Blueprint Medicines Corp

NASDAQ:BPMC

Earnings Call Transcript 2020-Q2

[Operator]

Ladies and gentlemen, thank you for standing-by. And welcome to the Blueprint Medicines Second Quarter 2020 Financial and Operating Results Conference Call. At this time, all participants are in a listen-only mode. After the speakers’ presentation, there will be a question-and-answer session. [Operator Instructions]

I’d now like to hand the conference over to your speaker today, Kristin Hodous of Blueprint Medicines. Thank you, please go ahead.

[Kristin Hodous, Senior Manager, IR]

Thank you, Operator. Good morning, everyone. And welcome to Blueprint Medicines second quarter 2020 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 Investors section of our website at www.blueprintmedicines.com.

Today, on our call, Jeff Albers, our Chief Executive Officer, will discuss Blueprint Medicines second quarter 2020 business highlights; Christy Rossi, our Chief Commercial Officer, will provide a commercial update; and Mike Landsittel, our Chief Financial Officer, will review our financial results; Dr. Andy Boral, our Chief Medical Officer is also on the call and will be available for Q&A.

Before we get started, I would like to remind everyone that statements we make on this conference call will include forward-looking statements. Actual events or results could differ materially from those expressed or implied by any forward-looking statements as a result of various risks, uncertainties and other factors, including those set forth in the Risk Factors section of our most recent quarterly report on form 10-Q filed with the SEC and any other filings that we make with the SEC.

In addition, any forward-looking statements made on this call represents our views only as of today and should not be relied upon as representing our views as of any subsequent date. We specifically disclaim any obligation to update or revise any forward-looking statements.

Now here's our CEO, Jeff Albers.

[Jeff Albers, CEO]

Thanks, Kristen, and good morning everyone. I'm happy to provide an update on what has been a productive quarter for Blueprint Medicines. At beginning with the year, we talked about how 2020 was shaping up to be transformational for Blueprint Medicines as we evolved into a fully integrated precision medicine company. And it certainly happened given the achievements we've made against our goals over the first half of the year.

Let me highlight how this progress sets us up going into the second half of the year across our three areas of strategic focus. First, establishing our commercial foundation with AYVAKIT, which we will now harness for [indiscernible]. Second, prioritizing systemic mastocytosis given the significant medical need, and third, leveraging our discovery platform to advance future pipeline opportunities.

I’ll start-off with a strong U.S. AYVAKIT launch for the treatment of patients with PDGFRA alpha exon 18 mutant GIST. As Christy will discuss in a moment, we've gained critical commercial experience, and it built a nimble and highly effective team along with infrastructure to deliver our products to patients. Our early experience for the AYVAKIT gives us a strong foundation for our planned launch of PDGFRA exon 18 mutant in the coming months, which will have the amplified as we integrate the capabilities of our new partners at Genentech and Roche.

We're also capitalizing on our AYVAKIT experience outside of the U.S. Just a few days ago, we received the positive CHMP opinion for avapritinib for the treatment of patients with PDGFRA alpha D842V mutant GIST. This achievement sets us up a final decision on our marketing authorization application by the end of this quarter.

Assuming avapritinib is approved, we expect to initiate our first commercial launch in Germany, with additional European countries to follow. Additionally, as in the U.S., we expect this initial launch will lay the foundation for future systemic mastocytosis commercial efforts as well.

Building from commercial readiness, our second strategic area of focus is the great progress within our systemic mastocytosis program. We believe SM represents the single largest opportunity across our clinical stage portfolio. The significant medical need combined with our differentiated approach of potently targeting the SM disease driver opened an opportunity advance in new treatment paradigm.

Earlier this year, we reported very encouraging data from Part 1 of our PIONEER trial of avapritinib, the patients with indolent systemic mastocytosis. Based on these data, we selected 25 milligrams once per day as the recommended dose and finalized the design of the registration labeling Part 2 with input from Regulatory Authorities. And today, we're pleased to announce that we've initiated Part 2 of this trial.

Later this quarter, we plan to report top line data from the EXPLORER and PATHFINDER trials of avapritinib in patients with advanced systemic mastocytosis. The combined data set, which will support the submission of a supplemental new drug application to the FDA in the fourth quarter, will include response assessments for approximately 50 patients starting at the recommended 200 milligram once daily dose.

Additional data supporting the submission will include response kinetics, including the time to response and the duration of response, objective measure readouts such as serum tryptase, and mast cell burden and updated safety results across the broader trial populations.

Finally, a robust discovery platform continues to provide broad opportunities for future growth. Earlier this year we nominated a first-in-class development candidate BLU-945 for triple mutant EGFR positive non small cell lung cancer.

This program combines potent inhibition of treatment resistant triple mutant EGFR, with selectivity over the wild type kinase, highlighting the ability of our scientific platform to continue to address challenging target product profiles.

At the Virtual ESMO Congress in September, we plan to present new preclinical data for BLU-945 as well as share an update on our plans to bring this therapy into the clinic early next year. Importantly, the triple mutant EGFR program is just the – our first of after three new development candidates we hope to nominate by the end of the year. Our progress across these areas laid the foundation for significant growth for Blueprint Medicines as we continue on our path to become the world's leading precision medicine company. We look forward to updating you on these critical data and regulatory milestones over the coming months and into the second half or throughout the second half of the year.

And with that, I'll now turn the call over to Christy to provide an update on our commercial efforts. Christy.

[Christy Rossi, Chief Commercial Officer]

Great, thanks, Jeff. And good morning, everyone. I'm happy to share an update on our commercial progress, including our first full quarter of AYVAKIT sales and PDGFRA alpha exon 18 mutant GIST. And our ongoing preparations for the planned launch of pralsetinib.

Through the first half of 2020, we have been focused on establishing the foundation that will support multiple anticipated global launches in the coming years. With potential near-term approvals of pralsetinib in the U.S., and avapritinib in Europe, we are truly excited to be on the path of delivering a portfolio of precision therapies that address significant patient needs. Of course, the successful launch of AYVAKIT has been the essential first step on our journey towards realizing this goal.

In the second quarter, we generated $5.7 million in net sales or $9.1 million since launch, driven by strong execution against our launch strategies. We quickly established Blueprint with key oncology and hematology centers of excellence and other stakeholders that are critical not just for our initial launch in GIST but for pralsetinib and systemic mastocytosis.

We achieved broad access for AYVAKIT rapidly and we continue to see strong patient access in line with or better than our label. By focusing on clinical education, and individualized patient support, we have ensured that prescribed patients can start on treatment quickly and also remain on treatment as long as it is clinically appropriate. And I've been particularly pleased to see that refill rates have been high suggesting that our real world duration may exceed those seen in our clinical studies.

Finally, last quarter, I noted that I was encouraged to see strong breath of prescribing upon launch. This trend has continued in Q2 fueled by the efforts of our seasoned field team. And we continue to add new prescribers with approximately half now coming from the community setting. I've noticed before the significant overlap between GIST and lung prescribers in the community, and this has enabled us to advance our profiling and disease awareness efforts as we prepare for the next chapter in our commercial evolution, our anticipated launch of pralsetinib.

As I’ve shared before, we plan to deliver a best-in-class RET inhibitor to patients, focusing on our differentiated clinical profile, including deep and durable responses, a predictable and manageable safety profile and once daily dosing. We will be launching with a patient and healthcare provider centered approach that recognizes the importance of community oncology centers. And a highly experienced team for whom this is the top priority.

I was confident in our ability to launch before we entered into our transformative partnership with Genentech. And as we started to engage with our colleagues there to implement this collaboration, I could not be more excited about the power we will bring across our two organizations. While Blueprint will be driving launch efforts, we are already working to integrate with Genentech and identify near-term opportunities for them to amplify and extend our efforts. For example, by leveraging their substantial diagnostic and data capabilities, in addition to the experience of their team.

As we prepare for the launch of our second medicine in a single year, we are well positioned to maximize the opportunity for pralsetinib. With a differentiated product profile a focused and nimble team that is amplified by a strong partner and a foundational infrastructure from our experience with AYVAKIT. We are thrilled with our commercial preparation and execution thus far. We are well on our way to building a best-in-class commercial organization to effectively deliver multiple precision therapies to patients.

I'd now like to turn it over to Mike to discuss financial updates.

[Mike Landsittel, CFO]

Thanks, Christy. Earlier this morning we reported detailed second quarter 2020 financial results in our press release. For today's call, I'll touch on a few financial highlights from the quarter. As Christy mentioned, we were pleased to record $5.7 million of AYVAKIT net product sales in the second quarter. Cost of sales remained low as we continue to work off inventory of AYVAKIT that we expense to pre-approval.

Our total operating expenses increased slightly compared to the prior quarter. It's driven in part by an increasing stock-based compensation expense. Looking forward in light of our global collaboration with Roche, we expect to see quarter-over-quarter expense growth stabilized for the second half of 2020 as savings through the cost and profit sharing arrangement with pralsetinib offset planned increases in R&D investment in systemic mastocytosis and our discovery portfolio.

We do anticipate continued increases in non-cash stock-based compensation expense for the foreseeable future. With over $1.4 billion in cash after including the upfront payments from our Roche collaboration, we are in the strongest financial position that we have ever been as a company. Excluding the upfront payment from Roche, we anticipate the potential for additional revenues of up to $80 million in the second half of 2020 from a combination of milestones from our multiple collaborations, and product sales. We also received an additional $20 million in cash in July from our collaboration with Clementia for BLU-782 that was previously recognized as revenue in Q4, 2019.

Between our collaborations and future anticipated product revenues, we now have a clear pathway to financial independence and enhanced flexibility to invest more in multiple high value opportunities across our portfolio. We are in a unique position for a company of our size and age, and we're looking forward to sharing further updates with you as we continue to make progress across our portfolio.

With that, I’d now like to turn the call over to our operator for questions. Operator.

[Operator]

[Operator Instructions]. Your first question comes from Salveen Richter with Goldman Sachs.

[Unidentified Analyst]

Hi, everyone, this is [Andrea] on for Salveen and thanks for taking the question. My first one is may be for Jeff, can you just remind us the expectations on timing for patient screening enrollment for Part 2 of the PIONEER study and when we might see data and then I have a follow-up question.

[Jeff Albers, CEO]

Sure. So this is Jeff. On PIONEER, we talked about this at the last quarter call that we've now initiated the study and then continue to see a lot of enthusiasm from sites that were involved with Part 1 as well as some new sites coming on that are going through the screening process. We have not guided to timing readout as a reminder, we plan to enroll 200 patients, but we want to see how that the site initiation and impact of COVID plays out and not just in the next few weeks, but also over the coming months. So do have a better handle on the consistency with which sites are staying open. We're going to hold off on providing that guidance.

[Unidentified Analyst]

Got it? And then maybe just a second question for Christy. How should we think about the cadence of hiring for the AYVAKIT launch both in the U.S. and then expected in the EU? And then can you speak to the progress of how you guys have been incorporating the Roche team in preparation for pralsetinib? Just maybe some actions that have been taking place there?

[Christy Rossi, Chief Commercial Officer]

Sure. So the first question was on AYVAKIT in the U.S. and EU. The U.S. team, as I said before, for AYVAKIT is in place has been in place since launch. And in fact, that team has really built with a portfolio focus in mind. So that team will be driving the pralsetinib launch and really all along are our primary priority with that team has been very much focused on preparing for and launching pralsetinib. And so we're going to see that team's primary focus really shifts currently it's been a disease education and profiling and then upon launch will be focused on driving promotion for pralsetinib.

For Europe, we have a small focused nimble team in place in the countries that we anticipate near-term launches, the focus of that team will be on driving the initial AYVAKIT launch. And because that market is very focused at a number of treatment centers with whom we already have relationships, we believe that we can target that market effectively with a small and nimble team. And then that team will have the foundational infrastructure that will prepare for an eventual SM approval on Europe.

[Jeff Albers, CEO]

And Christy, the second part was the integration with Roche.

[Christy Rossi, Chief Commercial Officer]

Oh, sorry. Yes, so the Roche team, as I said has been very involved in these initial weeks and we'll announce the collaboration due to the proximity of what we anticipate to be an imminent approval for pralsetinib. Certainly Blueprint will be driving many of the launch efforts, but we've already identified ways for Genentech in the United States to come in and it’s really amplify our efforts, particularly around patient identification, leveraging data helping to drive testing as an example. And then clearly just leveraging the power of their portfolio of targeted therapies, which into pralsetinib [indiscernible]. So, we're still working through specifics on some of the details on roles and responsibilities, but have identified a number of ways where they think they can come in and really help us out of the gate.

[Unidentified Analyst]

Great, thanks so much.

[Operator]

Your next question comes from the line of Peter Lawson with Barclays.

[Peter Lawson, Barclays]

Hi, thanks. Thanks for taking my questions. Just on the RET space. Just point of what you're hearing from physicians regarding the better CR rates and like [indiscernible] prolongation versus glucose molecule and when they were kind of hearing mixed messages, so it’s great to understand what you're hearing?

[Jeff Albers, CEO]

Yes, this is Jeff, I'll start and then Andy and Christy can way in. We think it is very encouraged by the data that we've put out most recently at ASCO. And in response to that, as you know the consistency of activity, we're seeing deep and durable responses to notable CR rates, which, for ready positions are something that they're very encouraged by and they'll want to see how does that translate into [ready] response over the longer term. And then a predictable safety profile that Andy noted in his opening comments that particularly push out the community and what we hear is physicians want -- are much more comfortable with -- at side effects that may manage historically aired consistent with other therapies. And the more unusual and adverse event the more that have an impact on what they're going to -- how they're going to treat. So, there's obviously differences when we look at the academic sites versus the [immunity] sites, but overall, we think we have a very promising profile with pralsetinib.

[Peter Lawson, Barclays]

Got you. Thanks.

[Andy Boral, Chief Medical Officer]

We've talked to you a lot of both our investigators and other kind of community and now in theory, I think repeatedly comes back as a distinguishing characteristic and we done a bit more in Q2. I think the hardest thing about things like [QT] prolongations that restricts the use of other medications that the patients often need just for general supportive care, antibiotics, antiemetics, and so we just not having to worry about that is a real advantage.

[Peter Lawson, Barclays]

Great, thank you. And then just on the launch dynamics, and which we look at is that the RET/Raf-1, or ERK and what are the best proxies here and what are the color the puts and takes versus those other launches?

[Jeff Albers, CEO]

Christy, do you want to take that?

[Christy Rossi, Chief Commercial Officer]

Sure. So, I think all of those analogs are helpful. None of them are perfect, right. So I think certainly a driver, I think that many are often interested and is just sort of the acceleration of testing and patient identification. And so, if you look historically at other targeted therapy launches of lung you tend to see a ramp of testing practices that is driven by the availability of effective therapy. And I think those -- that ramp has become more accelerated with recent piece of launches this space has really shifted towards utilization of testing more broadly. We'd expect a similar dynamic with RET and certainly having potentially two agents on the market is very helpful in that regard, right. It's really drive testing practices. But obviously those each stages slightly different in terms of the frequency of the mutation, the number of players in the space et cetera. So we are -- as Jeff said really excited and enthusiastic about getting out there with pralsetinib and looking forward to you hopefully having that available relatively soon.

[Peter Lawson, Barclays]

Great. Great, thanks.

[Operator]

Your next question comes from the line of Marc Frahm with Cowen and Company.

[Marc Frahm, Cowen and Company]

Hi, thanks for taking my questions. Maybe just follow up on an earlier question about the IFM trial. Jeff in the past – Jeff in the past you kind of talked about a backlog of patients as you were waiting to select a dose and things like that. As you've activated sites, have you seen to have a bolus of patients coming in from the sites as they come online, like you would have expected or you already kind of seeing a little bit of reluctance from patients to come into the clinic even the pandemic?

[Jeff Albers, CEO]

Yes, so this Jeff Albers. I think that's too early to say, I mean if every site is unique, I find that I often think broad sort of the U.S. versus Europe. And then I'm reminded that Massachusetts is different than Nebraska. So what we're seeing is, there is clearly demand and that that really underlies our continued push that systemic mastocytosis is the biggest opportunities that that we're focused on. And, provides really meaningful upside as you think about patients not only being treated and identified, but in staying on for a long period of time with a targeted therapy, like avapritinib.

So I think that that thesis is completely intact, as we see that then play out, site-by-site. I think there's going to be some variability. We have sites that definitely have backlogs and how we are going to manage that. And when how often patients come in is it varies by investigational site we're seeing. So we just need to work through that and that's why we feel like it's inappropriate to provide specific guidance. We know notwithstanding a pandemic, the demand is there and we will continue to see these patients enrolled, we're seeing patients already lining up to come in. So even with the pandemic, that there's a medical need high enough that we're going to enroll these patients, but that -- how that will exactly play out when you think about 20 sites to 30 sites. I think there's going to be variability. Andy?

[Andy Boral, Chief Medical Officer]

I think you framed it well, Jeff. As we talk to our investigators, there's they really do have a list of patients that they're looking at it and it's just it really is a matter of in Florida now versus Massachusetts versus somewhere else in the country. It's just -- it's a bit of a moving target when people in different places feel comfortable coming into the health care centers in the setting of them not having a life threatening disease, but we think it's okay.

[Marc Frahm, Cowen and Company]

Okay. And then maybe a quick one on AYVAKIT, so Christy, just in the past, you mentioned seeing demand, both in PDGFRA as well as outside of PDGFRA. You're following the VOYAGER trial results? Have you noticed the definite change in the new patient start trajectory as maybe demand outside of PDGFRA shrink?

[Christy Rossi, Chief Commercial Officer]

Sure. So as I’ve said, we see utilization of across it, it's difficult to say precisely what the patient breakdown looks like between PDGFRA alpha and other GIST patients, even mutation status is not something that you can kind of pull consistently and so you're sort of relying on what you just may learn organically about these patients.

Either I can say that we're continuing to see both prescribers added as well as new patient starts. And I -- we're seeing them across that we're seeing them in PDGFRA alpha as well as and mutant GIST. Clearly our focus is on PDGFRA alpha, which is where the drug is labeled.

I think going forward, certainly you've got a number of dynamics to play right now, you've got COVID, you have avapritinib now approved. So, I think all of those will factor in, but I would continue to expect to see new patients demand, both in PDGFRA alpha as well as outside of that. I mean, we know that those patients that very significant need there, and current therapies even with the approval of pralsetinib that that need remains

So I think we can expect to see that on an ongoing basis. Of course, for our team the focus, as I said, for the second half of the year, will really be primarily from a demand generation perspective, focused on pralsetinib and then of course starting to prepare for what we hope will be a launch and that’s the fact.

[Marc Frahm, Cowen and Company]

Okay, great. Thanks.

[Operator]

Your next question comes from the line of Diane Leone with Raymond James.

[Unidentified Analyst]

Hi, this is Dane calling in for Diane today. I think he will be back tomorrow. Congrats on the update. Two from me, firstly on the advanced SMs, how do you think about having the pivotal data set in hand at the 200 mg QD dose? And how that could update the label for avapritinib? The specific to that question is, right now you have a label that was all encompassing for AYVAKIT to be approved of the data you had from a safety perspective across both SM and GIST, but you're going to have a more specific update for safety at the 200 mg dose which I think a lot of us expect to have a lower event rate and have more dynamics around how to manage some of the thrombocytopenia, clinical supplies. So what are your thoughts of how we could see FDA label updates that would help inform clinicians? And actually better characterize the actual dose that you think should be used for ASM?

[Jeff Albers, CEO]

I will take that one. So usually, I think that it will be laid out at the 200 mg dose, very typically in both U.S. and EU labels, when new indications get added, there's a safety section on the study that supported that that indication and I would fully expect that we would have a description of the safety at the 200 mg dose, similarly, I mean, obviously, we're forward looking here and depends a little bit on well, yes, he is thinking but they could might -- they might also have some sort of integrated analysis that cover so.

[Unidentified Analyst]

Okay, and would there be other additional language you think on platelet count and management of symptoms or any like guidance included in the label from that perspective, that would be updated?

[Jeff Albers, CEO]

Well, I think there will be guidance on platelet counts in the label. I mean that we would actually want because we think it's really important to have patients with severe thrombocytopenia have that dealt with before they get AYVAKIT when they have systemic mastocytosis, so I'd expect there will be a separate description of guidance for patients with advanced SM.

[Unidentified Analyst]

Great. And the second one for me is can you give us a status update on BLU-263?

[Jeff Albers, CEO]

Yes, so that, as we said previously, the study, the first human health volunteer study has started and it's moving along. It's an ongoing public volunteer site. So we don't have any specific information to provide at this time, but it's enrolling as expected. Actually I think that's an area where we're really pleased where I think that was the areas where I thought that the COVID-19 could be a problem, but the site really came together and figured it out and has kept things on track.

[Unidentified Analyst]

Great, and have you given a timeline of when we see an update on when not programs going to progress or initial person human results?

[Jeff Albers, CEO]

Yes, we haven't given a specific guidance on that. And as the study evolves [indiscernible] plan, but yet not.

[Unidentified Analyst]

Okay, great. Thank you guys.

[Operator]

Your next question comes from the line of Michael Schmidt with Guggenheim Securities.

[Unidentified Analyst]

Good morning, guys. This is Charles on from Michael Schmidt. Thanks for taking the questions and congrats on the quarter. First, with respect to ongoing avapritinib commercialization and the impending launch, it looks like you guys do have a nice emphasis on a community setting. So I was just wondering if you could provide some additional color on not only perhaps the potential synergy between GIST and RET, but also, I guess some detail around your current presence in the community setting. And what this Roche partnership could potentially bring to that, for example, between your EXPLORER between a [indiscernible] versus non [indiscernible] EMR practices?

[Jeff Albers, CEO]

Christy, do you want to take that?

[Christy Rossi, Chief Commercial Officer]

Sure. So the community has been a focus of ours out of the gate. And, we know as long that upwards of maybe 70% of patients are treated in a community setting. I think way back when we talked about sort of the overlap that we see between prescribers for just as long being 60% plus and so these are centers that our team has established a presence with and is actively engaging for AYVAKIT. And then as I said, as really focused on driving disease awareness for pralsetinib and anticipation of that launch. When I think about our colleagues at Genentech, I think again, they can really help to amplify and extend those efforts.

Certainly, the data patient identification is a piece of that. But I think it's also just the breadth of the team that they have, and really being able to compliment our efforts and getting out of reaching into the community setting. And when I talk about, an approach that prioritizes the community, for me, it really goes beyond just the engagement that our sales team, for example, they have there, we really believe that making the process of prescribing as seamless as possible for [indiscernible] oncology it could be really critical.

We are launching with a strategy that supports not just prescribers but also many oncology pharmacies and their ability to really maintain the management and care of their patients, which we know is something that's really important to them. And so it's really a 360 approach. I would say that that we're bringing to the community setting.

[Unidentified Analyst]

Got it. Thanks for that detail. And my next question regarding avapritinib and the BLU-263 and they want SM, I just also kind of wondering to what extent could a current or longer term safety signals from AYVAKIT and ISMB use to either inform or potentially even supplement future efforts and data collection for BLU-263 and also as a related follow up, do you see any, I guess potential differences in patients remaining on therapy given potentially ISM patients will see that there's symptoms resolving but maybe healthy volunteers will not in that be kind of a less motivating factor to stay on therapy.

[Jeff Albers, CEO]

Andy, so maybe I’ll the last one, so the healthy amount of study is a very time limited study really to assess PK safety and establish the best starting dose for the patient's -- there's not really an issue there, though they'll stay on for the short period of time they need to get those days out. And I think there is a real opportunity that bring to the preferred offers is that -- is when we do think that that shouldn't have really any potential for the cognitive effects that we have seen avapritinib high doses. We are very happy with the [daily] at 25 milligrams with avapritinib, where [indiscernible] has not been an issue, but I think certainly there is -- in theory, there's potential that over many years if someone gets paid a premium for 5 or 10 years, I suppose it's possible that those thing can emerge and that's the kind of opportunity then that BLU-263 offers to resolve, or the kind of problem that resolve. Again, though we still emphasize more with BLU-263 moving into even less advanced forms of systemic mastocytosis where it's maybe more the -- more with what the more what it solves is the theoretical concern that may not even exist there about just because of the data and the higher doses.

So that we are still looking at it as a compound that was develop initially in less advanced forms there. And more at a higher level, I know I've talked about this before, but if we've made it very clear that systemic mastocytosis is our priority, and it fits perfectly with our strategy of going after very targeted patient populations with an exquisitely selective inhibitor and we've got a monogenic driver [DA 16 mutations]. In this case, it's the intersection of oncology and rare disease and when we made this decision to move forward BLU-263 we looked at this as we're operating from a position of strength. And let's double down on that. And as Andy just highlighted, we think it's a way to extend that that reach -- our reach and position.

And so we don't know exactly where it will be needed. We continue to be highly encouraged by the emerging data we're seeing with avapritinib both of the 25 milligram and 200 milligram doses. And we are investing heavily there. We're focused there. And I think that really is what underlies the strength of Blueprint right now.

[Unidentified Analyst]

Very helpful. Thanks for that detail and congrats again on the quarter.

[Operator]

Your next question comes from the line of David Lebowitz with Morgan Stanley.

[David Lebowitz, Morgan Stanley]

Thank you very much. With respect to advanced SM [technical difficulty] data they had given last year I recall you originally [technical difficulty] PATHFINDER, if you, I guess, updated us the data that was in the past and what we're looking for I guess incrementally Jeff, [indiscernible] issue?

[Jeff Albers, CEO]

Sure. So you broke up a little bit in the beginning, but I think I captured that the GIST of it, which is around the emerging advanced SM data and a reminder of where we were previously. So, there's a couple of things that play. First thing is the most important piece is that, the data we've shown to-date in advance SM has been very consistent in terms of high response rates or disease control rates. The objective measure waterfalls, we’ve shown virtually all patients seen a data set and what the way the -- our trials have emerged is that we've now blended two different trials because of the unusual nature of the IWG response criteria mean baseline which was not built into our Part 1.

We've used, we move forward with multiple doses where we've pushed up more towards GIST like dose 300 milligrams, but then focusing on 200 milligrams given that we were seeing similar response rates or the same response rate as 300, but it just took a bit longer for that to emerge, but with the [indiscernible] safety profile, so there was a compelling intersection at 200 milligrams that you get to the same point eventually.

And with fewer adverse events, and when you're thinking about chronic treatment, that's important. And then we have changed the exclusion criteria as we identified thrombocytopenia as a risk factor, and so it was really the blend of all of those that went in interactions with Regulatory Authorities. They said it's a pretty clear cut that is -- there is strong efficacy here. And there's a manageable safety profile. But we're looking for a more homogenous, if you will, if -- focus groups thinking about the number of patients who are at 200 milligrams per se, across those two trials, and so we agree to aim for about 50 patients at the 200 milligram starting dose. But obviously, all of the data regardless of starting dose from the two trials will be part of our data submission.

I think, to your second part your question, which is what did we show before which is anywhere -- I think it was 70%, 70 something percent response 77 -- 77% response rate. Yes, but there's a lot more to data that I think [indiscernible] exactly what was shown at that previously, but I think the important factor is, is this was really more of a function of time to have a data set that that a regulatory agency could focus in on at a starting dose.

And we view that, frankly, the passage of time is more of as sounds pity, but as [indiscernible] on that we wanted to get to that point where we had enough patients, but we're very confident in the data that we'll be putting forward. I think it is transformational in nature for these patients.

And then again, going back to PIONEER, we think we're just getting started. And that this is an area where there, it's clear that there is need, it's clear that a lot of patients are misdiagnosed. And it is clear that it's really a continuum of disease with one driver. And so this isn't these subgroups tend to blend together. And we'll be focused on identifying patients there over the long-term, both within our clinical trials but then beyond that commercially.

[David Lebowitz, Morgan Stanley]

Thank you for taking my question.

[Operator]

Your next question comes from the line of Reni Benjamin with JMP Securities.

[Reni Benjamin, JMP Securities]

Hey, good morning, guys. Thanks for taking the questions and congratulations on the quarter. I guess maybe just starting off, can you talk a little bit or provide some more color regarding the patients that are receiving AYVAKIT, are these majority in the frontline setting, accurate diagnostic testing or are they still receiving kind of standard-of-care and then primarily obtaining this more in the last line settings, just any sort of color to the patients?

[Jeff Albers, CEO]

Christy, do you want to take that?

[Christy Rossi, Chief Commercial Officer]

Sure. So, again, our insight at a patient-by-patient sort of basis is not perfect. So I would start with that caveat, I think what we saw at launch was certainly that there were PDGFRA alpha patients sort of identified who came on to therapy relatively quickly, those patients often had been treated with other therapies prior to receiving AYVAKIT, we're continuing to see new patients come on, and I would, from what we can see, I think that's shifting a bit to patients who are being identified and diagnosed with PDGFRA alpha mutation and then immediately going on, right.

So that's a mix of patients, certainly in academic centers where testing is more regularly done and it's done earlier on when that patient comes into the center. You might see them come on earlier, but often it takes patient referrals to get there. And so, that that I would say that in the U.S. PDGFRA alpha patients are predominantly not being identified certified at diagnosis, they're still often being treated with that one of our therapies before receiving it, but again, it's a mix.

[Reni Benjamin, JMP Securities]

Got.it. And then just regarding pralsetinib, has there been --I'm sure before the deal was done there was an extensive review. But is there a plan now to have an extensive review regarding the process of developing program? And kind of what's the current status of that? I think so the comp general pralsetinib is still planned. I think you mentioned during the previous call that you're evaluating other combinations, can you give us a sense as to when we might have a better sense as to how this entire development program is floored?

[Jeff Albers, CEO]

Sure. This is Jeff. I'll start with that. So you're correct that in both regards. Yes, obviously there were a comprehensive review of all of the data and looking back as well as all the plans looking forward. The team as much as -- Christy, just highlighted how the Genentech and Blueprint Medicines, commercial teams are already working together and frankly have already started sharing information prior to the signing of the agreement. The clinical teams have been doing the same.

We're looking at what is that longer term clinical development plan that both companies would recommend and how would that come together. Encouragingly, the forward looking plans were very similar. And so now through during the collaboration, the teams are coming together and they'll no doubt see some changes in one of the -- one I'm most excited about is that there will be a condensing of time, and on many other things that at Blueprint, we will -- likely would have done sequentially, where now there's the opportunity to do several things simultaneously. But if we were to work through those with our partner, and then in terms of when -- how we'll update that -- that will also flow through the collaboration in terms of how much is disclosed, and when that's disclosed, but it is a robust development plan.

[Reni Benjamin, JMP Securities]

Got it. And then just maybe one final question for me. I think the pipeline -- the upcoming pipeline gets overlooked a lot. And there's a lot happening here. Can you just remind us, I think, last one of my notes has like 8 programs that are underway, 4 of which are wholly owned, can you maybe just help us focus on what are the key ones? Obviously, we have the data coming out from 945s, the preclinical data but the other programs that you think are important that we should be keeping on our radar screen?

[Jeff Albers, CEO]

Sure. So I would combine the two EGFR resistance programs that we've disclosed at R&D Day last year. 945 being the BBB, and then we have a double mutation program that would be one that we are focusing on the on target resistance that would emerge or somewhat it moves into a first line setting.

So those are two, we've guided to having up to three development candidates by the end of the year. So BLU-945 is one of those. So there's two other programs that have made very nice progress and we're feeding for having development candidates and as that occurs, we would provide updates thereafter.

Another bucket is our cancer immunotherapy collaboration with Roche. So we had highlighted in our [indiscernible] is one of programs in that collaboration, that that continues to make nice progress in their additional programs and that remain undisclosed there. And then there's a grouping at additional undisclosed programs at various stages in preclinical development. And so when I took all that together, and we fundamentally agree that it's an area that's overlooking that and we appreciate why that, there's a lot of excitement with our lead programs. But when I think about this moment in time, and we talked a bit about this, when we announced the collaboration [indiscernible] medicine is the strongest position that's ever been made.

I think oftentimes, it's overlooked how difficult it can be for new biotech to build a fully integrated business. We now have that capability. So we've got Christy leading those commercial efforts and have generated a lot of the questions this morning. Out on the front end, I can take it as a team that is chomping at the bit to get moving with pralsetinib in earnest in pending regulatory feedback. We'd now strengthen that with a partner who that we consider to be one of the best when it comes to targeted therapies. It's certainly supplementing our efforts in the U.S. But then globally bringing profit net to more patients globally, in a faster timeframe. That collaboration now allows us to focus more of our energy on systemic mastocytosis, which we think is the biggest driver in long-term value for patients and for us.

And then it has also that freed up resources for us really to focus on what we think is a underappreciated promising pipeline. You don't get many moments like that, where all three of those factors can come together simultaneously, and backed by a strong financial position. So I think it's up to us now to convince you that there is value in that pipeline, but I think we've got a plan to methodically roll that out over the coming years. And there's a lot to be excited about in that pipeline.

[Reni Benjamin, JMP Securities]

Great. Thanks for taking the questions.

[Jeff Albers, CEO]

Thank you.

[Operator]

Your next question comes from the line up at George Farmer with BMO Capital Markets.

[George Farmer, BMO Capital Markets]

Hi, good morning. Thanks for taking my questions. Could you guys remind us how much follow up data you'll have in the advanced SM setting when you ultimately present the data and file with FDA? And also, could you comment on how your patients are doing in Part 1 of the EXPLORER trial have they all moved on to long-term extension and what sort of data do you need from that in order to secure approvals and both indications?

[Jeff Albers, CEO]

So maybe I'll start with that and then Andy can jump in so, in terms of the additional follow up, so it'll be a blend of a couple of things. So, One is, we provided hotline data late last year. So just as a function of time for patients who had already been enrolled, you expect it to be somewhere in the six to nine months of additional follow-up. Of course, there's also new patients that we've not [indiscernible] on those. So by definition has less follow-up many of them will have been enrolled or late last year.

And I can't remember if it I think that the enrollment for -- from a regulatory perspective, all of those patients have been enrolled when we provided that top line so they would have all been enrolled as of last year. So let's follow up from an IWG criteria that really matters, because a part of the definition of response is a component that of time of how long they've been in response. And then we'll blend it together in terms of -- the second part of the question which is --

[Andy Boral, Chief Medical Officer]

[indiscernible].

[George Farmer, BMO Capital Markets]

Yes. Yes PIONEER.

[Jeff Albers, CEO]

Yes, so that Adam, those patients all COVID have gone into what's called Part 3 of the study that we've discussed, which is a long-term follow-up to me and they're given specific data from that part of the study but they continue to do well.

[George Farmer, BMO Capital Markets]

Okay, great. Good. And then question from Mike. How are you thinking about accounting for the upfront payment from our [indiscernible] incorporate that into our models?

[Mike Landsittel, CFO]

Yes, sir. So we're working through finalizing the accounting with our auditors, so we expect that we will recognize a majority of the $675 million upfront payment as revenue in the third quarter. And then we also anticipate if you recall, there is a $100 million equity investment a majority of that will be recorded within stockholders equity on our balance sheet and then we'll certainly provide kind of -- there's a further update next quarter, but that's what we're getting at this point.

[George Farmer, BMO Capital Markets]

Okay, great. And can you comment as to whether a milestone will be coming on approval or filing of the pralsetinib as a approval the pralsetinib applications?

[Mike Landsittel, CFO]

Yes, we haven't provided detail on the specifics of the milestone, but I think if you recall, what we said at the announcement of the deal is that there's a potential for $90 million in near-term marketing and approval related milestones. And so, certainly we're excited about what's the current and we'll probably just leave it at that.

[George Farmer, BMO Capital Markets]

Okay, thanks very much.

[Operator]

Your next question comes from the line of Eun Yang with Jefferies.

[Unidentified Analyst]

Hi, this is Sarah on for Eun. Thanks for taking our questions. You touched on this earlier in the presentation. I was just wondering how's the commercialization for advanced SM would like, are they mainly treated in the academic setting? I -- you said there was some overlap, could you provide more color on this? And would you need to expand there salesforce?

[Jeff Albers, CEO]

Sure, Christy.

[Christy Rossi, Chief Commercial Officer]

Sure. So, there certainly is overlaps with particularly advanced SM which tends to be treated primarily at sort of oncology, hematology centers as an excellent academic centers. The specifics around the stakeholders involved in treatment and obviously frequently different than what we see for lung or thyroid or GIST. We have not guided yet to exactly what that commercial structure will look like for us. And however, we've definitely taken as I said, a portfolio approach to thinking about our structure. And we certainly have some roles that are already engaging in activities to prepare for an advanced SM launch and in particular the U.S., we have a precision medicine team that really plays a role across the portfolio and in fact has been primarily focused on RET and at them since the beginning of this year. So more that come on that advanced SM is certainly a very targeted market, we expect to be able to address it nimbly as we have to-date. And then, we'll look to how we may evolve as we as we approach an ongoing SM approvals down the road.

[Unidentified Analyst]

Okay, thank you.

[Operator]

Your next question comes from the line of Arlinda Lee with Canaccord.

[Arlinda Lee, Canaccord]

Hi, guys, I have a couple of questions, Christy, you talked about in being encouraged by resale rates and that that's the real world durability may be that as what we've seen in your clinical trials but you also said that U.S. may not have patients tend not to be going on avapritinib at first diagnosis. So I'm kind of curious if you could provide any additional color on the basis of those statements. And then maybe second – it is my second question would be on the additional nominating candidates for the remainder of the year. Would you mind please, outlining the criteria and prioritization of how you think about your current product in salesforce and how that impacts your criteria of prioritization for your nomination of candidates? Thank you.

[Jeff Albers, CEO]

Christy, I will take first one, answer the second.

[Christy Rossi, Chief Commercial Officer]

So as I said, we -- I am -- I have been really encouraged to see that patients who have started on a avapritinib tend to be staying on therapy and refilling on schedule and that come in, I think speak to a few things. First of all, certainly we're not seeing a negative impact of COVID on those metrics. We don't see a point have perfect visibility into a patient level sort of clinical profile. But based on what we can understand sort of looking at the mix of patients, we see PDGFRA alpha as well as patients who are sort of more [indiscernible] patients, we've been encouraged to see patients refilling beyond what we actually expected. And I think what I attribute that to is the real world benefit risk and tolerability profile of AYVAKIT patient management has been, a really a key focus of our team.

And we see that prescribers are individualizing approaches to dosing with patients and certainly modifying patient dose to make sure that it's appropriate for the clinical characteristics of the patients that they're treating. And we see that that really leads to increase persistence and endurance. So for me, that's a great sign early on in this launch. And I also think it's as well as you think about the asset profile they've [indiscernible] more broadly as we move forward to potential approvals in SM.

[Jeff Albers, CEO]

Arlinda this is Jeff, I'm looking at that -- we're at the bottom of the hour. So it was a broad question that would take more time to address but it's obviously multi-factorial in terms of how we select new targets. But one of them fundamentally that's been a cornerstone is targets where we believe there's a monogenic driver, and one where we ought to be able to get to clinical proof-of-concept relatively quickly based on the chemical matter we have in our library. And what that has transformed into is a portfolio approach that we highlighted in the R&D Day where there are several one targeted type programs with pralsetinib and EGFR programs, their team hematology opportunities are that will grow or build from what we do with systemic mastocytosis. And then it continues to be targeted rare genetic diseases and so those are all reflected in our early discovery platform and just that they are with a more advanced programs.

With that, I think we need to conclude the call. Operator.

[Operator]

At this time, I would like to turn the call back over to Mr. Jeff Albers for closing remarks.

[Jeff Albers, CEO]

Well, then turn it over to you turn it right back to me. So thank you, and thanks for everyone for taking the time and joining us today and for your continued support of Blueprint Medicines. And it's going to be a busy second half of the year. So we look forward to updating you again soon and hope you all stay well. Goodbye.

[Operator]

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