Welcome to our second quarter 2023 financial results and business update conference call. The financial press release for the second quarter of 2023 was issued a short while ago and can be viewed along with the slides for this presentation in the News and Events section of our Investor Relations site on rigel.com. As a reminder, during today's call, we may make forward-looking statements regarding our financial outlook and our plans and timing for regulatory and product development. These statements are subject to risks and uncertainties that may cause actual results to differ from those forecasted. A description of these risks can be found in our most recent Annual Report on Form 10-K for the year ended December 31, 2022, and subsequent filings with the SEC including our second quarter report on Form 10-Q on file with the SEC. Any forward-looking statements are made only as of today's date, and we undertake no obligation to update these forward-looking statements to reflect subsequent events or circumstances. At this time, I would like to turn the call over to our President and Chief Executive Officer, Raul Rodriguez.

Thank you, Ray, and thank you everyone, for joining today. Also with me today are Dave Santos, our Chief Commercial Officer; and Dean Schorno, our Chief Financial Officer. Now beginning on Slide 4. We are pleased with the progress we’ve made in the first half of 2023 as we continue to build our hematology/oncology company with our commercially available products in our development programs. In the second quarter, we continued to see year-over-year growth and demand for our first approved product, TAVALISSE, for adult product ITP. We are also pleased with the progress that we've made on the launch of our second approved product, REZLIDHIA for adult relapsed or refractory IDH positive AML. As we navigate the launch, the core focus of our commercial and medical affairs team has been driving awareness for REZLIDHIA and establishing relationships with new doctors. A few key highlights on these initiatives in the quarter include robust engagement with the medical community at the 2023 ASCO annual meeting. The presentation of promising data in the post-Venetoclax treated patients at the European Hematology Association 2023 Congress, and a second publication in Blood Advances examining the preclinical and clinical development of REZLIDHIA and its role in the treatment landscape. These are important data that we recently published and presented. Dave will touch on these items a little bit later in this presentation. Looking at our development and expansion initiatives, we've made progress in the enrollment of our Phase 1b Study of R289, our IRAK1/4 inhibitor in lower-risk MDS. And we are evaluating opportunities to expand our hematology/oncology business further with clinical development for our already approved products into new indications. Additionally, our RIPK1 program has advanced with our partner Eli Lilly, and continues to progress with the initiation of a Phase 2a trial in patients with rheumatoid arthritis in the second quarter of 2023. I will provide further updates on our progress and strategies for these efforts later on in today's presentations. With that, I'll turn the call over to Dave for an overview of the quarter.

Thank you, Raul. Now I'd like to take a few minutes to discuss our continued growth of TAVALISSE during another record quarter and our progress with the REZLIDHIA launch in the first half of 2023. On Slide 6, you'll see our FDA approved indication for TAVALISSE, which is for adult patients with chronic immune thrombocytopenia or CITP, who have had an insufficient response to a previous treatment. Moving to Slide 7, I'm pleased that we achieved another new quarterly all-time high with TAVALISSE in Q2, shipping 2,265 bottles to patients in clinics representing 10% growth over Q2 of 2022. We have now achieved three consecutive record highs for the number of bottles shipped to patients and clinics in a quarter since launch. We continue to grow our demand through a consistent flow of new patients starting TAVALISSE. And for Q2, we achieved net sales of $21.3 million, $2.8 million more than the same quarter last year, representing a 15% year-over-year increase. We are pleased with how we have grown our TAVALISSE business during the first half of 2023, and look forward to carrying this momentum into the second half of the year. We will continue to focus on targeted clinicians to identify appropriate patients who can benefit from TAVALISSE to grow our new patient starts beyond the record levels we saw in 2022. I'm grateful to the entire team for continuing our growth with TAVALISSE and ITP while we launch REZLIDHIA. Moving to Slide 8, I wanted to review the opportunity we have with TAVALISSE in chronic ITP and provide an update on our progress in moving to earlier lines of therapy. First on the left, recall that we estimate there are more than 80,000 patients with ITP and more than half of them are actively treated. While most of the patients are on steroids as their first line therapy, there are still more than 24,000 patients who are eligible to be treated after steroids and three quarters of those patients are in the second or third line. On the right, you will see how the portion of second and third line new patients on TAVALISSE has grown since 2021. For three consecutive quarters, more than 70% of the new TAVALISSE patients that we capture through our hub have been either second or third line. We are very pleased to see this consistency of earlier usage in patients on TAVALISSE over the past three quarters. As more patients are being treated with TAVALISSE earlier in their course of treatment, we expect our refill bottles to continue to grow due to the improved persistency we should see from those patients. On Slide 9, we believe the reason we have been successful in getting more of our TAVALISSE patients earlier in the treatment continuum is that our efficacy message is resonating. Clinicians are impressed that the earlier they use TAVALISSE, the better their results. And when they do use TAVALISSE, they can count on clinically meaningful and durable increases in platelet counts over time. These messages are resonating and our business is continuing to grow. We'll continue to promote the benefits of using TAVALISSE earlier after steroids and how the durable predictable platelet increases are meaningful to patients who live with chronic ITP each day. On Slide 10, a reminder that in April, our partner Kissei announced the launch of TAVALISSE for the treatment of chronic ITP in Japan. We remain committed to continuing to impact CITP patients around the globe with the expansion of TAVALISSE's commercial footprint through our partners. Moving to slide 11, I'll take a few minutes to discuss our continued progress launching REZLIDHIA in the first half of 2023. On slide 12 you'll see our FDA approved indication for REZLIDHIA, which is for adult patients with relapsed or refractory acute myeloid leukemia with the susceptible IDH1 mutation as detected by an FDA-approved test. As an introduction on Slide 13, there continues to be an unmet need for efficacious targeted treatments in relapsed or refractory AML, and in particular, agents that provide longer durations of response and an acceptable balance of efficacy and toxicity are needed. We continue to strongly believe that REZLIDHIA addresses exactly those needs. Moving to Slide 14, and our view of the currently eligible patient population for REZLIDHIA. The American Cancer Society estimates that more than 20,000 patients will be diagnosed with AML in 2023, and of those patients, our research showed that whether patients are treated with intensive therapy or not, most are refractory to treatment or relapse within 2 years. Specifically with 6% to 9% of patients having the IDH1 mutation, we believe we have a near-term opportunity to impact the lives of around 1,000 new mutant IDH1 patients in the relapsed or refractory setting each year. Slide 15 shows our continued early launch progress in bringing REZLIDHIA to those 1,000 mutant IDH1 relapsed or refractory AML patients. We sold a total of 200 bottles of REZLIDHIA in the second quarter, representing 77% growth over Q1. 187 of those bottles were shipped directly to patients and clinics, and our demand grew second quarter net product sales to $2.6 million with our total launch-to-date sales now at $4.9 million. We continue to remain focused on growing awareness of REZLIDHIA through our field teams and other activities. Moving to Slide 16, we made solid progress in Q2 on growing that awareness through both promotional activities and scientific publications. First on the left, we had a strong presence at the ASCO annual meeting in early June. It was the first major conference opportunity for Rigel to promote both TAVALISSE and REZLIDHIA, and we officially launched our REZLIDHIA 'Transform Your Expectations, Durable Remission is Possible' campaign there. To go along with that, we have updated both our HCP and patient websites with our campaign and visitors to REZLIDHIA.com have a wealth of information and resources at their fingertips. On the right side of this slide, you will see the significant progress we have made on the scientific front in Q2. First in May, there was an excellent review article published in Blood Advances discussing the positioning of REZLIDHIA in the mutant IDH1 AML treatment landscape. In the conclusion, the authors recommend olutasidenib in Venetoclax plus HMA failures given the available data. The data they were referring to was also presented this quarter at the European Hematology Association 2023 Hybrid Congress held in Frankfort during June. That poster focuses on this very clinically relevant population of patients who were previously treated with Venetoclax. The conclusions were very consistent with our previously reported results. The authors wrote that olutasidenib induces durable remissions and that the observed activity is clinically meaningful and represents a therapeutic advance in the treatment of this molecularly defined poor prognosis patient population with relapsed or refractory mutant IDH1 AML. Our commercial and medical affairs team members have had several recent discussions with key academic leukemia specialists since that data was presented in June, and they have expressed the same sentiments as the authors. They view the data as promising and interest in olutasidenib continues to grow. Overall, we made significant progress during Q2. And importantly, some key drivers to the olutasidenib story, such as the compelling activity in post-Venetoclax patients just began at the end of the quarter. In addition to those key drivers in late Q2, on Slide 17, we have other activities planned for the second half of this year that we expect will enable us to continue building momentum with REZLIDHIA. First on the left. We now have the institutional team we announced last quarter in place. Recall that a significant portion of our AML business is concentrated in academic institutions and the leukemia treaters in these key leukemia centers influence how the community treats AML. We hired eight institutional business managers across the country who will be accountable for leading REZLIDHIA promotional activities with these top leukemia treaters and facilitating formulary placement at key leukemia centers. They have impressive experience. On average, the members of this team have more than 19 years of heme/onc experience with 14 of that calling on hospitals. They're also experienced in other key commercial functions including sales management, market access, marketing, KOL development, and key account management. I want to warmly welcome them to the REZLIDHIA team. I'm looking forward to reporting on their accomplishments as we move forward. In addition to the institutional team, we continue to schedule and complete more peer-to-peer speaker programs, improve our presence at key leukemia and hematology conferences, and we'll be utilizing timely non-personal promotion through innovative channels during the second half of the year. And of course, we will continue to maximize access for patients through our hub and other patient and HCP resources. On the scientific side, we're planning additional publications from the Phase 2 trial, highlighting more key mutant IDH1 relapsed or refractory patients, along with the post-Venetoclax population, as well as providing more olutasidenib evidence from populations outside of our pivotal cohort. In addition, we'll be working to generate supportive data in difficult-to-treat mutant IDH1 relapsed and refractory patients to bolster our current story. And finally, our medical affairs team will continue to provide relevant information and education for HCPs involved in AML treatment and gather insights from the KOLs to deepen our understanding of where else we may need to develop olutasidenib. Overall, we're looking forward to building additional momentum with all of these initiatives as we move through the second half of 2023. And finally on Slide 18, after our experience during the first 6 months of the launch, we believe now more than ever that REZLIDHIA has the potential to address many key patient and HCP needs in relapsed refractory AML. It's a promising treatment targeting mutant IDH1 that has shown impressive durable responses if patients who fail previous therapies. Overall, we continue to see exciting potential to become a market leading treatment in mutant IDH1 relapsed refractory AML and are looking forward to continuing to execute our launch plan. My thanks to the entire team for all their efforts during the first half of 2023 with REZLIDHIA, and I look forward to providing you with additional launch updates in the future. Thanks for your attention. And I'll now turn the call back over to Raul to provide a brief update on our development progress.

Thank you, Dave. I will now summarize our development programs. Moving on to Slide 20. Thank you. We outlined our ongoing development programs. We are focusing on growing our heme/onc business with our internal development plans. We believe both fostamatinib and olutasidenib have potential in other diseases beyond their already approved indications, and we're currently evaluating several options. In addition, we are evaluating potential in-license opportunities similar to the approach we took with REZLIDHIA. Our ongoing Phase 1b study of R289, IRAK1/4 inhibitor in patients with lower-risk MDS continues to progress well. We have completed enrollment in the targeted number of patients in the second cohort of the trial and expect to begin enrollment in the third cohort in the near future. I will touch more on this program in a minute. More opportunistically, our partner Eli Lilly is advancing R552, our RIPK1 inhibitor with the initiation of their Phase 2a study in rheumatoid arthritis. As a reminder, this study will enroll approximately 100 patients with moderate to severely active rheumatoid arthritis. And the analysis is expected at the end of 2024. Moving on to Slide 21, I wanted to spend a few moments discussing the treatment landscape for lower-risk MDS and how we think about our IRAK1/4 inhibitor, R289 and how it could address an unmet need for background. MDS is a disorder of hematopoietic stem cells resulting in dysplasia and ineffective hematopoiesis in the bone marrow. For patients with lower-risk MDS, risks include autoimmune abnormalities, cytopenias progression to AML, and death. Patients undergo treatment via blood transfusions or Erythropoiesis-Stimulating Agents or ESAs for anemia in the first line setting, followed by Lenalidomide, Luspatercept, HMAs, and immunosuppressive therapies in the second line setting. But durable responses in this setting are not common. Subsets of patients show limited hematologic responses, and these agents result in significant adverse effects. Loss of response following second line therapy represents a poor prognosis for patients, associated with significant morbidity and cytopenias. So there remains a significant unmet need for lower-risk MDS patients who are refractory or resistant to current therapies. And we believe R289 has potential to address this need in this underserved patient population. On Slide 22, you see our ongoing open-label Phase 1b study of R289. As mentioned, we have completed enrolling the targeted number of patients in the second cohort of the trial and expect to begin enrollment of the third cohort in the near future. Moving on to Slide 23, we continue to evaluate fostamatinib and olutasidenib in additional indications beyond their approved indications. Working with KOLs and regulators, we are evaluating these programs across multiple indications, lines of therapy, and treatment regimens, as well as conducting market research to help inform our plans moving forward. We look forward to providing additional updates on these initiatives later on in 2023. Regarding our business development efforts related to the in-licensing of new assets, we are continually evaluating assets that are synergistic with our existing heme/onc infrastructure and that are complementary or adjacent to our already approved products. We are focused on programs that are in late-stage clinical development, in review for potential approval, or in the early stages of commercial launch. With our development capabilities and commercial infrastructure, we have the potential to grow our business from internal programs as well as being the potential commercial partner for in-licensed or acquired heme/onc products. With that, let me turn the call over to Dean for a financial update.

Thank you, Raul. I'm on slide 25. For the second quarter of 2023, we shipped 2,191 bottles of TAVALISSE to our specialty distributors, resulting in $30.2 million of gross product sales. 2,265 bottles of TAVALISSE were shipped to patients and clinics, while 74 bottles decreased the levels remaining in their distribution channels at the end of the quarter. For the second quarter of 2023, we shipped 200 bottles of REZLIDHIA to our specialty distributors, resulting in $3.2 million in gross product sales. When 187 bottles of REZLIDHIA were shipped to patients and clinics or 13 bottles increased the levels remaining in our distribution channels at the end of the quarter. We reported net product sales from TAVALISSE of $21.3 million in the second quarter of 2023, a 15% increase compared to the same period in 2022. We reported net product sales from REZLIDHIA of $2.6 million in the second quarter of 2023. Our net product sales from TAVALISSE and REZLIDHIA were recorded net of estimated discounts, chargebacks, rebates, returns, co-pay assistance, and other allowances of $9.6 million. For the second quarter of 2023, our gross to net adjustment for TAVALISSE and REZLIDHIA was approximately 29.5% and 20.7% of gross product sales, respectively. Before we move on from net product sales, let me review our expectations for the third quarter of 2023. We are pleased with the strength of our business in the second quarter, and expected to see continued strength in our year-over-year total net product sales growth rate as bottles shipped to patients and clinics continue to grow across our business. Incrementally, we expect a gross to net adjustment for the third quarter of 2023 to be approximately 31% for TAVALISSE and approximately 21% to 22% for REZLIDHIA. On to the next slide. In addition to net product sales for the 3 months ended June 30, 2023, Rigel's contract revenues from collaborations were approximately $2 million, of which $1.2 million was from the delivery of drug supplies, and $800,000 was from royalties from our collaboration agreement with Grifols. We also recognized $1 million in government contract revenue related to income recognized pursuant to the agreement with the U.S. Department of Defense to support our Phase 3 clinical trial of fostamatinib in high-risk hospitalized patients with COVID-19. Moving on to cost and expenses, our cost of product sales was approximately $1.1 million for the second quarter of 2023. Total costs and expenses were $32.2 million in the second quarter of 2023 versus $42.8 million in the second quarter of 2022. The decrease in cost and expenses was primarily due to trial completion activities related to the Phase 3 clinical trial for warm autoimmune hemolytic anemia and the Phase 3 clinical trial at high-risk hospitalized patients with COVID-19 as well as timing of activities related to our IRAK1/4 inhibitor program. But we did see a significant drop in operating expense during the quarter. We're expecting operating expenses in the back half of the year to return to at least the first quarter of 2023 levels, as we expect to both further our current clinical efforts and expect to be ready for the initiation of new clinical studies as Raul described. We look forward to providing updates on these potential studies in upcoming quarters and will continue to provide operating expense updates along the way. We ended the quarter with cash, cash equivalents, and short-term investments of $64.4 million.

Thank you, Dean. As we discussed on this call, we had a productive first half of the year, and we are focused on our 2023 goals. In the second quarter, we surpassed our previous high in demand for TAVALISSE, and we are eager to maintain the momentum for TAVALISSE sales in ITP, both in the U.S. and globally with our partners. We are moving forward with the launch of REZLIDHIA for relapsed refractory AML. With our academic institution-focused sales team now in place and several recent publications and presentations about REZLIDHIA, we are well-positioned to raise awareness of this product as a new treatment option. Additionally, we are looking for collaborators outside the U.S. for this product. We will continue to evaluate new opportunities for both fostamatinib and olutasidenib, advance our R289 Phase 1b Study, and actively seek business development opportunities. Thank you for your interest in the second quarter, and we will now open the call to your questions.

Thank you. Our first question is from Yigal Nochomovitz with Citi. Please proceed with your question.

Hi, Raul, and team. Thank you. I'm looking to better understand how you're managing the business regarding the path to profitability. This quarter seemed closest to breakeven, excluding some one-time items where you showed net profit due to collaborations or milestones. You mentioned potential investments in new opportunities for fostamatinib and olutasidenib, as well as in-licensing, while the top line is also growing. Additionally, you noted that expenses might increase back to the Q1 '23 levels. Could you elaborate on all of this together? How are you planning to manage the business to reach breakeven or beyond in the coming years? Thanks.

Thank you, Yigal. Sure. Well, let me turn to Dean to give you an overview on how we're looking at this path towards breakeven and our investments further.

Hi, Yigal, and thank you for the question. Let me begin with the cash change for the quarter that you mentioned. Cash increased by $5.6 million this quarter, primarily due to strong sales, although this was partially offset by operating expenses. The operating expenses you referred to were relatively low, primarily due to the timing of our activities. Looking back a year, we concluded the warm autoimmune hemolytic anemia study and the COVID Phase 3 trials, and there was some variability in the timing of our IRAK spending. As a result, we incurred about $32 million in operating expenses for the quarter. The net loss for the quarter was $6.6 million, with $2.5 million of that being noncash, which also contributed to strengthening our cash position. Additionally, we experienced an $8.5 million increase in accounts receivable, as we had a slightly higher balance in Q1 that normalized in Q2. Overall, this resulted in a $5.6 million increase. As you pointed out, reaching profitability and establishing a clear path to profitability is crucial for us, and this quarter underscores that potential. We anticipate that in the second half, as I mentioned earlier, our operating expenses will return to Q1 levels, while we expect revenue to continue to grow. We plan to manage operating expenses effectively, and we believe this will ultimately lead us to profitability. However, we haven’t provided top-line guidance, so I can’t specify when we will achieve that crossover. Nonetheless, I want to emphasize that reaching profitability is certainly a key focus for our business.

Thanks, Dean. The only thing I'd like to add further is that it's an important priority for us. But it also is important to fund the new opportunities that both our internal as well as things we might in-license, because that continues to be a priority for both of those things. We like the business, we like the growth of the business. We want it to grow and be even greater and bigger in the future.

Okay. Thank you very much.

Thank you, Yigal.

Thank you. Our next question is from Kristen Kluska with Cantor Fitzgerald. Please proceed with your question.

Hi, everyone. Thanks for taking my questions. I found it really helpful to understand a little bit more about what you're seeing in terms of new patients. So thanks for sharing that with us. So I wanted to see if you could talk about what the compliances you're seeing amongst the different lines of treatment. And also if the responses are pretty much in line with your own analysis, since you've been tracking this for a couple quarters now.

Yes, thank you for asking that question. We're excited to share some of that information. Dave?

Thanks, Kristen. I will say that it's we don't have an ability to kind of take the patients that are on therapy in the second and third and determine response rates, if that was your question. But I will comment on kind of what we've looked at in terms of persistency. And it is still early, but what we've looked at is a patient who started in Q4 of last year when we saw this higher percentage of third and fourth line patients. And we compared it to patients who started in Q4 of '21 and Q4 of 2020. And if you look at their persistency at 4 months and beyond versus the persistency of patients who were in '21 or '20, it is trending higher. And so, we do think this is a positive trend. Again, this has only been happening for three quarters. So it's going to take some time for this to reflect in a larger number of refills. But certainly we believe our business is going in the right direction.

Okay. Thank you for that. And then you mentioned for REZLIDHIA that you're looking at potentially populations outside of what was evaluated in the pivotal cohort. Can you please just elaborate a little bit more on that?

Let me make a couple comments on that certainly. So, IDH positive patients in AML, there's numerous opportunities within IDH positive AML patients that we are looking at. Earlier line, for example, in certain sub-segments we think are interesting to study further. Some already in the relapsed refractory area where we want more data. But we're also looking in areas outside of AML where there's been shown to have some opportunities for IDH positive, a product that is an IDH positive mutant product such as REZLIDHIA.

Yes, I would just say that all of the patients in the Phase 2 if you consider outside of the pivotal cohort, I mean, some key populations that are really important to clinicians out there include patients who were enrolled with MDS versus AML. Patients who were enrolled treatment naive and patients who were on combination therapy versus a single agent. Because as you know in our pivotal cohort, it was just mono therapy and it was all relapsed refractory AML. So those are the populations that clinicians have expressed interest in. Some of the data has been presented, the combination data, but we're looking to make sure that the other cohorts' data is out there as well for clinicians to learn from.

And just to highlight, we did publish the post-Venetoclax data at the EHA meeting, which was very helpful. It was a question we frequently get. How do patients who have been through Venetoclax perform with your product? And the answer was very affirmative in that presentation.

Okay, thanks. And last question for me. I know you made it very clear that you're looking at a couple of different options on the table here in terms of next opportunities, but one that comes up pretty consistently for us is GVHD. So I know you shared some promising data earlier this year. Just wondering what the next steps are for following up with those patients in that program, in particular, I know you haven't officially declared it as a next candidate, just one that you may consider. Thanks again.

It's a very attractive opportunity. The data presented and published by our colleagues at Duke is quite compelling. This is a segment that continues to have a significant medical need, and fostamatinib may provide substantial benefits. We are currently evaluating this opportunity alongside others, such as olutasidenib, and comparing them against each other. We will need to make some decisions and cannot pursue everything. However, GVHD is indeed a very appealing option. Later this year, we will return to discuss our plans for GVHD and other areas.

Thank you. Our next question is from Joe Pantginis with H.C. Wainwright. Please proceed with your question.

Hey, guys. Good afternoon. Thanks for all the details today. So first, Raul, I'm just wondering if you could share maybe the maturity levels of your discussions to potentially in-license?

Yes, I really cannot actually because I've learned I've been in business development for a long, long time. And until the contract is signed, the contract's not signed, all sorts of things happen. But needless to say, importantly, that we're looking for heme/onc opportunities in late stage either with data or at registration, or just launched as opportunities that we are very interested in, we're particularly interested in opportunities that are a good fit with the physicians we call on. But if they're in a slightly adjacent area, say transplant, that actually may be a good opportunity as well. So we're looking at those types of opportunities a lot like with REZLIDHIA, something that we could slot into our portfolio with really only needing a minor increase perhaps in infrastructure, but fully leveraging the infrastructure we have currently in place. And we'd like to have these in place so that we can obviously launch them successfully, just like we're doing with REZLIDHIA in the not that distant future. So we're looking at those type of opportunities. I can't be more specific in terms of what they are, or certainly not the timing of that. Because it's just challenging until the contracts are done to announce anything in advance like that. But we're excited about the continued effort to look at that. We think that we have a superb heme/onc commercial capability, broadly speaking, and we'd like to leverage that for other companies and other products. So if there's a company out there listening in that has a late stage heme/onc opportunity, we'd be delighted to speak to you about it. We have a compelling reason why we should be your partner of choice to commercialize here in the U.S. So I'll add an advertisement there, Joe? Apologies.

No, absolutely. No, totally fair enough. Thank you. And then, look, I think the chart regarding the breakout in the TAVALISSE population by quarter is extremely valuable. So I think, obviously, your goal is to continue to expand the population into earlier lines. Right now it appears on the chart that you're a little over 30% in the second line population. So I guess, what would you define as your key inflection steps to be able to grow those percentage numbers?

I will ask Dave to comment on that, but let me before he does that, let me say we're delighted with the progress we've made here. Recall, quite a while ago when we launched this product, we were predominantly used in that later line, fourth plus. And now you see the evolution, it's really satisfying to see the range of patients that could benefit from TAVALISSE and hopefully they benefit profoundly.

Yes, Joe, let me clarify your question. Seventy-five percent of the post-steroid market is in the second and third lines of therapy. We estimate that about seventy to seventy-five percent of patients we track are in these lines, based on our internal data regarding their treatment backgrounds. You're pointing out that the second line is smaller in scale compared to the third line, and whether we can change that. I believe we can, and over time, we expect to see increased usage in the second line, which has been challenging since clinicians have relied on specific treatments in that area for a long time. However, it is encouraging that about a third of the patients we monitor are on TAVALISSE in the second line, indicating progress. The main objective is to increase usage by aligning with clinicians and their patients. When they observe positive outcomes, they tend to increase usage. Our most dedicated prescribers appreciate the drug, noting that when patients receive the dose, their platelet counts improve over time, prompting them to move it up in therapy. They view post-steroid patients as a significant opportunity for TAVALISSE, which has contributed to our current standing. We have a dedicated team tirelessly promoting TAVALISSE. Since the easing of COVID restrictions, our promotional efforts have been effective in reaching more patients earlier in their treatment journey. While I don't have a specific target number in mind, we are focused on expanding our second-line use while ensuring that both second and third lines remain key facets of our business.

That's very helpful. And luckily we're not testing my short-term memory now. So that's good. But if I'm thinking long-term, Dave, if I heard you correctly, I mean, even going back a couple of years ago, I think you've now translated your initial wish list to actual data supporting what you wanted to do, being able to have patients get used to the drug, coming out of COVID had to be used to the drugs, seeing the refill rates based on the platelet data and what have you. So these are real data to look at versus the original wish list you had. So I appreciate it.

Absolutely. We're happy to see these results and provide them to you.

Thanks, Joe.

Thank you. Our next question is from Eun Yang with Jefferies. Please proceed with your question.

Thank you. You provided the number of TAVALISSE units shipped or sold each quarter. Could you share how many patients were on TAVALISSE at the end of the quarter? Additionally, regarding TAVALISSE usage by line of therapy, it appears that a little over 30% of TAVALISSE is used in the second line. Given the number of eligible patients, can we assume that your penetration in the second line is currently in the mid-single-digit percentage range, and around 15% in the third line? Thank you.

I'm not quite sure I understand your calculations, but I want to emphasize that we had more new patients last year than at any other time in the brand's history, and we're continuing to see that growth this year. While we don't disclose specific patient numbers, we are pleased with our ongoing progress in attracting new patients to the brand. This data reflects our internal estimates based on the patients we engage with and their treatment lines, but projecting this across the broader market isn't something I would do at this moment. We're sharing our internal data and are satisfied with the clear trend, which is why we wanted to bring it to your attention.

We have observed this over several quarters, which is why it wasn't presented earlier. We wanted to ensure it showed some consistency, and you can see that it is starting to approach that. However, there are some limitations; this data reflects only a subset of patients that go through our hub, and we cannot capture all patients in the market. Nevertheless, the trend is evident, and we hope it will continue to grow, providing more opportunities for growth in the second line.

Thank you.

Thank you, Eun.

Thank you. Our next question is from Allison Bratzel with Piper Sandler. Please proceed with your question.

Thank you. Thanks for all the detail on today's call, and thanks for taking my question. Maybe first one on the pipeline just for R289 and lower-risk MDS and that initial readout slated for this year. Just considering that update should include the first few dose cohorts, could you kind of frame what you would view as a successful readout there? And then just second, following up on a prior question and prior discussion about cash burn and breakeven point, could you help us maybe understand what's gating to providing revenue guidance, at least on the TAVALISSE front now that it's in your launch? How should we be thinking about that, the potential for that heading into next year and going forward? Thanks.

I will have Dean address the second question, but I'll respond to the first. The low-risk MDS Phase 1b Study is currently in progress, and we have completed enrollment for the required number in both Cohort 1 and Cohort 2. We believe these lower dose cohorts might not be sufficient to observe significant efficacy responses. Their primary purpose is safety, though there is a chance we could see some hematologic improvements. However, the focus is mainly on safety for these initial cohorts, and so far, things are looking positive. We plan to discuss with the FDA about advancing to Cohort 3 and Cohort 4, where we expect to identify better efficacy signals, alongside maintaining safety. We aim to provide updates on the lower cohorts since they are already enrolled, and we expect to have additional data by the end of the year. For the other cohorts, if we can begin enrollment, we may need to wait several months, possibly up to six, before we see any efficacy signals from the higher dose groups. Therefore, it is unlikely that we will have results this year, with a more probable timeline set for next year. Dean will now provide guidance.

Sure. Regarding our guidance, it's important to highlight that our top line is driven by TAVALISSE, which is consistently growing quarter-over-quarter. We see the potential to offer guidance based on that singular data point. As for the rest of our top line, AML is still in its early launch phase, and we have discussed various initiatives expected to create momentum in that area. Additionally, we have royalty revenues and collaboration revenue, which can vary. Although we anticipate some significant payments over time, all these factors play a role in our top line guidance. We do not plan to provide a top line forecast in the near term until we have more specificity and clarity regarding REZLIDHIA. In terms of reaching breakeven, the top line is crucial, and as Raul mentioned, we are exploring further development of fostamatinib and olutasidenib as we finalize our incremental study plans.

Great. Thank you.

Thank you, Allison.

Thank you. Our next question is from Kalpit Patel with B. Riley Securities. Please proceed with your question.

Yes. Hey, good afternoon. Thanks for taking the question. One more on R289. I know you just mentioned that the focus there is just on safety for the first two cohorts. But would you plan on showing any sort of biomarker data. Hemoglobin tends to increase early on with some of these competing agents. It just might be useful to see any sort of evidence of preliminary clinical activity, even if there's a trend.

Yes. It's just too early, we haven't actually analyzed all the data yet. And so we do want to share the information on the first two cohorts. So I can't make a comment because I don't know what we'll see there. But we certainly will share some of that as we get it. But like I said, I think really we'll just need to wait till next year to see Cohort 3, Cohort 4 data that will be more compelling data.

Okay. And then for your plan to potentially in-license additional heme/onc assets, could you give us a little more color on how you might be thinking about financing or structuring such transactions, given your current balance sheet.

Yes, we are exploring several options for this. It's essential that we focus on a late-stage opportunity that does not require significant clinical investment, allowing for a fast track to approval and market entry. We anticipate that this product will be highly synergistic and will effectively utilize our existing commercial capabilities without necessitating substantial additional investment, leading to quick accretion post-launch. These factors are critical for the product. In the heme/oncology sector, we often find multi-niche categories with several products targeting smaller patient populations, such as REZLIDHIA. This is the direction we are pursuing, and we believe it will enhance the economic outcome. However, we haven't progressed enough to provide detailed information yet, but once we announce the product, we will certainly outline our financing strategy for such an acquisition.

Okay, got it. And one last question on REZLIDHIA. Do you anticipate to make any milestone payments related to the acquisition in the next 12 months, maybe commercial related milestones?

We certainly have royalty payments that we will make, and happy to make them. But I don't think there's anything of substance and certainly we'll look at it, but I don't recall anything of substance in the near-term.

Okay, thank you.

Great.

Thank you. There are no further questions at this time. I'd like to hand the floor back over to Mr. Raul Rodriguez for closing comments.

Thank you, operator for your help today. In closing, I'd like to thank everyone for joining us on the call and your continued interest in Rigel and what we're doing. But I'd also like to take a moment to thank our employees for their continued commitment to improving the lives of patients, some with diseases as awful as AML because everyday does count and they certainly keep that in their minds as they work very diligently and moving these products and projects forward. So thank you for that. I look forward to keeping you updated on future calls. Have a good afternoon or evening.

This concludes today's conference. You may disconnect your lines at this time. Thank you for your participation.