Vertex Pharmaceuticals Inc (VRTX) September 2026 Conference Transcript

Awesome. Last session of the day. Thank you very much for all for joining us today. My name is Mohit Bansal. I'm one of the biotech and pharma at Wells Fargo, and I have the Vertex IR team with us, Suzy Lisa, Hedayar, and Manisha Pai. She's part of the IR team as well, so thank you very much both of us, both of you, to join us.

Thanks for having us, Mohit.

I don't have, oh, ED Investor Relations. Sorry, I did not have the title. Totally fine. Thank you. so exciting times at vertex there's a lot more to talk about not just CF at this point so so talk a little bit about what you are where investors are asking most of the questions and where you are spending most time in terms of talking about the vertex story at this point sure so I think it is an exciting time and we have sort of a catalyst rich period coming up so I'd say most of the conversations relate around that.

I will say, you know, recent news last month, we had been getting a lot of CF questions heading into competitor data that I think, you know, ended up being not as much of a concern as many have thought. And so CF questions have gone back more towards commercial aspects, the Lyftrek switch, which continues to go very well. And then our next and 3.0 family of therapies that are in the pipeline. But the majority of questions, I think, focus on upcoming catalysts, and that's primarily within our new disease area pillar of renal therapies, namely disease-modifying therapies that are addressing unmet need in the renal area where, you know, historically they've had basically repurposed cardiovascular medicine. So really, we're calling it a renal renaissance and a very exciting time. The most near-term catalyst would be on our anaxiplan therapy, which is for APOL-1-mediated kidney disease. And that's where you said that you should expect, you know, in the next couple of months, our phase two proof-of-concept study for a patient population expansion study called Amplified, which is looking at patients with two APOL-1 alleles and then two cohorts, one that has more modest level of proteinuria, and the other cohort has the 2-APL1 alleles and type 2 diabetes. So you'll get that proof-of-concept data sometime in the coming months. The next catalyst that's super exciting will be our November 30th PDUFA date for povitacicept in IGAN. So this will be our first commercial launch in the renal area. We're very excited for that. We are launch ready. Our sales force is hired. We have very high degrees of nephrology experience in that sales force, given the depth of the pipeline, the clinical differentiation of POVI, the safety profile, and the patient administration benefits. So we're very excited for that. And then the next, you get a couple other data sets before the end of the year, likely one in myotonic dystrophy type 1, which is certainly timely right now. We can go into more detail there. In our CF therapies, VX828 is the first of the NextGen 3.0. You could see data before the end of the year. And then we'll complete enrollment in our two Phase III diabetic peripheral neuropathy studies, and that's in the chronic pain space. We'll complete enrollment before the end of the year. Those are 12-week studies that would put us on pace for data sometime in the first half of 2027, likely. And then, very importantly, is you'll get the phase three interim analysis in the first quarter of 2027 on Anaxapylin in the sort of primary or pivotal study there of primary AMKD, which is patients with two APL1 alleles and heavy proteinuric burden. And so we're very excited for that. It's been a long time coming and likely would be our second launch commercially in the renal space. Awesome. And sorry, I would just add to you, Crenetics just closed last week. Right. And so more to come there in terms of updating guidance, but continue to be encouraged by the Palsanify launch in the US and hoping to be able to accelerate launches outside the US and then look forward to Melnat in CAH and completing enrollment in that phase three study. I think those are most of the key catalysts, but it is a lot going on between now and the first half of next year.

Clearly a lot going on, basically. And we barely mentioned CF here. Awesome. So let's just talk. Why don't we start with the time, like in the chronological order, the catalyst here, right? So in that's the plan, in the end, KD. But let's just talk about the phase two portion of the trial. So there is a population expansion study for diabetic patients. And you have characterized this being a little bit more risky than the broader patient population. So talk about that. And then also I want to touch upon the moderate proteinuria patients. Because so far with this molecule, we have only seen data in FSGS patients. So how much does the moderate proteinuria patient data set de-risk the eventual trial, at least for the proteinuria endpoint?

So maybe to start with that group and then go back to diabetes. I think that the data that you have seen is was the phase two the portion of the phase two three for the pivotal right? And yes, that was an FSGS population But what we think and we have long held this belief is that what is crucial is not the FSGS diagnosis But the confirmation that you have to April one variants right you need the genetic test and FSGS is just a histological confirmation. It's a scarring pattern, but you don't see patients referred for biopsy to confirm that unless they have a very heavy proteineuric burden. So in the phase three study, it's likely you will see a high percentage of FSGS patients, but if you had FSGS, you were welcome. If you didn't, you were welcome as long as you had two APO1 alleles and a high proteineuric burden. So I think in the modest proteinuria group here, we think the important thing is inhibition of APOL1. And we have 98% plus inhibition of that, and that's why we have confidence. We still need to see the data. But in this proof of concept, in that more moderate proteinuria group, it's not FSGS that we're treating. It's the APOL1 inhibition, and hence our view, our optimism for the data. The one difference, obviously, will be you have less dynamic range because you're starting at a lower point. There's less reduction, if you could, on an absolute basis because you aren't starting at 0.7 or 0.8, right? You're starting at something like 0.3 or lower. Now, to your diabetes question, I think there, too, we're excited for that data. But the question here is we know we're inhibiting APOL1. What we don't know is how much of their kidney function is impaired by their type 2 diabetes as opposed to the APOL1. and we're not treating the type two diabetes, right? So that's what we look forward to learning. I think that we are quite pleased with how rigorous we were. It was a real challenge to enroll the interim analysis in the more homogeneous population of the phase three study, amplitude. And now we're looking forward to having, you know, decent 20 plus patient sized cohorts in each of those two arms for the amplified data in the coming months.

Got it. So you think the probability is higher for a good data set in the moderate protein patient, followed by the diabetes patient?

I think you could say there's a clearer through line, if you will, and just more of a question mark on the type 2 diabetes impact upon kidney function.

Got it. And these cohorts are a greeting factor for you to expand the program into those indications.

That's right. We talk about in the Amplitude study, the pivotal study with interim analysis next year, that we view that as about 150,000 patients in the U.S. and Europe, and that if you expand the separate cohorts here from Amplified, it's likely adding about 100,000 additional patients to the target population.

Got it. So one question we get, so moving to the amplitude phase three trial, so these are so similar that I have to say phase two and phase three. So I think the agreement with the FDA was that at one year mark based on protein reduction and where do you stand on EGFR, it could be a potential file label data set at that point. So the question we get a lot is that is one-year time point enough to see good enough improvement on AGFR or like the ranges of outcome could be like you continue the trial or not?

So it is a 48-week endpoint for the interim analysis of the amplitude phase 3 study. And the endpoints there, the accelerated approval endpoint, to be clear, is the change in EGFR from baseline. And then in addition, right, it is the reduction in proteinuria. And I would say that our confidence in this study stems from two things. One is that in the phase two portion of this phase two, three study, we saw at just 13 weeks a 47.6% reduction in proteinuria, and that's pretty dramatic, and it continues to decline from there, and so that sort of proteinuria reduction, I think it's reasonable to assume would be associated with stabilization of EGFR, right, and it's, you have to look at how it's doing versus placebo on top of current standard of care. The second thing is that we know that AMKD patients, the rate of decline of their EGFR is about 50% faster than typical CKD patients. And so they're losing about six or seven per year versus something more like losing four or so, three or four, for typical CKD patients. So that's why we think that at 48 weeks, we are hopeful that we can show this, demonstrate this type of result in addition to strong reduction in UPCR.

Got it. And then how should we think about the disclosure there? So FDA wants to see EGFR data, not in this indication, but I mean, typically in IGAN. They do want to see EGFR data, but you do not necessarily want to disclose it. So, like, should we expect data on both endpoints or just proteinuria when you?

I think that for the amplitude and naxapline study and the interim analysis, that's the endpoint. So we will disclose that 48-week EGFR, and if it's successful, right, then we will continue to enroll the study. Sorry, we're on target to complete enrollment by the end of this year, right? But we will continue to follow patients for the full two-year endpoint in IGAN and I would say that the field may be changing in an AMKD but it's not there yet and it's still clearly this EGFR endpoint in IGAN in contrast as you know the agency has moved to you PCR as a as assert as an endpoint and I think there is still debate ongoing about disclosures of one or two-year EGFR. The U.S. FDA clearly will accept one-year EGFR data. Other global regulators will not, right? There isn't a path to accelerated approval in Europe. And there are more patients in Asia with IGAM than there are in U.S. and Europe combined. So that's some of the work that we're going back to consider in terms of disclosures and timing on POVI and IGAM.

Got it. So for POVI, FDA is allowing one-year EGFR at this point. Got it. That's probably the reason some of your competitors are looking at the early data and then just trying to.

I think some who are more focused solely on the domestic opportunity versus we are thinking about the entire global opportunity. So stay tuned.

Very helpful. So moving to Povee. So ahead of the launch later this year. So, I mean, you are preparing for a broad launch with a large field force here. talk a little bit about like you are probably going to be you are the third one to the market but you have the best offering in terms of overall profile of the product talk a little bit about is there a low hanging fruit or Kirigo guidelines updating to like less is better kind of situation like how should we think about the early adopters and ultimately before you know your profile kind of broadens the scope for you.

Yeah. I think that we've been very happy to see the early launches from competitors and the reactions in the marketplace, right? IGAN patients are typically otherwise very healthy and on the younger side, right? They're 40 in their 40s typically and sort of have been these ticking time bombs. But there are 160,000 patients in the U.S. that are biopsy confirmed in terms of their diagnosis. And even with the strong launches that you've seen, we're still talking very small penetration into those 160,000 or so patients. I think that we are really looking forward to our PDUFA date and launch later this year. Our sales force is in place and ready. I think we're quite pleased to see how many of them have prior nephrology experience given their optimism around the broader renal pipeline that we have I think the messaging clearly will be on the trifecta as you mentioned of better clinical data clean safety profile and then the patient administration characteristics which we think are clearly differentiating in terms of once weekly low volume 0.46 ml sorry once monthly low volume auto injector at home And I think that this will be a market where we will, I think you will see switching and we'll go after switchers and we'll go after de novo patients as well. I think initially as the field, right, is moving so fast and you see fairly recent changes to Cadego guidelines, right, in terms of trying to get patients to that threshold of 0.5 in terms of their proteinuria. I think initially you probably will see physicians targeting higher proteinuric burden patients, but would expect to see that coming down over time and a goal to get more and more patients to those guidelines. And Cadegal also, right, recall instead of previously it was treat serially, ACEs, ARBs, SGLT2s, then disease modifying therapies. Now I think it is more of a move to do things concurrently and recognizing sort of saving nephrons sooner is better. and so looking to get patients on these disease-modifying therapies. And so between share of voice, the clinical profile, clean safety, the patient administration benefits, and then also we think our expertise in CF with patient programs around getting them on drugs, supporting them on drugs, helping them with reimbursed access, et cetera, that's important in a chronic therapy as well, and our expertise in CF will serve us well there too, and that's how we're looking to have winning share.

Very helpful. And we have seen EGFR data for, like, DJ EGFR for Yset, then some EGFR data for Vera as well. So, like, how do you internally think about those EGFR data sets? Like, they look more robust than anything that we have seen in IGAN so far. So, let's say using Yset as a benchmark, I mean, do you, like, So do you have to be in that ballpark? Like, I mean, like, is there a number where it looks inferior or superior to existing therapies, or how do you think about that?

Yeah, I think that there are a couple ways to look at it. On the one hand, right, stabilization, you could say, is stabilization. But we do think that there's potential that, again, sort of back to time is nephrons, if you will, you'd rather save more of them sooner. And if you're on a chronic therapy, could a 42% reduction versus something in the 30% reduction in UPCR, does that compound over 10 years? And we think that it potentially will. We also know that we had best-in-class results from our interim analysis in terms of reductions in GDI-GA1 and resolution of hematuria, as well as in getting the percentage of patients to those Cadego guidelines. So I think all of that is what will help differentiate us, understanding that those are strong. You know, EGFR itself is a proxy for progression to end-stage renal disease and death dialysis and transplant, right? So I think understanding these other endpoints like proteinuria, hematuria, and GDIGA are proxies for EGFR, there's strong understanding by physicians and even payers there. So I don't think we'll necessarily, I think we are well positioned to advocate our case, if you will.

Got it. Completely makes sense. Thank you. The other indication, which doesn't get talked a lot about, is by Senia Gravis here. I mean, Vohr has shown, seen, or Imogen has seen some interesting data in China there. so mechanistically how BAF and APRIL could differentiate versus what is out there FCRNs are the front line and then you have complement inhibitors out there what is the value proposition for BAF-APRIL inhibitor in myasthenia gravis based on your thoughts yeah I think we view myasthenia gravis as if you will sort of the poster child for a B cell mediated disease so being able to inhibit at really two points on the on the on the maturation cycle we think is

very compelling and the data out of China with a wild type we felt where we're you know did support that view of my sceni gravis as being sort of a prime candidate for a B cell inhibitor and we think with a the design the engineering that's gone on to TACI in terms of its tissue distribution and penetration, et cetera, that we would be hopeful that we could show even better results in myasthenia gravis. So we're currently enrolling a phase two study. It's a 12-week study. We haven't given timelines on that, but that's another catalyst to look forward to probably over the next 12 months or so. And sorry, on FCRNs and others, right, I think the key advantage of Bafapril inhibition is that you other therapies right you need to cycle on and cycle off but the auto antibodies continue to develop right so with the bath april inhibitor you wouldn't you could have chronic therapy and you wouldn't need to cycle on cycle off and you could have sustained benefit makes sense uh so the phase two study is actually not that big a study like 30 patients across uh placebo and i I think there are two treatment arms there.

So given the small size here, what exactly are you looking for? Because I think you'll make a go-no-go decision for phase three based on this. So what exactly are you looking for to make that decision here?

Yeah, we haven't given a bogey for that. But we do think, yeah, you had to ask, but we do think that the 12-week data on those 30 patients or so will be sufficient, given what we hope, I guess we could hint at the magnitude of the treatment effect, right, that we hope to see that that's enough time and enough patience in order to be able to make a decision.

Fair to assume you'll be looking at biomarkers as well, more than not just the MGADL and all those things?

I think, yes, that's right, yeah.

All right, okay, got it. Very helpful. Moving to the pain franchise, Jernovex, I mean, so initially it was off to a little bit slower launch, and now it seems like you are gaining traction in the last couple of quarters and with the family placement at hospitals and all that. Talk a little bit about what you are seeing in terms of how P&T committees are actually implementing Genovex and what are the gating factors at this point for Genovex uptake here?

Yeah, I think we've been pleased with the progress in terms of adoption, whether it's by formulary or treatment protocols or care pathways. And there's all different aspects, whether it's inpatient outpatient inventory surgery center etc and you see different levels of adoption at different facilities ranging from let's have a more measured adoption inclusion on our formulary to we've done the work and we're comfortable here let's let's open it up broadly but I think that it's one of the key drivers to the strong prescription growth that we've seen this year where we remain on track to hit our goal of tripling prescriptions in 2026 versus 2025 but it is one of many factors so formulary care pathway treatment protocol adoption along with improvement in reimbursed access and covered lives as well as the doubling of the sales force and our marketing initiatives and celebrity spokespeople like Jason Tatum we're also I think very encouraged to see of late more and more physician-sponsored studies being published. For instance, orthopedic surgeons in particular are publishing their single center series of, say, total knee, and you're seeing really compelling results of 90%-plus type opioid-free results from some of the most painful surgeries out there. So I think that and then presenting it, We are doing more and more in terms of our patient outreach and micro-targeting of it, directed TV advertisements and radio, et cetera. So I think it's the combination of this really sort of all-out approach that is leading to the strong growth in scripts and continued improvement in terms of gross to net. I'm happy to talk about that more if you'd like as well.

Yeah, let's just talk about that. There was also a part where hospital versus retail split is also slightly more tilted towards hospital versus what you would want to see long term. That's why the script length is also shorter. So talk a little bit about that as well, because we are just using the script and multiplying with whatever number is there, but that's probably not true.

Sure. So we very purposely are thinking about this for the long term and therefore went after a broad and it's a very broad label, right? Moderate to severe acute pain. So we went after trying to be as broad as possible in terms of types of prescribers as well as settings of care. And so the market itself for acute pain is about one third in hospital use and two thirds at home or retail. Our mix continues to be a bit more 50-50 because we are focused on those in-hospital prescribers who will then take it to their ancillary clinics, et cetera. So trying to build for the long-term and focus there. And I should have mentioned one of the other key drivers of script growth is this breadth of prescribers, where I think we're north of 36,000 prescribers, and it ranges from ER and trauma docs to orthopods to dentists, obviously, you know, plastics, OB-GYN, anesthesiologists, So pleased with that. But I think that the average hospital script is something more in kind of the two to five day range versus a retail script is something in the 14 day range. But I think the real sort of lag, if you will, between the revenue recognition that we initially hope to see versus what we now expect is is related more towards reimbursed access and some of the delays there. And where our patient support program essentially is still being triggered, if you will, at the point of care in retail prescriptions. So it's like a safety net. It kicks in sort of blinded to both the patient and the pharmacist. If there isn't reimbursed access, we don't want that patient to walk away or call their physician and say, I couldn't get my drug. We're trying to convert entire practices. So the PSP kicks in if you don't have reimbursed access. And what we're finding is sometimes you may have coverage at the parent plan level, and it takes time to implement at the child plan level, or there may be some minutiae or technical aspects of how the script is written for a 14-day quantity limit or a prior auth that is getting in the way sometimes, and the PSP is being triggered when it technically shouldn't be. And we're working through those issues and why we expect we'll keep the PSP in place as we work through them and continue to expect to see more revenue recognition.

Got it. So that is more of a 27 story or is it?

We talked about a more normalized gross to net in sort of mid-2027, probably something plus minus 50% range.

Got it. Makes sense. Talk about the DPN trial as well a little bit here. I mean, you had robust data in phase two. So the drug is active. The question here is placebo responses, because a lot of pain trials have been killed because of the placebo response here. So to that extent, how are you managing that part of the control arm of the trial and site training and all those aspects of things?

Yeah, so thanks for remembering the phase two, right? We had greater than a two-point improvement in NPRS. And so we know there's activity here. And I think sort of the good news of having to narrow our focus, if you will, in peripheral neuropathic pain is by going to DPN is there's a lot more clinical trial experience, both in terms of CROs and sites and our own, and as well as with regulators. So a controlled number of sites, significant training in terms of how to manage placebo effect, and I think a better understanding of how to characterize the pain, how to work with patients, et cetera. So I think we are optimistic and excited to complete enrollment of those two studies by the end of the year, as I mentioned, and then see the data from there. But it is a lot about training and management of placebo effect. And with more experienced sites in this type of pain and a limited number of sites, we hope to be able to address that.

Got it. Very helpful. So last one, last set of questions about the chronetic steel, right? So the one question we get a lot is that, I mean, you talked about $5 billion peak opportunity there versus, you know, at that point, consensus was somewhere around $3 billion for the company there. So in your internal projections, like where do you see the disconnect between like what you projected versus what analysts were projecting for Chronetics at that point?

Yeah, so I can talk to you about how we get to that approximate 5 billion number in peak sales. And there are multiple ways to get there. So first with Palsonify, which is approved for acromegaly, we see that as a blockbuster opportunity. The launch is off to a great start. And, you know, our goal is to accelerate it, to expand outside of the U.S. And then at Gmelnant in congenital adrenal hyperplasia, we see that as the larger opportunity, as a multibillion-dollar opportunity.

So between those two, you could get to $5 billion. and at you Mellon is also being studied in Cushing's disease which could provide additional upside on top of that so that's how we think about it and five billion doesn't include the early stage assets at all at this point that's right right okay got it that's all upside awesome so and then you will disclose the financial impact once you close like now you have closed the deals the next quarter you should expect the updated that's right very helpful so last question for both of you. Wells Fargo Healthcare Conference 2027. I hope you are here, I hope I'm here. So we are sitting here next year same time, by the dates are same, 8 to 10 September.

So what would make you look back at the year and say it was a great year for us I think that it'll be we look forward to saying we have a diversified commercial revenue picture with established disease area pillars across five areas right CF hematology acute pain or pain broadly speaking the specialty rare endocrinology with the chronetics acquisition, and then in renal. And potentially September 27, you know, getting close to a second launch potentially in renal at that point in time. And, you know, hopefully sitting on top of good DPN data in pain, a strong POVED launch at that point in time, continued strength in the CF outlook, continued progress in Casgevy in terms of number of patients and their essentially functional cure and the amazing outcomes there, and then continue to push the earlier pipeline, right, whether that's in DM1 or in ADPKD or in other areas. But I think it's those five established pillars, three of which are commercialized today. And with the Krenetics closing, we've got the fourth, but expanding that and then bringing along we didn't even mention type 1 diabetes right but then also I think hopefully getting close to a second for a successful first launch in renal and getting close to a second potentially.

Anything to add?

That was pretty comprehensive I'm not sure I have anything of value to add on top.

Thank you very much on that high note really appreciate you coming here and all the best.

Okay thank you Mohit. Thank you very much.