Genmab A/S Q1 FY2022 Earnings Call

Hello, and welcome to the Genmab Q1 2022 Conference Call. Throughout the call, all participants will be in listen only mode. And afterwards, there will be a question-and-answer session. Just to remind you, this conference call is being recorded. During the telephone conference, you may be presented with forward-looking statements that include words such as believes, anticipates, plans or expects. Actual results may differ materially. For example, as a result of delayed or unsuccessful development projects. Genmab is not under any obligation to update statements regarding the future, nor to confirm such statements in relation to actual results, unless this is required by law. Please also note that Genmab may hold your personal data as indicated by you as part of our Investor Relations outreach activities in order to update you on Genmab going forward. Please refer to our website for more information on Genmab and our privacy policy. Today, I’m pleased to present Jan van de Winkel. Please go ahead with your meeting.

Hello and welcome to the Genmab conference call to discuss the Company’s financial results for the period ended March 31, 2022. With me today to present these results is our CFO, Anthony Pagano. Let’s move to Slide 2. As already said, we will be making forward-looking statements. So, please keep that in mind as we go through this call. Let’s move to Slide 3. Genmab has an innovation-based culture, and collaborations and partnerships have always been part of our DNA. During today’s presentation, we will reference some of the products being developed under these strategic collaborations, and this slide acknowledges those relationships. Let’s move to Slide 4. I would like to begin with a reminder that thanks to a consistent and solid track record of success, our world-class team and our strong financial foundation, we have never been in a better position to achieve our ambitious vision of transforming cancer treatment. During the first quarter of 2022, we continued to build on this foundation with multiple advancements in our pipeline. So now let's move to Slide 5 and take a look at some of the recent achievements and updates. I'm excited to start with the fact that last month we and AbbVie announced top-line results from the first cohort of the Phase 1/2 study of epcoritamab in patients with relapsed or refractory large B-cell lymphoma, who have received at least two prior lines of systemic therapy, including 38.9% who received prior treatment with CAR-T therapy. In these high-risk heavily pretreated patients, epcoritamab demonstrated an overall response rate of 63.1% with a median duration of response of 12 months. The data will be submitted for presentation at a future medical meeting. And based on these results, together with AbbVie, we will engage global regulatory authorities to determine next steps. In March, we announced another important milestone for epcoritamab: the FDA has granted Orphan Drug Designation for the treatment of follicular lymphoma. So let's now turn to tisotumab vedotin. Together with Seagen, we presented tisotumab vedotin data at a number of conferences during the first quarter. Key among these presentations was preliminary data from the innovaTV 207 study of tisotumab vedotin monotherapy in patients with squamous cell carcinoma of the head and neck, who experienced disease progression on or after a first-line platinum-containing regimen and a checkpoint inhibitor. Early results show tisotumab vedotin demonstrated a manageable safety profile and promising preliminary anti-tumor activity in this patient population with the primary endpoint of overall response rate per investigator achieved in 16% of head and neck cancer patients. The findings were presented as part of a plenary session at the ASCO 2022, Multidisciplinary Head and Neck Cancer Symposium in Arizona in February. We also presented interim results from the innovaTV 205 study during a virtual oral session at SGO in March. Excitingly, as you may have seen on the ASCO 2022 websites, an abstract on the innovaTV 205 data was also accepted for all presentation at ASCO. Our clinical pipeline also expanded in the first quarter with the first patient dose in the first-in-human study of DuoBody-CD3xB7H4. The power of Genmab’s innovation was reflected in updates for therapies created by Genmab that are being developed by other companies. A variety of programs have either been added or initiated clinical studies. With regard to Janssen's product incorporating our DuoBody technology, as Janssen announced, they submitted a Marketing Authorization Application to the EMA seeking approval of the teclistamab for the treatment of patients with relapsed or refractory multiple myeloma and the U.S. FDA BLA for teclistamab in this indication received Priority Review from the U.S. FDA. Sales for DARZALEX over the quarter were also strong, and we reported US$1,856 million in net sales by J&J, an increase of 36% over the first quarter of 2021, resulting in DKK 1,501 million in royalties. This brings me to the resolution of our arbitration with Janssen relating to our daratumumab license agreement. As we announced in the beginning of April, the arbitral tribunal decided both issues in favor of Janssen. We did not seek a review of the awards, and it's now final. As the arbitration is confidential, we do not intend to commence further, and we look forward to our continued collaborations with Janssen. Finally, we expanded our executive management team on March 1st with the appointment of Birgitte Stephensen to Chief Legal Officer and Chris Cozic to Chief People Officer. These appointments elevate the critical work of the groups as well as further strengthen our world-class executive management team. I'm pleased to now turn the call over to Anthony Pagano to take you through our first quarter financial results. Anthony, go ahead.

Great. Thanks, Jan. Let's move to Slide 6. First off, as Jan just said, we're not going to comment any further on the arbitration. But as a reminder, we already assumed a royalty reduction of around DKK 700 million when we issued our 2022 guidance in February. Now with that behind us, let's take a look at Q1, where we continue to strengthen our foundation and drive towards our 2025 vision. Our first commercial launch, bringing Tivdak to U.S. cervical cancer patients, is progressing well. We grew recurring revenue by 84% in Q1. This was driven by strong royalties from DARZALEX and other approved medicines. You’ll remember, of course, that we essentially had no TEPEZZA revenues in Q1 of last year. Now, especially in these volatile times, the strength of our financial profile really stands out. Our strong balance sheet and growing recurring revenues allow us to continue to invest in our business and our pipeline in a very focused and disciplined way. And an important part of this has been to continue to build the team and capabilities to enable us to succeed. So let's take a look at those revenues in a bit more detail on the next slide. We saw continued strong performance for DARZALEX in the first quarter. You can see that in the chart. Overall, net sales grew by 36%. That's net sales of $1.86 billion, which translates to DKK 1.5 billion in royalty revenue. This exceptional growth was driven by continued strong market share across all lines and continued uptake of the subcutaneous formulation. So DARZALEX remains a key driver of our revenue as you can see on Slide 8. Our recurring revenues grew by 84% in the first quarter of the year. We've already spoken about DARZALEX and the very strong performance there. We're also encouraged by the growth of Kesimpta and TEPEZZA, where we saw an increase of almost DKK 300 million in royalties compared to last year. This growth illustrates the power of our recurring revenues. In fact, 88% of our Q1 revenue was recurring revenue compared to 64% in Q1 of last year. So our revenue profile continues to get stronger. And we're taking those revenues and investing in a highly focused way as you can see on the next slide. In line with our significant growth opportunities, total OpEx grew 53% in the first quarter, and here you can see where we invested. We accelerated our investment into our product portfolio, especially the advancement of both epcoritamab and DuoBody-CD40x4-1BB. We've also further strengthened the Genmab team to support our growth in commercialization and our expanding pipeline. That includes supporting Tivdak and preparing for the potential filing and launch for epcoritamab. Finally, we're leveraging our collaboration with AbbVie by utilizing their expertise and significant financial contributions to further expand and accelerate our partnership programs. Now, let's take a look at our financials as a whole on Slide 10. Here, you can see our summary P&L. Revenue for Q1 came in at approximately DKK 2.1 billion, that's up 34% on last year. Total expenses were about DKK 1.6 billion, with 72% being R&D and 28% SG&A. We expect our investment levels to ramp up during the year as our pipeline and launch-readiness activities continue to progress. And we again reported very strong operating profit. For me, this result is particularly impressive given the context. And why do I say that? Last year's Q1 makes for somewhat a tough comparator as it included more than DKK 400 million of milestone payments. This year, we've also increased our total investment in Q1 by more than DKK 500 million. So even considering these items, we still delivered some DKK 514 million of operating profit for the quarter. Turning now to our net financial items. Here we have income of 98 million, which was primarily driven by two partially offsetting items. First, we have the strengthening of the U.S. dollar against the Danish kroner positively impacting the value of our cash and investments. And on the other side of the ledger, we have losses on our marketable securities due to rising interest rates and some losses on our public equity investments that we made in conjunction with recent licensing deals. Then we have a tax expense of 147 million, which equates to an effective tax rate of 24%. This brings us to our net profit of DKK 465 million. So as you can see, extremely strong financial performance for the first quarter of the year. Now, before we turn to our '22 guidance, I want to take a minute to revisit our robust financial framework on the next slide. First off, let's think about our revenue profile, which you can see on the left. At the beginning of 2020, DARZALEX was our only product on the market. Today, we have five. That provides us with expected recurring revenue growth of 40% in 2022. There's a clear path to potentially expand the number of approved products with the Janssen’s BLA for teclistamab and our planned submission for epcoritamab this year. Taken together, we expect significant cash inflows for us in the years to come. Moving to the right, we continue to be focused in our investments as we evolve our organization for continued success. At the top of the list is accelerating and expanding the development of epcoritamab. Based upon the work we've done so far, and the data we've seen, including the recent top-line data, we're convinced epcoritamab is a drug that has the potential to really make a difference for patients. And epcoritamab is just one of the exciting opportunities that provide us with a compelling rationale for increasing our investment. As we told you before, if we want to see these meaningful opportunities, we've got to invest. And that's exactly what we continue to do. So with that background, let's look at our guidance on Slide 12. Driven by strong DARZALEX growth, we're updating certain aspects of our 2022 guidance. We now expect our revenue to be in a range of DKK 11 billion to DKK 12 billion, and that's an increase of 200 million to the bottom end of our range. This increase is primarily driven by higher DARZALEX royalties following the strong Q1 performance. Here, we've increased the bottom end of our guidance range for DARZALEX net sales from $7.3 billion to $7.5 billion, while keeping the upper end of our range at $8 billion. Our OpEx guidance remains in the range of DKK 7.2 billion to DKK 7.8 billion. As I previously highlighted, this investment is fully in line with our strategy and our focus on creating long-term value. Putting all this together, we're planning for substantial operating profit in a range of DKK 3.2 billion to DKK 4.8 billion. Finally, we've maintained our guidance rate for the Danish kroner/U.S. dollar at 6.4. Clearly, as we've all seen, there's been some rather significant volatility here. And that may continue. Now, to give you just a bit of color on this topic, every 10-point move in this exchange rate, relative to our guidance rate is worth around DKK 70 million in our operating income. Now to my final slide, let me provide a few closing remarks. In summary, we've had a very solid start to the year. And we continue to execute against our 2025 vision. We've created growing recurring revenue streams and that gives us a strong backbone of significant underlying profitability. And we're investing those revenues in a highly focused way to realize our vision and to capitalize on the very significant growth opportunities in front of us.

Thanks, Anthony. Let's move to Slide 14. Our key priorities are essential to our success. And thanks to the excellent work and tireless dedication of our team members, we are on track to meet these goals. We will continue to focus on resources progressing, expanding and developing our world-class antibody product pipeline and on further scaling our organization based on our plans, innovative portfolio developments. We very much look forward to providing you with updates on our clinical programs over the course of this year as we continue to evolve into a leading fully integrated biotech innovation powerhouse. Let's move to our final slide. That ends our presentation of Genmab's first quarter 2022 financial results. Operator, please open the call for questions now.

Our first question comes from the line of Peter Virgil with Citi.

Peter Virgil, Citi. And Anthony, thank you for the clarification in terms of the FX. My only question then is, Jan, anything incremental, you can say on the ongoing HexaBody-CD38 dose escalation study, as well as the timelines for the FASPRO head-to-head and the DLBCL studies I believe are part of the requirements related to the J&J potential opt-in?

Thanks, Peter, for the questions. HexaBody-CD38 is going very well. We are still testing out some different doses for HexaBody-CD38. In the second half of this year, we are going to initiate the head-to-head against subcutaneous daratumumab in multiple myeloma patients and probably the diffuse large B-cell lymphoma cohort will probably be added next year, Peter. So we will hope to progress first the multiple myeloma head-to-head against subcutaneous daratumumab.

Our next question comes from the line of James Gordon at JP Morgan.

Hello, James Gordon from JPMorgan. My question is regarding your confidence in the epcoritamab filing. I have two parts to my question. For relapsed/refractory DLBCL and follicular lymphoma, how will the data you plan to file differ from what we’ve already seen? Will you need to enroll more patients or require additional follow-up, or is the data you've shown sufficient for filing? The second part of my question is whether you've had any interactions with the FDA following their comments, particularly regarding their stance on blood cancer drugs and single-arm studies. Are there any concerns that the FDA may be stricter on single-arm studies, or is that not a concern for you?

Thanks, James, for the questions. On epcoritamab, the potential filing of epcoritamab, we are very excited about the data. There will be data you have seen in the top-line results, James. There are data we are going to present at a conference and also share with the FDA and the other regulators. I can assure you that a lot of data you haven't seen yet. This is a very heavily pretreated population. We have not shared anything yet on complete responses, duration, et cetera, or dose responses and other aspects in the dataset. So we believe the dataset is very encouraging. We have scheduled meetings with the FDA on this data. We believe that because of the unmet medical need here and the strength of the data, we are very encouraged by the prospect of moving this forward towards a filing. I don't think that it's necessarily impacted by the stringent way the regulators have looked at PI3-kinase inhibitors recently. This is a very different situation. Of course, we need to see the feedback from the regulators. We also plan to move forward in other territories besides the U.S. with this data. We can't wait to share that with you and others at a medical meeting, which will hopefully be in the middle of this year. We are very excited about sharing the data with the medical community. I think we have caught up quite a bit with some of our competitors like Roche and Regeneron. The dataset continues to be very strong, and we are also going to share other data on epcoritamab, for example, at ASCO and several other meetings in the coming time. It's data on combination therapies and different settings which we are very excited about. So now I believe epcoritamab is developing very well, and we are highly encouraged by the data. That's probably I shall leave it at, at this time. Thank you.

Our next question comes from the line of Wimal Kapadia at Bernstein.

So kind of coming back to the HexaBody-CD38. So just Jan, I want to get your view on what's the real unmet need for a superior CD38 in myeloma? No doubt it’s pretty good. How much higher can you actually push the efficacy ball? Is it a case of a year on PFS in first-line, could it be more? And then just tied to that, is it really then the non-myeloma indication which could be the more interesting opportunity?

Yes, thanks, Wimal, for the questions. We believe that with a molecule which is at least tenfold and in some experiments 100-fold more potent than daratumumab, there is actually room to really push the responses further. For example, Wimal, when you look at the data of daratumumab monotherapy versus teclistamab, the CD3 BCMA bispecific created, the DuoBody technology from Janssen, the data from teclistamab is a lot better than the monotherapy daratumumab data. I think there is room to further improve on the efficacy of daratumumab, for sure in multiple myeloma, and even better in other indications like AML, diffuse large B-cell lymphoma. Potentially, the biggest impact HexaBody-CD38 could make is in solid cancers because there’s still very strong data, Wimal, in the effect of anti-CD38 antibodies and actually stimulating the immune system to attack cancer in animal models, that has not yet led to convincing data in the clinic with daratumumab and also not with Sarclisa from Sanofi. But I think a much better molecule which can actually kill tumors with lower levels of expression of CD38 is exactly what we see with HexaBody-CD38 in the laboratory. It could be very meaningful, I think, to broaden the market. We also see very good possibilities in multiple myeloma, and I think that is shared with what Janssen is seeing. We have very open interaction with Janssen and we share the data of HexaBody-CD38 with them. What could also be a possibility is to develop the candidate therapeutic, Wimal, in other indications like autoimmune diseases because remember, we had fantastic data in the early 2005-2006 timeframe in SCID RA models and other autoimmune models with daratumumab. Janssen never developed it in autoimmune, which may be related to the difficulty in dosing as different doses are needed in cancer therapy versus autoimmune diseases. A completely novel drug targeting CD38, which is working well and is super potent, could have the biggest opportunity in diseases outside of cancer. This is speculative as we speak, but we're super excited about what we see in the data, Wimal. We're going to share that with you, the dose escalation data, hopefully at the end of the year, along with some early head-to-head data against subcutaneous daratumumab, which is arguably one of the most successful medicines ever developed. I heard recently that this is the fastest launching medicine ever in hematology, daratumumab. It's a good hurdle to beat Wimal, but I think if there's any molecule, which has the potential to do that targeting CD38, it's HexaBody-CD38. We're really encouraged by what we see. What I told you already in December last year is that the safety profile looks very, very good and clean, which is what we were most worried about, not the efficacy. We can't wait, Wimal. This is going to be a very good year concerning clinical data from Genmab; I can assure you.

And our next question comes from the line of Peter Welford at Jefferies.

It's actually a sort of contract legal question. I noticed that the reports of epcoritamab use the CD20 antibody that's derived from Medarex. If I recall, all of the coritamab technology came from Medarex. I only mean to ask if the number of paid-up initial licenses to Medarex has expired. Which products, if any, in your pipeline are now potentially eligible for royalties related to the Medarex technology, if that still applies? Apologies if that's completely off base, but I'm wondering if you could outline your obligations under that intellectual property.

Thanks, Peter, for the question. I don't know whether we have any slots left under the original Medarex agreement. I don't know whether that's actually public information. We may have to come back to you and others on that. But what I can tell you is that we use a variety of technologies now, also other technologies to create antibodies, which can be the basis for the next generation antibody-based therapeutics, which is outside of the original Medarex contract. Some of the options we received for free came because we gave Medarex shares in Genmab in '99 when we founded the company. I don't know whether for epcoritamab, we're in any royalties for it to Medarex because it may have been one of the free slots we no longer have to pay any royalties on. But I will definitely check that. If that is public information, Peter, we will get back to you and others on that. I believe we still have some remaining slots under the original Medarex agreement, but I do not know whether we have used them for all our candidate therapeutics. The volume of new antibodies being created by Genmab is growing tremendously. We have invested significantly in strengthening our pipeline. As an innovation powerhouse very much focused on science, I can assure you that we are going to expand the clinical pipeline this year, as well as in the coming years with novel candidates. None of those molecules are traditional human antibodies from technologies like Medarex any longer; they're based on our new technology platforms. Over 50% of our pipeline right now is based on the DuoBody technology, with about 30% on the HexaBody technology, and you will see new HexaBody molecules move into the clinic soon. The remaining part of the pipeline consists of ADCs, not only with toxic payloads, but we also now have a preclinical pipeline for immune-stimulatory ADC concepts. We have never been more excited on the pipeline, but I do not have the exact answer on how many slots are left. Sorry.

Our next question comes from the line of Michael Schmidt at Guggenheim Securities.

I had a bigger picture question as well. Jan, I guess, to what degree does the outcome of the Janssen arbitration, in particular, the ending of the DARZALEX royalty payments now in the U.S., at least in the late? To what degree does clear visibility on that perhaps impact your longer-term R&D strategy? Or does it impact your aggressiveness to move new projects forward? Or perhaps even your business development strategy longer term? Thanks so much.

Thanks, Michael, for the question. I can tell you it will have very minimal impact on our strategy because we already have a very aggressive strategy. Epcoritamab will be an important string factor, of course, in the early 2030s, Michael. To really keep the same growth, the compound annual growth rates, we are building up now with the very strongly increasing recurring revenue streams over the coming years until the early 2030s. And daratumumab, of course, plays a key role in that. We believe that we have the pipeline which will allow us to accelerate some of the programs like, for example, the BioNTech partnered bispecific programs massively in the coming years. All models predict we'll be able to fill in the hole created by the loss of the income from daratumumab very well. We will try to add other antibody programs and public programs as rapidly as we can. We will increase the number of INDs we start per year in the coming years to keep filling that pipeline because that has been one of our strengths at Genmab, creating strong therapeutic candidates. We have an unparalleled hit rate in molecules we brought into the clinic, and several of them are on the path to becoming blockbusters or multi-blockbuster candidates. We're very good at this and I expect to see more improvements in efficacy, as we continue to bring products that can meaningfully impact the lives of patients. I have never been more excited about the pipeline than I am today. This year, we will share data on some of our younger clinical programs. Yes, all these could be used to continue growth rates up to the early 2030s to the end of the 2030s. We’re very, very excited and I don’t think the verdict of the arbitration will make any difference to that. It has not slowed down our ambition level; it actually has stimulated it from here.

Our next question comes from the line of Asthika Goonewardene of Truist Securities.

I kind of want to build on James Gordon's question a little bit here and maybe ask it differently. How confident are you that the data you have in hand right now can be the basis of a filing and potential approval of epcoritamab? And then would this be in sort of a general all-comer third-line plus DLBCL population? Are you specifically going to go after a subgroup like CAR-T progressors? If I can also just be cheeky in adding, can you talk about what the prespecified efficacy threshold was for this study?

Asthika, thanks for the questions. We need to be very careful until we have spoken with the regulators to give you any sort of color on the confidence level. But what I can tell you is that we are super enthusiastic about the data ourselves. We have discussed them with independent experts in the field. This is one of the most heavily pretreated populations of large B-cell lymphoma patients. There is actually no good comparator data. We need to await the interactions with the regulators, which have already been scheduled before I can give you any color on confidence. Internally, our confidence is very high. The independent consultants are very enthusiastic about the data. This is unprecedented data. We don’t know yet whether that will be good enough for a filing in the different territories. Nor can I tell you what the exact indication is that we will be seeking if the regulators are positive about the data, but we will let you know. The top-line data is already released and we will inform you via a press release about our next steps after we receive feedback from the regulators. We are still very, very confident that we can move forward with a potential filing in the second half, not much later than Roche and/or Regeneron. We are excited about the competition in the upcoming years and helping as many patients as possible.

Our next question comes from the line of Xian Deng of Berenberg.

I actually have a question on DARZALEX regarding potential future competition. The CAR-T from J&J and Legend has been approved. They are doing a range of studies, and I noticed one of the study constitutes is to compare versus DARZALEX combination. Just wondering, do you think that could be a competitive threat to DARZALEX in the future?

Thanks for the question. We never know, of course. I think what Janssen is doing is broadly developing different combinations in multiple myeloma. I was speaking with one of the Janssen colleagues, and they’re very enthusiastic about teclistamab, the molecule I referred to, which has similar efficacy as some of the CAR-T approaches. I can tell you that will be combined with daratumumab, and CAR-T is sometimes combined with daratumumab in trials to really see the best regimen. Janssen is actively thinking about sequencing and the order of different therapies because an anti-BCMA therapy can only be used once. Maybe it's better to start with a CD38 therapy with daratumumab and then follow it up when the tumor relapses with a CAR-T. I have not heard of any plans to replace daratumumab; most of the plans are combinations with daratumumab, not competition. I think they're exploring the area. You might want to ask Janssen about their long-term strategy. They're pretty happy with how daratumumab is developing. It’s the most successful hematology product launch in history, so we couldn't be more pleased with daratumumab's performance. The perfect competitor to daratumumab we are developing ourselves is HexaBody-CD38. We have never seen a more potent molecule. Yes, CAR-T is effective, but very labor-intensive and expensive, certainly not ready for prime time in community healthcare centers. The biggest market will be multiple myeloma definitely in frontline settings. Are we intimidated by them in one trial against daratumumab? No, absolutely not. I think it’s good to explore.

Our next question comes from the line of Charlie Yang at Morgan Stanley.

This is Charlie Yang speaking on behalf of Matthew. Regarding the 4-1BB combinations, could you provide more clarity? Do you still plan to present that data this year, or will there just be an update on the program along with the data presentation in 2023? What is the realistic expectation for potential launch timing? If everything goes well, when can we anticipate the product launch? Will it be in 2024, 2025, or later?

I can assure you that both the 4-1BB and targeted bispecific programs are going very well. We have multiple cohorts actively recruiting patients as we speak. We believe that for either the CD40 4-1BB or the PD-L1 4-1BB programs, we can take a decision in the coming months to move them forward to late-stage clinical development. We believe we are in a position to share data for both programs this year. Whether that will be at a medical conference, we do not know. Response rate and depth of response are important, but so is the duration of response. We can't determine how much duration data we will have for the different arms of these two bispecific programs. It is possible to have a limited data scenario from these programs this year, and extensive data at a prestigious medical conference next year, but you will hear from us about accelerating the programs to the next stage of clinical development. It's premature to discuss the timeline for potential approval for either program because much depends on where we see the responses and in what line of treatment we will see those responses. With the FDA FrontRunner program encouraging earlier movement into frontline treatments, we believe there’s potential for the CD40 4-1BB to move into frontline in one of the cancers based on solid data. Yes, 2024-2025 sounds ambitious but possible. Let’s come back this year after we get data with some firmer estimates on timelines. We are very enthusiastic about both bispecific programs and anticipate great data this year.

We have one further one in the queue so far. That's from Yaron Werber at Cowen.

Jan, I have a question that’s sort of interrelated; it’s two parts. The first one is, the Halozyme patents or at least some of them in the U.S. expire in '27, in Europe in '24. What connotation, if any, does that have on your share of royalties on DARZALEX before the expiration of those patents? The second part of the question relates to best commercial efforts in your relationship and deal with Janssen, where their patents on FASPRO obviously won’t expire until 2036. So it gives them a long horizon to expedite development to market. But they need to be on some kind of a clock based on best commercial efforts. Can you talk about that at all?

These are two very sharp questions, Yaron, and thank you for following us very actively. I’m pleased with that. As it relates to the Halozyme patents, I cannot share any further information because it essentially boils down to the Johnson contract with Halozyme, and I don't have insight into that contract. The lawyers have seen that information. You will need to ask J&J for specifics. The best commercial effort question is probably one better reserved for J&J as well. I cannot discuss that, as the lawyers may have issues afterward. You are welcome to engage with us, and we look forward to meeting you in person now that we are entering the post-pandemic era.

Our next question comes from the line of Jonathan Chang at SVB Securities.

Hi guys. This is an unnamed analyst on for Jonathan. Just wanted to ask, are we still expecting to see data in the second half for GEN3009 and GEN3014? Could you help set expectations for those data readouts?

Let me clarify GEN3009 and 3014, the CD37 and CD38 programs. Yes, definitely you will get data for both for the dose escalation of HexaBody-CD37 and for the HexaBody-CD38 program. You will get data at a medical meeting from the dose escalation and probably for the CD37 program, hopefully some early data from the combination with epcoritamab which preclinically synergizes greatly. For the HexaBody-CD38 program, you will receive data from the dose escalation and maybe some very early data from the head-to-head against subcutaneous daratumumab.

Our next question comes from Asthika Goonewardene of Truist Securities.

Jan, I initially asked you about GEN1046 and 1042, but let me get back on that. Can you talk about the development strategy here of these two assets? Do you see much overlap between these two? Or are you looking to develop them in some very unique indications? What about the FDA’s interest in pushing companies to go frontline? It’s essential to appreciate that here with these two assets.

Thanks, Asthika. Regarding GEN1042 and 1046, it is too early. We don't know yet whether we can position both bispecifics into different indications. Right now, we are testing different combinations. As you know, we're evaluating front-line treatments in melanoma, lung cancer, head and neck cancer, and pancreatic cancer with 1042, combining it with pembrolizumab or chemotherapy in these different settings. For 1046, we have 12 cohorts across different tumors, combining some with pembrolizumab and others with chemotherapy using Taxotere. It’s too early to discuss positioning. We notice differences in safety profiles; 1042 seems a bit cleaner than 1046. We believe both may find a place in solid cancer therapy. We are very excited and think this year will be crucial in determining the positioning of these molecules. Regarding the FDA FrontRunner program, introduced recently, this is a change from the FDA, emphasizing the desire to move to front-line treatment rather than using accelerated approvals for late-stage patients with no treatment options. With this program, we can use surrogate endpoints, which can lead to quicker readouts for frontline therapies rather than waiting long durations for overall survival data. We see immense potential for both GEN1042 and 1046 in this new regulatory framework.

And we have one final question, that's from the line of Matthew Harrison with Morgan Stanley.

Hi, this is Charlie Yang for Matthew. If you could tell us a little bit more about the health of the B7H4 molecule and its competition with current ADCs in development, and whether you're looking at other kind of B7 targets such as H3? Could you also reiterate your 2025 vision? Any financial guidance or other metrics you could share?

Thank you, Charlie, for the question. The B7H4 molecule is a super potent CD3 engaging bispecific, and B7H4 is a very attractive target. It's being preclinically assessed on a variety of cancers overexpressing it. In preclinical comparisons, our CD3 bispecific has outperformed a number of other approaches, including ADC approaches. We don't know yet if this will reflect better potency in the clinic, but we are highly encouraged by preclinical results, and we plan to present data at conferences this year. We will likely have dose escalation data from the CD3 B7H4 program next year as well. We are exploring other family members preclinically but haven't presented data surrounding them. It can be challenging to find truly selective and specific targets for solid cancers, but B7H4 is one such promising target. Regarding our 2025 vision, we believe we are on track to achieve it. We have never had a better pipeline than now, featuring next-generation antibody technologies. We already have one product on the market, Tivdak, which is well-received and potent. We hope to add epcoritamab next year and continue to support our vision through improving patient outcomes with our products. Our financial metrics are anticipated to meet and possibly exceed our 2025 vision.

As there are no further questions at this time, I'll hand the floor back to our speakers for closing comments.

Thank you all for calling in today to discuss Genmab’s financial results for the first quarter of 2022. If you have any additional questions, please do not hesitate to reach out to our Investor Relations team. We hope that you all stay safe, remain healthy and optimistic and very much look forward to speaking with all of you again soon.

This now concludes the conference. Thank you all very much for attending. You may now disconnect your lines.