Sandrine: So we are really trying to extend here the overall market for Visgard, and this is very great for CLDP patients. So now for the C5 question, I think Karen wanted to say something, so I'll hand it over back to Karen.
Karen Massey: Thank you, Sandrine. I think that's great, and I think you're exactly on point. As we've seen new competitors coming into the market, C5s and others, they're mostly being used in the refractory space. So thanks for the question.
Operator: Your next question comes from the line of Alex Thompson from Stifel. Your line is open.
Alex Thompson: Hey, great. Thanks for taking our questions. And again, congrats to Karen here. I was wondering sort of to talk at a high level about your appetite for later stage, you know, business development and what you've done historically and maybe in the context of that, you know, how you're thinking about your forte equity investment. Thank you.
Karen Massey: Yeah, thanks for the question. Yeah, maybe to take a step back, we talked about our ambition earlier with Vision 2030 and over the long term, we want to become a leader in immunology. And what that means is that we're focused very much on building our pipeline. In the past, we've been focused on building our pipeline through partnerships with academic institutions. You all know our immunology innovation program and where we've sourced novel biology that can provide transformative outcomes for patients through those partnerships with academic institutions. as we've been developing a stronger cash balance and financial strength, what that allows us to do is broaden our lens a little bit and also look for other opportunities to source novel biology where we can provide transformative outcomes. So your example that you're calling out of Forte is one example of that where we made a strategic investment in something that we see as novel biology and similar to, what you also saw with Tensegrity earlier this year, where we're investing in options in novel biology. So you can expect to see more of this from us as we continue to build our pipeline and continue to leverage our balance sheet. We want to invest in our internal innovation pipeline and source novel biology from wherever we can find it. Thanks for the question.
Operator: Your next question comes the line of Rajan Sharma from Goldman Sachs. Your line is open.
Rajan Sharma: Hi, thanks for taking my question. Maybe just on the topic of competition, we saw that J&J are running a head-to-head trial of Imavi versus Vivgot in Mycenae Gravis, which could read out next year. I was just wondering if you could provide your perspectives on the trial design and expectations here. To what extent is that a risk to Vivgot or not, conscious of the different formulation? And then a very quick follow-up for Carl. I heard your comments on operating leverage. Should we expect to see this incrementally quarter on quarter as well as on an annual basis? Thank you.
Karen Massey: Yeah, thank you. I'll take your question on competition and then I'll hand over to Carl for the question on operating leverage. Yeah, look, I think Sandrine said it best. We put MG on the map and many competitors are following us, especially as the first in class FCRN. And I think what you see is that we've set the standard for efficacy in terms of MSE in MG and have the strongest safety profile. And we have all of these innovations. We started with IV, we launched subcutaneous, and then we most recently brought PFS to market. And in fact, PFS is driving the majority of our growth at the moment. And so when you think about that, I think the question to ask about some of these studies and these other competitors is what problem are they trying to solve? And I think what we're really focused on is how do we bring more value to more patients where there is unmet need? And for us, that's focusing on PFS, which is unmatched, as well as focusing on that strategy we were talking about earlier, which is broadening the population through seronegative, through ocular, and in the future, through pediatrics. So with that being said on competition, maybe, Carl, you can talk about our operating margin.
Carl: Thank you. Thank you, Rajan, for the question. Yeah, I want to start off by reminding we are on an innovation mission. The patient is your North Star. We have a unique opportunity now to invest in innovation and set the company up for the long run, to build a long-term sustainable company. That is the capital allocation priorities of the company. But that said, yes, you are right. A very successful launch allows us to build a P&L where we already have a very good margin structure. Our gross margin is around 90%. Our operating margin is around 30%. We added $400 million of cash this quarter, getting us to $4.9 billion. So, yeah, you can expect going forward to see margin expansion every quarter, year over year, and we're going to continue to build on that. But that, of course, is not the objective at the moment, but I think we can do both. Thank you for the question.
Operator: Your next question comes from Alison Brattle from Piper Sandler. Your line is open.
Ashley (for Alison Brattle): Good morning. This is Ashley on for Alison Brattle. Congrats on the quarter and all the progress. So just for months, just curious to learn more about the go and no-go decision on the phase two VARFA trial and degree in delayed graft function, which is expected mid-year. What specific clinical or biomarker signals are you looking to see to justify advancing clinical development? And just more broadly speaking, how are you viewing the commercial opportunity in delayed graft function? Thank you.
Karen Massey: Hi. Yeah, thanks for the question on DGF. As I said earlier, it's great to hear these questions on our pipeline. So, DGF is an important indication for us for our second molecule, impasse pruvat. And we're able to pursue DGF as an indication because of impasse approve-up being a C2, so involved in both the classic and the lectin pathways in complement. So that's a differentiator for us. In terms of the study, it is a phase two study. So think about it as an exploratory study. And what we wanted to do was see the readout of the data for longer term. So we're following the data out to 52 weeks. Because in this patient population and what we hear from both patients as well as healthcare systems and providers is what they care about is the long-term outcomes. So as soon as we have that data, we'll be able to analyze it and we'll have a go, no-go decision for phase three. Thanks for the question.
Operator: Your next question comes from Daniel Brill from Tourist Securities. Your line is open.
Alex (for Daniel Brill): Hey, guys. This is Alex. I'm for Daniel. Thanks for taking our question, and congrats on the quarter. Another question on myositis, on the placebo response, just curious if you could talk a little bit about what factors are known to drive the placebo response, and do you expect any difference in the three subgroups? And then alternately on the steroid taper, just curious what effects of the steroid tapering you're anticipating in the placebo response, and also do you have any thoughts on why rovent steroid tapering is did not yield any decrease in the overall TIL, TIS endpoint in its placebo arm in its DM trial. Thanks so much.
Karen Massey: Yeah, thanks for the question. So let me take them one by one. So first, when you think about placebo response, whether across immunology, you see this pretty consistently. You know, we've seen it in MG. In CIDP, you see it in Sjogren's studies and similar in myositis. So I think this is a pretty common phenomenon. And when you're developing an immunology like we are, then you start to get sort of good learnings around how to make sure you're minimizing that placebo response in the trial. And that can include things like training the sites to make sure that they understand how best to use the tools and the measures for the primary endpoint and that type of thing. So in this case, as you said, it's TIS. So I don't think there's anything special across the different subtypes or in myositis there. In terms of the steroid taper, we think this is actually a benefit of the design of our study because what we've been able to do is build it in late enough in the trial so that you have a systemic steroid tapering, which should actually unmask any placebo response. and help us to show a clear benefit on active disease. So we see that the way that we've designed it is very elegant, and it should actually help us to uncover the benefit of this gut. In terms of Roivant, I would encourage you to ask them. I'm not sure about the details on their steroid taper. Thanks for the question.
Operator: Your next question comes from Yaron Verber from TD Cohen. Your line is open.
Yaron Verber: Great. Thanks so much and congrats, Karen, again. A couple of sort of interrelated questions. One, can you just give us a little bit of a sense? We're kind of thinking that CIDP is around 40% of sales right now, maybe kind of 37%, I don't know if we're in the right ballpark. And then secondly, for the seronegative study, it was a very wise study with a p-value of 0.1 across all patients which you hit successfully. it looks like he was driven by the musk and lrp positive patients uh in the seronegatives technically the endpoint wasn't met but because just it came together literally at the end there was a benefit throughout the period just trying to get your conviction that you can get a broad approval and not just in the auto antibody positive thank you yeah thanks for the questions um i'm going to hand it over to carl
Karen Massey: uh to to talk about cidp and how uh the the mix of business is evolving and then i'll turn over to sandrine to talk about uh sierra negative i want to just make a point that's really important though um related to the specific question you asked we're three days from our padufa date um and so we have to be very careful uh in how we talk about this so we're going to keep the discussion very general and what i want sandrine to talk about is in general how you see the sierra negative opportunity uh in in the case of approval so that we don't go into those details. But maybe we can talk about CIDP first.
Carl: Jeroen, thank you for the question. Yeah, both CIDP and MG continue to be growth drivers for us. And, of course, CIDP is mainly in the U.S. now, but also in Japan and Germany. Other markets we still have to launch. In terms of a percentage breakdown, I don't want to get into that, but I will say that MG is still the majority of our revenues and, of course, the majority of our profits. of our patients, but both still have a lot of growth in them. Thank you for the question. I'm handing over to Sandrine.
Sandrine: So thank you for the question on seronegative. So like Karen said, I will stay very general because we are only three days away from the PDUFA date. So if approved in seronegative, as you mentioned, I mean, there is a pool of patients which we assessed at 11,000 patients that would cover potentially, you know, these three subtypes. And so as we are only three days away from PEDUFA date, we are obviously ready to launch. I mean, the good news is that we already embedded into MG. There is a big overlap of the prescriber base with more than 80% of the target we already visited that are actually, that we cover seronegative patients. So we don't need to add any field force. The prescribers know extremely well VisGuard and they trust it. They have experience of VisGuard. and its efficacy that is deemed fast and sustained. And then we had a good presentation of AAN with lots of questions, so it showed that there was an interest, really, and that the physician and providers are really waiting for that. So I won't be able to go more into the details, but we should hear in the next few days. Thank you.
Operator: Your next question comes from the line of Thomas Smith of Learing Partners. Your line is open.
Thomas Smith: Hey, guys. Good morning. Thanks for taking our questions. And let me add my congrats to Karen on stepping into the CEO role here. It sounds like the VisGuard auto-injector continues to advance in your guiding to launch in 27. Can you just provide an update on where you are with this formulation? What are the outstanding gating factors for bringing this to market? And how are you thinking about potential uptake in this form versus the pre-filled syringe? And then if I could, just a clinical follow-up on F-gartigimab and Graves' disease. We saw the Phase 3 design that you recently posted on clinicaltrials.gov, and I was wondering if you could comment on some of the design considerations for this multi-part study. How are the patients being handled between Part A and Part B, and how are the background ATDs being managed? And even just higher level, like what are your expectations with respect to the primary endpoint and registrational path? Thank you so much.
Karen Massey: Hi. Yeah, let me start with the auto injector question. We're moving into manufacturing stage at the moment, as you say, to get ready for auto injector launch in 2027. The key ungating factors are really just moving through those different gates of making sure that we're ready for production and approval. In terms of the opportunity that we see with auto-injector, what we saw with pre-filled syringe is that it opened up a significantly larger patient population. And actually, and we said earlier, pre-filled syringe is driving the majority of the growth for us today. And so with auto-injector, I don't think it'll be as much of a step forward as pre-filled syringe. You'll recall that in the U.S., pre-filled syringe moved us out of healthcare administration into at-home administration. But the auto-injector will be a step forward in terms of patient convenience and ease. So I think that's an important consideration for how we compete in MG. In terms of Graves disease, clinicaltrials.gov covers all of the details that we want to disclose publicly. But I'm going to hand over to Beth to talk about some of the additional details.
Beth: Yeah, so we designed the GRAVE study taking into account, of course, precedent studies, and that was aligned with, you know, what the regulators wanted. So it's actually going to be two studies. You're going to see some kind of similar attributes of this study where we're actually dosing on top of antithyroid drugs. We're looking at patients at the end of the study who are euthyroid off antithyroids. So you're going to see kind of a tapering off that. You know, I think beyond that, we'll get into more details at a later date. But, you know, we're really excited about taking this off. We're focused on, you know, moving enrollment along as quickly as possible. And, yeah, more to come at a later date.
Operator: Your next question comes from the line of Akash Tiwari from Jefferies. Your line is open.
Akash Tiwari: Hey, thanks so much for the questions, and Karen, congrats on the new role. Very well deserved. Just on your Phase III myositis trial design, will the FDA allow you to file on pool data, or does each step need to be statistically significant for broad approval? And additionally, can you go over the rationale of your ADAPT-forward trials that look at Vevegard and EMPA in combination in GMG? What type of signal would you want to see to move that forward in larger studies? Thank you.
Karen Massey: Yeah, thanks for the question. So in terms of myositis, look, the label that we get, that will be a review decision, and we'll have to see how the data unfolds and let the data speak in each of the subtypes. So we look forward to that data in Q3. I'm glad you asked about ADAPT Forward because it's a key part of our combination strategy that I think we're uniquely positioned as Argenix to pursue in MG and also in some other of our indications like CIDP. So ADAPT Forward is a platform study, and what we're looking at is, can we dramatically increase the efficacy and outcomes for patients in MG? So what we're looking at is VivGuard as the backbone of therapy, and then looking at different combinations, for example, impasse-prubat on top of VivGuard, and can we increase the number of patients reaching MSC? Over time, it's a platform trial, so we will be adding different arms to the trial to explore different combinations that we have in our pipeline so that we can explore which we would want to move forward in Phase 3. Thanks for the question.
Operator: Your next question comes from Morgan Stanley. Your line is open.
Morgan Stanley Analyst: Good morning, Karen and Carl and team. Hope everyone's welcome. Two questions. The first one is your recent data presented at AAN for Vivgard and treatment-naive CIDP patients. How do you see that evolving? Do you see Vivgard potentially moving up into the front line? I think there's a lot of focus on just the cost of drug, but considering you've got just a short injection with Vivgard versus all the palaver that goes on with IG administration, just to give your view there and Second question is just on the IMNM opportunity, and I think, Karen, you mentioned a CIDP-like opportunity, but just give us a bit more color on the accessibility of that patient base. Are they readily diagnosed? What do you have to do there to get into that market? Thank you.
Karen Massey: Yeah, thanks for the question. I'm going to hand over to Sandrine to talk about the CIDP data. She was at AAN, and then I'll come back to the question on IMNM.
Sandrine: Yes, so great question. And indeed, in my preparatory remark, I mentioned that post-doc analysis, because I think it's data that we have never presented before showing that VivGuard can indeed have an impact, a sustainable impact and fast impact and efficacy on naive patients, truly naive patients. So we are very excited by this data. A few analysts picked that up. And I think this is going to expand the possibilities for VivGuard. Because if you look at our label in the US, we actually could be used first line. So there is actually theoretically no barriers to using. And so in practice, we see two barriers for broader usage in first line. The first one is indeed getting physician comfortable using it when patients are doing okay. And so that is very important to come with convincing data like the one in the post-hoc analysis, but also data like we are showing with the grip strength, where we show really very good efficacy on a sustained basis at 96 weeks. And the second barrier we are seeing is indeed payers. And you mentioned that in your question. So having data like the one we had in the postdoc analysis allows us to go back to payers and have a discussion because ultimately this is better for patients. So we believe this kind of data will help us move the needle step by step into broadening the market in first line for safeguard. So I'll hand it back to Karen for your other question.
Karen Massey: Thank you, Sandrine. Yeah, and in relation to your question on IMNM being a CIDP-like opportunity So the way that we see it is we size the addressable market as around 20,000 patients. But when you first look at the treated population of IMNM in claims data, it looks more like it's around 6,000 to 7,000 patients. So we think that those are quite easily accessible because there's no treatment options available at the moment. Beyond that, what we'll need to invest in, in the case of positive data, is really disease state education to increase awareness and increase diagnosis of this patient population but what the opportunity that we have is that imnm is frequently treated by neurologists and there's quite a lot of overlap with those neurologists with our mg and our cidp prescribers so we see the opportunity to build this market in the same way that we've built the cidp market We've built the MG market, and I think we'll see, assuming positive data, the same outcome in IM&M. Thanks for your question.
Operator: Before we go to the next question, I would just like to ask participants if they could please stick to one question per person so we can take as many questions as time permits. Thank you. Your next question comes from the line of Gavin Clark Gardner of Evercore. Your line is open.
Yijun (for Gavin Clark Gardner): Hi, this is Yijun for Gavin. Thanks for taking our question, and congrats on the strong quarter. So one question about the next generation molecule, 2N3, we saw it's become phase one ready. Just wondering, can you share more details on the timeline and how you are thinking about indication selection? And also for the phase three, will it be a non-inferiority study head-to-head against Wavergard, or is it going to be a standalone placebo-controlled study? Thank you.
Karen Massey: Yeah, thanks for the question. The strategy that we're laying out for FCRN is to continue our leadership for decades to come. And so as you mentioned, we have Argenix 213, which moves dosing to every four weeks. And we also have Argenix 124, another next generation asset in the FCRN space, as well as our program focused on developing an oral FCRN. So we have a portfolio of options here. for how we'll continue to build the FCRN space, explore the FCRN biology, and deliver value to patients. So we aren't public on our clinical development plan for 2.1.3 yet, but it is phase three ready, and we'll be moving quickly. And we see a few different opportunities. One is to advance patient outcomes in the indications we already have approval for, with 2.1.3 being a more convenient option. And we have the opportunity to expand the indications that we have FCRN approval in. So continuing to expand the boundaries, if you will, of FCRN biology. So we're really excited about our full FCRN portfolio, and we think that it'll be able to deliver growth for many years to come. Thanks for the question.
Operator: Your next question comes from line of Samantha Seminkel from Citi. Your line is open. Samantha, your line is open. Your next question comes in the line of Jacob McHale from Cape BC Securities. Your line is open.
Jacob McHale: Hi there, and thanks for taking my question. I have one maybe further down the line on the ORL at CRN and your collaboration with UMP. Maybe if you can share a bit more on how that's evolving And a follow up on that, you know, we see other disease areas that if you introduce an oral that could expand the market. So I'm keen to hear your view on the potential impact of an oral SCRN on the overall biologics market in MG and CRDP. Could this lead to further market expansion or do you see it more as a tool to prevent the competition from taking existing share?
Karen Massey: Yeah, thanks for the question on the oral. Our partnership with UNP is progressing incredibly well. They're great partners, and we're partnering with them on a number of targets, and FCRN being the first one. And exactly as you said, our strategy here is that we believe an oral FCRN can expand the market. You can imagine there are patients earlier in disease that would prefer to have an oral option rather than an injectable, even if it is a PFS that we have with VivGuard. So the strategy here across all of our indications, and as I mentioned on the prior question, even potentially in new indications is that we'll be able to bring more convenient options to patients that continue to deliver the same efficacy and safety standard that we've seen with VivGuard. Thanks for the question.
Operator: Your next question comes from the line of Victor Floch from BMP Paribus. Your line is open.
Victor Floch: Hi, thank you very much for taking my question. Maybe just a quick follow-up on 213. And I mean, I was looking at the initiation of the Graves' disease phase 3, and I was just wondering, how should we think in terms of additional safeguard phase 3 studies in new indication moving forward? Basically, should we assume that the Graves' disease program will be safeguard's final phase 3 for new indication, and that's any promising signal from the ongoing proof of concept studies will instead be pursued with the RGINX 2.1.3 due to IP considerations. So any comments on the lifecycle management there would be helpful. And maybe if I can just quiz one on CDP. You've mentioned that the penetration of biologics in MG was around 20%. Can you share the same metrics for CDP? And can you discuss the drivers that you have to further penetrate the market there? Thanks so much.
Karen Massey: Yeah, let me take the first question and I'll hand over the question on CIDP to Sandrine. So for Graves disease, we're pursuing Graves as an indication for VivGuard. And I wouldn't assume that future indications that we name are going to 213 or 124 or any of our future pipeline. We still see that we have a lot of runway with VivGuard and a strong development program with VivGuard. So we continue to invest and we'll continue to grow VivGuard And in parallel, we'll be developing 213, 124, and the oral as well. As I mentioned earlier, we see those molecules as a real expansion opportunity for FCRN. But let me hand it over to Sandrine to talk about the CIDP opportunity and market growth opportunity.
Sandrine: Yes, and I like that you picked that up on the 80% in MG being still, you know, among orals, where there is a huge market opportunity we see. Something similar with CIDP. So the total number of diagnosed patients for CIDP in the US is 42,000 patients. And 24,000 of these patients are treated. That means the remaining are not right now. They have been diagnosed, but they're not treated. Out of the 24,000 patients, 12,000 of them are on IVIG, but are not optimally treated. And these are the ones we have been focusing on when we started launching, because these are the ones that have a reason to switch to something better. And that's why we feel that VisGuard is the answer. The other 12,000 that are treated and feel optimally treated with the IVIG could also potentially switch to VisGuard because it could benefit from efficacy like the GRIP strength data where we showed strong efficacy. So you have to compare the 80 to 20 split of MG with what we see here in CIDP. I would say out of the 42,000, only 24,000 are treated. The others are not, so there is room there. And then 12 doesn't feel optimally treated, but there is an opportunity for us to expand the market beyond what we already see today. So still a big potential beyond what we have focused on until now. Thank you Sandrine.
Operator: Your next question comes from Miles Minter from William Blair. Your line is open.
Miles Minter: Hi team, this is John from Miles. Thanks so much for squeezing us in here. Wondering if you could talk a little bit about how you're viewing the evolving CIDP complement development landscape, especially as some of the early C1S inhibitor data has been suggestive of potentially best-in-class profile there. And as a follow-up, maybe if you could just talk a little bit about your views on knocking down both the leptin and classical pathway with C2 versus just knocking down the classical pathway.
Karen Massey: Yeah, thanks for the question on impasse-approved art. It's exciting to be bringing our second medicine potentially to market with our first phase three readout at the end of this year. Certainly from my perspective on the competitive data, I see this as a real confidence booster for why we're pursuing impasse-approved art in CIDP. It demonstrates that they're in CIDP. IgM is part of the driver of the disease and complement is at play. And so that reinforces why we think impasse-approved BART could have best-in-class potential in CIDP. And I think from a company perspective, Argenix is very well positioned in CIDP. There hasn't been innovation in CIDP in 30 years. The first innovation was VivGuard. And now, as we develop that market, we also in parallel are developing impasse-approved BART. So I think what you'll see is that we have the opportunity between VivGuard and impasse-approved BART to really shape that market and transform the market. And I think it'll look very different in the future from where it looks today as we really raise expectations of patients of what they can get from their medicine. So we're excited for that. In terms of the classic and the lectin pathway, the reason we chose C2 was very specific. And one of the reasons for that is because there are indications where the lectin pathway plays an important role. I was talking about DGF earlier. And so we think that it gives us better pipeline in a product opportunity by targeting C2 to be able to get the efficacy benefit there, but also the safety benefit of leaving the alternate pathway intact. Thanks for the question.
Operator: Your next question comes from line of Samantha Semenkal from Citi. Your line is open.
Samantha Semenkal: Hey, good morning. Thanks for taking the question. Apologies for the technical difficulties. Just wanted to follow up on a couple of the previous questions on combination strategy for both CIDP and MG. You know, how do you think about the market evolving? It seems combo therapies is a growing theme within INI. And as you start to see some of that data in the platform trials that you talked about, Karen, how do you see the market evolving there and your opportunity to continue being a leader in both indications? Thanks very much.
Karen Massey: Yeah, thanks for the question. And we had some technical difficulties earlier today as well. So no problem. In terms of our combination strategy, as you see, as you said, you can see that this is emerging in INI in a way that it's similar to how it did in oncology as well. So we're at the forefront of that and we're driving innovation. And I think we're very clear on what we want to achieve. You know, the value proposition for combination therapy has to be that it substantially raises efficacy outcomes for patients. I think that's the bar that we need to see in combination therapy. And you have to be able to deliver that efficacy benefit without a safety trade-off. So that's what we'll be looking for in the platform studies with the different approaches, the different combinations that we'll be testing. And as I said earlier, the reason we did a platform study is that that will allow us to test these quite quickly. And then when we see a signal, we'll be able to move quickly into phase three. with the goal that we always have as a company of elevating outcomes for patients. Thanks for the question.
Operator: That's all the time we have questions, all the questions we have time for. I'd like to hand the call back over to Karen Massey for closing remarks.
Karen Massey: Thank you everyone for the questions and the great discussion and we'll see you next quarter.
Operator: That does conclude our conference for today. Thank you for participating. You may now all disconnect.
