Ying Huang: Yes. So, Ash, let me talk about how we plan to get to that 10,000 number by end of 2025. So, first of all, we have three internal nodes, right, in Raritan, like I mentioned earlier in this call, we already got two increases in capacity last year, and we’re planning something similar this year. And we’ll continue to do that in the year of 2025 as well. So that’s part of that. But beyond that, we and J&J are doing actually the physical expansion of the Raritan site. So, essentially, after this physical construction is done this year in 2024, we’re doubling our effective area of manufacturing in the Raritan site. So that will also figure into the capacity increase in the year of 2025. Because once the physical construction is done this year, we’ll spend months installing the equipments, training the staff, and then get all the suites validated on the current GMPR standard.
So that’s an important part of the Raritan increase. Right? And then let’s talk about the two other nodes in Belgium. So the first one is called Obelisc, which is a standalone building released. That started clinical batch production in January. And our plan is to bring that site to commercial production for European demand by end of this year. So towards the end of this year, we’ll have another commercial note at Ghent. And then the much larger facility called Tech Lane , which is roughly 240,000 square foot by design. The physical construction will be done by end of this year. So our plan is to bring that Tech Lane facility to clinical production early next year. And again in the second half of 2025, that Tech Lane facility will enter into commercial production mode.
So those are the three internal nodes, and those are very important cornerstone strategy how we can get to that 10,000. Now, beyond that, you guys all know we executed a three way agreement with Novartis last year. It was for three year clinical supply. Right now, we’re expecting Novartis to file for IND potentially first half of this year. And after that, pending the FDA approval of the IND, Novartis will start to produce clinical trial material for us. So that external CMO strategy is also an important pillar of our strategy to get to that 10,000. So all this combined by end of 2025, we’re on track at this point to get to that 10,000 dose annual capacity.
Ashwani Verma: Thank you.
Ying Huang: Oh, and last, I think, Ash, you asked about the revenue split. Obviously, it’s way too early for us to comment because right now, whatever revenue we generate for CARVYKTI from Europe, it’s all really by allocation because there’s only so much capacity we could allocate to Europe. But in the future, once we have enough capacity to satisfy demand from both the US and European demand, then if you look at some of the prior CAR-T revenue split, it’s usually roughly maybe 50:50, slightly favoring the US and then the ex-US especially, European revenue is just shy of 50%. So we think that should be the same dynamic for BCMA CAR-T in myeloma.
Operator: Thank you. Our next question comes from Edward Tenthoff with Piper Sandler. Your line is open.
Edward Tenthoff: Great. Thank you very much for taking my question and I appreciate all the good color and the update today. Congrats on all the progress. So my question really has to do with kind of second line plus utilization. How do you envision physicians prioritizing patients assuming label expansion? Do you think that we’ll see CARVYKTI use move earlier line, as evidenced by the kind of superior results that we saw from CARTITUDE-4? Is it really going to be up to the sites how they’re allocating CARVYKTI? Any color on your early thoughts on that would be appreciated. Thank you.
Steve Gavel: Yes, why don’t I take that, since we just had some data read out specific to that question? So if you step back and look at the myeloma population segmented by standard risk versus high risk, that’s how we do it. And if you assume that of that high risk population, they represent about 25% of the total. And that’s pretty consistent across all lines of therapy. What our data is showing and we ran some research right after last year’s ASCO, when we released this data, and we actually just reran it recently, and it’s been fairly consistent. So based upon the results that Ying has shared earlier in terms of our CARTITUDE-4 data, we’re seeing for sure that 20% to 25% high risk group moving over, or physicians going very quickly with CAR-T therapy like cilta-cel up front in second line.
And then we’re also seeing, and this was a bit of a change, which was a positive change for patients is, yes, with — even within the standard risk population, physicians have said that they see them moving forward with CARVYKTI in standard risk, in second line plus that population as well. So that’s quite exciting. Now, as you know, that’s quite a sizable patient population for us, but that data, like I said, is fairly fresh. Now, we just had that read out here in the first quarter,
Ying Huang: I guess the last maybe tidbit of information drip this real quickly is that the new dynamic that this launch represents is a referral dynamic, especially in the standard risk group. So as opposed to our CARTITUDE-1 launch, which was pretty much most of those fifth line plus patients were already within our hospitals. Through our partner, and our partner is fully staffed, trained up and ready to go, they’ll be pushing from a referral front in the outpatient setting where most of these standard risk patients are today, to refer those patients that are CAR-T eligible to our site. So that’s the only, I would say, added wrinkle to the second line plus indication is really this active engagement in terms of referral from the outpatient clinics into our hospital.
Edward Tenthoff: Great. Super helpful color. I appreciate it and good luck this week.
Ying Huang: Thank you.
Operator: Thank you. Our next question comes from Justin Zelin with BTIG. Your line is open .
Justin Zelin: Thanks for taking the question and congrats on the progress. So Ying, I wanted to ask if you could give us an update on the out-of-spec rate that you’re seeing and your confidence on the FDA’s widening of the out-of-spec window with the most recent submission. Thanks.
Ying Huang: Hey, Justin, thanks for the question. So, I think what I can say is that in the last nine months or three quarter or so, the out-spec rating has been quite stable. Like we mentioned, it’s in the teens range. So at this point, we are seeing a very stable trend of OS and the next leg up would be pending the FDA approval. We hope we’ll get a wider release back and then we hope to have another significant reduction in the out-of-spec rate. Now, regarding the FDA approval, so, as you know, Justin, we did submit it in the supplemental BLA in June of last year, asking FDA to widen our release back based on the clinical data we received from CARTITUDE-4 data. So we provided a wealth of what I call the sensitivity analysis by correlating the release spec with the clinical outcome.
At this point, we are still confident that we should be able to receive the wider spec, but we don’t comment on detailed interaction with the agency. You’re going to have to wait and see when we receive the FDA approval, then we’ll let you guys know what kind the regulatory action the agency has taken. Thank you.
Justin Zelin: Thanks for taking my questions.
Operator: Thank you. Our next question comes from Mitchell Kapoor with H.C. Wainwright. Your line is open.
Mitchell Kapoor: Hey, everyone, Thanks for taking the questions. I have two. The first one is kind of on the strategy of moving into earlier lines, knowing that you’ll undoubtedly treat patients who would have otherwise been treated in the later line setting, can you kind of help us contextualize the true additional expansion opportunity of moving into earlier lines? And then the second is on the strategy of the sales force messaging, assuming a new approval in the earlier line setting, with new accounts, do you expect to ask the physician to potentially put patients on CARVYKTI in later lines first and then move to earlier lines? Or would you initially ask them to begin their patients in earlier line setting? Thank you.
Steve Gavel: Yes, thank you, Steve. Thanks for that question. That’s a good one. So we will be — obviously, we’ll be in launch mode with CARTITUDE-4, so we will be messaging hard, obviously the new indication, the second line plus nature of it, and all the patients that meet that eligibility criteria. So we will be really, from a messaging perspective, really dominating our messaging around CARTITUDE-4 and second line plus. As far as the eligible patient population, I could actually give you some numbers here that may help you. And these are folks who patients — these are global numbers that meet the eligibility criteria, not necessarily a treated population, but at least the patients that are eligible. This may help with some of your math in your modeling.
So in the frontline setting, this is a global number. We foresee about a 22,000 patient opportunity globally, CARTITUDE-4, there’s about a tripling of that moving to 60,000 by about 28,006 around the same number, 20,000 to 28,000. So hopefully that will give you some perspective in terms of an incremental impact as we go into earlier lines.
Mitchell Kapoor: Great. Thank you.
Steve Gavel: You got it.
Operator: Thank you. Our next question comes from George Farmer with Scotiabank. Your line is open.
George Farmer: Hi, good morning. Thanks for taking my questions. You guys mentioned 80% market share of CARVYKTI in multiple myeloma versus Abecma. Can you comment on what’s driving that decision for physicians to use Abecma even in the first place? And do you think that can improve? And then second question, maybe I missed this. Are you still guiding for profitability in 2026?
Steve Gavel: Hi, this is Steve again. We had a little mechanical difficulty on our end. Could you repeat that first question? I think the question was related to Abecma and Abecma use.
George Farmer: Yes. So you guys said you had like 80% market share, right? And just like wondering what’s driving that decision to even use Abecma, do you think, and over CARVYKTI and can you improve upon that? And then the second question had to do with profitability in 2026. Is that still a message you guys are communicating?
Steve Gavel: Sure, I’ll. I’ll take the first one. Reconnected. Sorry, guys, I have some WiFi problems and they got alright here. Can You guys hear me, okay, on your end?
George Farmer: Yes.
Steve Gavel: Okay, good. Okay. I think the first question had to do with, once again, Abecma use and why even bother using Abecma, I think what’s happening here, and this is the research now speaking, is there’s still a large number of patients in the supply and setting that we just, quite frankly, can’t satisfy yet. So therefore, thankfully, there’s another CAR T therapy available, and you’re seeing Abecma use in that setting. It’s quite — it’s that simple. The other thing to think about and we — in the United States, we don’t have marrying territories or commercial maps, so to speak. We’re not all in identical centers. So in some centers where Abecma is, obviously they’re the only CAR T in towns are going to get Abecma. But that doesn’t happen very frequently. So that is the other area where you might see some of Abecma used just in terms of their commercial footprint being a bit different than us. Lori, do you want to talk about profit?
Lori Macomber: Sure. So the messaging is still consistent with profitability for 2026. We’ve talked about bridging to profitability for the BCMA program. What’s going to be critical there is our penetration into earlier lines of therapy and kind of our uptake down to revenues and continuing to drive our COGS down. And then the other component of that is really I talked about earlier, is our pipeline advancement. So by 2026, we are projecting that we can break even or be profitable from an overall company perspective.
George Farmer: Great, thanks very much.
Operator: Thank you. Our next question comes from Gena Wang with Barclays. Your line is open.
Gena Wang: Thank you for taking my questions. Sorry, I dialed-in late, so apologize if those questions already being asked. So our first question is regarding I think you mentioned that in the past, by the end of 2025, your capacity can reach 10,000 doses. And what would take for you to reach 20,000 to 25,000 doses, and how long would that take? And then second question is regarding ODAC that — later this week. So maybe if you can share like what kind of data you submit to the FDA. And do you expect some discussion regarding the toxicity profile, such as a neurotox?
Ying Huang: Hey, good morning, Gina. This is the Ying. I’ll take your questions. So, on the first one, I think I’ve commented previously that with this current run of very extensive capital investment between us and our partner J&J, we think we can go beyond that 10,000 and potentially go to a numbers, you quote it, it will take some incremental investment and it will take probably another couple of years to get there. But at this point, I would rather not share any details around that. Just suffice to say that, yes, we’ll go beyond 10,000 with this current round of CapEx and also potentially help from our external partners on our CMO side. So that’s the answer for your question, the first question. And then the second one regarding ODAC, I can tell you that it’s very clear from the FDA communication in writing and also verbally, that the focus of the ODAC will be discussing the overall survival benefit CARVYKTI provides in this patient population evaluated in the CARTITUDE-4 study, and in the context of some early imbalance, which you have seen from the PFS curve.
Right. So that’s really the focus of the ODAC here in terms of what they’re focusing on. Now I’m sure it’s a four hour ODAC session, and in any ODAC meeting, they always talk about the overall risk benefit, and that probably will touch upon also some of the adverse events, including CRS, neurotox, second primary malignancies. But like I mentioned, again, the survival is the focus. The survival benefit is the focus, not the SPM issue or neurotox issue at this point, based on what we heard from FDA. Thank you.
Operator: Thank you. Our next question comes from Kelsey Goodwin with Guggenheim. Your line is open.
Kelsey Goodwin: Oh, hey. Good morning. Thanks for taking my questions. First, I guess, how should we think about the first quarter 2024 sales, given kind of the step up in the back half of 2023 and likely not being fully recognized given the fourth quarter sales that we saw. And then secondly, on the AdComm, so given both are on the same day and crossover is obviously a main focus, could you remind us the rationale for not allowing crossover in CARTITUDE-4? And do you think that that might be a hang-up for the FDA in any way? Thank you.
Lori Macomber: So for quarter-over-quarter growth, we’re not giving specific guidance, but I can tell you we do anticipate quarter-over-quarter growth with more pronounced growth in the second half of the year with the anticipated launch into the second line setting. Ying, I don’t know if you want to talk about crossover.
Ying Huang: Sure. So thank you for the question, Kelsey. As you know, there’s some difference between the two trials. And in the CARTITUDE-4 study, we did not allow crossover, which means we did not provide the patient who progressed on the standard of care to cross over to cilta-cel once they progress. However, once the patient progresses on standard of care op, they can actually get any commercially available therapy, including the two commercially available CAR T therapies and also the commercially available bispecifics. And also they can enroll into clinical trials. So you will see some of the details on Wednesday when the briefing book comes out, what those subsequent therapies those patients receive. But I can tell you, yes, there are patients who did receive CAR T therapies after progression.
So that’s the fact. Now, on the other hand, even though we did not allow the crossover, but before we started enrolling patients, we actually had a very frequent communication with both FDA and also EMA as global regulators to talk about the protocol of CARTITUDE-4, including the — not allowing the crossover design. So at this point, I don’t think that will be a big focus of debate here at ODAC.
Kelsey Goodwin: Perfect. Okay, thank you so much.
Operator: That’s all the questions we have for today. Thank you for your participation. You may now disconnect. Everyone. Have a great day.
