Blueprint Medicines Corp

NASDAQ:BPMC

Earnings Call Transcript 2023-Q1

[Operator]

Good morning. My name is Kelly. And I'll be your conference operator today. At this time I would like to welcome everyone to the Blueprint Medicines First Quarter 2023 Financial Results Conference Call. All lines have been placed on mute to prevent any background noise. After the speakers' remarks, there will be a Q&A session. [Operator Instructions].

Jenna Cohen, please begin.

[Jenna Cohen, Senior Director and Head, Investor Relations]

Thank you and good morning, everyone. Welcome to Blueprint Medicines first quarter 2023 financial and operating results conference call. This morning, we issued a press release, which outlines the topics we plan to discuss today. You can access the press release, as well as the slides that we'll be reviewing today by going to the Investor section of our website at www.blueprintmedicines.com.

Joining today with prepared remarks are Kate Haviland, Chief Executive Officer; Philina Lee Chief Commercial Officer; Becker Hewes, Chief Medical Officer; and Mike Landsittel, Chief Financial Officer; Fouad Namouni, President of Research & Development; and Christy Rossi, Chief Operating Officer are also joining our call and will be available for Q&A.

Before we begin, I'd like to remind you that some of the statements made during the call today are forward-looking statements and are subject to a number of risks and uncertainties that may cause our actual results to differ materially, including those described in our reports filed with the SEC.

I'll now hand the call over to Kate.

[Kate Haviland, Chief Executive Officer]

Thanks Jenna, and good morning everyone. Last year we introduced our 2027 Blueprint, a five year growth strategy to achieve what we call precision at scale. What lies at the heart of that vision is our ability to scale our business operations as we execute on commercial launches, advance our clinical programs, and bring even more innovative compounds into the clinic.

Our progress in the first quarter of 2023 has certainly shown that we are driving performance and are poised to deliver tremendous value in the years ahead. First, we delivered strong commercial performance in Q1. We achieved $39.1 million in AYVAKYT net product revenue for the quarter, driven by growth and demand, as well as by strong execution that resulted in favorable dynamics and the proportion of patients on commercial drug. In a moment, Philina will discuss in more detail our continued success in driving AYVAKYT uptake in advanced SM.

Second, we continue to advance our pipeline. We are resuming the VELA trial of BLU-222 after working with the FDA to expeditiously resolve a partial clinical hold within weeks. Our team's fast progress and coordination with the FDA emphasize, how well we collaborate with regulatory agencies in the face of an ever evolving regulatory landscape, and the urgency with which we are working to bring our investigational medicines to patients in need.

Third, we advance towards key data inflection points for our best-in-class innovative investigational medicines. We announce that next month at ASCO, we'll present dose escalation data across three of our development programs. Becker will share more about what you can expect at ASCO later on the call. Blueprint is distinguished by having a breadth of new product opportunities across our pipeline and at the same -- while at the same time we are heading into a major commercial launch with the expansion of our AYVAKYT label.

We are now a couple weeks out from our PDUFA date for AYVAKYT and indolent SM. Our field teams are in the market delivering on pre-launch activities and are ready to support healthcare providers and patients upon approval. This approval will further solidify Blueprint's leadership in ASAP. As the cornerstone of our SM franchise AYVAKYT establishes the bar as both the first and best-in-class therapy for ISM, enabling our team to accelerate the realization of what we are confident will be a greater than $1.5 billion market opportunity.

Now let me turn it over to Philina to discuss our commercial progress with AYVAKYT and the confidence we have in our go-to-market execution. Philina?

[Philina Lee, Chief Commercial Officer]

Thanks, Kate. Good morning everyone. We had a strong first quarter generating AYVAKYT net product revenue of $39.1 million, including $34.9 million in the U.S.

Let's look at the key sources of revenue growth in more detail. Half of this growth was due to greater demand and strength across several fundamentals in our AYVAKYT based business. We grew the number of patients on therapy exiting the quarter with approximately 520 patients on AYVAKYT in the U.S. We added over 70 new accounts increasing the breadth of prescribing to nearly 460 accounts with AYVAKYT experience, and we continue to capture more than 75% of new patient starts and switches. The remaining half of this growth we saw this quarter was driven by a reduction in the percent of patients on free drug as some patients were instead able to receive AYVAKYT commercially. We expect this benefit to be temporary and the proportion of patients on free drug to return to more typical levels by the end of Q2.

We've also completed the hiring and training of our expanded field team members who have been activated and engaging customers since the end of the quarter. With the full force of our highly experienced team in place, we expect to drive continued growth in advanced SM and we are ready for ISM. The year is off to a strong start giving us great momentum as we head into the ISM launch. We have never been so ready to unlock the opportunity and deliver for many more patients living with SM.

Let's look to that next. We are just 18 days from our PDUFA date in ISM and the energy at Blueprint Medicines is electric. Our team is ready, the market is ready, and patients are waiting for AYVAKYT. We have shared previously the three pillars of our launch strategy, healthcare provider engagement, patient activation, and patient access. We have consolidated our ISM launch preparations across each of these three areas.

First, provider engagement. Among Hem/Oncs and allergist immunologists, managing patients with ISM, we have grown unaided awareness of AYVAKYT to approximately 40% or double what you would expect from industry benchmarks. Our field teams have profiled and built relationships with 100s of high volume healthcare providers to identify patients in need who are most likely to initiate AYVAKYT.

Second, patient activation. It's something our unbranded disease awareness campaign is drawing 1000s of people who are signed up to receive more information about SM and AYVAKYT upon approval. And third access, our patient support program your Blueprint continues to secure industry leading times to fill. And the 25 mg dosage strength is already in the channel with broad payer coverage. These three strategic pillars also frame the performance metrics that will focus on to frame our launch progress post-approval.

For provider engagement and patient activation, our goal is to drive to a decision to treat with AYVAKYT. And to measure our progress, we'll look at prescriber breadths, particularly in allergist immunologists as well as growth in the number of patients in therapy. In a chronic disease like ISM, growth in patients on therapy is an important lead indicator of continued revenue growth. We'll also be looking to maintain strong patient access for AYVAKYT and will track payer coverage relative to label through the ISM launch.

As I shared with our team at our national field meeting last month, the SM story is a Blueprint story. We are the pioneers. The opportunity is there and we're ready to deliver for patients. We have the right medicine, the right team, and we are ready to launch.

And with that, I'll hand it over to Becker, who will share progress across our burgeoning portfolio as we prepare for ASCO.

[Becker Hewes, Chief Medical Officer]

Thanks, Philina, and good morning everyone. Blueprint has an exciting pipeline of potential first-in-class and best-in-class therapies targeting CDK2 EGFR and other key targets. We operate on the premise that if the preclinical profiles of our compounds are born out in the clinic, multiple Blueprint Medicines could become future cornerstones of treatment. We continue to make progress towards that goal. And last week we announced the acceptance of data presentations at ASCO that will provide an update on dose escalation as we work towards defining recommended doses across three of our Phase 1, 2 programs.

First, we have our initial clinical data for BLU-222, our selective CDK2 inhibitor focused on advancing treatment of breast cancer and other CDK2 vulnerable cancers. The data at ASCO will demonstrate evidence of monotherapy, safety, and pathway modulation. The safety profile is particularly important here as we anticipate that the maximum benefit of BLU-222 will be in combination with other agents such as CDK4/6 inhibitors like ribociclib.

Following ASCO, we will continue enrollment in monotherapy cohorts and in parallel continued dose escalation of the combination of ribociclib in breast cancer patients. Second, we have our initial clinical data disclosure for BLU-451 in EGFR exon 20 mutant non-small cell lung cancer. These data will show safety and early clinical activity including evidence of CNS activity, that reinforced best-in-class potential for BLU-451.

We're continuing to work through dose escalation cohorts to optimize a dose and regimen and at ASCO will show progress to date. Third, we will present updated dose escalation data on BLU-945, both as monotherapy and in combination with osimertinib in a heavily pretreated EGFR mutant patient population. A key focus of this presentation will be the safety and tolerability of BLU-945 in combination with osimertinib. This tolerability is remarkable given the failure of previous EGFR targeted combinations with other EGFR inhibitors and osimertinib due to additive wild-type EGFR toxicity.

We are on track for our other important pipeline milestones as well, including nomination of a development candidate targeting wild-type kit for chronic urticaria in the middle of this year. We look forward to sharing more data next month as we reach these milestones and make progress towards our 2027 Blueprint. With that, I'll turn the call over to Mike to review our financial updates.

[Mike Landsittel, Chief Financial Officer]

Thanks Becker. Earlier this morning, we've reported detailed financial results in our press release and for today's call, I'll touch on a few highlights from the quarter. In the first quarter, total revenues were $63.3 million, including $39.1 million in net product revenues from sales of AYVAKYT and $24.2 million in collaboration and license revenues.

As Philina noted, we saw continued growth in AYVAKYT demand that helped drive quarter-on-quarter revenue growth as well as one-time free goods favorability that we expect to unwind in Q2. We are pleased with our progress early this year and are now updating our AYVAKYT net product revenue guidance for 2023 to reflect the patient mix favorability that we observed in the first quarter.

We now anticipate approximately $135 million to $145 million for our currently approved indications of advanced SM and GIST. Based on our PDUFA date, Q1 is our last full quarter of revenue prior to our anticipated ISM launch. As we have noted, we do not plan to issue guidance including ISM this year as it will be too early in the launch to do so.

We expect to see continued growth in Advanced SM through this year driven by patient demand. Our anticipated label expansion into ISM will be the main driver of AYVAKYT growth in the second half of the year.

Turning now to expenses, our total costs and operating expenses were $187.5 million for the first quarter. Financial discipline remains a priority for Blueprint and we saw that play out as we showed quarter-over-quarter operating expenses declined for the third consecutive quarter.

Similar to our expense guidance from last quarter, we expect a slight increase in operating expenses in the first half of the year related to launch preparations and clinical pipeline investments and then expect a quarter-on-quarter OpEx to be relatively flat for the remainder of the year.

In February, we announced that we are in the process of regaining development and commercialization rights for GAVRETO from Roche. We do not anticipate any incremental OpEx impact related in 2023 related to this transition. We have initiated a process to re-partner GAVRETO as we believe that this is the best model to drive value going forward as we prioritize our focus on SM.

We are in a unique position and that AYVAKYT is a breakthrough medicine that has been significantly de-risked and Blueprint Medicines has a clean growth story as we continue to generate commercial revenue and make progress on multiple assets across our clinical pipeline. We remain in an exceptionally strong financial position with nearly $1 billion in cash and a planned reduction in our annual operating cash burn, a trend that we expect will continue as we grow revenues and remain disciplined around operating expenses.

This continued financial strength will help fuel our 2027 Blueprint to achieve precision at scale and create transformative value for patients and shareholders. With that, I'll now turn the call over to the operator for questions. Operator?

[Operator]

Thank you. [Operator Instructions]. Thank you. Your first question comes from Eun Yang of Jefferies. Please go ahead.

[Eun Yang, Jefferies]

Thank you. So in terms of our AYVAKYT in advanced SM, could you talk about what really, what types of patients in advanced SM population actually drove increased uptick and based on why you saw quarter-over-quarter, do you think third quarter last year is kind of anomaly kind of a seasonality that you might expect?

[Kate Haviland, Chief Executive Officer]

So thank you, Eun. So I think what you're asking is, we lost the first part of your question, but I believe what you're asking is what was the mix of kind of the base growth in terms of advanced SM patients and then just the dynamic quarter-over-quarter and I think what we've mentioned before is that, advanced SM is very much a rare disease and we're going to see lumpiness quarter-over-quarter. It's really kind of what we see over the course of a year that's going to be important there. And we're happy to see the dynamics that happen here in Q1 and to be able to raise our guidance to $135 million to $145 million, but Philina do you want to talk about the mix in the advanced SM growth?

[Philina Lee, Chief Commercial Officer]

Yes, thanks Eun. So starting with the mix, we were really pleased to see growth across many subtypes of advanced SM especially in the subset of patients who have SM-AHN, which is the most common subtype where we saw a 15% growth in the market share of AYVAKYT into patients with SM-AHN. To your question about quarter-over-quarter growth, again I'd say we were extremely encouraged to see 30% growth in Q1 coming out of Q4.

As we've talked about, growth in advanced SM is something that we continue to see, albeit at a more measured pace than in the early stages of launch. But our greatest growth driver ahead is our pending ISM launch with approval, which we expect to be the most significant source of AYVAKYT growth going forward.

[Eun Yang, Jefferies]

Thank you. A follow-up to ISM, so in the past you mentioned that you were expecting a broader label from the FDA, I don't know if you want to make a comment as we get so close to the FDA action date, but is that still what you are expecting broader label for ISM?

[Kate Haviland, Chief Executive Officer]

So hey Eun, this is Kate. So I don't think we've talked really about what we expect from a label perspective on ISM and as you said, this close to the action date, we don't really talk about the kind of the discussions we're having with the regulatory agencies. Things are on track, we're having a good collaborative discussion and we're on track for our PDUFA.

[Eun Yang, Jefferies]

Thank you.

[Kate Haviland, Chief Executive Officer]

Thank you.

[Operator]

Thank you. [Operator Instructions]. Thank you. Our next question comes from Salveen Richter of Goldman Sachs. Please go ahead.

[Unidentified Analyst]

[Indiscernible] for Salveen. Thank you for taking our question. Just one on the guidance. Are there any other underlying assumptions outside of patient mix that's driving the raise and then just quickly on the ISM launch, could you just walk us through how you're planning to target the physicians that have the patients that are adequately controlled with the best supportive care? Do you have a mechanism in place for switching those patients? Thank you.

[Kate Haviland, Chief Executive Officer]

So thank you for the question. Just talking about the first part of your question, which is -- was there a change in the mix? I mean, really the 30% growth that we saw was a composition of two different dynamics. One is the increase in the base business, which Philina mentioned in her prepared remarks. And the other was a shift in the free goods, the number of patients on free goods, which is a temporary shift.

The team did a great job to find a way for the patients who would've traditionally been on free goods in Q1 to get into paid therapy just for the quarter. And so that was a very innovative thing our team was able to do and certainly provided tailwinds in the quarter. But the growth that we saw was, it's very much in line with what we've seen before and there was really no change in patient mix and in line with how we thought about our previous guidance. Philina, do you want to talk about ISM?

[Philina Lee, Chief Commercial Officer]

Yes, so I think I heard your second question is really around how are we targeting providers who have patients in need and what are we doing to activate that urgency to treat and sort of move from symptom directed polypharmacy alone to treatment with AYVAKYT. And so really a key focus of our strategy is to target the highest volume AIs and Hem/Oncs the top 350, as we've talked about are treating approximately 1,500 already diagnosed moderate to severe ISM patients, who today are actively engaging with the health care system, seeing their provider on average a couple of times a year.

In addition to that, we have a substantial armamentarium of tools, right? So every territory is not created equal. And so where there are those high volume centers our ABMs are targeting them. They also have extremely powerful data capabilities as we've talked about in terms of patient journeys that are now equipped for them to be able to see those most severe ISM patients who are engaging with their providers. And on top of that leveraging their local intel and relationships with customers.

The second part of your question, I think was around kind of how to drive that switching, I might reframe that actually as sort of activating for the urgency to treat with AYVAKYT. And again, I think that's really a combination of conveying the burden of disease with providers and there's substantial literature on that front. And secondly really engaging with patients and caregivers to activate them, and let them know when a new treatment option becomes available.

[Unidentified Analyst]

Thank you.

[Operator]

Thank you. Our next question come from Reni Benjamin of JMP Securities. Please go ahead.

[Reni Benjamin, JMP Securities]

Can you talk just maybe quantify a little bit of the provider engagement stats that you mentioned? You talked about grown unaided awareness growing to 40%. Is that 40% of the top 350? I mean, what's the denominator that we should be thinking about? And I guess ultimately as you get closer to launch, is this something that can go even higher to 60% to 80%, or do you think this is kind of plateauing here? And just as a follow-up, can you just give us an update as to how payer discussions are progressing? Thank you.

[Kate Haviland, Chief Executive Officer]

Thanks for that question, Reni. We are really pleased with where we sit today and the receptivity of both the data coming out of Quad AI, and just as Philina mentioned about how physicians are aware of this innovative medicine that is possibly coming to them. But Philina do you want to talk about some of the details on that?

[Philina Lee, Chief Commercial Officer]

Yes, so I think the first part of your question was around the awareness metrics. So again, I think we're just really encouraged to see unaided awareness at 40%. And that's really among the Hem/Oncs and the allergist immunologists, who are actively treating ISM patients today. So including and beyond the top 350 providers, we saw a strong bump in this awareness coming out of Quad AI, especially among the allergist immunologists. And in addition to that, the aided awareness of AYVAKYT is well above 60% at this point. So I would say, it's certainly not plateauing. There's further work to do as we get into sort of lower volume and out towards sort of the tail of treaters and refers.

The second part of your question I think was getting at access and sort of maybe what our expectations are in terms of access with pairs upon launch. So as we've said, based on our payer insights and sort of the current performance of what we see, we anticipate and will be really focused on maintaining strong patient access. Post approval all five doses of AYVAKYT are on the market, including the 25 milligram. And we are certainly seeing strong reimbursement. There's one code for SM as well. So for the small proportion of scripts with ISM that we are seeing today, we are seeing those getting good coverage as well.

[Operator]

Thank you. Our next question comes from Brad Canino of Stifel. Please go ahead.

[Brad Canino, Stifel]

Great. Thanks so much for the question. Congrats on the quarter. I want to ask on the ISM launch, really after meeting with physicians since Quad AI. Hear your thoughts around the preliminary thoughts, I guess around how ISM treatment durations may shape up in the real world? I particularly get questions on the 40% of trial patients that received less than a 30% symptom reduction after a year, and if that cohort in the real world may be at risk for shorter durations? Thank you.

[Kate Haviland, Chief Executive Officer]

So Brad, thanks for your question. And Becker, can you weigh in on that?

[Becker Hewes, Chief Medical Officer]

Yes, I think it's Brad, it's important to remember that that TSS score is not a binary measure. Patients derive benefit on their most bothersome symptom. Sometimes they -- that includes the total TSS score going down. Sometimes it doesn't. But for the most of the patients on the study derive benefit. And what's really important is that patients at all TSS levels have remained on drug for a very long time in the study including the patients that that from part one that remain on after many years.

So I don't think we're in a position yet to say what the duration is going to be. This is going to be lifelong treatment, I believe for many patients. And then we're going to continue to learn of all the ways that that AYVAKYT benefits patients beyond what's measured by the TSS score.

[Kate Haviland, Chief Executive Officer]

And I would just add, Brad, I mean, we've said this before, is that when you see the 96% of patients who are on AYVA in part two roll over into part three and continue on therapy in the context of a clinical trial with having to be part of a protocol. I mean, I think that's really a testament and patients really vote with their feet. We've also mentioned that as we've gone out broadly with this data, the response rate criteria that that we put in place is really not relevant to the AI community. It's certainly something the hematologist oncologists are familiar with, and we certainly have strong data there that we can discuss with them, but AI don't really think about that response rate as a metric by which they think about patient benefit.

[Operator]

Thank you. Our next question comes from Marc Frahm of TD Cowen. Please go ahead.

[Ernie Rodriguez, Cowen and Company]

Good morning. This is Ernie Rodriguez for Mark. Congratulations on the quarter. Thank you for taking my questions. We just have a couple on -- a follow-up on the AYVAKYT bit and the guidance. So you mentioned some of the growth came from a reduction in the percentage of patients on free drug. And I was wondering what drove, what exactly drove that and why do you think it would be temporary? So how should we think about it going forward? And then also wondering if you saw any off-label use of the drug given that we're getting so close to the expected FDA approval in ISM.

And then a second question on guidance. Have you guys determined how you plan to address AYVAKYT guidance once the label is expanded? Thank you.

[Kate Haviland, Chief Executive Officer]

Thanks for those questions and appreciate that everyone has a lot of questions. We're going to try to keep this just given the queue. So maybe I'll answer your last two questions quickly, Ernie, and we can get helpful no way in on, on how we thought about the growth. So no, we do not anticipate providing any additional guidance on upon the ISM approval. It's going to be early days in a launch, the first therapy ever approved in this disease state, so we will not be issuing guidance.

And then we've had very little off-label usage at all, so that that remains the same as it was last quarter. We have a few patients, but not many. So maybe Philina, can you weigh in on how we've thought about the kind of growth and what happened with the free goods patients?

[Philina Lee, Chief Commercial Officer]

Yes, so what we saw this quarter is that half of the growth that we saw was due to a shift to a greater proportion of patients receiving commercial therapy instead of free goods. And so what happens in Q1 is that patients go through a process where they re-verify their benefits and their status. We have a very robust patient support program, your Blueprint, and it's part of that their normal process to help in re-verifying patient status.

In some cases, patients may qualify for additional sources of financial assistance such as third-party charitable foundations. And if they're able to go onto this then they're able to move off of free drug and onto commercial therapy. The resources available here are finite, and so for that reason, we expect this to be a temporary one-time benefit that unwinds over the course of second quarter.

[Becker Hewes, Chief Medical Officer]

So I just also add one comment that it's important to note that AIs don't typically prescribe off-label that they and most of the ones we've talked about are in anticipating and waiting anxiously for the label, but that's not a general trend like it is with Hemo.

[Ernie Rodriguez, Cowen and Company]

That's helpful. Thanks.

[Operator]

Thank you. Our next question come from Dane Leone of Raymond James. Please go ahead.

[Dane Leone, Raymond James]

Hi, thanks. Thanks for finally getting me connected here. So just two for me. Just clarifying that actually the last point that was made there. I think people are just trying to understand the cadence going into the second quarter where obviously you're going to get approval this month. What we should expect with ASM? So to frame it more broadly, you raise your guidance. Obviously you feel confident coming out of the first quarter that things are going well. You're picking up momentum in ASM on the commentary that there's going to be some shift back to patients on pre drug.

Can you maybe just help us frame it a little bit, so we're all kind of more dialed into what we should expect maybe the second quarter Q-on-Q to look like for ASM with all those moving pieces. And then could you just frame quickly for us to your expectations for the 945 plus osimertinib first data we'll see at ASCO, obviously that seems to be a curtain razor for the L858R patient population that will get later in the year. But we would expect to see maybe some initial signs of efficacy between that combination just based on the mechanism of action? So anything there it could be helpful as well. Thank you.

[Kate Haviland, Chief Executive Officer]

Sure. So Mike, maybe you can take the first point that Dane was making just around how to think about Q2 expectations for the core business. And then Becker we'll hand it over to you for ASCO.

[Mike Landsittel, Chief Financial Officer]

Yes. So Dane, yes, so as Philina mentioned, we expect to see continued growth in our AYVAKYT business and growth in in-patient demand, but it's not going to be at the same quarter-over-quarter run rate that we saw in Q1 due to this reversal of the free goods impact that we mentioned. And you could think about it almost as we -- so we've increased our guidance by $5 million, that's approximately what the impact of the free goods was. And so you can almost think about the base to grow revenue off of for Q2 as being like closer to $34 million. And we still expect to see moderate growth off of that going forward consistent with what Philina said. And that is consistent with our increase in guidance.

I think the other important point for Q2 is yes, we are going to be getting anticipated ISM approval. This quarter we expect the ISM impact to be pretty minimal. Where you're going to see the growth for ISM really come in is the back half of the year.

[Kate Haviland, Chief Executive Officer]

And Becker, you want to take the 945 question for ASCO? Yes.

[Becker Hewes, Chief Medical Officer]

Yes. So Dane thanks for mentioning the 945 plus OSI combination. That that is a combination we're very excited about. This is an update on our Phase 1 part of the study. As you know, patients in Phase 1 are heavily pretreated and have quite complex tumors. What we're looking at here is really safety and tolerability of this combination. This is really the first time that that full doses of two EGFR inhibitors with different side effect profiles are being combined.

We look to the activity data to validate that the compounds hit the mutations that they're expected to, and we've shared some of that data in the past. And so that's really the expectation with respect to efficacy in a heavily appreciated patient population. But the safety is what we are focusing on at ASCO.

[Dane Leone, Raymond James]

Great. Thank you guys. Congrats.

[Operator]

Thank you. Our next question comes from Michael Schmidt of Guggenheim. Please go ahead.

[Unidentified Analyst]

Hey, this is Paul on for Michael. Thanks for taking the question. I have one on BLU-451 data at ASCO. Just wondering if you could set some expectations, how are you thinking about the bar for a next gen exon 20 targeted therapy to sort of shift the treatment practice in the second line plus setting? And then maybe if I could squeeze a quick one in on GAVRETO, anything you can share on those potencies that you've initiated to re-partner and sort of how your confidence is in finding a new partner in near-term? That'd be super helpful. Thank you.

[Kate Haviland, Chief Executive Officer]

Yes, so thank you for the question. Becker can take the 451, but maybe I'll just address GAVRETO first. So from a GAVRETO perspective, we are very confident that we will be able to find a great partner for this product. And it is an important medicine that has a tremendous impact on patients with RET-driven cancers, and we've got a lot of interest. And so we're highly confident that we're going to be able to find a great partner for that. And then maybe Becker, do you want to go to BLU-451?

[Becker Hewes, Chief Medical Officer]

Yes, so just to remind everyone, BLU-451 is a compound we acquired for its ability to cross the blood-brain barrier and to hit exon 20 without hitting wild-type EGFR. So to spare patients the toxicity of what we've seen with some of the other compounds. And then to be able to address the most common area for relapse, which is a central nervous system. So we're in dose escalation right now, still escalating. So I'm not -- don't expect an ORR from this early study, but what we are anticipating showing is the level of activity that we've seen. We've already shared that we've seen activity at all of the dose levels. So this will be an update on this and central nervous system activity as we continue to escalate the compound.

[Unidentified Analyst]

Got it. Thank you.

[Operator]

Thank you. Our next question comes from Joel Beatty of Baird. Please go ahead.

[Unidentified Analyst]

Hello, this is Benjamin [indiscernible] on for Joel. Thanks for taking our question. I just had a clarifying question. What's driving the 15% growth in SM-AHN? And then would you expect that to continue? Thank you.

[Kate Haviland, Chief Executive Officer]

Sure. Philina, do you want to talk about the SM-AHN and the work we've been doing there?

[Philina Lee, Chief Commercial Officer]

Yes, thanks for that question. So as you mentioned, we were really encouraged to see 15% growth in the market share into SM-AHN. I think just for context into the overall advanced SM market, it's still a relatively small proportion of the patients who are being treated for their SM and the dynamic there is that most of these patients have SM-AHN and really the education there is focused on the awareness of the SM and the urgency to treat the SM where providers Hem/Oncs have traditionally been attuned more to treating the AHN.

I think to answer your question, primarily there's still a lot of head space because it is still on the order of like just a minority of overall patients who are being treated for their SM.

[Operator]

Thank you. Our next question come from Matt Biegler of Oppenheimer. Please go ahead.

[Matthew Biegler, Oppenheimer]

Hey, good morning. Thanks for the question. So I guess as we think about modeling AYVAKYT sales going forward, assuming the positive PDUFA, and I appreciate you don't want to give concrete guidance yet, but will you break out ISM sales relative to ASM sales? And do you expect to get a separate J code for ISM and is that needed to be able to provide concrete guidance? Thanks.

[Kate Haviland, Chief Executive Officer]

So thanks for the question. So what we've talked about before is that the code for SM is actually the same. So we will not be breaking out ISM versus advanced SM. We certainly have a certain level of insight into that dynamic, but we do not have full visibility just based on the channels through which the product flows.

We will be making sure we've talked about some of the KPIs we'll be using around launch and how to help you all think about the impact of the launch. And that's going to include putting out new patient starts, which we started last quarter, and we've updated here looking at the breadth of prescribers and the activation of new accounts. So those are the types of metrics we'd suggest that people look towards as we think about the health of the ISM launch. Philina, do you want to add to that?

[Philina Lee, Chief Commercial Officer]

Yes, just to jump in and clarify completely agree with what Kate said. Just to clarify, the one point is it's not the new patient starts, but the total patients on therapy with AYVAKYT that we will report going forward.

[Matthew Biegler, Oppenheimer]

All right, thanks.

[Operator]

Thank you. Our next questions come from Ami Fadia of Needham. Please go ahead.

[Ami Fadia, Needham & Company]

Hi, good morning. Thanks for taking my question. Can you talk about some of the physicians that you've identified that are already prescribing AYVAKYT and if you can give us some color on how many ISM patients are under their care and maybe at least qualitatively, how quickly do you see them prescribing AYVAKYT to their ISM patients? Thank you.

[Kate Haviland, Chief Executive Officer]

Thanks, Ami. So I think what you're kind of asking about is how do we think about the dynamics early in launch? Who will be those early adopters and are the physicians who have some current experience, do we expect that to be one of those groups? Philina, do you want to weigh in on that?

[Philina Lee, Chief Commercial Officer]

Yes, so to the first part of your question as we've talked about, there's around 460 accounts, so really good breadth of prescribing for AYVAKYT, for the current indications, which is a great foundation heading into the ISM launch. We estimate that the current prescriber base is managing around 400 already diagnosed moderate to severe ISM patients.

The second part of your question was really around the speed of the ramp. And we expect that to come both from existing prescribers as well as new prescribers, particularly as we are engaging a number of allergist immunologists and have received I think a really excited reception and they are really waiting for AYVAKYT approval. And truly the exact cadence of that ramp is going to be hard to predict, right? So these are early quarters in a first to market new therapy, and so it's always harder to predict those early quarters until we have a couple under our belt. And again, that's why those KPIs that Kate alluded to are going to be so important in tracking the trajectory of our early launch.

[Ami Fadia, Needham & Company]

And maybe a quick follow-up there. So out of these 460 accounts, are all of them mostly sort of oncologists because they are presumably prescribing AYVAKYT to ASM patients? Are they predominantly?

[Kate Haviland, Chief Executive Officer]

Yes.

[Ami Fadia, Needham & Company]

Got it. Okay. Thank you.

[Kate Haviland, Chief Executive Officer]

So the answer to your question is yes, because the current indications are primarily managed by oncology.

[Operator]

Thank you. Our next question comes from Andrew Berens of SVB Securities. Please go ahead.

[Andrew Berens, SVB Securities]

Hi, thanks. Two questions for me. Maybe the first one is for Mike, I know you said the integrating the GAVRETO program wouldn't impact expenses in 2023 and you're trying to re-partner it, but what is the potential impact in 2024 if you have to integrate the program and manage the ongoing trials without a partner? Does your cash runway assume divestiture of GAVRETO and then maybe a question on the CDK2 program, what did you have to add to the trial protocol to have the clinical hold removed?

[Kate Haviland, Chief Executive Officer]

So maybe starting with GAVRETO, Mike, do you want to weigh in on how we're thinking about any additional expenditure and just our discipline around our view on that? And then Becker, we can go to 222.

[Mike Landsittel, Chief Financial Officer]

Yes, I think yes, so Andy like as we mentioned, we're in the process to re-partner GAVRETO now, we feel very confident about how that is going. And that leads to our belief that we will not see any operating expense, incremental operating expense impact this year or in future years beyond what we've planned. If anything, we could possibly see a benefit going forward. So we feel very confident about that position. We don't anticipate any impact on how we guide to our long-term sustainability.

[Kate Haviland, Chief Executive Officer]

Yes, I'll just add to that Andy, this is an area that we have a lot of control over as we think about our operating expenses and what we choose to allocate our capital to and spend on, I know a lot of you have in your models that we're going to be rising significant amounts of money going forward. And again, that that is not our assumption, nor do we intend in any way, shape or form to do that. Becker, do you want to talk about BLU-222?

[Becker Hewes, Chief Medical Officer]

Yes, Andy, part of the reason the hold was listed so quickly is because the changes were minimal and the concern was delayed when we went through the data. So we added baseline ophthalmologic exams for patients, and then if patients had symptoms, they'll get a follow-up. But that was that and the FDA toxicity criteria were the only real additions to the protocol.

[Kate Haviland, Chief Executive Officer]

And you don't anticipate that will change anything around the cadence of enrollment or anything like that?

[Becker Hewes, Chief Medical Officer]

No, there's no change and expected for patient.

[Operator]

Thank you. Our next question comes from David Lebowitz of Citi. Please go ahead.

[David Lebowitz, Citi]

Thank you very much for taking my question. Regarding the change in guidance for AYVAKYT, can we assume that the incremental increases primarily from the one-time charge in the quarter or not the one-time charge, the one-time benefit?

[Kate Haviland, Chief Executive Officer]

Yes, David. That's exactly right. Yes.

[David Lebowitz, Citi]

Got it, got it.

[Kate Haviland, Chief Executive Officer]

That's exactly right. So that's everything else we expect to be the same.

[David Lebowitz, Citi]

Got it. And on the ISM launch, when you look forward, I understand you're not going to, you're not able to give any guidance or anything like that, but when you look forward to the launch, what dynamics should we be attuned for, given the differences between the ASM and ISM population in terms of potential cadence, how long it takes to get a patient from prescription to being on therapy and other such items?

[Kate Haviland, Chief Executive Officer]

So Philina has mentioned there or talked a little bit on the call today already about how to think about that, that ramp cadence and the KPIs, Philina do you want to reiterate that?

[Philina Lee, Chief Commercial Officer]

Yes, I mean I actually, I would start with, I think the biggest difference is really the number of prevalent patients who have already been diagnosed and are really actively seeking treatment and are on symptom directed polypharmacy, right? So starting off with there, they're about 15 fold greater starting patient population for ISM. To your question around cadence, the area we're really, I think most highly focused around is driving that urgency to treat right.

While these patients have significant need and are taking polypharmacy and are still facing limitations on their activities of daily living, their ability to work or participate in family activities, it still is a behavior switch for these patients to move from symptom directed therapy to being treated with a disease modifying agent.

And so that really is one of the core focus areas of our work, engaging both providers and educating them on disease burden and activating the patients. We've talked about the cadence of these patient visits are on average about two times a year. And so this education is really important to maximize the urgency to treat and the decision to treat with AYVAKYT at these visits.

[Operator]

Thank you. Our next question comes from Peter Lawson of Barclays. Please go ahead.

[Unidentified Analyst]

Hi, this is [indiscernible] on for Peter. Thanks so much for taking our question. So it sounds like there is two key dynamics here for the bump in product revenue, both with the free drug dynamics and also some growth in ASM. Could you add a little more color on how much was really driven by organic growth in the ASM market and maybe what we could be thinking about for growth trajectory there for ASM excuse me, for the rest of the year?

[Kate Haviland, Chief Executive Officer]

Yes, sure. So what we said is, so we had a 30% quarter-over-quarter growth. About half was due to the base business growth that, that's in the advanced SM and about half was due to the favorability around the free goods mix. Thanks for the question.

[Operator]

Thank you. Our next question come from Zhiqiang Shu of Berenberg. Please go ahead.

[Zhiqiang Shu, Berenberg Capital]

Good morning. Thanks for taking the questions. First one I want to ask Kate, the earlier comment you made around 25 mg dose strengths is already in the channel. I wonder if you can talk about the significance of that, both in terms of the launch readiness as well as the importance of that metric for you internally and for analyst to track the use of prescribing in ISM patient population. And then the second question is around the CDK2, BLU-222 program. Maybe can you talk about the safety metrics that we are going to see at ASCO and also around the pathway modulation signal you were referring to? Thanks very much.

[Kate Haviland, Chief Executive Officer]

Thank you for those questions. Starting with the 25 mg question, I mean, I think one thing that's really unique about this launch and this opportunity is the fact that AYVAKYT is available and all dosage strengths are already in the channel. They're being covered by payers and that really gives us kind of a very fast out-of-the-gate opportunity and Philina, I don't know if you can add any more color to that?

[Philina Lee, Chief Commercial Officer]

Yes, I mean, I think we've spoken to the access part already. I think that the difference between this and a de novo launch is, if it were a first time launch or a dosage strength that wasn't yet kind of on the market there would be additional lag time needed right upon the label coming in and getting that product into the channel. And that doesn't exist for the situation that we are in.

[Kate Haviland, Chief Executive Officer]

So that's a great strength that we have coming into this launch. So, and then Becker, do you want to talk a little bit about BLU-222 and what do you expect from a safety like what are you looking for from a safety perspective?

[Becker Hewes, Chief Medical Officer]

Yes, so just a reminder, BLU-222 was designed and selected to be highly selective, such that it hits CDK2 but does not hit CDK1. And when you hit CDK1, you can get hematologic and gastrointestinal toxicity. So really showing that we're in an active range without seeing that type of side effects going to be important both as a single agent and when we think about combination with ribociclib. And then your second question was about what to expect in the biomarker front. What I'll say is that we have both circulating and tumor-based biomarkers and we look to show at various doses modulation of that to ensure people that this is a bonafide CDK2 inhibitor that has a pretty wide active range.

[Operator]

Thank you. There are no further questions at this point. Ms. Haviland, I'll turn the call over back to you.

[Kate Haviland, Chief Executive Officer]

Thanks operator and thank you all for taking the time to join us today and for your continued support of Blueprint Medicines. It is going to be an exciting month for us and we really look forward to talking to all of you again soon. And given that it's May 4th, I'd be remiss to not end the call by saying May the Force be with you for all the Star Wars fans out there. So again, look forward to talking to you all hopefully in a couple of weeks.

[Operator]

Thank you. This concludes today's conference call. You may now disconnect.