BioMarin Pharmaceutical Inc Q3 2024 Earnings Call Summary

The following is excerpted from the question-and-answer section of the transcript.

Question: Philip Nadeau - TD Cowen - Analyst : Just two for us, one on Voxzogo and one on. On Voxzogo, you noted that patient starts were primarily among the patients under the age of five here in the US. What does that say about the maturity of the launch in the US? Are we approaching a period where new patients start to largely be an incident population? Or is there still a lot of the prevalent population out there that's untreated in the US and could go on therapy? The second, on business development, James, welcome. Congrats on the new position and great article and BioSentry over the weekend. Curious, based on the presentation, you noted you want to target deals less than $1.5 billion. What phase of development would be ideal for BioMarin at this stage in the pipeline's maturity?

Question: Salveen Richter - Goldman Sachs Financial, Inc. - Analyst : Could you just walk through the development strategy here for BMN 333 and how quickly you can move into other indications beyond achondroplasia with the long-acting CNP? And then separately, with regard to your IP strategy here in the context of Ascendis and the long-acting CNP, just help us understand where you stand on your IP and just the strategy on the forward here with regard to your franchise? REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. OCTOBER 29, 2024 / 8:30PM, BMRN.OQ - Q3 2024 BioMarin Pharmaceutical Inc Earnings Call C. Greg Guyer - Biomarin Pharmaceutical Inc - Executive Vice President - Global Manufacturing and Technical Operations, Chief Technical Officer Thanks, Salveen. This is Greg Guyer. I'll take the first question. With regard to BMN 333, of course, we're quite excited to be able to bring that at patients, and we should be entering the clinic early next year. The strategy behind the molecule, of course, is to elongate the half life, and we're confident that the linker technology and the binding technology, again, are tried and true, and we'll be able to do that. What that can afford, of course, is one of two things. The less exciting would be less frequent administration. But the more exciting aspect is the one I just want to focus on for a moment, which is if you can change the PK profile of this near native CNP and you can increase the delivery of that hormone into the body in a safe way, then we could think about actually increasing not only the pharmacokinetic exposure to CNP but also the pharmacodynamic effect in our preclinical models would suggest that there is more to be gained there with regard to activity and bone lengthening. And the first set of data is going to give us a lot of important clues as to whether or not the PK profile is playing out the way that we had anticipated. That's data that we should have in-house next year. The healthy volunteer study is going to give us a good read on that PK profile. Depending upon the results there, we could go in a variety of directions. We do believe, as you point out nicely that this is a pathway that should be able to address genetic skeletal disorders beyond simply achondroplasia and hypochondroplasia, and the teams are working very diligently to come up with scenarios if that profile plays out the way that we believe it may to accelerate that approval. More to come there. But I think you've highlighted very nicely that there are opportunities here to accelerate the program, and we'll be looking for those actively.

Question: Jessica Fye - JPMorgan Chase & Co. - Analyst : First, on the P&L, COGS looks elevated this quarter. The press release makes mention of the impact of Roctavian inventory reserves. How big was that? And would gross margin have been in line with more recent quarters without that effect? And then maybe following up on Salveen's question for 333. I think you've talked about single ascending dose data in 2025. Is it possible we could get a full dose data next year as well? Or if not, should we think of that in 2016?

Question: Jessica Fye - JPMorgan Chase & Co. - Analyst : This is one or the other?

Question: Paul Matteis - Stifel Nicolaus & Co., Inc. - Analyst : Great. As it relates to your reiteration of guidance, I think the inference that many analysts and investors have made that if you're willing to or I guess, confident in reiterating your guidance in the face of made some surprising increased competition in achondroplasia. You must have thought originally that your guidance issued at the Investor Day was fairly conservative. Is that the right inference? And if so, on what points did you feel like your initial guidance was conservative? Around what points do you feel like the Street is missing the big picture on your long-term vision around the size of these markets and your penetration?

Question: Eli Merle - UBS Group AG - Analyst : Can you give us a bit more color on what's driving the increase in the ERT business growth? And I guess your confidence that this can continue to grow in the high single digits for years to come. I think you mentioned some initiatives you're working on, if you can maybe elaborate a bit more on what those entail?

Question: Cory Kasimov - Evercore ISI - Analyst : Just two for me as well. So for Voxzogo, can you comment as to how many patients from your original Phase 3 trial have now reached their full adult height? And then just a clarification on the DMD program. You noted that you're going to have the data in-house in Q2. Is that going to be publicly shared at that time as well? I just wasn't sure when you said it was going to be internal. C. Greg Guyer - Biomarin Pharmaceutical Inc - Executive Vice President - Global Manufacturing and Technical Operations, Chief Technical Officer Thanks, Cory. This is Greg. For the first question, we are tracking those patients from the Phase 3 program very vigorously. We're not going to release numbers with regard to how many patients have reached final adult height. Clearly, that is an endpoint that regulators are very interested in, and that is part of our commitment for post-marketing requirements to provide that data at a reasonable time. Part of the challenge, of course, is that these patients reach that final adult height in different timing based on what age they were when they entered the study. But suffice to say, we're, of course, following that very closely and continue to make progress year-to-year. With regard to the Duchenne Muscular Dystrophy program, yes, we're very excited that we will have muscle dystrophin data from the first six patients in-house midyear. We'll be looking at that. And just to take a step back for those who aren't quite as familiar, this is a molecule that's engineered to increase dystrophin levels in the muscle to levels that are dramatically higher than what we've seen with other molecules in the space. And there's a variety of engineering levers that were pulled to try to accomplish that. But the most important of which is addressing a novel binding domain in the nucleic acid that at least the preclinical models results in 30%, 40%, 50% dystrophin levels in the rodent models at a much higher rate than what we've seen with other molecules that we both synthesized and those that are available. So that data from the first cohort is going to give us a line of sight on whether or not we can hit our target. Our target is a 10% level or higher at steady state in the muscle of these boys who are on the study. Now it's important to remember that steady state actually is not at 25 weeks. It may be later than that. But we've done some modeling, and I think with our 13-week data and our 26-week biopsies, we'll have a good read by midyear where we're headed. Depending on what that data is, it may be worthy of release, it may be giving us information that also tells us that we need to adjust the dose but we will certainly be revealing that data when we feel that it's of a sufficient quality and volume that it would be meaningful to release. Beyond that, not much more to add at this point.

Question: Kostas Biliouris - BMO Capital Markets - Analyst : Hello, everyone. Congrats on the quarter. Two quick from us, one on Voxzogo and one on Palynziq. On Voxzogo follow-up from a question before. Can you remind us what is the status of the transition to full approval from accelerated approval and what this may mean for the regulatory pathway of competitors that are behind you in development? And the second question on Palynziq is any thoughts around competitive positioning given that some oral agents may enter the market in 2025? C. Greg Guyer - Biomarin Pharmaceutical Inc - Executive Vice President - Global Manufacturing and Technical Operations, Chief Technical Officer Thank you Kostas, this is Greg again. Why don't I take a stab at those two. With respect to Voxzogo, we are committed to measuring final adult height on our patients who were on our clinical study, our pivotal study, and we have that agreement with regulatory authorities. Beyond saying that we're vigorously collecting that data and looking forward to reaching the critical mass that the regulators are interested in. I don't have much else to add. Of course, regulators with regard to full and accelerated approval, they always have their ability to use their judgment to decide when new agents come along. So we're very much focused on our own agent and being able to convert that to full approval for the good of, of course, the patients who are treated with. With regard to Palynziq, the PKU space is one that BioMarin has a fortunate position to be able to serve these patients for almost 20 years now. And in that time, we've learned quite a bit about the space, about the patients, about the treating physicians and about what the needs of this group are. The big picture here is that these are a very heterogeneous group of patients. They have different ages. They have different needs. We know from the clinical studies that they respond differently to the therapies that are available. And because of that, we see the addition of new agents to this field actually is being good for patients. It will give physicians more arrows in their quiver. Not every patient has created equal a Palynziq patient, for example. These are patients in our pivotal study that had fee levels that were over 1,000, for example. And this is a molecule that if you look at the treatment guidelines that are out there, the Palynziq patient, the goal of that patient is to be able to reduce the fee levels as low as possible. And I believe the quote in many of the guidelines is with a normalized diet. That is a very different patient than perhaps the BH4, analogs may be able to address. That being said, it's a good thing for patients that they have multiple different options, and we're anticipating that these are the kind of advances that patient's need. In fact, we're developing a next-generation Palynziq because we believe that we can help build upon that profile as well. So that standpoint, I think the only other objective data that's out there, there was an FDA ruling recently. One of the oral agents that was filed was given a standard review. By definition, they use two criteria when they define that. One is that, is this a serious illness. We believe that PK is a serious illness by their definition. The other criteria they use is did this new applicant meet the criteria for a significant improvement in efficacy and safety compared to available therapies. They obviously chose to give a standard review. So I think from an objective standpoint, that speaks for itself.

Question: Joe Schwartz - Leerink Partners LLC - Analyst : I have a question on 333 and also 390. So at your Investor Day, I think you projected that 333 could come to market in 2030. But since your CNP patent expires in that year, that doesn't seem to give you much time to convert people to your own long-acting before generics arrive and then you'll probably also have a couple of branded competitors by then. So I'm just wondering if you can talk about the practical benefit of 333 is expected to be on the business? And then likewise, you noted there that your next gen Palynziq with a novel PEG could expand the PKU market a lot, but the development path you laid out suggested it would take about 10 years to get it to market. I know PEGPAL took that long, but I'm just wondering why should it take that long for BMN 390. C. Greg Guyer - Biomarin Pharmaceutical Inc - Executive Vice President - Global Manufacturing and Technical Operations, Chief Technical Officer Thanks, Joe. I'm going to hand it off to Alexander first.

Question: Akash Tewari - Jefferies Financial Group, Inc. - Analyst : Can you talk about the dynamics between total patient adds and incremental revs for Voxzogo? You had 300 patient adds from Q2 to Q3. You had a modest $7 million increase in revs. I know there was a $20 million stocking benefit. But number one, is 300 patient adds a reasonable assumption going forward for Voxzogo growth in Aecon. REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. OCTOBER 29, 2024 / 8:30PM, BMRN.OQ - Q3 2024 BioMarin Pharmaceutical Inc Earnings Call And then number two, how should we think about reps per patient evolving as you expand into international populations? And then just on Ascendis and IP, how aggressive is your team willing to be here? Should we be thinking about some type of royalty payment? Or is the angle BioMarin going to pursue it's going to be a preliminary injunction, and you're aiming to stop attendance from launching the product altogether. How should we think about how aggressive you'll be on IP?

Question: Chris Raymond - Piper Sandler & Co. - Analyst : Just on the clinical premise behind BMN 333, I hear you guys talk about improved PK and PD with a long-acting CNP that could drive better growth metrics. But I get this question from investors. Maybe walk through the differences between 333 and TransCon CNP? If we haven't seen a discernible growth benefit from that asset, why mechanistically would 333 be different? C. Greg Guyer - Biomarin Pharmaceutical Inc - Executive Vice President - Global Manufacturing and Technical Operations, Chief Technical Officer Thanks, Chris. This is Greg. Let me take a stab at that. First and foremost, we are targeting a free CNP level that is higher than not only what Voxzogo can deliver from a time of a threshold AUC standpoint, but higher than published data for agents external to REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. OCTOBER 29, 2024 / 8:30PM, BMRN.OQ - Q3 2024 BioMarin Pharmaceutical Inc Earnings Call BioMarin as well. So in the preclinical models, that suggests if you can increase that 50%, 100%, that there are discernible changes in AGV in those animal models. Now the premise, of course, assumes that, that can be done safely. Again, our preclinical package suggests that, that is the case. But then that is an experiment that we do need to test in the clinic with those ranging studies in patients. the totality of evidence here is going to be something that absolutely is key. We still believe that Voxzogo is an agent that not only is first-in-class, but has the

Question: Mohit Bansal - Wells Fargo & Co. - Analyst : Two, if I may ask. What is your base case assumption around the length of trial for BMN 333 at this point? Is it a two-year controlled trial or one-year controlled trial? I'm asking because if there's any room to expedite it and then maybe launching before 2030 here. Number two, it does seem like Naglazyme has done really well compared to what we have seen in prior years year-over-year basis. So can you talk a little bit about the strategy and what has helped here? And how should we think about the product going forward? C. Greg Guyer - Biomarin Pharmaceutical Inc - Executive Vice President - Global Manufacturing and Technical Operations, Chief Technical Officer So thanks, Mohit, for the question. For the Phase 3 study, the development plan for BMN 333, of course, there's two variables in play here. Any study, of course, needs to recruit the set of patients and the effect size that we would be targeting would absolutely drive not only the number of patients we need, but the amount of time that we take to recruit those patients. The profile is going to, again, reveal itself incrementally. I think the PK will be the first step. But if we believe that this is a molecule that can deliver much higher CNP exposure in the patients. And if we believe that, that translates into effect sizes, that would indeed change the endpoints that we'd look for in a Phase 3. There are far too many permutations to be able to go into additional details at this point of what the Phase III study might look like or might not look like. But inherent in your question is, can this be accelerated? I believe there are scenarios where if the profile plays out the way that we're anticipating that we will have the chance to try to accelerate those time frames. No promises today, but it's something we're actively looking at. And urgency to get to patients is one of our absolute core values here at BioMarin. REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. OCTOBER 29, 2024 / 8:30PM, BMRN.OQ - Q3 2024 BioMarin Pharmaceutical Inc Earnings Call And we understand that if we have a molecule that's delivering something more valuable than even our own product, we would want to bring that as quickly as we can.

Question: John Wang - Barclays PLC - Analyst : So I would just ask one question regarding the BMN 333. Greg, you did mention that you wanted to have a better efficacy hopefully, with a better exposure. But based on the Voxzogo dose escalation study, there it seems there was a ceiling effect regarding the efficacy. And so we will make you confident that could be with a higher dose or high exposure that can translate to better efficacy. And then related questions, I think, based on the Investor Day that one slide shared with investors we did see like the exposure plus concentration almost in the like two log or three log magnitude improvement compared to, say, Voxzogo or even TransCon CNP. And within that, frequency of dosing? Would that be also a very important component that you were taken into consideration? C. Greg Guyer - Biomarin Pharmaceutical Inc - Executive Vice President - Global Manufacturing and Technical Operations, Chief Technical Officer Thanks, the your questions with regard, why don't I think first Investor Day figure. With a molecule like BMN 333, there are two species, of course, that we need to be talking about when we look at PK. One will be the native molecule. That will include the linker technology, the binding technology and so forth. And I believe that's what was shown in investor, a much higher molecular weight. So again, if you're comparing the units, they will look somewhat differently. From a pull-through, what we, of course, care about is the liberated, and we, of course, from our preclinical data in humans will be measuring very closely. That profile of free CNP and we do believe that we can safely and in a way that has a different shape to the PK curve. So it would rather than be a software tooth pattern of a shorter half-life molecule, would be able to increase AUC, again, increased time above threshold we believe not only can we increase the exposure of CNP there, but do so in a way we could see physiologic differences as compared to Voxzogo in the way that it was given. REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. OCTOBER 29, 2024 / 8:30PM, BMRN.OQ - Q3 2024 BioMarin Pharmaceutical Inc Earnings Call I think of this similar to other peptides where insulin, for example, is one that when given in its native form versus in a variety of constructs, you can see different biologic effects from the shapes of the curve that are more than just described by, say, Cmax or AUC alone. And so we're absolutely excited to test this in patients. We're going into the clinic in the very early next year. And we should have a good read on both the molecule, BMN 333 pharmacokinetics as well as free CNP in rapid order. So that will have that data in-house midyear.