NovoCure Limited (NVCR) Q2 2016 Earnings Report, Transcript and Summary

Good day, ladies and gentlemen, and welcome to the Novocure Second Quarter 2016 Earnings Results Conference Call. At this time all participants are in a listen-only mode. Later we'll have a question-and-answer session and instructions will be given at that time. [Operator Instructions] As a reminder, this conference call is being recorded. I would now like to introduce your host for today's conference, Ms. Ashley Cordova. Ashley, you may begin.

Thank you. Good morning everyone, and thank you for joining us to review NovoCure's second quarter 2016 performance. I'm joined today by our Executive Chairman, William Doyle; our CEO, Asaf Danziger; our CFO, Wilco Groenhuysen; and our Chief Science Officer and Head of Research and Development, Eilon Kirson. The slides that will be presented today can be viewed on our homepage, www.novocure.com by clicking on the links for 2016 second quarter financial results, located in the events and presentation section in the lower middle column of the Investors page. Before we start, I'd like to remind you that our discussions during this conference call will include forward-looking statements and actual results could differ materially from those projected in these statements. These statements involve a number of risks and uncertainties, some which are beyond our control, including those risks and uncertainties described from time to time in our SEC filings. We do not intend to update publicly any forward-looking statement except as required by law. We will first make some brief prepared remarks and will then move to a question-and-answer session. I will remind everyone that our financials for the three and six months ended June 30, 2016 are available on our press release and our 10-Q, both of which were released earlier this morning. With that, I'll now turn the call over to Asaf Danziger.

Thank you, Ashley, and good morning everyone. I want to start with my key takeaways from the quarter. Year-over-year in prescriptions, active patients and revenue continued in the second quarter 2016 with sequential growth in active patients and revenue. We finished the quarter with 657 prescriptions and I'm proud of the progress we have made since FDA approval of Optune for newly diagnosed GBM in October. We did see 20% in prescriptions in the U.S. in Q2 compared to Q1 2016. While we would of course prefer to see growth in prescription every quarter, we have historically seen by our ability in the pace of prescription cost as practice patterns vary and we address the barriers to full adoption. These barriers include competition from some large high-profile clinical trials that specifically exclude from enrollment patients treated with Optune. Also, we need to educate and certify community of oncologists who will treat GBM in the U.S. and we continue our effort to do so. Finally, there is continued skepticism formed at Paul [ph] academic prescriber base that is voicing the desire to seek presentation of additional clinical trial data. Given the unfamiliarity with our new treatment modality, while the challenges include into bringing any noble therapy like Optune into widespread clinical use, I believe we have the right strategy and tools to overcome these challenges overtime. The results of our EF-14 clinical trial of Optune plus temozolomide demonstrate the first advance in the treatment of newly diagnosed GBM in more than a decade with significant improvements in progression frame overall in two-year survivals. The MCCM just recommended with unison consensus, Optune as the standard treatment option for newly diagnosed GBM in its clinical practice guidelines. We believe this recommendation will have a positive impact on demand especially in the community setting. We recently received FDA approval for our second generation Optune system which is less than half the size and weight of the first generation system and aims to make Optune even easier for patients. The second generation weighs 2.7 lbs compared to 6 lbs for the first generation Optune system and can be carried in a small over-the-shoulder bag rather than in a backpack. We have received very positive feedback from patients and prescribers in Europe and are excited to roll out the second generation Optune in the U.S. We continue to refine our service marketing and education efforts to ensure we maintain momentum within our existing base of core prescribers and also expand our base to include high volume prescribers in the community setting who are new to Optune. Our marketing messages focus on ensuring that prescribers understand the strength of the Optune data and that they have the tools needed to constantly present Optune for their patients. We also plan to publish in the future additional data on Optune for the treatment of patients with GBM including the 695 patients data set from the EF-14 file. Again, Optune is the first happy to demonstrate an improvement in overall survivor for newly diagnosed GBM in more than a decade and we are committed to bringing this noble therapy to patients who have such a vital need for better treatment. The second quarter was also our best quarter ever in terms of the extent of clinical pipeline development. I strongly believe that GBM is just the beginning for TTFields and Novocure. With that, I will hand the call over to Wilco.

Thank you, Asaf and good morning, everyone. 657 Optune prescriptions were received worldwide in the second quarter of 2016, representing 54% growth compared to the second quarter of 2015 and a 13% decrease compared to the first quarter of 2016. The prescription fill rate for the 12 months ended June 30, 2016 were 75% and the pipeline of 47 U.S. prescriptions represent an estimated penetration rate of approximately 18% for the quarter. While prescription volumes in the United States were less than we had anticipated for reasons Asaf has already mentioned, we saw a strong quarter-over-quarter growth in our ex-U.S. markets. EMEA markets represent at almost 17% of our global prescription volumes in the second quarter. Germany continues to be a largest EMEA market with approximately 75% over 2016 year-to-date ex-U.S. prescription volume. There were 891 active patients on Optune therapy as of June 30, 2016, an increase of 466 patients or 110% compared to June 30, 2015. And an increase of 94 patients or 12% compared to March 31, 2016. The year-over-year increase in active patients was driven both by prescription growth and by an increase in the percentage of newly diagnosed GBM patients who started Optune in prior periods and who typically have a longer duration of therapy. The portion of Optune prescription for newly diagnosed GBM was more than 50% in the second quarter of 2016. We continue to expand coverage of Optune for the treatment of newly diagnosed and/or recurring GBM in the second quarter of 2016. More than 10 million additional lives are now covered through new policies with Blue Cross Blue Shield of Michigan, EmblemHealth, Blue Cross Blue Shield of Minnesota and Group Health Cooperative Washington and Idaho. This brought the total number of covered lives to approximately 116 million in the United States, which is more than 60% of the privately insured lives as of June 30, 2016. Since the publication of our Phase 3 pivotal trial data for newly diagnosed GBM in JAMA, we have met significant progress in contract negotiations with many of the largest U.S. commercial pairs. We anticipate an increase in contracted lives that will positively impact our time to collection in future quarters and will also facilitate a transition to accrual-based revenue recognition. For the 12 month ended June 30, 2016, the average cash payments received continue to be more than $40,000 per charged month in the United States. The difference between billed and paid amounts consists of patient's financial assistance, charitable care, discounts, disputed underpayments and indirect taxes. Novocure's average time to collect on billed charged ranges between four and five months in the United States. Our time to collect reflects a wide distribution of payment tax from payers. It remains a reasonable assumption that revenues correlate on average to act of patient billings from two quarters prior to the quarter period. The payment amount and average time to collect metrics do not include our experience with patients covered by the Medicare fee for service program as we have not yet perceived material payments from that program. These invoices remain open as we appeal the coverage denials due to heavily backlogged administrative law judge control proceeding. The percentage of the U.S. active patient population over beneficiaries of the Medicare fee for service program continues to range from 20% to 25% in recent quarters. The payment amount and average time to collect metrics also do not include our experience outside of the United States as we do not yet have sufficient history with these payers to reliably report the payment patterns. As we enter each new market, our commercial activities focus initially on establishing the required end market infrastructure, certifying physicians to prescribe Optune and obtaining and define reimbursement pathway. Once established, our commercial efforts turn into increase in adoption of Optune within that market. Our 10-Q is filed early this morning and I would like to highlight a few key points before handling the call over to Bill. Given that Optune represents a new treatment modality and unique business model, US GAAP requires that we recognize revenue on a cash basis until we are able to build up sufficient history with each individual third party payer to reliably estimate that individual payment patterns. As a result, revenue in a reported period is a mixture of amounts collected for patients on Optune in the current period and amounts collected for patients on Optune in prior periods. Historically, revenues like active patient billings by approximately two quarters. Second quarter 2016 revenues increased to $17.9 million compared to $6.5 million for the same period of 2015, representing 174% growth. This growth was driven by increased demand for treatment with Optune after FDA approval of Optune for the treatment of newly diagnosed GBM in October 2015. Global revenues, included revenues outside the United States of almost $148 million in the second quarter of 2016 versus $0.4 million in the second quarter of 2015, reflecting the increasing scale of our global operations. We received FDA approval to market our second generation Optune system in the United States on July 30, 2016 and are in the process of converting all patients from the first generation to the second generation Optune system. We are no longer manufacturing the first generation Optune system. Based upon our decisions to cover active patients as quickly as possible, we recorded a non-cash impairment loss of $6.4 million for the write-off of first generation Optune system field equipment for the three months ended June 30, 2016. We plan to convert all patients in the United States from the first generation to the second generation Optune system over the next three months and do not expect an additional material impairment charge in the future. Net loss for the second quarter of 2016 was $40.6 million, compared to $29.4 million for the same period in 2015. Our balance sheet remains strong. As of June 30, 2016, we have $80.9 million in cash and cash equivalents and $120 million in short-term investments for a total balance of $249 million cash, cash equivalents and short-term investments. Our second quarter net cash used in operating activities was $29.4 million. In addition, we invested $6.6 million in PP&E and field equipment to support our commercial business. On June 30, 2016, we provided a drop-down notice for the remaining $75 million available under our existing term loan agreements with an investment fund managed by Pharmakon Advisers LP and we received the funds in July 2016. For the avoidance of debt, the net proceeds of $72.9 million are not included in the second quarter cash balance. We believe our current cash and investment balances are sufficient to fund our operations for at least the next 12 months. We remain committed to advance in TTFields and its approved indications as well as running a broad clinical development pipeline for additional indications. Depending on the ultimate base of commercial adoption and the timing of our Phase 3 pivotal trials across multiple indications, we believe our current sources of liquidity should be sufficient to fund our operations through profitability. I will now turn the call over to Bill for some closing comments.

Thank you, Wilco, and good morning, everyone. As we have consistently described, Novocure has a simple two point strategy. We are focused on transforming the standard of care for glioblastoma to include treatment with TTFields and we are committed to accelerating the development of TTFields for the treatment of a variety of other solid tumors. Scientific evidence suggests that TTField is broadly applicable across solid tumors and we currently have five ongoing or completed clinical trials in additional tumor types beyond GBM. Recent findings strengthen our belief that treatment with TTField is compatible with both existing standards of care and emerging therapies. In January 2016, we presented data from the first cohort of PANOVA, a Phase 2 pilot trial in advanced pancreatic cancer demonstrating the progression-free survival and overall survival of patients treated with TTFields combined with Gemcitabine for more than double dose of Gemcitabine treated historical controls. A sub group analysis of the first cohort of the PANOVA trial was presented at ASCO in June 2016, demonstrating an overall survival benefit of TTFields plus Gemcitabine in both locally, advanced and metastatic pancreatic cancer patients. Overall survival of patients with locally advanced pancreatic cancer treatment with TTFields, combined with Gemcitabine had not yet reached the medium after 15 months of follow-up. In May 2016, we received FDA approval of our IDE application to initiate our METIS trial. The multi sensor open labeled randomized study will test the effectiveness of TTFields following stereotactic radio surgery compared with watchful waiting alone in 270 patients with brain metastasis spending from non-small cell lung cancer. We are working closely with trial sites and institutional review boards to open sites so that patients can be enrolled as quickly as possible. Also in May 2016, we finished enrollment of two Phase 2 pilot trials; PANOVA and INNOVATE, studying TTFields in combination with standard-of-care therapies including taxane for advanced pancreatic and recurring ovarian cancers respectively. The six months follow up for both trials, Phase 2 pilot beta is expected to be available for presentation in late 2016. As previewed in our first quarter call, we presented results at the American Association of Immunologists annual meeting in May 2016, which demonstrated the TTFields' enhanced immunogenic cell death in non-small cell lung cancer cells invivo. Pre-clinical mouse data suggests that combining TTFields with anti-PD-1 therapies may improve tumor control by enhancing any tumor immunity. We are extremely excited to further explore the potential combination of TTFields and emerging immunotherapies. We have updated our LUNAR protocol design to capitalize on our potential synergies with taxane-based chemotherapies and our potential additivity with PD-1 inhibitors, LUNAR in the Phase 3 pivotal trial in advanced non-small cell lung cancer and we hope to enroll the first patient in late 2016. As mentioned at our press release, we will hold a researching development day for analysts and investors on Monday, December 12, 2016. The event will provide analysis from completed clinical trials including the 695 patient data set from our Phase 3 pivotal trial study in newly diagnosed GBM. Data from the PANOVA Phase 2 trial in advanced pancreatic cancer and data from INNOVATE Phase 2 trial in recurrent ovarian cancer. In addition, we'll provide an update of recent pre-clinical findings related to tumor-treating fields and a review of our ongoing clinical activities. We're excited to share new data and additional details on our development progress at this meeting. In closing, we are optimistic about the year-over-year growth that we continue to see as we build out Optune's commercial adoption in GBM. While we recognize the barriers to adoption still remain, we are optimistic that in time, we will overcome the challenges inherent in bringing a completely new therapy into widespread clinical use. Novocure is transforming the standard of care for Glioblastoma and we are dedicated to bringing Optune to as many patients that can benefit from this new treatment as possible. The broad applicability of TTFields across multiple solid tumor types, the compatibility of TTFields in combination with certain existing and noble therapies, and the potential of TTFields superior outcomes with no systemic toxicity give us the confidence that this technology will play a valuable role in the solid tumor treatment paradigm. With that, I would like to thank everyone for their time this morning and for their interest in Novocure. Operator, can we please poll for questions?

Thank you. [Operator instructions] And our first question comes from the line of Cory Kasimov of JP Morgan. Your line is open.

Hey, good morning. This is Morgan on for Corey and thanks for taking the question. I just wanted to dig in a little bit on that 20% decline in U.S. prescriptions. Is that more of a function of not being able to expand a prescriber base, or is it kind of just doctors who have already prescribed and not re-prescribe new patients?

Good morning, Morgan, this is Bill, and thank you very much for your question. We know that transforming the standard of care with a noble therapy is challenging. We've known that from day one and we've seen consistently that our growth has been more of a stair-step than a continuous upward line. This is also typical in other technologies, so of course we would like to see quarter-over-quarter growth every quarter, but that's not likely to be the case. With respect to the specific barriers that you address, I'm not sure that it's either or. We spend a tremendous amount of effort this quarter in training new centers in the community. As we transition from recurrent GBM to newly diagnosed GBM based on our superiority data, we are expanding our coverage to the community where approximately 60% of the newly diagnosed patients are treated. During this quarter, a tremendous amount of our effort was focused on training in that particular arena. Asaf mentioned also that in the academic setting, there are a number of high profile clinical trials that are competing with us in that setting. Our goal remains to transform the standard of care. We are confident that we have both the data and that we're building the tools required to do that. Asaf also mentioned that just recently we received two very important achievements that we think will be catalytic, the approval of the new Gen 2 device which aims to make treatment much easier for patients and provide prescribers with even more confidence to prescribe the therapy, and of course the NCCN guidelines inclusion at the 2A level which represents uniform consensus of the Optune Therapy. We believe that that is particularly important in the community. So again we would love to see, step-wise, we would love to see continuous growth in prescriptions, we expect it to be step-wise and we believe with our data and with the tools that we're providing we will transform the standard of care.

Okay. And then so you also mentioned some of the, in expanding that prescriber base that some of the doctors wanted to see more clinical data from that standpoint. Is this something that you're going to have to generate more clinical data on the GBM side or do you think that the full 695 patient data set from EF-14 will be enough or subsequent development other tumor types will be enough?

Whenever a new technology is brought to the medical community there are groups of doctors that remain skeptical, it's sort of the nature of the beast. I've introduced a lot of new technologies into a widespread medical practice and in every single case, there's sort of a range of response with a core of skeptics that always seemed to exist. In our particular case, a group of academic doctors have been requesting and is very interested in seeing the full data set. You recall that our newly diagnosed indication was based on exceptionally strong interim data. The data was statistically powerful and resulted in the data monitoring committees request that the trial be stopped for ethical reasons. That was a request of the FDA, validated and agreed with, and of course we received our FDA approval on an expedited basis based on that data set. But there is interest in the community in seeing the full 695 patient data set. And as was mentioned, those data will be available for the community before the end of the year. I also think that continued success and other indications will only help. I think the strong data in pancreatic cancer that we showed at ASCO GI earlier this year certainly helped to build confidence, and I would expect as we continue to unveil or roll out additional data in pancreatic cancer, in ovarian cancer, toward the end of this year that that will certainly be very helpful as well.

Okay, great, thank you.

Mark, your line is open.

I'm sorry, is it question for Mark [ph].

Yes, sir.

So it's Blot [ph] on behalf of Mark. Thank you for taking my question. I'm wondering if previously you gave slight a more color in terms of current penetration in the first line of GBM patients population, and I wanted you to kind of update at this point for the current penetrations in the first line GBM, as well as the current estimate of the duration of therapy, how long patients generally tends to stay on therapy.

Sure, Vlad, good morning. I'll take the question and if we need additional detail I'll ask Asaf. But I think what you're asking is the percentage of the patients in the quarter that were newly diagnosis opposed to recurrent.

No, actually if you have eligible patient population, how many patients are in -- will be eligible to get GBM? How many of them are getting GBM at this point?

Okay. So as Wilco mentioned, we don't break out our penetration by recurrent versus newly diagnosed. We believe that in the quarter approximately 18% of the eligible GBM patients received Optune Therapy.

Okay, thank you, and any updates on the duration of therapy that you're seeing among patients? Is it consistent with clinical trials or it's too early to say?

Yes, so with respect to the recurrent patients that remains the same. Approximately four to five months duration of therapy. With respect to the newly diagnosed, again, we received the approval in October of last year, so we don't yet have enough commercial evidence to provide a specific figure. But everything that we see suggest that at a minimum it's consistent with the clinical trial of duration of nine to ten months.

Okay, and the final question will be about -- between growth in patient numbers and growth revenues. So as you guys mentioned there is delay about four to five months or almost two quarters between growth in patient numbers and in growth in revenue, and I'm wondering if this is really a structural problem that we, not a problem, the structural feature of the business and whether we have to expect this to continue or at some point we will see this get shrink and revenue growth will be in line with regards to patient numbers, as well as whether this can shrink due to the recent update of the entity and guidelines and potential via the approval and lowering barriers for payers and insurers.

Wilco, why don't you take this question?

I hope everybody can hear me. I think we have problems on the line, I think.

I just want to say hi and congratulations on the quarter. Also apologize for Vlad's extra-long question.

Good morning.

Good morning.

No problem. We love Vlad's questions.

Thanks for moving the call to morning.

Wilco, take it away.

All right, guys, so in terms of time to collect, as we mentioned in the script and it's been consistently the case in the last few quarters that the time to collect is approximately four to five months, that's a two quarter -- we talked about in the past. It's driven by, as you know accounting racks where we continue to recognize revenue on a cash basis. A few things that was mentioning such as the NCCN update to 2A. In our earlier remarks we mentioned a lot of work we're putting into developing, making progress in contracting discussions, all those things we believe will help us to be able to secure a situation where the predictability of our revenue and collection is in line with the narrow bandwidth that were allowed and that would enable us to switch to accrual based revenue recognition. And again that disparity if you want between a revenue line and operating expenses line where the revenue was essentially or represents our activities over a couple of quarters ago and the -- in operating expenses represent our actual activities in the reported quarter that would go away. So we're making good progress there. It's hard to tell if and when exactly that will materialize, but I think we're getting closer to being able to record at least a part of our revenue on an accrual basis.

Okay, thank you.

Our next question comes from the line of Lays Blake [ph] of Wells Fargo. Your line is open.

Thank you, good morning. Thanks for the question. Just on this accrual accounting, shift to accrual accounting. Can you give a sense of when you expect that to happen? Do you think some of those account could convert over later this year? Is it more likely to start in 2017?

Wilco?

Good morning. Thanks for the question. As I said, I think it depends on the number of things that have to happen, and contracting will be an important step to take, and I'd like to think that that happens fast so that we can make the switch. But we're in discussion, so we would expect those discussions to be completed with a few of the payers constructively, but the timing is something that's very hard to predict within a month or a quarter. So we're making good progress as we explain after the question, I think to update is to helping. We also mentioned in our prepared remarks that our collection remains above 14%, so overall the acceptance in the payer community of our therapy remains strong, expect contracting to be concluded for a proportion of our insured lives within the next period, whatever that period is. But again we're making good progress. I can't say whether it's next week, or next month, or next quarter, or in the beginning of next year, but we're hopeful that it will be relatively soon.

Okay, and then just on, so now that you have the NCCN update, upgrade to 2A from 2B. Two questions on that. One, do you think this would encourage physicians to include study protocols for GBM going forward? And then, two, in terms of impact from the upgrade -- the guideline upgrade. How quickly do you think we'll see that materialize in your prescription numbers or your patient numbers?

Yes, so I'll take that. So first, let me clarify that it wasn't an upgrade from 2B to 2A. We're in the guidelines for recurrent GBM at 2B, and this was based on the equivalence data of our EF-11 trial, the first trial that we did in extremely sick recurrent patients. And the 2A inclusion is a new inclusion for newly diagnosed GBM that was based on the publication of our superiority data in newly diagnosed GBM. So we have both a 2B for recurrent and a 2A now for newly diagnosed. I think this is undoubtedly helpful. It was one of the key catalyst along with peer review publication, FDA approval and now NCCN guideline inclusion that we discussed during our original IPO materials. So we're delighted to have this. Again, as Wilco said, we're not predicting precise impacts and timing because that's always very difficult, but we really have no doubt that this is going to be very helpful, particularly in the community as we expand to include those prescribers both medical oncologists and radiation oncologists who see the vast majority of the newly diagnosed patients. With respect to the second part of your question. Inclusion of Optune in study protocols. This is something that we feel very passionately about. We think every patient in every trial protocol, particularly patients who are agreeing to be randomized should have the opportunity for the best standard of care when they volunteer for a trial. So this is also something that we're working very hard to make happen in the community, and the NCCN guideline inclusion will no doubt be very helpful with that effort as well.

Thanks, and just last question on the clinical trial, the meta-trial that you just launched. One, can you confirm that you're using, I assume you're using the second gen device on that trial? And then two, did you give an estimate of how long you think it will take to fully recruit a patient?

Yes, I'm going to, we haven't heard from Eilon this morning, so let me turn this question over to our Head of R&D, Eilon Kirson.

Thanks, Bill. So first of all, we are not yet using the generation two device in the meta-trial. The technology is frequency-specific [ph], the gen two device works for the 200 kHz frequency which is specific for GBM. We have not yet developed the gen two device. It's not a very big development and we will perform it as the result of the trial commence. The trial itself is expected to accrue patients over about two years, so we're expecting end of enrolment towards middle of end of 2018.

Okay, thank you very much.

Our next question comes from the line of David Nierengarten of Wedbush Securities. Your lines is open.

Hi, this is Delit [ph] sitting in for David. Thanks for taking my questions. I was wondering if you could discuss the duration of treatment and prescription fill rate in international markets and how that compares to use in the U.S.

Sure, maybe, Asaf, you can comment on the international experience to date.

So in Europe as we reported, we show a tremendous growth and we, especially in Germany. We start active dialogue with the big payers in Germany and our collection there under coverage is improving every month, and you can see and realized that from the numbers. So we feel very good about Europe. In Germany and Switzerland mainly. Regarding duration of treatment, right now we don't have enough data but we feel comfortable with, there's no news about changing duration of these. And from our experience in recurrent GBM, the duration of therapy was even better than expected.

I guess it's fair to say there's more of proportion who are newly diagnosed I guess outside the U.S. and I guess the U.S. figure.

The answer is no.

Okay.

So basically, yes, the answer is basically no. Do you have anything to add Wilco?

I think it's too early to say what the ultimate distribution is newly diagnosed RGBM in the European markets versus what it is in the U.S. market. And even the U.S. market is influx because we launched RGBM in 2012, newly diagnosed in late last year. So these things are developing overtime. So I think it's too early to call. I think we mentioned that we're north of 50% newly diagnosed overall treatment and I think we should assume that's consistent of the geography.

Okay, and I think you mentioned that the average reimbursement was over 14,000 for patients in the U.S. What's the corresponding figure you're seeing outside the U.S.?

That's too early to tell. We are developing a market in Europe, so there are few steps that we take making sure that we have communication on the clinical benefits into the medical community, that recertify patients that were actively engaged in securing reimbursement, and those are the critical steps that we want to make we execute on before we start active marketing promotion. In Germany we see substantial growth, we have constructive discussion with the payer base. We do this on individual basis, but it's too early to provide you with consistent data that you could model the way you would like it to model unfortunately. It's the thing influx.

All right, in that case and some U.S. centric question. When can we expect that you'll begin marketing the new, I guess, NCCN guidelines and how should we expect the salesforce expand in the near term?

Asaf, do you want to take that one?

Okay, sure, thank you. So NCCN is, we basically we received it a couple of days ago. I will go at least to increase our salesforce and right now we have 41 people on the ground, and we're going to basically push it to around 60. So we are actively increasing our salesforce as we speak. I just would like to -- I just would like to mention that it takes probably six months to recruit and train additional team. But we really feel comfortable with the new NCCN guidelines and the fact that we are moving to. We think it will be very influential on the prescriber, especially from the community.

Okay, and then I guess final question is what percent of the patients on treatment in the quarter would you say were part of the Medicare eligible population?

Yes, I think as Wilco mentioned, this is has been very consistent between 20% and 25%, and this quarter was no different.

Okay, thank you for taking my questions.

Our next question comes from the line of Gregg Gilbert of Deutsche Bank. Your line is open.

Thank you guys. I have a few. My first one is a direct question about just your confidence in your peak penetration assumption through GBM and the speed with which you can achieve that peak penetration. Any updated thoughts on that?

Yes, Gregg, this is Bill. I'll take the question. So first of all we've never predicted the rate because that's something that is impossible for anyone to predict. With respect of the confidence I think that if anything, it's higher today than it's ever been. We're the people who see the therapy on the ground, and just to give you an anecdote. We've been converting the existing patients to the gen two device. We received FDA approval on July 13 and as of this morning I think we've already completed over 100 conversions. But one of those early conversions happen to be the very first patient that received Optune Therapy in the U.S. was a recurrent GBM patient, refractory to chemo, who's approaching his tenth year now, something that is inconceivable with recurrent GBM and we went out to his home and we presented them with the new device, and there was tears and hugs. And this is the experience of all us see day in and day out. What we're focused on is building the tools to get there. Those tools started with the data which remains the best, strongest data in GBM, period. Secondly, FDA approval received on an expedited basis with an exceptionally broad and in compelling label. Third, publication in a peer review journal. We're published in JAMA with a wonderful article and a wonderful conclusion stating that we have superior overall and progression free survival and two years survival based on the interim data set. Next on our list was NCCN guideline inclusion. Just received a day or two ago. And then finally, we're doing everything we can to make this therapy manageable by patients, and that provides the confidence for the community that has never seen a therapy like this before. And we know that this is one of our barriers that this is a community that's used to prescribing drugs and not used to managing therapies. We make it very easy for these docs because they just need to prescribe, they don't need to train or manage that therapy. But as it's smaller and easier and simpler, that provides them with confidence. So where we these steps, next step or next tool will be the full data set which will be, again, available later this year. But, Gregg, our confidence is high.

Asaf mentioned some skepticism among prescribers, and I'm curious, hopefully you're dialoguing with the skeptics. Are they most focused on the EF-14 final results and making sure the interim wasn't a fluke or whether they remain skeptical based on lack of placebo control, how post set-up the importance of EF-14 final data? And are we going to get that or will we get that only at the analyst day?

Yes, so let me, I'll take your last question first which is we haven't announced exactly, it will certainly be available at the analyst day. We haven't announced exactly when it will be presented at the conference, but one plus one equals two. So that will again be available certainly by the end of the year. Every skeptic has a slightly different reason for being skeptical. And as I mentioned in one of the answers to the questions, I've launched a number of new technologies that are now widespread standard of care and this is something that always happens. When we launched and we're bringing laparoscopic surgery to the market in the late 80's, early 90's, there were a corps of surgeon that said no, the gallbladder has to be taken out through open surgery, we need a week hospital stay. And today you couldn't imagine that. The longest, it's an overnight procedure. So this is what's required with a new technology. That said, we do hear quite often that the full data set is important. So our hope is that is yet another tool that will help us in getting this therapy to the patients who really need it.

Okay, my last two-part question here is for the ovarian and pancreatic readouts. Are you going to press release the topline when you get them or will we wait for the R&D Day for those? And any update on Medicare discussion?

Yes, so we haven't decided yet, Gregg. Out typical history has been to press release the topline results. We expect it right about the same time as the R&D Day. So if you look at the six months follow up, they're going to be very close to one another. So exactly when it will happen, but I would not expect that significantly prior to the R&D Day in any case. And with respect to the discussions with CMS regarding the Medicare fee for service patients. Those continue at a very high level. There's quite a bit of momentum we feel on our side with respect to those discussions. Things like the peer review publication that was received in December and the NCCN inclusion a couple of days ago are very important in those discussions. That said there's not a clock at CMS and so it's difficult to predict timing here. I will say that there is a tremendous amount of support also on Capitol Hill with respect to this therapy. There's widespread acknowledgement that this is a terrible disease that Medicare beneficiaries should receive the best care possible, and so we appreciate that support, that we continue to provide the therapy to those patients. We continue to build CMS. We are one of the many companies and service providers that are stuck in the back blog ALJ queue, but we expect those claims to be resolved ultimately as well.

Thanks.

[Operator Instructions] One moment. And I'm showing no further questions in the queue. I would like to turn the call back to Mr. Bill Doyle for closing comments.

So my only closing comment is thank you. We are fully dedicated to our dual mission of bringing TTFields therapy to GBM patients worldwide as well as expanding into other solid tumors where we believe we can provide significant benefit. And we really appreciate your interest in our activities. Have a great day everybody.

Ladies and gentlemen, thank you for participating in today's conference. This does conclude the call and you may all disconnect. Everyone have a wonderful day.