Apellis Pharmaceuticals, Inc. Q1 FY2024 earnings call

Management Statement and Operational Highlights:

• SYFOVRE: Strong Q1 growth driven by demand acceleration. Over 250,000 injections administered through March. First 12 months of launch exceeded sales expectations. Market leader in GA with ~85% of treated market. Investing in marketing and DTC initiatives. Distributed 72,000 commercial doses and 5,000 samples in Q1; over 2,000 sites of care using SYFOVRE.
• EMPAVELI: Generated $26 million in Q1 revenue. Focus on expanding into new indications like C3G and IC-MPGN. Phase II NOBLE data showed promising results. Involved in xenotransplant surgeries. Phase III VALIANT study data expected mid-2024.

Segment Performance:

• SYFOVRE: Generated $137 million in net sales in Q1, up 20% from Q4. In the first 12 months of launch, over $400 million in sales. Contributes approximately 80% of total revenue (137.5 million out of 172.3 million total revenue).
• EMPAVELI: Generated $26 million in revenue for the quarter. Contributes approximately 15% of total revenue (25.6 million out of 172.3 million total revenue).

Guidance:

• SYFOVRE: Expect continued growth in Q2 and beyond, with strong demand from physicians and patients.
• EMPAVELI: Anticipates pressure on sales in medium term due to competition but focuses on expanding into new indications. Awaits top line data from Phase III VALIANT study in mid-2024 for C3G and IC-MPGN.

Risks:

• Competitive pressure in GA market from new entrants like IZERVAY.
• Procedural delays in EU regulatory review process for SYFOVRE.
• Vasculitis rate, though rare and stable, was a concern initially.

Question and Answer: Q: Competitive dynamics in GA, how to square market share reported by Astellas vs. Apellis?

A: Apellis measures market share by patients treated, while Astellas uses vials distributed. Apellis is the #1 chosen GA therapy and expects growth to continue.

Q: EU process for SYFOVRE, is it good news or bad?

A: It's a procedural delay not related to SYFOVRE's approvability; approvability remains the same.

Q: Seasonality impact on SYFOVRE growth, rate of growth going forward?

A: Q1 had growth with slight dip in February, but strong growth in March and continuing into Q2. Confident in strong future growth.

Q: Switching rates between SYFOVRE and IZERVAY?

A: Strong majority of new starts choose SYFOVRE; some sites switched but are coming back. Vasculitis rate is rare and stable.

Q: VALIANT study readout expectations?

A: Excited about Phase III VALIANT study data in mid-2024, looking for significant reduction in proteinuria in C3G and IC-MPGN.