Agios Pharmaceuticals, Inc. Q4 FY2024 Earnings Call

Good morning, and welcome to Agios' Fourth Quarter 2024 Conference Call. Please be advised that this call is being recorded at Agios' request. I would now like to turn the call over to Chris Taylor, VP Investor Relations and Corporate Communications for Agios.

Thank you, operator. Good morning, everyone, and welcome to Agios conference call and webcast to discuss our fourth quarter and full year 2024 financial results and recent business highlights. You can access the slides for today's call by going to the Investors section of our website, agios.com. On today's call, I'm joined by our Chief Executive Officer, Brian Goff; Dr. Sarah Gheuens, Chief Medical Officer and Head of Research and Development; Tsveta Milanova, Chief Commercial Officer; and Cecilia Jones, Chief Financial Officer. Before we get started, I would like to remind everyone that some of the statements we make on this call will include forward-looking statements. Actual events and 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 our most recent filings with the SEC and any other future filings that we may make with the SEC. And with that, I'm pleased to turn the call over to Brian.

Thanks, Chris. Good morning, everyone, and thank you for joining us. Our mission at Agios is to develop and deliver transformative medicines that elevate and extend the lives of patients living with rare diseases. We are especially focused on rare diseases that result in the dysfunction and disruption of red blood cells, including pyruvate kinase deficiency, thalassemia, sickle cell disease, and lower-risk myelodysplastic syndromes, or MDS. Our lead product, PYRUKYND, a pyruvate kinase activator, has a novel mechanism of action that improves red blood cell metabolism and increases the amount of energy or ATP available to support red blood cell health. Today, we are pleased to share with you our results from the fourth quarter as well as reflect on accomplishments throughout 2024 and our expectations for the exciting new year ahead. Our rare blueprint for success uniquely positions us to drive significant growth in shareholder value creation over both the near and the long term. First, we have the exciting prospect of two additional commercial launches to support what we consider to be a multibillion-dollar growth opportunity for our lead product, PYRUKYND. We are planning for a potential approval and launch in thalassemia in September of this year, followed by sickle cell disease in 2026. Second, our early and mid-stage pipeline is robust and poised for clinical advancement, offering a strong foundation for innovation and growth. And finally, supporting it all is our highly experienced team with a proven track record of executional excellence and our strong balance sheet, which puts us in the enviable position of being able to independently grow the company and execute on these exciting opportunities. 2024 was an exceptional year of executional and scientific excellence at Agios, as shown on this slide, with checkmarks for each of the key milestones we projected one year ago. We meaningfully advanced each of our key programs, including filing for regulatory approval in thalassemia across four markets and completing enrollment in our Phase III RISE UP study for sickle cell disease. We continue to progress our early pipeline, building the foundation for sustainable long-term growth. After a transformative 2024, we believe 2025 is a breakout year for Agios. Over the next 12 months, we will focus on three key priorities: number one, maximizing the potential of the PYRUKYND franchise; number two, advancing and diversifying our key pipeline programs; and number three, strategically focusing our capital deployment to sustain and drive our growth. Building on all that was accomplished in 2024, we have another year ahead with compelling commercial, regulatory, and clinical milestones. Today, we announced top line results from the ACTIVATE KIDS Phase III trial with mitapivat in pediatric patients with PK deficiency who are not regularly transfused. This is Agios' first pediatric clinical program for mitapivat in a rare hemolytic anemia, and we are excited for Sarah to share with you the positive top line data from this study in just a moment. We also anticipate some exciting developments for our mid- and early-stage pipeline programs. For TevaPIVac, our novel PK activator formerly known as AG-946, we expect to complete enrollment in the ongoing Phase IIb study in lower-risk MDS by year-end and initiate a Phase II study in sickle cell disease by mid-2025. Additionally, we expect to file an investigational new drug application for AG-236, or siRNA targeting 106 inhibition intended for the treatment of polycythemia vera in mid-2025. The most significant expected events for 2025 include the September 7 PDUFA goal date for our sNDA filing of PYRUKYND in thalassemia and the Phase III readout of the RISE study of mitapivat in sickle cell disease by year-end. As you can see, this year promises to be exciting, with multiple catalysts across our pipeline that hold significant value for shareholders and have transformative potential for patients. With those introductory comments, let me now hand it off to Sarah to review our exciting progress in R&D.

Thanks, Brian. Our pipeline includes a well-rounded mix of late-stage programs nearing market entry and promising mid- and early-stage opportunities that showcase our therapeutic depth and breadth. We prioritize opportunities where our expertise and resources can make a measurable impact and create significant value. As you may have seen, this morning, we announced top line results from our second Phase III pediatric study, ACTIVATE-KIDS, which evaluated mitapivat in pediatric patients with PK deficiency who are not regularly transfused. This complements the Phase III ACTIVATE-T study of mitapivat in children with PK deficiency who are regularly transfused, which read out top line data in August of last year. Turning to the results of the ACTIVATE-KIDS study. A total of 30 patients aged 1 to less than 18 years old were enrolled, with 19 randomized to mitapivat twice daily and 11 randomized to matched placebo. All patients in both arms completed a 20-week double-blind period. The primary endpoint of the study was hemoglobin response, defined as a greater than or equal to 1.5 grams per deciliter increase in hemoglobin concentration from baseline that was sustained at two or more scheduled assessments at weeks 12, 16, and 20 during the double-blind period. The primary endpoint of the study was met. There were 31.6% or 6 of 19 patients in the mitapivat arm achieving a hemoglobin response compared to 0% or 0 of 11 patients in the placebo arm. Additionally, improvements in changes from baseline for markers of hemolysis were observed in the mitapivat arm compared to the placebo arm. In the 20-week double-blind period, a similar proportion of patients had adverse events in the mitapivat and placebo arms, and there were no discontinuations of study treatment due to adverse events for any reason. The safety results were consistent with the safety profile for mitapivat previously observed for adult patients with PK deficiency who are not regularly transfused. With data now available from the randomized placebo-controlled double-blind period of both Phase III pediatric PK deficiency studies, we look forward to sharing more detailed findings with the community and interacting with regulators. The ACTIVATE-KIDS and ACTIVATE-KIDS Phase III studies marked Agios' first pediatric clinical program for a rare hemolytic anemia, providing valuable insights that will help shape the company's future clinical programs evaluating mitapivat in pediatric patients with thalassemia and sickle cell disease. Now turning to thalassemia. This is a rare lifelong inherited blood disorder that causes chronic anemia, and patients with thalassemia often experience a range of debilitating complications such as organ damage, stroke, and other serious health issues. Current management strategies for thalassemia, such as blood transfusions and iron chelation therapy, can also lead to significant secondary effects compounding the health challenges patients face. Today, patients have limited or no effective treatment options, with 67% of diagnosed patients in the U.S. having no approved therapies. In 2024, we announced positive results from the ENERGIZE and ENERGIZE-T Phase III trial evaluating mitapivat versus placebo in adults with non-transfusion-dependent and transfusion-dependent alpha or beta thalassemia, respectively. A top line summary of the results across these two studies is shown on the left-hand side of this slide. Based on the favorable benefit/risk profile observed in both the ENERGIZE and ENERGIZE-T Phase III studies, we believe mitapivat has the potential to become a foundational and convenient oral medication for thalassemia patients regardless of their genotype or transfusion needs. In December, we announced a simultaneous filing for regulatory approval of PYRUKYND for this indication in the U.S., the European Union, Kingdom of Saudi Arabia, and the United Arab Emirates. Last month, we announced that the FDA accepted our supplemental new drug application with a PDUFA goal date of September 7, 2025. Moving on to sickle cell disease. This inherited lifelong blood disorder is estimated to affect approximately 120,000 to 135,000 individuals across the U.S. and EU5, with a global prevalence exceeding 3 million. Clinical features of sickle cell disease include chronic hemolytic anemia and vaso-occlusion, which can lead to pain, compromised quality of life, organ damage, and early mortality. There is an urgent need for novel therapeutic options to elevate the standard of care for patients suffering from this debilitating and life-threatening disease. Based on the positive results from our Phase II RISE UP study, along with encouraging data from other hemolytic anemias with a shared pathophysiology, we see significant potential with mitapivat in sickle cell disease as well. The Phase III RISE UP study completed enrollment in October 2024 with over 200 patients enrolled globally, achieving this milestone just over a year after improvement began. In this study, we have two independent primary endpoints: hemoglobin response and annualized rate of sickle cell pain crises. Obtaining inter-primary endpoints allows us to apply alpha to the trial's secondary endpoints. For our secondary endpoints, we are using a variety of measures to assess mitapivat's potential in improving how our patients feel and function. We expect to report top line results from the Phase III study in late 2025, with a regulatory filing and potential U.S. approval in 2026. We believe mitapivat has the potential to emerge as a best-in-class therapy aimed at addressing the high unmet need in this disease by improving anemia, reducing sickle cell pain crises, and making patients feel better. Next, I'd like to give a brief update on TevaPIVac, which is currently being explored as a potential treatment option for low-risk MDS and sickle cell disease. With lower-risk MDS, we aim to deliver the first oral therapy that addresses anemia due to ineffective erythropoiesis in the disease. This disease affects approximately 75,000 to 80,000 patients in the U.S. and EU5, with lower-risk MDS accounting for approximately 70% of all MDS cases. Last year, we initiated a Phase IIb study of TevaPIVac in MDS featuring three cohorts at dosages of 10, 15, and 20 milligrams, all of which are higher than the 5-milligram dose in the Phase IIa study. Enrollment is proceeding well, and we are on track to complete enrollment later this year. Additionally, last September, the FDA granted orphan drug designation to TevaPIVac in this indication, underscoring the importance of bringing an oral treatment option to patients suffering from this rare disease. In sickle cell disease, given the significant medical need and the heterogeneity of the disease, treating physicians emphasize the importance of having multiple treatment options available. In 2024, we presented Phase I results of TevaPIVac in sickle cell disease at the ASH annual meeting. Based on these findings, we will advance this clinical program to Phase II development, with patient enrollment expected to begin in mid-2025. With that, I will now turn the call over to Tsveta.

Thanks, Sarah. By 2026, we have the potential to expand our product indications to include thalassemia and sickle cell disease, addressing the needs of these two very underserved patient populations. With our anticipated launch in thalassemia later this year, we aim to deliver the first therapy indicated to treat all subtypes of the disease. With sickle cell disease, we are going to deliver a novel oral therapy that reduces anemia, minimizes vaso-occlusive crises and alleviates fatigue. By expanding our portfolio into these two larger patient populations, we hope to transform the treatment landscape for patients living with these diseases, thereby creating a multibillion-dollar opportunity for our company and our shareholders. Our team is working diligently to prepare for a potential near-term launch in thalassemia with three key areas of focus. First, we are executing a comprehensive disease state education campaign that highlights the disease pathology, the long-term complications of the disease, current standards of care, and the importance of frequent monitoring and management. Second, we are adjusting our cross-functional field team to ensure a successful launch in this larger market. For example, for PK deficiency, our sales team consists of 18 to 20 professionals. For thalassemia, we have strategically grown the sales organization to approximately twice that size. Third, we are actively engaging and educating payers on thalassemia to facilitate disease understanding and support patient access. There are approximately 6,000 adults diagnosed with thalassemia in the U.S., with most patients diagnosed before age 12. With the availability of claims data, we can identify where these patients are managed within the healthcare system, offering valuable clarity for our launch preparations. Within that population, we estimate that during our initial launch phase, we can target approximately 65% of the adult thalassemia patient population. We expect patients with more frequent contact with the healthcare system due to their disease symptoms to be considered for therapy first. These patients include those who are transfusion-dependent as well as those who are non-transfusion dependent but are already experiencing complications or debilitating fatigue. Our team is actively engaged in the field, continuously deepening our understanding of these diverse patient segments and the multifaceted dimensions of the disease. As we move toward increasingly larger launch opportunities, we are focusing on the transformative profile of our therapy for thalassemia, characterized by a number of unique benefits. This is potentially the first therapy for both alpha and beta thalassemia patients, the first oral therapy for the disease, the first treatment to demonstrate quality of life improvement for non-transfusion dependent patients, and the first treatment to show durability of effect in reducing transfusion burden. This is what motivates us to bring hope to people suffering from thalassemia as quickly as possible. Finally, let me provide a brief update on the current launch of PYRUKYND in PK deficiency. In the fourth quarter of 2024, we generated $10.7 million in net PYRUKYND revenue compared to $9 million in the third quarter of 2024. In the U.S., a total of 223 patients have completed a prescription enrollment form, including 12 in the fourth quarter of 2024, a 6% increase versus the prior quarter. This has translated into 113 net patients on therapy for this ultra-rare disease. We believe the capabilities we continue to strengthen through the current launch will provide a firm foundation from which to maximize potential future U.S. launches of PYRUKYND in thalassemia in 2025 and in sickle cell disease in 2026. Looking at the month ahead, our team will continue to sharpen its focus on the preparation for launch, with thalassemia as our main priority. We are excited about the commercial potential of thalassemia. This is driven by the following three factors: patients are diagnosed and known to the healthcare system, the burden of disease is well-characterized, and there are well-established care pathways and patient advocacy groups. We are confident that all of these elements, together with our robust preparation, will pave the way for a successful launch. In closing, we are inspired and energized by the potential to bring a new therapy to the underserved population around the world. With that, I'll turn the call over to Cecilia.

Thanks, Tsveta. Our fourth quarter 2024 financial results can be found in the press release we issued this morning, and more detail will be included in our 10-K, which will be filed later today. Let me now take a moment to provide some context and highlight a few key points. Fourth quarter 2024 net revenue was $10.7 million, an increase of 51% compared to $7.1 million in the fourth quarter of 2023. We note that revenue in Q4 of 2024 was higher primarily driven by year-end stocking and adjustments to certain revenue reserves. These account for approximately $1.6 million in Q4, and we do not expect these items to repeat in the first quarter of 2025. While lower in the fourth quarter of 2024, gross-to-net has generally been and is expected to be in the 10% to 20% range on an annual basis, consistent with other rare disease launches, and will experience quarter-to-quarter variability. Cost of sales for the quarter was $1.3 million. R&D expenses were $82.8 million for the fourth quarter, an increase of $5.3 million compared to the fourth quarter of 2023. This was primarily driven by workforce-related expenses. G&A expenses were $51.7 million for the fourth quarter, an increase of $16.4 million compared to the prior year quarter. This was primarily driven by an increase in commercial-related activities as we prepare for the potential approval of PYRUKYND in thalassemia in 2025. It is worth noting that we received a total of $1.1 billion in milestone payments following the FDA approval of vorasidenib, which were recorded in the third quarter. These payments included a $905 million payment from Royalty Pharma in connection with the vorasidenib royalty purchase agreement as announced in May 2024, as well as a $200 million payment from Servier in connection with the divestiture of its oncology business in 2021. As a reminder, Agios will retain a 3% royalty on annual U.S. net sales of vorasidenib greater than $1 billion. Taking all this into account, we ended the fourth quarter with cash, cash equivalents, and marketable securities of approximately $1.5 billion. We expect that this balance, together with anticipated product revenue and interest income, will provide the financial independence to prepare for potential launches in thalassemia and sickle cell disease, advance existing programs, and opportunistically expand our pipeline through both internally and externally discovered assets. Going forward, with our PDUFA date in sight, we are shifting our focus to preparing for the potential launch in thalassemia, and we expect 2025 revenues for PK deficiency to be relatively flat compared to 2024. Regarding thalassemia, it is worth reminding everyone that it can take several weeks, particularly at launch, between prescription enrollment forms and a patient initiating therapy. Combined with the expected time to set up payer access, we're looking at more of a partial quarter in Q4, which should be factored into modeling revenue expectations for 2025. Obviously, we are eager for the September 7 PDUFA date to arrive, and the team is well prepared for it. Looking into 2026 and beyond, we're optimistic about the team's ability to translate the favorable market dynamics that I described earlier into a significant revenue trajectory for thalassemia. In closing, we remain focused on creating shareholder value, including by proactively managing our cost base and deploying a disciplined cash allocation approach as we prepare to support potential future launches. As we move towards additional potential value-creating milestones in the near term, I am confident that our balance sheet will continue to enable us to execute from a position of strength. I will now turn the call back over to Brian.

Thanks, Cecilia. Before we conclude, I'd like to highlight one more piece of news from our press release this morning: Dr. David Schenkein has informed us that he will step down from our Board of Directors effective February 28, 2025, to devote more time to his other commitments. He will continue to serve as a strategic advisor to Agios' leadership team, concentrating on advancing the company's clinical development programs. David has been with Agios for 15 years, serving as the company's CEO for 10 years and throughout as a member of the Board of Directors. On a personal level, I'd like to thank David for his friendship, mentorship, and guidance throughout my years leading Agios. He has played an instrumental role in shaping our company into what it is today. On behalf of the entire organization, I also want to express our deep appreciation for his invaluable contributions. We are truly grateful and look forward to continuing our collaboration with him in his new advisory role. 2024 was marked by exceptional progress at Agios, and as you've heard, we have exciting regulatory and clinical milestones ahead in 2025. We believe 2025 will be a breakout year for the company based on the anticipated approval and launch of PYRUKYND in thalassemia, a critical Phase III readout in sickle cell disease, and important anticipated progress across our mid- and early-stage pipeline. In closing, I'd like to briefly reinforce Cecilia's comments. We have a very strong balance sheet, which provides us with the ability to independently execute across our key priorities, which include maximizing the potential PYRUKYND launches in thalassemia and sickle cell disease, advancing our existing early and mid-stage clinical programs, and expanding our pipeline with both internal and external opportunities. We remain committed to disciplined cash allocation, ensuring our strong balance sheet supports the achievement of key milestones and positions us for continued value creation. We look forward to the future as we strive to change the trajectory of these rare diseases. With that, I'd like to open the call for questions. Operator, please open the line.

Our first question comes from Eric Schmidt with Cantor.

Congrats on all the progress. Looking forward to another remarkable year in 2025. Maybe first for Sarah, what's the company's plan or strategy for updating the investment community on the safety profile of a few batches of NPA? Should there be any further cases of hepatocellular injury or any signals, what's the lever there? And then for Brian, now for probably the past year or so, I think you've been talking about the multibillion dollar potential of mitapivat in these additional indications. How do you think about peak sales potential in either thalassemia or sickle cell disease as you construct that multibillion dollar estimate?

Sure. Thanks, Eric. Sarah, you want to start on the first question?

Sure. Thanks, Eric, for the question. As we have done when we were aware of this new safety information for thalassemia, we have updated the investor community at the time that we were able to make that call that there was a change in the safety profile of the drug. So if anything would change to the safety profile of the drug as we currently understand it, and we make that call, then we would update you guys as well.

And on the second question, Eric, on the multibillion-dollar potential that we see for PYRUKYND, I'll say that we're very excited for the position that we have right now with all the momentum as well as the backdrop of the clinical data, and now the PDUFA date for thalassemia that we talked about. Just to characterize why we have such conviction in the long-term potential in thalassemia, as we said on multiple calls, two-thirds of the patient population in the U.S. have no approved therapy option, which presents a profound opportunity in terms of unmet need for those patients. We look at the combined opportunity of both the ENERGIZE and the ENERGIZE-T data, and it's a really compelling profile. The second with sickle cell disease, I think it's been really obvious to the whole community that the unmet need in sickle cell disease has always been very high, and it has actually increased in the past few months, given some of the challenges and limitations in available therapeutic options. So that's an important step for us, too. And of course, we'll be in a position to give more guidance as we move through these approval pathways, the launch phases, and in the case of sickle cell disease, it’s getting to the point of the data readout at the end of this year for the RISE UP Phase III study. So a lot of conviction, that's all with PYRUKYND. And of course, we're building out a PK activation franchise beyond that, with the benefit of TevaPIVac, as we've noted, we're pursuing a Phase II study in sickle cell disease as well as we're already enrolling in our Phase IIb for low-risk MDS. So a lot of opportunity ahead.

Our next question comes from Divya Rao with TD Cowen.

This is Divya on for Mark. Congrats on all the progress. Just one on sickle cell. So after the liver tox disclosure in Dow last year, can you provide any details on changes to the sickle cell trial protocol? Is it mostly in the OLE portion? Or were there any changes to the core portion of the trial? And then I have a follow-up.

Thanks, Divya for the question. We, in the core period, after we had made that call, we took a look at the monitoring across all of the trials. We were already monitoring in our core period for liver enzyme test results along the way in each of our trials during the blinded period, which is very much in line with how people start therapies in the real world and monitor drugs in the beginning when they start patients on drug. In the open-label extension, we had to make a tweak to align the monitoring frequency to what we were doing in the core period of the sickle cell disease trial. So now, everybody is being monitored across all of our programs once a month for the first six months of exposure.

That's helpful. And then with TevaPIVac being explored in sickle cell, how should we think about the development path there? Is this more of a proof of concept before moving into other diseases, or if the trial is successful, do you actually plan to move forward into pivotal development in sickle cell with this program?

Yes, thanks, Divya. I think I'm going to have Tsveta comment on that from a longer-term commercial perspective because, again, it's a real benefit to have not one, but two opportunities in this very complex, very high unmet need disease.

Absolutely. So when we think about TevaPIVac, as Brian mentioned, there is certainly unmet need in the patient community. We hear it loud and clear from clinicians that there is a need for more than one treatment option with the recognition of the need for multiple PK activators. As we currently stand with TevaPIVac, we are looking for an opportunity to build a sickle cell disease franchise across both PYRUKYND and TevaPIVac. In terms of specific positioning of the two products, we will be guided by the data. As always, we will need to see the right updates. We need to see the data from the Phase II study, we’ll look at the competitive environment at that point in time, and Sarah and I work closely together to develop a clinical development plan, which will not only meet the needs of regulators but will be commercially viable for us as well.

As we get closer to the midyear start, we'll, of course, gain more clarity on the trial design and exactly what that looks like.

Our next question comes from Gregory Renza with RBC Capital Markets.

Great. Brian and team, congrats on the progress in the year. Brian, maybe just dipping into the pipeline and as you get your hand on the PK activation portfolio, I just wanted to ask about just your enthusiasm on how you're characterizing your level of enthusiasm with respect to AG-1, the PAH stabilizer. Maybe just remind us of that specific mechanism, how it stabilizes PAH and perhaps why it should work well with patients who don't respond to that co-factor treatment?

Sure. The first thing I'll just say, Greg, is I do not pick favorites among children within our pipeline. We're really proud of all of the programs across the pipeline. We're in a really good position of strength with respect to diversification within the pipeline in both type of asset, disease, as well as stage of development. With respect to AG-1, which is a phenylalanine hydroxylase stabilizer, in a way, it’s similar to pyruvate kinase activation, where it stabilizes the enzyme that's needed for the conversion of phenylalanine. We're currently in Phase I now and we look forward to providing continued updates as we make progress on the development opportunity. This represents a very high unmet need population, with 35,000 to 40,000 patients and a very small subset of those who are actually actively treated. They have very limited treatment options. This is another market of excellence that has come out of Agios' discovery and development efforts, which is right in the sweet spot of what we do best: addressing high unmet needs in rare diseases. We definitely look forward to providing you with more updates.

That's helpful. And maybe just a broader question, taking a step back. As you look at your potential cash deployment internally and also externally, how are you seeing the market for external assets, especially in light of what is a rather active market, not just domestically but also globally?

Yes, great question. First of all, I would reinforce that we have a compelling future ahead. We are pleased with the enviable strength of our balance sheet, which enables us to, as a first priority, maximize these launch opportunities with thalassemia and sickle cell disease. That's job one. Job two is ensuring that we continue to deliver on other mid- and early-stage products in our pipeline. Regarding your question on external assets, we have scaled up our business development capabilities, particularly from a search and evaluation standpoint. It's important, as any healthy company will do, to be very disciplined in that approach. But we are clear on where we believe we can add significant value creation, looking domestically and globally.

Our next question comes from Greg Harrison with Scotiabank.

Congratulations on the progress. As you think about how investors should model the launch trajectory for mitapivat in thalassemia, potentially in 2026, I recognize there will be some time needed to gain access and a delay before starting therapy in the fourth quarter. Do you anticipate that there will be pent-up demand or an initial surge in some of the patient groups you've mentioned as the initial focus for the launch?

Yes. Thanks, Greg. I'm going to start by saying how proud I am of Tsveta and her entire commercial organization, which has been so dedicated to disease state education for thalassemia, which is very much needed in this arena. We're really well positioned and prepared for the PDUFA date in September. Cecilia, would you like to comment on what those dynamics might look like towards the end of the year?

Absolutely. The team is working diligently to prepare for launch. We are excited by the opportunity to provide treatment options to patients in the U.S. As mentioned, we’re focusing on about 65% of all adult thalassemia patients in the U.S., which is 4,000. From a launch perspective, we are educating to increase urgency to act, monitoring three patients. Having said that, I don’t expect to have an initial bolus in patients as they will come to their doctors during frequent visits, depending on their transfusion-dependent or non-transfusion-dependent status and any complications. We will capture these patients as they come in, continuing our disease education to ensure that appropriate conversations are happening for them to make the best treatment choices moving forward.

And this is smart triaging too. When we say 65% targeting, it doesn't mean we won't eventually target the other 35%. It just means we are making thoughtful choices to get off to a solid start in terms of launch ramp. The team has already been rightsized for this opportunity, and the intensive focus between now and the launch is on disease state education. Once we get clarity on the label and we have that launch opportunity, we’ll be in a great position.

That's helpful. I also wanted to ask about the Gulf region and the launch there. Are you getting a better handle on the commercial potential in that region? And how should investors be thinking about that opportunity?

Yes, we see the potential for the Gulf, obviously, with the U.S. as our #1 commercial priority. The Gulf includes Saudi Arabia as the biggest market, and we have a breakthrough designation there, working closely with the NewBridge team to navigate the regulatory process in that country. When we look at the launch ramp in that area, it will take time to navigate access and formulary discussions with different healthcare segments, but there is significant commercial opportunity given the number of patients.

Our next question comes from Chris Raymond with Piper Sandler.

I have two questions. First, regarding the repeat studies in PKD, you mentioned that ACTIVATE-KIDS and ACTIVATE-KIDS-T provide insights for future pediatric work in thalassemia and sickle cell. Can you elaborate on this benefit? Do you anticipate any acceleration of a pediatric program as a result, or could there be some immediate labeling advantages stemming from this work? My second question, which I know has been asked multiple times, pertains to the PDUFA and a potential advisory panel. Given the heightened focus on liver injury, while companies typically don’t hope for a panel, it seems that this attention might actually be beneficial in providing clarity. What are your thoughts on whether you would prefer a panel or not?

Thanks, Chris. Sarah, do you want to start on both pediatric.

Yes. I’ll start with the pediatric. While we know that pediatric development is very hard, we've worked through many logistical issues that we needed to consider for those pediatric trials and successfully implemented them. All of those lessons learned along the way will apply to any future pediatric trial we run. There's a huge benefit from this hands-on experience, which will assist with feasibility and clinical trial logistics for future studies. Because we're following a similar path across hemolytic anemias in adult development, there are many lessons that can be applied from adults to pediatrics. We are very excited about expanding the patient population too. Of course, any label negotiation will help with the next label negotiation as well. Regarding the PDUFA date and the potential for a panel, we are very happy that the PDUFA date has been announced, September 7, and we have not heard that we would be having a panel at this point in time. Panels are a lot of work, both for us and for the FDA. So I’m not sure if I still agree with the assessment that we may be hoping for a panel. Regardless, we will be ready if it happens. However, we already have data from the PKD label update with the warning and precaution, which highlights what we observed in the thalassemia patient population. That assessment has been agreed upon with the FDA for the label update in PKD.

Our next question comes from Alec Stranahan with Bank of America.

Congrats on the updates from us as well and look forward to a busy 2025 ahead. Just two from us. Thinking about the process of scaling your sales force OPAL, given the energies have both been presented at major medical meetings, what is your sense of the level of awareness amongst physicians as well as patient advocacy groups? Is this kind of tracking with your hopes? Or is there maybe more work to do there? And has this fed into the number of reps you've hired for commercialization or not really?

Yes, absolutely. Once we had the data from the ENERGIZE study, we made the decision to start rightsizing the customer-facing organization for launch. We approached the launch in a very comprehensive way, focusing on patients, physicians, and payers while ensuring we have the right organization. We have already rightsized the sales force, especially for thalassemia. From an awareness perspective, our team has been connecting with the care community and the prescriber base, which is mostly community hematologists. I can confirm that awareness of the disease and the potential for new therapeutic options for these patients is indeed high. We are continuing our efforts on disease state education with patients, physicians, and patient advocacy groups. We are working hard and are ready for the launch.

Before we had the PDUFA date, we didn't know when it would be set. The team has, as any good pre-launch team does, been preparing for a range of scenarios. Knowing the date is crucial for the team to maximize the opportunity in disease state awareness leading up to launch. We have continued progress with the KOL community as well as with treating physicians.

I have a quick question about pediatric PKD. Do you plan to seek approval for both transfusion populations, those that are regularly transfused and those that are not? Also, do you think approval across these patient groups could be justified based on the overall data from the two studies?

Yes, absolutely.

The data across both trials supports a positive benefit-risk profile across the patient population. In the regularly transfused trial, we have patients who are completely transfusion-free, which is an enormous clinically meaningful benefit. In the ACTIVATE-KIDS study, we clearly have positive results overall. We are looking forward to obtaining that broader label for patients with PK deficiency.

What fuels us as an organization are the stories that we hear from patients. PYRUKYND is the only approved therapy for adult patients with PK deficiency. These patients have had kids, some of whom were splenectomized while others are awaiting potential treatment. To have this promising data relevant to the ACTIVATE-KIDS trial in transfusion-dependent pediatric patients and the data we shared today is compelling. We will strive to move that along with the regulators at the right time to make this available for patients.

Our next question comes from Salveen Richter with Goldman Sachs.

This is Lydia on for Salveen. Congrats on the progress. Maybe just a follow-up to the previous question on pediatric PKD. Could you just discuss how expanding into the pediatric population could potentially impact the total opportunity in PKD?

Tsveta.

Yes, absolutely. The pediatric population represents about 20% of the PKD opportunity. PKD is an ultra-rare disease. The trial offers us a great opportunity to provide treatment options for patients in need who currently have no options. It is also a starting point for us to continue pediatric development across all other indications and to apply all the learnings to thalassemia and potentially sickle cell disease in the future.

To reinforce Cecilia's earlier point on PKD revenue: it makes up about 20% of the population. This is particularly relevant as we prepare for the thalassemia launch, so we're expecting flat revenues in PKD this year. However, adding pediatrics is essential for treatment optionality for these patients.

Our next question comes from Tessa Romero with JPMorgan.

So just a brief financial question from us to start. Cecelia, in terms of your OpEx, what is the right way to think about the evolution of your SG&A expenses and the cadence of a ramp-up in those over 2025 and into 2026? And on the R&D side, any additional color you can give us there? And then I have one follow-up.

Sure. We continue to proactively manage our cost base as part of our disciplined capital allocation approach. That said, as Brian described earlier, we have three priorities: preparing to maximize the PYRUKYND opportunity with potential back-to-back launches and also advancing the pipeline. For both SG&A and R&D, we expect to see growth year-over-year in the coming couple of years, with some quarter-over-quarter variability, but we do anticipate growth on both items.

Okay. And can you quantify what growth means?

We haven’t given specific guidance on growth. But we are being very disciplined in how we approach this. As Tsveta mentioned, we waited to see the thalassemia data before kicking off a larger ramp-up. We're taking a similar approach for other programs to ensure we’re prepared, so we won't find ourselves in a situation where we didn't prepare.

Okay. And then within that, from a timeline perspective, can you lay out for regions beyond the U.S., how you're thinking about the timing of approvals? I'm thinking about the EU, Saudi Arabia, and the UAE?

Yes, Sarah, would you like to comment on that and Tsveta can address the commercialization approach?

Yes, the timing of approval: the PDUFA date for the FDA is September 7, and that is set. For the others, they typically do not give proactive dates by which they will approve. It depends on how the process goes and how many questions arise. We are excited about the progress that is currently being made.

From a commercialization perspective, as I mentioned earlier, our focus is on the U.S. as our #1 commercial priority. After that, the Gulf is our second commercial opportunity, particularly Saudi Arabia, where we have a breakthrough designation. We are actively navigating the regulatory process there. In Europe, we are looking for potential partnerships for the post-approval process, which will depend on pricing and reimbursement decisions in individual countries.

I'm showing no further questions. I'd like to turn the call back over to Brian for closing remarks.

Thank you very much, everybody, for participating in today's call. We are 1.5 months into the start of what promises to be a very busy and exciting year. It's an exciting time at Agios. We really believe that we're poised to deliver transformative new therapies for patients and create significant long-term value for shareholders. So thanks again, and we look forward to speaking with you again soon.

Thank you for your participation. This does conclude the program, and you may now disconnect. Everyone, have a great day.