Asthika Goonewardene: Okay, great. Just my quick follow-up then is of the 1,500 diagnostic tests that were – patients that were screened, and maybe if you can give any color on more recent numbers, too. About what percentage of them were from patients who are currently on a first or second line therapy for ovarian cancer? Just trying to see there’s a way for us to back out what the more immediate pent-up demand could be? Thanks.
Todd Talarico: Well, we don’t exactly know at what state each patient is at. I think what we found in the beginning was that we did have a lot of patients that were waiting for this product. So the testing early on was directly related to a platinum-resistant patient that was due to move on therapy. But as Mark alluded to earlier, the testing has been shifting and physicians are moving earlier, and practices are moving earlier to earlier diagnosis. And so, really difficult for us to determine the actual place in therapy for when the testing actually occurred.
Asthika Goonewardene: Thanks, I appreciate the color.
Operator: Thank you. Our next question comes from the line of Daniel Wolle with JPMorgan. Your line is now open.
Daniel Wolle: Good morning, thank you for taking my question. Two questions first, regarding the Vertex agreement, considering recent attempts to use ADCs for conditioning by going after, for example, CD117. How differentiated are some of the targets you or Vertex are going after? And second question, understanding that – it’s only been a few months for ELAHERE, but given that it’s a drop shipment based ordering, what’s your visibility on the persistence of use?
Mark Enyedy: Right, so as it relates to Vertex, we’re not at liberty to comment on the targets, other than to say that these are being used in conjunction with their gene editing programs, and we’re very pleased to be partnering with a company the quality of Vertex. And then in terms of persistence, again, it’s early. I mean, what we can say is a significant and growing percentage of the orders are repeat orders or accounts who are repeat ordering. So, we’re obviously very encouraged by that. But again, we just don’t have a window into the what – how the duration of therapy at this point.
Daniel Wolle: Great, thank you.
Operator: Thank you. Our next question comes from the line of Jonathan Chang with SVB Securities. Your line is now open.
Jonathan Chang: Hi guys, thanks for taking my questions. First question, can you provide more color around when this year we could get the ELAHERE product revenue guidance? What would need to happen first before you’re in a position to give guidance here? And then second, congrats on the Vertex partnership. Can you talk about how you’re thinking about different options for extending the cash runway? Thank you.
Mark Enyedy: Yes, so I think, realistically, Jonathan, we’d like to have two solid quarters under our belt before providing guidance. So I could imagine, as we report out our second quarter earnings late in July or in early August that we would be in a position to give some guidance. And at that point, we would have some of the information that we’re – that many of you are reasonably asking at this point, what’s your duration of therapy, how do you think about the accounts, where is the business coming from. And I think we’ll have a much clearer idea on that and also the strength of the trends, a better evaluation. We have a going in position with respect to the value of individual targets in terms of anticipated patient starts, revenue, et cetera, and titrating those data and are all really important.
And then sorry, Jonathan, the second question? Cash one, right Yes. So the first point to make is where we are with cash and cash equivalents and the application of the auditing test. We shared in this morning that — we will be sharing in our SEC filing, and that creates a going concern situation for the business. But that measure excludes — when you’re in a launch phase like we are, it excludes essentially all product revenue. They maybe give you credit for pennies on the dollar. So what we want to make sure that people understood clearly was that with the addition of our expected ELAHERE revenue that we’ve got significantly more than 12 months’ worth of cash for the business. That said, we are evaluating additional options to finance the business, which would include, for example, royalty financing with respect to the anticipated growth of the product, and there’s interest there.
And then more classically follow-on offerings for the business and potentially even a modest amount of debt. So those are things that we’re all evaluating. But I think, again, the most important point for everyone here is when we look at our business plan to include cash, cash equivalents, anticipated revenue from ELAHERE, and also, we’ve got this very broad portfolio of partnering agreements that include multiple folks with very active programs to include, for example, , who expects to file with the Chinese FDA that we would get a milestone payment upon filing, and that’s coming in the second half of this year. So all that stuff gets excluded from the accounting analysis, but when we look at the full business plan, we’ve got more than 12 months of cash.
Jonathan Chang: Got it. Thank you.
Operator: Thank you. Our next question comes from the line of Peter Lawson with Barclays. Your line is now open.
Peter Lawson: Great. Thanks for taking the question. Just the plans around the build out for the commercial infrastructure in the EU. And does your expense guidance include that EU court?
Mark Enyedy: It does, it does. I mean, obviously, in 2023, that’s going to be pretty limited. So we do have, ahead of our international business, we have a mighty one-room office in Zug as we speak, which is the start of what we’re doing. .But the MAA filing would come later in the year. Approval would come in 2024. And for many of you who have experienced following products being launched in Europe, the actual launch and commercial sales are sequenced according to reimbursement at a national level. So like many companies, we expect to start with Germany, but that would be very late in 2024. So we can approach this in a very judicious way. Obviously, we’ve had some very robust clinical development in Europe from all of our pivotal studies and will have for GLORIOSA and 420 as well.
So the experience base among ovarian cancer treaters in Europe is already pretty rich as it relates to ELAHERE use. So I think we start with a strong base — it’s a very concentrated market, Peter, so the last market research we did, just looking at the key five countries, more than 70% of patients are treated at just 65 centers. And of course, we’ve got a significant overlap with those centers in terms of where we’ve gone with our clinical trial. So again, we are approaching this in a judicious manner and the incremental commercial investment required to tap into a market with that level of concentration is very manageable.
Peter Lawson: Got you. And then just as regards to diagnostic testing, how is that going? Any wrinkles that developed? Or is it going smoother than expected, just any details around that.
Mark Enyedy: Yes. So we had a chance to catch folks up a little bit earlier on the call, I think, before you joined, Peter. But the testing, frankly, has just exceeded our expectations. So we did 1,500 tests between the approval date and the end of the year. The volume of testing has increased. The ease of testing has not proven to be a barrier to entry. And I’ll just repeat what I said earlier, which was this is a physician base that is highly accustomed to testing. In fact, their receptivity to it exceeded our expectation, and that’s because they started out more than half a decade ago looking for BRCA mutations, moved on to homologous recombination deficiency testing. And so the layering in of folate receptor alpha has proven to be quite easy for these folks. They’ve integrated it. And what we’re seeing is a significant percentage of newly diagnosed patients being assessed for their FR alpha status, which we think is very encouraging.
