BioArctic AB

STO:BIOA B

Earnings Call Analysis

BioArctic Gains Momentum with LEQEMBI Launch

BioArctic's earnings report highlighted a cash position expected to reach approximately SEK 1.1 billion by year-end, with a slight decrease anticipated due to a predicted negative net profit in the fourth quarter. LEQEMBI, originating from BioArctic, is now the world's first fully approved disease-modifying Alzheimer's treatment, indicating a paradigm shift for the industry. The company foresees continued momentum with the imminent launch of LEQEMBI in Japan and a potential approval in Europe, where sales might commence in Q2 next year. Investment in the Phase 2a safety and biomarker study of a new treatment will be around SEK 100 million over two years, leading to a more significant efficacy study down the line.

LEQEMBI's Landmark Approvals and Neurodegenerative Focus

BioArctic's third quarter of 2023 was transformative, with LEQEMBI—its flagship Alzheimer's treatment—gaining full approval in the US and Japan, a milestone achievement as it's the only disease-modifying treatment for Alzheimer's to reach this status worldwide. The company's mission is to improve the lives of patients with neurodegenerative disorders, focusing on Alzheimer's, Parkinson's, and ALS, along with its novel BrainTransporter technology. With about SEK 1 billion in cash, BioArctic is well-financed to pursue its ambitions.

Global Launch and Financial Strength

BioArctic and its partner Eisai are progressing with LEQEMBI's market entry, aiming for broad commercialization. Following the US approval, 800 patients were on LEQEMBI as of the end of October, with expectations to reach 10,000 by the end of March 2024. In Japan, LEQEMBI is set for immediate launch post-reimbursement decisions expected in December. Europe and China are anticipated to follow with regulatory responses in Q1 2024. The achievements so far have positioned BioArctic for more strategic regulatory submissions globally. Net profits for the third quarter stood at SEK 125 million, and a strong cash position is projected to reach SEK 1.1 billion by the end of the year.

Innovation and Progress in Pipeline

BioArctic is confident in its balanced project portfolio, with advanced stages in its Alzheimer's program and promising developments in its Parkinson's disease and ALS projects. The company's BrainTransporter platform is receiving heightened attention due to encouraging data supporting brain penetration of antibodies. Other highlights include presentations on LEQEMBI's efficacy, particularly when started early in the disease, as seen at the recent Alzheimer Congress. These efforts assert BioArctic's commitment to innovation in addressing neurodegenerative diseases.

Financial Outlook and Future Developments

From a financial perspective, BioArctic's revenues included SEK 209 million brought in during the quarter, with major contributions from milestone payments. The forecast for the company's operating expenses has been narrowed, and an increase in research and development expenditure is projected to support its growing project pipeline. Looking ahead, key regulatory decisions in Europe and China, as well as upcoming data presentations, are set to enrich BioArctic's news flow through the next year.

Earnings Call Transcript 2023-Q3

[Operator]

This call is being recorded. Welcome to the BioArctic Q3 presentation for 2023. [Operator Instructions] Now I will hand the conference over to the CEO, Gunilla Osswald; and CFO, Anders Martin-Lof. Please go ahead.

[Gunilla Osswald, executive]

 Good morning, and welcome to BioArctic's presentation for the third quarter of 2023. I'm Gunilla Osswald and I'm the CEO of BioArctic and I will share today's presentation with our CFO, Anders Martin-Lof. I think it's very exciting times for BioArctic with LEQEMBI being the first and only disease-modifying treatment with a full approval in the U.S. and now also in Japan. And both these things happened during this quarter. I think it's beginning of a new era. And BioArctic is behind this true breakthrough in the treatment of Alzheimer's disease. I find this extremely gratifying that we now can help a large number of patients and families around the world. And I'll talk more about that here today.Next slide, please. BioArctic is listed at Nasdaq Stockholm Large Cap and this is our disclaimer.Next slide, please. So just a quick introduction to BioArctic. Our aim is to improve the lives of patients with brain disorders. And we focus on neurodegenerative disorders. We have a world-class research and development organization. And we are happy about our great collaboration with Eisai, our partner in Alzheimer's disease. We have a broad project portfolio in Alzheimer's disease, Parkinson's disease, ALS as well as the platform of delivering biologics into the brain. We are well financed and we have approximately SEK 1 billion in cash.Next slide, please. I think we have had several important highlights during and after the third quarter. I think it's amazing that we have the first and only approved disease-modifying treatment with LEQEMBI now in the U.S. And that happened early July and we got a broad reimbursement from CMS on the same day. And it has since then initiated the launch in the U.S. In September, LEQEMBI was approved in Japan, and that made BioArctic also then entitled to milestone of EUR 17 million which is equivalent to about SEK 200 million. BioArctic and Eisai have agreed on LEQEMBI commercialization and co-promotion structure in the Nordics. And this is of course something we are very much looking forward to.So the latest Alzheimer Congress, CTAD now in October, new data, strong data on lecanemab was presented from the Clarity AD Phase III study and the open-label extension study. And the data supports the subcutaneous administration. It further emphasizes the importance of early treatment and it supports maintenance dosing. I'll talk more about that here today. I was also really, really excited about the Transferrin Receptor program that was presenting results at CTAD. And I think this makes our probability of success even higher now for our own BrainTransporter program which also have really good internal data. The company has also decided to start a Phase 2a with exidavnebab, which is the INN name for BAN0805 in Parkinson's disease. So we should learn now how to say exidavnebab.Next slide, please. So if we start to talk a little bit about of a launch in the U.S. And I think the market readiness of LEQEMBI in the U.S. is progressing as planned. I think our partner is doing a tremendous piece of work here in preparing the market. They are building a completely new market in the U.S. and it needs a lot of infrastructure. So I think we need to have a little bit of patience to understand how important this part is. In the latter part of October, approximately 800 patients were on LEQEMBI treatment. And our partner, Eisai, they have reiterated the expectation of 10,000 patients being on LEQEMBI treatment by the end of March next year. So that's the same thing they have said for quite some time now. So I think it really follows the plan.Eisai is working diligently to ensure access of LEQEMBI to patients in the U.S. And they have estimated that approximately 2,500 neurologists and Alzheimer's specialists are ready to diagnose, treat and monitor patients with LEQEMBI. And that's an impressive increase from about 1,400 in June. Another great news which came in the middle of October from CMS when they decided to remove the limitation on reimbursement of amyloid PET tracers. And of course, this will facilitate the possibilities to diagnose the right patients for treatment in a better way. And the third important aspect is that LEQEMBI has now been approved by Pharmacy & Therapeutics committees at approximately 60% of the top 100 integrated delivery networks in the U.S. So -- and this is compared to about 10% in June. So I think there are some tremendous important steps forward that will support further growth of LEQEMBI towards the 10,000 patients on treatment, which is expected by the end of March next year.And on the curve, there you can see that we expect this slow uptake in the beginning and then it was expected to increase more and more further on.Next slide, please. So we're now on Slide 6. And I want to talk a little bit about the biomarkers. And I think this is another important area where the biomarkers are developing very well. And I think that could also be important contributions for further growth of LEQEMBI. As I mentioned, CMS expanded the reimbursement of amyloid PET tracers in October. And this will make it easier to diagnose the right patients for LEQEMBI in the U.S. But today, mainly it's being done through PET or CSF. But importantly, the blood-based biomarkers are progressing really well. And I think this can make a huge difference for the future. And it will make it so much easier to identify and diagnose the relevant patients, to follow the disease progression, and monitor treatment effects.The blood biomarkers, they can be used for triaging and that means that if the blood test is normal, there is no need for further CSF for PET scans. If the blood test shows intermediate levels of the proteins, then they require further confirmation by CSF and PET. And if it is high level that shows that it's a high likelihood that the patient would benefit from LEQEMBI treatment. So that is another possibility. I think about this, the usage of the triaging with blood biomarkers, it's already happening now in smaller scale and it's expected to grow during next year. And in a couple of years, we expect the blood-based biomarkers to be used in clinical practice. And this will then clearly simplify the patient journey and that will form the basis for further growth of LEQEMBI. So I think this is also a very exciting area to follow.Next slide, please. LEQEMBI is the first and only disease-modifying treatment with a full approval in the U.S. and now also in Japan. And it's broadened and broadening around the world. And if we start to look into the U.S., more things is happening there. Our partner, Eisai, they plan to submit the supplementary BLA or intravenous maintenance therapy with once-a-month dosing by first quarter of next year. They also plan to submit a new BLA for the subcutaneous autoinjector formulation. And I think that is 2 important parts in making it more patient-friendly and easier for the patient.If we then turn into Japan, where the approval came on the 25th of September. Now the National Health Insurance is working on the pricing and reimbursement. Normally, this takes about 60 to 90 days after approval. And we know that our partner, Eisai is eager to start the launch, and they are planning to launch imminently after the prime listing. So that is most likely happening very late this year. Then if we look into Europe and China, it's where review is ongoing and Eisai anticipate approval in the first quarter of next year. Then Eisai is working diligently with further regulatory submissions and applications around the world. It has now been submitted to 10 other countries around the world. And we have got priority review and other approaches in order to make faster reviews at a couple of countries like Israel and Great Britain.So I think that I'm very excited about that lecanemab has the potential to become the first anti-amyloid antibody to receive a full approval on a global level. And I think it looks really promising.Next slide, please. So some of the highlights from the Alzheimer Congress, CTAD which was held in Boston in October that I would like to mention is, of course, things about lecanemab. But let me start by saying that I think it was a very positive atmosphere. And there was a sense of optimism for both the diagnosis and the treatment of Alzheimer's disease. And there was a lot of highlights and strong data being presented for LEQEMBI. If we start with the subcutaneous treatment, which I think looks very promising and both the pharmacokinetic and the pharmacodynamic 6-month results show that it met the bioequivalence criteria, which is a very important step. And also, data that was presented showed that amyloid test data showed 14% more reduction of amyloid plaque after subcutaneous administration compared to intravenous administration. So even stronger effects and with similar levels of the adverse events regarding ARIA.And it shows that it's probably more the AUC and the average concentration which is linked to this rather than Cmax. The other next really important part, which I think was very encouraging was that they showed that if you start treatment with LEQEMBI very early in the disease, then you can potentially have even better results of effect. There was data presented from a subset with patients in early stages that had low levels of the protein tau. And here, they showed and you can see that on the 2 graphs here to the right, that 76% of lecanemab-treated patients did not decline over the 18-months period versus -- compared to 55% of the placebo-treated patients. And 60% of the lecanemab-treated patients were even improved.And if you compare that with 28% for placebo. We should be aware that it's only small groups of patients, but it's very encouraging for patients in very early phases of the disease. So I'm really encouraged by that. And then data from the open-label extension study showed that the treatment with LEQEMBI continues to have an effect even after 18-month treatment. And that's pointing to the importance of continued treatment for the benefit of the patient. Professor Lars Lannfelt also presented data on lecanemab binding profile, showing that a relatively low binding to CAA are linking to the relatively low frequency of high effect ARIA-E compared to other anti-amyloid antibodies.Another highlight from the Congress was the external validation of the transferrin -- transporter concept for bested brain penetration of antibodies. And I think this increased the probability of success for our BrainTransporter platform even further. And as I mentioned earlier, the blood-based biomarkers continue to develop well for diagnostics, disease progression as well as treatment monitoring for Alzheimer's disease. And it's already being included in clinical practice by some leading key opinion leader, for example here in Sweden and elsewhere. And I think it has great opportunities for the future.Next slide, please. Now we are on Slide 9. So building on the success of Alzheimer's disease, we see a lot of similarities and opportunities for our alpha-synuclein program, which is intended for neuronal synucleinopathies. And as we can see, both lecanemab and exidavnemab are very selective antibodies towards the toxic aggregated forms of the protein called alpha protein. And these forms are called oligomers or protofibrils. In Alzheimer's disease, the protein is called amyloid beta and in Parkinson's disease, the protein is called alpha-synuclein. And in Alzheimer's disease, we have the first disease-modifying treatment that's coming through with the LEQEMBI being the first and only fully approved disease-modifying treatment in the U.S. and Japan so far.The development for Parkinson's disease and other synucleinopathies are lagging behind Alzheimer's disease that can really benefit from some of the important learnings that we have from the Alzheimer's disease. And I think there is a lot of potential indications and that gives further opportunities for the future in both areas. In Alzheimer's disease, for example, going even earlier, Down’s syndrome with dementia, and so forth. And for synucleinopathies, we have Parkinson's disease, and we have Lewy body dementia, Parkinson’s disease dementia, and Multiple systemic atrophy for example.Next slide, please. I also want to talk a little bit now today about exidavnemab, which previously was called BAN0805, which is the potential disease-modifying antibody for Parkinson's disease and other synucleinopathies. And here, we now are progressing towards starting Phase 2 next year. And as you know, for example, Parkinson's disease is the second most common neurodegenerative disorder. And I think that when we look at our antibody and compare that with competitors, we have a unique antibody. It's the most selective antibody that I have seen. It's very selective for the pathological forms of alpha-synuclein, the oligomers/protofibrils, more than 100,000 fold selectivity versus the physiological forms and monomers in the body. So I think that is one of the unique parts.Another part which I want to mention is that how we think that BioArctic is that if you have a clear link to genetics, that makes it a higher probability of success and a lower risk. And we have the same thing here with alpha-synuclein in Parkinson's disease as we have for amyloid beta in Alzheimer's disease. We have very strong preclinical data, as you can see up to the right, where our antibody really makes motor-symptoms come much later and makes the lifespan of this very aggressive Parkinson's disease model. They had a doubling in lifespan. Down to the right side, you see some of the Phase 1 results and exidavnemab was well tolerated in all doses up to the highest dose, which was 6 grams, so a very high dose. We saw an excellent PK profile with an elimination half-life of about 30 days, which supports once-a-month dosing.We also just recently had our patent granted in -- we have previously U.S. and also Japan, where we have a patent life up to 2046, including extensions. So I think that is also a really good benefit for this program, taking it forward.So if we go to the next slide, Slide 11 where we see some of the opportunities for exidavnemab in the future. The company has taken the decision to drive exidavnemab forward by ourselves a bit longer, and we see a lot of opportunities here. But of course, we would like to have a new partner before we go into Phase 3, but we can definitely drive it forward a bit longer ourselves. And we have now worked hard to bring back data and material back from AbbVie. We have data in clinical study reports, and we are now preparing for the Phase 2a study in Parkinson’s disease to start next autumn. And after Phase 2a, we have several different opportunities for this program. For example, Parkinson's disease, but also the areas where we have a lot of expertise in dementia areas such as, for example Parkinson’s disease dementia and Lewy body dementia.So I think that's really important opportunities as well for this program and as well as we can drive it also in Multiple systemic atrophy. An area which is progressing really well here as well is like a red thread, both in Alzheimer and Parkinson's disease, it's a biomarker. And that has been one of the limitations in Parkinson's disease, but it's great to see that there is positive progress also for the biomarkers in this area as well. So there are now biomarkers coming forward, which makes it, for example, possible to identify the right patients with pathological alpha-synuclein, for example with seeding amplification assays. And I'm really excited to see the program and the progress of the -- of exidavnemab now going forward and going into patients next year.Next slide, please. So in summary, we have an innovative and balanced project portfolio with focus on neurodegenerative disorders like Alzheimer's disease, Parkinson's disease, ALS, and also our BrainTransporter technology. So I've been talking a lot about both Lecanemab and exidavnemab here today, but I also want to mention that our TDP-43 project for ALS is progressing really well. And for those who are really detail-oriented, you can see that our program has moved one step forward in this graph just to show the progress of that portfolio program as well. And the BrainTransporter platform continues to progress very well, and we have now increased our focus even more on our 2 different Alzheimer's disease BrainTransporter projects. And we are further encouraged by the data presented at CTAD together with our own data.Next slide, please. So by that, we come to the financial summary, and I will hand over to our CFO, Anders Martin-Lof. Next slide, please.

[Anders Martin-Lof, executive]

 Thank you, Gunilla. We should then be on the Slide 14. First of all, I want to comment a little bit on the sales that have been achieved so far with LEQEMBI in the market. We have received some questions whether we think this is according to expectations or if we think the revenues are low. But we clearly think that this is as expected, and we are according to plan or actually exceeding plans in some ways. And I'll try to explain why we think so. So first of all, when the drug was launched, it takes time to make sure that the hospitals start using the drug code and get all the necessary approvals they need to make that happen. And as Gunilla said, that is progressing according to plan. The number of IDNs that are using it has increased from 10% to 60% already. But that's not enough.The patient also has to get the drug. So even if the hospital is using the drug, it takes up to 2 months before the patient actually can get this treatment and the sales are starting to be generated. So what should be expected is that in the first 2 months or so after the launch, there should be very, very low levels as very few patients can get their treatment. Then in the third month, you should start to see that some patients are actually starting to get treatment, but those are basically coming from the hospitals that were using the drug from the very beginning. And then in the following months, you should start to see patients coming on from new hospitals that are starting to use the drug after the launch. So basically, what you should see are very low numbers for July and August. You should start to see an increase in September, and then you should start to see sort of a catch-up effect from October and onwards.And that is exactly what we are seeing so far. If you look at the graph on the left-hand side, you see the weekly average revenues in the U.S. And the October figure, that's the first week of October, I think the sales in the U.S. were in the neighborhood of $0.5 million. And that's roughly 100% up from 4 weeks before. So we are really starting to see this catch-up effect. And we think that this will continue. Gunilla has already mentioned that all the hospitals are now coming online. We will also see the PET reimbursement in the U.S. being implemented in the last few months of this year. And this will also be then helped by the Japanese launch that we expect will start around year-end. So we really think that we are in a positive trend. This is according to plan.And if we turn to the left-hand side of the picture, you see that Eisai has set an aim to reach JPY 10 billion in sales for their fiscal year 2023. That's roughly -- that would mean roughly that we have to sell some USD 65 million in Q4 of this year and the first quarter of next year. And we clearly think that this is feasible. And that for us, that would mean we get single-digit royalties, high single-digit royalties on those numbers. So I think this is all in the right ballpark range. However, it's really, really hard to extrapolate from just a few weeks to see exactly where we end up. So this should be seen sort of as a ballpark estimate rather than any guidance or a forecast. But I do think that the numbers that have set up by Eisai are really feasible, and I hope you now understand what that would mean for us in the next few quarters.If we then turn to Slide 15. On the left-hand side, you see our net revenues. And for the quarter, we had revenues of SEK 209 million. And for the 9-month period, we had revenues of SEK 605 million. This is more or less explained only by the milestone payments we have received, totaling EUR 52 million in the 9-month period, and we received the Japanese milestone of EUR 17 million in the third quarter. But we should also start to look at the new revenue streams that are included in our revenues now. We recorded SEK 2.5 million of royalty in the third quarter, and we also got co-promotion revenues of SEK 3.6 million. So royalty is, of course, the royalty on the global sales of LEQEMBI. The co-promotion revenues is what we are getting out of the collaboration with Eisai in the Nordic for the commercialization of LEQEMBI here.And we are -- of course, we have not launched the product already, that we are working together. So we are receiving some reimbursement from our costs as we split the profit from that collaboration 50-50. Over time, these 2 revenue streams will be, of course, be the most important revenue streams for BioArctic. But I would say next year, you should probably expect that they would be half of the revenues that we have in that ballpark range, the rest will probably be milestones. And then from 2025, and onwards, you should expect that the royalties and co-promotion revenues will make up the majority of the revenues for BioArctic.Turning then to the expenditures in the middle graph, you can see that our operating expenses decreased to SEK 78 million in the third quarter from the second quarter, an increase year-over-year. But the decrease from the second to the third quarter is mainly explained by personnel costs that went down from the second to the third quarter due to a non-recurring effects in the second quarter due to our stock option programs. We have then reiterated our operating expense guidance, but we have narrowed down the range a little bit. So we now expect to have a full-year cost of SEK 350 million to SEK 370 million for 2023. It is an increase from 2022 by SEK 246 million. And we will continue to see increases in our costs over the coming years.Next year, we will increase our R&D costs as our project portfolio is progressing really, really well. Gunilla mentioned the Parkinson project that is now entering clinical trials. For example, we are also building up our commercial organization a little bit more. I think we are at roughly 50% now. So it will continue to increase during next year as well. On the left-hand side, you see our operating profit, it was SEK 131 million for the third quarter and for the 9-month period, SEK 331 million. And given that you -- we have also then given you some guidance for costs, you can deduct that the profit for the year will be in the range of SEK 250 million and upwards on the operating profit level.Turning then to Slide 16, talking a little bit about our cash position. As you see, on the left-hand side, we have cash and cash equivalents, including short-term investments that were over SEK 998 million at the end of September. But if you look on the middle graph, it seems like we had a cash flow that was negative SEK 53 million, i.e., roughly SEK 184 million below our operating profit. And this is explained by the milestone that was received from Japan. It was recorded as revenue in September, but it wasn't paid in September. So we had roughly SEK 200 million in accounts receivable from Eisai that will be received in October.So all in all, we think that the cash position at the end of the year should be roughly in the SEK 1.1 billion range. So that we understand that we will go up from the end of September position. And the net result was -- net profit was SEK 125 million for the third quarter and SEK 316 million for the January to September period. And I think it will be negative in the fourth quarter, so it will go down a little bit from that level.I think that concludes the financial part, and I will leave the word back to Gunilla for some concluding remarks.

[Gunilla Osswald, executive]

Thank you so much, Anders. So then we come to upcoming news flow and closing remarks.So next slide, please, and now we are on Slide 18. So if we think about what's ahead of us, we are now looking forward to what's happening in Japan with the price and reimbursement decision that we expect in December and the imminent launch of LEQEMBI in Japan via Eisai on that. If we then look at next year, then in March, we look forward to the next big Alzheimer's and Parkinson's Congress called AD/PD in Lisbon in March where we expect several presentations of lecanemab. If we then look at the regulatory part, where we also have some really important things coming next quarter, next year -- first quarter next year. And that is a response in Europe and China from regulatory authorities. And if we get an approval in Europe, which we hope, then we can, in the second quarter, see the first sales of lecanemab in Europe as well.And then for the first quarter, the filing of the maintenance dosing in the U.S. at sBLA and the new BLA for subcutaneous autoinjector formulation is also planned for the first quarter of next year. But I think it's really exciting times for us, and we can conclude that we have had a fantastic year so far. And this last quarter has really been a highlight with the approval in the U.S. and in Japan. And we have a very exciting year ahead of us.So then if you take the next slide, please, and we can then conclude that LEQEMBI, which is originating from BioArctic is now the world's first and only fully approved disease-modifying treatment of Alzheimer's disease. And this is leading to a paradigm shift in the treatment of Alzheimer's disease. And I think that BioArctic is an innovative and dynamic and very exciting company with a huge potential.So thank you so much for your attention and happy to take some questions and the next slide, please.

[Operator]

[Operator Instructions] The next question comes from Erik Hultgard from Carnegie.

[Erik Hultgard, analyst]

First, congrats on the progress with the U.S. launch of LEQEMBI. A couple of questions from my part, mainly related to exidavnemab. First, when and if -- or do you plan to publish or present additional data from the Phase I study that would sort of increase confidence in a positive outcome of the Phase 2a study, including like how much of the drug is entering the brain, target engagement and other factors that are important? Then secondly, is it fair to assume a similar design and endpoints as used in protein as PASADENA study or are you considering any changes in the design, including endpoints, biomarker enrichment, or sort of selecting sort of more early-stage patients in the study? And then finally, could you guide a bit on what the costs will be for conducting the Phase 2a study? Sort of ballpark number or cost per patient estimate, et cetera.

[Gunilla Osswald, executive]

A lot of great questions. And I have to say that it's quite early days yet about exidavnemab. We should be aware the Phase I program we have so far, as you know, is a very good data, but for single doses and also including some Eisai patients and also including subcutaneous formulation. So all that work, we have just written a clinical report. We're working on the manuscript and working on to see when we can present more data at external congresses. But just to manage expectations, I mean you should be aware it's a single-dose study. So the next study that we plan to do is really to do multiple-dose study in 40 some patients.And we are working now hard on the design and thinking about the endpoints and biomarkers and so forth. But I think you need to understand it's a Phase 2a study with multiple dosing and a shorter dosing period before we go into a Phase 2b study just to manage expectations. So -- and we will come back to more about the design and the cost of that, I think, when we have that more nail-bound in detail.

[Anders Martin-Lof, executive]

Right. But maybe you should mention that we are really looking at the biomarker enrichment to find the right patients to enter the trial. And that's a big piece of news. I think that there could be a possibility for us that, that could improve the probability of success of a trial like this compared to all the other trials that have been conducted in Parkinson’s disease previously.

[Gunilla Osswald, executive]

So I think it's fair to say that we're still working on exactly as it's signed-up and ready.

[Erik Hultgard, analyst]

Also, Gunilla, on that topic, I think biomarkers, obviously, would be a huge advancement for the field. So are you planning to -- how validated are the biomarkers in PDM? Are you considering only rolling sort of biomarker-positive patients? Or will this trial sort of evaluate biomarkers?

[Gunilla Osswald, executive]

So I think it's fair to say that, I mean, this is an area which is really evolving right now. And we are really, I mean, among the lead here. So we are evaluating now especially this, which looks really promising with seed amplification assay. As Anders said, there's a possibility to identify the right patients. And we will, of course, also see maybe, you can use it also for -- we're seeing some pharmacodynamic effects and so forth. So I think the first study, I mean, it will be more for pharmacokinetics and safety. And then the Phase -- and then we will see how much we can do with biomarkers. The next study after that, which I showed that we are discussing several different opportunities, several different indications. And here, we will be guided by some of the external readouts that will happen, but we have some really cool ideas about what we would like to do ourselves, also where we will be utilizing all our expertise in cognition and so forth, and really utilizing the best of the biomarkers like Anders talked about and other things.So I think that the next study is more for safety, PK, and a little bit of biomarkers. And then the step after that will be the really important one.

[Anders Martin-Lof, executive]

And as for the cost, Erik, this is not a huge trial. It's not super expensive and we haven't finalized the protocol of course. So we don't have a fixed cost. But it will be in the ballpark range of SEK 100 million over a 2-year period, something like that.

[Gunilla Osswald, executive]

So then you understand it's more of a safety PK study with some biomarkers and then the study after that will be more of an efficacy study, and that would be more costly.

[Operator]

The next question comes from Viktor Sundberg from Nordea.

[Viktor Sundberg, analyst]

So yes, also a question maybe on the alpha-synuclein Phase II study with BAN0805. I guess that in theory, the idea of targeting aggregated forms, where you have these 10,000-fold selectivity you don't target monomers in systemic circulation, which I guess could cause side effects. So I just wonder, after you have reviewed the package from AbbVie, do you see that in the data as well, that it looks better than, let's say, prasinezumab versus cinpanemab in terms of systemic side effects? And have you seen anything in terms of higher brain concentration due to the higher selectivity for aggregates? That's my first question.

[Gunilla Osswald, executive]

Great question. And I think it's fair to say, again, that the first study was single adult administration. So you should not expect so much long-term effects on biomarkers and so forth. But we will be presenting more of the results. You saw the PK data looks really good, supporting further progression. But safety and tolerability profile was really good. And we also are looking now also into -- we saw some effects on the blood biomarkers that will help us also in setting the dose for the next study. So we will come back with more presentation on data from this.But I just want to manage expectations both from Erik and from you that I mean it's an early study and the next study will be like repeated dosing, maybe 3 months dosing and so forth before we go into the really important efficacy studies later on. But it looks very good on the safety and tolerability perspective. We can go up high in dose, higher if we want to than obviously from the competitors. And then I also want just to mention on one of the compounds you talked about, which is stopped had a completely different binding profile than both prasinezumab and our compound 0805 or exidavnemab. So I think it's important to realize that every antibody needs to be thinked about as a unique antibody. And there are some important differences you need to understand for why some antibodies work and some don't. The same thing in Alzheimer's disease as we see in Parkinson’s disease.

[Viktor Sundberg, analyst]

And a follow-up also on the Parkinson's programs. I just wonder what kind of feedback you have received from partnership discussions, what are people, say, hesitant about, and why they want to see more data in your program? I assume that partnership is still part of the strategy, but you have to take it a bit further on your own first. And you have setbacks in vaccines and other trials where people are cautious on alpha-synuclein or is it something else?

[Gunilla Osswald, executive]

Yes. No, I think, I mean, we have had quite some interest and so forth. And I think we had a really good discussion with several partners. But we see that we have a great opportunity to drive this program further, and we have the financial muscle to do that. So what we want to do, and we have some really cool ideas for the future. So we would like now to drive it forward. And then by that, be able to increase the value and increase interest before we get into a further partnering discussion. And we need a new partner before Phase 3. But there's quite some time to that. So I really think that we will have some really exciting time driving exidavnemab further ourselves and finding a new approach to help patients in the future.

[Viktor Sundberg, analyst]

And just a quick final one. You talked about your binding study on aggregates versus monomers. But I also wonder, have you done any preclinical work or binding studies versus the other antibodies that have been in trials before? Or is that -- or do you plan to do any of those kind of studies, which you have done in Alzheimer's as your binding profile is different?

[Gunilla Osswald, executive]

Yes. Of course, we have done that. And we have shown some of those data previously, and we will definitely show some of that also going forward. And we see that we -- I don't know any other antibody, which is so selective as the 805 or exidavnemab versus the monomers. And we believe that, that is very important, maybe even more important than in Alzheimer's disease because you have more abundant monomers. So you really want to have a high selectivity, which we do. So we will come back with that. But I'm so happy to hear about the excitement about exidavnemab which I am excited about. So maybe we'll give more room for this in the future.

[Operator]

The next question comes from Luisa Morgado from Van Lanschot Kempen.

[Luisa Morgado, analyst]

Maybe going back a bit on the lecanemab program. So I was wondering, given this positive data for the subcutaneous formulation and since it's weekly versus the biweekly IV formulation, what proportion do you estimate? So what proportion of patients do you estimate that will go for one formulation and vice versa? And also another question, when do you expect maybe to initiate commercialization in the Nordics? So for LEQEMBI, of course.

[Gunilla Osswald, executive]

Two great questions. So I think the first thing is that I was really happy at CTAD when I presented the Sub-Q data for 6-month data. Thus it really looks like subcutaneous will be a good alternative for the patients. I think it's also very good to be able to do it weekly. Patients and families can support at home. So you can give the injection or through an autoinjector at home in contrast to the IV infusion, which mainly will be with [ intravenous ] infusion centers. It could also be done ambulatory, of course. So I think it's really hard to say exactly how many will be on one or the other. But I really see subcutaneous as a really good alternative for the patients that will help to facilitate the administration. And I think this is also an important differentiating factors versus some competitors, which is not having Sub-Q.So I think Sub-Q will be a very important part. I think some patients will still think IV is good. So I think we will see both. But definitely, I'm excited about the Sub-Q part. So we will follow that and see. And then the Nordics, we hope, of course, then for an approval in first quarter of next year. And then after that, Europe is very different from country to country. Some countries in Europe like Germany, Eisai can start to launch quickly. Whereas in the Nordics, it's also different in the different Nordic countries. So you do the pricing and reimbursement discussions. And that Eisai would be driving those parts. And normally, that takes about a year. So I think that helps to guide a bit when we plan the launch in the Nordics. So we are very excited about this. And we are, of course, preparing and starting to think about and also see how can we prepare the infrastructure and so forth, which is really important to make society ready for this kind of new treatment paradigm.

[Operator]

The next question comes from Fredrik Thor from Redeye.

[Fredrik Thor, analyst]

I was wondering a bit about the collaborative launch in the Nordics. Could you say anything about how big of an internal commercialization you expect to have at BioArctic?

[Anders Martin-Lof, executive]

Sure. Right now, we have people in the range of, well, 11, 12 people or something like that, that will increase a little bit when we recruit account managers. So for us, I would say, our part of the commercialization will be roughly, say, 18 to 20 people or something like that. And then Eisai will have a smaller sales force and then we will share the cost for that. So they will reimburse us for part of our cost. So we have a 50-50 split on the profit level.

[Fredrik Thor, analyst]

And also about, as you mentioned, the increased PET coverage in the U.S. I was wondering, can you elaborate a bit on how much of an obstacle was it before that? And how quick of an impact do you expect with this increased coverage?

[Gunilla Osswald, executive]

I think that's a great question. And I think if you compare different parts of the world, different regions use PET different much if you put it like that. So the alternative to PETs has been CSF sampling with lumbar puncture. And a country like Sweden, we are very good at doing lumbar puncture. That's kind of normal routine practice. In a country like the U.S., they are not at all as used to doing lumbar puncture. So there has been a clear drawback not having had a PET tracer with broader reimbursement. So I think for the U.S., this will be an important part. And for some other countries, it's really very important to have that at least until we have the blood biomarkers coming further ahead. So I think that will make a difference in the U.S.And -- but then I think -- I mean, you wish it would be coming through directly and it will not. It will take a little bit of time here again before it really goes through all the infrastructure at the different hospitals and so forth. And coming into the list of each hospital and being used in the broader sense. But I think it's definitely a very positive part to see this happening.

[Fredrik Thor, analyst]

And a final question from my end about the subcutaneous formulation. In terms of different geographical markets, let's say, Europe versus U.S., I know you have discussed a little bit before me, but do you expect that to be higher for the subcutaneous in Europe, for example, compared to the U.S. or roughly the same split between them?

[Gunilla Osswald, executive]

I mean I don't think anyone can respond to that. I mean I think it's fair to say that the first focus now would be the U.S. for the subcutaneous and the autoinjector. So that's the first part while it's preparing for the filing in the first quarter of next year. And then we'll take it region by region, but it will start in the U.S.

[Operator]

The next question comes from Alistair Campbell from Royal Bank of Canada.

[Alistair Campbell, analyst]

I've got a couple. First of all, if I just sort of come back on that last question a little bit. And just are you aware of timeframe or any plans currently from Eisai to bring other subcutaneous sort of maintenance IV formulations to the market in Europe? So is there any planning in place for that right now? And then the other question really is sort of asking you, to have you get the crystal ball out and think about BrainTransporter technology. Compared to Roche, we're clearly very impressive in terms of speed of removing amyloid and also a very impressive side effect profile. So I guess, first of all, just to understand how far behind Roche you believe you are with your program? And then secondly, given that Roche has shown very strong data in terms of removing amyloid from brain very quickly, do you think that still leaves room for a differentiated binding profile to still mean you can drive a meaningful efficacy difference as well?

[Gunilla Osswald, executive]

A lot of excellent questions, Alistair, as always. So I think for the -- we'll start with the subcutaneous. And I think the subcutaneous, I mean what Eisai showed was that it could be used both as starting on subcutaneous, which they had by the de novo patients who had got placebo or come new into the open-label extension part of the subcutaneous study. So it shows that you can start that. It also shows that you can go from IV to subcutaneous and you could think about that as a maintenance treatment. So I think all options are open based on the data we have seen so far. So I think it's a little bit too early to say exactly how it will be used. But I think to me, I mean, the most important part was to see that it really seems to work as was expected.And I think it even showed a little bit higher exposure, a little bit stronger efficacy on clearing the amyloid deposits from the brain. So I think it looks really, really promising. But it's a little bit early to say exactly how it will be used. And then with regard to the BrainTransporter, I think it was very impressive to see the results at CTAD. And I think it's fair to say that we are a little bit more than 2 years until we are in the clinical setting. But after that, we see that we could drive this very quickly forward because we have the possibilities to benefit from the PyroGlu antibodies on animals, where we think that we have some clear benefits with our BrainTransporter molecule, PyroGlu molecule.And also, we have the other BrainTransporter Alzheimer's program, which also, I think, has a lot of great opportunities. So I think what I've said many times before, what really impressed me with the BrainTransporter technology when you get more antibody into the brain, and what we see is they get much, much broader distribution to the brain, you get it fast, broad and deeper as compared to a naked antibody. And this -- I say it all the time, this opens up the opportunity for maybe having even better efficacy. And maybe also even better on the side effect profile. So I think we are eager to see how we can drive our programs forward in a speedy way to see how we can really help patients with this alternative as well. So I'm really, really eager to see how that will be progressing forward.Did I answer your question?

[Alistair Campbell, analyst]

Yes, that's great.

[Operator]

The next question comes from Joseph Hedden from Rx Securities.

[Joseph Hedden, analyst]

Eisai has given a lot of metrics about the launch of LEQEMBI in U.S. so far. And it's clear that there are multiple challenges in building a new market like the company is trying to do at the moment. One of those seems to be scanning. So Eisai talked about the importance of Medicare's broadening of coverage of PET scans. I was wondering your thoughts on the importance of that versus MRI being as LEQEMBI needs some MRI monitoring on infusion? And where does CMS' current coverage sit on that? And is this a significant barrier to prescribing what Eisai is experiencing?

[Gunilla Osswald, executive]

According to my understanding, it is covered in the U.S. with the MRI scan. And I think an important aspect here is that you have a certain number of MRI scans that you should be doing when you start treatment with this kind of new treatment. And it's especially during the first 6 months. And since LEQEMBI has shown a lower frequency of ARIA, my expectation is that you will have fewer needs of MRI scans compared to some of the competitors or all the other competitors that have shown more ARIA-E. And if you have the ARIA, then you need to do more MRI scans. So I think that, that looks like another benefit for lecanemab. But as I have understood it, the MRI scans are reimbursed in the U.S.

[Joseph Hedden, analyst]

And then if I could ask just on Nordic timeline. So if we expect the European approval in the first quarter, when realistically do you expect to make your first Nordic sales and when and where? I know that you're going to have to go through pricing and reimbursement negotiations. At what point could we expect that to happen?

[Gunilla Osswald, executive]

So just as I said, I think, I mean, if we get an approval, then in first quarter next year, which we hope for, then it's about a year. So I think it's fair to expect the first launch in the beginning of 2025. And of course, I would like to see Sweden coming first. We'll see. But all the Nordic countries are important, of course. And I think Sweden is sometimes a bit faster than some of the other Nordic countries.

[Joseph Hedden, analyst]

And just on the revenues you recorded due to co-promotion. Can we expect similar levels in the coming quarters proceeding the Nordic launch? Is that the kind of run rate we can expect?

[Anders Martin-Lof, executive]

It's going to be a little bit lower than that for the next few quarters. And then when we ramp up our sales force a little bit, it will start to increase. And then as soon as we start selling, it will increase quite a bit.

[Operator]

The next question comes from Erik Hultgard from Carnegie.

[Erik Hultgard, analyst]

A couple of follow-ups, if I may. First, on the Sub-Q formulation, given that it's a one sort of fixed-dose regimen, are you considering or are Eisai considering developing a lower dose option given the higher exposure observed than I assume that dosing a 50 kilogram person versus 100 kilogram person gets very different exposures. So that's my first follow-up. And then secondly, on the blood-brain shuttle technology, when can we expect you to share some more data on the potential differentiation versus [indiscernible] technologies?

[Gunilla Osswald, executive]

So excellent questions, again, Erik. The first question with regard to the Sub-Q. I mean I think that it was clearly seen that the fixed dose of 720 milligrams showed some benefits over the 10 milligram per kg dosing IV. So there is an opportunity of lowering the dose. And that is, of course, on the discussion that you need to think through the data further. I don't think anything is finally decided yet. But of course, there are -- it's obvious thought that, that's one of the things you can think about. And then with regard to the fixed dose, I think it's a trade-off between being easy to use for patients and so forth. And that is exactly what Eisai will be looking at also to think what this means when you have different body weights and so forth.So that's all in the evaluation and that must be done in order to submit the file. So -- but I think it's fantastic that you can have the alternative for patients to give it IV with an autoinjector that is much more user-friendly for the patients. So -- and it looks very promising. I'm really happy about that, and we'll see exactly what dose and how and when we come further. And then with regard to the BrainTransporter technology, as you know, this is a very, very competitive area. And we think that we have something which is clearly differentiated and has some clear benefits. So I would say -- I would guide you to fourth quarter of next year. Then I think we can talk more about how we differentiate and why from competitors.But you have to stay tuned a bit longer. I wish I could tell you. I'm very excited about this, but it's too competitive to reveal things early. So -- but we are confident with the data we saw and our own data that it looks very promising.

[Operator]

[Operator Instructions]

[Anders Martin-Lof, executive]

So Gunilla, we have another BrainTransporter question in the queue here online. I'll read it to you and then you can answer. It's from Victor. And he says, regarding the BrainTransporter technology, what is the commercial prospects for this technology? Is it most likely scenario out-licensing deal or how are you thinking about this going forward?

[Gunilla Osswald, executive]

Excellent question. I think that the first thing we would like to do is exactly what we're doing now is to link it to our own antibodies and proteins. Like you have seen that we now have it in 2 Alzheimer's programs. We have it also in an alpha-synuclein program. We're also working on it together with TDP-43 antibody. And we also have it in another program for an enzyme replacement therapy to address CNS symptoms of Gaucher's disease. So the first thing we are thinking is to utilize it as a differentiated benefit for our internal program. But of course, this is a huge opportunity with the platform technology that you also could add to other companies' biological therapeutics. So we are thinking about a bit later on to also see if we can help other companies, for example, think about brain tumors and other things where you also would like to have more of your biologic therapeutic in the brain. So I think -- and then we are thinking of several non-exclusive license deals, but then we talk long-term future.For now, we're using it to make the benefit for our own program. But I think it has a lot of opportunity for the future. I'm very excited about the BrainTransporter technology.

[Operator]

There are no more questions at this time. So I hand the conference back to the speakers for any written questions and closing comments.

[Gunilla Osswald, executive]

So I hope you heard the last question about the BrainTransporter and my response. And if you did that, then I think there were no more questions. So then I say thank you so much for your attention and all the great questions, and I wish you a great rest of the day. Thank you so much.