TG Therapeutics, Inc. (TGTX) Q2 2021 Earnings Report, Transcript and Summary

Greetings. Welcome to TG Therapeutics Second Quarter 2021 Earnings Call and Business Update. At this time, all participants are in a listen-only mode. A question-and-answer session will follow the formal presentation. [Operator Instructions] Please note this conference is being recorded. At this time, I will now turn the conference over to Jenna Bosco, Senior Vice President, Corporate Communications. Jenna, you may now begin.

Thank you. Welcome, everyone, and thanks for joining us this morning. I'm Jenna Bosco, and with me today to discuss the second quarter 2021 financial results and provide a business update are Michael Weiss, our Chairman and Chief Executive Officer; Adam Waldman, our Chief Commercialization Officer; and Sean Power, our Chief Financial Officer. Following our Safe Harbor statement, Mike will provide an overview of our recent corporate developments as well as an update on our current pivotal programs and remaining key goals for 2021. Adam will then provide an update on our commercialization efforts and Sean will provide a brief overview of our financial results, before turning the call over to the operator to begin the Q&A session. Before we begin, I'd like to remind everyone that we will be making forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements include statements about our anticipated future operating and financial performance, including sales performance, projected regulatory milestones, clinical development plans and expectations for our marketed and pipeline products. TG cautions that these forward-looking statements are subject to risks that may cause our actual results to differ materially from those indicated. Factors that may affect TG Therapeutics' operations include various risk factors that can be found in our SEC filings, including our most recent reports on Forms 10-K and 10-Q. In addition, any forward-looking statements made on this call represent our views only as of today and should not be relied upon as representing our views as of any subsequent date. We specifically disclaim any obligation to update or revise any forward-looking statements. This conference call is being recorded for audio rebroadcast on TG's website www.tgtherapeutics.com, where it will be available for the next 30 days. All participants on this call will be in a listen-only mode. Now, I would like to turn the call over to Mike Weiss, our CEO.

Great, thank you, Jenna, and thanks, everyone, for joining us today. During the first half of 2021, we hope that our long-term goals and vision for TG -- TG have really come into focus for investors. Our first phase of our multi-phase strategy now complete with the accelerated approval of the UKONIQ, the first and only dual inhibitor of PI3K-delta and CK1-epsilon for the treatment of relapsed or refractory marginal zone lymphoma and follicular lymphoma. We are very proud of these accelerated approvals for patients who have failed prior therapies and have limited treatment options. We estimate approximately 8,000 patients each year will be seeking treatment in our approved MZL and follicular indications, which we see as an excellent starting point for our commercial efforts. Building on the momentum from our UKONIQ launch, we have submitted and received a PDUFA target goal date of March 25, 2022 for a BLA application requesting approval of the combination of UKONIQ plus ublituximab, our novel glycoengineered anti-CD20 monoclonal antibody, the combination of which we refer to as U2, for the treatment of patients with chronic lymphocytic leukemia. We have also submitted a supplemental New Drug Application, sNDA for UKONIQ for the same indication and received the same PDUFA date for the sNDA. We are excited about the potential to bring our novel U2 combination to CLL patients, especially those who have failed or who are not good candidates for current standards of care. CLL is a significantly larger patient population than marginal zone and follicular. We currently estimate that approximately 30,000 to 40,000 patients will be seeking a new treatment each year in our proposed CLL indication. Not only is CLL multifold larger patient population than marginal zone and follicular, but we would expect the median duration of treatment to be longer in CLL as well. One other important factor to note is that we believe that 85% of our target prescribers for marginal and follicular lymphoma are the same prescribers that will be targeting -- that we will be targeting for chronic lymphocytic leukemia. So the significant efforts our team has made in building relationships for the marginal zone and follicular launch should translate nicely into our potential CLL launch. Next up in our multi-phased approach is the largest patient population we will be addressing, which is patients with relapsing forms of MS with ublituximab as a single agent. We are targeting a submission of a BLA for MS this quarter and hope to receive a target PDUFA date in the third quarter of next year. We believe our Phase 3 data supports an attractive treatment option for patients with relapsing forms of MS. Entering MS will also raise our commercial profile significantly as we expect to participate as one of only three anti-CD20 monoclonal antibodies and what is then projected to become a $10 billion to $15 billion per year market just for anti-CD20 molecule antibodies in the treatment of MS. But the core focus will be on the regulatory and then commercial execution of these first three opportunities, especially the larger market opportunities in CLL and MS. We will continue to seek to enhance our Hematology Oncology franchise by broadening the potential U2 label to new indications such as in marginal zone and follicular lymphoma and also into new combination uses of U2 in CLL, for example, in combination with venetoclax and our very own TG-1701. The ability to combine with standard of care agents in CLL, we hope will bring better outcomes to patients and should also broaden the potential penetration of U2 and CLL. On the MS side, we will seek to build on ublituximab potentially in other auto-inflammatory diseases, as well as seek to build additional programs in MS. With that, let me provide some recent highlights related to our initial commercial launch efforts with UKONIQ and our key regulatory efforts and development programs. First, let me just remind everyone and restate that in February, the FDA granted accelerated approval of UKONIQ for the treatment of adult patients with relapsed or refractory marginal zone lymphoma who have received at least one prior anti-CD20 based regimen, and for adult patients with relapsed or refractory follicular lymphoma who have received at least three prior lines of systemic therapy. This approval was based primarily on the results from the UNITY NHL trial, which were recently published in the Journal of Clinical Oncology. On the commercial side, UKONIQ became commercially available a few weeks following approval, and overall, I can say we are extremely pleased with the performance of the commercialization efforts to date. Launching during a global pandemic is no easy task, but under the circumstances, the team has done a really nice job in engaging target prescribers, both commercially and educationally under the leadership of our Chief Commercialization Officer, Adam Waldman. Adam will join us shortly to discuss some launch metrics and give some high-level qualitative assessments of the launch thus far. I don't want to steal his thunder, but again from where I sit, the launch is going well and believe is positioning us for future success with the potential approval of U2 for CLL early next year. Speaking of which, and as noted above, the BLA and sNDA for U2 in CLL have both been granted a PDUFA target goal date of March 25, 2022. For the MS Program, we were pleased in the second quarter to be able to present the positive results from our ULTIMATE I and II Phase 3 trials evaluating ublituximab in relapsing forms of MS at two major conferences, the American Academy of Neurology Annual Meeting and the European Academy of Neurology Annual Meeting. As mentioned during our last call, both studies met their primary endpoint with ublituximab treatment demonstrating a statistically significant reduction in annualized relapsed rate referred to as ARR. with ublituximab treatment resulting in historically low levels of ARR. We believe these results are highly encouraging and showcase the potential of ublituximab to provide an efficacious treatment option in a one-hour infusion every six months following the first dose. The expert feedback we have received thus far has been very positive, and our one-hour infusion, that's viewed as an important benefit for both physicians and especially their patients. These trials were conducted under special protocol assessment with the FDA and we are on track to complete a BLA submission for ublituximab to treat RMS this quarter. And briefly before I turn the call over to Adam, I want to provide a quick update to our combination and pipeline programs that we hope will be drivers of future growth. Starting with U2 plus venetoclax, which has moved forward now into Phase 3 for patients with CLL within the ULTRA-V trial. The Phase 2 portion of the ULTRA-V study completed enrollment earlier this year. You may recall that at last ASH in December, Dr. Paul Barr of the Wilmot Cancer Center in Rochester, New York presented preliminary results from his Phase 1 study of the U2 plus venetoclax combination, which included results from the first 27 patients in the study to complete the 12 cycles of fixed duration therapy. In those patients, there was 100% overall response rate and greater than 75% of the patients achieved undetectable MRD in the bone marrow. We view these results as highly encouraging and we look forward to presenting updated data from this Phase 1 trial later this year with approximately double the number of patients through 12 cycles of treatment. Next, let's discuss TG-1701, our investigational BTK inhibitor. We were pleased to present updated results from the Phase 1 trial of TG-1701 as a monotherapy and in combination with U2 last month during the summer Oncology Meetings, including ASCO, EHA and ICML. We were pleased to see that with additional patients treated with TG-1701, it continued to show encouraging clinical activity paired with what appears to be a tolerable safety profile. As I mentioned earlier, we view these triple therapy trials as a way to enhance the utility of U2 in the treatment of CLL. Further in the clinical pipeline are our CD19, CD47 bispecific antibody referred to as TG-1801 and our PD-L1 antibody referred to as TG-1501 or cosibelimab. Both are moving through early stages of testing with the possibility of data later this year or next. 2021 has been a very busy year for us as we've made significant progress on both the clinical and regulatory fronts and look forward to an impactful end of year and into 2022 as we strive to expand our commercialization efforts into CLL and MS. With that, I'm excited to turn the call over to our Chief Commercialization Officer, Adam Waldman to share some highlights from our early commercialization efforts. Adam?

Yes. Thanks, Mike. And I'm very excited to provide a commercial update for the first full quarter of the UKONIQ launch. Let me start with some numbers and then provide some qualitative assessment. As you've already seen in the financial press release, we achieved $1.5 million in net sales in UKONIQ for the second quarter, which was our first full quarter of sales. While we were quite pleased with the extent of our launch penetration, which by our estimates, reflects UKONIQ capturing 3% to 4% of new patient starts in our labeled indication. In our view, that is a great starting point that is ahead of our internal projections. Importantly, our net sales figure doesn't fully capture the total demand for UKONIQ in this past quarter as the amount of free UKONIQ provided to patients through our patient assistance program has been significant. Many of our patients are covered by Medicare Part D and their out-of-pocket costs are very high due to the Part D benefit design. In addition, unfortunately, unlike CLL there is a general lack of financial systems available to support marginal zone and follicular patients with their out-of-pocket costs at the current time. This dynamic is leading to a high percentage of patients qualifying to receive free products. To give you this sense of the extent of the free product offered, we provided over 35% of the UKONIQ bottles [ph] v to patients free of charge through our patient assistance program in the second quarter. As we have said over and over, we are committed to helping patients access our products and we are proud to be able to help those in need by providing UKONIQ free of charge. When we look at the volume -- when we look at the volume of our overall demand, which includes free products, we are extremely pleased by the early uptake for UKONIQ. As we've stated before, our goal with this initial launch is to get as many accounts, prescribers and patients to have a positive experience with UKONIQ as we build towards the potential CLL launch early next year and we believe ensuring patient access with a strong step towards achieving that goal. Based on these early trends and current assumptions, we are targeting $7.5 million to $12.5 million in net sales for the full year 2021 assuming a similar rate of free goods for the remainder of the year to support UKONIQ for those who cannot afford it. And further, we would expect to see nice growth in our net sales for 2022 and currently we are targeting net revenues for 2022 to be between $50 million and $75 million assuming the approval of U2 by the March 25 PDUFA date allowing for partial sales of U2 in both front line and relapsed refractory CLL and a small contribution from ublituximab in MS for which we hope to have a third quarter 2022 PDUFA date, all of which puts us on pace for our 2025 goal of achieving $1 billion in corporate wide sales. Now, let me provide some additional color beyond the numbers. While it is still early into our launch, we are pleased with our execution and believe we have made significant progress to date. Our strategy has been the focus on the approximately 1,000 higher volume community and academic accounts, representing approximately 3,000 hematologists oncologists that see the vast majority of the eligible patients in our indications. What we have seen is that most of the initial adoption has occurred within these targeted accounts, and in fact, a large percentage of the initial utilization is coming from centers that were evolved in our clinical trials. In many cases, we are seeing repeat prescribing of these accounts as well, which we also view as a positive sign. And although still early, we are pleased with the initial refill rates we are seeing which we view as a reflection of both the clinical profile of the UKONIQ and that providers are effectively navigating potential toxicities and keeping patients on therapy where appropriate. This growing experience build comfort and confidence for our expanding prescriber base and our team is doing a fantastic job with educating and supporting clinicians in safely managing patients. We continue to receive very favorable feedback on the UKONIQ clinical profile. Insights from our recent launch tracking studies show how -- show strong product performance, message recall, product perceptions and importantly intent to prescribe once physicians have appropriate patients. When our teams have engaged our target healthcare providers, they see UKONIQ is having a differentiated profile and view it as a valuable treatment option for both relapsed refractory marginal zone and follicular patients. However, gaining access to our customers remains a challenge. COVID related restrictions have persisted affecting our ability to access all of our targeted accounts. And although the situation did improve modestly throughout the quarter, with an increasing percentage of our in-person engagements, the most recent trends in the delta variant have caused some institutions to re-institute certain visitor restrictions potentially reducing the opportunities for in-person engagements in the coming weeks and months. One other important COVID related trend relates to patient visits. Marginal zone and follicular, as you know, are relatively small patient populations to begin with, and they -- most physicians only see a few of these patients that fall within our labeled indications in a given year. But it appears that since the onset of COVID, patient visits and treatment starts have decrease in the lymphoma [ph] across the Board. Most of these patients are elderly and may have been reticent to visit oncology offices during the pandemic, we believe this continues to be an issue and we have not recovered back to pre-pandemic numbers quite yet. These trends make our initial uptake even more impressive and essentially bode well for an increasing patient flow once the pandemic is behind us. Another positive note is that payor coverage has not been a challenge to date. The team has done an exceptional job here, they have been able to achieve broad coverage of UKONIQ very quickly. More than 90% of commercial and Medicare lives have confirmed coverage to our label or NCCN compendia. We are committed to making sure that each and every eligible patient and healthcare provider has a positive experience with TG and UKONIQ. When a healthcare provider and their patient have a positive experience with UKONIQ with strong educational and access support from the TG team, we believe that the healthcare providers, they're more [ph] likely to prescribe UKONIQ for additional appropriate patients in the future. We also believe that this will carry through to their CLL patients, assuming approval of U2. As Mike mentioned, we estimate there's roughly an 85% overlap of healthcare providers within our target base across lymphoma and CLL reinforcing the importance of what we're doing in establishing our footprint with this launch. So with that, I'd like to thank you very much for being here. And I'd like to hand it over to Sean Power.

Thank you, Adam. And thanks everyone again for joining us. Earlier this morning, we reported our detailed second quarter 2021 financial results, which can be viewed on the Investors and Media section of our corporate website. For today's call, I'll keep my remarks brief and touch on a few highlights from the quarter, beginning with our cash position. We ended the second quarter with approximately $456 million in cash, cash equivalents and investment securities, which we believe will be sufficient to take us into 2023. As Adam noted earlier, we are pleased to report $1.5 million of UKONIQ net product revenue in the second quarter, our first full quarter of product sales. Our net loss for the second quarter of 2021, excluding non-cash items was approximately $62 million, which was a decrease of $12 million quarter-over-quarter from Q1 of 2021 where we saw a net loss, excluding non-cash items of approximately $74 million. Given that Q1 of this year was our first quarter as fully commercial entity, it's probably a more apples-to-apples comparison to what we saw this quarter. As compared to the first quarter of 2021, the decrease of approximately $12 million was primarily driven by one-time licensing milestone payments of approximately $14 million recurring in Q1 of this year. If we shift and compare this quarter to Q2 of 2020 where we saw a net loss, excluding non-cash items of approximately $46 million, that increase is primarily related to increased selling, general and administrative expenses associated with the launch of UKONIQ and planning for the potential future launches of U2 in CLL and ublituximab in RMS. Our GAAP net loss for the second quarter of 2021 inclusive of non-cash items was $78.5 million or $0.59 per share compared to a net loss of $52.9 million or $0.47 per share during the comparable quarter in 2020. With that, I will now turn the call back over to the conference operator to begin the Q&A.

Thank you. At this time, we’ll now be conducting a question-and-answer session. [Operator Instructions] Thank you. And our first question is from the line of Alethia Young with Cantor Fitzgerald. Please proceed with your question.

Hey, guys, thanks for taking my questions and congrats on the early progress with the launch. Maybe just a couple from me. One, just I wanted to get a bit more color about how you were talking about during the COVID trends, just how much penetration have occurred into the roughly around, I guess, 3,000 heme/onc? And kind of how has that kind of ebbed and flowed like -- it sounded like it might start to slow a little bit in light of the Delta variant? And then, my second question is just as far as a differentiated clinical profile like an MZL and follicular, especially on the safety, I just wanted to get some color around how that's going and some of the early experience. I know it's still super early, but just any kind of color you can provide there? And then I was intrigued by kind of the -- when you said the 2025 $1 billion in sales, like, can you give us a little bit of framework about how to think about what that breakout might be between like multiple sclerosis and the hematology indications? Thanks.

Yes, sure. Mike, do you want me to take those? Hello?

I'm sorry. Yes, please. I was on mute.

Okay. Okay. Yes, Alethia, thank you. Doing this in the -- over the lines, it's a little tough. So sorry. So the first question around penetration, we are -- I think given the pandemic, we're -- and as I've mentioned before, we've hired a really experienced team, they came in here with relationships and existing connections. So our penetration has been very good, especially in the top centers. The issue is with -- just with frequency and just how often you can get into these centers and with a new product, it does take multiple visits sometimes to discuss the full profile, the mechanism, the patient populations and it does take some time with -- so to answer your question, penetration has been good, especially into the top accounts. We're working on frequency. We're starting to see that, and as I mentioned, things did get modestly better in the second quarter. We were seeing increases in live engagements, which we think is a more effective way of communicating. However, with the Delta variant in the last few weeks, we are seeing reversal of those trends. And so it's getting -- we're starting to see -- cancer centers start to restrict live engagements again. So we'll have to watch that and see how it goes. But in general, we feel like live engagements are better. Our penetration has been good, but obviously it's a fluid situation. Alethia, can you remind me of the second question?

Feedback on like kind of the use as far as the safety differentiation that could be seen with UKONIQs.

Yes. I mean, the feedback has been really positive on the profile. They see it as very differentiated. As I mentioned before, the lack of a black box warning is seen as differentiating versus the other PI3Ks out there. And I think it just takes time for when they see a patient and when a patient presents himself, and these patients don't show up on an individual physician basis that often throughout the year. So when we're able to get good frequency of interaction a patient shows up, that's when we're getting use. But the feedback on the product has been very, very positive. And then, as far as the breakdown in the $1 billion, as I mentioned, we expect a small contribution from MS given that we are expecting a late in the year approval there. We expect to get some contribution from U2 given that we would have three quarters of use of approval. And our ability to promote U2 and CLL starting in the second quarter is our expectation. And then the continued launch of marginal zone and follicular will continue to form the base of the revenue projections.

Alethia, just to clarify, Adam was referring to 2022 in his answer.

2022, got it.

That was for 2022. For the $1 billion in 2025, I don't think we've gone as far as to say that, but I think at that point, we should be in a 50-50 or trending toward larger contribution from MS at that point.

Okay.

Because the models that we have in forecast are, there is some flux between bull and bear cases. And so I think we're giving ourselves a little bit of flexibility there as well.

Okay, cool. I guess just a follow-up. Just -- you talked about these 8,000 follicular and MZL, which I mean could be a sizable opportunity itself. So I guess, I was just trying to get a feel between '22 and '25, how confident you are in being able to kind of penetrate this core group over time?

Yes. I mean, I think in terms of marginal and follicular, we feel pretty good about the potential for penetration. Again, I don't know what peak penetration expectations are overall. But I mean, I think if we were 20% to 30% penetration that would be pretty fantastic in any group where there is multiple drugs available.

Awesome. Great. Thank you.

The next question comes from the line of Josh Schimmer with Evercore ISI. Please proceed with your questions.

Thanks so much for taking the questions. First, on reimbursement and access. How do you expect to evolve from here for UKONIQ or for U2, the reasons to expect it will improve? And if so, what would those reasons be? Second, if you could discuss the pathway for full approval of UKONIQ, and what you expect will take to achieve that? And then last, maybe you could talk or even consider kind of rank ordering the obstacles to UKONIQ adoption, how much of it is COVID, how much is reimbursement, how much of it is awareness, how much is competitive therapies? And how you think those obstacles may alleviate in the coming months and years? Thank you.

Yes, Adam, why don't you go ahead with some reimbursement access and where you see things heading?

Sure. Yes, thanks for the question, Josh. On the access and reimbursement front, we really haven't seen many challenges. I think, as I mentioned, we have achieved broad coverage, the broad payer coverage and they are not experiencing any issues with regards to that. I think what you may be getting to where we can clarify, but that's -- I think we're good on the access and reimbursement side. I'll take the obstacles and competitive question, and I'll let you Mike talk about the full approval. I think the obstacles -- yes, I mean, as Mike mentioned in his remarks, launching in a pandemic is difficult. When we get in front of physicians, as I mentioned there, they have a very positive feedback on the product, but that's when we get in front of them and we're continuing to make progress there. And when we have those interactions, they are largely very positive interactions. And from our market research, it shows that they see it as a differentiated product and one in which is very compelling for marginal zone and follicular patients in our indications. There is -- I think the obstacles are the COVID in just getting access. I think there is some decrease in patient visits or patient treatment starts just given the reticence of some patients, as I mentioned, coming in to start a new treatment and I think those will be the biggest challenges. And I think they will hopefully alleviate when we get further down the line and get away from the pandemic going forward.

And Josh on the pathway for full approval of UKONIQ, so I guess, two points: one, the CLL, UNITY CLL trial will ideally support a full approval of the UKONIQ in CLL; and then converting the marginal zone and follicular accelerated approval into a full approval will require a randomized trial that we're in the process of finalizing the design with the FDA, and hopefully that study will commence before year end. The concept there will be some trial that will be in slightly earlier lines of follicular and then randomized trial with UKONIQ.

Adam, maybe you can kind of clarify on the reimbursement, the 35% free drug whether that's something you expect to continue or whether that may improve going forward? And if so, why?

Yes. I got you. Okay. Yes, good to clarify. So yes, I mean, in marginal zone and follicular, specifically, we're seeing a general lack of co-pay support funds available for Medicare Part D patients. A large part of the -- a large percentage of our patients in this specific indication are Medicare Part D over the age of 65. And specifically in marginal zone and follicular, we are not seeing availability of co-pay funds. We do expect that, that would change with CLL. We see much more funding available on CLL and this is much less of an issue with CLL. And then MS is a different ball game altogether. We're talking about largely commercial patients, so not as relevant. But -- so we would expect this to persist for this year. And then as we get into CLL, we would expect it to come down as an overall issue given the funding that's available in that patient population.

Thanks very much.

Thanks, Josh.

Thank you. Our next question is from the line of Eric Joseph with JPMorgan. Please proceed with your question.

Good morning. Thanks for taking the questions. I think the first is around your 2022 sales guidance. I'm just wondering what that anticipates in terms of CLL penetration and whether there is any anticipated impact to UKONIQ net price as combo therapy as opposed to use as single-agent in follicular and marginal zone. And then I'd also be curious to get a sense of what your latest thinking is around the European or EU commercial and regulatory strategies across the different franchises, both in hemo ublituximab [ph] in RMS? Thanks.

Thanks, Eric. Adam, do you want to take a crack? Let me take crack at the first one.

Yes. Why don't you start and then I'll weigh in.

Yes. So in terms of CLL, in terms of penetration, I think we're assuming given the point in time of the year that we'll get launched, which will be probably into the second quarter, that there'll be obviously some contribution from CLL in the year. In terms of the amount of penetration, I think we're even -- using even more modest penetration numbers than we found than what we're seeing right now with UKONIQ in MZL and follicular. And so we've been pretty conservative in those assessments. And then in terms of the UKONIQ pricing as part of the package, yes, we have not finalized pricing yet. So it's hard for us to give too much detail because, again, I don't think anyone knows what the -- we haven't given any guidance on the ublituximab pricing. But the most likely will be some discounting to UKONIQ in that setting, but it's really -- it will become a function of what we price, where we price ublituximab and to come together to basically come up with a total price that we think is fair for the patient population.

Got it. Second, sort of latest opinion on approaching the European commercial opportunity [ph] perhaps with the various product franchises?

Yes. So we're in the process of scoping that out still. We're moving forward with -- I think we're working towards -- I think the first application don't -- yes, I think I got to go back and check with the regulatory team. But the first application in Europe may be in MS. So we may actually end up staging it MS first and then CLL second there. But I think I need to probably get back to you on that. But we are definitely just moving forward. We think that the MS opportunity in Europe is a very interesting one for us and one that's managed probably more cleanly with a smaller team, certainly than we acquired in the US and that pricing in Europe will be a big driver of uptake. So we're still exploring that to make sure that those assumptions are valid. But assuming that's the case, we think there's a pretty interesting opportunity for European launch in MS, while we're still continuing to scope out how that pricing interplay with CLL will occur. So I think for the moment, I'm pretty sure we're going to head forward with MS first and then CLL second ex US.

Okay, great. Thanks for taking the questions. Appreciate it.

Sure.

The next question is from the line of Chris Howerton with Jefferies. Please proceed with your question.

Great, thanks so much for taking the questions. Congratulations on the progress.

Thanks, Chris.

I think for me -- of course. First, with respect to the U2 plus the venetoclax trials, I guess, I couldn't quite remember what the regulatory path is. Would the Phase 2 study be sufficient for an accelerated approval opportunity? I guess, is just a pretty simple question. And then with respect to the Phase 2 study itself, what would be the expected data disclosure? I know there was at least in my head, some anticipation that we would get the -- some of the data at ASH, but it might not be the full results. So I guess, some thinking around that would be helpful. And then the last question was just ensuring that everything is good to go with respect to CMC, particularly as it relates to ublituximab? Thank you.

Sure. So in terms of the U2-VEN program, we've been focused on three -- almost three full phases, right? So we had a Phase 1 that Dr. Paul Barr conducted as a lead investigator, and that Phase 1 is where we -- is what we've presented previously at last year's ASH, and it's what we've been committing to present later this year and update too. So I think we had 27 patients through 12 months in the first go around, and we're looking for somewhere between 40 and 50 patients through 12 months for the completion of the patients in that trial. So that is the U2-VEN data that we've been talking about as being presented later this year. In terms of ULTRA-V, as we've said, the enrollment completed early in -- earlier this year into the Phase 2 portion. And so that data to have all the patients through 12 months would not occur until after -- well after ASH. And in fact, we would need to be prepared for ASH, probably two months prior data. So the ULTRA-V data set, as I've noted multiple times, will be incomplete for this ASH. And if we could present a partial data set or not was really a function of what the principal investigator wanted to do. And so we're still trying to figure that out today whether we'll do a partial data set. But my general feeling is that it probably will not occur this year. And I've said this in multiple occasions, if it were me and I was the PI and we were that close to the -- to having all patients through 12 months, I wouldn't want to release a partial set when I could do a full set within a reasonable time frame of that. So we'll wait to hear back from the PI and what his decision is. But I think from where I sit, I wouldn't be surprised at all. And in fact, I'd be surprised if he said he wanted to present the partial data set. We'll see where it goes. But for the moment, the Phase 1 is where we'll see the U2-VEN data later this year, and ULTRA-V is more likely than not going to be a more complete data set next year. And then, in terms of the regulatory side of that question, once we have the full Phase 2 data through the -- at least all the patients through the 12-month time point, we'll look at that data, and we'll have a conversation with the FDA. Ideally, U2 will be approved at that time. So hopefully, it will have an easier pathway from the FDA to approval of U2 already being approved and venetoclax already being approved. But as we've, again said multiple times, there's no assurance that, that Phase 2 data will be usable for approval. If it is not usable for approval, of course, the Phase 2 portion will be published. We'll certainly send it over to NCCN and see if they're interested in adding it to their guidelines. And the Phase 3 is enrolling as we speak. So that's the current status of that program.

Great. Okay, that's awesome. And then, I guess just anything to note on CMC?

Nothing to note that we filed the CMC, I think it was the first section we filed as part of the rolling submission for ublituximab for the CLL application for ubli. And to my knowledge, there's been a dialogue back and forth. The FDA has been reviewing that file. And it's typical of any filing. There's questions that come in and go back out to the FDA, and that is the process that is ongoing but nothing to the team's great concern as far as I know.

Okay, fantastic. Well, thank you, Mike. Appreciate it, and hope to talk to you soon.

Thanks, Chris.

The next question is from the line of Ed White with H. C. Wainwright. Please proceed with your question.

Good morning. Thanks for taking my questions. So maybe the first question to Sean, you gave some guidance on SG&A expenses trending higher. I was wondering if you can make any comments on R&D. I know there was the $4 million charge in the quarter. But how should we be thinking about the second half of this year?

Sure. Thanks, Ed. So SG&A trended higher over last year -- over last second quarter, of course, as you'd expect, given the commercial launch. I think, it will continue to tick up a little bit over the course of the rest of this year, as I said, as we prepare the CLL and MS launches. And I wouldn't expect all that much on the R&D front, I would say, not a whole lot of volatility there over the remainder of the year.

Okay, great. Thank you. And then, Mike, just some pipeline questions, you had just commented on ULTRA-V Phase 2. Can you give us any update on how the Phase 3 enrollment is going? Are there any trends you can look at now to let us know when you think the trial will be fully enrolled? And then you had mentioned data later in this year for the Phase 1 trial. I'm just wondering for the other combinations and drugs in development, what we could potentially see at ASH this year?

Sure. So in terms of full enrollment into ULTRA-V, it's way too early, unfortunately, to give any kind of good projection enrollment when we started about a month or two ago. So it's -- we're in very early days for early stage of a trial. It's going quite well. But obviously, we're going to -- we got to see a big ramp at some point and then have a better sense of what the target enrollment time frame would be for that? In terms of data from the rest of the pipeline for later this year, certainly, we continue to enroll more patients in the TG-1701 study in the BTK. So that one will continue to eke out data at all the conferences, keep people updated on the progress of that program. And then with CD47, CD19 and TG-1501, those are continuing to be in the early stages and we -- again, I cannot promise data this year, as I noted. Potentially later this year, for sure, next year, I mean, we will have certainly something presented by next year, but potential for later this year. So, I think in terms of what to expect during the remainder of this year, the -- of course, the final data from the Phase 1 of U2 plus VEN, we'll see sometime later this year, more up to date -- more updated data on TG-1701 to come out. And I'm sure there's -- I know the team is working on sub-analysis of all the different trials, so there's other things that people are working on. But in terms of data sets that you have visibility at for the moment, I think those are probably the two primary data sets that are remaining. And like I said, some sub-analysis that we'll be coming out with.

Okay, thanks, Mike. And then, my final question is; you mentioned when you were talking about MS, other auto inflammatory disease indications and other forms of MS, I was just wondering, how should we be thinking about that potential? Should we be seeing potential study start in next year? Or is this further down the road than that?

I mean, I think it's possible to see some studies starting next year. We're working on a few concepts, and if they come to fruition, then yes, I would expect some things to start -- some studies to start next year. We'll keep you posted for sure.

Okay. Thanks, Mike.

Thanks, Ed.

The next question is from the line of Graig Suvannavejh with Goldman Sachs. Please proceed with your question.

Yes, thanks. Good morning. I've got a couple of questions, if I could. One, just on UKONIQ and it might be too early for you to comment, but can you provide an update on the number of accounts that you've penetrated and if -- and this might certainly be too early, but if you're seeing any reordering? I'm just trying to get a sense of what the ordering pattern dynamic might be for UKONIQ. And then a follow-up on UKONIQ is, it seems as if the way you're positioning the product relative to the portfolio, is that it's a very good product for patients and prescribers to get an overall good experience with TG Therapeutics. And with that in mind, I was wondering if you might be comfortable providing what you currently believe the peak revenue opportunity at UKONIQ might be? And then moving beyond UKONIQ, just looking at the MS landscape, any color that you might be able to provide would be appreciated just on what you're seeing in the anti-CD20 marketplace. Obviously, you've got Ocrevus there and Kesimpta is relatively new, but just wondering if you can comment on just how you're seeing Kesimpta in that launch and how that's having an impact either on Ocrevus alone or just the overall anti-CD20 market in general? Thanks.

Sure. Actually, Adam, do you want to start at the last question? We'll work our way backwards through. There's some questions about accounts and reordering on the UKONIQ side, but maybe while that question is fresh, maybe some MS commentary.

Yes, sure. Yes, we just saw -- I think Roche and Novartis just had a conference call last week. There was some dialogue around their launch there. So we're looking at that. It looks like there was some recovery from -- earlier in the pandemic, it looks like they are continuing to get some traction in the anti-CD20 space, the class itself is on a growth trend. Kesimpta is getting some traction in the market, but both seem to be holding steady and it's not growing now again as the pandemic continues on here. But -- so we're encouraged by it. I think the physicians that we talk to continue to be very excited about the class, excited about the use of the product earlier and earlier in arresting the disease. So we think it's good trends overall and that the class itself is growing, which we think is very positive. Let me talk about the UKONIQ, I think the first question was around accounts and reordering. As I mentioned, we are seeing -- where we're seeing usage is in our top accounts in the highest volume accounts. The split that we're seeing is about 60-40 academic to community. We're seeing -- we are seeing reordering from accounts. We don't have the specificity as a lot of it's going through specialty distributors, so we don't have the preciseness that we'd like to and perhaps we'll look into for future calls. But as I mentioned, we're getting good penetration in our top accounts and most of our usage is coming from there. And we are seeing reordering. And then, I think there was a question around peak revenue in -- I think it was specifically for UKONIQ. And I don't know if that question was around marginal zone and follicular specifically. But our view on that has not changed. We still see this as being a significant revenue opportunity. I think Mike, remind me what we've said in the past.

Yes. So, I'll take that one. So in terms of the positioning of UKONIQ and MZL and follicular as -- basically, that's a way for us to introduce TG to the world. That's been something that we said a year before the launch, six months before the launch, at the launch and now four months after the launch, we continue to believe that the UKONIQ introduction and marginal zone and follicular, most important is not about revenues, it's about introducing TG and UKONIQ for future impact in primarily CLL. And we said that -- consistently, we've said we think it's still marginal zone and follicular could be a few hundred million dollar revenue opportunity over time. I think that -- remember, we're taking away almost 40% of our sales right now. And if that's a trend that continues, it's a pretty big discount. But again, we think certainly at the point in which there's a few hundred million dollars of revenue potential, TG could be in a position to help fund hopefully with others, charitable organizations that can provide support for those patients. So I think it's -- at these levels, it's interesting to see that we're giving away so much for UKONIQ. But like I said, we made this very clear that we wanted to have a great experience for UKONIQ in marginal zone and follicular, and we did not anticipate giving away almost 40% free goods. But having said that, that's fine. We're happy to do it if it builds goodwill in the industry, and we want to make sure patients all have access. So, I think in terms of the consistency of that message, we've been extremely consistent about where we're positioning this launch. Again, having said that, I think in terms of penetration that we've seen, we've exceeded our expectations to date. And I think if we continue to grow in this marketplace and achieve somewhere in the order of 20% to maybe even as high as 30%, depending on a bull scenario, marginal zone and follicular, a few hundred million dollar opportunity. Again, we've never -- and we continue to say that the company is not being built on the back of the revenues from -- certainly from the launch phase of marginal zone and follicular, but we are going to be built on the impression and the positive feedback we get from the UKONIQ launch in marginal zone and follicular.

Yes. And Graig, just to clarify the -- my comments on the reordering, we're seeing reordering both in terms of multiple patients from the same accounts, and we're seeing a reordering in terms of refills as well. So just wanted to clarify that.

Okay, thanks for that.

Thanks, Graig.

The next question is coming from the line of Matt Kaplan with Ladenburg Thalmann. Please proceed with your question.

Hey, good morning, guys and thanks for taking the questions. Just a little follow-up on the ULTRA-V program. Can you give us some more color, I guess, on the ULTRA-V Phase 3 study design? Are there -- specifically, are there any differences from the Phase 2 portion of the study?

So the Phase 3 study design is U2 plus VEN versus U2. In terms of the actual treatment with U2 plus VEN, the -- I got to double check for you, Matt, but I think we may be using potentially up to three months more of VEN than we used in the Phase 2 portion, but that was only again, just to match up with the current schedule for VEN. But let me just double check for you but otherwise, not much in terms of differences.

Great, helpful. And then, with respect to your BTK inhibitor program, TG-1701, you presented some positive data recently at the medical meetings. What are your current thoughts on the regulatory path or have you identified, I guess, paths or pathways to the product kind of continue to develop it?

Yes. I mean, we feel really good about that molecule. The performance has been quite impressive. We've spent a lot of time trying to understand the differences between the doses, and in terms of tolerability profile. Our goal has and continues to be to try to identify the most tolerable regimen to make sure we have the most tolerable BTK inhibitor. So we're working hard on that. In terms of the Phase 3 program, the registration, we've got a few good opportunities. We haven't picked the one yet. But I would expect by early next year, we'll be in a Phase 3 for TG-1701.

Okay, very good. And then, I guess last week, just a little follow-up on, I think it was Ed's question with respect to autoimmune indications, additional autoimmune indications for ublituximab? What -- beyond MS, what's your current thinking in terms of where you're going to bring the product next?

Yes. We haven't given any guidance on that yet, Matt, but we're scoping out a number of different opportunities. And as soon as we have some in place, we'll certainly disclose those.

Congrats on the recent progress. And thanks for taking the questions.

Thanks, Matt.

Thank you. Our final question is from the line of Mayank Mamtani with B. Riley Securities. Please proceed with your questions.

Good morning, team. Thanks for taking our questions. And appreciate the helpful detail here. So just quick one, Adam, on the UKONIQ launch, any early color on what the real-world discontinuation and maybe progression rate might be just to -- I know it's early days, but just to get a handle on what the duration of therapy might be? And then I have a couple of quick follow-ups.

Yes. Thanks for the question, Mayank. No, you know it's -- I think it's too early honestly, to comment on that. We're -- yes, it's just too early to comment on that.

Okay, great. And then, Mike, on the near and long-term guidance, that was very helpful. Any color on the path to profitability, number one? And then also on the 2025 number for sales, does that include a partner for MS sales?

It does not include a partner for MS sales. And in terms of a path to profitability, again, I think if we achieve our goal of 2025, $1 billion in sales, my guess is we'll -- we should be profitable by then.

Okay, great. And just on the pipeline side, anything next we should expect to hear for the CD19, CD47 and maybe a program you don't talk about much, but IRAK4 is of increasing interest to investors, so just when and what we may expect to hear on those two programs, if you may?

Yes. So in terms of IRAK4, we've been pretty clear that that program is probably not moving forward for some time now. In terms of the CD47, CD19, that one is moving forward nicely. We've just opened up the US, and hopefully, like I said to have data later this year, if not later this year, then into next year.

Okay, thanks. Thanks, Mike. And congrats, again, on the progress.

Thank you.

Thank you. We have reached the end of the question and answer session. And I'll now turn the call over to Mike Weiss for closing remarks.

Great. Thank you very much. And thanks, everyone, again. So just want to wrap up today's call by once again review our upcoming key goals and objectives. So clearly we're going to continue to focus on the commercialization efforts of UKONIQ and relapsed refractory marginal zone and follicular and expand those commercial capabilities in preparation for potential launch in -- of U2 and CLL and also, of course, for ublituximab in relapsing forms of MS. We are working hard towards submitting our BLA for ublituximab in the treatment of option forms of MS in this quarter. And then, of course, as everyone knows, is based on the positive results from the ULTIMATE 1 and 2 Phase 3 trials. In terms of continued enrollment into the study, is obviously, we're going to push hard on the enrollment into the ULTRA-V Phase 3 trial, and enrollment into TG-1701 Phase 2 and hopefully soon to start TG-1701 Phase 3 trial early next year. And continue to push forward with the pipeline of TG-1501, which is the PD-L1 and TG-1801, the CD47, CD19. We've talked at length today about the potential data presentations for later this year. And we are working hard -- I could tell you, we're working very hard to obtain the approval for U2 and CLL by the PDUFA goal date of March 25, 2022. So on behalf of all of us at TG, I'd like to thank everyone for joining us today and have a great day.

Thank you to everyone joining us today. This will conclude today's conference. You may disconnect your lines at this time. Thank you for your participation.