning from the Phase 1, tumor is heterogenic and there is multiple mutational profile and this is really helping our combination development strategy. On the other hand to your point for monotherapy, we will look whether we have activity in triple mute in CS double mutant.

I think it's too early at this point, in terms of dose escalation, we would like to see activity across the range of mutation that are covered by design by 945..

Yes. Hi. This is Becker. Just a little bit more detail on that. I wouldn't classify T790M as the hook for the molecule. That is a mutation that optimizes the activity of it, but this molecule has a very large winded wild-type, and there is potential for broader activity of it beyond just protein for T790M.

And then with respect to the establishment of stable disease as a end point, we are looking for responses and the tumor heterogeneity means that sometimes we expect to see that with monotherapy and that would be lack of heterogeneity, but there might be these situations where a combination is optimal to cover all the mutations at once.

And that's really the strategy in the frontline where you want to prevent the development of the mutations rather than waiting until they're established and try and get in front of them once they've gotten a biological hold..

Excellent. Thank you very much..

Thank you. Our next question today comes from Brad Canino of Stifel. Your line is open..

Hey, great. Thank you for the question. And I guess to extend the, a conversation on 945, based on all that you said through it on, on the tumor scan data that you'll have, and even a possible heterogeneity within these triple mutant patients.

Will you be providing changes in ctDNA over treatment with BLU-945 and would something like that be the better measure to assess the PD in early clinical activity to support the movement into combinations as well as the safety? Thank you..

Thank you, Brad. We in fact we have been capturing ctDNA, evolution for the majority of our patients and we'll be reporting that data to your question, showing the impact on the variation over time of ctDNA burden for specific EGFR mutation.

When patient are treated with 945, it is a good pharmacodynamic and surrogate marker for what could happen at the tumor level, obviously to Becker's point activity from the clinical side for the monotherapy would like to see tumor shrinkers and responses in patient.

But I agree with you, point that ctDNA is a very strong pharmacodynamic and surrogate marker for the activity of the compound..

Great. Thank you..

Thank you. Our next question today comes from Salveen Richter of Goldman Sachs. Your line is open..

Hey, good morning. Thanks for taking the call. This is Matt [ph] on for Salveen. Just two quick questions.

Do the trends you're seeing with respect to uptake in advanced SM and the role out there change you way, how you're thinking about a potential launch in ISM? And then secondly, you've already talked about this a little bit, but for the upcoming SYMPHONY data, what would be considered positive in the context of patient heterogeneity? Thank you again..

So I'll start with the first question. So, I do think we're learning a lot as we go through – go through this launch. I think a lot of the insights are primarily around how we can hone targeting in a rare disease market where clearly being at the right place at the right is, is so critical to help identify and move patients onto treatment.

I don't think advance SM trajectory we've seen, if anything just sort of reinforces my, my view of the broader opportunity. This is a rare disease market. We've known that kind of building, disease awareness, facilitating diagnosis, making sure that patients are able to be offered effective treatment.

Like those are the key building blocks and that's true in advance SM as much as it is in non-advanced. I think as we've gotten into this market and interacted with healthcare providers, it's been encouraging to hear about the non-advanced patients that are interested in having an effective treatment available to them.

And also just encouraging to see what we see in the data in terms of the growth in the diagnosed SM population in the U.S. overall. And I think that's a really encouraging trend. It's certainly something that we're working very hard to help support.

And that will be, I think really critical and something we expect to sort of continue develop over time to drive the overall opportunity for AYVAKIT in this indication..

And for the tumor DNA, secluding tumor DNA and heterogeneity and what is positive and what is not.

I think just step back a little bit and think about now that we have access to circulating tumor DNA, we are able not only to see what type of tumor or what type of mutation, but also the number of Crohn's that are composing in a given tumor in patients.

That is difficult to do when we are only focusing on one biopsy at the tumor level, in the primary or in the metastasis. So ctDNA give us really a very good picture on what – how the tumor has evolved over just multiple lines or even in earlier lines and what it means in terms of its multiple mutational profile.

And what we would like to see is when we are really focusing on this pharmacodynamic and surrogate mark-up telling us what's happening at the tumor level, when we treat the patient with a given molecule is really the change in the burden of that type of creating tumor DNA over time.

And what clone and what type of mutation are we targeting that are changing for a given patient.

So it is an extremely helpful, and I do believe the use of this way for drug development overall will really revolutionize the field in terms of knowing what medicine is doing, knowing what to expect and what to really predict over time in terms of activity, but also in terms of what are the variety of combinations that you can deal with to tackle this tumor.

And you can know it very early in the process, even before reaching doses at which you are going to Phase 2s or at which you are clinically impacted..

Great. Thank you very much..

Our next question comes from Reni Benjamin of JMP Securities. Please go ahead. Your line is open..

Hey, good morning guys. Thanks for taking the questions and congregations on a great quarter. My question mainly is around the PIONEER results that we're expecting by the middle of this year.

Can you just remind us the primary and secondary endpoints and kind of where I'm going with this is whether or not COVID has the potential to impact the assessment's symptom scores? And I know fatigue is a big component, is there any way to kind of segregate I guess patients who may be vaccinated and un-vaccinated? How do you account for things like booster shots and how patients might be feeling at the time and still need to fill the total symptom score? Just how you might be taking into account the kind of changing things that are happening obviously in the world today? And I guess whether or not secondary endpoints might ultimately be able to use since it's more subjective as an approvable endpoint.

Thanks..

Sure, excellent.

Becker, why don't you take that?.

Sure. It's a really good question thinking about COVID and I'll just remind you, this is a randomized blinded trial. So, if there are effects, we will see it on both arms. We do collect the data on whether patients have had COVID and vaccine status, so we'll be able to deconvolute some of that data.

The primary endpoint, I'll remind you, is the patient reported outcome, but we are also looking at objective measures of disease as well and specific domains, so we can capture benefit that goes even beyond the amalgamated score, the Total Symptom Score. So, we'll continue to look at that.

There are other things like we've been through – we would have gone through a flu season, so this is the kind of thing that we would need to capture anyway. So, we've got that all built into the trial..

Great. Thank you..

Thank you. Our next question today comes from Mike Ulz of Morgan Stanley. Your line is open..

Hey guys, thanks for taking the question. Maybe just one on AYVAKIT in Europe. Now that you've got the positive CHMP opinion for advanced SM, can you talk about the launch strategy in Europe and maybe how the market might be different than in the U.S.? Thanks..

Sure. So yes, we are very pleased to get the positive opinion and we're looking forward to making a kit available in Europe in this half of the year and that launch beginning to also contribute to topline revenue growth as we go forward.

Our strategy in Europe is similar to the strategy in the U.S., which is that we're really taking a focused approach to build an organization that is right sized for the advanced system opportunity. Clearly, in Europe you have the cadence of countries coming online from a pricing and reimbursement dynamic, that's a little bit different than the U.S.

And so, what we expect is that some of those faster markets and in particular Germany will be kind of the key driver early on. And then as we continue to secure pricing and access along the timelines, we'll see some of the other markets come online. One thing, I think, is interesting about Europe versus the U.S.

is that in some ways the SM market is perhaps a bit more mature, particularly in markets like Germany, there's something called the ET&M, which is an organization that's been quite active driving innovation in terms of advanced system treatment, patient registries, et cetera. And so, there is a community of practice in place in Europe.

And we're highly engaged with that community. Many of the key members have been investigators of ours, et cetera. So, I think there's a lot of enthusiasm for the upcoming availability of AYVAKIT. We're looking forward to that this year..

Great. Thank you..

Thank you. Our next question today comes from Eun Yang of Jefferies. Your line is open..

Thank you. I have a question on EGFR inhibitors.

So, when you think of combinability of BLU-945, either with osimertinib and BLU-701, I know you got around the trial and see the data, but based on the preclinical of data and what you have seen, can you kind of comment on what do you think would be the best strategy? And also, what could be the kind of a potential advantage with combining with the BLU-701 compared to osimertinib.

Thank you..

Thank you. Very good question. As I mentioned, as we are learning about tumor heterogeneity, we believe in order to reach the majority of patients with EGFR mutant that are either showing progression after or osimertinib, or even in the earlier lines, combination of EGFR agents together is important.

And the way we have design line for five was deliberate and our intention was to really have it very, very selected over wild type EGFR so we can really have it as a key component for multiple types of combinations. So, the combination with osimertinib is supported by preclinical data, or strongly supported by preclinical data.

And we will look at it in patients who are progressing after osimertinib and see if the addition of BLU-945 will at least induce activity and responses in these patients and hopefully help them with their disease.

We will be covering when we combine all these two agents, the majority of the mutational combination that you can see in some subclones in the tumor.

BLU-701 in a similar way just started at the Phase 1, so we will have to reach the level where we can start combination studies and it will bring a very strong coverage when combined with BLU-945, including some discrete, multiple mutated subclones that really will be a good addition for BLU-701. Obviously, BLU-701 does not cover TM.

TM cover will be brought by BLU-945 to BLU-701 that really will constitute a very strong combination.

My expectation from both combination with osimertinib and BLU-701, this is the most important and only way to be able to cover the majority of patients that are resistant to osimertinib and even in first line to prevent the resistance from occurring..

Thank you..

Thank you. Our next question today comes from Joel Beatty of Baird. Your line is open..

Hi, thanks for taking the questions. And congrats on the progress.

First question is on the PIONEER study results expected in non-advanced SM, what's important for physicians to see in these results from your discussions with them, just the primary endpoint, or are there important secondary endpoints to them? And then second question is just, could you describe what you might expect from the trajectory in expenses over the course of the year?.

This is Becker, I'll take that. Let's think a little bit about the TSS score. So, this is a Total Symptom Score that we have designed in collaboration with regulators and with experts in systemic mastocytosis to capture many different ways that the disease manifests.

So, there are some patients who have a predominance of diarrhea, and some of rash and then others that have a lot of different symptoms that add up to a very high score. And so, we will look at the total score and also at the sub domains to better understand when patients are benefiting in ways that aren't captured by just that total score.

So that'll mean we're looking at the way that a patient with a 30% reduction best responds or best benefits.

And then we'll also look at patients with lower reductions who have a large change in their quality of life, because, for example, one symptom that stops them from going to work or keeps them from spending time with their family is meaningfully reduced. So those are the components of the TSS score that we'll be looking more deeply into.

Then there are also objective measures of disease. So, we look at reduction in tryptase, reduction in mast cells, reductions in the mutant allele burden and all of these will tell various aspects of the story that describe the benefit of treatment with AYVAKIT in this really varied patient population with a tremendous impact on their quality of life.

The other things we'll be looking at will be use of concomitant medications and really just their ability to return to what we're thinking of the normalcy.

These patients don't have a normal life, they've in some cases been living for 20 or 30 years with what they might call a new normal, which is not going out, not going to work, and we'll be looking at their return to normalcy in the scores and in the objective measures of response..

And Mike do you want to take the second half?.

Yes. So, with respect to the operating expense kind of trends, we're expecting to see, so first, as you saw in Q4, we had a large one-time charge of $260 million related to the Lengo acquisition. So, adjusting for that, I think, the best way to think about it is continued quarter-over-quarter modest OpEx growth driven by R&D, right.

As we think about BLU-701 in the clinic, BLU-222 in the clinic, we’ll be putting BLU-451 into the clinic. As those ramp up you could expect to see development expenses increase throughout the course of the year. But we expect it to be at a moderate pace, similar to what we've seen in historic quarters over the past year or so..

Thank you..

And maybe this is Jeff, I'll add to that. It's an interesting moment. We talk about being in a strong financial position but that becomes all the more noticeable in a tough market what we're seeing, we're all seeing in biotech.

And that's, I think, what drives our collective enthusiasm for Blueprint right now, is that we've got the blend of the strong financial position, underlying an expanding pipeline of programs in the clinic and expanding set of opportunities pre-clinically, and now this driving growth in revenue anchored around ASM and then moving into the noninterim SM position.

So, it's that total perspective, which I think, sometimes gets lost in the minutia of questions about a specific clone that Blueprint Medicines has never been stronger than it is today. And the differential of our strength, vis-à-vis the market, has never been stronger..

Thank you. Our next question today comes from Michael Schmidt of Guggenheim. Your line is open..

Hey guys, thanks for taking my question. I had a commercial one as well, so just thinking ahead of the potential launch in non-advanced systemic mastocytosis. And as we sort of look into this opportunity, I guess what are possible proxies perhaps that could serve as an example of a product launch in that type of market? Thank you..

Sure. So, it is interesting, right, we do a lot of looking at analogs, there is no perfect analog for SM. I mentioned Jakafi is one in the transcript, which I think is interesting, particularly because of the interplay between myelofibrosis and PV as sort of a more defined indication than leading into a broader one.

When we look at market evolution, I think, looking at, for example, HAE is a market that, I think, has some similarities in terms of sort of building and that shape of curve. Certainly, if I look at the trajectory of some of Alnylam’s brands, I think, there are some similarities too.

So, when I think of analogs, it's a defined patient population, rare disease perhaps diagnosis having been historically a challenge, but then having a therapy that's really effective that can help you catalyze growth in patient diagnosis and identification, and kind of building those treatment referral patterns, et cetera.

So, as I said, we're excited about some of the trends we're seeing in terms of continued growth in diagnosed patients is something that we think is going to be really important to continue to drive as we go forward.

And then we'll look to really catalyze education about AYVAKIT as being the first truly, potentially transformational therapy that addresses the driver of this disease, which is so impactful for patients..

All right.

And, then in non-advanced Mike, I think, you had disclosed some estimates before, but remind us just how many patients you believe might be immediately addressable, i.e., having been diagnosed and are being treated today as opposed to building the market over time?.

Sure, yes. So, I look at how this has actually evolved over the last couple of years, even as our own understanding of the market has deepened and as our engagement with the SM community has, I think, continued to deepen and evolve the market. So, we see 32,000 patients in the U.S. about 75,000 in major markets.

Historically, we had talked about sort of thinking about a third of patients being diagnosed and a third being sort of missed diagnosed, and another third completely, still making their way towards some kind of a diagnosis. Now, we see about 14,000, so nearly, approaching half of patients being diagnosed.

Our first kind of, I think, patient population that will really be candidates for AYVAKIT will be patients that are thought to be more moderate to severe. In our trial we're defining that with a TSS threshold. That's not something that's used in clinical practice.

So, in reality, I think, patients will seek care who are struggling with the burden of their symptoms and not well controlled on therapy. And we actually know that in fact, patients with TSS scores that are lower, than are cutoff, often do struggle and find themselves not well controlled on therapy.

So, I think a therapy with a really positive benefit risk profile, like AYVAKIT, which is what we expect to see based on the initial data from PIONEER will in and of itself drive some patients who want to be treated..

Okay, helpful. Thanks so much..

Thank you. And our final question today comes from Peter Lawson of Barclays. Your line is open..

Great. Thanks, taking my questions.

Just on revenues, how should we be thinking about AYVAKIT in 1Q? Anything you can tell us around put and takes around inventory or COVID impacts? And kind of – or anything you can talk about around scripts or leads, how those are kind of tracking just kind of interested in the week-to-week or month-over-month cadence, as we go into from 4Q into 1Q?.

Yes. Thanks for the question. So, over the course of the year, what we expect to see is acceleration in revenue really driven by the two factors that I talked about in terms of new patient starts and increasing treatment duration. We've continued to add patients and prescribers. We added them in fourth quarter.

We expect that to be the case in first quarter. I do think first quarter will be impacted by a lot of the same dynamics that we see across sort of biopharma, right, which is typically gross to net will be taking a hit in first quarter for thing, copays, et cetera, you do tend to see impacts to compliance for insurance changes.

And so, all of those dynamics I would expect to be a play in our first quarter, which is in part why we expect to see kind of that ramp grow through the year. We also do think that the improving COVID landscape will benefit us as we come out of this quarter and particularly get into Q2 and beyond. We're already starting to see signs of that.

We can see that our – in many ways our best performing territories are those that are the most open and so, we're optimistic coming out. As we start to see us move past this Omicron peak that trend will continue..

Got you.

And do you suspect we're going see quarter-over-quarter growth in 1Q?.

I don't want to guide specifically to quarter, I mean, we're hoping to see growth for sure. We certainly see growth in terms of a lot of those leading indicators, but we'll have to see how the picture fully comes together.

And some of the impacts you mentioned around inventory growth [indiscernible], et cetera, and we'll have a better sense of that as we're coming out in March..

Great. Thanks so much.

And then just on AACR SYMPHONY data, as we think about responses is the best way to think about this as kind of single patient gonads to potentially around tumor shrinkage for patients with less tumor heterogeneity?.

Thanks Peter. This is Fouad. This stage of development, and because we are already talking about the first dose escalation cohort, I think, data is going to be important from safety PK. As I mentioned earlier, from surrogacy and PD data, how they are remodifying the circulating tumor DNA burden in patients, including within the diversity of tumors.

And from an activity perspective, we would like to see in some patients some activity in terms of tumor shrinkers from clinical perspective. RP2D is expected around midyear, and that's the time when you expand, then you will be talking about response rates, and so on..

Great. Thank you much. Thanks for the data..

Thank you. There are no further questions in the queue at this time, so Mr. Albers, I'll turn the call back over to you..

Excellent. Thank you, operator. And it was, I think, appropriate to end on a question, touching both on the commercial opportunity and growth we see ahead as well as timing of upcoming medical conferences, such as AACR.

Obviously, as I came through on this call, we have a lot going on in all facets of our business and just feel incredibly fortunate to have the opportunity in front of us to impact patients from a research perspective, from a development perspective and from a commercial perspective.

And so, look forward to seeing you all at a range of investor conferences, medical conferences over the coming months. It's going to be a busy period of time. And a lot more to come. So, look forward to the next update. Thank you. Bye-bye..

This concludes today's conference call. You may now disconnect..