NovoCure Limited (NVCR) Q3 2023 Earnings Report, Transcript and Summary

Welcome to the NovoCure Q3 2023 Earnings Conference Call. [Operator Instructions] Please be advised that today’s conference is being recorded. I would now like to hand the conference over to your speaker today, Ingrid Goldberg. Please go ahead.

Good morning and thank you for joining us to review NovoCure’s third quarter 2023 performance. I am on the phone this morning with our Executive Chairman, Bill Doyle; our CEO, Asaf Danziger; and our CFO, Ashley Cordova. Other members of our executive leadership team are also on the call and available for Q&A. For your reference, slides accompanying this earnings release can be found on our website, www.novocure.com on our Investor Relations page under Quarterly Reports. Before we start, I would 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 of which are beyond our control and are 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. Where appropriate, we will refer to non-GAAP financial measures to evaluate our business, specifically adjusted EBITDA, a measure of earnings for interest, taxes, depreciation, amortization and share-based compensation. We believe adjusted EBITDA is an important metric as it removes the impact of earnings attributable to our capital structure, tax rate and non-cash items and thus reflects the financial value generated by our business. Reconciliations of non-GAAP to GAAP financial measures are included in our press release, earnings slides and in our Form 8-K filed with the SEC today. These materials can also be accessed in the Investor Relations page of our website. Following our prepared remarks today, we will open the line for your questions. I will now turn the call over to our Executive Chairman, Bill Doyle.

Thank you, Ingrid and good morning. At NovoCure, our mission is to extend survival in some of the most aggressive forms of cancer through the development of our novel therapy, Tumor Treating Fields. This quarter, we made progress on numerous fronts in pursuit of our mission. Before we review the quarter, I would like to address the evolving situation in Israel. NovoCure was founded in Israel. And as we have grown, our Israeli DNA has remained an important part of our culture and identity. We have 260 colleagues in Israel and hundreds of current and former patients who are affected by the terrorism of October 7 and its horrific aftermath. We are living with grief, shock, fear, anger and sorrow. We will do everything in our power to buttress members of the NovoCure family. Our thoughts and prayers are with everyone affected by these devastating events. Shifting back to our quarterly results. Q3 was a period of continued execution at NovoCure. We finished the period with 3,639 global active patients on therapy and significantly added to the body of clinical data supporting the use of TTFields therapy across multiple cancer indications. We also made meaningful progress on our pipeline, including our next series of clinical trials and product development enhancements. This morning, we will begin with an update of our lung cancer program. We will then discuss our other clinical programs and our commercial business. We will close with a review of third quarter financials. In Q3, we continued to strengthen the foundation of clinical data supporting the use of TTFields therapy especially in our thoracic program. In August, the results of the Phase 3 LUNAR clinical trial in metastatic non-small cell lung cancer were published in the journal, Lancet Oncology. As a reminder, the LUNAR data showed a statistically significant and clinically meaningful extension in overall survival for patients treated with TTFields therapy and the standard of care, exhibiting 13.2 months median overall survival compared to 9.9 months for patients treated with standard of care alone. The results were more pronounced in patients who received TTFields therapy and an immune checkpoint inhibitor, demonstrating 18.5 months median overall survival compared to 10.8 months in patients treated with an immune checkpoint inhibitor alone. Lancet Oncology is one of the premier clinical oncology research journals. We are proud to have the LUNAR data published in this prestigious and impactful platform. In addition to the Lancet publication, several key post-hoc analyses of LUNAR were presented at major medical congresses during the third quarter, further illustrating the broad and growing interest in the LUNAR clinical trial. Key among these was an analysis of survival patterns for LUNAR patients with known tumor progression scores presented at the IASLC World Conference on Lung Cancer in September. This analysis showed that patients treated with TTFields and an ICI with TPS scores greater than 1% exhibited a substantially longer median overall survival compared to those patients treated with an immune checkpoint inhibitor alone, 23.6 months compared to 10.5 months. Further, in patients with low TPS scores between 1% and 49%, median overall survival reached 19 months in the TTFields plus ICI arm versus 9.7 months for treated with an ICI alone. While sample sizes are small, these data support the potential of TTFields to materially extend survival in a large subpopulation of non-small cell lung cancer patients who may not be prime candidates for immune checkpoint inhibitor monotherapy and who could benefit from the addition of TTFields therapy to their pharmacological therapies. The robust extension of survival demonstrated in LUNAR is key to our ongoing efforts to further explore the capabilities of TTFields and immune checkpoint inhibitors for the treatment of non-small cell lung cancer. In October, at the European Society of Medical Oncology Conference, we presented health-related quality of life data from the LUNAR trial. Consistent with all our previously conducted trials, the use of TTFields in the LUNAR study did not result in an increase in systemic toxicity and did not impact the health-related quality of life of patients in the study. Also in October, at the American Society for Radiation Oncology Annual Meeting, we presented a simulation showing the ability to treat cancerous lung tissue with TTFields regardless of a patient’s body mass index. These analyses underscore the applicability of TTFields to treating metastatic non-small cell lung cancer and the growing interest in the LUNAR dataset within the oncology community. On the regulatory front, our teams are on track to submit the final module of our PMA application to the FDA later this year. This comes on the heels of our completed European CE Mark application last quarter. The LUNAR trial is an important milestone as it is our first randomized clinical trial demonstrating extended survival in the treatment of cancers of the torso. We are now advancing our plans for our next lung cancer clinical trials. These next LUNAR trials will explore the use of TTFields together with immunotherapies, which showed immense promise in our first LUNAR trial. Success in these trials will allow us to expand the lung cancer patient populations indicated for TTFields therapy. Beyond our thoracic program, we have two randomized Phase 3 clinical trials nearing major milestones. Top line data from the METIS trial is expected late in Q1 2024. METIS is evaluating the use of TTFields therapy to treat brain metastases for non-small cell lung cancer following stereotactic radiosurgery. And in the second half of 2024, we expect top line data from the PANOVA-3 trial. PANOVA-3 is evaluating the use of TTFields therapy together with nab-paclitaxel and gemcitabine for the first-line treatment of locally advanced pancreatic cancer. In Q3, we also made progress in our PANOVA-4 study, which is exploring the use of TTFields therapy together with atezolizumab for the treatment of metastatic pancreatic cancer. PANOVA-4 enrolled its first patient and is now open and actively recruiting patients. Finally, in the third quarter, we announced the top line results from the INNOVATE-3 trial in platinum-resistant ovarian cancer. INNOVATE-3 did not meet its primary endpoint. Platinum-resistant ovarian cancer is a difficult-to-treat condition. And while we are disappointed with the top line results of INNOVATE-3, we have gained key learnings for the design of future trials. Most notably, we saw a promising survival trend in patients who entered the trial after failing a single previous line of platinum therapy compared to those enrolled after failing multiple lines of therapy. The benefit observed for women who enrolled in INNOVATE-3 earlier in their cancer therapy journey reinforces our understanding that TTFields therapy is that it’s most effective when used early on and informs our plans for future trials. I’d like to close today by reiterating my enthusiasm for the milestones we have reached this year and for those to come in the near future. With two Phase 3 trial readouts and our launch in non-small cell lung cancer on the docket for 2024, the future is bright for NovoCure and we look forward to the opportunity to treat many more patients suffering from difficult-to-treat cancers in the coming years. I will now turn to Asaf to discuss our GBM business.

Thank you, Bill. Our GBM business is the core driver of our financial strength, generating $0.5 billion in revenue and free cash flow that are invested in the TTFields platform. We ended the third quarter with a record 3,639 active patients on therapy. We have had a very successful Optune launch in France and have more than 150 French patients on therapy. We have learned many lessons through our French launch. We built our team in the country over the prior 2 years and focused on building awareness of TTFields therapy among French healthcare leaders. Early investment planted the seeds for an efficient and effective therapy rollout and we believe the French launch playbook will serve as a blueprint for future loan success. In the U.S., we continue to see new activities and dialogues emerge following our commercial reorganization. Teams have improved cross-functional alignment and are synchronized in addressing the key levers contributing to our growth, including patient starts, patient therapy duration and patient usage. All of these inputs are critical to long-term growth in active patients and net revenue. Our teams are focused on increasing awareness of the benefits of TTFields among potential patients and prescribing physicians. In Q3, we finalized our direct-to-consumer campaign, I Power My Life and expect to introduce the campaign to the market next year. We believe direct-to-patient messaging will raise awareness of TTFields therapy and strengthen the demand from patients following diagnosis. We expect direct-to-consumer engagement will be instrumental to driving greater demand from patients and caregivers. We are also focused on driving awareness among the broader oncology community for treatment of GBM and cancers of the torso. Physician engagement has been strong during recent congresses, especially during the ASTRO earlier this month. Strengthening the foundation of clinical evidence is key to driving greater penetration in our current markets. In July, Dr. Matthew Ballo published a meta-analysis comparing the outcomes reported in 9 studies of over 1,400 GBM patients, where TTFields therapy was added to TMZ after surgery. Dr. Ballo’s analysis of real-world data confirmed the outcome of our Phase 3 EF-14 trial and confirmed the improved outcomes associated with patients using TTFields therapy over 75% of the time. Real-world analysis of this size reinforced the survival benefit achieved when TTFields therapy is prescribed for GBM and an important tool as we look to reach more patients and physicians. Beyond our efforts to drive demand, we are working to improve ease of use and drive duration of therapy through product development. This month, we launched our next generation arrays in Germany. As a reminder, these arrays leverage new materials and a unique design to improve the patient experience, they are lighter, thinner and more flexible than previous versions, and have the ability to deliver greater intensity to the tumor site without a corresponding increase in hit. We are on track to submit a PMA supplement to the FDA for the new arrays later this year. Additionally, we are pleased to announce the hiring of our new Chief Medical Officer, who will join us in January. While we are restricted from sharing the candidate’s full details at this time, we are very pleased and look forward to adding his expertise and fresh perspectives to our leadership team. Pritesh Shah will also be transitioning from NovoCure, Pritesh plans to stay on at NovoCure for several quarters as an adviser to ensure a smooth transition to the new CMO and the continued success of our teams. I would like to close by addressing the violent events in Israel. It is difficult to describe the emotional impact of the last few weeks. Many of us, including myself, have lost loved ones to this carnage. And now all of us have family members and friends who served in harm’s way sons and daughters, brothers and sisters, mothers and fathers. The atrocities of war are horrible, it makes me said that this is our reality today. I hope and pray that the conflict will be resolved swiftly. I will now turn to Ashley to close today’s call.

Thank you, Asaf. The third quarter was a period of consistent execution across multiple verticals. With several clinical readouts, regulatory filings and commercial launches on the horizon, we are investing in the essential infrastructure to ensure we are prepared to fully leverage growth opportunities in the coming years. We generated $127 million in net revenues in the third quarter and ended September with 3,639 active patients on therapy, an increase of 6% from the same period last year. Our successful launch in France continues to be a tailwind as we had a second straight quarter of strong prescription flow and patient starts. The pre-commercial engagement and subsequent commercial execution in France have provided a blueprint, which we will leverage in future country launches. We collected $4 million in revenue from France this quarter. But as a reminder, it will take several quarters for the collection cycle to reach full reimbursement levels, and France will impact the net revenue per active patient in EMEA during this time. In the U.S., we continue to experience a year-over-year headwind due to the absence of collections from denied or appealed claims. Last year, we collected $15 million from these claims in the third quarter, which have largely been exhausted at this point. Moving forward, we expect our U.S. business to more closely track the key drivers of net revenue, active patient starts, duration of therapy and net revenue per active patients per month. In Germany, our recovery following defined coverage negotiations continued this quarter. We ended the third quarter with 492 active patients on therapy, a 5% increase from Q3 of last year. This quarter, we saw a decrease in prescriptions as our German team focuses on driving higher quality, more readily-reimbursable prescriptions and increasing pull-through of patient starts and long-term active patient growth. Gross margin for the third quarter was 75%. Over the course of the year, we have invested in expanded patient support capacity in anticipation of treating larger patient populations from new indications and geographic region. As we have shared, product development enhancements, such as our new arrays will impact our gross margin in the near-term. This impact will be felt more acutely in the coming quarters as we roll out the new arrays in our largest market, beginning with Germany this quarter. We are focused on pursuing opportunities to increase efficiencies and scale within our supply chain and will take the steps needed to balance the impact of these product enhancements, while maintaining a healthy margin. SG&A expenses were $100 million this quarter. We continue to invest tactically to ensure we are quick to capture growth opportunities in the future. This includes investing in commercial capabilities to increase penetration in GBM, pre-commercial activities in non-small cell lung cancer and market access capabilities to reach new patient population. In addition, we have increased spending in IT and supply chain capacity. Research, development and clinical trial costs for the quarter were $54 million. With the conclusion of the LUNAR and INNOVATE-3 trials, our R&D investment is shifting to our next wave of Phase 3 clinical trials. This includes the LUNAR-2 trial, where we are preparing to engage sites and enroll patients in the coming months. We look forward to updating you on the progress of this and other clinical trials in the coming quarters. Cash and short-term investments totaled $921 million as of September 30, 2023. Our net loss for the third quarter was $49 million or $0.46 per share, and adjusted EBITDA was a negative $29 million. We are in a window of investment in preparation, with new commercial launches on the horizon and the potential of treating much larger patient population. With these growth opportunities approaching, we are committed to investing tactically to align our near-term capital allocation priorities with our long-term strategic vision. Our goal is to balance the capacity investments needed to treat more patients, while preserving our financial strength and ensuring our ability to invest in value-additive opportunities in the future. I’d like to close today by sharing a story about one of our Optune users, Jovan Knutson. As you may recall, we highlighted Jovan last October. Jovan was diagnosed with GBM in 2021 and began using Optune soon thereafter. As an avid cyclist, she often bikes to her routine visits at the Mayo Clinic, over 100 miles each way. This summer, Jovan set out to tackle an even greater feet, an 850-mile tour of the Upper Midwest. The logistics associated with the tour of this great length can be daunting, with daily checkpoints to reach and supplies to replenish. Jovan worked with our Encompass team to ensure all Optune supplies would be ready and waiting throughout her journey so she could continue her Optune treatment while cycling. Jovan completed her 850-mile tour in August, and we are thankful for the opportunity to support her amazing feat. Our mission to extend survival in some of the most aggressive forms of cancer is rooted in patients like Jovan. To give the gift of time for patients to be with their loved ones, pursue dreams, and achieve amazing feat by Jovan, I’d like to personally congratulate Jovan and thank her for letting us share her story. With that, I’ll hand it back to the operator for questions.

Thank you. [Operator Instructions] Our first question comes from Jonathan Chang of Leerink Partners. Please proceed.

Hi, guys. Thanks for taking my questions. Can you discuss your pancreatic cancer strategy for Tumor Treating Fields? What’s the rationale behind the PANOVA-4 study and the time lines associated with that? And how should we be thinking about the PANOVA-4 study initiating before the PANOVA-3 readout next year? Thank you.

So, good morning, Jonathan, this is Bill. I’ll start and then turn it over to Uri to describe the details of PANOVA-4. But of course, pancreatic cancer is one of the most difficult diagnosis and has proven to be one of the most difficult cancer to treat with many, many failures, of course. Our strategy starts with the fact that we know that we can deliver tumor treating fields to the region of the therapy. Many chemotherapies that depend on the circulatory system can’t even get to the region because of issues with the stromal tissue and differentiation of pressures. So we start there. Further, we start and have built on a very successful Phase 2 trial, where we showed extremely impressive results in a small sample size, for both locally advanced pancreatic cancer and metastatic pancreatic cancer. In our first PANOVA trial, and I’ll remind everyone, this is a trial that we expect to read out toward the end of next year. We focused on locally advanced pancreatic cancer. And this is the stage of the disease where we can completely encompass the – extended the disease with our Tumor Treating Fields therapy. PANOVA also is a first-line trial. So we start at the time of diagnosis in combination with gemcitabine and nab-paclitaxel. And so we remain very optimistic and enthusiastic about the design of this trial. And we’re preparing for success here in terms of rolling out the therapy to this patient population. So that’s the first element of our pancreatic cancer strategy. And now, let me turn it over to Uri – to describe the results or to – pardon me, not results, but to describe the intent to expand the patient population once we anchor in locally advanced.

Good morning. So the background for opening the PANOVA-4 at this time is that we’re doing our best to integrate lessons learned through our clinical program and our scientific program. And learning from the [indiscernible] study in newly diagnosed GBM patients, and from the LUNAR study results where we have seen an outstanding performance of TTFields when concomitantly used with immune checkpoint inhibitors. We feel that we should not hold off on the next step also in pancreatic cancer, even prior to reading the results of the PANOVA-3 study. So PANOVA-4 is for metastatic disease. It will incorporate atezolizumab concomitant with chemotherapy and TTFields and anti-PDL-1 and will be done in collaboration with Roche for these reasons.

Understood. Thanks for taking my questions.

Thank you. [Operator Instructions] And our next question comes from Jason Bednar of Piper Sandler. Please proceed. Jason, your line is open. [Operator Instructions] And our next question comes from Lei Huang of Wells Fargo.

It’s Lei calling in for Larry. Thanks for taking my question. Can you hear me, okay?

We can. Thanks, Lei.

Thanks. Just – I have a few questions, starting on the lung side. Is there any update on the KEYNOTE-B36 trial on clinicaltrials.gov, there is a completion date for mid-2024. Can you comment on that?

Yes. Lei this is Pritesh. Thank you for that question. We’re very excited to have the trial open, B-36 study is a study that’s a Phase 2 pilot study that’s exploring the use of Tumor Treating Fields in the first-line non-small cell lung cancer with KEYTRUDA. So it’s an important study that will help us understand the benefits of moving Tumor Treating Fields plus an IO up in the first-line setting. So the trial is open and enrolling. One of the aspects of lung cancer that we already know, that it’s a very competitive space from a trial perspective, because of the high unmet need. There are lots of agents and there are lots of trials that are open in this space. So, to get rapid enrollment for a Phase 2 study like this can be a challenge. Our teams are focused on ensuring that we do all the education and the support work to make sure that this study continues to enroll because it will be important to help us understand, again, the role of Tumor Treating Fields in the first-line setting.

Okay. Is there an update on the timeline? Is that mid-2024 date on clinicaltrials.gov, is that accurate?

So, like with all studies because they are on a pace of enrollment, I would say that’s just an anchor point. As the study enrollment sort of gets closer to an end date, we will continue to provide updates on that front.

Okay. Got it. And related to that, is there any way to bridge KEYNOTE B36 to your new LUNAR trials in first line to help expedite patient enrollment and the timeline of development?

Yes. So, that’s an interesting question. I think that any time we can speed up enrollment. It’s really wonderful to take advantage of those opportunities. There are two different protocols at the moment, the B36 protocol was ahead of the LUNAR-2 study, which is now going to be in an operational setting, so we can start getting enrollment in LUNAR-2. So, this study is meant to give us a quicker read of the similar patient population, albeit they are two different protocols. So, we will look at it as the study enrolls and see if there are any advantages to accelerate our LUNAR-2 efforts.

Okay. Thanks. And then just a few questions on the Q3 results. On the call, I think you actually talked about reps focusing on high-quality prescriptions in Germany. Can you just expand on that? And how do we think about the impact on the prescription volume going forward? And rest of world prescription volume was really strong, patient volume as well. Was that just France to launch, or were there other aspects of it?

Yes. Lei, this is Ashley. Thanks for the question. So, it is patients that we would have you focus on in Germany. So, you can see that active patients were up 5% year-over-year. What that really does reflect is, now the new coverage criteria is fully understood both on our side, but also on the physician side. And so over the course of 2023, what we have seen is that physicians have stopped writing scripts for patients that will not get reimbursed. Those were not scripts that were filled last year nor were they scripts for which we are getting paid. So, that’s kind of a natural and positive maturation that these messages are understood and everybody in market understands now what we will get paid for. So, I would look at active patient growth, that’s the right anchor, and that is really trending well right there in that market. And as you noted, rest of world as well, so I would say we saw a stable business in active patients around the rest of the world and then a really strong performance in France, as we mentioned, with more than 100 patients out there.

Got it. Thanks. And then if I can squeeze in just one more. You have a zero convert that’s due in November 2025. I think you have – the company has the option to redeem at some point this year. But presumably, that’s not going to happen at this point. How do we think about the redemption or the conversion optionality before maturity?

Yes. No, it’s another great question and one that – as you can imagine, we are getting asked a lot recently. What I will say is reiterate what I mentioned in the script that we have an incredibly strong balance sheet. We have a GBM business, which generates $0.5 billion in revenue and throws off about $100 million in free cash flow. We are an R&D organization, so we are committed to investing in these future opportunities and future growth, but we are very astutely looking at how we can both manage our short-term goals and ensure that we have a strong balance sheet to get us through our pipeline investments and to get us through successful product launches, while ensuring that we keep our eyes on kind of the long-term value creation, which we know is in hand. So, what I will say is, rest assured, we are very focused on this and the P&L and free cash flow metrics are something that are in our control and is very much actively being managed, I would say just – to ensure that we maintain our strengths throughout the journey.

Okay. So, no comment on the redemption or conversion optionality at this point.

Correct.

Okay. Thank you.

Thank you. [Operator Instructions] And our next question comes from Emily Bodnar of H.C. Wainwright. Please proceed.

Hi. Good morning. Thanks for taking the questions. Maybe two for me and starting with kind of a follow-up from the first question. I am curious to get your thoughts on PANOVA-3 as it’s also using paclitaxel backbone, which is used in INNOVATE-3 and maybe just discuss the differences and why you are still confident in PANOVA-3 being successful, given that with INNOVATE-3, the paclitaxel combination didn’t really show much survival benefit. And then second question, as you are getting closer to the METIS readout. What are – how are you kind of thinking about the market opportunity there? And any overlap that you think you may have in terms of launch benefits given your GBM commercial capabilities? Thanks.

Sure. So, thank you very much for the question. So, let me comment on the differences between the INNOVATE-3 study and the PANOVA-3 study. As we described in the script and other communications, the patient population that was recruited into the INNOVATE study consisted of women who had failed many prior lines of therapy. And we showed a benefit when women entered the study after failing one prior line of therapy, but we were unable to show a benefit after they had failed three, four and up to five lines of prior therapy. So, these were very sick, very brittle and in fact, these women have failed – I shouldn’t say the women have failed, but Phase 3 studies have failed again and again in this particular population. It’s also a stage of the disease where the cancer has spread beyond the region that we are able to directly treat with the Tumor Treating Fields electric fields. I now contrast that with PANOVA-3, as I have said earlier, this is a study in the first line. So, this is after diagnosis. It’s a study in patients who have locally advanced, meaning that they have not – that the disease has not fully spread throughout the body. So, we can treat the full extent of the disease. So, I would anchor on these two facts when comparing our ability to derive great benefit. And in fact, we saw a greater benefit in the – in our pancreatic Phase 2 compared to the benefit that we saw in our ovarian Phase 2. The benefit that we saw again in our ovarian Phase 2 was, with women who were early in their cancer journey, not at the end of the journey. And then that leads to PANOVA-4 that Uri just described, where we know we can treat systemic disease, is when we combine with an immunotherapy. This is what we saw in LUNAR, where we were treating patients after, with metastatic lung cancer after failing platinum therapy. And we saw really tremendous results when we combined with an immune checkpoint inhibitor. And in that case, you get the benefit of the antimitotic effect of the Tumor Treating Fields alone where we create immunogenic cell death, and then that will turbo-charge the effect of the immune checkpoint inhibitor. So, that was a lot of discussion. But with Tumor Treating Fields plus chemotherapy, we need to treat early in the disease progression in order to get a really maximum benefit for patients. And if we have to wait until later in the disease journey, we want to treat with an immune checkpoint inhibitor.

Thanks. And on the METIS readout?

So, on the METIS market, so again, I think we do have an advantage in that we will be using the same commercial infrastructure. So, the same oncologists who treat glioblastoma, even though it’s a different disease, it’s non-small cell lung cancer that has metastasized to the brain. These are the same clinicians. And so we would expect to leverage the same commercial infrastructure that’s already in place, and that will clearly be a benefit for us when we launch that indication.

Okay. Thank you.

Thank you. [Operator Instructions] And our next question comes from Jason Bednar of Piper Sandler. Please proceed. Jason if your line is muted, please un-mute. [Operator Instructions] And our next question comes from Vijay Kumar of Evercore ISI. Please proceed.

Hi. This is Kevin for Vijay. Noticed that you called out $14.5 million of denied payments, just curious on what this means going forward? Is this a change? Are payers becoming more stringent? Any color there would be helpful. And were there any denied payment trends historically? Thank you.

Kevin, yes, this is Ashley. I appreciate the question because it is really important that everybody understands this one. So, this is not a change. This is not a reflection of any more stringent coverage criteria. And in fact, this is consistent with our messaging here over the prior three quarters, in that we had a significant amount of claims from – I mean of revenue from aged claims in our 2022 baseline number to the tune of over $40 million year-to-date in the first nine months, and as you noted, about $15 million in this quarter. So, that is revenue that was at our year-over-year comparison in the baseline and is not in the actual for 2023. We would not expect it to be moving forward, because we are now in a position where revenue reflects the base drivers of our business, which is our current Optune patient volumes and the net revenue that we are able to collect on those patients. So, to be very clear, this is not more stringent coverage criteria and in fact, is a factor more of an elevated baseline than it is in the 2023 trend.

Thank you. And if I can follow-up, how should we think about the METIS trial as it relates to your GBM business especially given its focus on the same region. Do you see any potential impact or change in physician perspectives on Optune positive or negative from those trial results on your GBM business? Thanks.

Kevin, another important question. Thank you. Simple answer is no. These are two distinct diseases, even though they may be treated by the same clinicians. Our GBM business is now well established and stable, and we have resounding clinical evidence and commercial experience. In the script, in fact, we called out recent reports of real-world evidence and in particular, Ballo’s analysis of nine separate real-world papers, and these are all coming in at exactly the same place supporting the results of our original clinical trial. And we have reached a point in the world where clinicians also have their office experience. They have substantial – the prescribers have substantial numbers of patients. They see the benefits. They see the extension and survivals in their own practices. So, plus or minus, I don’t think there is going to be an effect either way.

Thank you. At this time, I would like to turn the conference back to Bill Doyle for closing remarks.

So, thank you very much. I want to thank everyone for your continued interest and support in NovoCure. The messages I want you to take away from this call are, first and foremost, that we are executing our plan. GBM is a stable business that’s providing the financial support for us to invest in our future. We have made exciting clinical progress, first and foremost, in our thoracic program where we are preparing to launch around the world, and in the future, where we are excited by the imminent prospects of METIS and PANOVA-3 next year. So, it’s an exciting time to be at NovoCure. It’s a busy time. We stand with our Israeli colleagues, and we couldn’t be more appreciative of their hard work during this incredibly difficult time in that country. So, thanks again and we look forward to reporting next quarter.

This concludes today’s conference call. Thank you for participating and you may now disconnect.