Genmab A/S
CSE:GMAB
If you don’t study any companies, you have the same success buying stocks as you do in a poker game if you bet without looking at your cards.
Utilize notes to systematically review your investment decisions. By reflecting on past outcomes, you can discern effective strategies and identify those that underperformed. This continuous feedback loop enables you to adapt and refine your approach, optimizing for future success.
Each note serves as a learning point, offering insights into your decision-making processes. Over time, you'll accumulate a personalized database of knowledge, enhancing your ability to make informed decisions quickly and effectively.
With a comprehensive record of your investment history at your fingertips, you can compare current opportunities against past experiences. This not only bolsters your confidence but also ensures that each decision is grounded in a well-documented rationale.
Do you really want to delete this note?
This action cannot be undone.
| 52 Week Range |
1 445
2 252
|
| Price Target |
|
We'll email you a reminder when the closing price reaches DKK.
Choose the stock you wish to monitor with a price alert.
This alert will be permanently deleted.
Genmab A/S
You don't have any saved screeners yet
Good afternoon, ladies and gentlemen, and thank you for standing by. Welcome to today's Q1 report 2019. [Operator Instructions] I must advise you that this conference is being recorded today, Wednesday, the 8th of May 2019.During the telephone conference, you may be presented with forward-looking statements that include words such as believes, anticipates, plans or expects. Actual results may differ materially, for example, as a result of delayed or unsuccessful development projects. Genmab is not under any obligation to update statements regarding the future nor to confirm such statements in relation to actual results, unless it is required by law. Please also note that Genmab may hold your personal data as indicated by you as part of our investor relations outreach activities in order to update you on Genmab going forward. Please refer to our website for more information on Genmab and our privacy policy.I would now like to hand the conference over to your first speaker today, Jan van de Winkel. Please go ahead, sir.
Hello, and welcome to the Genmab conference call to discuss the company's financial results for the quarter ended March 31, 2019. Our CFO, David Eatwell is joining me on today's call.Let's move to Slide 2. As already said, we will be making forward-looking statements, so please keep that in mind as we go through this call.Let's move to Slide 3. I'm very pleased with the progress Genmab has already made this year. The progress of the DARZALEX program has continued to be excellent. DARZALEX received approval for a split dosing regimen in multiple myeloma from the U.S. FDA, adding to the similar approval in the EU at the end of last year. Our collaboration partner, Janssen, has also submitted regulatory applications in both the U.S. and in Europe for frontline multiple myeloma in combination with various standard therapies based on the positive data we reported end of last year in the Phase III MAIA and CASSIOPEIA studies. A regulatory application based on the MAIA study was also submitted in Japan in April. We look forward to seeing regulatory decisions on these applications this year.We also reported positive top line data from the Phase III COLUMBA study, which compares the subcutaneous and intravenous formulations of daratumumab in relapse or refractory multiple myeloma. The study met its primary endpoints and shows that the subcutaneous formulation is noninferior to the IV formulation. The overall response rate for patients treated with the subcutaneous daratumumab formulation was 41.1% versus 37.1% for the IV formulation. Janssen plans to discuss potential marketing applications with the regulatory authorities based on this data. If successful, patients with multiple myeloma could benefit from a much shorter treatment time and a much more convenient route of administration.As we mentioned during the Q4 results call, we were also very pleased to have prevailed in the patent litigation relating to DARZALEX, which was brought against us and Janssen by MorphoSys. The case was closed in January when MorphoSys agreed not to appeal to summary judgment of invalidity of all of their 3 CD38 patents. And Genmab and Janssen agreed not to pursue our inequitable conduct claim.Lastly, for DARZALEX, we reported USD 629 million in net sales by Janssen during the first quarter, an increase of 46% over Q1 last year, resulting in DKK 502 million in royalties. We also continue to advance our proprietary programs during the first quarter. We completed patient enrollment in the Phase II innovaTV 204 study of tisotumab vedotin in recurrent and/or metastatic cervical cancer as well as dosed the first patients in the Phase I/II innovaTV 205 study and started the first clinical study with tisotumab vedotin in Japan. We're also making progress on our goal to submit 3 INDs or CTAs this year, already having filed CTAs for the DuoBody-CD40x4-1BB and the DuoBody-PD-L1x4-1BB programs. We're looking forward to getting the first clinical studies for these programs underway shortly.I will now turn the call over to David to present our financial results for the first quarter of 2019. David?
Thank you very much, Jan. Over the next few slides, I'll go through the results for the first quarter of 2019 as well as remind you on the financial guidance for the full year.Starting with the income statement. The revenue for the period came in at DKK 591 million. That was a decrease of DKK 90 million or 13% compared to the first quarter of 2018. The decrease was primarily driven by the Arzerra onetime payment of $50 million or around DKK 304 million in the first quarter of 2018. And that was partially offset by the higher DARZALEX royalties driven by the year-on-year increase in DARZALEX sales of 46%.The total expenses for the first quarter of 2019 were DKK 617 million, an increase of DKK 260 million or 73%. And that was driven by the advancement of our clinical products, including tisotumab vedotin and enapotamab vedotin, as well as our other pipeline products and our new CTAs. We also increased the number of employees to support our pipeline expansion.For our operating result, as anticipated, we had an operating loss of DKK 26 million for the first quarter of 2019. And that compared to an operating income of DKK 324 million in the same period in 2018. The decrease of DKK 350 million or 108% was driven by the one-off Novartis payment in Q1 2018 as well as the higher operating expenses.The net financial items were a net income of DKK 120 million in Q1 2019 compared to a net loss of DKK 68 million in the first quarter of last year. The main driver for the variance was again the foreign currency movements between the 2 periods. And this year, that positively impacted our U.S. dollar-denominated portfolio and cash holdings.The corporation tax expense for the first quarter of 2019 was DKK 22 million compared to DKK 57 million in the same period for 2018. The estimated annual effective corporation tax rate in the first quarter was 23% compared to 22% in the first quarter last year.So that brings us to the net result, which was positive in both periods with a net income of DKK 72 million for Q1 2019 compared to a net income of DKK 199 million in the same period for 2018, a decrease of DKK 127 million or 64%.Now I'd like to move on to Slide 5 and the revenue. The revenue breakdown by category is shown on the left-hand side of this slide. In the first quarter of '19, royalties were the largest portion of the revenue at DKK 508 million compared to DKK 318 million in 2018. The increase of DKK 190 million was driven by the higher DARZALEX royalties, which were partially offset by the lower Arzerra royalties.There were no license fees in the first quarter of 2019 compared to DKK 304 million in the first quarter of '18. And as already mentioned, that decrease was driven by the one-off payment from Novartis in Q1 last year, and that was relating to the amendment of the Arzerra ofatumumab license and collaboration agreement. Reimbursement income accounted for DKK 83 million in the first quarter of this year compared to DKK 59 million in Q1 2018, an increase of DKK 24 million.The graph on the right bridges the revenue between the 2 periods, and the largest decrease again was the Arzerra payment from Novartis. This was partially offset by DARZALEX royalties, which grew from DKK 310 million in Q1 last year to DKK 502 million in the same period of 2019, an increase of DKK 192 million. The royalties were based on Janssen's DARZALEX net sales of $629 million in Q1 this year compared to $432 million last year. The substantial increase in sales of $197 million or 46% was driven by the continued strong uptake in the U.S., EU and Japan. The cost reimbursement increase was primarily driven by the advancement of the collaboration products both with Seattle Genetics and BioNTech.Next, the expenses and the operating income on Slide 6. The change in expenses between the first quarter of '18 and '19 is aligned with our strategic focus to achieve our 2025 vision, and you can see the growth drivers in the graph on the left. There was an increase in the operating expenses of DKK 260 million, which was driven by the accelerated investment in our clinical and preclinical portfolio. In fact, 60% of the total expense increase was due to the additional investment in our product pipeline, including the advancement of tisotumab vedotin, enapotamab vedotin and advancing our new programs towards the clinic this year.FTE costs have also increased year-over-year as we continue to undergo strategic controlled growth to support our robust pipeline and continue efforts to build our commercial capabilities. We had 419 FTEs at the end of the first quarter, which is an increase of 50% from Q1 2018.Looking at the chart on the right, you can see a decrease in the operating result, with an operating income going from DKK 324 million to an operating loss of DKK 26 million. And for the last time, again, that is due to the Novartis one-off payment as well as the greater investment in our pipeline.Now let's move on to the guidance for 2019. On Slide 7, we are maintaining our financial guidance, which was initially published on February 20 of this year. Starting at the top of the Slide 7, we expect our 2019 revenue to be around DKK 4.6 billion, our operating expense to be about DKK 2.6 billion and that will result in an operating income of about DKK 2 billion.Now if we take a closer look at the key elements of the revenue at the bottom of Slide 7, our projected revenue consist of DARZALEX royalties of just under DKK 2.7 billion, and that's based on Genmab's estimate of DARZALEX net sales of $3 billion. We expect DARZALEX sales to rapidly advance in 2019 with a growth in the U.S. market share both in the frontline setting and the second-line setting where we anticipate long duration of treatment and increased number of patients on treatment.In Europe and the rest of the world, we'll also continue to see more countries come on stream and expect to see the introduction in frontline multiple myeloma with daratumumab plus VMP. As a reminder, the average royalty for the $3 billion of sales is just under 15%. And all sales above $3 billion have a royalty rate of 20%. You'll also note that in 2019, the anticipated DARZALEX royalties exceed the total expense base. We also project daratumumab milestones of DKK 1.5 billion in 2019, which mostly relates to sales-based milestones. This includes $150 million milestone for sales exceeding $3 billion in a calendar year as well as a milestone for exceeding $2.5 billion in a calendar year. So of course, we expect these milestones to be achieved towards the back end of this year. The remainder of the revenue mainly consists of cost reimbursement income related to our collaborations with Seattle Genetics and BioNTech as well as some DuoBody milestones and Arzerra royalties.Now let's go to the expense detail for the guidance on Slide 8. On the top of this slide, we show you that we're investing in 3 main areas: project investment, personnel costs and business support. And that's in line with our strategy that we've previously communicated for 2025.The largest cost at nearly 60% of the total is our project investment. This directly relates to the success and the advancement of our pipeline. The next largest cost is the personnel costs. At the end of 2018, we had 377 FTEs. And we anticipate this will increase to about 560 employees at the end of this year. Again, the increased investment, increased resources is directly driven by the success of our pipeline. The business support areas relates to all of our different support functions, and the growth is across many different areas, including enhancing technologies and systems, new areas of data science and early investment in both medical affairs and commercial functions.On the bottom of the slide, we got our most significant areas of investment, the project costs. On the left, we have our total project investment of DKK 1,475 million, and over half of this amount will be invested in our 2 most advanced products, tisotumab and enapotamab vedotin. In comparison, the next 8 projects, including the 4 early projects already in the clinic and the new products entering the clinic this year, we'll invest around DKK 500 million. So if we add those together, it's a total investment of DKK 1.3 billion on our top 10 programs, and that's consistent with 2018 where our top 10 programs account for about 50% of our total expense base. So you can see here, this is a solid investment in our future.On the right-hand side of this slide, we have a breakout of the increased FTEs of 180 employees, 73% of those relates to our R&D employees, 18% for the business support functions and 9% for the newer areas of medical affairs and commercial. Of course, we are projecting to be cash flow positive again in 2019. And our priority for capital allocation is to continue to increase the investment in our preclinical and clinical pipeline and work towards achieving our 2025 vision. Of course, as usual, the 2019 guidance does not include any new large potential deals.And now I'd like to turn the call over to Jan to update you on our 2019 goals. Jan?
Thank you, David. Let's move to Slide 9. We anticipate solid progress across all areas of development during 2019. As I already mentioned, Janssen has submitted new regulatory applications for DARZALEX in the U.S. and in Europe based on the MAIA and CASSIOPEIA studies. And we expect to receive subsequent decisions this year. We announced positive data from the Phase III COLUMBA trial, giving us more insight into safety and efficacy of the subcutaneous formulation of daratumumab in multiple myeloma and look forward to submissions to regulatory authorities.For ofatumumab, we expect data from the 2 large Phase III trials of the subcutaneous formulation in relapsing multiple sclerosis. If the data is positive, it could give ofatumumab new life as a potential treatment for relapsing MS. We are continuing to move the tisotumab vedotin program forward with the start of new studies, and we have already completed enrollment of the potentially pivotal Phase II trial in recurrent or metastatic cervical cancer. We also expect the rest of the pipeline likely to grow exponentially this year with a number of key datasets expected in the second half and filing of at least 1 more IND or CTA in addition to the CTAs already submitted for DuoBody-PD-L1x4-1BB and DuoBody-CD40x4-1BB.So now let's move to Slide 10. That ends our presentation of Genmab's Q1 2019 Financial Results. Operator, please open the call for questions.
[Operator Instructions] Your first question comes from the line of Wimal Kapadia from Bernstein.
Wimal Kapadia from Bernstein. I'm sorry to ask this again, but I'm sure it's a focus for investors. Can you just reconfirm a few points for the 2019 dollar sales guidance? So what revenue contribution have you assumed from MAIA in the U.S. for the year? And when do you assume that those revenues begin? And then second part to the question is that, and this is more just a curiosity, but is there any chance that, that product is not approved via the RTOR pathway? I'm not sure of the technicalities, but maybe you can help here. Does the FDA have to approve the product via RTOR?
Thanks, Wimal, for the actually 2 questions, and I will delegate the first one clearly to David. But let me move to the second part of the question, the RTOR and the chance of it not being approved on the RTOR. I would say no. The process is going very well, as I understand from Janssen. And we expect an approval on the RTOR imminently. And that's the same, Wimal, as I said 4 weeks ago. So that was also expected imminently. It's up to the gods at the FDA right now, but I think the process is going well, and there is no reason to be concerned at all. It's an experimental program. It's a pilot program. So the time lines are not fixed, but we expect it very, very shortly.David, maybe you can handle the first part of Wimal's question.
Yes. Happy to do so, Jan. Just as a reminder for everybody in terms of what we're expecting for sales growth, as a reminder, in 2018, we had $1.2 billion of U.S. sales, $800 million of rest of world for a rounded number of around USD 2 billion of DARZALEX sales in 2018. We're looking for $3 billion as you know for 2019. And we expect that growth to be roughly split evenly between the 2 regions, $500 million U.S., $500 million rest of world to a total growth of $1 billion or 50%. That means with a higher U.S. starting point for the U.S., we're looking for a 42% growth U.S., 62% rest of world.Now in terms of the growth that we anticipate for the U.S., $500 million. I would anticipate that may -- or frontline multiple myeloma would contribute approximately half to that. So somewhere in the $200 million to $250 million coming from the frontline indication. As Jan said, we expect approval imminently, and we expect there's going to be quite demand for that product. And we would expect the sales to pick up quite quickly.One other final point on that, remember that dosing for DARZALEX is that you start off with weekly dosing then go to bi-weekly and then on to your once every 4 weeks. So it does mean you do get that sort of hockey stick on the start of the sales where you get that nice, extra sales per patient certainly for the first 6 months compared to the ongoing period. So we still remain confident around our $3 billion for the year.
Great. Can I just ask for a bit of clarity? When do you assume those revenues start to contribute?
I think they'll start to contribute very, very quickly after the anticipated approval.
Your next question comes from the line of Thomas Bowers from Danske Bank.
I'll ask my one question here. So just on tisotumab 204. Well, Keytruda was approved last year with a sort of mediocre overall response rate and then 6 months duration. So I'm just curious, is this sort of the same criteria you expect to be the threshold for the FDA? And also, do you see any impact on that approval last year in the treatment landscape in second line? And do you see any of the last patients you have recruited to actually be affected by or have been treated with Keytruda at some point?
Thanks, Thomas, for the question. We have, of course, noted and studied the Keytruda data very carefully. I think we have to hit a similar criteria. We have not given you the threshold for the overall response that we have agreed with the FDA. But I can tell you that we definitely need to follow up the responders for at least 6 months. So we expect the data -- since we now recruited all the over 100 patients now by the end of March, we expect the data basically early next year. So probably in the Q1 next year is where we anticipate the top line data. And what I understand is that we have not been seeing any impact from the second-line Keytruda treatment. So the recruitment was actually very, very fast. And yes, we're very enthusiastic about the program. As I said, we're already expanding it at all levels. We're going to expand it further in the coming time. And we continue to be encouraged by what we see. And in the second half of this year, we'll likely also see data in other cancers, Thomas.
Next one comes from the line of Sachin Jain from Bank of America.
Sachin Jain with Bank of America. Can I take a clarification to Wimal's earlier question? You said discussions are going very well, but I guess it's taken a little bit longer than we had anticipated. So do you have any color on what the holdup with the regulator is that you're able to give or where the sort of sticking points are?And then my question was just, as you approach the Phase I data for DR5 and the CD3xCD20 and other Phase I assets, Jan, maybe just remind us on how you're thinking about potentially partnering of these products? Now you've talked about it at a high level before, will you just update us on your thoughts there?
Thanks, Sachin, for the questions. I can't give you much more color on the approval process based on the MAIA data apart from that is going very well according to our colleagues at Janssen. And I think since there is no fixed and firm time lines, Sachin, I think we can definitely expect the approval imminently. But as I already said in answer to Wimal's question, I said the same 4 weeks ago. So I think it really can come any moment. And we are encouraged by the feedback, and there's no reason to be concerned.Then as it relates to DR5/5 HexaBody and the CD3xCD20 DuoBody programs, we're doing dose escalation for both and it's going well, I can tell you for both programs. And when we think about potentially partnering either one of these programs, I think there's a good chance that we need a partner because the market could potentially be huge for a program like the DR5/DR5 HexaBody program. It's a well-validated target preclinically, and we have seen some very encouraging signs of early activity already with only a handful of patients already reflected up at the Capital Markets Day last September. So we would definitely expect that we need a partner for that program to maximize the potential of that program if we see good signs of clinical efficacy with our HexaBody product.And the same holds actually for the CD3xCD20 bispecific program. There's considerable excitement now in the hematology field because of the Regeneron and Roche programs. Yesterday, the Regeneron program created some lesser excitement because of some fatalities apparently in one of their trials. But we have a very different molecule, which preclinically seems to be at least 100-fold more potent than the Regeneron CD3xCD20 and 2 to fourfold more potent preclinically than the best Roche program. So we have a lot of potential for that program for partnering. We think we want to see data. We expect data for the CD3xCD20 before or at the ASH meeting this year. So I think it's heating up quite well, Sachin. And I think we could potentially see partnerships for both of these programs to maximize the potential for the CD3xCD20, the very competitive hematological area. Now a little bit behind Roche and Regeneron but with a very differentiated molecule. This is given subcutaneously and preclinically. It's very, very much more potent than these other programs, and we use a different way of silencing the bispecific. So we expect potentially less side effect issues than had been seen with this earlier generation, more primitive bispecific. So yes, that's probably all I can say at this moment.
Your next question comes from the line of James Quigley from JPMorgan.
Just a follow-up on the U.S. MAIA contribution and sort of the qualitative areas behind that. So what are you hearing from the attitude of doctors in the U.S. in terms of are they sort of aware having patients ready to start on DARZALEX? So what I'm trying to get at is, is there a bolus of patients in the first line that are ready to start, which could quickly get to your $200 million to $250 million estimates for the year? Or are the doctors starting on other regimens first given the strong data that we've seen in DARZALEX in the second line? And just a very quick follow-up on Sachin's question there. CD3xCD20, you've talked about partnering before. DR5/DR5, I think, was one of those assets where you'd at least want to keep 50% of the rights, especially in the U.S. Has that changed at all?
Let me take the second question, James, and then David can think more about his answer to the first question. And maybe, Dave, you can speak about the brand impact data, the recent March data, which can give a clue already to the patients basically gearing up towards getting treated with DARZALEX.But as it relates to the CD3xCD20 and the HexaBody DR5/DR5 programs, we intend to keep at least 50% of the product ownership in our own hands also enter a partnership, James. So that didn't change at all. We have the capital and the motivation to hold on to 50% of the product rights. And I can tell you that for both programs, there's huge attention right now from pharmas and biotech companies already based on the early clinical data and on the preclinical data set. So I believe that we are in a very good position. If we think we needed to actually enter into partnerships for both of these assets and on top of that hold on to 50% ownership and we have a clear focus on doing the U.S. commercialization ourselves, depending on the market, alone or together with a muscular partner who can maximize the potential of these programs. So the good thing is that in the second half of this year, James, we expect data from both of these assets. So it's going to be a very exciting year. David, maybe answer question one from James.
Sure. Absolutely. Happy to do so. I think from the market research we've done, there's quite a lot of excitement for the doctors waiting for the approval of daratumumab plus Revlimid/Dex in the frontline setting. I think in terms of a bolus of patients waiting, I think it's probably unlikely in the U.S. that if you got a frontline patient that you would hold off treatment. I think you'd want to get that patient on treatment as soon as you can. But I think as soon as the approval comes through, the expectation from the doctors, from the market is very well known. They are waiting for the drug to come through. And I think the usage will be picked up quite quickly.We have seen what happened in the second-line setting. We have seen from experience that when a new label is introduced, it tends to be introduced to new patients that present themselves. So if you do have a patient that's stable and doing well on the current treatment, they tend to lead well alone is -- that tends to be the normal routine. But we expect with the frontline setting, as soon as the approval is there that doctors immediately use it.Now of course, we also have the advantage that the doctors are already used to using daratumumab plus Revlimid/Dex in the second-line setting. So this isn't a new indication. When we had the drug approved from the first time in the community setting particularly, you find that doctors will see how the first patient goes. Now that can be -- see how they go to get experience with a new drug or a new drug combination but also experience on how the reimbursement is working on a new drug as well. They've already got that experience with daratumumab in fourth line, third line, second line. And they've already got the experience with the combination, of course, of daratumumab/Revlimid/Dex combination. So I think we got none of those sort of learning issues to go through. And on that basis, I think we'd see the pickup coming through quite quickly.Also as a reminder, if you look at the U.S. market and the approximate split is 50% in the frontline setting, 30% in the second-line setting and then 20% of the patients in the third-line plus. So it is the largest portion of the market that we'll be looking to enter on the assumption of this new approval.Jan, did you also want me to mention the brand impact update at this stage?
I think it would be good for James to get further color on why we are so enthusiastic about a rapid uptake because you can already see that like moving in.
So I think overall brand impact is the IQVIA brand impact data. As a reminder, the data we purchase is 3 months rolling average, such it's the data for the period ending March 2019. Overall, in the second line, we continue to see the market share grow. The number for March was 29% market share. That is the new high for their reporting for DARZALEX in the second-line setting. Within the second line, we are seeing that the daratumumab/Revlimid/Dex is the most popular combination. That takes about 13 percentage points of the 29% and then followed by use of daratumumab/Pomalyst and then daratumumab/Velcade. Also in the second line, we continue to be encouraged with new patient start numbers continuing to be above the current market share, which is an indication to us that we should still see continued market share gains in the second-line setting throughout 2019.In the third-line setting, we're stable there. We've got a very large portion of the market at 48%. So that's remained about the same as the numbers we spoke of last quarter. In the third-line setting, it's the daratumumab/Pomalyst/Dex that is most popular, with about 23% of that 48% overall with dara/Revlimid being the second most popular regime.Third-line setting, holding at around just under the 40% so a very small decline in the market share from December. You'll recall that is something that we have projected as we move forward that we'll see gains particularly in the first-line, second-line setting and that we would see some decline in the fourth line. Just make sense that if you're using daratumumab in first, second, third line, by the time you get to fourth line, you're probably going to be using some of the other combinations. Of course, we're quite happy with that because again the largest portion of patients are in that first- and second-line setting. So it all looks positive, and it's what we predicted as being the trends for 2019 are panning out after the first quarter.
Your next question comes from the line of Michael Novod from Nordea.
This is Michael from Nordea. So most have been answered. But just a single housekeeping question. So you say U.S. dollar rate for your guidance of DKK 6 looked positive in my view. Just your rationale around that. So the first 4 months have averaged at sort of around DKK 6.6. It's right now DKK 6.67. It would take $1, around DKK 5.8 to get to your results. Just trying to figure out the rationale behind this, why is this being maintained just for our modeling, please?
Thanks, Michael, for the question. I will delegate that happily to David.
I was hoping you were going to, Jan, but I'm happy to do so. So yes, on the FX, overall, you're quite right that we used the exchange rate $1 to DKK 6.00. The rate at the end of first quarter was DKK 6.46. Now if we look back just a year ago to March 2018, the actual rate back then was DKK 6.0063, so in fact, the same rate as we used in our guidance overall. So it can move around quite a bit. So just over a year ago, it was at that DKK 6.00.Now I think when you look at our total numbers for the year, then we got DKK 1.5 billion of milestones, that's $250 million at the guidance exchange rate. As I said, $100 million is on the $2.5 billion sales hurdle and another $150 million on the $3 billion. So if you look at the DARZALEX sales, $629 million in Q1, you calculate that through even with sort of healthy growth quarter-on-quarter, then it obviously means that you're going to be predicting that those 2 large milestones are going to come in, in Q4 of 2019. Now we know where the rate is today. We can sort of assume where it's likely to go in Q2. Once it gets beyond that, we start looking out sort of 9 months, we know a year ago it was DKK 6.00. I don't know where that rate is going to be in the fourth quarter. And that's a very large portion of our revenue and of our operating result is based on those 2 milestones.Also to put into context, if you look at the first quarter, we had the DARZALEX sales and you will have seen that the royalty income increased a lot more than the actual underlying base sales from Janssen. So in rough terms, we made about DKK 50 million extra on the FX gain on the royalty in Q1. But if you think about it, DKK 50 million on a total revenue over the year of DKK 4.6 billion at this stage is not material. Then we'll continue to look at that. I mean we like to be transparent. We do put down the rates that we're using. And I know in some of the consensus numbers, people are assuming a higher rate.The only -- last thing I'd point out is, don't forget that there is actually European sales of DARZALEX. Those are getting converted into U.S. dollars as Janssen's functional currency. And you will have seen that in the first quarter Janssen reported sales of DARZALEX rest of world increasing by 65%. But on a constant dollar basis, they said it would have been 80%. So you do have some sort of round-robin calculation there where you get European euro sales for DARZALEX getting converted to U.S. dollars and then getting converted back to kroner, which is basically the same as the euro. So you just have to be a little careful not to double count the benefit there. But I'll leave it at that, if it's okay.
The next question comes from the line of Peter Welford from Jefferies.
Just 2 follow-ups, sort of clarity questions really. One, just on the comment you made with regards to COLUMBA that you said J&J was, I think, entering discussions with regulators based on those data. But just to be clear, don't we also need the combo study of the subcutaneous to be available as well before we can go to regulators? Or is COLUMBA itself sufficient for a subcu filing? And also just with regards to the new $200 million to $250 million contribution from MAIA in the first-line indication in the U.S. To be clear, have you looked at, at all the capacity currently of the major U.S. clinics to be able to adopt first-line DARZALEX given the intense infusion regimen to treat first-line patients? And is there actually chairs available to meet that given obviously, as you say, the intense initial regimen that you have when you start therapy?
Thanks, Peter, for the questions. So I will pass on the second one to David and then answer the first one myself. Strictly, there is only one noninferiority Phase III study needed, Peter, to get the label, potential label for the subcu formulation, but that's only in the refractory multiple myeloma population. Janssen intends to actually ask for a very broad label for all the potential indications. So one needs indeed also the data from the PLEIADES study, an over 180-patient Phase II study. Janssen has that data. That data will be presented, I think, soon also at a conference. And that together, that data will be filed together with the COLUMBA data in both U.S. and Europe in the summer time frame. The exact timing is not clear to me, but that is the timing I've heard from our partner, Peter. So they need both of the studies to get a broad label for the subcutaneous formulation. What I understand is if things go well, go very well, what we hope to see is indeed the full color of the COLUMBA data at the ASCO conference, potentially also at EHA a few weeks later. And I think they will also present the PLEIADES data at some point, but it seems to be in good shape. And then, David, maybe you can handle the MAIA question, the second question from Peter.
Sure. Yes, we did some independent market research that was Genmab market research in terms of any restrictions or capacity concerns. It didn't come out too much that there was a great concern over infusion chairs or capacity overall. More of the comment coming back was really the inconvenience of the long first dose. Of course, we have recently have the FDA approval on splitting that first dose, and that does help. That's more of an issue for the community setting rather than the larger hospitals overall.Also with the larger hospitals, although it's not part of the label, we have seen some of the information of being able to accelerate from the third dose onwards. So with the first dose, it is very long. It can be 6, can be 8 hours. By the time you're getting to the third dose, you're getting a little over 3 hours. So there is a lot of doses that come through, first weekly and then bi-weekly. But it's those first few doses that are the one that cause some of the pain, particularly in a community setting. But at this stage, we're not hearing -- and we particularly asked that question on the market research, we're not hearing it's a concern back from the doctors at this point. But certainly looking forward to 2020 and beyond, certainly if we're able to get the subcu formulation approved then that will certainly make all of that challenge disappear.
Your next question comes from the line of Jack Scannell from UBS.
I just want to know whether any of the pricing or access negotiations that you're having with DARZALEX outside of the U.S. are being made more problematic by proposals in the U.S. that perhaps move towards an international reference price?
Thanks, Jack, for the question. I think I will pass it on to David who is closest to the commercial team. David, can you give further color on that and actually from Janssen on pricing access?
Yes. Of course, that's something that Janssen is responsible for. So I mean our commercial people keeping close contact and conversations with Janssen. But probably at that level that would probably have to be a question that Janssen would have to answer rather than us. We did see from the Janssen commentary that they did make public on their Q1 call that the drug is now available in 40 EMEA countries and that was an increase of 9 new markets in Q1 2019. One of the ones we are particularly interested in to get the pricing reimbursement finally approved and established will be France as one of the large EU5. And we understand that those conversations are continuing. We look forward to hopefully getting that pricing approved and to get full and free access to DARZALEX in France as one of the large countries. Also in Q1, of course, we did have the good news that at last the U.K. NICE did approve the combination in the second-line setting combining DARZALEX with Velcade and dex, albeit through the cancer fund, but it's great to have wider coverage for the U.K. patients now.
[Operator Instructions] Your next question comes from the line of Graig Suvannavejh from Goldman Sachs.
I wanted to ask a question about split dosing. I know you've been approved in the U.S. and also in the EU. So can you kind of give us any color on what we're seeing with split dosing, if anything currently? And how should we think about split dosing evolve in time given the efforts to move things to a subcu formulation?
Absolutely, great. Thanks for the question. So split dosing as I understand is very, very frequently used in the U.S. That started in the bigger medical centers, the MD Anderson, the Sloan Kettering, the Dana-Farber, et cetera, but it's now also -- because Janssen can now promote for that, also use much more frequently in community health care centers. And the same holds for Europe, for the Netherlands, for Denmark, split dosing is used very, very proactively because apparently it was a worry to have this lengthy, generally like 8 to 10 hours depending on the status of the patients. And then concomitantly with that, Graig, the move from one nurse to a new nurse because of shift changes, that was not seen as very positive. So what I understand is that split dosing gets more and more frequently used in community health care centers. And I think it will only be used for some time because with the COLUMBA data now available and the PLEIADES data now available and assuming a filing in the summer time frame, hoping by early next year we can have a subcu formulation, which is far more convenient and at least as effective as you have seen from the top line data. And hopefully at both at ASCO and at EHA you will see the full data from COLUMBA and then hopefully that will lead to speedy label as a subcu formulation, which I think will take away a lot of the complexity with IV infusions, Graig.
Thank you. There are no further questions at this time.
So thank you all for calling in today to discuss Genmab's financial results for the first quarter of 2019, and we look forward to speaking with you all again soon.
Thank you. That does conclude our conference for today. Thank you for participating. You may now all disconnect.