Earnings Call Transcript - ROIV Q4 2023

Operator, Operator

Good day and thank you for standing by. Welcome to the Roivant Fourth Quarter 2023 Earnings Conference Call. At this time, all participants are in a listen-only mode. After the speaker's presentation, there will be a question-and-answer session. Please be advised that today's conference is being recorded. I would now like to hand the conference over to your speaker today, Abby Beier. Please go ahead.

Abby Beier, Speaker

Good morning and thanks for joining today's call to review Roivant's financial results for the fourth quarter and fiscal year ended March 31, 2024, along with the business update. I'm Abby Beier with Roivant. Presenting today, we have Matt Gline, CEO of Roivant. For those dialing in via conference call you can find the slides being presented today as well as the press release announcing these updates on our IR website at investor.roivant.com. We'll also be providing the slide numbers as we present to help you follow along. I'd like to remind you that we'll be making certain forward-looking statements during today's presentation. We strongly encourage you to review the information that we have filed with the SEC along with our Form 10-K for the fiscal year ended March 31, 2024, which we will file after market close today for more information regarding these forward-looking statements and related risks and uncertainties. And with that, I'll turn it over to Matt.

Matt Gline, CEO

Thank you, Abby. Good morning, everyone, and thank you for joining our fiscal year March 31 call. I'll begin with a brief overview of our topics today and then we’ll proceed through the presentation. We'll discuss our current progress in the fiscal year, which has been exciting despite being just a few months in, as well as our plans moving forward. We’ll provide updates on Immunovant, which filed their earnings yesterday and isn't hosting a conference call. We’ll review the brepocitinib data in noninfectious uveitis generated during the quarter. Additionally, we'll discuss the ongoing VTAMA launch, including the renegotiation of some of VTAMA's fixed obligations and debt that will significantly reduce the costs associated with that program. We'll also touch on upcoming catalysts and provide a financial update before ending with a Q&A session. Turning to Slide 5, we had always planned for 2024 to be a year of growth and expansion. This includes updates we’ll discuss today and exciting advancements coming through the rest of this fiscal year from Immunovant where we expect a series of important clinical data releases. We are continuing to advance our pipeline, including brepocitinib data as well as upcoming data in sarcoidosis and other areas. Dermavant is also making progress, with VTAMA’s sNDA filed for atopic dermatitis and a PDUFA date set for the end of this year, in addition to our plans for growth in psoriasis. We are actively engaged in late-stage business development activities and anticipate sharing updates on the licensed programs later this year. We also aim to finalize and communicate our plans to return capital to shareholders this year, having announced a buyback program of up to $1.5 billion and repurchased stock from Sumitomo at what we believe is an attractive price. On Slide 6, I want to express my excitement about our current pipeline and its promising developments. The VTAMA launch in atopic dermatitis is a crucial milestone for us. I have never felt more optimistic about our anti-FcRn franchise at Immunovant. The clinical data we are generating, including forthcoming data across various indications, highlights our strong position relative to the competitive landscape. Furthermore, we held a significant Type B meeting with the FDA that outlines the clinical development plan for IMVT-1402, establishing it as our lead program at Immunovant. Brepocitinib, our dual inhibitor TYK2 and JAK1, now has the best-ever demonstrated data in a Phase 2 study for noninfectious uveitis, alongside an ongoing pivotal program in dermatomyositis that positions us well in the orphan autoimmune space. We also have upcoming readouts, including namilumab in sarcoidosis later this year. Now, focusing on updates for Immunovant on Slide 8, there's been considerable progress, highlighted in the earnings release from yesterday. I want to focus on some key highlights. We successfully held a Type B meeting with the FDA regarding IMVT-1402, where we discussed critical future development topics. We are optimistic about initiating four to five potentially registrational programs for this antibody within this fiscal year. Consequently, we now view 1402 as our lead program at Immunovant. It has the potential to be a best-in-class anti-FcRn antibody, which could provide substantial value to patients. We are optimizing the development of batoclimab to inform the 1402 development plan, allowing for robust Phase 2 studies to support our pivotal program for IMVT-1402 while preserving registrational options for batoclimab if data supports it. Additionally, we have recently been issued a patent on 1402 that extends composition of matter, method of use, and manufacturing IP through June 2043, providing us with a significant time advantage for development in this area. On Slide 9, we have some program-specific updates. Notably, we are preparing to disclose details from the batoclimab study in Graves' disease this fall, accompanied by our upcoming development plan. We have seen promising data but have withheld certain details for competitive reasons until we are ready to present it this fall. Also, we expect topline data for batoclimab in Myasthenia gravis during this fiscal year, and we plan to begin registrational development in Myasthenia gravis with IMVT-1402 concurrently. We are extending the run time of the CIDP study for batoclimab by about two quarters beforeunblinding the initial data to enhance our pivotal plans for 1402. This adjustment aims to optimize dose response and ensure enrollment of the most severely affected patients. We are on track to generate potential registrational data in Thyroid Eye Disease in the first half of next year, with an expectation that deeper IgG suppression will correlate with better efficacy. On Slide 10, I want to stress the importance of deeper IgG suppression as we present new data this year. This has been consistently reflected across different anti-FcRn antibodies and indications, such as Myasthenia gravis and various autoimmune conditions, demonstrating that patients with greater IgG reduction often experience better outcomes. Thus, the data we will generate this fiscal year, particularly in Myasthenia gravis, serves as a critical proof point supporting our best-in-class claim for 1402. On Slide 11, we express our enthusiasm for Graves' disease. This indication may require a greater leap of imagination than Myasthenia gravis since there are no approved treatments yet. However, it represents an opportunity for us to provide significant clinical benefit to patients with high unmet needs. Initial data from the ongoing 24-week trial has surpassed our target response rates, with numerically higher responses seen in the high-dose 680 mg group, supporting our hypothesis of "more is better." Additionally, we’ve demonstrated best-in-class IgG reduction with a mean of 81%, significantly outperforming what's been achieved by competitors. We anticipate releasing detailed data and our development plans in the fall regarding Graves’ disease, allowing us to paint a clearer picture of its future potential. Now, I'll transition to data shared by the Priovant team on brepocitinib in noninfectious uveitis, as highlighted on Slide 14. This is an area we believe holds great promise. Noninfectious uveitis is not frequently discussed in our industry, and few therapies are currently approved. However, it is a serious condition and a leading cause of blindness among working-age individuals. Our analysis reveals about 40,000 patients with non-anterior NIU on biologics, including adalimumab, which is currently the only approved therapy. We're optimistic about the existing biologics population and are excited by the performance of our Phase 2 data, which appears to be markedly better. There are currently no competitors in Phase 3 or very few in Phase 2, indicating a substantial market potential for our differentiated product. On Slide 15, we presented data from our Phase 2 randomized dose-ranging study comparing treatment failure rates at 15 mg and 45 mg doses. We achieved a treatment failure rate of only 29% at the high dose compared to 62% with HUMIRA, which is certainly a strong indicator of potential effectiveness. This reinforces our confidence in the translatability of our data to future trials. As we highlight on Slide 19, the market for this treatment is substantial, given the urgent need for effective therapies to prevent blindness in patients. The tolerance for ocular inflammation among physicians is extremely low, and brepocitinib has shown tremendous promise as a nonsteroidal agent that effectively reduces ocular inflammation. Therefore, we’re excited about moving toward a pivotal program later this year, and we’ll provide updates as timelines become clearer. Moving on to VTAMA. On Slide 21, we noted fiscal year results reflecting approximately $75 million in net product revenue and a gross net yield of around 24% for the quarter. We expect these figures to improve over time, and we will provide additional guidance as we progress. We anticipate steady growth in psoriasis and are optimistic about a rapid launch in atopic dermatitis by the end of the year. On Slide 22, we highlighted our proven ability to transition care from standard therapies based on VTAMA’s existing performance in psoriasis. We’ve already worked with 75% of early adopter healthcare providers involved in atopic dermatitis, which positions us well in this rapidly expanding market. Additionally, we’ve successfully renegotiated debt and royalty obligations related to Dermavant, reducing potential future payments by about $300 million over the next three fiscal years. This reduction significantly lessens the expected burn rate for Dermavant, aligning with our efforts to maximize capital efficiency—both in terms of buying back shares and investing in valuable programs. Slide 25 outlines several upcoming catalysts, including the upcoming Graves' disease and batoclimab results as well as top-line data in sarcoidosis and Myasthenia gravis. We plan to initiate multiple registrational studies for 1402 based on recent positive interactions with the FDA. As we announced this quarter, our $1.5 billion share repurchase program remains in place, and we are committed to buying back shares at attractive prices. On Slide 27, although I won’t delve too deeply into early-stage drug discovery, I want to emphasize that our VantAI capabilities for modeling protein-protein interactions position us among the best in the world. We continue to fund these efforts through partnerships, including agreements with Bristol-Myers Squibb and Blueprint. Finally, on Slide 28, I want to update you on our patent litigation with Moderna. The court recently ruled in our favor on several disputed terms, strengthening our position as we enter the trial phase scheduled within a year. Furthermore, Kinevant’s Phase 2 study of Immunovant in sarcoidosis is fully enrolled, and we expect data to be available in the fourth quarter. In summary, our net cash utilization for this quarter was $108 million, thanks to streamlined operational efficiency and meaningful interest earnings on our cash. As of the end of the quarter, prior to the Sumitomo repurchase, we maintained $6.6 billion in cash. The carrying value of our debt will soon reflect the renegotiation with Dermavant in upcoming reports. In closing, beyond the catalysts discussed, we are excited about the data and opportunities on the horizon, as well as pipeline growth that we look forward to updating you on in the future. Thank you for your attention, and I’m looking forward to your questions.

Operator, Operator

Thank you. Our first question comes from the line of David Risinger with Leerink Partners. Your line is now open.

David Risinger, Analyst

Yes. Thanks very much and thank you for all of the updates. So I just wanted to ask a little bit more about batoclimab's readout. So could you please add some more color on what was surprising in the CIDP trial? And I guess whether your level of confidence for that asset and CIDP is unchanged. And then also if you could discuss the slight delay in the MG readout for batoclimab, that would be helpful as well. And then separately, Matt, you mentioned the very unique modeling capabilities you have for protein-protein interactions. Is that solely for facilitating larger drug companies' drug development via partnerships or would your organization ever design its own drugs with those capabilities and patent drugs to be developed by Roivant. Thanks very much.

Matt Gline, CEO

Yes. Thanks, Dave. Those are great questions and I appreciate them. I'll start with the Immunovant questions. First of all, I want to be clear. We haven't seen any of the data for either batoclimab in MG or batoclimab in CIDP and certainly, the biology continues to be supportive. The competitive data continues to be supportive. So I would say there is absolutely no change in our level of conviction around what batoclimab or anti-FcRn antibodies can do and I think the main thing behind these changes, especially on the CIDP side is actually increased conviction in what we think 1402 is going to be able to do, including increased conviction based on the regulatory interactions that we're going to be able to move really quickly with that development plan. And so a desire to get the most possible information out of the bato study in order to inform that plan as it falls into place. And notably, this won't create any delays with the 1402 CIDP study because that would have begun sort of by the end of this fiscal year effectively anyway. Look, I think, the short answer to the CIDP question you're asking is, I think, we believe we are successfully enrolling quite severe patients. These studies are complex and it's hard to know exactly and we don't have exact data, but we continue to see some discontinuations. This has been observed in the Argenx program as well. This is an early learning of theirs. Frequently, in patients who either have not yet been dosed with batoclimab or who've only had minimal early dosing of batoclimab. So nothing to do with batoclimab, but these are exactly the patients who are severe and active and you want in the study. And so we want to make sure we have enough of these patients and enough data from these patients. Frankly, specifically to understand the dose response that we'll generate in period 1, so as to inform a proper design for 1402 where we can get a maximum efficacy benefit from that program. So that's what I'd say on batoclimab overall. I think the sort of small delay, to the extent there is one in MG is really just a function of why getting a little bit closer to full enrollment on that study and understanding exactly when the patients are coming in. I don't think there's anything particularly material in that timing shift. And we haven't finished enrollment yet. So in theory is possible, that can still be on time. We just got to see what that looks like. On the VantAI point, yes, look, it's a great question. It's not something we talk a lot about these days. Certainly, the reason that we continue to invest time and energy in VantAI and the other drug discovery events that we've built is because we see pipeline optionality for ourselves and value and continue to invest in these technologies. And frankly, we think the sort of predictive generative modeling of protein-protein interactions, something we've been working on for years. It's starting to get more billing now because it's something that has been able to do to some degree. And we think it's going to be incredibly important, obviously, for things like where we've historically spent time and effort header by functional in particular molecular glues for protein degradation. But also for lots of other systems that involve protein-protein interaction. So I think the short answer to your question is while it's currently largely externally funded through partnership and other things. Absolutely, we constantly reevaluate opportunities to develop and advance programs for our own pipeline using those technologies.

David Risinger, Analyst

Great. Thank you very much.

Operator, Operator

Thank you. Our next question comes from the line of Louise Chen with Cantor. Your line is now open.

Louise Chen, Analyst

Hi. Congratulations on the progress this quarter and thanks for taking my questions here. So I wanted to ask you how you think about the peak sales for atopic dermatitis and the pace of the uptake of that potential approval later this year? And then do you have any updates on your capital allocation strategy? I know in the past, you kind of broke out what you thought about share repurchase, M&A, internal investment. Any thoughts there? Thank you.

Matt Gline, CEO

Yes. Thanks, Louise. Those are both great questions. Thank you for listening this morning. On AD, I'd say, look, I think we are excited about the AD opportunity. We continue to reiterate, we feel like it has true blockbuster potential. AD is a big market. It is qualitatively different in size and dynamics from psoriasis. And we think VTAMA has phenomenal data that stacks up even better competitively than our data in psoriasis. So unquestionably, we think AD has the potential to be a blockbuster market. We think it has the potential to ramp faster than psoriasis has ramped. That's true for a number of reasons. It's true because the market dynamics that the market is growing because of more scripts. It's true because many of the docs now have familiarity with VTAMA from the psoriasis side. It's true because there are other novel topicals that have conditioned docs to write things other than steroids. And so for a variety of reasons, we are really excited about the AD market dynamics and think we have a potential for a reasonably rapid blockbuster potential drug. So enough said on AD. On the capital allocation strategy point, I think, we've obviously made significant progress here with our share repurchase authorization and we expect to continue to use that authorization to be opportunistic and focused in returning capital. I'd say overall, the broad buckets that we had laid out before remain unchanged. So about $2 billion of the original total for our existing pipeline. A lot of that focused on Immunovant as of now. About $2 billion, these are really round rough numbers focused on mostly clinical development related to newly in-licensed programs and we see some great things on a racket and then the remainder subject sort of narrowing those error bars down available for return or share repurchase, et cetera, in the coming months and years. Thanks, Luis, those are both really good questions.

Operator, Operator

Thank you. Our next question comes from the line of Allison Bratzel with Piper Sandler. Your line is now open.

Allison Bratzel, Analyst

Good morning. Thank you for the update today and for addressing the questions. First, regarding the Immunovant strategic update and the focus on batoclimab 1402, can you elaborate on the reasoning behind this shift? Was it influenced by changes in the competitive landscape, the FDA meeting, or other factors? Why is this decision being made now? Additionally, could you outline any scenarios in which batoclimab might be submitted for approval in any indications? Separately, concerning brepocitinib, we understand your enthusiasm for the market potential in NIU and BIM, among other indications. What gives you confidence that the current ownership structure of Priovant is the best approach? Are there any situations where you would consider re-evaluating that partnership with Pfizer? Thank you.

Matt Gline, CEO

Thank you, Allison. Those are both excellent questions, and I appreciate them. Regarding Immunovant, I want to emphasize that none of these updates indicate any loss of confidence or change in our belief in batoclimab, which we consider to be an excellent drug. We currently lack the data in CIDP or MG, so I can't predict what the outcomes will be. However, we see this as a compelling opportunity. To clarify, we have complete flexibility to launch it in any of these indications if the data supports that. As always, our decisions will be driven by the data at the appropriate time. The update about 1402, which some may feel has been long overdue, is due to a variety of factors. For one, we've seen promising data in Graves' disease, which has heightened our enthusiasm for 1402. While we have always been optimistic, it's different when you see results in patients, as you cannot fully ascertain the potential until then. Additionally, our interaction with the FDA during the Type B meeting was crucial. It allowed us to address several issues surrounding the pace of 1402's development and helped us feel confident that we can proceed quickly. This is a significant milestone and it shapes our outlook on the franchise, giving us a clearer understanding of how swiftly we can develop 1402. Those are the primary considerations. However, I want to reiterate that our decision regarding batoclimab in these various indications will be data-driven. The data in MG concerning dose response will be informative not only for batoclimab's potential profile as an MG treatment but also for our understanding of 1402. We have increasing confidence that 1402 could become a leading antibody in a rapidly evolving field. Thank you, Allison. Regarding brepocitinib, we are very excited about our progress. Pfizer is an excellent partner, and we maintain regular communication with them. If we can continue to advance brepocitinib as a 75-25 partnership with Pfizer, we view that positively. However, we are open to exploring various options from our end and would be pleased to take a larger stake in brepocitinib, just as we would in several other programs, given our strong conviction in the data. Thank you.

Operator, Operator

Thank you. Our next question comes from the line of Corinne Johnson with Goldman Sachs. Your line is now open.

Corinne Johnson, Analyst

Thanks and good morning guys. Maybe a question on the path to profitability comment, I think, for the press release. I guess what are the assumptions that factor into that comment? And is this reliant on VTAMA sales, sales other products, which ones? And then how do you think about that comment when you're contemplating potential deals, would you sort of forgo path to profitability in order to acquire something interesting or is that a priority over BD. Thanks.

Matt Gline, CEO

Yes. Thanks, Corinne. That's a great question. Look, I guess, I'd say a few things. One is how is the predicting profitability for a business like ours is a challenging exercise. That said, a little bit of everything goes into the forecast in the sense that there's sort of probability-weighted estimates for a variety of our programs and some of them like VTAMA have high probability associated with clinical success and some variability in the commercial forecast. Although, again, we have a lot of enthusiasm for VTAMA and AD. Some of them have lower probabilities of success, but all of them are sort of in there to some degree. I guess the second thing I'd say is I would feel pretty embarrassed if I couldn't sit here today and say that with $5.5 billion, we could be profitable or that with $5.5 billion, we can do BD and also be profitable. So I think I believe both of those things, I believe them comfortably. That having been said, we are going to make ruthless economic decisions about everything in our portfolio and around new opportunities. And I think, I guess, it is imaginable that a program could come along that would change that picture. I don't foresee such a thing. But if it did, you'd have to believe it would be a really good program and worth investing that kind of capital in. So I don't think it's like sacrosanct, but I also feel like we have enough capital on our balance sheet right now to ensure we can do everything we need to do. Thanks, Corinne.

Corinne Johnson, Analyst

Yes. On the deal front, I guess, we had expected maybe some deals earlier this year. Maybe you could talk a little bit about what you're seeing in terms of those conversations and the difference between kind of sourcing ideas versus executing on a final deal?

Matt Gline, CEO

I believe the answer is that we are currently experiencing one of the best deal environments we have ever seen. This is due to various factors, including significant shifts within big pharma and the rapid advancements in biology and B cell immunology. We are identifying promising opportunities in areas such as immunology, cardiometabolic disease, pulmonology, and rare diseases, among others. We are engaged in discussions that range from economic negotiations to generating new ideas. I anticipate that we will see several positive outcomes from these discussions in the coming months. Overall, we feel fortunate to be in this position, and we are working diligently to take advantage of it while ensuring we focus on programs that we are enthusiastic about for the long term.

Operator, Operator

Thank you. Our next question comes from the line of Brian Cheng with JPMorgan. Your line is now open.

Brian Cheng, Analyst

Hi, Matt. Thanks for taking our question this morning. Just first, on the back of your FDA meeting, can you give us a sense of how the rollout of your plan of four to five potentially pivotal programs will look like over the next 10 years? And what was the key take from the Type B meeting with the FDA? Was the Type B meeting for all four to five programs? And I have a quick follow-up. Thank you.

Matt Gline, CEO

Yes, thanks. Maybe I'll hand it over to Frank. I'll just say, we haven't commented which division of FDA we met with on the Type B meeting, but we can hear the correct. But, Frank, do you want to take this one?

Frank Torti, Speaker

Brian I just want to make sure. I think what you said was comment over the rollout over the next 10 years, did you mean over the next 10 years or?

Brian Cheng, Analyst

Sorry, the next 10 months, the next 10 months because you'll be teeing up the prototype programs by March, sorry.

Frank Torti, Speaker

Sure. I think you can expect that they will be introduced in the later part of the year. We have been making reasonable progress on them in parallel, so there will be some operational sequencing as they are rolled out. We are prioritizing areas where we believe we need to establish a presence and where we can implement innovative solutions. We look forward to providing more specific details about these initiatives later in the year.

Brian Cheng, Analyst

Great. And then a quick follow-up is on Biohaven's update on the SAD data yesterday. Just curious about your view and your stance on their data. Thanks for taking our question.

Matt Gline, CEO

Thanks, Brian. Look, I think this is important biology. There's patients that are in need. Our general hope is to root for our competitors' successes because the rising tide lifts all boats. It's obviously that investors were disappointed with the Biohaven update yesterday. I don't think that's a controversial comment. Look, I think the main thing competitor data generally over the past few months has underscored for me is that FcRn as a target has gracefully cleared a fairly high bar and I think it cleared it so gracefully that lots of people and other mechanisms assumed the bar was lower. We didn't totally know where it was because the bar doesn't reveal itself when you clear it. But I think what we're now seeing is it's challenging that this biology is challenging, they're predicting the translation of this biology from animal models, to humans is challenging. And there's just a lot of work to do. So, look, I think that the main thing that competitor data updates have shown us in the past few months is that it's hard to kind of kick in here. And FcRn is really the only mechanism that is clinically validated in many patients, across many indications to be able to deliver in this category of biology. And I am sure there will be others to be clear. This is not like FcRn is not the only mechanism that will succeed. But I'm also sure that it will take time and effort as it did with FcRn for that to materialize. So maybe that's what I can say on the competitor data.

Brian Cheng, Analyst

Great. Thank you, Matt.

Operator, Operator

Thank you. Our next question comes from the line of Yaron Werber with TD Cowen. Your line is now open.

Yaron Werber, Analyst

Great. Thank you. So maybe I have a couple of questions. The first one just on Graves' disease. Can you give us a sense of how much data are we going to see in the fall? Is it going to be the full data? Is it going to be at a medical presentation? And then secondly from that study, do you have enough, will you have enough sense in the dose response to really be able to design a pivotal Phase 3? And maybe just on namilumab, I know this is a drug you really have not talked much about you kind of positioning as an upside potential so to speak. Without a lot of downside to the stock. But how strong do you feel about this mechanism sort of anti-GM-CSF for sarcoidosis? Thank you.

Matt Gline, CEO

Yes. Thanks, Yaron. On the first one and Frank I'll ask if you have feedback here too. I think the short answer is we're going to share a fairly comprehensive data set this fall that will reveal, I'd say, like our performance and something about our dose response and the performance of various arms across different measures for these patients. And this design, which I think you know was patients were started on a dose and then move to a lower dose after a certain number of weeks of therapy was specifically designed to allow us to see a dose response, test the lower better hypothesis and just answer questions about the pathophysiology of Graves' patients. I believe this study design is sufficient for us to move and design a pivotal from here, a pivotal program from here. Frank, anything you would add to that?

Frank Torti, Speaker

No, I think it's well said.

Matt Gline, CEO

Great. And then on namilumab. Look, this is different than studying FcRn even in a novel indication and the FcRn is validated biology. We understand exactly how it works. And these diseases are relatively straightforward in many cases cause it linked to auto antibodies. Obviously sarcoid is a complicated multifactorial disease. That said macrophages plainly play a role in the formation of granulomas in sarcoid and GM-CSF has biological relevance to that. Probably the success is still comparatively low just given the biology and the nature of the disease. But if it does work, it's a huge commercial opportunity. And so I think we feel pretty good about it. Thanks, Yaron.

Operator, Operator

Thank you. Our next question comes from the line of Yatin Suneja with Guggenheim. Your line is now open.

Yatin Suneja, Analyst

Hey, guys. Thank you for taking my question. Question on the Immunovant. So there are indications like myasthenia gravis and TED, where you have a pivotal program ongoing with 1401. Could you talk about what are the key metrics for you to decide if the data are positive that you will file a BLA or you will advance 1402? Or could you do both of them help us understand? Because I think the one question that we generally get from investors is that, look, you have two assets. On one hand, you're saying you're going to really advance 1402 across all indications, but you do have to deal with these two pivotal studies ongoing and then there are certain investors that care about being on the market for us. So help us understand how those decisions will be made? Is there a potential that you will file a BLA for gMG and TED, if the data are positive, and then how should we think about 1402 for those at least two indications? Thank you.

Matt Gline, CEO

Yes. Thank you. Thanks for the questions. They're good questions, obviously, relevant. Look, I think the short answer is, we are going to make ruthless data-driven decisions around whether or not to file batoclimab in any of these indications. These studies continue to be designed as potentially registrational studies. There is no change in any of that. And if the data are supportive of an attractive commercial profile, we will launch the program. I don't think that fact would stop us from parallel prosecuting registrational development of 1402 given the profile of 1402. So I think to answer your question, both is definitely possible. And I think what we're trying to do here is in indications where we can catch up, we'd obviously rather be out with 1402 with its profile, given where we are. And so we're also just trying to set ourselves up for the maximum likelihood of being able to get to, frankly, get to first store in the front pack everywhere that we can. And in places like MG and CIDP, where Argenx is plainly ahead of us. We're going to evaluate our positioning based on the data we see and make what we think will be a smart decision at the time. Thanks.

Operator, Operator

Thank you. Our next question comes from the line of Douglas Tsao with H.C. Wainwright. Your line is now open.

Douglas Tsao, Analyst

Hi. Good morning and thanks for taking the questions. Maybe, Matt, just on brepocitinib. Just curious, when you think about the differentiation we saw in your study and you look ahead to Phase 3. I'm just curious, do you have a thought in terms of where you want to lean into in terms of that differentiation. Obviously you used a shorter steroid tapering period in your study. I'm just curious, would you want to replicate that or would you perhaps just sort of go with the same steroid tapering that they use in the HUMIRA studies in which would potentially or should in theory give you even better treatment failure rates? Thank you.

Matt Gline, CEO

Yes. Thanks, Doug. It's a great question. Obviously happy to talk about NIU because we're really excited about it. Look, I think given how well the study works, and given that a steeper steroid taper ought to continue to provide good separation or perhaps better separation from placebo when we add one into a study. I think given how well it works here, I suspect we will be in time to continue to go. Differentiation beyond that, not the study time perspective, but overall was obviously a big advantage for brepocitinib and NIU, although it pales in comparison to the potential treatment efficacy benefit and look I think what we're looking for at this point is parsimony. We're looking for a fast efficient study that will in an ideal world, replicate if we can just replicate what we saw in Phase 2 or even come close to replicating what we saw in Phase 2, I think, basically everything else in NIU is going to sort itself out.

Douglas Tsao, Analyst

Okay, great. That's really helpful.

Matt Gline, CEO

Thank you, Doug.

Operator, Operator

Thank you. Our next question comes from the line of Andy Chen with Wolfe Research. Your line is now open.

Andy Chen, Analyst

Good morning. Thank you for the question. Matt, I'd like to ask about the potential options with batoclimab. You have four indications under consideration. Hypothetically, if we had the data on MG and CIDP, where batoclimab shows efficacy that is equal to or slightly better than the competition, could you rank the four indications? Which ones generate more excitement for you and which ones are less favorable? I understand that not all indications are the same; some face more competition while safety may be more critical in others. It would be helpful if you could discuss where each indication stands regarding batoclimab. Additionally, about VTAMA, I see the NBRx data presented. Could you comment on how resilient this psoriasis business is? What percentage do you lose over time to competitors and biologics? Thank you.

Matt Gline, CEO

Thanks, Andy. I am tempting to throw this question to Frank because it's a fun curveball. But I think can I rank order the indications? Probably not. I probably can't rank order the indications, especially because setting everything else aside, I think the ordering and the commercial plans will depend on the data that we generate in the studies, all of which are designed to be interesting. Obviously, these indications have different price points. Obviously, they have different competitive environments. Those are obviously factors. But if our data and energy is extraordinary and handily beats the competitors, I think that's a pretty interesting picture. So there's lots of different optionality here. And I think the reason I call it optionality is precisely because we're going to have to wait and see on the specific profile. So maybe that's what I'll say about that. On VTAMA, look, I think there is a group of docs that write this product that have been writing it since the beginning of launch that are excited about the products that write a lot of it that represents a pretty significant bulk of the prescriptions when released. And if you call them ask about the product, say they love the product. And so in that sense, I think it's sticky. Dermatology is promotionally sensitive. We still have to get out there and be out there. There's obviously competitors who are also talking about their product, the landscape shifts constantly. But in general, I'd say the docs who love the product, keep writing the product. And one of our biggest opportunities is to increase that set of docs and get more docs excited about it and using it in daily practice. That's been hard because many of these docs have a real steroid habit. But breaking that habit and getting into writing VTAMA instead represents a big opportunity even in psoriasis. And obviously, the AD dynamics are exciting to contemplate.

Andy Chen, Analyst

Thank you, Matt.

Operator, Operator

Thank you. Our next question comes from the line of Dennis Ding with Jefferies. Your line is now open.

Unidentified Analyst, Analyst

Hi. Good morning. This is Anthea on for Dennis. Two questions from us. In terms of BD with the $14 million upfront deal done last year, what's the gating factor for disclosing this? And could you just comment on details from this program? And then on sarcoidosis, could you talk about what you're measuring in the Phase 2? What's a positive result? And if you will have to do another study? Thank you.

Matt Gline, CEO

Thanks. Appreciate the question. Mayukh, do you want to take the question on BD and the new program?

Mayukh Sukhatme, Speaker

Sure. Yes. I mean the – really the only reason we haven't talked about it yet is purely as a competitive strategic consideration. That's all I had, Matt.

Matt Gline, CEO

We've said historically, there's a big pharma company with another program in the same mechanism as a different indication. And basically, we're waiting to get our own study up and running. It will be announced later in this calendar year. On sarcoid, I think we haven't given a lot of guidance on exactly what we're looking for there. I do think it's a relatively straightforward. We'll know when we see it situation. The competitive bar is low. There are not a lot of other programs. The primary endpoint of the study is effectively a proportion of subjects requiring rescue for worsening of disease. But we're also looking at FDC. We're also looking at time to rescue. We're also measuring various sort of steroid tapers or the ability to achieve steroid taper. I think all of these are relevant to the treatment of these patients. So more to say once we have the actual data, but extended the possibility of delivering new treatment option for these patients.

Operator, Operator

Thank you. I would now like to turn the conference call back over to Matt Gline for closing remarks.

Matt Gline, CEO

Great. Well, thank you, everybody, again for listening today. Thank you to obviously the entire Roivant team who put together these results and who made everything happen in the course of the last 12 months. Thank you to our investors and supporters. Thank you perhaps most of all or at least in a significant way to the patients and investigators, which will make our trials happen and who allow us to continue to generate this data. We are tremendously excited about where we are in the business. I've never been more excited about our FcRn franchise than I am today and many other aspects of our pipeline as well. And I look forward to catching up again soon on scheduled or unscheduled future conference calls. Have a great day. Thank you.

Operator, Operator

This concludes today's conference call. Thank you for your participation. You may now disconnect.