PTC Therapeutics, Inc. (PTCT) Q2 2021 Earnings Report, Transcript and Summary

Ladies and gentlemen, thank you for standing by, and welcome to the PTC Second Quarter 2021 Financial Results. At this time, all participants are in a listen only mode. After the speaker’s presentation, there will be a question-and-answer session. [Operator instructions] Please be advised that today's conference is being recorded. [Operator instructions] I would now like to hand the conference over to your speaker for today, Kylie O'Keefe, Senior Vice President, Global Commercial and Corporate Strategy. You may begin.

Good afternoon. And thank you for joining us today to discuss the PTC Therapeutics second quarter 2021 corporate update and financial results. Joining me on today's call is our Chief Executive Officer, Stuart Peltz; our Chief Development Officer, Matthew Klein; our Chief Business Officer, Eric Pauwels; and our Chief Financial Officer, Emily Hill. Before we start, let me remind you that today's call will include forward-looking statements based on current expectations. Please take a moment to review this slide posted on our investor relations website in conjunction with the call, which contains our forward-looking statements. Our actual results could materially differ from these forward-looking statements, as such statement is subject to risks that can materially and adversely affect our business and results of operations. For a detailed description of applicable risks and uncertainties, we encourage you to review the company's most recent quarterly report on Form 10-Q and our annual report on Form 10-K filed with the Securities and Exchange Commission, as well as the company's other SEC filings. We would disclose certain non-GAAP information during this call. Information regarding our use of GAAP to non-GAAP financial measures, and a reconciliation of GAAP to non-GAAP is available in today's earnings release. With that, let me pass the call over to our CEO, Stuart Peltz. Stuart?

Thanks, Kylie. And thanks for joining us today. As we close out the first half of 2021, I'm proud to say that a lot of progress has been made in all facets of our business. And I'll go into this in more detail shortly. However, before I do, I'd like to take a moment to reflect on our strategic plan at PTC and measure how we're doing. At PTC our mission is to provide innovative treatments to patients with debilitating diseases that have fewer no treatment options. The foundation of our strategy is to have a sustained pipeline, so that we may continue to produce commercial treatments that will drive revenue and create value for all stakeholders over both the short-term and long-term. We all know the importance of having a deep pipeline to balancing innate challenges of the drug discovery and development process. We are all working towards building a steady state number of therapeutic programs, so that the successful programs move forward. This approach will allow us to have a sustained pipeline of potential new therapies that reach commercialization and substantially grow our revenue base. So many of us have been fortunate to have access to COVID vaccine, we recognize that the pandemic is still very much a reality in many parts of the world. This brings additional challenges with potential impact across multiple aspects of our business. However, we're continuing to manage through these challenges as they arise. I want to emphasize the impressive revenue growth that we have seen this quarter, which is driven by the strength in our DMD franchise, and the incredible uptake of Evrysdi, based on this impressive growth we will be raising our 2021 DMD franchise revenue guidance to $370 million to $390 million and Emily will go into this in more detail later in the call. So let me start with a DMD franchise. Our commercial team has been working hard to make our therapies accessible to DMD patients around the globe. As a result, Translarna saw an impressive 36% year-over-year growth. I'm very proud, that the growth continues almost seven years post launch, both in existing geographies and with continued geographic expansion. Emflaza is also continuing to deliver strong revenue with an increase of 36% over the same period of last year. Eric will discuss the success of the commercial franchise in more detail shortly. Now let me turn to the splicing platform, starting with an Evrysdi. Evrysdi continues to see a strong uptake in the US with 1,800 SMA patients now on treatment, representing almost 20% market share in less than a year post launch. Evrysdi is also now approved in 53 markets outside of the US, and we are starting to see an early adoption in these markets and expect this growth to continue, as we conclude on additional pricing and reimbursement discussion. As anticipated, Evrysdi was approved in Japan this quarter, and we will receive a $10 million milestone payment from Roche upon the first commercial sale. I also wanted to touch on the recent positive results from the SMA studies, which I find to be quite remarkable. The Rainbowfish study using the Evrysdi increase Presymptomatic infants diagnosed with SMA, demonstrated Evrysdi treated infants achieve the same developmental milestones as healthy children. Enrollment data from the Jewelfish study, which is assessing the diversity Evrysdi in SMA patients previously treated with other therapies, including Zolgensma and Spinraza demonstrated overall stabilization and motor function after switching to Evrysdi. This shows the benefit of Evrysdi in the broader energy as real world as the main population. Turning to PTC518 and a Huntington's disease program, in the second quarter of this year, we were excited to release the preliminary results from our Phase 1 healthy volunteers study. As a reminder, the results from this study demonstrated a dose dependent lowering of Huntington to mRNA, even after only a single dose of PCC518. The results also demonstrated in a target mRNA lowering of 40% to 50%, even in the lowest multiple ascending dose cohort. We are in the process of completing the Phase 1 trial. This includes additional protein sampling of food cohort and a CSF pharmacology cohort. We plan to release the results of these additional cohorts in the third quarter of this year, as well as share details on our next clinical study, which we are planning to initiate before year end. I’ll now turn to our bio-e platform. This is an exciting and novel science platform to identify new therapies that result as a consequence of excess electrons, usually produced from the mitochondria during electron transport. This triggers oxidative stress and causes havoc within the cells that result in and exacerbates multiple disease states. Drugs that can modulate this process would be valuable therapies to treat a wide variety of diseases. We have two important ongoing trials with particular note. Our first compound from our Bio-e platform that is a 15-Lipoxygenase inhibitor, which is the key regulator of this pathway. The first is in mitochondrial epilepsy, and the second is in Friedreich ataxia. These two trials are registration directed, and therefore our potential near-term value drivers. We also have a second generation 15-Lipoxygenase inhibitor, PTC857with pharmacokinetic properties, well suited for a range of adult neurodegenerative diseases. We are pleased to have completed the Phase 1 healthy volunteers study for PTC857. And Matt will share the results later in the call. Turning now to our PKU program, which is another important near-term value driver. We're excited as we plan to initiate the Phase 3 registration directive study affinity in September of this year. PKU is a large orphan indication with an estimated 58,000 patients globally. The vast majority of patients are not well controlled with existing therapies, highlighting the substantial unmet medical need. Study startup activities are well underway. We are utilizing our global infrastructure to focus on sites both in the US and globally. PKU is a unique development and commercial opportunity in the rare disease world, as it has well defined patient population, well know centers of excellence, and an expedited path to commercialization. We look forward to the potential for PTC923 as a clinically differentiated therapy to the PKU community. Moving to our gene therapy platform, and AADC program. As a reminder, the CHMP impose a clock stop to allow for the pre-approval inspection. This process is still ongoing, and we expect to see a CHMP is in the fourth quarter. Turning to the US, and we have previously shared, we were conducting additional surgeries in advance of the BLA submission, we're happy to announce that the third surgery has recently been completed and will now ally with the FDA prior to the BLA submission, which we plan to submit by the end of this year. I want to take this moment to discuss our gene therapy manufacturing facility in Hopewell, New Jersey. We have a 220,000 square foot fully functional, well equipped and validated facility for the development and manufacture of the gene therapy products in our pipeline, thereby minimizing our lives on external CRO. As we have excess capacity, and retain the relevant manufacturing expertise, we have a unique opportunity to potentially create a revenue stream by entering into development and manufacturing service agreements with other companies, utilizing this facility and our expertise to produce high quality plasmid DNA and AAV vectors. Lastly, I wanted to highlight the potential upcoming milestones from our oncology platform. Unesbulin, previously PTC596 is in clinical trials for two niche solid tumors, DIPG and LMS. DIPG is a rare pediatric brain tumor, and LMS is a rare adult solid tumor and muscle. Both have unmet medical need with few beneficial to no treatment options. Results are anticipated in the second half of 2021 for the two clinical trials and with positive results, we have the potential to initiate registration directed trials. We look forward to sharing the results shortly. As you can see, we are continuing to make progress across our commercially clinical efforts. I'm proud of our progress, driven by our people and their strong commitment to our mission to deliver therapies to patients and needs. With that, I'll turn the call over to Matt for an update on development. Matt?

Thanks, Stu. I want to start by emphasizing the continued progress our development teams have made across all our programs. First, I'll start with our splicing platform, and our PTC518 Huntington's disease program. As Stu mentioned, we shared the initial results from our PTC518 Phase 1 healthy volunteer study for the second quarter of this year. As we reported, PTC518 treatment resulted in the desire to dose dependent lowering of HTT mRNA levels in both SAD and MAD cohorts. We are in the process of completing additional cohorts to provide data on HTT protein levels and CSF biodistribution. Results from these cohorts will be released in the third quarter of this year. Given that we have achieved our key objectives for the PTC518 Phase 1 study, planning for the Phase 2 trial is underway, and we expect to initiate the trial by the end of this year. The Phase 2 study will be conducted in HD patients and will focus on demonstrating dose dependent reductions in HTT mRNA and protein levels. We will provide more details on the study design once it is final. Next, I would like to highlight the progress we have made in program for bio-e platform. We have two ongoing registrational directed trials with vatiquinone, our lead compounds in the bio-e platform. And we recently completed the Phase 1 healthy volunteer study of PTC857, the second compound to the platform. But the MIT-E trial, our Phase 2/3 trial in children with inherited mitochondrial disease and epilepsy and MOVE-FA, our Phase 3 trial in Friedrich ataxia are global studies that are actively enrolled. As you noted, these program are near term value drivers. And we remain on schedule to have data readouts with the MIT-E study in Q3 2022 and the MOVE-FA study in 2023. Turning out a PTC857, a 15-lipoxygenase inhibitor being developed for neurodegenerative disease. I am pleased to share that we have completed the Phase 1 healthy volunteer study. And at PTC857 was found to be well tolerated with now reporting serious adverse events. PTC857 also demonstrated predictable pharmacology, and we were able to achieve the desired plasma exposure levels consistent with the levels of which we observe efficacy in our pre clinical studies. We are now positioned to move PTC857 forward to Phase 2. Through its activity at 15-lipoxygenase, PTC857 targets the pathway of oxidative stress and inflammation, known as Ferroptosis, a pathway key to CNS disease pathogenesis in ALS, Parkinson's disease and other neurodegenerative disorders. Our preclinical program has demonstrated our PTC857 provides potent protection against oxidative stress and inflammation base cell injury and death in a series of CNS disease in vitro and in vivo tests. Turning now to our PKU program, we are on schedule to initiate our Phase III registration directly trial, the APHENITY study with PTC923 this course. As a reminder, APHENITY is a double blind placebo controlled study with a 1a Phase to identify subjects who respond to PTC923 treatment. These responders will then be randomized to receive either PTC923 or placebo for six weeks. This approach of enriching the study population with responders increases the probability of success of the trial. Following the efficacy study, all subjects will be eligible to enroll in a long term open label extension study. We plan to have data from the exploratory trial in the fourth quarter of 2022. Turning now to our gene therapy platform, as Stu noted, the third tangle of surgeries in support of the AADC BLA submission has been completed. We plan to align with the FDA on the data package and then to submit the BLA by the end of the year. As a reminder, the surgeries were conducted to gain experience with the intended commercial cannulation delivering our gene therapy product. One of the innovative aspects of our AADC gene therapy program is that the gene therapy product is delivered directly to the putamen, the area of the brain key to disease pathology. In order to achieve this direct delivery into the brain tissue. neurosurgeons use a stereotactic surgical procedure that relies on an MRI based google map that provides a direct path for the surgeon to safely reach the putamen to deliver the gene therapy. Let me now provide a quick update on emvododstat, previously PTC299 currently in a Phase II/III trial for COVID-19, 519. Enrollment is ongoing in this trial and we expect this study to be completed by the end of this year. As reminder emvododstat is also being studied in ongoing trial in patients with acute myeloid leukemia. Finally, I would like to remind you about ongoing placebo controlled trial with Translarna for Duchenne Dystrophy study 041. This global study is a 72 week randomized placebo controlled trial that incorporates many of the key learnings we have made from our previous DMD trial. This study is fully enrolled and we expect to have results in Q3 2022. In summary, we are continuing to move our development program forward with many important milestones in the near future. I will now turn the call over to Eric for an update on our commercial business. Eric?

Thanks, Matt. Once again, I'm extremely proud of the strong execution from our global customer Phase III team and the continued remarkable growth of our global DMD franchise. With our team focused on patients, our team was instrumental in delivering another highly successful quarter for commercial revenue. We've seen incredible progress in our DMD franchise with year over year growth in both Emflaza and Translarna resulting in a 36% growth for the franchise. New patient starts continued high adherence and fewer discontinuations have sustain the growth of Emflaza. In this quarter, we achieved $49 million in revenue which is a 36% increase over the second quarter of 2020. Strong executions supported by new data recently presented by Dr. Craig McDonald at UPPMD, continues to support clinical differentiation over prednisone and it's helping drive new prescriptions from patients. Turning to Translarna, we achieved $53 million in revenue this quarter, a 36% growth over the second quarter of 2020. This sustained performance was driven by growth due to expansion of the patient base, continued high compliance and broader access in existing geographies as well as continued geographic expansion. As an example of geographic expansion, following the approval of Translarna in Russia, we are pleased to announce that we have successfully launched and patients are now receiving treatment. The launch in Russia entity growth in other key markets have been one of the major drivers for revenue growth in the second quarter of 2021. Ongoing geographical expansion in Central and Eastern Europe, Latin America, the Middle East, and Asia Pacific continues to be a focus for us, including expanding our footprint and infrastructure in additional markets such as Japan, Mexico. We are making continued progress with reimbursement for Translarna and we're pleased in extending the managed access agreement in England. In Latin America, we continue to see increases in newly diagnosed DMD patients, and are making good progress towards security group purchase order for Translarna in Brazil in the second half of 2021 to treat both new and existing DMD patients. Now turning to case study and reliever, disease awareness, and patient identification continues to be the focus of Latin America, and our teams have made substantial progress despite the ongoing COVID-19 challenges in the region. In Brazil, our discussion on pricing protect setting continues. During the process, we continue to provide medical education, genetic testing and patient progress to support basic study available in multiple countries in Latin America to early access program to bring this important treatment for HATTR amyloidosis patients. We are pleased that we now have some of the first patients benefiting from the treatment with reliever in Latin America through early access pathways. We are preparing for launch in Brazil. However, due to COVID delays at visa, reliever registration is now anticipated in Q4. As we [ph] announced the establishment of a taskforce to address the backlog of pending applications with a priority for rare disease applications. I will touch on the preparation for PTC’s first gene therapy launch. As a reminder, PTC AADC the transformative gene therapy that has the potential to produce meaningful changes in AADC deficiency patient. Preparations are progressing well and we anticipate launch to occur in Europe shortly after final EMA approval. PTC continues to accelerate patient screening activities with over 100 at home and saliva base genetic testing program in over 20 countries initiated in rich high risk populations. Significant profit progress has been made with the identification and preparation of expert pediatric neurological centers of excellence throughout the US, the EU and Latin America to ensure treatment centre readiness at the time of launch and we remain confident to achieve our goal of 300 patients identified globally by launch. We generated another strong and sustained performance in Q2. And I continue to take great pride in our accomplishments from a global customer facing team and their ability to flawlessly execute against their strategic priorities. With that, I am pleased to announce that PTC is raising our 2021 revenue guidance to $370 million to $390 million. I will now turn the call over to Emily for a financial update. Emily?

Thanks, Eric. In the second quarter of 2021, we continued to see strong commercial performance and demonstrated progress across our pipeline. We remain in a healthy financial position with a robust cash balance and another year-over-year increase in revenue from the DMD franchise. We have been working strategically to advance key platforms and look forward to a number of upcoming milestones from our pipeline. In light of the consistent strong performance of Translarna and Emflaza to date, we are pleased to raise revenue guidance for the DMD franchise for 2021 to $370 million to $390 million from the original 2021 revenue guidance of $355 million to $375 million. The press release issued earlier this afternoon summarizes the details of our second quarter 2021 financial results. I will take a few minutes now to review these financial results. Please refer to the press release for additional details. Beginning with the top line results, revenues were $117 million for the second quarter of 2021, a 55% increase over the second quarter of 2020. This revenue includes $103 million in net product sales and $14 million in royalty revenue from our partner Evrysdi program. Turning now to more detail on the success of the DMD franchise, Translarna net product sales were $53 million compared to $39 million in the second quarter of 2020. A key driver of this growth has been through geographic expansion, particularly in Russia, and the Central and Eastern Europe, Middle East and North Africa region. Emflaza net product revenue for this quarter was $49 million, as compared to $36 million in the second quarter of 2020. Moving on to an update on Evrysdi, our partner Roche has reported year-to-date sales of approximately $243 million Swiss francs, which is approximately €265 million. As a reminder in exchange for €650 million upfront cash added to our balance sheet. PTC also retains approximately 57% of Evrysdi royalty until Royalty Pharma receives a return of $1.3 billion, after which a 100% of the royalties revert back to PTC. As part of this royalty monetization transaction, PTC also retained sales and regulatory based cash milestone. Following the approval of Evrysdi in Japan this quarter, we anticipate of near term $10 million milestone payment upon the first commercial Japanese sale. Non-GAAP R&D expenses were $112 million for the second quarter of 2021, excluding $13.4 million in non-cash stock-based compensation expense, compared to $168 million for the second quarter of 2020, excluding $8.6 million in non-cash stock-based compensation expense. The relative decrease in research and development expenses, primarily related to one-time charges in the second quarter of 2020 of $53.6 million for Censa merger as well as 441.2 million for commercial manufacturing service agreement with MassBiologics. Non-GAAP SG&A expenses were $56.6 million for the second quarter of 2021, excluding $12.3 million in non-cash stock based compensation expense, compared to 45.3 for the second quarter of 2020. Excluding $8.3 million in non-cash stock based compensation expense. Cash, cash equivalents and marketable securities totaled $947.1 million as of June 30, 2021, compared to $1.1 billion as of December 31, 2020. I'll now turn the call over to the Operator for Q&A. Operator?

Thank you. [Operator Instruction] Our first question comes from the line of Eric Joseph with JPMorgan. Your line is open.

Good evening. Thanks for taking the question, nice quarter. Just on the DMD franchise performance. With guidance now raised here, we're looking at the midpoint that actually choose to buy a flat to down trajectory for the second half. So I'm just wondering if you could kind of talk us through any risks that you're anticipating with respect to ongoing performance with either Translarna or Emflaza and wondering whether this second quarter results reflected the advanced purchasing or stocking? Then I have a follow-up.

Yeah. Thanks, Eric for the call. Eric, why don’t you take this.

Sure, Eric. First of all, I think we had a terrific Q2. We had 53 million in sales for Translarna, that’s 36% increase over last year. And with Emflaza, identically 36% growth. We had $49 million of revenue in the quarter. I think when you look at our revised guidance, I think our guidance right now reflects that we're growing in all major markets. We're very proud of the work that the European team has done after seven years, especially northern and southern Europe where they have the largest base of patients and we've been able to maintain that high base, large base of patients with high compliance rates minimizing dropouts. But what we're seeing growth right now is really, a lot of this, the new patients are coming in from Russia, from Central and Eastern Europe, Middle East and in our business in Latin America continues to be to be solid, despite some of the COVID challenges that we have. And we expect, right now, orders in Latin America, and particularly Brazil, significant orders, which you already know, can be somewhat lumpy, we anticipate those to happen in the second half of the year. So I mean, overall, I think we're very confident. We have a strong continued growth of Translarna. On the Emflaza front, we had one of our best quarters ever, and we continue to see new patient grow. We also see that the compliance with Emflaza is extremely high. And more importantly, that this data that's being generated now, new data, real world data and switching data, we're seeing not only new patients, but we're seeing an increased amount of patients that are actually switching from prednisone to Emflaza. And that's really a very important side. So overall, I think our guidance, where we're looking at right now is very strong, continued performance, it would be right now on the upper end would be at least about 17% increase year-over-year. And that's pretty in line with what we think we can achieve. And the business right now has a good tailwind.

Okay, great. And just second question on Envisat. The FITE19 trial is focused on hospitalized patients, but I'm just trying to get a sense of how you're thinking about the market opportunity is used here, assuming success. Do you see potential for its use in the outpatient setting? Do you have the regulatory flexibility to do that? Or do you need to conduct a separate file for a patient? Thanks.

Thanks. Yeah, thanks. Thanks for that question. I'm particularly we're excited about this. Just to remind everybody that PTC299 are a small molecule. And that so certainly can't be used in the outpatient setting, right. So, we think, right now we're doing a hospital trial, but it certainly can be used. I think it has the advantage and that is the dual mechanism and that is that because of its mechanism -- first of all, it's a cellular mechanism, so it won't have the issue. We don't anticipate as much of an issue with the SARS-CoV-2 mutating and it targets the DH cellular enzyme. And second of all, I think by targeting this, we're less likely to elicit drug resistance as a consequence of that. So, we -- so on the whole, we think that that this will certainly have a possibility in the outpatient setting. And we'll have to discuss with the FDA based on the results from the current trial if successful. If and when successful, how can we use it in both in hospital as well as patient settings. So, we're certainly seeing that has the capability to be used in both and it's simple to take. You can get it -- obviously, if you have a prescription, you can take it as soon as you get COVID.

Okay, got it. Appreciate that. Thanks for taking the questions.

Thank you.

Thank you. Our next question comes from the line of Alethia Young with Cantor Fitzgerald. Your line is open.

Hi, congratulations on all the progress. This is Nina on for Alethia and thanks for taking our question. We were wondering for the Huntington's update, if you could just share how much and what information you should get or expect around CSS? Thanks.

Sure. Matt, you want to take that?

Yeah, sure. So, as we said before the Phase 1 study, the key objective of that study was to demonstrate a dose dependent lowering of Huntington mRNA and protein in peripheral blood cells for unique opportunity with an oral molecule that broadly bias distributes to the body into the brain where we have a ratio of lowering its peripheral blood cells and one to one with cells inside the brain. So, what we're able to do is able to look at blood cells peripherally and get a lead on what's going on in the brain. And that's really a function of one the biodistribution molecule, and two, the fact that it is an oral molecule that's been designed eflux from the CNS and really penetrate all regions of the brain equally, which obviously is incredibly important as Huntington which is a total brain disease. And so that's what we were able to show so far with the -- right out of that dose lowering of mRNA in the peripheral blood cells in both the SAD and MAD cohorts. And the CSF cohort we refer to is a pharmacology cohort. What we're going to look at in the CSF in healthy volunteers, is making sure we get the biodistribution to the CNS that we anticipate based on all the work we've done before. One key element of the design of this molecule was to ensure not only is cross the blood-brain barrier, that it doesn't get the influence, that means if it cross the blood-brain barrier, it stays in. And that's incredibly important for this biodistribution throughout all regions of the brain. Well, the way we can tell whether or not that's happening is by measuring drug levels in the CNS -- in the CSF, specifically, and comparing those levels to the peripheral plasma levels. So, that's exactly the readout that we'll be getting from the CSF cohort, lining up the levels of drug in the plasma with levels of drug in CSF and being able to check that box that we're getting the desired end designed CSF -- CNS penetration. So specifically, the beginning a readout of drug levels in the CSF, and being able to check that key box that we're getting the -- the biodistribution lots of these flux that we've seen in preclinical studies in the animal models, and we're key design feature of the molecule.

Okay. Thank you.

Thank you. Our next question comes from the line of Tazeen Ahmad with Bank of America. Your line is open

Hi, good afternoon. Thanks so much for taking my questions. Guys. I just have a couple, one on AADC. This is a program, where I think you guys have been engaged in patient finding efforts for a while. It's been a quarter since we've gotten an update on how many patients you found. I think the last count was somewhere in the 200. I was curious, if you have any updated numbers on the addressable patient population that you could identify today. And then I have one follow-up.

Okay, yeah, thanks for the question. Eric, you want to take it?

Yes, Tazneen, right now, we're still doing a lot of work. As I mentioned earlier, you know, our plans are really continuing to aggressively look at and pursuing patient finding. We're not at this point in time, we're not going to be prepared to reply numbers of patients. But we're well on track right now, to achieving our goal, which is to have 300 addressable patients, between now and the time when we have our first launch, and we're anticipating our launch -- the first country launch to be in Germany, and that would be following EMEA approval, and at that time, would be providing the number of patients. But you have to be really, really, you have to understand that this is an ultra rare disease. And what we've done is, we've really cast the net pretty widely now. So we have 100 programs right now, where we have been screening patients in very high risk populations, particularly like in the cerebral palsy, epilepsy center. And we've tested our MS geographically to over 20 countries. And those 20 countries really represents areas, where we can get access and reimbursement. But keep in mind, when we announced the number of patients at the time of launch, that will be the number of patients globally. And then of course, that will be sequenced according to market access, and reimbursement amongst various countries in Europe in early access program across the globe. So really focusing on that we're focusing on not only just patient binding, but making sure that our centers are ready. And we have centers right now that have, as Matt said, who have treated patients in the US, in Europe, and Asia, and we're really expanding the -- if you will, the pediatric neurological centers of excellence. So make sure that when we have these patients, they'll be able to be treated as quickly as possible.

Okay. And in terms of your total addressable population that you think exists, I think your last guidance was somewhere between 5000 and 6000 patients. That's still your view.

Yes, Eric?

We currently are --yes, our current --what we've seen in the published literature and the work that we've done in terms of screening program, particularly the risk population, suggested that --that is a sort of global number. Now remember, this treatment is not sort of a simple product that you're going to use like a tablet and oral or even an infusion. So it requires stereotactic approach, surgery and follow-up. So the intervention and treatment of the patient is going to be slightly more complicated than sort of your average treatment that we would do. So in terms of how and what we believe the number of patients that exist, it's credibly important to know that we have made important strides in finding these patients through the genetic testing program, the pinpoint program in the US and spinal patients, saliva programs that we're using are simple and easy to use. And we're finding patients in many of the countries where we know that gene therapy are currently being more reimbursed, and that's really important.

Okay.

Because they're there. And we're -- the beauty is we're finding them everywhere as well in many different countries. So I think we're in pretty good shape that still gives us the confidence that there's about 5,000 patients there.

Okay. Thank you. And then if I could squeeze one in on Huntington. Just to clarify, are you planning on showing knockdown for a wild-type by the end of this year?

So in the -- with that, we're looking at both. We don't discriminate between wild-type in here. So yes, you'll be seeing the overall -- the levels reflect the overall levels of the RNA that we see since both of them, both wild-type and mutant RAC, so you'll get that as well as protein level reduction from both.

Okay. But will you be specifically highlighting what the wild-type knockdown is?

I think we'll be showing -- we'll be able to say what the wild-type knockdown is based on the over, so differentiation between the two. And that's nice.

Okay, Got it. Yes.

249 is 50. So it's a one-to-one ratio.

Okay. Got it. Thank you.

Thank you. Our next question comes from a line of Brian Abrahams with RBC Capital Markets. Your line is open.

Hi. This is Steve on for Brian. Thanks for taking our question. Another one on Huntington's. I'm curious what is known about how the neuron adapts to accumulation of mutant Huntington over time. And given the data from animal models or preclinical models that might tell us whether it's a rapid depletion of the mutant protein could cause any inflammation or dysregulated protein turnover? Thanks.

We don't have any. I think there's been several studies that show in terms of clinical benefit right in animal models, that shows the lowering, lowering of HTT results in improvements in animals. So I think I don't think you have a rapid reduction in that sense that's causing any sort of unusual consequences that I know of at least in the animal studies.

Thanks.

Thank you. Our next question comes on the line of Peyton Bohnsack with Cowen. Your line is open.

Hi, guys. This is Peyton on for Joe. Thanks for taking my question, and congrats on the strong quarter. I was wondering if you could provide a little more background on why ALS is chosen for PTC857 instead of some of these other CNS disorders or neurodegenerative disorders? And any timeline on when you'll release more details on the trial design? Thanks.

Sure. So maybe I'll start and then pass it on to Matt. I think if you think about 857 the whole bio-e platform and knowing that really in terms of excess electrons that leads exacerbate oxidative stress, and turns on inflammation causes aggregation. It’s a key. So 85 -- 15-lipoxygenase is a key interim in this process. And then when you're in a sense -- when the system of sopping up end of electrons gets overwhelmed. This is sort of the emergency response system that ultimately turns on the inflammatory response to try and fix things. So, it's a real problem that it gets turned down and doesn't get turned up. But I guess the important point is that can be used in a -- why it happens in all of the neurodegenerative diseases, as well as many other things. So, even go through a multiples of them, and our notion was to look at a number of them. And maybe Matt would go through them. And that's the idea we will be doing that, but Matt why don’t you go through as to why we're picking up ALS as the first example.

Yeah, sure, Stuart. As you mentioned, the entire preclinical program has been based on the understanding that targeting 15-lipoxygenase and its pathway of oxidative stress and inflammation is critical in a number of different neurodegenerative disease pathologies, so including ALS, including Parkinson's disease and others. So what we've done is looked at a number of different in vivo and in vitro models and a number of different diseases have been able to show strong efficacy, efficacy across all of these models, some that are generic synergy and others that are disease specific. So we arrived now with the Phase 1 data in hand and the ability to move to Phase 2. And our selection of move starting first with ALS is based on the fact that right now we have three months. We have tox studies to support three month dosing. And when we think about neurodegenerative disease development, one of the key -- two the key considerations actually are; one, having being able to those for long enough to see change, so rate of progression of the disease. And then, also being able to, of course, identify the right patients that are going to change over time in a trial so which are able to show benefit. One of the key advantages of ALS is that, unfortunately, it's a rapidly progressive disease. And despite there being two approved therapies there's still significant unmet needs. The diseases are rapidly progressive and fatal with the majority of patients dying between 18 and 36 months following diagnosis. But over the course prior to that ultimate demise of the patient with ALS, is a rapid decline in neurological function or muscular function and respiratory function, all of which are readily measurable. We also have an ALS a validated endpoint, the ALS FRS, which is known to change over a three month period of time, and allows us based on use of both placebo group as well as robust natural history data, able to show in a three month treatment study with PTC857 that we can have an impact on the disease. So what we have here is a disease in ALS, where our preclinical work was understood about the pathogenesis disease and the importance of our target pathway 15-lipoxygenase in that disease, we have an opportunity that three month study to show a treatment effect that can form a then definitive registration directed study. So just to summarize, basically, the selection of ALS, as the first indication basically are in terms of the toxicology program being having three months data complete and being able to do three months of dosing to be able to have an ALS disease, we're in that period of time, we can collect the necessary data to show PKPD effect, and then be able to move on to efficacy. So right now, we're in the process of designing that trial. It’s going to be probably elements of the running phase to establish a baseline rate of progression of disease and at least have in the three months treatment window. But we're still sorting out the exact details, there'll be a placebo, and dose groups as well. We use very standard ALS endpoints. Obviously, I mentioned the validating ALS FRS scale, which is a validated endpoint for which has been used for approval previously, as well as other important biomarkers and key indications of pharmacodynamic effects, we’re thinking about the [Indiscernible] development of both the disease bearing ALS and the mechanism of action [Indiscernible]. And we plan to begin that trial in the first quarter of 2022. And we’ll provide more details on the full study design analysis.

Yes. That’s very helpful. Well, just one more quick kind of follow on question to that. Do you plan on going into other indications or will you wait until this trial is done with the data?

Our goal will be -- this is, I think, it's more of a timing issue than anything else, because of having short versus long term toxicology. And we've always -- I think we spent the adult neurodegenerative as indication was the GBA, Parkinson's disease and ALS is more of a matter of timing to get into that.

Okay. Thank you. That was very helpful.

Thank you. Our next question comes from the line of Danielle Brill with Raymond James. Your line is open.

Hi, this is Alex on for Danielle. Thanks for taking the question. I was looking to see if you could provide any color on your plans for the 518 Huntington's Phase 2 patient pool. We've been hearing from KOLs that the patient pool should be as early stage Huntington's disease as possible to capture the benefit. Is it feasible to address in the Phase 2? And if not, could you share your thoughts on how you're approaching the enrollment criteria for the patient pool in Phase 2 trial? Thanks.

Sure. I mean, I'll make a general statement on that. Obviously the -- in any of these diseases that are either neuromuscular or neurodegenerative where they -- where you see, they always wants to get in as early as possible. But still could be in the range of while you're in early that you that you -- that there's some decline that you can measure, right. So that, at the end of the day, if you come in too early, the decline takes too long for critical transparency, so you have to hit the right patient population, choosing the right endpoint in the range like just -- pretty much like a Goldilocks, right? Too early, it doesn't help you and too late doesn't help you. So you have to find the right patient population. And that's -- that takes a fair amount of looking at the natural history in trying to define what's the right patient population, or what's the right outcomes for that particular population. It can be clear in a given amount of time that you're going to do an experiment, that you have high confidence and then define the patient, is the inclusion-exclusion criteria, that gets you the patient population, that you have some confidence and will be declining. So that's the philosophy of what we're taking in next. And the teams were doing a lot of thinking about that. So -- also, if there's anything else, Matt, you want to talk about.

I just -- it’s okay. I think the point that you raised Alex is assuming in-force, this concept of the Goldilocks population where we're sure that we have a population that's early enough in disease that you have one, the ability to affect the disease progression. And especially, if our overall approach is acting upstream with the disease biology, you want to make sure that you're early enough that you can actually affect the disease progression, but also make sure that you can still have a meaningful amount of change in an untreated, right, because the key here is to able to show benefit over placebo. And to do that, that's really a matter of now, that during the duration of the trial, you'll have placebo receive a group that had an absence of therapy is going to decline enough that you can show the clinical benefits. And so, we've been spending a lot of time availing ourselves of the existing databases like the -- I think, we always only database over 20,000 patients. We work that in-house with our teams and external KOLs as well working with us are looking very carefully at the important factors like CAG repeat, and a number of different endpoints that are collected to really find one, that that population, let's get it moved by Goldilocks properties as we said. And second, the appropriate endpoints to actually measure those changes overtime. So what you're going to see from us, as this workflows are continues in our Phase 2 trial, is first and foremost, obviously, to go over Phase 2 trials to be able to demonstrate the effect of HTT mRNA. And protein lowering in Huntington's disease patients will obviously be enrolling patients that based on our work. We believe are reasonable to show that in, but who also have changed and other measures of disease. Importantly, things like geographic changes, is what we want to look at as biomarkers of disease, both what they say the geographic to be able to then tie into demonstrating the benefit of reduction in HTT mRNA and protein. So obviously, to do that, we want to make sure we are making the direct template and again, have the right patients who are going to change overtime, so that we can show a benefit in those patients.

But on the other hand, maybe I'll make also a bit. I think, there's, some interesting things going on. And based on the experience with Alzheimer's experienced with the FDA, we do plan to discuss with them a pathway for accelerated approval focusing on relevant biomarker. I mean, if you think about the practice in the plaque and Alzheimer that was used, here you have, I think even a better case for the monogenetic disease. You're targeting the precise protein that's mRNA that's involved in the process. You know, that as soon as a new company says, there's Natural History data shows that reduced levels of immune protein, extend the time before you see the onset of the disease. So there certainly is a possibility we'll be able to at least, have a discussion with the FDA. Probably Novartis talks about it as well, that they've had a discussion with both the AMA and the FDA. So if that's the case, we're in a very good position to see if we could work with that endpoint for potentially accelerated approval. And then what we've been talking about because certainly that is for the second study.

Great. Thanks so much for the color. And thank you for taking the question.

Thank you.

Thank you.

Our next question comes from the line of Gina Lovering with Barclays. Your line is open.

Hi. This is [Indiscernible] for Gina. Thanks for your question. I have a couple 518 I think in the past, you mentioned that beyond the 15mg and 30mg make max doses we have another two to three doses. Could you comment on in the 3Q data updates, how many those levels would include? And if you can share, what doses they are? And my second question is, from this healthy volunteer trial 2 the phase 2 trial, how would you define the optimal therapeutic window? Thanks.

Sure. So what we've talked about in the past was in the singular test does, we went up to 135 milligram and those dose cut down to around 50% of the mRNA level, which, in a way, probably in 90 to 135 equates to 100% reduction of HTT. In the multiple ascending dose of 15 and 30 milligrams we were even at the 15 milligram dose we are able to get to somewhere between 40% and 50% reduction after 14 days of treatment. So, we were -- we were, so if you could -- it shows you really quite nicely, that 50 milligram which is the lowest dose that was in our trial got to that and 30 milligram got served between 60% and 70% reduction. So, clearly the -- we're able to -- be able to titrate, the level of HTC mRNA depending on the exposure of that. The other things, I think, what we're doing is really doing -- as we said, looking at food effects, going food effects -- looking at CSF, in order to really in a sense we've -- in a sense, we've already in the range of where we are thinking about the dose that we launch, which is somewhere between 15 and 30 milligrams because that gives us already the 50% reduction, that will probably start with in terms of reducing. So I think we're in a pretty good position, and the next step there will be really to reproduce, and begin to look at the biomarker as a consequence of looking at the biomarker of HD -- HTT in the HD patient. Just to make sure that the exposure and reduction that we see is doing well. And then also, what we said is that, we're looking at CSF and the CSF is so that -- and just a PKU study. So we know that would just define and ensure that what we see in the blood is equivalent to what we've seen in the CSF. So I think, what we're trying to do is that we received the low -- the desired lowering at the lowest dose that makes them comfortable that we're in the therapeutic, that we're in the therapy of range or efficacy and we already know that, with 15% 15 milligram dose range. Ii that help you?

Yes. For the CSF cohorts will that cover at one dose level or will do covered multiple dose level in that cohort?

We're only doing one dose level, right.

Yeah. You really only need one dose, this back -- this is business simple pharmacology we basically need the single dose level. Obviously based on the dose proportionality, we've seen throughout the not only the SAD and MAD worked, but all the pre-clinical pharmacology. I think one thing you can say, one thing that translates very well in our degenerative diseases is the pharmacology models from pre-preclinical to clinical right sort of the what we've learned about the bio-distribution and what we've learned about the predictive pharmacology we able to assess a single dose level verify at a single dose all the way in Human.

Very helpful. Thanks.

Thank you. Our next question comes from the line of Raju Prasad with William Blair. Your line is open.

Hi, there. This is Sammy on for Raj. Congrats on the quarter and thanks for taking our questions. There was recently a paper published in Nature Communications that came out of an academic centre in which they used in, a, DC gene therapy that was administered to the substantia nigra and ventral tegmental area, and that ultimately led to some pretty compelling improvements in motor function. Just want to get your thoughts on targeting these midbrain regions as opposed to putamen? And if you would consider conducting a post-approval study examining the administration of PTC-AADC to them? And then I have a follow-up.

Yeah. Thanks for the question. So that was done in a clinical -- at a university setting where you said in substantia nigra. And so I think if you look at the results that we've had, where we're, it's underway in terms of the work we've shown going into the retainer, the really profound results that we saw in a much larger number of patients that were looked at for five years in a clinical study, as well as five years after. So we have up to 10 years of continuous results. And I think you can -- I think what we see is that we saw durable neurological neuromuscular improvement, again, up for 10 years. And I think we have the only therapy for AADC. That's an active regulatory process with the EMA that was submitted in 2020. And we also plan to submit the BLA by the end of the year. So I think that we're uniquely positioned to picture that PTC-AADC is available to all AADC spaces around the world that needs this, I think transformative therapy. And I think, when we thought it, the reason we like to retain them is that obviously, in all cases showed improvement, we have many patient to show that, and then the other thing that I think is an issue is that the midbrain is a much deeper structure that we think there's less space to get to. So I mean, this selection would be based on the choice that was based on a number of factors. And I think the results of that have really shown that is really, I think, quite spacious, transformative. It's where the dopamine neurons are and shown to be quite active in the data. So we feel pretty good where we're at, and then we were doing all the other necessary or regulatory events, requirements to bring the gene-therapy to patients.

Got you. Thank you. And just a separate thought, I felt like we haven't heard too much about your oncology pipeline before, and it's a little divergent from your other therapies, which mainly target rare genetic disorders. Could you remind us what those candidates are and your clinical development strategy for them?

Yeah, thanks for that question. So, what are -- the oncology program that we're working on is there's -- it's for two compounds, one is called Unesbulin, which was previously 596, and then Emvododstat, which is a PTC299. And you heard a little bit about that, with the COVID-19 plus some sort of trials for AML. And we are planning a deep dive update on the program's exit quite shortly and sharing the results of these programs as well. PTC on UNESCO is in clinical trials for CITG and LMS. CITG is a rare pediatric brain tumor. It's estimated to have about 300 patients per year that are diagnosed in the US. LMS is a rare adult solid tumor and muscles with an estimated 4,000 patients diagnosed per year in the United States. Both of these programs have higher medical needs with really few beneficial and no treatment options. And so of these programs have been ongoing. So it's very much reminiscence of a rare disorder, a rare disease approach. We anticipate having the results of these in the second half of 2021 for the clinical trials. And so I think we're quite excited about that. And with positive results here, we have the potential to initiate registration directed trials following these results. So we're -- and then with a bonus stack within AML we also expect results by the end of 2021. So these are two additional programs, programs and molecules that we have not talked much about what we're going to be starting right. Now getting into position to talk to you -- talk about them and have some data. I think would be quite exciting.

Great. Thank you. I look forward to seeing that data.

Thank you.

Thank you. I'm showing no further questions in the queue. I would now like to turn the call back over to management for closing remarks.

Thank you. So thanks for joining us today. As we shared our second quarter highlights, I believe the progress that we've made in this quarter is really a result of the dedication of our people. And while the pandemic is ongoing, I really am continually impressed by the development team that has made substantial progress across the full pipeline. And we're excited to continue this year, these updates with you as they become available. Also the in addition to that, I think the perseverance and execution of the global commercial team has resulted in PTC raising our 2021 revenue guidance for the DMV franchise. And we look forward to the continued -- continued execution of this in the second half of this year. So thanks for joining and look forward to talking to you also.

Ladies and gentlemen, this concludes today's conference call. Thank you for your participation. You may now disconnect.