PUMA BIOTECHNOLOGY, INC. Q3 FY2024 earnings call

• Clinical Review: Puma has an ongoing Phase 2 study of investigational drug alisertib in small cell lung cancer. The ALISCA-Lung1 trial has 20 patients enrolled, with improved neutropenia and tolerability observed. The company is considering increasing the dose of alisertib monotherapy. There's also a Phase 2 trial of alisertib in combination with endocrine treatment in breast cancer set to start in Q4 2024. - Commercial Performance: The commercial team focuses on increasing NERLYNX utilization. HCP call activity increased 11% quarter-over-quarter and 17% year-over-year. The majority of business flows through the specialty pharmacy channel. Q3 saw NERLYNX receive regulatory approvals in Algeria and launches in South Africa and the United Arab Emirates. About 65% of patients started NERLYNX at a reduced dose in Q3. - Financials: Net income in Q3 2024 was $20.3 million. Gross revenue from NERLYNX was $67.7 million. SG&A expenses were $16.8 million, R&D expenses were $12.5 million. Cash burn was $0.1 million in Q3, with cash, cash equivalents, and marketable securities totaling $97 million as of September 30, 2024.

Puma Biotechnology reported total revenue of $80.5 million for the third quarter of 2024. Product revenue net, which is entirely from NERLYNX sales, was $56.1 million in Q3 2024, accounting for approximately 69.7% of the total revenue. Royalty revenue was $24.4 million, making up about 30.3% of the total revenue. In Q3 2024, 2,723 bottles of NERLYNX were sold, an increase from the 2,515 bottles sold in Q2 2024. New prescriptions saw a 3% increase quarter-over-quarter, while total prescriptions were essentially flat. Inventory increased by about 37 bottles in Q3.

For fiscal year 2024, Puma anticipates NERLYNX net product revenue to be in the range of $187 million to $290 million. The gross-to-net adjustment for full year 2024 is expected to be between 20.5% and 21.5%. Royalties for 2024 are projected to be in the range of $34 to $36 million. For Q4 2024, NERLYNX net product revenue is forecasted to be between $46 million and $48 million. Q4 royalties revenue is expected to be between $3.5 million and $5 million, and license revenue between $1 million and $2 million. Net income for the full year is estimated to be between $15 million and $17 million.

Forward-looking statements are subject to risks and uncertainties where actual events and results may differ from those expressed. This includes risks related to clinical trial outcomes, regulatory approvals, market acceptance of products, competitive pressures, and the company's debt obligations and economic conditions.

Q: Good afternoon. Thanks for taking my questions, and congratulations on the quarter. Alan and Jeff, I just wanted to get your thoughts on the sales, exceeding expectations. What are you attributing that to when you dig down into it? And then also, how does persistence play into that? As you keep saying that as patients are using the lower doses, they remain on drugs longer. So I just wanted to get your thoughts on how that's playing through in the revenue numbers?

A: Jeff Ludwig responded that demand is promotionally sensitive, with efforts to get the sales force in front of customers at decision-making times. Leveraging claims data to target the sales force and improving conversion from enrollments to new patient starts are key. Persistence with lower doses leads to better bottles per patient, contributing to revenue.

Q: Hi, guys. Thanks for taking my question. I'll add my congrats on the initial data in lung cancer. Just a couple questions on that. Are the two patients that had a PR still on the trial as of the data cut? And then just in terms of expanding the dose or expanding the dose range potentially, do you have to meet with the FDA before looking at increased doses of Alisertib? And then how are you thinking about maybe how many doses you're planning on exploring? Is it just one or are you trying to go or are you trying to do like a sequential dose escalation to figure out kind of where you can get the most efficacy?

A: Alan Auerbach stated he didn't have data on the two patients with partial responses. He mentioned the licensing history of alisertib and discussed considering increasing the alisertib monotherapy dose. He also noted looking at increasing the dose in combination with paclitaxel and considering both monotherapy and combination doses for efficacy.

Q: Hi. Thank you for taking our question. So this is Jenny [ph] for Gina. So we have a question about ALISCA-Breast 1 cancers interim readout. So could you provide more color about the timeline? I mean, you mentioned, like, in a medical meeting, and then we wonder, like, how many number of patients data you would report. I think last quarter, it got the readout, it's like a fourth quarter of 2024, but why it is postponed to 2025? Also, like, what is the kind of the benchmark for this, like, activity?

A: Alan Auerbach responded that the ALISCA-Breast trial hadn't started enrolling yet. He discussed the biomarker-driven approach and previous trial results related to alisertib, noting the lack of a comparative view from prior monotherapy trials but seeing signals in the randomized trial for certain biomarker subgroups.