Seagen Inc

F:SGT

Earnings Call Transcript 2021-Q2

[Operator]

Good day, and welcome to the Seagen Second Quarter 2021 Financial Results Conference Call. [Operator Instructions] Please note that this event is being recorded. I would now like to turn the conference over to Ms. Peggy Pinkston, Senior Vice President of Investor Relations. Please go ahead.

[Peggy Pinkston, Senior Vice President-Investor Relations]

Thank you, operator. And good afternoon everyone. I'd like to welcome all of you to Seagen's second quarter 2021 financial results conference call.

This afternoon, we issued a press release with our results, and that press release and supporting slides are available on our website in the Investors section, Events and Presentations page.

Speakers on our call today will be Clay Siegall, President and Chief Executive Officer; Todd Simpson, Chief Financial Officer; Chip Romp, Executive Vice President, Commercial U.S.; and Roger Dansey, Chief Medical Officer.

Following our prepared remarks, we'll open the line for questions. We aim to keep this call to one hour and so ask that you limit yourself to one question to give everyone an opportunity to participate in Q&A during our call today.

Today's conference call will include forward-looking statements regarding future or anticipated events and results, including the company's 2021 financial outlook, anticipated product sales, revenues, costs and expenses, and potential clinical and regulatory milestones, including data readouts, regulatory submissions and approvals. Actual results or developments may differ materially from those projected or implied in these forward-looking statements. Factors that may cause such a difference include the difficulty in forecasting sales, revenues and expenses, impacts related to the COVID-19 pandemic and the uncertainty associated with the pharmaceutical development and regulatory approval process. More information about the risks and uncertainties faced by Seagen is contained under the caption Risk Factors included in the company's quarterly report on Form 10-Q for the quarter ended Mach 31, 2021 filed with the Securities and Exchange Commission. And the Company’s subsequent reports filed with the SEC.

And now I'll turn the call over to Clay.

[Clay Siegall, President and Chief Executive Officer]

Thank you, Peg. And good afternoon, everyone. This was an exceptional quarter for our business in terms of commercial performance, as well as regulatory and clinical progress. We are pleased to report the highest ever net product sales across each of our approved medicines, as well as the highest sequential quarter-over-quarter dollar growth in product sales in our history. These results reflect strong commercial execution across PADCEV, TUKYSA and ADCETRIS. Our financial strength is driven by product sales, as well as royalties and multiple strategic collaborations.

We ended the quarter with $2.5 billion in cash and investments and have no debt. This positions us to expand our programs, advance our research and development and continue investing in our business. We remain focused on maximizing the opportunity and value of our approved drugs and developing additional transformative cancer therapies for patients around the world.

We look forward to sharing key business regulatory, commercial and development updates on the call today.

We are focused on three strategic priorities that empower our ability to drive innovation, growth and substantial benefit for our stakeholders, including employees, oncologists, our communities, shareholders, and most notably cancer patients. Our first strategic priority is to maximize the global potential of our three approved medicines through robust clinical development and exceptional commercial execution.

The first product I would like to highlight is PADCEV, a first-in-class ADC, that has quickly become standard of care in previously treated metastatic urothelial cancer. Earlier this month, FDA granted PADCEV regular approval in the U.S. based on data from the Phase 3 EV-301 trial, which demonstrated an overall survival advantage for patients treated with PADCEV chemotherapy. Full approval is important for the commercial team as inclusion of the OS data allows for promotion of PADCEV, demonstrated clinical benefit. PADCEV was also granted a second indication making it the first and only FDA approved therapy for urothelial cancer patients who are cisplatin-ineligible, and have previously received one or more therapies. As a meaningful proportion of bladder cancer patients cannot tolerate cisplatin-based chemotherapy, there is an urgent need for more treatment options such as PADCEV.

In addition to supporting regular approval in the U.S., the EV-301 data supports global regulatory submissions, which we and our partner, Astellas continue to move forward.

Another key product is to TUKYSA, a best-in-class, HER-2, tyrosine kinase inhibitor, which has become an important standard of care in the U.S. for the treatment of second and later line HER-2 positive breast cancer patients with, and without brain metastasis. TUKYSA is now approved in 36 countries and in addition to the U.S. has launched in Germany, France, Switzerland, and Austria. We are actively engaging with country-specific authorities to gain reimbursement and broader access for TUKYSA outside the U.S. We're pleased by early uptake, healthcare provider feedback and the fact that TUKYSA has already been included in key treatment guidelines.

TUKYSA’s broad clinical development program includes evaluation in HER-2 positive breast cancer, as well as colorectal and gastric cancers and in other HER-2 amplified or mutant tumors. We expect our strategic, commercial collaboration with Merck to further accelerate TUKYSA’s global reach in regions outside of the U.S., Canada and Europe.

The third product I'll highlight is ADCETRIS, which is the established foundation of care and multiple CD30-expressing lymphomas. ADCETRIS is a remarkable product that is commercially available in 76 countries and serves as the bedrock of our core business, enabling us to continue investing in our pipeline and other products. A decade after approval ADCETRIS just reported its highest ever quarterly sales, which serves as further evidence of the significant benefit it offers to patients. We are committed to maximizing ADCETRIS reach and continuing to advance a comprehensive clinical development program in Hodgkin lymphoma, diffuse large B-cell lymphoma and solid tumors. In addition, our partner Takeda is pursuing approvals for frontline Hodgkin lymphoma and peripheral T-cell lymphoma in its territories.

Our second strategic priority is to advance late-stage programs towards securing approvals for new products. Tisotumab vedotin or TB is currently under priority review by FDA, seeking accelerated approval for recurrent or metastatic cervical cancer with a PDUFA action date of October 10. TB is positioned to be our fourth commercial product as we look to expand our portfolio further and together with our partner Genmab, we are currently are on track with launch preparations. This is an important development in the treatment of cervical cancer, which in the recurrent or metastatic setting has a significant unmet medical need.

Our third strategic priority is to expand our deep and diverse early-stage pipeline through continued innovation, encompassing antibody drug conjugates, immuno-oncology agents, R&D investments, corporate development and strategic partnerships.

In closing, I'd like to recognize our employees and partners around the world who despite challenging conditions over the past 17 months have worked tirelessly to progress our programs and build our business. We have now begun the process of appropriately and safely returning our U.S.-based workforce to the office in a phased approach.

Next, I'll turn the call over to Todd, who will provide an overview of our financial results. Then Chip will discuss our commercial performance. After that Roger will provide an update on clinical development activities and our pipeline. Todd?

[Todd Simpson, Chief Financial Officer]

Great. Thanks Clay. And thanks to everyone for joining us on the call this afternoon. Our financial results reflect significant advancements made across the business. Today I'll summarize our financial results for the second quarter and year-to-date, which are in line with our expectations for the full year.

Total revenues were $388 million in the second quarter and $720 million for the year-to-date in 2021. Product sales from our three oncology franchises, totaled $347 million in the second quarter, representing 15% sequential, quarterly growth and 44% growth over the second quarter of 2020. This reflects revenues across our diverse commercial portfolio, which now has international reach.

Royalty revenues were $36 million in the second quarter in $64 million for the year-to-date in 2021. Growth over 2020 reflects increasing sales of ADCETRIS by Takeda, as well as royalties on sales of Polivy by Roche and Blenrep by GSK. As expected, collaboration revenues were modest at $5 million in the second quarter and $7 million for the year-to-date in 2021.

Cost of sales increased to $78 million in the second quarter and $142 million for the first half of 2021. This included product costs of sales and royalties for each of our three brands. The PADCEV gross profit share to Astellas, which was $39 million in the second quarter and $71 million for the year-to-date as well as non-cash amortization of acquired technology cost for TUKYSA.

R&D expenses were $235 million in the second quarter and $465 million for the first half of 2021. These are increases over 2020 and reflect increased investment across our early and late-stage pipeline.

SG&A expenses were $165 million in the second quarter and $325 million for the first half of 2021. These are increases over 2020 reflecting investments to support European TUKYSA launches and our global expansion efforts.

Lastly, we are maintaining our 2021 financial guidance and we're pleased with our performance in the first half of the year. We have significant financial strength, which allows us to continue investing in our pipeline in business.

Now I'll turn the call over to Chip for an overview of our commercial performance.

[Chip Romp, Executive Vice President-Commercial U.S.]

Thank you, Todd. Performance across the commercial portfolio was strong in Q2 and we believe we are emerging from the pandemic with positive momentum. We are well-positioned to drive continued growth with the recent PADCEV label expansion, additional country launches for TUKYSA and the approval of TV. We are seeing a meaningful increase in the number of in-person sales calls by our field team. And our commercial infrastructure and capabilities are in place to maximize future product launches.

ADCETRIS delivered a record quarter in noteworthy accomplishment for a ten-year-old brand. ADCETRIS sales were $182 million, a 9% increase over Q2 2020, and a 12% increase in volume over last quarter. Our field sales force is returning towards normal call activity levels with mostly face-to-face interactions. We are now actively promoting the landmark five-year ECHELON-1 progression-free survival data in frontline Hodgkin's lymphoma. As featured in The Lancet Haematology publication, this is meaningful data to physicians and patients and solidifies the ADCETRIS regimen as the best option for frontline Stage 3 or 4 Hodgkin’s lymphoma patients.

Moving on to PADCEV. Second quarter sales were $82 million, a 44% increase over the second quarter of 2020, and an 18% increase over last quarter. We are pleased with the conversion to full approval for PADCEV and a new indication for cisplatin-ineligible metastatic urothelial cancer patients who have previously received one or more lines of therapy. Our ability to now promote this new indication should drive incremental uptake, representing a meaningful, but modest opportunity.

As we’ve discussed in past quarters, the metastatic urothelial cancer setting continues to evolve. And we are confident that PADCEV is well positioned to remain the standard of care.

Transitioning to TUKYSA. Second quarter sales were $83 million, an increase of 18% over last quarter. Our U.S. launch has been very successful and we continue to see high levels of utilization in patients with and without brain mets. And patients with brain mets, TUKYSA is the most utilized product in second and later lines for HER2-positive breast cancer.

In Europe, early uptake has been very encouraging, notably with recent launches in France and Germany. The strength of evidence including demonstrated overall survival benefit from the HER2CLIMB trial along with favorable clinical guidelines gives us confidence as we execute our reimbursement strategy in Europe.

And finally, we were pleased that the TV BLA received priority review and if approved, this would be an important new drug for women with previously treated metastatic cervical cancer. The team will be ready ahead of the October 10th PDUFA date with a dedicated salesforce in place.

We were starting the second half of the year with great momentum across our portfolio of first-in-class or best-in-class products. And look forward to potentially adding another important medicine soon to our proven commercial model.

Now I’ll turn the call over to Roger to talk about our robust development activities. Roger?

[Roger Dansey, Chief Medical Officer]

Thank you, Chip. And good afternoon, everyone. I’m happy to share recent clinical development updates for our approved medicines and our pipeline. I’ll start with PADCEV. FDA originally granted PADCEV accelerated approval for the treatment of patients with locally advanced or metastatic urothelial cancer who have previously received a PD-1 or PD-L1 inhibitor and a platinum-containing chemotherapy. Continued approval was contingent upon confirmation of the clinical benefits in the EV-301 pivotal trial.

FDA has now granted PADCEV, regular approval based on the trial success, which demonstrated improved survival among patients who receive PADCEV compared to those who received chemotherapy. Further, the PADCEV U.S. prescribing information now includes a new indication for the treatment of metastatic urothelial cancer patients who are ineligible for cisplatin and have previously received one or more prior lines of therapy.

The new indication was also granted regular approval and it’s based on cohort 2 of the EV-201 trial. These results were recently published in Lancet Oncology and we are updated with additional follow-up in a presentation at ASCO. 51% of patients achieved a confirmed objective response with a median duration response of 13.8 months. These data are clinically meaningful in the setting of high unmet need where patients are older and are suffering from multiple comorbidities commonly including poor kidney function.

We are pleased with the broad nature of the second indication, which does not specifically require prior PD-1 or PD-L1 treatment. Additionally, the new label has been updated with important safety information, which further informs physicians on how to safely use PADCEV. The clinically compelling PADCEV data have enabled substantial regulatory progress outside of the United States with marketing applications currently under review in the EU, Australia, Canada, Japan, Brazil, Switzerland, and Singapore.

I will turn now to first-line metastatic urothelial cancer. At ASCO, we presented updated durability and other long-term outcomes from cohort A of the EV-103 trial evaluating PADCEV plus KEYTRUDA in cisplatin-ineligible patients. The data showed a continued objective response rate of 73% and median duration of response extending to 25.6 months.

Encouragingly medium PFS was 12.3 months. And median OS was 26.1 months. The safety profile of this combination was generally consistent with previous findings. We are using the same regimen in cohort K, which is intended to support accelerated approval. And we expect to complete enrollment of this cohort by the end of the year. In addition, we continue to enroll patients into the Phase 3 EV-302 global trial, which includes both cisplatin-eligible and ineligible patients evaluating PADCEV plus KEYTRUDA compared to platinum-containing chemotherapy regimen.

Our broad PADCEV development program also includes two Phase 3 trials in patients with muscle-invasive disease. Both trials test PADCEV in combination with KEYTRUDA. The KEYNOTE-B15 or EV-304 trial is enrolling cisplatin eligible patients and KEYNOTE-905 or EV-303 trial is enrolling cisplatin ineligible patients.

Additionally, in the next few months, we expect to initiate a dose-finding trial of single agent PADCEV in non-muscle invasive bladder cancer. PADCEV will be administered intro basically in BCG non-responsive patients. Nectin-4 is highly expressed in non-muscle invasive bladder cancer, and there is promising preclinical data to support the potential opportunity for PADCEV to be active in this setting. We are also evaluating PADCEV in the Basket trial of high Nectin-4 expressing solid tumors, including lung, breast, head and neck, gastric and esophageal cancer. And we await initial data to inform our next steps.

Turning now to TUKYSA. At ASCO, we presented long-term data from the HER2CLIMB trial. The primary analysis upon which TUKYSA was approved was conducted with 14 months of follow-up. This presentation extended the time of follow-up to 29.6 months. The updated median overall survival increased to 24.7 months for TUKYSA arm with benefit maintained across all pre-specified patient subgroups.

There has also been a recent update to the NCCN treatment guidelines for patients with CNS involvement to TUKYSA plus trastuzumab and capecitabine is now the only regimen in the setting with a category, one level of evidence. In earlier stages of breast cancer, we are evaluating TUKYSA plus Kadcyla versus Kadcyla alone in first and second line metastatic patients in the HER2CLIMB O2 trial. We and Merck intend for this trial to support global approvals including in China.

In high risk adjuvant breast cancer, enrollment continues in the randomized COMPASS HER2 RD trial evaluating TUKYSA plus Kadcyla versus Kadcyla alone, which has been run by the Allianz Corporate Group. In GI cancers, we remain on track to complete enrollment in the MOUNTAINEER trial by the end of 2021. This trial is intended to support an accelerated approval in the United States for patients with advanced HER2 positive colorectal cancer.

Also we are advancing TUKYSA in several studies, including in combination with Oxaliplatin platinum-based chemotherapy in first-line GI cancers. In a Basket trial for solid tumors of HER2 alterations that include mutations and in combination within HER2 for HER2 positive breast cancer.

Moving on now to ADCETRIS. We are pleased with the ECHELON-1 five-year manuscript was published in Lancet Hematology during the second quarter. As we have discussed, results demonstrated robust and durable remissions in patients with newly diagnosed advanced Hodgkin's lymphoma who received ADCETRIS in combination with ABD. Importantly, we also saw fewer second malignancies and more pregnancies in patients on the ADCETRIS arm of the trial. We continue to execute our ADCETRIS clinical development program that includes ECHELON-3. Our phase three trial in relapsed diffuse large B-cell lymphoma, which compares ADCETRIS plus Revlimid and Rituxan versus Revlimid and Rituxan. In frontline advanced as well as early stage Hodgkin lymphoma we are evaluating ADCETRIS in combination with nivolumab, adriamycin and dacarbazine.

And in solid tumors, we are evaluating ADCETRIS as an immunomodulatory agent in combination with Keytruda. I'll turn now to TV, which we are developing in collaboration with Genmab. The BLA currently under review is seeking accelerated approval of TV for the treatment of women with previously treated recurrent or metastatic cervical cancer. The BLA is supported by data from the innovative 204 trial, which has recently published in Lancet Oncology. In addition, we are enrolling the innovative 301 global Phase 3 trial in a similar population that is intended to serve as the confirmatory trial in the United States and to support global regulatory applications.

We believe TV could make a meaningful difference for women with cervical cancer, where there is such a high unmet need. Our next goal is to bring TV into earlier lines of metastatic or recurrent cervical cancer. And for that purpose, we are conducting the innovative 205 trial in first or second line. In this trial, we are evaluating TV in combination with chemotherapy or KEYTRUDA, and we expect to report data at a medical meeting before the end of the year.

Turning now to ladiratuzumab vedotin. We are working with our partner Merck focusing on optimizing dosing schedule as monotherapy and in combination with KEYTRUDA in breast cancer. We plan to present data from LV later this year.

Next, I'd like to highlight the breadth and depth of our early stage pipeline. We are advancing seven programs in Phase one clinical trials across a range of solid tumors and hematologic malignancies. These include the ADCs SGN-CD228A, B6A and SGNV and we expect to submit R&D for at least two more ADC programs this year. In addition, we have full, effector functioning, enhanced antibodies utilizing our ACA technology, including ACA-CD 40, CD70, BCMA antigens. With regard to ACA CD-40, earlier this year, we completed enrollments in a clinical trial, evaluating it as part of a combination regimen for the treatment of pancreatic cancer.

We expect to report clinical data from the trial sometime either later this year or early next year, as the data mature. We are also planning to initiate a Basket trial to evaluate ACA, CD-40 and other solid tumors. In closing, we have achieved many important milestones and have made significant headway across our pipeline in the first half of 2021.

We look forward to providing you with further updates on future calls. And now I will tell him the call back over to Clay.

[Clay Siegall, President and Chief Executive Officer]

Thank you, Roger. I'm proud of the remarkable progress we have made in growing and evolving our business and technology and enabling us to develop exceptional oncology therapies. Today, we have a deep and diverse pipeline, a multi-product commercial portfolio and additional potential approvals on horizon. Strategic partnerships are expanded global infrastructure and substantial financial power fuel our ability to advance our portfolio, including our early and mid-stage pipeline.

Our robust clinical development program and proven commercial engine demonstrate our ability to compete in the marketplace. And we are poised to maximize new assets and future launches. With our solid foundation, we are operating from a position of strength and are confident in our ability to continue delivering cutting edge innovation and transformative medicines for cancer patients worldwide.

Operator, please open the line for Q&A.

[Operator]

[Operator Instructions] Our first question comes from Andrew Berens with SVB Leerink. Please go ahead.

[Andrew Berens, SVB Leerink]

Hi. Congrats on the strong execution guys this quarter. I know you've given some guidance about the addressable markets by a line of therapy for PADCEV in the past. So I was wondering if you could tell us how much you think the label expansion to the second line increases the addressable market now and how saturated do you think PADCEV is in the third line?

[Clay Siegall, President and Chief Executive Officer]

Thank you for the questions and the comments, Andy. We're really pleased with the broad label that we got for PADCEV. There was – the 301 study confirmed the existing label, and then the cohort two, as we called it gave us a new population of patients that were cis-ineligible. We believe that some of these patients were likely getting unpromoted use of the drug in that setting. It's very hard to know how many, but it's certainly we don't think it was zero. So we'll continue to monitor the impact of this new indication on the commercial uptake of this. But we feel really great about the new labels.

[Andrew Berens, SVB Leerink]

Okay. How saturated do you think it was in the third line setting that it was originally approved in?

[Clay Siegall, President and Chief Executive Officer]

I think we're – we've got to standard of care pretty quickly there and docs really embraced using it. And I don't think we were a 100% saturated. It's hard to give guidance on it for what's happening. It's also – it feels like we're coming out of COVID a little bit, although with the new variants who knows. And so it's really hard to give exacting guidance. But I think we have room to continue moving upstream with PADCEV. It's a great drug and doctors are embracing it.

[Andrew Berens, SVB Leerink]

Okay. Thanks for the color, Clay. I appreciate it.

[Clay Siegall, President and Chief Executive Officer]

Sure. Chip, would you like to give a little color on this?

[Chip Romp, Executive Vice President-Commercial U.S.]

So, absolutely. I think it's just important to know that this is a dynamic market and with the advancements in treatment with regard to maintenance, we are seeing more and more patients become eligible for PADCEV earlier in their treatment journey than they would have in the past.

[Operator]

Our next question comes from Salveen Richter with Goldman Sachs. Please go ahead.

[Salveen Richter, Goldman Sachs]

Good afternoon. Congrats to the nice quarter. Could you comment on the trajectory of your products in second half, given there is suggestion of negative growth for ADCETRIS and TUKYSA per your guidance, and then what drove the inflection for ADCETRIS this quarter?

[Chip Romp, Executive Vice President-Commercial U.S.]

Okay, well, thanks very much for the questions on everything. We're not trying to provide down guidance on anything. It's just hard to really know exactly what will happen as we either get out of COVID or not. And so we just want it to be a prudent with our guidance and we watched things very close on this. Todd, do you want to give a little bit of color on what we're thinking about in terms of financials and guidance?

[Todd Simpson, Chief Financial Officer]

Sure. So thanks for the question Salveen. First of all, start off by saying, we don't try to give quarterly guidance. We give annual guidance. And the reason for that is, quarters fluctuates. We just came out of a very strong quarter, which we're delighted about. Q2 typically is a strong quarter for us, especially compared to Q1. And when you annualize first half of the year and compare that to our guidance, we think our guidance is appropriate, which is why we've maintained it. But there's a lot going on and we're really pleased with what we're seeing. The year's off to a great start. It's terrific to get our field teams for the most part back into the field, which is where they can do their best work.

And there were a lot of things that were tracking, for example, with ADCETRIS. We've now – we're now promoting to the five-year data. We are looking at return of patients in the clinic out of the pandemic. But it's frankly a little too early to tell exactly what's going on.

So PADCEV, we're looking forward to now promoting to the cohort to label, which as you heard on the call is incremental because we're probably getting some of those patients before.

And then with TUKYSA, we're delighted to now complement the U.S. launch with now launches starting in Europe, most notably in France in Germany. So again, we're really pleased with how the year has gotten off to start and feel like we're in good position going into the second half.

[Salveen Richter, Goldman Sachs]

Great. Thank you.

[Operator]

Our next question comes from Kennen MacKay with RBC Capital Markets. Please go ahead.

[Kennen MacKay, RBC Capital Markets]

Hey, thanks for taking the question and congrats to the team on the really terrific quarter here. This is awesome to see after the seasonal weaknesses in Q1 and then COVID impacts there. Maybe on the commercial side of things for Clay or for Chip, can you maybe talk to U.S. trends versus ex-U.S. and European trends? And perhaps how that Q2 out-performance related to easing of COVID-19 restrictions and any commentary you can give on early signs of how that's continuing into Q3. And I'd love to hear any commentary you can give around U.S. versus European, especially if it relates to the geographic expansion for TUKYSA.

[Clay Siegall, President and Chief Executive Officer]

Well, Kennen, thanks for the comments and the questions. Chip, can you try to talk a little bit about U.S. trends and what you're seeing with all three brands and as it relates to COVID-19, and we'll start there and then we'll get into the U.S. versus European.

[Chip Romp, Executive Vice President-Commercial U.S.]

Absolutely, Clay. So as far as ADCETRIS goes, I think this is an opportunity to show how the five-year date is resonating with physicians of five years is an important and meaningful endpoint for physicians. This shows the durable aspect of the original trial that we did on ADCETRIS. I think in addition to that, we have some publications that have put out in June in Lancet Hematology, which represent this data set. I think we're getting traction with that now on ADCETRIS.

I think as far as PADCEV goes, I spoke earlier about the dynamic nature of the market. What we're seeing is as the market continues to change, more maintenance therapies being used and PADCEV is being used in earlier lines as a result of that. We are excited to have the new label to where we can promote versus spot in eligible patients, and we think we will get traction from that. And then with regard to TUKYSA, the TUKYSA is demonstrated an overall survival benefit in the HER2CLIMB trial. This really resonates with physicians. It's helped us to continue to gain share in patients with and without brain mets.

[Clay Siegall, President and Chief Executive Officer]

Now, and concerning the European question of the U.S., trans European. We're really excited with going into Europe, we have broad approval throughout all of Europe. But we only have a few countries that we have reimbursement to date. So most of our sales are coming from the U.S., because there's only a few countries in there. But we expect over time to get all those countries reimbursement. It just takes a little longer to get reimbursement, but in Europe there's no issue, no problem. This is all what we expected and you've seen before with other products. And so things are going well there, but it's really hard to give you a definitive answer on the ex-U.S. trends with TUKYSA since we're pretty early in the game there.

[Kennen MacKay, RBC Capital Markets]

Totally got it. Maybe just a follow-up Clay or perhaps with Roger, the potential for PADCEV to move into pre-muscle invasive bladder cancer with intravesicular dosing is super interesting given the potential to transform that market. And maybe you're going to alleviate the reliance on cystectomy. And you have that linker that maybe uniquely enables you to perform that intravesicular delivery. Can you maybe talk a little bit about how you're thinking about going forward potentially into that market there? I know it's early, but I'd love to understand whether you're thinking about combinations either with BCG or checkpoints or simply planning to evaluate that monotherapy activity before making any decisions. Thank you. And congrats again.

[Clay Siegall, President and Chief Executive Officer]

Great question. Kennen, a really good question. Yes, we're very interested. And Roger, can you take this and see the best way to address that?

[Roger Dansey, Chief Medical Officer]

Yes. Thanks Clay. And thanks for the great question. I think, we've got strong preclinical evidence to move forward. The value proposition of giving something like PADCEV into the bladder, because the main body of people who treat patients with sufficient bladder cancer is urology and urologists, that's their bread and butter. So it's a really good sort of, it's a good match for the disease state, because we expect the systemic exposure of PADCEV to be very limited. So the safety profile could be quite promising. And as I said, in my prepared remarks, Nectin-4 is expressed in non-muscle invasive bladder cancer. And I think Kennen, all of the things that you raised, like where could we go with this? And what populations could we address? I think those are all at least theoretically on the table, but we have to start at square one, which is, let's take the people who failed BCG and see if we can reverse the disease state.

So that's – that is our starting point. We need to prove that PADCEV, Kennen in fact know, have impact on those legs, sort of non-muscle invasive bladder patients. And once we've got that and we can determine what its profile looks like, then I think the development in non-muscle invasive bladder cancer can go as far as we like. As you know, pembrolizumab is approved. There are some other agents were approved. The goal is to clear the disease. And so depending on the efficacy profile, adding another agent would be a reasonable thing to do.

[Operator]

Our next question comes from Geoff Meacham with Bank of America. Please go ahead.

[Unidentified Analyst]

Hey guys. It's Aspen on for Geoff. Thanks for the questions. Just a couple on the commercial launch for TV. Basically just want to get some more color on what needs to be done and what exactly has been done to prep for that. And maybe how do you emerging variants kind of play into your thoughts on what that launch might look like in the U.S. at any learnings you can take from the – they are the mid-pandemic TUKYSA launch over to TV would be helpful as well. Thanks.

[Clay Siegall, President and Chief Executive Officer]

Sure. Look, we're really excited about potentially getting a fourth product, I say potentially because it's not approved yet by FDA, but we're – we submitted those file. We're working hard with them to try to get this thing on the market to help patients, PDUFA date is I think October 10 and we're working hard toward that. A lot of work to do behind the scenes that nobody knows that companies do when they're trying to launch product. Chip, can you talk a little bit about the commercial, what we're seeing and whether you think there's any, anything going on with the COVID variants, but in general, can you talk a little bit about how we're thinking about this launch?

[Chip Romp, Executive Vice President-Commercial U.S.]

Yes, absolutely. So the teams have been working for over a year now getting the right structure, the right roles in place associated with this. We have a fully staffed and dedicated salesforce, which is going to work in co-promotion with Genmab in the U.S. So we've got a corporate partner that we're looking forward to partnering when the product becomes approved. In addition to that, this is an important kind of unmet medical need. Metastatic cervical cancer is a devastating disease. And I think there's going to be an opportunity for improvement, potentially outcomes with a product like this.

As far as the COVID commentary, we – most of our field salesforce is now out making face-to-face calls, or most of our calls I should say are face-to-face. We're continuing to monitor what happens. It's an unforeseen future with regard to these variants. But what we do have is a model which have a full virtual launch behind us. We can leverage that experience should things in the future change. And we will do that. But what our plans right now are really to build upon the successful launches that we've had leveraging the right parts of that infrastructure when necessary.

[Unidentified Analyst]

Thank you.

[Operator]

Our next question comes from Michael Schmidt with Guggenheim. Please go ahead.

[Michael Schmidt, Guggenheim]

Hey guys. Thanks for taking my questions and congrats on the quarter as well from me. I had a couple of pipeline questions. Maybe first on the LIV-1A data that we saw that title for the upcoming ESMO presentation, Roger on the weekly dosing schedule. Just wondering what you're looking for in this data and how it will guide a next development step in breast cancer. And then on the CD-40 antibody, pancreatic cancer is obviously a huge potential market opportunity, but it also has been difficult in terms of drug development historically. What do you need to see in the single arm study to really – that really gives you confidence and in this combination to potentially succeed in a future Phase 3 trial? Thanks so much.

[Clay Siegall, President and Chief Executive Officer]

Roger, go ahead.

[Roger Dansey, Chief Medical Officer]

Sure. Yes. Thanks for the question. So, LV is as we have said a few times now, we are continuing to work on optimizing dosing schedule. And the first piece of data that we'll be sharing will come up at ESMO. And we're still working, we're working with our partners. It's an active agent, whether it’s active, there is no doubt, both as monotherapy and in combination. And we're trying to find the sweet spot of what is the right dose and what is the right scheduling. So that's our plan with LV and you'll see some data coming up at ESMO.

With regard to CD40, it's a great question. Just from a science – firstly, we have a well-defined CD40 agonist. We understand the dosing as a monotherapy. We have some activity as a monotherapy. So that part is clear.

With regard to the scientific concept of combining a CD40 agonist together with chemotherapy and the PD-1 inhibitor, that's exciting, and that doesn't necessarily has to limit itself to pancreatic cancer. And that's why we're indicating that we're interested in pursuing a basket trial in tumors that may in fact be more immune, manipulable than something like pancreatic cancer.

With regard to what data do we need to see, as you pointed out, pancreatic cancer has been a very difficult disease to develop drugs in. And people have been misled with small numbers and focusing on sort of early end points to find out in large trials that one doesn't show any improvement over standard of care. So, I think we're interested without going into the details of what exactly we would like to see. We are interested in all endpoints, which will include what does the response rate look like on the frontend, how much disease control can we get that would be measured by PFS? And most importantly, what does the survival curve look like? And I think all three of those elements need to be part of our evaluation then once we have the data.

[Michael Schmidt, Guggenheim]

Great. Thanks so much, Roger.

[Operator]

Our next question comes from Cory Kasimov with JPMorgan. Please go ahead.

[Cory Kasimov, JPMorgan]

Hey, good afternoon guys. Thanks for taking the question. I wanted to follow-up on the SEA-CD40 program. And I guess, first of all, what determines whether we'll see that S40 data later this year versus early next, is it getting kind of that early look at those survival curves as you were just talking about Roger? And when we do see the data, I believe like with pancreatic or the expansion cohorts go up to 75 patients per indication. But are all the pancreatic patients on the same combination or there are variety of combinations being evaluated? Thank you.

[Roger Dansey, Chief Medical Officer]

Yes, thanks for the question. With regard to the last piece, we have focused the same combination. So, it's the standard chemotherapy, plus pembrolizumab, plus our CD40s. So, the triplet in that component is in fact the same.

With regard to timing, you are exactly right, we need enough maturity on all the end points in order for us to make our best estimate as to whether this is worthwhile taking into a pivotal trial, or we need to do more work. And so, in terms of the timing of when that data will be available, it sits on the cusp of the year. And so, it's very hard for us to predict will we be able to share the information in 2020, or will it go into – sorry, not 2020 I mean, year behind 2021, or will it be in 2022. But we're monitoring very closely. And as soon as we believe we have matured enough data, we'll get it out in the public domain.

[Cory Kasimov, JPMorgan]

Okay. Thank you.

[Operator]

Our next question comes from Gena Wang with Barclays. Please go ahead.

[Gena Wang, Barclays]

Thank you for taking my questions. So, I have one question regarding the Daiichi litigation. I know the arbitration decision should be anytime now. I'm just wondering, how will you share the decision with us and how would the decision impact the next steps and the also the other ongoing litigation?

[Chip Romp, Executive Vice President-Commercial U.S.]

Thanks very much for the question on our litigation. I like to say, first of all, that over our history of 24 years, we are not a litigious company. We have only taken action that's appropriate to defend our IPO contractual rights. So, this is not something I hope you'll see from us on a routine basis. Now the arbitration hearing was conducted in June. And we expect a decision sometime later this year from the arbitrator. And things are proceeding according to the schedule that was set by the arbitrator.

So right now, we think everything is proceeding in an expected standard way. And nothing is unusual from what we've seen and we're going forward there. We will provide updates as soon as we have them and when we're permitted to, in the process. So, we're not going to hold something just for ourselves as soon as we could do stuff.

But I want you to know that we feel very confident in our position and we feel like it's a very important to defend our legal rights and protect the innovation that we work on so hard and deliver for patients. And so that's really where it is.

You asked a question on what's the next step? Well, it depends on what comes down with the arbitration. So, it's hard really to predict the next step. But we feel very good about our case.

You asked to also, I'm sorry, about the other litigation. There was also a patent infringement lawsuit that that's not going to court sometime next year. So that's a little different, that's not in front of an arbitrator, that's actually a court. And so that's ongoing as well. And we feel good about that one as well.

[Gena Wang, Barclays]

Great. Thank you.

[Operator]

Our next question comes from Zhiqiang Shu with Berenberg. Please go ahead.

[Zhiqiang Shu, Berenberg]

Great. Thanks so much for taking my questions and congrats again on the great quarter. I have two questions. One is related to ADCETRIS. So obviously it's a strong quarter after a stagnant quarter. I was wondering this growth is it a reflection of the pandemic is behind us, or is it a result of the five-year data that compelled the physician to prescribe the drug? That's the first question on ADCETRIS.

And the second question is related to your TIGIT antibody I think you share some very interesting preclinical data last year at your R&D Day. I was wondering, do you plan to share more data on this program? And in light of, the new deal amendments in the field how are your thinking around this asset? You've already, thanks very much.

[Roger Dansey, Chief Medical Officer]

Sure. Let's start with the ADCETRIS question. Yes, indeed we had a strong quarter. We're really excited. I think there might be something about the damage starting to wane, although we continue to monitor that. And then, wow, I'm sorry.

[Peggy Pinkston, Senior Vice President-Investor Relations]

God bless you.

[Roger Dansey, Chief Medical Officer]

You will be alerted to your question. And then there's the five-year data that Chip referred to. So, I think, Chip, you may want to comment here with more color. I think it's a little bit of both, not just one or the other. Chip, what are you thinking?

[Chip Romp, Executive Vice President-Commercial U.S.]

So, I would agree with you, But I can speak to the five-year data with regard to feedback from our physicians and customers. They have found this data to be compelling.

[Clay Siegal]

You asked a question about TIGIT. So, TIGIT, we have a differentiated TIGIT. And Roger’s development team is developing it and, I think they planned to put out data at appropriate times. Roger, do you want to provide any color on that?

[Roger Dansey, Chief Medical Officer]

Yes, and it's a great question. I think we certainly pre-clinically, we see outages as a best-in-class. I mean, we absolutely understand that this is a, this is a comparative environment. And so, we're working hard and coming up with a development plan that will have the opportunity or gives outages the opportunity to showcase itself and move as quickly as possible if it's appropriate into pivotal trials.

So, what I can say is that the TIGIT development team is excited by the opportunity. We are enrolling well, we're working on things like defining dosing schedule, which is what one does in a Phase 1 trial, and thinking very carefully about where we would like to expand our evaluation including obviously in combinations. So, no details to disclose. But lots of thought is going on into that program.

[Zhiqiang Shu, Berenberg]

Great. Thanks very much.

[Operator]

Our next question comes from Jay Olson with Oppenheimer. Please go ahead.

[Jay Olson, Oppenheimer]

Hey, congrats on the quarter. And thank you for taking the questions. Can you talk about what lines of therapy you're seeing in the U.S. and Europe for TUKYSA, and if there's any spontaneous, unpromoted use in first-line? And then can you also talk about any impact you might be seeing from Trodelvy to PADCEV in bladder cancer? And any feedback that you're getting from doctors related to the efficacy and safety profiles or how these two compare in clinical practice? Thank you.

[Roger Dansey, Chief Medical Officer]

Sure. On the TUKYSA front Chip, could you address like where it's used in Alliance and then we'll come back to the second question.

[Chip Romp, Executive Vice President-Commercial U.S.]

Yes, sure. What I can tell you is that we are seeing continued utilization in growth in share across all lines of therapy in the label second line and beyond in both patients with and without brain metastasis. It's also important TUKYSA is now the most utilized product in second line and later for HER2 positive metastatic breast cancer patients with brain mets. So, it's broad, it's broad growth.

[Clay Siegal]

As far as your second question, Trodelvy is not approved in bladder cancer at this point. So, you are asking sort of ahead of time what it is. We have some fantastic data and survival data. We're not expecting much impact from Trodelvy. I think that largely would be used after PADCEV. I think PADCEV, has such premiere day, we're focused on also frontline and getting that. But even in the setting where we are with survival data, you'd be hard pressed for a doc to use that ahead of another product. But I'm glad that Trodelvy exists and I hope they get approval and could be there for patients that we needed it.

PADCEV doesn't care every patient and other therapies are needed. So, it's fine.

[Jay Olson, Oppenheimer]

Great. Thanks again for taking the question

[Operator]

[Operator Instructions] Our next question comes from Andy Hsieh with William Blair. Please go ahead.

[Andy Hsieh, William Blair]

Great. Yes, thanks for taking my question. I'm really glad to see the commercial inflection across the three key products this quarter. Clay in your prepared remarks, you mentioned this phrase, which I found very interesting, you said ADCs and immuno oncology. So, I'm just curious if you are hinting that we could expect modalities beyond the sugar-engineered antibodies or traditional kind of the antibody linker payload, construct of ADCs in your development pipeline?

[Clay Siegal]

So first of all, our SEA products we refer to as our immuno oncology products. We also do a lot of immuno oncology work in combination with our ADCs as you know, from all the work we've done with KEYTRUDA, Opdivo and many others actually. It's not limited just to those two. So, we do take into account immuno oncology. We're always looking at other ways to append things to antibodies, and you can be guaranteed that in our lab, we are looking at some very interesting approaches, things that we won't be talking about on a conference call now, but can come out in a not-too-distant future. So, we have some exciting things that are in the horizon. So, buckle up and stay tuned.

[Andy Hsieh, William Blair]

Great. Thank you.

[Operator]

That concludes our question-and-answer session. I would like to turn the conference back over to management for closing remarks.

[Peggy Pinkston, Senior Vice President-Investor Relations]

Okay, thank you operator and thanks everybody so much for joining us this afternoon. Have a good evening.

[Operator]

The conference has now concluded. Thank you for attending today’s presentation. You may now disconnect.