Afternoon, everyone, and thank you for joining. My name is Rajan Sharma, European Pharma and Biotech Analyst here at Goldman Sachs. I'm very pleased to have Argenics with us this afternoon for the last fireside of the day. And we've actually got two speakers. We're lucky to have two speakers today. We've got Paul Gubitz, who's CFO, who you all probably know, and then we also have Arian Lamend, who is Head of Corporate Development. Maybe just to kick off, Ari, and given that you're probably someone that hasn't had as much time with investors relative to Carl, maybe if you could just give a brief introduction of your role yourself and how that's evolved over the years at Argenix.

No, happy to do so and happy to be here. So my role at Argenix is indeed that I had corporate development and strategy. I've been with the company since 2015, so I joined Argenics when it was just 30 people at the time with a responsibility on our business development dealmaking. I ultimately evolved my role in a broader corporate development responsibility in the senior leadership team. So my team focuses on really everything related to third parties and dealmaking, So the business development, the partnerships, the alliances are sourcing with suppliers and corporate strategy as a whole. So supporting the organization, which countries do we enter, which indications do we prioritize, does the overall portfolio make sense, which molecule do we take into what indication basically.

Okay, brilliant. So we'll definitely dive into some details there. But maybe just to start, maybe if we could just start on VivGart commercials. You obviously had a very solid start to the year, 60% year-on-year growth in Q1. But competition in MySenior in particular is stepping up. We've had a couple of recent approvals and potentially one coming. Just in that context, how should we think about the growth outlook for VivGart, firstly in Mycenae Gravis in the near to midterm?

Thank you, Rajan. Yeah, MG still has a lot of growth ahead of it. We are now 17 quarters into the launch, but the growth is not slowing down. The share of biologics, that's VivGuard, all the other FCRNs, C5s, and so forth, is only about 20% of the total market. 80% of the market is still on the orals, methanol, steroids, immune suppressants. There's a lot of growth into the earlier lines. And VivGuard is not only the biggest of the innovators in that 20% share of biologics, it's also driving the growth. Because if you ask a doc, four out of five docs will say you start with VivGuard. And now, of course, we also have a seronegative, which gives us the broadest possible label to help with that growth. That adds 11,000 patients to take the total addressable market if you add zero negative, moving into the earlier lines, and also ocular, which we have the data but not yet the approval, to 60,000 patients. And one of our key growth drivers continues to be the PFS for self-injection because of the convenience of a 20-second injection, which none of the competitors can do, of course, is also driving the growth. So a lot of growth looking forward in MG. And on CIDP, if I can quickly add, we are in the early innings of a launch there. We're still at the bottom of that patient funnel in that 12,000 patients which are not adequately addressed with standards of care. Slowly over time, we can move earlier line. But both CIDP and MG continues to grow in all markets, so I think we set for growth for the rest of the year.

And in terms of maybe just to double down on MG for a moment, you said 20% biologic penetration in the indication. Where do you think that can go, and are there any specific analogs that you look to as you think about how are biologic?

It's a great question. Of course, we also debate it internally, And the short answer is I don't know what the share of biologics will be in a few years, but it should be multiples of 20%. And it is VivGuard who is driving that biologic growth, as I said earlier, because of our efficacy, safety and tolerability, and the patient convenience. So I think that we can look forward to expanding that biologic growth number significantly.

And then just thinking about seronegative, it's obviously clear that it adds a reasonably significant number of patients, but how should we think about the ramp there? I think, you know, Q1 talked about being ready to launch there, whereas in previous new launches you've talked to maybe two or three quarters to get reimbursement in place. Is it different for seronegative?

Seronegative is a little bit different, but typically when you add a new indication, You have to go back to the payers to do a negotiation. Of course, this is not necessarily here because GMG is on the label, but the payers need to change their formularies to say that the acetylcholine positive requirement to do a test and to send in the test, that can now be removed. That is actually removing a bureaucracy or a process at the physician's office, and I think that, of course, is very helpful for them. Remember that the triple negative, the zero negative is three subsets, and half of that patient population is the triple negatives, which has no options available today. So there are many patients waiting. But in terms of the trajectory of a growth, 17 quarters in, we continue to show growth quarter after quarter. And to maintain that growth, you need new innovation. So this is the new innovation which is going to drive growth for this year in MG, the zero negative plus the PFS, which is continuing to drive growth.

And then obviously we have the ocular potential as well. We've seen that you've hit on the trial. Is that a similar scenario where it could be a relatively quick uptake?

Now, on ocular, it's an important part of, I already mentioned our strategy, is to be the first-line biologic and to move earlier line. Ocular is earlier lines, if you like. 85% of ocular patients generalize into generalized myasthenia gravis. We think we're going to add around 7,000 patients there, and the unmet need is clear. At the recent medical conference at AAN, when we presented the data, it was standing room only. and this is because the unmet need calls out for a new tool in the toolbox to treat these patients. And I think that we don't have approval yet from the FDA, of course, but what we're hoping is to change GMG into MG and that will get you to the 60,000 total addressable market.

And I think the unmet need is very often underestimated in ocular. I think like the shorthand has sometimes wrongly been that ocular is less severe, right, because you don't have these generalized symptoms yet. But just imagine how debilitating ocular on its own can still be. I mean, these patients with the double vision they have, they cannot work on a computer, They cannot drive a car. It's hard to actually walk anywhere without falling, right? I mean, so it's overall not a version that is less severe. It's just concentrated in the eye at that stage. And it is, indeed, typically earlier in the disease manifestation.

And then maybe just quickly touching on CIDP, do you have a sense of where penetration is that they've got right now and you talked about kind of moving to earlier lines and how do you actually enact that? Do you need more clinical data or is it more of a case of physicians becoming more familiar with the product profile?

Moving earlier line of course is, let's call it, a little bit more aspirational. We're going to get there over time because where we are now is still early in the launch. If you just look at the patient numbers, 42,000 patients diagnosed in the U.S., 24,000 of them are treated, half of them not adequately treated with standard of care. What we continue to do is to educate the physicians and to activate the patients. You'll see in the U.S. all the DTC, the television campaigns, because what really helps to get a patient on VivGuard is if a patient goes to the doc and ask the doc, is VivGard right for me? So we need to do a lot more work in terms of patient activation, physician education, and then over time we can increase the usage of it. But we're still early in the launch, and the penetration is relatively low.

Maybe kind of moving to BD and then potentially M&A, could you maybe just outline what sorts of assets are potentially of interest to Argenix? I mean, you've done a few smaller deals, whether that's for technology platforms or formulation. And what was the rationale behind those?

Yeah, so I think partnership has really been in the DNA of our GenX right from the start. Actually, one of the cultural pillars of the company has been what we call co-creation, where we work together with our partners, either a technology partner or an academic partner. and that's how we've been able to create and design the molecules that we have in a differentiated way. And we actually consistently do that. So in our IIP, we do these business development licensing deals in close collaboration with the scientific team identifying the novel biology. But there is actually not any program in Argenix that gets started without some form of partnership at that from day one. And we do, I think, a multitude of these deals per year. And you've seen, if you track carefully, the early stage pipeline we've systematically added to that early stage pipeline, building up, let's say, the innovation engine for the future. What I think has changed with the company turning profitable is the means to build on that playbook but also apply it to later stage opportunities. So what are we looking for? We're looking for opportunities that still fit the Argenix Innovation Playbook. So we're looking for novel target biology, first-in-class opportunities. We're looking for opportunities where we can bring our pipeline in a product execution. And we're looking for that in a context of neuromuscular and INI. None of that, I think, by any means is surprising. I think from a stage point of view, we're looking for opportunities that are IND minus 12 months, so a preclinical asset, or IND plus 12 months, maybe a phase two asset. It could be later if it's the right fit. I don't think that these rules are dogmatic in any way, but just to give you some color. So at the beginning of the year, you saw us sign this option to acquire Tensegrity, which is a Japanese biotech company. They have an antibody molecule against a novel target, FN14. We believe that that target biology has applications in multiple muscle-wasting disorders, so we can apply our playbook there. It's an option deal, so we actually create a way for us to generate data together based on which Argenix can decide to bring it in. And it's an incredibly strong antibody, actually. Tensegrity, for those of you that don't know, it's a spin-out company out of Astellas. I mean, that molecule was actually discovered in the Astellas discovery. So I'm just highlighting it because it's just a good example of what we've been doing, but there's other shapes and forms that potentially could fit.

And where do you think that you add value as a partner? Is it on the development? Because obviously VivGuard's been pretty successful. It's been tested across multiple indications. You've been successful in most of them. Or is it as a commercial engine where, again, you've been pretty successful at commercializing the drug?

I think it can be both. So clearly if it's something that fits our commercial organizations, there's a way for us to add value. I think from a development, execution, pipeline in a product, there's a way to add value. For the earlier stage program on the antibody engineering, there's a way to add value. I think one of the prerequisites is that we have to add value to the deal. We cannot only be a financial tool in that. we also need to bring capabilities, I think, to these assets that basically allow to either broaden or accelerate the opportunity that the biotech company otherwise would have been able to do.

And how do you think about sort of capital allocation there? I mean, not just from a balance sheet perspective, but then I guess also from a P&L perspective, because if you're bringing things in, there's an R&D cost that comes with that. Are you sort of holding back some of the internal spend in the anticipation that there will be something external coming?

I think the strength of VivGuard really is the type of asset which builds companies. If you look at the scale of our revenue, even now, and there's a lot of growth, as I said, ahead of us, you'll really see the revenue falling through to profitability. That said, we have a unique opportunity to build the company for the long run. We are going to invest in building durable growth now. SCAR should give us that growth into the next decade, but after that, we're going to have a large base, and to build durable revenues on top of that, you need to invest in innovation now, and that is what Arian is doing now, and that is the strategy of the company. I think that, as I said, we've got growth, can afford, but we can do both. But the priority, number one, of course, is revenue growth, and that is where the dollars go first.

And maybe just on that point of sort of revenue growth dropping down through the P&L, how should we think about that on a forward basis? There's obviously, you know, some confusion within the market on the OPEX then for 26. How do you think that is going forward, and do you think the market's in the right place now?

Yeah, I mean we were clear at the beginning of the year that the OPEX growth year over year and this is combined R&D and SG&A should be around 30%, free zero. That should get you to around $3.5 billion on a full year basis. So we wanted to put that marker out there. At the end of Q1 we made a $400 million operating profit which is an operating margin of 30%. We don't want to give targets out there in terms of operating margin because we don't want to box ourselves in. We want to chase the novel biology, as I said earlier on. But over time, of course, we think that we can provide operating and we will provide operating leverage. And so you can see that margin improving over time.

And then maybe just, conscious of time, just moving on to pipeline readouts. It's obviously a relatively busy second half of the year, lots of focus on myositis. I'm conscious that you have the event in a couple of weeks, but could you just kind of walk us through the trial there, what populations you're studying, and how to think about the sort of respective commercial opportunities in those subtypes?

So myositis study readout, a registrational study will be in Q3. In a couple of weeks, we have an R&D day on myositis. It will also be webcast, so please join us. It is a basket study across three subsets, dermomyositis, IMNM, immune-necrotizing-mediated myositis, and also polymyositis, PM. In terms of... I won't get into all the details here. I think please join the R&D day. But there's a path to get all the subsets or one or two of these subsets. It really depends on the data, and it depends on the FDA, of course. The unmet need surely will also play a role. In terms of a commercial opportunity, let's start with IM&M, because that's 20,000 patients, and it's complete white space. This is probably the best example in the myositis of being a prototype Argenix indication, strong biology rationale and clear unmet need. If you take that 20,000 patients with no treatment options, I think we have an opportunity to very quickly transform the lives of those patients. Very excited about that commercial opportunity. The bigger brother, if you like, is dermomyositis, 40,000 patients, but of course there will be more competition there. A JACTIC2 from Royvand, Brepo, will launch in September this year. It's an oral, but of course it's a JACT which comes with certain safety considerations. But at the end of the day, dermomyositis is a very heterogeneous disease. So I think over time, each innovator will find its place in that indication, and Vivgard can also be very excited there. So I think that more to come on the R&D day, another Phase III data in Q3, lots to be excited about.

And maybe just thinking on the OPEX point, it's kind of related here, just assuming that you kind of get the label in all three indications, how should we think about that incremental launch cost that come with that? Because there will obviously be a new physician group that you'll be targeting.

Yeah, so it is, I mean, of course, the GenX playbook is if we launch, we play to win. You've seen that from the MG launch, you've seen that from the CIDP launch, and we will play to win. We will put in a field force for rheumatology. Part of myositis is prescribed by NEROS, where we already have strong relationships and established capabilities, but we will need a rheumatology field force. We will look at what patient activation strategies which we will put in place. But because the platform is already in place, I think the launch will be very profitable in terms of a P&L. It will not be a drag in the operating margin. It will actually support the operating margin. And just to put a sense of scale out there, we launched MG in the U.S. very successfully successfully with 70 reps, 7-0, just to give you an indication of a size you need for an orphan type of indication in the U.S.

That's super helpful. And then maybe just on the data itself. So we saw the Phase II data. It looked pretty encouraging. We don't know what the subtype split was in that. Is it fair to assume that there was a similar level of efficacy across all of those subtypes?

We didn't provide all the detail, of course, but the only thing I will say is that at the end of phase two, we had the option to not to continue in one or two or three subsets, and we made the decision to continue with all three. And we will, of course, now get the data in a few months of phase three data.

Okay, perfect. And then maybe just switch into Empathy Prevot as well, which I guess kind of fits with the external innovation piece as well. How should we think about the commercial opportunity there in the initial indication of MMN?

Yeah, MMN is an, I think it's the kind of indication where, first of all, like in CIDP with DIVCAR, there hasn't been innovation in that indication for decades, right? The only available option for those patients is IVIG. What we've said is that there is about 12,500 patients in the core markets. We think about 6,000 of those in the United States. So that's, I think, the direction to think about. What is also important to note about MMN and its unmet need is that we know that the MMN patients are actually the single highest consumers. They tend to use a lot of IVIG, which I think is a testament to the level of need that exists in that patient population.

In terms of a broader context, if I can just add, the bare case on Argenix is that we are, it's a single acid concentration risk. And this is why EMPA and the MMN data, which we'll read out in Q4, is so important for us to show you what we're doing with VivGuard is repeatable and scalable because EMPA is currently in two phase freeze and more indications to come.

Okay. On that point, how much of an important sort of readout is Impassion in the sense that it de-risks Empath for you internally, and then is this a scenario similar to VivGott once you have confidence in the profile that you then explore multiple indications?

Well, I think we're already executing that strategy, right? I think we designed a very strong molecule with EMPA. It's highly differentiated in its molecular design. We think C2 is a great target to intervene in the complement system at the intersection of the classical and the lectin pathway. So it has this pipeline in the product potential. So MG and CIDP are leading the way. We've been there with DGF, but I think we're not done evaluating new indications for this biology. Okay, makes sense.

And then eventually, is that something that you can foresee, again, kind of extending that VivGuard sort of playbook where you have multiple formulations?

Yeah, I think the presentation playbook that we had for VivGuard would also apply to MPa, but probably in an accelerated way relative to VivGuard.

Okay, makes sense. And then you're also exploring the asset in CIDP. How should we think about that coexisting with VivGuard? Is this a combination approach, or is there a subset of patients that don't respond on VivGuard and they need an alternative?

Yeah, so we made a couple of important choices there. So first of all, we didn't subordinate our EMPA development to VivGuard. So it's not VivGuard failures in the EMPA trial. Actually, our strategy is to develop EMPA for the broadest possible label, and we will let the data speak on how to think about that. We do know that there is likely that these molecules target different biology to a certain extent. In CIDP, it is characterized that IgMs also play a role. IgM activates complement. VivGard, biologically, it would not impact an IgM. So could you see that, you know, that biology is part of a rationale of patients that don't respond on VivGuard? It could be. And would these patients potentially have a right to respond to EMPA? I think biologically the answer would be yes. But we're putting that through the test, and basically what we're doing on the co-positioning is we're generating the data-driven decision and on what the approach is based on the label, based on the data sets, we would be the only player in this market that has multiple modes of action. So we're, I think, in a strong position to continue to build out and generate return on our investments in CIDP.

Makes sense. And then thinking a little bit deeper into the pipeline, you've obviously got a couple of next-generation SCRN assets. But maybe if you think with your sort of thinking about portfolio strategy and how did those coexist? And is this a case of wait for the data to mature and then you make a decision on which you take forward?

Yeah, I think portfolio is a very important word in that context. So what we are trying to achieve on the next generation is to move our FCRN leadership with VivGuard into potentially a decade-long strategy. So we have, from that, we created multiple next-generation molecules, and these have differentiated profiles. So we've been public on the profile of our GenX 213, It's a longer-acting FCRN. It's completed early-stage studies. It's ready for late-stage studies. Then we have our GenX-124, where we have not been public on its design and its mode of action. But what we can say is that it's not just another 213. It's a different molecule. It's a different profile. That is currently going through phase one. what does that optionality allow us to do, right? It allows us to think about lifecycle for VivGuard in a way that's still elevated, but it potentially also gives us the obligation pipeline even beyond, let's say, the current set of indications. And we do know that there is more evidence being generated for anti-FCRN. There is a multitude of IgG-driven diseases in which we haven't explored yet. So we're creating this portfolio, and that's the second wave in this portfolio. I think that J.P. Morgan and Tim also highlighted for the first time, I think, the third wave on how we think about that with a potential oral formulation in FCRN as well. Okay.

And in terms of timelines, you talked about 213, we know a little bit more about that. Is that potentially ready to go to phase three? And can you be a bit more aggressive in terms of timelines, given you have the capital and you have the understanding of the mechanism?

I think that is exactly right. It's potentially ready to go to phase three. It's really about what is the right plan, how to move that forward in the fastest possible way. In addition to that, the 124 data is not far out. We will see that in the second half of this year, and that will really, I think, give us the information to say which molecule is best positioned where, at what pace. So we're doing, let's say, all that scenario strategic analysis as we speak.

And maybe just on the point of sort of there are more IgG-mediated diseases that you could target, not just with VivGott, but also with the next-generation assets. How should we think about pricing? Because you've got Sjogren coming next year, which is a potentially larger indication. You're also exploring Graves' disease, which is a much larger indication. So can you maintain sort of orphan-like pricing as you expand into those indications?

Yeah, if you think, I mean, Sjogren's a very big indication, more than 300,000 patients. But if you think about where the drug might work, probably more in the moderate to severe subset of that, which gets you more to an MG-like opportunity in terms of patient numbers. So I think, yes, you are right. As we add on more indications, pricing pressure will come, surely, and maybe we need to adapt our price, but think of that as a very slow decline, more of an offset with incremental patients over time.

Yeah, I'm just kind of thinking about the strategy that Alexion or Astra had as they shifted from Solaris to Altomeris, and there was obviously a price incentive to do that. Is that something that may be rational?

That may be something, yeah. I think, as Arian said, we want to have multiple next-gen FCRNs. One will be lifecycle management, and we can look at playbooks. There are many successful playbooks out there. Solaris to Altomeris surely is one of them. but then to have a second FCRN at a different price point, possibly lower price point, maybe broader indications, we'll see. I think that will be all important aspects to consider.

Okay. And just on 1-2-4 timelines, should we expect an update there this year?

Well, we'll have the data this year allowing us to make that portfolio-level strategy decision-making. to what extent we will communicate that this year. I'm looking at our IR. We're going to be light in communication. I think that's exactly right. I think in this very competitive environment, we will really want to maximize our position, and we will want to go as fast as we can and then do the communication in a very deliberate and strategic way.

Okay, well, let's move on before you get in trouble. Maybe on systemic fluorescence, there's obviously a Phase 2 data readout coming, second half of the year. What are you looking to learn from that, and how quickly could you then move to a registrational study, or would this be one of those sort of seamless Phase 2 to Phase 3s that you've employed in the past?

I think scleroderma is an indication of a similar size as miliasteniagravis where there's tremendous unmet need. There is really not that much that works. The approved drugs are typically confined to the lung setting and more systemic settings or manifestations of the disease are really lacking treatment options. I think the alternative bodies are well characterized in this biology as a potential driver of the disease. That's really what we're putting to the test in Phase 2. Can you intervene? Can you see the kind of effect that justifies moving that forward? Can you intervene early enough to have a real benefit? Okay.

And then maybe in the last minute, I think there's building interest on the IGA sweeper. Can you maybe, again, just talk to the differentiation of that asset relative to everything else that's going on in that space? And maybe if I could ask about timelines there as well.

Yeah, that molecule is the, you know, it's a precision tool, and it specifically targets IGA. and what it does, it reduces IgA deep and fast. So ultimately, we will roll out an indication development plan across multiple IgA-driven diseases. We've communicated IgA nephropathy as the first indication. It's a pretty obvious one. It's also a competitive one. So we have to show, I think, those benefits in our clinical trial approach where we have to show the benefit of the fast onset of action. We have to show the benefit of the depth of the reduction because that's really, I think, what justifies the positioning of that molecule in this competitive treatment paradigm.

Okay, perfect. I think we're just perfectly at time. So, Ari and Carl, thank you so much.

Thank you, and thank you all for listening.

Thank you.