Progenics Pharmaceuticals, Inc. (PGNX) CEO Mark Baker on Q4 2018 Results - Earnings Call Transcript

About: Progenics Pharmaceuticals, Inc. (PGNX)
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Progenics Pharmaceuticals, Inc. (NASDAQ:PGNX) Q4 2018 Earnings Conference Call March 14, 2019 8:30 AM ET

Company Participants

Melissa Downs - Associate Director, Investor Relations

Mark Baker - Chief Executive Officer

Bryce Tenbarge - Senior Vice President of Commercial

Pat Fabbio - Executive Vice President & Chief Financial Officer

Conference Call Participants

Martin Auster - Credit Suisse

Chad Messer - Needham & Company

Tim Chiang - BTIG

Biren Amin - Jefferies


Good day, ladies and gentlemen and welcome to the Progenics Pharmaceuticals Fourth Quarter 2018 Results Conference Call. At this time, all participants are in a listen-only mode. Later, we will conduct a question-and-answer session and instructions will be given at that time. [Operator Instructions] As a reminder, today's conference may be recorded.

I would now like to turn the call over to Melissa Downs, Associate Director, Investor Relations. Ma'am, you may begin.

Melissa Downs

Thank you, operator. On behalf of Progenics management team, thank you for joining our conference call to review our fourth quarter and full year 2018 financial results and provide a business update. Joining the call today are Mark Baker, Chief Executive Officer; Bryce Tenbarge, Senior Vice President of Commercial; and Pat Fabbio, Executive Vice President and Chief Financial Officer.

Before we begin, I'll remind you that remarks made on this call that are not historical in nature may be forward-looking statements and are subject to a number of risks and uncertainties. Our actual results may differ materially. Such remarks may include, but are not limited to, those involving regulatory actions, clinical development and other matters related to our prostate cancer pipeline AZEDRA, RELISTOR and our other product candidates; our business and commercialization strategies; and expectations of future growth, revenues and assessments of our competitive positions.

Please see our most recent Forms 10-Q, 10-K and other filings with the U.S. Securities and Exchange Commission for additional information on the risks that could cause our actual results to differ. As a reminder, statements we make today are as of March 14, 2019 only.

I will make -- I will now turn the call over to our Chief Executive Officer, Mark Baker. Mark?

Mark Baker

Thank you, Melissa, and good morning to everybody joining us today. 2018 was a transformative and productive year for Progenics, as we transitioned into a fully integrated organization with the approval of AZEDRA for the treatment of patients with unresectable, locally advanced or metastatic pheochromocytoma, or pheo, and paraganglioma, or para.

AZEDRA's approval represents the first and only approved therapy for these indications and we are working hard to broaden AZEDRA's reach across the U.S. through our ongoing commercial launch efforts and life cycle management initiatives. Bryce will provide an update on our commercial activities momentarily.

In parallel with our commercial efforts, over the course of the last year we have been advancing our pipeline of innovative radiopharmaceuticals. We delivered data, which highlights the potential of our candidates and digital technology, advanced our PSMA targeted imaging agents and therapeutics into later-stage development and formed a validating partnership with Curium, that both extends the reach of our programs and accelerates development.

To support our initiatives, we expanded our leadership team and have the right team and expertise in place to take us through our next stage of growth. In January, we were thrilled to announce the appointment of Dr. Asha Das in the newly created role of Chief Medical Officer.

Asha has extensive experience in drug development, including leading activities related to the approval and launch of Avastin and multiple indications at Genentech, as well as a decade of clinical practice and academic expertise in neurology and neuro-oncology.

She joins us from Tocagen, where she served as Chief Medical Officer and led the development of the company's cancer selective gene therapy platform. Asha is already playing a critical leadership role in developing and executing our clinical development strategy for our prostate cancer pipeline.

In addition, as Head of our Medical Affairs Group she will have insights into both a KOL and patient perspectives that will help inform our life cycle management initiatives for AZEDRA, a high priority to us. We believe that there are significant opportunities to expand the market for AZEDRA into additional indications and are actively pursuing a registration pathway for an expanded label.

Last month, we conducted an advisory board meeting with leading KOLs with expertise in neuroendocrine tumors, neuroblastoma and medullary thyroid cancer. We left the meeting confident that there is a strong interest in exploring AZEDRA in multiple MIBG-avid tumors, including gastroenteropancreatic neuroendocrine tumors, or GEP-NETs, and other neuroendocrine tumors. These are indications that have a high unmet need for new treatments. In consultation with leading experts we have developed a basket trial approach and plan to meet with the FDA soon.

Turning to manufacturing. In February, we acquired the Somerset New Jersey manufacturing facility for AZEDRA, allowing us to build up our internal manufacturing capabilities. In addition to serving as the launch facility for AZEDRA, Progenics Somerset will also provide manufacturing support for our development-stage radiopharmaceuticals, including 1095.

As a part of the acquisition, we also secured the long-term supply of iodine, necessary for the production of both AZEDRA and 1095. These efforts have now positioned us to fully integrate our operation and increase alignment with our commercial launch initiatives.

Let me turn to an update on our PSMA-targeted imaging agents and therapeutics programs, starting with PyL. In the fall, we announced top line data from our Phase 2/3 OSPREY study that supported advancing the program into Phase 3.

PyL showed high sensitivity in reliably detecting distant metastatic prostate cancer lesions and high specificity in confirming the absence of pelvic lymph node disease. The associated strong predictive -- positive predictive value and negative predictive value of PyL further underscore its potential clinical utility. We look forward to presenting the data at a medical meeting in the coming months.

Importantly, these results were used to inform the design of our Phase 3 CONDOR trial, which commenced in December. We've been encouraged by investigator interest in this trial, which is translating into rapid enrollment.

As a reminder, this is a multi-center open-label study enrolling men with biochemical recurrence of prostate cancer in the U.S. and Canada. The primary endpoint is based on a positive predictive value and will assess the collect -- correct localization rate which is defined as the percentage of subjects with a 1:1 correspondence, between localization of at least one lesion identified by PyL and the composite true standard.

We are also evaluating the percentage of patients with a change in intended prostate cancer treatment plans due to PyL as a key secondary endpoint. We remain on track to complete enrollment by year-end. In addition to our ongoing studies, PyL's potential activity is also being explored in 12 investigator-sponsored studies at various academic institutions across the U.S. and Canada.

We see additional opportunities for PyL outside the U.S. And earlier this year we granted Curium exclusive rights to develop and commercialize PyL in Europe. Curium is an ideal partner to help expand the global reach of PyL.

They are the largest global nuclear medicine company, formed through the union of the nuclear medicine assets of Mallinckrodt and IBA Molecular. We understand from Curium that it plans to meet with the EMA to agree upon the regulatory path forward for PyL in 2019. We look forward to providing an update.

In addition to our development strategy for PyL plans are being developed to use PyL in trials for our two PSMA-targeted radiopharmaceuticals 1095 and TTC. For both studies PyL is being used to determine tumor avidity, showcasing the synergistic potential of our imaging and therapeutic product portfolio.

For 1095, we are looking forward to initiating our Phase 2 trial in the second quarter. We are extremely excited about this program. 1095 radiotherapy represents a new mechanism of action that may overcome resistance developed to novel androgen axis drugs or NAADs such as abiraterone and enzalutamide.

In addition recent preclinical research shows that enzalutamide can sensitize cells to radiotherapy induced cell death suggesting that 1095 in combination with enzalutamide has the potential to be an effective treatment paradigm for patients with metastatic castration-resistant prostate cancer or mCRPC, who are resistant to NAADs.

Our Phase 2 trial protocol builds on this preclinical data. We will evaluate 1095 and mCRPC patients who are PSMA-avid, chemotherapy-naive and who have progressed on abiraterone another NAAD. The primary endpoint is PSA response rate according to prostate cancer clinical trials working group three criteria. Given our strong belief in the program, we plan to assess Phase 3 plans this year should initial data be positive.

Our earlier-stage PSMA-targeted radiotherapeutic program is PSMA-TTC, which is partnered with Bayer. They are recently initiated a Phase 1 trial in patients with metastatic castration-resistant prostate cancer.

Let's turn now to our artificial intelligence efforts. We are very excited about this initiative and the increasing recognition that the intersection of AI with health care has tremendous potential to drive significant changes in how we practice medicine.

Certainly, Eric Topol's new book Deep Medicine including his recent media appearances has generated tremendous interest in the potential of AI and medicine to impact lives. His book shines a spotlight on specific examples and outlines how applying AI to medical imaging can transform treatment decisions and ultimately improve patient outcomes. We have made great progress with our digital technology portfolio consistent with this vision.

For PSMA AI and imaging analysis technology that uses AI and machine learning to quantify and automate the reading of PSMA-targeted imaging, we recently completed a prospectively planned, retrospective analysis using PSMA AI to automatically assess a set of images from prior trials. The reads with PSMA AI demonstrated a statistically significant improvement over manual assessment in terms of accuracy, reproducibility and speed. We're very excited by this result and expect to present the full data set in an upcoming scientific conference. I'm proud of the progress across our PSMA and AI portfolio of products and look forward to a busy 2019 ahead.

Now to Bryce on the commercial update. Bryce?

Bryce Tenbarge

Thanks, Mark. Since receiving FDA approval for AZEDRA last year, we have executed on our commercial launch plan. As many of you know, our launch team consists of our specialized sales representatives and access teams, individuals with dual oncology sales and nuclear medicine backgrounds, medical science liaisons and reimbursement and payer specialists. The majority of pheo and para patients in the U.S. are treated at approximately 25 multidisciplinary centers with specialized resources.

On top of these centers, we have received inbound interest from other institutions in key geographic regions that have expressed interest in utilizing AZEDRA. As a result, we are now in active dialogue with more than 30 centers interested in offering AZEDRA to their patients. Eight centers are fully activated and have already received treatment requests. Five additional centers will be ready in the next few weeks and we expect that the remainder centers will be activated this year. We received 14 treatment requests for patients to be treated at the eight active centers. We expect additional requests from the other targeted centers as they are activated. Our team has established referral networks to enable patient access to treatment and created patient services programs to support out-of-pocket needs including travel.

Our market access teams continue to work diligently to ensure reimbursement is in place and that the proper support is available to our hospitals in the coding and billing assistance. Recall that AZEDRA was added to the National Comprehensive Cancer Network Clinical Practice Guidelines in Oncology for neuroendocrine and adrenal tumors in August of 2018. These NCCN Guidelines are widely recognized and used as the standard for clinical policy in oncology by clinicians and payers. Since FDA approval AZEDRA has also been added to five important drug compendia. These compendia are recognized by private and public payers, including CMS as authoritative reference sources in determining drug reimbursement.

Just this past week, we presented data to the CMS ICD-10 Coordination and Maintenance Committee to garner a code associated with AZEDRA, which supports our efforts to secure new technology add-on payment or NTAP. In addition, our pass-through C code was approved and is in place and we anticipate that our permanent A code will be awarded soon.

Our medical affairs team is also continuing to build our presence in a greater community and educate physicians on the potential for AZEDRA. Later this month, a poster presentation showcasing the AZEDRA safety profile will be presented at the Endocrine Society Annual Meeting on March 24.

I would like to commend all of those involved in the AZEDRA commercial launch for their work to-date and we look forward to sharing more progress on our efforts throughout 2019.

I would now like to turn the call over to Pat Fabbio our Chief Financial Officer. Pat?

Pat Fabbio

Thanks, Bryce. You can review details of our financials in the press release we issued this morning and in the 10-K that we will file later today. Fourth quarter revenue totaled $3.2 million down from $3.9 million in the fourth quarter of 2017, reflecting RELISTOR royalty income of $3.2 million compared to $3.7 million in the corresponding period of 2017.

Fourth quarter RELISTOR net sales were $21 million, as reported by our partner Bausch Health. Full year 2018 revenue totaled $15.6 million, up from $11.7 million for the full year of 2017, resulting primarily from higher royalty income.

Research and development expenses decreased by $1.3 million and $7.4 million in the fourth quarter and full year 2018 respectively compared to the corresponding periods in 2017 resulting primarily from lower external cost associated with the completion of the pivotal Phase 2 trial for AZEDRA and the Phase 3 trial for 1404.

Fourth quarter and full year selling, general and administrative expenses increased by $1.2 million and $4.5 million respectively compared to the corresponding prior period in 2017, primarily attributable to higher cost associated with the commercial launch of AZEDRA. We recorded a net non-cash charge of $17.4 million in 2018 resulting from changes in estimated fair values of intangible assets and contingent consideration liability primarily related to 1404.

Fourth quarter and full year 2018 interest expense was $1.1 million and $4.7 million, respectively related to the RELISTOR royalty back loan. And we had an income tax benefit of $100,000 and $1.6 million, respectively mainly driven by the impairment of indefinite lived intangibles for in process research and development assets.

Our net loss for the fourth quarter was $14.7 million or $0.17 per diluted share, compared to a net loss of $2.7 million or $0.04 per diluted share in the corresponding 2017 period. Net loss for the full year 2018 was $67.7 million or $0.87 per diluted share, compared to a net loss of $51 million or $0.73 per diluted share for the full year 2017.

In terms of our cash position, we ended the year with cash and cash equivalents of $137.7 million, reflecting a decrease of $11.2 million in the quarter and an increase of $47 million from 2017 year-end. The increase in cash from 2017 year-end includes net proceeds of $70 million from the sale of common stock in an underwritten public offering in August of 2018 and $27.5 million from the sale of common stock in at the market transactions.

And now, I'll turn the call back over to Mark to conclude.

Mark Baker

Thanks, Pat. I'd like to thank the dedicated Progenics team for their support in the execution of our commercial development and operational goals. We delivered many accomplishments in 2018, most notably the FDA's approval of AZEDRA as well as significant progress across our entire prostate cancer and AI portfolio. Motivated by our vision to find, fight and follow cancer, we're well-positioned for continued progress across all our radiopharmaceutical programs in 2019.

Before we open the call for questions, I do want to note that today we issued a release regarding PSMA-617. We have asserted our ownership of worldwide composition of matter patent filings related to PSMA-617 and PSMA targeted radiopharmaceutical compound under development by Novartis for the treatment of prostate cancer.

We assert that PSMA-617 arose from sponsored research collaborations between the University of Heidelberg and Molecular Insight Pharmaceuticals or MIP prior to its acquisition by Progenics. MIP filed a complaint against the university in the District Court of Manheim in Germany.

In December, the European patent office granted MIP's request and stayed the examination of the patent applications in dispute. On February 27th of this year, Endocyte a wholly-owned subsidiary of Novartis filed a motion to intervene in the German litigation. Novartis through Endocyte is the exclusive licensee of the patent rights that are the subject of the German proceedings.

With that, I'll open the call for questions. Operator?

Question-and-Answer Session


Thank you. [Operator Instructions] And our first question comes from the line of Martin Auster with Credit Suisse. Your line is open.

Martin Auster

Hi, everybody. Thanks for taking my question. I guess, I had a couple of follow-ups on the AZEDRA launch. I was curious about for the initial patients that are being lined up, what the time frame has been where you've been working to get those 14 patients in queue. And I want to get a sense overall for the eight centers that are activated, how rapidly you think you can achieve full penetration for the appropriate target AZEDRA population?

And then finally maybe if you could comment a little bit to the gating steps that are necessary to activate the remaining 22 or so centers that you're working to get online over the course of 2019. Thank you.

Mark Baker

Thank you. Bryce, do you want to tackle that one?

Bryce Tenbarge

Sure. Yeah. So we've had centers on board since the end of 2018 and more coming on each week. The fact of the matter is right there were nine centers in our clinical trial program, right? As I constantly speak to we always know that we're going to have to facilitate some trial just given the -- that the patients are everywhere and that again even when we achieve full site penetration of 25 to 30, we'll have to facilitate that kind of travel.

So I would suggest that even though numbers of eight plus an additional five, certainly when we get to 25 or 30, we feel really good about our ability to treat the patients who need the product even today, given the fact that the centers who are of course on board now are the larger more experienced centers with the most robust facilities. And, of course, again we'll continue to add to that.

In terms of gating steps, yeah, it's a process. And again it varies by center and they're coming in readiness status. But all centers right, once the product is approved have to put it through their internal committees like pharmacy and therapeutics. These things do take time. There are various nuclear medicine department staffing training requirements things that we have been assisting with and continue to do so.

And then those are the things that we're most actively doing today. And then, of course, we're also suggested right reaching out to centers and getting incoming calls from centers who are really starting from the beginning. So those centers had a bit of a longer time line, working with them to get their required licensure things of this nature, understanding the basics of the product, and then all the steps that I mentioned previously.

So again from a center readiness standpoint, I'm actually feeling quite positive about it. And I think we're now at a point where a lot of this work is culminating. And we'll see I think centers added more rapidly to that list. But I'm very pleased right that the eight we have turned on today are geographically dispersed, which I think mitigates the burden for patients as we work to schedule them.

Mark Baker

And to me an encouraging aspect is the number of patients that these eight centers have turned up in terms of 14 treatment requests and more moving along the process. So, we're seeing as we bring centers on that they're bringing patients on and encouraged by those numbers and the demand we're seeing from the sites that are in the queue to be activated. When we hear from these centers talking to us in terms of how many patients per month, they think that they will be bringing to AZEDRA, and so it's also been encouraging to see their longer range thinking.

Martin Auster

Thanks, Mark. And just a quick clarification. Once these centers are turned on, is it fair for us to expect that AZEDRA should achieve a pretty full penetration into that target market within a reasonably short amount of time at that particular center realizing that the process overall will take longer across the country?

Mark Baker

Yeah, I think that is reasonable. And we also see as I think Bryce was saying that the patients have to fly anyway. So, if there's -- if their closest center is not yet up to speed, they can fly to another center. So, I think that there's good redundancy and so that's why we're encouraged by the number of centers on Board and the number that we see coming on soon.

Martin Auster

Okay. Thank you.


Thank you. Our next question comes from the line of Chad Messer with Needham. Your line is open.

Chad Messer

Great. Good morning. Thanks for taking my question and thanks for answers to the prior questioner. That's helpful. Every one of these orphan diseases it's a big learning process for us analysts and we don't seem to get it right at the beginning very often.

Could you just speak a little bit more about what has to happen after a treatment request actually treat a patient? Is it simply as you've been talking about scheduling travel or is there more involved?

Mark Baker

You need to ensure that the patient has access, so you have to go through that process which many of these patients have. But you don't want to start a patient down the road unless they have access to the product. One other element of surprise is the patient is moving through the process here.

Bryce Tenbarge

Yes. So, I mean with AZEDRA right there is -- once a treatment request has been made there is the necessary test for avidity and dosimetry. We do feel -- I think we've seen that the majority of patients here have already been scanned for MIBG positivity, so we don't expect the -- any real reduction in numbers there.

But Chad that's the step, right? You get the request, you then schedule the dosimetry, you ascertain avidity, and the right -- I'm sorry the right dose for AZEDRA moving forward and then you schedule the subsequent therapeutic doses. So, that's the process. Each -- it takes a little time there even after the patient request.

Chad Messer

Okay, helpful. And just because I've seen this in other launches. At least the access part of it insofar as to hold up is it reasonable to assume that as sites and you with a site gain experience in obtaining and confirming access that process should speed up over time?

Mark Baker

Yes. This is in-patient. So, at each institution I think we've got to get one patient through from each payer and go through the paperwork and the requirement that the doctors involved are pushing for the treatment which of course they are.

Once you've got that pattern established, then I think the time to establish that reimbursement comes way down. But we're in that initial phase. And we have members on the commercial team who are highly focused on getting that work done.

Chad Messer

All right, great. Thanks. Helpful. And maybe you can just talk about the patent dispute you now have going on with Novartis. Can you start by telling us where PSMA-617 is in development? And what we -- what sort of data is available on it and how it's being developed?

Mark Baker

So, 617 is the compound that Endocyte was developing and it's in Phase 3 trials now. And Endocyte of course was acquired by Novartis. So, Novartis now developing 617 in Phase 3. 617 is a drug that targets PSMA. The targeting moiety I've been saying to you is so close to the targeting moiety in 1095 and now you understand that.

It uses lutetium as the isotope compared to our 1095 which uses iodine. And the initial development plan for 617 as we understand it is to evaluate it in post -- in the post-chemo setting. So, this Phase 3 trial underway post-chemo which is a surprising setting to us for them to pick because PSMA expression does begin to decline after chemotherapy.

In contrast to our 1095 which is being tested pre-chemo in the setting of abiraterone failures who have gone on to enzalutamide. So, we've got a differentiated 1095 from 617. But our allegation in the lawsuit and our strong belief is that 617 was developed under an agreement -- a development agreement with Molecular Insight, our subsidiary and that ownership of those patents properly belongs with us. And so that litigation now underway in Germany.

So, as you see we have extremely strong position in PSMA with multiple programs that we have undertaken and have underway. And here you see another example of the depth of our assets in the PSMA space with our belief that we have an ownership interest in the 617 drug.

And I've often said Chad if PSMA targeting imaging or therapy is successful and improving treatment for prostate cancer patients which we truly believe that is the case we're going to be sure that the owners of our company are going to benefit from that.

Chad Messer

Okay. Well as you know Mark this patent litigation sometimes proceeded at notoriously glacial paces. Can you maybe tell us what the next step in this that we should look for and any idea how long it might take?

Mark Baker

Yes, it's -- litigation is difficult to predict. And we are in a German court, so we're learning about how the German courts proceed. If I could give you any sort of general view on that I think that the German court will proceed at least as quickly maybe more quickly than you would see, for example, in the federal courts here in the U.S.

So, I'm not expecting an extremely protracted situation. But on the other hand I should say that probably it does take nine months or a year for this thing to come to fruition in terms of the litigation.

So, I'd put it somewhere in the middle Chad. It's not like going into a state court here in the United States. And I think we'll get to some outcome a little more quickly than you would expect in a federal court.

Chad Messer

Okay, all right. Good luck with that. Then just on this AI data that you generated you kind of alluded to it vaguely, I presume, because you want to save all the real goodies for a publication or a presentation at a conference.

But when you say that you beat statistically readers, can you maybe talk about what the arbiter what the gold standard was there? Was this one of your studies where you actually had a prostate removed and you had histology to sort of determine who is "correct"?

Mark Baker

Correct, that's right.

Chad Messer

Okay. All right.

Mark Baker

Yes. So, I mean what we're seeing is that when you use AI the readers become much better, right? So, we're not of the view that AI will replace radiologists, but we are of the view that radiologists who use AI will replace radiologists who don't. And the great, great advantage that we have in the AI space with the PSMA-targeted agents is that, that provides a very clean dataset for the AI.

If you're dealing with other modalities, MRI or bone scans, you got lots of different machines, lots of different interpretations it's a lot of noise in that. But when you use a molecularly targeted agent like PyL, now you've got very specific data and that provides the best basis to build artificial intelligence. So as you're looking at artificial intelligence, I mean you can't avoid seeing it on the television these days. And you're thinking about how that will affect prostate cancer.

I think it's fair to say that Progenics has the leading position in that space. In fact, we're way ahead of everybody else because of our work on the algorithms, the artificial intelligence and the machine learning and because of the datasets of very clean data that we've built on.

Q – Chad Messer

Yes. No I was going to say that excited to learn more about that. And then maybe just one last quick one on RELISTOR, kind of looking back over 2018, 3Q blipped out on the back of -- on the royalty line. It's like a $5 million number as opposed to $3 million the other quarters. Anything is Bausch -- anything about that would kind of explain that blip? Thanks for taking all my questions.

A – Mark Baker

Pat, do you want to handle that one?

A – Pat Fabbio

Yes. Sure Chad. The third quarter was impacted by a favorable adjustment to -- with MIP's estimates for accruals for sales returns. So they had adjusted that estimate and it increased -- and it affected the gross to net that particular quarter, so onetime favorable adjustment that quarter. And then fourth quarter, we were looking for something a little bit more in line with the underlying demand in the scripts. But as Bausch had mentioned, they had a planned channel inventory reduction which impacted the fourth quarter's net sales.

Q – Chad Messer

All right. Great. Thanks again.

A – Pat Fabbio

Thanks Chad.


Thank you. Our next question comes from the line of Tim Chiang with BTIG. Your line is open.

Q – Tim Chiang

Hi, thanks. Mark, you mentioned the potential for additional indications that you might go for with AZEDRA. Can you talk a little bit about the timing of when you might start trials on some of these other indications?

A – Mark Baker

So yes, thanks for that question Tim. We believe we'll get this basket trial that we mentioned up and running by the end of the year. Our approach would be for a biomarker-defined tumor type and the biomarker here is avidity on MIBG imaging. So that could cover a broad range of cancers. We have brought KOLs and as I mentioned in my remarks to talk about the potential there and we had very strong interest. And we're taking advantage of the FDA's openness to approve and give indications based on biomarker definition. So if we're successful here, we're hoping to be able through the basket trial to gain a label of MIBG avidity in these difficult-to-treat neuroendocrine tumors.

As we look at the numbers there, we're seeing many multiples maybe than an order of magnitude higher number of patients. But each of these indications has a different set of factors that apply to it. So we'll also be working this year to better define the total patient numbers. But suffice it to say if we were able to get this biomarker-defined tumor type, we'd be dramatically increasing the size of population that could use AZEDRA.

The timing of that we'll have to work out with our -- with the FDA after the FDA meeting. We're thinking of a trial in the size of 100 to 125 patients across four or five different tumor types of the traditional definition. With our AZEDRA trial in pheo and para, it took us about a year to enroll around 25 patients. So I'm thinking that enrollment would be in that year range. And then the follow-up to get to the data necessary for filing will depend on the endpoint. But we're thinking it's likely to be our response endpoint with a relatively quick readout. So I think, when you add that all up it's a couple years. But what we really liked about it is how compelling the KOLs found the idea. So we're going to be excited to get that going.

Q – Tim Chiang

That's helpful. I think you guys also highlighted that you're going to present some safety data on AZEDRA at the -- this upcoming ENDO conference. I mean how important is this data per se to the launch of AZEDRA? Or I mean obviously safety is important. But I mean, what do you think are the most important key items that your customers are looking for as you guys launch AZEDRA here?

Mark Baker

To me, it's the data around hypertensive heart crisis. And alternate treatments in this space have this -- the terrible side effect that the giving of the treatment itself can lead to a heart crisis for the patient. So the data we are showing how that does not impact AZEDRA, I think is critical for the patients, but also for the doctors, right, who have to be with alternate treatments in that difficult position of having a patient go into a heart crisis as they're treating the patient. So that's number one. Bryce, what other elements do you think are important from a commercial perspective in terms of the side effect profile?

Bryce Tenbarge

Yes. It's really as you mentioned, I must say, the known side effect profile of AZEDRA is so superior in terms of what we know about it to alternative therapies for pheo and para that I can't really identify that as an objection by any stretch. To me, one of the things that I'm looking forward to most in the daily presentation is almost as much as the data itself as the venue, right?

Endocrinologists for us are really the key referral. And now that we've been so active getting these nuclear medicine departments and these institutions and their offices ready to go, we want to continue to make the push into endocrinology right and get the word out about AZEDRA, both its efficacy and safety profile. So to me, Tim, that's the biggest plus from the data itself. And in this data too will combine all of the patients who have been previously treated with AZEDRA, right, which includes a not small subset of neuroblastoma patients. And I think that too is important for the broader community's understanding of the overall potential of AZEDRA.

Tim Chiang

Okay. That's helpful. Maybe just one last question. Given the fact that you guys are going to all these different treatment centers in the U.S. I mean, how comfortable are you in terms of the number of patients that have been identified at this point with pheo and para that are -- that would be eligible for AZEDRA? Do you guys have a better number in terms of what the target patient population is here in the U.S.? Is it 400 patients? Is it 800 patients? Is it somewhere in between that?

Bryce Tenbarge

Yes, Tim. I anticipated this question. And the answer to the question as to whether or not we've changed our viewings on that is, no. Now treatment requests are one thing, right? Treatment requests are -- the process has started. But we hear continuously from centers who are ready to go and from others that there are patients who are likely expected on an ongoing basis, right, who are eligible for this product. And when we add those numbers up amongst all the centers that we're speaking to, we reside comfortably in that 400 to 800 eligible patients, right?

Now that's the eligible patient population and we apply avidity to that. We still think the vast majority of those patients are avid of course. But we're not ready to adjust what we think the expectations are on that front. In fact, and I think all of you realize this right, it's a very hard market to model. And so these conversations we're having on a daily basis right are really to me the best source of information.

Mark Baker

Yes, yes. We started from the top down right to get to those numbers originally. Now we have a strong bottoms-up view. So I think our view is we continue to be within that range. And we're not ready quite yet to guide to sales numbers, but we're gaining the confidence now. And we're -- hopefully, we'll be able to provide that kind of information to the market in the future. But for now, yes, encouraged by the actual request and discussions with the centers about the patient flow that they see over the course of the year.

Tim Chiang

Okay, great. Thanks.


Thank you. [Operator Instructions] Our next question comes from the line of Biren Amin with Jefferies. Your line is open.

Biren Amin

Hey, guys. Thanks for taking my questions. So Mark, just on the AZEDRA launch, I know you've highlighted numerously on this call that you have had 14 patient treatment requests. Can you tell us whether these patients have gone through dosimetry? And if they have, have they received first dose? Just walk us through that, because also I know you're probably not going to guide for this year, given it's an early launch, but I think consensus is around $30 million $32 million and that kind of implies about 120 patients treated, if you assume 75% receive a second dose. So I know there's couple of question in there. So how should we think about as you traject forward and these 14 patients have they been treated with the first dose?

Mark Baker

Yes. No, there've been no treatments with the first dose. And the dosimetry doses are being scheduled now. So I don't think we're going to get from a dosimetry dose to a treatment dose this quarter. So I think revenue will begin next quarter.

Biren Amin

Okay. And then how should we think about the $30 million, $32 million consensus because that kind of implies about 120 patients treated this year?

Mark Baker

Yeah. We're not ready to guide to numbers. But yeah, I am confident that we're going to see good uptake. And so, I don't think I can give you more perspective than that, but we wanted to be open today to talk about where we stand with centers and the treatment requests. So, you can begin to get a sense of the market as we're developing our sense of the market.

Biren Amin

And then when you said -- I think that you made some comments on -- that you hope to facilitate some travel. What is that? Is that simply helping patients to get to the center? Is that assisting them in overnight stays at these centers? What type of costs are associated with that?

Mark Baker

Yeah, because the patients generally are traveling, right, and generally will require some kind of overnight stay.

Bryce, what exactly do we reimburse with the travel cost?

Bryce Tenbarge

Yeah, largely travel and if they're -- both for the patient and for the caretakers, right, who need to stay in the area their accommodations. It does differ by the type of insurance that the patient is eligible for and what we're allowed to do from a compliance standpoint. So, we thought all that through.

Majority of patients, though, as we've said, are commercially insured and that affords us some latitude to make sure that those -- the costs associated with that part of it don't impede a patient's ability to receive the product that they need.

Mark Baker

When you survey pheo and para patients and you ask them what's the most difficult part of your treatment, in almost all cases travel tops the list. And, of course, with the dosimetry dose and then with two therapy doses, there is significant travel. So, I think, it's quite valuable that we're able to help the commercial patients in that case.

Biren Amin

Got it. And then just on the 671 IP litigation, just want to go through this a bit, because it seems like MIP had this since pre-2013. And Endocyte acquired the asset, I think, in fall of 2017. Why didn't -- why wasn't litigation pursued at that point in time when the asset was licensed to Endocyte?

Mark Baker

Well, for us, litigation is a -- is the last thing we want to do, particularly with a university. And I've been to the University of Heidelberg and I've seen how they take care of prostate cancer patients. And I'm a great admirer of their work.

But on the other hand, we have to protect our IP. And we reached out to the hospital and asked them why we weren't given our rights here and why they didn't provide us the rights that we had under our contract. And they never answered. So, at the end, we had to take a litigation action. But for us, it's a last resort.

And we were waiting for the hospital to tell us why we might be wrong in our assertions. And to date, even in the court interaction, they've given us no reason why our position is incorrect.

So, that's why we're pursuing it. And it's just important, I think, for a pharmaceutical company, a biotech company to take the actions necessary to protect its intellectual property and that's why we moved to this final stuff here.

Biren Amin

And so, what could be a potential outcome? Is it some sort of a royalty that one would seek? Or -- so, I guess, what's the possible outcome if you succeed on this?

Mark Baker

Well, what we're seeking is co-ownership of the patents, which for those not familiar with patents is a bit of a difficult concept that two entities could own a single patent, but under patent law that is possible. And both parties then have the ability to practice the patent.

So, if successful here, we would have the right to practice these patents and sell 617. And if successful, we could do that ourselves or that we could license that to some other pharmaceutical company.

So, that's where we could end up. Obviously, in litigation, settlements are typical. So, another outcome is that there would be some sort of settlement relating to this. But at this point, it's way too early for me to speculate what that might be.

Biren Amin

Okay. Great. Thank you.


Thank you. And I'm showing no further questions at this time. I would now like to turn the call back to Mr. Mark Baker, Chief Executive Officer, for closing remarks.

Mark Baker

Thank you, all, again, for joining us this morning to review our continued progress, financial results and upcoming milestones. We look forward to speaking to you again soon.


Ladies and gentlemen, thank you for participating in today's conference. This does conclude the program. You may all disconnect. Everyone have a great day.