Pharming Group NV

AEX:PHARM

Earnings Call Transcript 2021-Q2

[Operator]

Good morning, everyone. Thank you for joining the Pharming Group Half Year Results 2021 Conference. My name is Terrence. I'll be moderating your call today. [Operator Instructions] I now have the pleasure to hand over to Sijmen de Vries. Please go ahead.

[Sijmen de Vries, President, CEO & Executive Director]

Thank you very much. Good morning, good afternoon, ladies and gentlemen. I'm sitting here with our Chief Financial Officer, Jeroen Wakkerman, to take you through the half year results 2021. But before I do that, next slide, please, I would like to draw your attention to this slide that you will see in front of you now showing -- the slide on the forward-looking statements because we will be making some forward-looking statements that are based upon our current plans or beliefs and that may change from time to time as -- on -- it's impossible to predict any new risks and uncertainties that may emerge from time to time. So having said that, let's go and have a look at the next slide, please. And whilst that slide is coming up, I'll start introducing the company. So we are a revenue-generating and profitable, dual-listed Dutch biopharmaceutical company, and we're really investing at this point in time in building up our company towards the long term. That means we are investing in development of recombinant human proteins from our own platform. And of course, our lead product is, in this case, a recombinant human C1 esterase inhibitor, RUCONEST, which is approved for the treatment of acute angioedema attacks in patients with hereditary angioedema and where we have additional indications in clinical development. But we're also investing in extensions of in-licensed development pipeline. We in-licensed a late-stage compound leniolisib for the treatment of APDS from Novartis about good 1.5 years ago. That is late stage. And we recently in-licensed an early stage ex vivo hematopoietic stem cell therapy from Orchard Therapeutics for the potential treatment of hereditary angioedema. And we are -- we can do this from our own means. That means we are profitable from revenues from our own commercial infrastructure and selling RUCONEST in the U.S. and in the European Union, and we have some partnerships in other territories of the world. And that means we can fund all these investments from our own cash flows.Next slide, please. And I would like to take you on this slide through the operational highlights. We had a very busy first half of 2021. And we got reimbursement in Spain for RUCONEST. So we will soon be able to bring RUCONEST into the Spanish market as a result of that. We also announced the successful completion of patient enrollment in the pivotal trial for leniolisib for APDS. And that means that we're still aiming for anticipated launch of leniolisib at the end of 2021 -- '22 next year, subject, of course, to regulatory approval. And because the launch is coming near, we also started working and investing in premarketing activities, and we launched the navigateAPDS program, sponsored generic testing program in collaboration with Invitae Corporation that is designed to assist the clinicians in identifying those patients and their family members with APDS.Then we were very pleased that we could finally start the Phase IIb double-blind, randomized, controlled study to -- for RUCONEST in the prevention of acute kidney injury after non-ST myocardial infarction at the University of Basel in Switzerland and other centers. And we got a few new colleagues. We got 3 confirmed new Board members on -- in our Annual Meeting of Shareholders in May: Steven Baert, Leon Kruimer and Jabine van der Meijs to our Board. And last but not least, we got 2 new colleagues in the executive committee of the company, Anurag Relan as Chief Medical Officer; and Robert Friesen as Chief Scientific Officer, as new members of our Executive Committee. So post operational highlights were 2. We entered into an exclusive new license agreement with NewBridge Pharmaceuticals for the distribution of RUCONEST in the Middle East and North Africa. And last but not least, we announced the strategic collaboration with Orchard Therapeutics to develop, manufacture and commercialize OTL-105, which is a new investigational, ex vivo, autologous, hematopoietic stem cell therapy for the treatment of hereditary angioedema. And OTL is designed to increase the C1-esterase inhibitor concentration in the HAE patient terms to prevent HAE attacks in a similar mode of action as RUCONEST, therefore. So very busy times, and lots of new developments in the company.And that brings me to the next slide, please. Because the last collaboration that we just discussed with Orchard Therapeutics is exactly what we're working on with regards to our 3-pillar strategy for growth. On the left-hand side, you see the growth-enabling sales of RUCONEST, bringing in the revenues that enable us to invest in all these other opportunities. And of course, the long-term view that we have here by in-licensing the early stage asset OTL-105 for hereditary angioedema is a very good example, although we are executing against this 3-pillar strategy for growth. In the middle, you see the developing -- continued clinical development for recombinant C1 esterase inhibitor for additional large unmet medical indications and the transgenic manufacturing technology, where we are developing a next-generation protein replacement therapies. And there, we have, of course, the early-stage compound of a glucose today, so Pompe disease still in development. And then we move on to the right-hand side, where we continue to execute on the in-licensing and searching for new candidates -- for late-stage candidates. And of course, this is a very good example of where we got the first product in. And as I said before, we're aiming for a launch late next year for leniolisib into the market. And we're very active at the in-licensing acquisition of additional late-stage assets in rare or ultrarare diseases. Our business development group has continued discussions with several candidates in various stages of development of those discussions. Next slide, please. And that brings us then to the current pipeline of the company. As you can see here, RUCONEST, of course, is the [ firstest ] in the market, followed by leniolisib that we expect to be able to launch by the end of next year and then, of course, followed by the further developments of the recombinant C1 esterase inhibitor off a glucose base. And of course, at the bottom, the HAE gene therapy that we in-licensed recently from Orchard. Now let's take a look at the hereditary angioedema market that is driving all the revenues for the company at this point in time. Next slide, please. And here, of course, if you see this picture, we're looking at a disease that is caused by deficiency of C1 inhibitor. And that results in attacks of severe swelling, unpredictable attacks, angioedema, in various parts of the bodies. So we're providing the only recombinant version of the C1 esterase inhibitor protein that is serving as protein replacement therapy. And RUCONEST is used for the treatment of acute attacks, but there's also compounds in the market that prevent the attacks. Now the preventative therapies have -- all have breakthrough attacks to different degrees. So it means that all the patients that are suffering from hereditary angioedema will have access to multiple medications. If they are on prophylactic therapies, they will have to have rescue therapy at hand for their unpredictable breakthrough attacks that come through in varying frequencies. So therefore, RUCONEST plays a role, not only on the right-hand side of the segment where we serve severe patients that have frequent attacks with high dose -- with RUCONEST as a high-dose protein replacement therapy, but also we serve the left-hand side of the market, the breakthrough attacks segment. Because despite the fact that there is a lot of innovation has taken place and breakthrough attack frequency have significantly reduced for patients, which is very good news, there's still a significant need and an increasing need for the use of RUCONEST in the segment of breakthrough attacks. And that is exactly what we see happening.Our traditional segment was serving the right-hand side of the market for all sorts of historical reasons. And the left-hand side, the breakthrough attacks is a segment where we see increasingly patients coming into -- our patient group that are using RUCONEST. Of course, they use RUCONEST a lot less frequently because they have -- they only have uses for breakthrough attacks, but there's definitely a good position for RUCONEST to be achieved in this breakthrough attack segment going forward. So we're very confident that the positive trend that we have seen starting with RUCONEST, that is actually the result of increasing numbers of patients and increasing demand to be continued in the coming year. Of course, subject to further breakouts of corona, where basically the medical practices will close again because that has really been the hindering of the sales in the beginning of the year. So next slide, please. And then I'll move on to leniolisib briefly for the treatment of APDS. APDS is a rare -- ultra-rare primary immune deficiency that is caused by a dominant variation in 1 of the 2 genes where that actually results in hyperactivation of phosphoinositide 3-kinase. It is an enzyme. And that results in not good -- not functioning immune system in these patients. It means that these patients have a nonfunctioning B-cell compartment and cannot defend themselves against infections. And therefore, the only way to treat this is symptomatic for this so far. And therefore, this is a disease that actually needs a treatment that treats the root cause. That's exactly what leniolisib does. Leniolisib brings back the PI3 kinase delta to normal expression and, therefore, actually can make a real impact on this disease. And the good news is this diagnosis can be made by commercially available genetic tests. And all these patients are already treated by immunologists because they form this part of the population -- patient population that's called primary immune deficiencies that is treated symptomatically by these immunologists and are actually waiting for their disease to be formally discovered and confirmed, and there could be a treatment of leniolisib in the future for them. Let's look at the disease a little bit more in detail. Please, next slide. And you see there that the burden of APDS is very significant. There's about 1,350 patients estimated to be available in the world. We haven't discovered them all yet at all. And there is -- and as you can see on this slide, they spend years sometimes to be undiagnosed or misdiagnosed and they spend a life of seeing specialists in their childhood and developed from the left-hand side from severe infection to permanent lung damage and GI disease, swollen organs, autoimmunity and a very high frequency of fatal lymphomas. So it's a very nasty disease where there's only symptomatic treatments available or treatments with very severe side effects that still treat -- only treat the symptoms. So the possibility for leniolisib to bring, actually, a way to treat this disease at the root cause is a very unique one, I would say. Next slide, please. And because the leniolisib launch is coming nearer, we started investing significantly in uncovering APDS. So we're looking at a targeted patient identification strategy that is actually kicked off in the U.S. and will be rolled out across Europe as well. And you can see here, we've built an APDS network, a KOL network and referral pathway of prescribers that are actively supported by field medical and diagnostic liaisons from our company that we started to work recently on this. We use analytics and artificial intelligence to look at the databases and patients -- the patient group that these immunologists have and then we have an outreach and education, and we offer free-of-charge genetic testing to confirm the disease and then in the future offer -- be able to offer these patients treatment for leniolisib. So this is an important step for our company to start the premarketing activities for leniolisib because leniolisib is a good year -- is only 1.5 years away, potentially, from the market. That brings me to the next slides. And there, of course, as I stated before, we were quite busy as well because we were able to finally start the acute kidney injury study for recombinant C1 esterase inhibitor. We're going to study up to 220 patients. The lead is in the University Hospital of Basel, Switzerland, with several other centers involved there. And it is actually quite a severe complication of patients undergoing these contrast procedures following their myocardial infarction where they get, for instance, stents implanted. Unfortunately, the clinical trial for preeclampsia is still out due to COVID-19 complications, but we hope that this study may, in the future start, again. And then, of course, last but not least, we're still working, of course, on the clinical trials for patients hospitalized with COVID-19, 2 studies. There's a multinational study that's investigator-led in Switzerland, Brazil and Mexico, and there is our own study that we started in the U.S., in New Jersey. And in both studies, we -- in 1 study, we look up to 150; another, up to 120 patients. Those are adaptive designs. So we are free to do interim analysis in these things, and we expect that towards the end of this quarter, we actually can come with some updates on results or signal that we see from these studies and with some further thoughts or ideas how we could actually follow on, on these studies.And that brings me then to the last slide of my part of the presentation. Next slide, please. And that is, of course, we're very excited. And technically speaking, this is one day after the period we're talking about today, the deal was closed on the first of July. So we're very pleased that we got a collaboration with Orchard Therapeutics to develop this ex vivo autologous hematopoietic stem cell therapy for hereditary angioedema. And OTL has already shown gene expression via the lentiviral-mediated transduction, ex vivo, in multiple cell lines. And of course, also already achieved the production of functional C1 inhibitor, as measured by -- through a clinically-validated assay. So this is a real program. Work is in progress. Preclinical -- further preclinical work is ongoing with Orchard and Pharming. And we think that this collaboration, with their expertise and their validated gene cell therapy -- gene therapy platform, which has already yielded an approved product, and our expertise in hereditary angioedema are a very good combination to bring a potential cure to the market for the hereditary angioedema patients. So without further ado, I would like to now hand over to Jeroen, our CFO, to take you through the financial highlights for the first half of this year. Next slide, please.

[Jeroen Wakkerman, Chief Financial Officer]

Yes. Thank you very much, Sijmen. As you will remember, the -- we saw in Q1 2021, the U.S. health care economy significantly affected by the second wave of COVID-19 and that also had an impact on our results in Q1. We saw a turnaround though in Q2, where doctors' offices reopened and patients appointments initiated, basically, a recovery across the pharmaceutical sector and also for our own RUCONEST sales. So the start of the RUCONEST recovery in the U.K. during Q2 was driven by an increase in new patients because of these doctor appointments and product demand. Looking at the revenues. In the first half, they went from $97.8 million last year to $93.2 million. And important to note is that in Q2, we saw a strong recovery. Revenues increased by 15% compared to Q2 last year, and by 14% comparing it to Q1 this year. So by all means, a good Q2 in 2021. Looking at the split, the regional split. The U.S. increased by 16% in the quarter and the sales revenues in Europe and the rest of the world decreased from $2 million -- almost $2 million to $1.2 million, but that was mainly a result of phasing of ordering. Next slide, please. Looking at the gross profit, that developed roughly in line with the revenue development. In fact, the gross margin improved slightly in the first half of the year. And the operating profit decreased in the first half of the year and also in Q2. And the reasons for that is that our operating cost increased from $52 million to $68 million in the first half of the year, so an increase of $16 million. And why was that? Well, we continue to invest in the future growth of Pharming. And if you look at the details on the slide, you can see that it was a combination of increased R&D expenditure, almost $7 million additional spend on R&D. We invested in the launch preparation and manufacturing costs for leniolisib that Sijmen just referred to, to be launched end of next year. We invested in more employees. So the additional cost was from additional employees this year, but also, of course, the financial effect from additional employees in the second half of 2020. And other cost decreases were the cost of insurances maybe that is liability insurances, an increase in share-based compensation and also increased cost in compliance and control. And the latter is also a consequence of the NASDAQ listing that we got at the end of last year. Obviously, the requirements in U.S. are very strict. We are going to be under the Sarbanes–Oxley Act and therefore, we need to prepare for that, and we are investing in that.So again, operating profit went down largely driven by an increase in operating costs, and that is a result of a decision to invest in the future of -- future growth of the business. The net profit for the first half of the year came to $14.4 million versus $20 million -- $20.3 million last year, and that is obviously because of the lower operating profit that I've just talked about, but it was also offset by positive currency results and lower funding costs. I'll tell you more about that later. Then the cash and the cash equivalents went from $206.7 million at the end of 2020 to $189.8 million by the end of the quarter. And that was driven by mainly the positive cash flow from operations, reduced by investments in CapEx and by a $25 million milestone payment to Bausch Health. And that was the last payment due related to the reacquisition of our RUCONEST commercial rights in the U.S., and that deal was done in 2016.If we go to the next slide on the income statement. You see the detailed numbers here. I won't go into detail for all of the numbers. Basically, I've just explained what happens. Things I didn't cover is the other income went up. That is mainly because of an increase in research grants because we invested more in research. You see again the increase in operating cost, and that is mainly from an increase in R&D costs. On the lines below the operating profit, you see the other financial income went up quite a lot, and that is the currency results. And on the other finance expenses was a sharp decrease in the cost, and that was because last year, we settled the OrbiMed funding, the OrbiMed loan and that came with some settlement costs, one-off costs that we obviously do not have in 2021. Basic earnings per share, $0.022; and diluted earnings per share, $0.019 per share. Moving to the next slide with the balance sheet. Key changes on the balance sheet, you will see is the right-of-use of assets. And you can see the slide, and that is related to -- it went up from $9.4 million to $22 million in the right-of-use of assets. And that is related to leases, accounted for in IFRS 16. We entered into a new lease expansion -- relative expansion of a production site and also extension of existing leases. Obviously, the liability effect you will see later on as well. So yes. Then the other point is the deferred tax asset went down, and that was because it was used against the current taxes. And at the bottom, you see, again, the cash and cash equivalents that I've just explained this reduction. On the liability side of the balance sheet, on the next slide, please. The shareholders' equity went up largely because the profit that we made in the first half year. You see these liabilities go up, as I've just explained, related to IFRS 16. And at the bottom, you see in other financial liabilities that at the end of last year, we still had the $25 million liability to Bausch, and that is now paid off. Moving to the cash flow statement. Profit -- so on the next slide, please. The profit before tax, $20 million against -- almost $29 million in the first half of 2020. And the net cash flow generated from operating activities went from 50 -- sorry, $44.9 million to $16.4 million. So that's a reduction of $28.5 million. Now what has caused this reduction in operating cash flow? So the $28.5 million, I can split it into 3 parts: the first one is a reduction in operating profit, as I said, mainly because of an increase in operating expenses; second part is less cash inflow or more cash outflow from working capital than we had last year; and then there is a plus of $3 million in other operating cash flow elements. Going down on the cash flow statement, we see, again, the Bausch payment, $25 million under the payment on contingent consideration. So overall, we increased the cash by $16 million. Obviously, the -- last year, we increased the cash by $95 million, but that was because of the issue of the convertible bonds less than from operational cash flow. With that, I would like to hand over again to Sijmen.

[Sijmen de Vries, President, CEO & Executive Director]

Thank you very much, Jeroen. And please, next slide. So if I look at the investment summary here, we're a well-funded business. We're supported by commercial sales and a growing pipeline for the treatment of rare diseases and unmet medical needs. We're funded, really, as you heard from Jeroen, by the sales of RUCONEST and we brought in another $93 million of sales in the first half of this year. We have a potential near-term inflection point with the 2022 launch of leniolisib for APDS. We're treating -- we're targeting new large indications for recombinant C1 esterase inhibitor with Phase II studies. We also strengthened our early-stage pipeline with the in-licensed potentially curative gene therapy treatment for HAE and we have our own transgenic platform candidate for our Pompe disease in the pipeline. And we're able to leverage commercial infrastructure for in-licensed products and expanding manufacturing capacity to support the continuous RUCONEST demand and C1 inhibitor pipeline. And last but not least, we have an experienced leadership team and Board and a very strong balance sheet, both in terms of cash-generative potential; and of course, the cash that we have on hand to support our ambitious growth strategy, including potential M&A. And of course, we have this secondary listing on the NASDAQ to be able to finance such transactions in the future, and we're very keen on this, and we're very focused on getting another transaction with a late-stage asset in.Now next slide, please. Last slide. I would share with you the outlook for the remainder of 2021. So for the remainder, we expect a continued increase in revenues from the sales of RUCONEST because the pharmaceutical market looks to be normalized, continue to normalize further and return, hopefully, to it's pre-COVID-19 state although we will continue to monitor the situation and continue to expect some periodic market disruptions. We, however, are maintaining positive earnings during the year. And as Jeroen's explaining, we will continue to invest in the expansion of production facilities for RUCONEST and leniolisib and the launch portfolio critical medical affairs and premarketing activities for leniolisib and the registration-enabling study for APDS as well as the ongoing clinical trials and other development activities, including OTL-105. And last but not least, we will look to invest in acquisitions and in-licensing of new development opportunities that are near term to the market so we can launch additional products very rapidly beyond leniolisib. And we provide no further specific guidance for 2021. So this completes our presentation. I would now -- like now to hand over back to the operator for any questions that you may have that we can answer. Thank you.

[Operator]

[Operator Instructions] We have a question from Joe Pantginis from Wainwright.

[Joseph Pantginis]

Nice to see the first half results. So a couple -- I guess my questions are based on essentially blocking and tackling of the underlying business. So first, can you give us any sort of visibility as to potential next EU territories that might be coming online, obviously, since you've mentioned for quite some time now that the different regulatory structures there are -- the rate limiting factor?

[Sijmen de Vries, President, CEO & Executive Director]

Yes. Yes, Joe. Spain now, we -- after a long period, we got reimbursement. We're working on Italy as well to get reimbursement. And we're looking at some of the smaller markets as well. I think North Macedonia and Ireland are territories that come to mind, but we are also looking to get reimbursement there. It's not necessarily the regulatory activities because there are therapies, of course, approved by EMA as it does by FDA. But in Europe, there is market access hurdles that, in some cases, are tremendous and take a long, long time. And that's what you're looking at here, and that's what you're looking at in markets like Spain and Italy and the markets I just mentioned as well.

[Joseph Pantginis]

Sure. No, that makes sense. Yes. Sorry.

[Sijmen de Vries, President, CEO & Executive Director]

No. No worries.

[Joseph Pantginis]

Okay. So -- and then just curious, because as the business continues to expand, and we'll just ignore COVID right now, that would be great. How are your manufacturing initiatives going? What do you consider to be any rate-limiting steps? And then I guess I will bring COVID back for my last question about do you have any potential projected time lines with regard to the COVID data?

[Sijmen de Vries, President, CEO & Executive Director]

Yes, yes. So the first one, we're executing on the manufacturing expansion strategy, the third facility to produce milk is now nearing its completion. So we'll soon be populated with rabbits. And from there on, of course, we will have to generate products from that facility and process the product all through the finished product and show that to the regulators that we make exactly the same product, which we have done before, of course. So that should not be an issue, but it takes time. But it is in progress and planned. We're working on the DSP facility, the purification plant, according to plan, which, of course, in a couple of years, will come online as well. So we're really in-sourcing the manufacturing process into the company, and we're executing against it according to plan. With regards to the COVID results, we do expect that we could look for some interim analysis results by the end of Q3, also because our recruitment has significantly slowed down in these studies by now, and that's a good sign, of course, because we want -- we all want to go back to normality. And I think that's what you should be looking at. Towards the end of the quarter, I would say, we will be coming with some updates on that and some potential next steps following these 2 studies. And of course, you were mentioning it. COVID is, by far -- normally, I mean, 50% of the doctors' practices in the U.S. are still not interacting live with pharmaceutical companies. So we're still suffering from this inability to have face-to-face contact, which, of course, is very important when you're dealing with rare diseases, with patients transferring from one to another product in a rare disease situation, where you have to go to incredible, big administrative hurdles. And of course, I can fully understand that even when these doctors' offices are open, that may not be their first priority. So that's really an ongoing challenge, but we see things turning slowly back to normality in the U.S., and therefore, we're optimistic for the rest of the year that the increase in revenues that we see should continue for the remainder of the year. Okay?

[Operator]

We have another question from Alex Cogut from Kempen.

[Alexandru Cogut, Co]

I have a couple on RUCONEST and on the pipeline. So on RUCONEST, thanks for kind of describing the dynamics in patients and where you see RUCONEST filling in. But I would just like to understand a little bit better what's actually happening with volume. Because assuming patients are -- you're getting new patients -- are using RUCONEST mostly to treat breakthrough attacks but losing patients that were using it kind of prophylactically off-label. Aren't you overall experiencing then lower volume of drug?

[Sijmen de Vries, President, CEO & Executive Director]

Well, not -- yes, sometimes we do, sometimes we don't. It's very difficult, Alex. You're right, there is a mechanism like that. There's also a mechanism that we see that there is a certain saturation point now reached of patients switching over to these new prophylactic therapies. That's at least what we talk to KOLs, what they tell us. And that means that indeed, you have to replace if you have a severely affected patient and they go on prophylaxis, they often mostly continue to use RUCONEST but on a lower frequency, that's correct. And if you replace them with patients that are using RUCONEST for breakthrough attacks, you need to replace them with more patients, that is correct. But the good news is, it is happening. And the good news is that you can see that we're recovering the sales from where we were really hit by COVID to more normal levels, and we remain optimistic going forward.The challenge here in addition to that, of course, is face-to-face contact with these doctors because it is -- as I already was saying, it's an extensive administrative hurdle to do this. And our experts, internal experts are helping those doctors' practices jumping through all these hoops. And sometimes, these hoops are very significant before patients actually get their commercial -- their first delivery of product. However, when patients subscribe to RUCONEST solutions, they get a bridging medication until such time that they are reimbursed. So that's that is basically the mechanics that are ongoing in the market. And we see -- we remain optimistic about the future prospects of RUCONEST in this respect. It certainly has its place and will continue to have its place in this market with this very unpredictable disease.

[Alexandru Cogut, Co]

Got it. And just to clarify, do you have visibility into, let's say, to the volumes per patient, let's say, over the last first half?

[Sijmen de Vries, President, CEO & Executive Director]

Yes. We do have insights in that. It's, of course, all anonymized data. But it is because it's -- we're working with these specialty pharmacies. We know the patient journeys, and we support patients as well, of course, because these patients are often very much in need of support in all sorts of ways, and we do support them in all sorts of ways. So yes, we're very close to our patients.

[Alexandru Cogut, Co]

Okay. Got it. And I think on -- just a question on your qualitative guidance. When you say increased continued growth in sales, do you mean year-over-year or quarter-over-quarter? How should we think about that?

[Sijmen de Vries, President, CEO & Executive Director]

That's always a very nice question, of course. I would say that we start with that we increase quarter-on-quarter. I can't speculate on that will be -- that the sales will be higher as last year because that is certainly very much dependent on how quickly situation turn to normal. And as you know, all pharmaceutical companies are suffering from this issue that a lot of the care is not being delivered and they suffer from lower revenues because care focused on COVID takes away resources from care that we given -- that is given otherwise. And I think we're in the same boat here. So it really depends on the situation returning to normality. And you know what? Last year, we lost sales that we didn't get back because our growth was lower than we expected. On the other hand, we got a lot more sales in the end of the year, especially the fourth quarter, that we weren't expecting and which turned out to be a certain amount of hoarding by patients because of that tremendous COVID wave that hit the United States at the end of last year, and that was not foreseen and you saw the drawback of that. So it's very difficult to predict that in these kind of circumstances. But I think it's -- generally, you see a general trend of that happening in the pharmaceutical markets. So we're no exception there.

[Alexandru Cogut, Co]

Okay. Understood. That's very clear. And just 2 more on the pipeline. So when do you expect to report the leniolisib results then?

[Sijmen de Vries, President, CEO & Executive Director]

That's a study that's done by Novartis. So it's either the end of the year or the beginning of '22 -- of next year that this comes out, that the final report is coming out. And we're aiming to bring in the results very quickly to the FDA and EMA, and we're aiming for a PDUFA date in Q4 of '22. So you can see that it should be somewhere in the beginning of the year or maybe even towards the end of the year, that's very difficult to predict. As I said, it's in the hand of Novartis, the details here.

[Alexandru Cogut, Co]

Got it. And on OTL-105, when do you expect to enter the clinic?

[Sijmen de Vries, President, CEO & Executive Director]

Yes, that's an interesting question. We're doing a lot of preclinical work now. Now with gene therapy, as you know, your clinical pathway is slightly different because you don't do healthy volunteers. So you go straight into patients here. So we expect somewhat longer preclinical trajectory. And I would like to reserve the answer on that until we have some more insights in that, and we will come out with some more time lines. But it will, of course, be a few years from now before we go into the clinic, but then with a shorter and typical clinical development program because it's gene therapy. Okay?

[Operator]

We have another question from Christian Glennie from Stifel.

[Christian Glennie, Analyst]

Follow-up then on leniolisib. Firstly, on -- in terms of who's responsible for the regulatory filing, is that down to Novartis or you guys? And then just on the -- I think about the test and that collaboration, have you started that yet? Is there any information that's come out of that might inform sort of diagnosis rates? You say, obviously, there's a patient population out there. But it's hard to find them and get the diagnosis, right? So is there anything to come out of that particular initiative as yet?

[Sijmen de Vries, President, CEO & Executive Director]

Yes. Okay. So first off, we do the regulatory filing for the product. And then with regards to that, that APDS testing program with Invitae, navigateAPDS, that's just started as announced earlier. And we have patients in the market now visiting those immunologist -- immunology practices and going through those patients and defining the most likely symptom combinations for APDS and educating those immunologists on that, and then they offer the genetic testing. And that is actually ongoing. So we have had a number of these tests already being commissioned. We also have a patient registry in Europe, and we're building a patient registry in the U.S. And we have, of course, patients identified there. So we start, in all earnest, to build that registry and to build relationships in the community and with the patient organization. There's no specific APDS patient organization. There is, of course, for these primary immune deficiencies, there are several patient's organizations where we are collaborating together with. And there's a very high motivation of these patients to actually collaborate with us because, of course, if you have a primary immune deficiency and you happen to have APDS, in this case, you're lucky because you could get some therapy into the future. So there's -- they are very motivated to work with us. So we look forward to that continuing. And of course, in due time, we will inform about where this is going.

[Christian Glennie, Analyst]

Do you have a rough sort of number at this point or any insight into what the diagnosis rate is at the moment for this condition?

[Sijmen de Vries, President, CEO & Executive Director]

Yes, there are several hundreds of patients already diagnosed for the disease. That's definitely -- we're not starting from scratch at all. We estimate -- according to the estimated prevalence, that there could be about 1,350 patients in the main markets. And there's a couple of hundred already identified on both sides of the ocean. So we're not starting from scratch at all. Okay?

[Christian Glennie, Analyst]

Okay. Okay. And then just turning to the AKI trial that's underway, looking to recruit 200-odd patients. Anything to say in terms of recruitment so far in that trial and potential timings of data?

[Sijmen de Vries, President, CEO & Executive Director]

I would say that -- I think earlier we said that towards the end of next year, second half next year, we expect to be able to complete that trial. For now, I would like to stick with that. We're trying to accelerate this study. And again, we will, of course, inform the market when we finish the recruitment, as per usual. I think we should wait for that.

[Christian Glennie, Analyst]

Okay. And then it's worth always asking. Your key part -- one of the key strategies on business development, something in terms of adding new products in to the platform. Can you characterize anything versus what you've made -- said last time in terms of how that -- what level of discussions are happening and expectations?

[Sijmen de Vries, President, CEO & Executive Director]

Yes. We have a very active business development group and we are interacting with several potential targets or partners at the same time. And these discussions sometimes go very far and sometimes we stop very early. So there's a continuous activity going on. But as you know, business development is a real numbers game. And we, of course, are quite precise about the opportunities we're looking for. We're looking for compounds that are in a rare or ultrarare space because the development is overseeable. We're looking for compounds that are sort of within the window of 3 years from now to be able to launch. So we have a rapid succession of launches following the leniolisib launch. And yes, it has to be, of course -- we have to be convinced about the data. And then, of course, last but not least, the other party will have the dance as well. And that is, of course, it takes 2. So all in all, we're working very hard on this, and we're quite keen and we have continuous discussions. But as you know, business development is all or nothing. Until you have a deal, you don't have anything. And that's -- we're no exception here, I'm afraid.

[Operator]

We do not have any more further questions at this stage. I'm going to pass it back to Sijmen.

[Sijmen de Vries, President, CEO & Executive Director]

Thank you Thank you very much, and thank you very much, ladies and gentlemen. I would like to remind you that we are optimistic about the rest of the year. We are a well-funded business. We have our own commercial sales. We have a near-term inflection point. And we're looking at large indications for our lead compound. We are -- we have recently added a very interesting gene therapy to our long-term pipeline. And we're looking forward to meet you again with our next results conference. Thank you very much for your attendance. Goodbye.