Greetings and welcome to the Incyte Corporation First Quarter 2015 Earnings Conference Call. At this time, all participants are in a listen-only mode. A question-and-answer session will follow the formal presentation. As a reminder, this conference is being recorded. It is now my pleasure to introduce your host, Michael Booth, Vice President, Investor Relations. Thank you, sir. You may begin.

Thank you, Jessie. Good morning and welcome to Incyte's First Quarter 2015 Results Conference Call. Hervé Hoppenot, our CEO will begin with a few words summarizing our recent accomplishments; and Jim Daly, who leads our commercial organization, will then provide a commercial update on Jakafi. Rich Levy, who is in charge of Incyte's drug development activities, will update you on our clinical portfolio; and Dave Gryska, our CFO, will describe our first quarter financial results. We will then open up the call for Q&A for which we'll be joined by Reid Huber, our Chief Scientific Officer. On the call today, we will be discussing Jakafi, which is FDA approved for patients with intermediate or high-risk myelofibrosis and for patients with polycythemia vera who have had an inadequate response to or are intolerant of hydroxyurea. In addition, we'd like to remind you that some of the statements made during the call today our forward-looking statements, including statements regarding our expectations for the commercialization of Jakafi, our development plans for Jakafi and other indications and for other compounds in our pipeline, and our planned European expansion. These forward-looking statements are subject to a number of risks and uncertainties that may cause our actual results to differ materially, including those described in our 10-K for the year ended December 31, 2014 and from time to time in our other SEC documents. Hervé. Hervé Hoppenot - President, Chief Executive Officer & Director: Thank you, Mike. Good morning, everyone. We have had a very productive start to 2015, and I will just briefly summarize some of the highlights. Firstly, ruxolitinib sales in the U.S. and the rest of the world are going very well, reaching a growth rate above 60% in Q1 on a year-on-year basis. We also received a $25 million milestone payment from…

Thank you. Our first question is coming from the line of Cory Kasimov with JPMorgan. Please proceed with your question.

Hey. Good morning, guys. Thank you for taking the question. I have two of them for you. First of all, Jim, I realize we'll get a more detailed update on PV this summer, but thus far in the launch are you able to comment on what you see as the key gating factor to get a doc to initiate treatment and how you think that might change going forward? And then the second question I have is probably for Dave, and it's on the longer-term tax rate for the company and how that might be impacted by your new European operations. I'm just curious outer years, how we should be thinking about that? Thanks a lot. James M. Daly - Chief Commercial Officer & Executive VP: Hey, Cory. This is Jim. Cory, I think the key gating factor to getting a physician to prescribe Jakafi for their PV patients is translating the clinical data and the indication statement in the label to a specific patient in their practice. And I wanted to give a hats off to our sales force because, quite frankly, there's no substitute for an effective sales force in accomplishing that because it requires a discussion with the physician of particular patient characteristics and they're doing an outstanding job. As you would expect, the patients that we're getting right now tend to be the and patients. These are patients who tend to have elevated counts, and substantial symptom burden, and they tend to be at risk for thrombosis. And the sales force is having that constructive discussion. They're able to identify that patient as an appropriate candidate for Jakafi. The results are positive. And with that successful experience, they earn the right to go back and ask for additional patients who may not be as obvious, may not be the and patient, but may be the or patient. So I think that process is taking place. I think our sales force is doing an outstanding job. There is no substitute for an effective sales force in achieving that gating event. And as we look at new patients starts on a weekly basis, we're pleased and it's very consistent with our expectations. David W. Gryska - Chief Financial Officer & Executive Vice President: Cory, this is Dave. On your second question, we have no long-term guidance at this time on the tax rate. We're still working other strategies, and we'll update you at a later point on that.

Okay. Understood. Thank you.

Thank you. Our next question is coming from the line of Salveen Richter with SunTrust. Please proceed with your question.

Thanks for taking my questions. Just with respect to physician education for PV, do you see any difficulties translating the spleen response into patient benefit? I think that was a question in the New England Journal of Medicine. And then a second question on the JANUS trials, just wondering if there was FDA input as to why JANUS 1 would be sufficient for approval here? Are the PRO feedback just not required here? Thanks. James M. Daly - Chief Commercial Officer & Executive VP: Yes. With respect to splenomegaly, some of the early patients that are going on Jakafi do tend to have enlarged spleens. We see that becoming less important as a trigger to treat over time. So at this point, we're not seeing that as a barrier to identify new patients for Jakafi. Richard S. Levy - Chief Drug Development Officer & Executive VP: So, Salveen, your second question. So when we first were in discussions with the FDA during the SPA period going back about a year-and-a-half, it was clear that if the results were robust in JANUS1 that would be all that was necessary. JANUS2 was designed in case the results weren't as robust as we expected. When I say robust, there's no specific definition of what that means, but the expectation is clear that if we were even close to the confidence – excuse me, to the data that we saw in the RECAP study that would be a robust study. So we just have to wait and see on that. With respect to the PRO that's in JANUS 2 and not in JANUS1, that's still only an exploratory endpoint in JANUS 2 and would have no impact on approval. That was there to kind of demonstrate that that tool was fit for purpose, as they say in regulatory terminology these days, to potentially be used in additional study at later point to get a labeling claim based on symptoms. So that has no impact on the potential for approval.

That's helpful. Thank you.

Thank you. Our next question is coming from the line of Matt Roden with UBS. Please proceed with your question.

Great. Thanks very much for taking the question. Jim, I wanted to ask you about the sustainability of the current run rate for Jakafi. I'm tempted to infer from the components of growth that you broke out in your prepared comments that this trend, in fact, is sustainable, possibly even with upside because of the donut hole here. But also just want to get a sense for the inventory you mentioned has climbed up into the normal range. It sounds like there shouldn't then be a giveback in the second quarter. And then related, Jim, can you comment on what percentage of the sales in the quarter came from PV and whether or not there's any evidence of a bolus of patients coming on that may impact sequential trends later this year? James M. Daly - Chief Commercial Officer & Executive VP: Okay. Let's knock those off. First, let's start with the last because I remember that most vividly. No bolus of patients with PV. We should not see an inventory giveback in the second quarter. If you look at the sustainability of the trends, there is a natural seasonality to our business. If you look at the last two years, we had single-digit dispense growth in the first quarter for both 2014 and 2013, followed by robust double digit in the second quarter. Not making any forward projecting statement, but I would bet the trend on that. And we are very confident that we can maintain a robust growth trajectory for Jakafi both in MF and you'll see the compounding effect of our success in PV over time.

So in the absence of a real bolus, I mean, it sounds like you definitely got patients on drug and PV, but this is something you would see as more of a slow and steady gain as opposed to a step-up and then sideways. James M. Daly - Chief Commercial Officer & Executive VP: Absolutely. No step-changes with PV. PV is – you have to go out and earn it every day, patient by patient and we're doing that. And again, based on very early data, we're pleased with the rate of new patients going on for PV. And we're also pleased with the fact that, again, based on very early data that they seem to be staying on Jakafi and PV to a greater extent than what we saw with MF. So we think this is a slow steady build that will compound very nicely over time.

Great. And then if I may do a quick question for Rich here. You have the IDO and Yervoy combination data. If I'm not mistaken, that's to be presented at ESMO. And we understand that this combo with Yervoy isn't strategically as important to you, but can you give us a sense of what we may expect to learn from those data about IDO itself? Richard S. Levy - Chief Drug Development Officer & Executive VP: So the number of patients from which we will have data at ESMO is about twice the number that we had data when the data was first presented at ASCO last year. And secondly, the duration of therapy in the patients who have been on therapy for a while is longer. That's all I really feel comfortable saying about the data at this point in time. And I don't really know how to answer the question as to how you would translate the data in combination with Yervoy to expectations around the data with PD1s or PD-L1s other than to say that we're seeing that this is an active drug in immuno-oncology in combination with Yervoy. And that gives us confidence the same way as it has before, that we will see that it remains active and adds benefit to other immuno-oncology combinations including PD1s and PD-L1s.

Okay. Thanks, Rich, and thanks for taking the question.

Thank you. Our next question is coming from the line of Steve Byrne with Bank of America Merrill Lynch. Please proceed with your question.

So Jim, with respect to the results in MF, looks like maybe you're near 30% penetration or something in that range. Would you say that looking forward that the opportunity is more to drive up that percentage of patients within the haem-oncology community? Or do you think that there's more opportunity by reaching docs that are currently not using rux in their MF patients? James M. Daly - Chief Commercial Officer & Executive VP: That's a very fair question, and I hate to sound like I'm hedging, but I think the answer is both. I think with the overall survival data inclusion in the label, we saw an increase in both the breadth of prescribing, we saw physicians who had never prescribed the product begin to trial and adopt. And we saw a greater depth to prescribing. Now, with the second indication in PV, we're actually seeing physicians going back and evaluating some of their watch-and-wait MF patients and some of the later-adopter physicians seeing that as a motivation to initiate their first patient in MF. Actually, as you look at the prescribing for PV, 25% of prescribers in PV had never prescribed a product before in MF. And with positive experience in PV, we think there may be a halo effect for them to go back and use the product in MF. So I think we're optimistic that we can see an expansion in both breadth and depth in MF going forward.

And is the doc feedback so far in PV suggest support for that prior estimate of 25% of PV patients could be eligible for Jakafi? Do you still feel comfortable with that? James M. Daly - Chief Commercial Officer & Executive VP: I think we feel more confident in that estimate today than we did last year when we communicated it. The patients are definitely there without a doubt, and it's simply a matter of establishing successful trial and making sure the physician and the patient has a positive experience and then asking for the next patient.

And then just one for either Reid or Rich, and that is based on the data that you presented last week on the mechanism of action of rux, specifically, on effector and suppressor cells, do you see the longer-term opportunity in combinations with other specific therapies, I would say in contrast to the JANUS studies, which are simply an add-on to capecitabine? Where do you see that opportunity longer-term? Reid M. Huber - Chief Scientific Officer & Executive VP: Yeah. This is Reid, Steve. So I think we've always been interested in exploring the JAK inhibitor franchise we have in combination with both cytotoxic chemotherapies as well as targeted therapies. The biology I think has instructed us pretty well over the years that there is a clear opportunity for JAK-STAT pathway inhibition to augment and improve the effectiveness of both of those agents. You're asking quite different clinical questions, and you're talking about different patient populations, but I think as you see in the emerging solid tumor development program and I think as you'll see going forward in the development program with new studies starting over the rest of this year, this will continue to be two important themes that will emphasize targeted combinations as well as combinations with cytotoxics. Richard S. Levy - Chief Drug Development Officer & Executive VP: Yeah. Just to add that, we're studying both. We have clinical data with Jakafi added to capecitabine and emerging data with other agents, both targeted outside of immuno-oncology as well as other cytotoxic agents. And we have a very interesting pre-clinical data suggesting that it will work in combination with immunotherapies, but we need to first start exploring that data in the clinic before we can really make prioritization decisions.

Okay. Thank you.

Thank you. Our next question is coming from the line of Michael Schmidt with Leerink. Please proceed with your question.

Hey. Good morning, and thanks for taking my question. I had one regarding your comment on the IDO PD1 inhibitor study, combination studies. You said you may go directly into pivotal studies following the ongoing Phase I/II trials. And I was just wondering in the context of the evolving PD1 inhibitor landscape and some indications, in particular, in lung cancer, and with some of your partners such as Roche and Bristol now also developing their own IDO inhibitors, I was just wondering if you could talk about your overall strategy with regards to accessing a PD1 inhibitor? Either are you continuing to broadly look at this in an indication basis, irrespective of specific PD1 antibody? Or are you actually evaluating a possible – pursuing a specific PD1 antibody in the future as opposed to a broader scheme? Thanks. Richard S. Levy - Chief Drug Development Officer & Executive VP: So we believe we have an IDO1 inhibitor that has no issues with it and that is pretty far ahead of the competitor of IDO inhibitors there are going to follow. And that is the reason why we continue to move forward quickly to maintain our advantage in terms of timelines, which is critical. And our strategy remains to work with a range of drugs, not just across companies with different PD1s and PD-L1s but also potentially to look at other combinations as well, and not to have those decisions be driven by the potential that other IDO inhibitors that are further behind are going to be either licensed to or available to some of the same companies that we've been working with.

Okay. Great. Thank you.

Thank you. Our next question is coming from the line of Ian Somaiya with Nomura Securities. Please proceed with your question.

Thanks for taking my question and congratulations on a great quarter. My question relates to the Galapagos and AbbVie Phase II results in RA. I was just hoping to get your thoughts on the data we've seen from their compound and how we should think about a selective JAK1 inhibitor versus more of a JAK1/2 inhibitor and the safety and efficacy profile we should expect for baricitinib? Richard S. Levy - Chief Drug Development Officer & Executive VP: Sure. So I'm not going to try to get into and dissect the limited details that have been put in the public domain on the Galapagos results in Darwin 1 and Darwin 2. All I would say is that at this point, we don't see any types of strong evidence for differentiation between that product and baricitinib, which is several years ahead. And we look forward to sharing the Phase III baricitinib data with everyone in more detail soon.

But this doesn't motivate you in any way to maybe evaluate some of your JAK1 inhibitors in the RA setting or autoimmune setting? Richard S. Levy - Chief Drug Development Officer & Executive VP: So are JAK1 inhibitor, since we've put 39110 into a relatively small three-month study and showed quite interesting results. But we decided that 39110 was going to be an oncology drug. We then took a second JAK1 inhibitor and put it into the clinic for RA and had a tox finding that was not necessarily drug related, but one that made the development more difficult. So now we'd be talking potentially about another JAK inhibitor that's even further behind. And so you need to look not only at JAK1 versus JAK1/2, but also the timelines to bring forth another JAK1 inhibitor into this competitive space at this time.

Okay. If I may, just one other question I had. Just some of the increased productivity we're seeing on the R&D side is that a function of new process, new personnel, or just your willingness to invest in your pipeline drugs? Richard S. Levy - Chief Drug Development Officer & Executive VP: So I mean, I think we've always been highly productive, but the size and scope that we have available to do as many projects as we're doing, just pound for pound, I'm not sure that we're any stronger than we were before, but we've always been strong. We're building and we're building with the same quality of excellent people that we've had in the past to be able to maintain not only how rapidly we progress things, but to put in strong, strategic thinking into what we do so that we're not having to redo our plans on a constant basis. So I'm very pleased with the growth of the development organization. And as I said in my prepared remarks, really happy to have Steven Stein with us to lead the clinical group.

Okay. Thank you very much.

Our next question us coming from the line of Eric Schmidt with Cowen & Company. Please proceed with your question. Eric T. Schmidt - Cowen & Co. LLC: Good morning. Just one quick question left for Rich. It's on ruxolitinib and the lung cancer trial. You've been saying that it's been a little bit slow to enroll now for a couple of months. And obviously, the PD1s aren't going away. So do you need to re-jigger the protocol there? Or what are your plans for trying to accelerate and execute in a day and age where there's so many, I guess, ongoing changes in the I-O space. Richard S. Levy - Chief Drug Development Officer & Executive VP: Right. So it's an ongoing process to evaluate what the next steps should be. And being realistic not only about the competition for enrollment in the studies but the changing landscape over the way lung cancer is likely to be treated by the time these studies read out. So we're continuing to look at that, but we don't have anything specific to say at this point in time. Hervé Hoppenot - President, Chief Executive Officer & Director: Hervé here. I think it's important to realize that the field we are operating in in cancer for certain indication is moving extremely fast, with big steps happening with some new strategies. So the idea that in general there will be changes in direction depending on how data are emerging from other strategies is something we have to deal with now for the next 10 years. So in general, what we see in lung cancer where there was a sort of a tradition for 20 years of taxol/carbo followed by gemcitabine or fluoxetine or something like that is changing completely as we are at the same time developing our own portfolio. And obviously, it's going to change as the standard of care is evolving. And it's not true only for lung cancer. I think there are a number of tumor types where we see the immuno-oncology wave being very successful very rapidly where we will observe the same type of thing. So I don't think there should be any sort of surprise that there are some of our programs that are going to change directions. It could be the case depending on what we see in our early data there. But in general, it's something we need to get used to for the future. Jessie, the next question, please?

Yes. We'll move on to our next question which is coming from the line of Liisa Bayko with JMP Securities. Please proceed with your question.

Good morning this Masha for Liisa. Question for Rich. Could you please discuss rationale for evaluating lower dose of JAK1 inhibitor in first-line pancreatic? I guess more specifically, do you have any additional data on what side effects or reasons for patients discontinuing? Is that a function of chemo? And I guess, what are the implications for evaluating 110 in other solid tumors? Thank you. Richard S. Levy - Chief Drug Development Officer & Executive VP: Okay. So first in terms of the dose. So as I've said previously, we saw a higher-than-expected discontinuation rate in first-line pancreatic cancer patients in the expansion of the existing study and those in months, two, three and four. And we could not find any pattern among them. I don't think there were necessarily any two reasons for discontinuation that were the same. And none of them appeared to me to necessarily be related to the drug and necessarily be related to the dose. That said, because the discontinuation rate was higher than we expected, we didn't want to go into a large registration study taking the risk that the discontinuation rate early was going to inhibit our ability to see a positive result in the end. And so, we had essentially two choices. One was to just get more patients at the dose that we've already been studying or to study a lower dose. Or potentially, we could have continued to do both. But we wanted to be not so exhaustive in what we did fix that we would be adding too much time to this. So we decided that let's look at a lower dose, a dose that should still provide levels of JAK1 inhibition as high or higher than ruxolitinib provides in the positive RECAP study analysis. And so, we feel comfortable with that lower dose. With respect to whether this has any impact on our JAK1 in terms of other solid tumor combinations, I don't think that it does. I think that we don't even know that this has anything to do with the JAK1. We don't know this has anything to do with the combination with gemcitabine and abraxane. And we don't even know that this just isn't because the numbers of patients was relatively small and this lead-in to just by chance get a higher discontinuation rate. So we're being prudent, but I wouldn't look at it impacting anything else.

Thank you.

Thank you. It appears we have no further questions at this time. I would like to turn the floor back over to Hervé for any additional concluding comments. Hervé Hoppenot - President, Chief Executive Officer & Director: Thank you. And thank you all for your time today. As we said at the beginning, I think it was a very successful first quarter with the fast-growing top line. And as you heard also, a fast, expanding portfolio of clinical projects. We are looking forward to a series of important and exciting events over the next several months. And I just want to thank you again for your time on the call today. We look forward to talking to you at the second quarter conference call in early August. Thank you.

Ladies and gentlemen, this does conclude today's teleconference. We thank you for your participation and you may disconnect your lines at this time.