…Relations for Vertex. Making prepared remarks on the call tonight, we have Dr. Reshma Kewalramani, Vertex's CEO and President; Stuart Arbuckle, Chief Commercial Officer; and Charlie Wagner, Chief Financial Officer. Dr. David Altshuler, Chief Scientific Officer, and Bastiano Sanna, Chief of Cell and Genetic Therapies will join the Q&A portion of the call following the prepared remarks.

I'll begin this evening's call with comments on our 2020 performance, and then turn to the pipeline, including an overview of a number of our R&D programs, and upcoming milestones. 2020 was an unprecedented year for governments, businesses, and people around the globe. It was also a remarkable year for Vertex. Despite the challenges we all faced against the backdrop of the pandemic, Vertex delivered extraordinary commercial performance generating $6.2 billion in product revenues, representing more than 50% growth compared to 2019. We also meaningfully advanced the pipeline and significantly strengthened our financial position. Vertex has discovered and developed medicines that have transformed the treatment of cystic fibrosis, and the latest of these TRIKAFTA or KAFTRIO, as it’s known in the EU, has the potential to treat up to 90% of patients with cystic fibrosis. In 2020, the first full year after TRIKAFTA approval in the U.S., the number of patients with CF treated with our medicines increased substantially. And by the end of the year, the vast majority of eligible patients, 12 years and older in the U.S., were on TRIKAFTA. In Q3, we received early approval for KAFTRIO in the EU and also secured reimbursement in England. By the end of the year, with direct access at marketing authorization in Germany, portfolio agreements in Ireland and Denmark, and the reimbursement deal in the UK, thousands of patients across the EU gained access to KAFTRIO. In terms of next steps in CF, we have line of sight to continued significant growth as we expand access to the triple combination to more patients in the EU, secure approvals in new geographies, as well as extend treatment to patients with rare mutations and younger populations, starting with the 6-to-11-year old’s in the U.S. We're also advancing additional small molecule combination regimens and other approaches that will further define our long-term leadership in CF. Our goal remains to bring transformative therapies to all people with this disease.

Thank you, Reshma. I'm pleased to review with you our continued strong commercial performance. Our Q4 global revenues were $1.6 billion, with full year revenues of $6.2 billion. This reflects significant growth over 2019 as we launched TRIKAFTA and KAFTRIO in the U.S. and EU respectively. As expected, in addition to considerable continued U.S. demand for our medicines, we saw a significant increase in revenues from outside the U.S. in the fourth quarter, following the approval and launch of KAFTRIO. Starting in the U.S. It is now well over a year since the launch of TRIKAFTA. And we have made tremendous progress in bringing TRIKAFTA to nearly all eligible patients, 12 and older, as reflected in our Q4 revenues. In 2021, our commercial focus now turns to maintaining the very high rates of persistence and compliance that we have seen to date, and we anticipate that these rates will normalize over the coming months. We expect the majority of near-term growth for TRIKAFTA in the U.S. to come from approvals in rare mutations and younger age groups. TRIKAFTA was recently approved for patients 12 and older with rare mutations, and the FDA recently accepted the sNDA for 6 to 11 year olds and granted it priority review. We expect an approval around midyear. In Europe, enthusiasm and interest in KAFTRIO amongst the CF community is high. Our fourth quarter revenues reflect substantial uptake of KAFTRIO across all countries where patients have access, most notably in the larger markets of Germany and England, where the majority of eligible patients have already been initiated. We are seeing similar uptake in other countries where we have secured reimbursement agreements, including Ireland, Scotland, Wales and Denmark. We remain focused on continuing the launch in these countries, as well as completing new reimbursement agreements to provide all eligible patients across the EU with access to our medicines. We have high confidence that as was the case in the U.S., ultimately, the vast majority of CF patients in the EU will be treated with KAFTRIO. However, while the destination is the same, the journey to get there will be different. In addition to the time and work required to secure new reimbursement agreements, the COVID-19 pandemic also presents significant uncertainties around the rate of uptake for our medicines. We are conducting fully virtual launches in the EU amidst evolving country level COVID lockdowns. The ability of patients to attend in-person consultations with their physicians, as the pandemic continues, is a dynamic we are monitoring closely.

Thanks Stuart. In the fourth quarter of 2020, we continued our exceptionally strong financial performance. And of note, Q4 was our first quarter with more than $1 billion of sales for the triple combination, a significant accomplishment for the commercial team. Fourth quarter total product revenues were $1.6 billion, a 29% increase compared to 2019, bringing our full year revenues to $6.2 billion, an increase of more than 50% compared to 2019 revenues of $4 billion. Our fourth quarter revenues included $1.21 billion in the U.S. and $421 million in revenues outside the U.S. Our ex-U.S. revenues for the quarter grew 70% over the prior year, driven by the uptake of KAFTRIO and our other medicines following the completion of several reimbursement agreements over the last year. Our fourth quarter 2020 combined R&D and SG&A expenses were $539 million, compared to $496 million for the fourth quarter of 2019. And our full year expenses were $1.98 billion, compared to $1.69 billion in 2019. Our full year expenses reflected increased cost to support the rapid global expansion of our CF business as well as targeted investment in expanding our pipeline into new disease areas and progressing our high priority clinical programs.

Thanks, Charlie. 2020 was an unprecedented and grueling year for the entire world. And while these challenges have not yet subsided, I have confidence that science will lead the way out of the pandemic and we look forward with optimism. Throughout the past year, Vertex has demonstrated our resilience in the face of these challenges, and this was reflected in our business performance and pipeline progress. Vertex has a proven track record of creating breakthrough medicines and transforming lives. We have an ambition to transform many more diseases, and our pipeline of small molecules, cell and genetic therapies are poised to do just that. Thanks. And we'll now open the call to questions.

Thank you. Our first question comes from the line of Cory Kasimov with J.P. Morgan.

Hey. Good afternoon, guys. Thank you for taking my questions. Two of them for you. On the AAT program, has the IDMC been taking regular looks at the 864 safety database, and would you characterize this as a situation where no news is good news on the safety front or is that still premature where you are in enrollment? And then also on this program, what's the -- in terms of relative levels of functional serum AAT, what would give you conviction that you're on to something here and provide added confidence going into the next stage of development? Thank you.

Hey Cory, this is Reshma. Let me take both of those questions for you. The AATD program is indeed followed very carefully as we do all of our programs, honestly, from a safety perspective, and that is just part of what we do. So, that is ongoing. With regard to levels and maybe broadly speaking, what are we really looking for from this VX-864 Phase 2 proof-of-concept study, really three things. The first is safety. This is the first time that VX-864 is going to patients with AATD. The second is PK and exposure, and the third is increases in functional AAT levels. I'm also going to be looking to see if there is a dose effect relationship. The key here, remember, is that this is our first time to close the loop on cracking the biology. That's to say, if we see levels of functional AAT increase in this study, we see a dose effect, what that tells us is that the mechanism that we projected to be the mechanism that could target both lung and liver raise AAT levels, we got it. And as I always say, we divide drug development at Vertex into two parts, cracking the biology, pouring on the chemistry. Pouring on the chemistry is the easier. It is not easy, but it's the easier of the two parts. And so, that's what we're really looking for is assessment of safety, PK, and we're looking for elevations of functional AAT levels.

Thank you. Our next question comes from the line of Salveen Richter with Goldman Sachs.

So, one question here on the CF guidance. Could you just comment on how you're accounting for uncertainty related to the pandemic? And what reimbursement agreements or approvals could be expected this year that are not accounted for? And then, secondly, you made a comment about your BD strategy, and I recognize while it's aligned with R&D, but at the same time is there any clarity you can give us with regard to areas of focus, size of deals, and how much of an interest do you have in technologies as you look to kind of fill your tool box there?

Sure. Salveen, this is Reshma. Why don't I start us off with the second part of your question, and then I'm going to ask Stuart to just comment a little bit more on the launch dynamics in the EU and a little bit more about the U.S. I think that will cover your question on CF. So, Salveen, with regard to BD, what we're really talking about here is an interest that is exactly the same as the strategy we've laid out for many years, probably the last eight years now. We are interested in assets that complement our internal efforts in CF. We're interested in assets that fit our R&D strategy. And you know, our R&D strategy is very, very diligent. We are very serious about the causal human biology and biomarkers and transformative potential, specialty markets. It has to fit all of that. And we're looking for tools that fit our toolkit. We've transacted in these areas. A lot of the recent transactions like Affinia and Skyhawk and Ribometrix fit those tools, and you should expect to see us continue doing that. We've also transacted on -- I think Semma is a great example. It's a good one to talk about today given the clearance of the IND. Acquisitions like Semma that fit our R&D strategy like a glove and those that have transformative potential. And if you're thinking about, okay, what kind of falls in and what falls out, you can think back to a slide we showed at J.P. Morgan with our funnel, if you will, that goes through our criteria, certain diseases fall in. Clearly, things like CF and AATD and APOL1-mediated kidney disease, but other examples of diseases that fall in would be Huntington's Disease, would be polycystic kidney disease. And then, there are diseases that fall out because they don't fit our criteria, criteria like specialty markets or understanding of causal human biology or having biomarkers that translate well. Stuart, I'm going to turn it over to you to tell us a little bit about the CF market.

Yes. Thanks, Reshma. So, Salveen, just I'm going to break down what's incorporated into our guidance into U.S. and ex-U.S. and talk about what the drivers of growth are. So, in the U.S., as you know, the vast majority of eligible patients across all patient groups have been initiated on TRIKAFTA in the U.S. during the course of 2020. And so, incorporated in our guidance is the kind of the annualized effect of those patients having been initiated, offset to some degree by persistence and compliance, which we expect to normalize during the course of 2021. In terms of growth drivers for the U.S., probably the most notable is the expected approval of TRIKAFTA for 6-to-11-year old’s, which we expect to happen in the midyear. Moving to ex-U.S. We have obviously launched the KAFTRIO triple combination in those markets where we do have reimbursement agreements, like the UK and Ireland and Denmark or markets where you can get early access, like Germany. And the majority of patients actually have already been initiated in those markets, the launch has gone very strongly. We do anticipate, obviously, initiating more patients in those countries. But, we have only included in our guidance, countries where we already have pricing and reimbursement agreements. So, to the last part of your question, which is where else would we be seeking pricing and reimbursement, the major countries in the EU where we were continuing to seek reimbursement are France, Spain, and Italy. Obviously, as Charlie said in his prepared remarks, it's impossible for us to predict exactly the timing of when we will reach those agreements. And for that reason, we don't include them in our guidance. Outside of the EU, obviously, the major countries are Australia and Canada. In both of those, we have filed for regulatory approval and are also in parallel seeking reimbursement approval as well. Again, those are not included within our guidance. And then, if I can just kind of turn to the longer term because obviously, 2021 is sort of one year in a long journey that we've been on. We continue to believe that we will be able to treat up to 90% of patients with CFTR modulators, like the triple combination, over time. That has for a long time been our goal and continues to be our goal, and we still feel very confident, if not more confident than ever that we're going to get there over time.

Your next question comes from the line of Phil Nadeau with Cowen.

I also had a follow-up on AAT and VX-864. I was curious whether the team has come to any further understanding of what tripped up VX-814 was -- or the issue of idiosyncratic to the molecule or class effect and maybe an extension of that. In the past, you had noted a difference in exposures between exposures between healthy volunteers and patients with AATD. In any way, could that be a sync effect because there's a lot of protein aggregating the liver? And if so, how could that be overcome?

Sure. This is Reshma. Let me answer those questions for you. I think, the best way to think about the AATD program is the following. We are very enthusiastic about the mechanism, because it's the only one that holds the potential to treat both, liver and lung. 814 was simply not the right molecule. And unsurprisingly, because the study was terminated early, we didn't fully enroll it, and patients who were enrolled didn't all complete the trial. There's not much more we can learn there. We are looking forward to VX-864 and those results. The study is enrolling. We are dosing patients, and we need to be a little bit more patient, but it's not that much longer now. We will have the results this half -- this first half of 2021.

Thank you. Our next question comes from the line of Michael Yee with Jefferies.

Hey, guys. Thanks, and congrats on a great quarter and great year to close out. I had two questions. One was on BD, maybe Reshma or the team, mid to late-stage can span a whole gamut of size and market cap and certainly, financial resource capacity. Vertex is a much bigger company now, much more cash, but mid and late-stage and different sizes can mean different things to different people. Can you maybe just comment about where Vertex's balance sheet or where you strategically feel comfortable along the range of sizes of what that can be, whether that's $5 billion, $10 billion, $15 billion? Maybe just think about that, which is the other side of doing a deal. And then, the second question, you made a nice comment about CF and how you're advancing the cycle there. I know there was a super corrector that had really high levels of chloride transport and there's also a once-daily potentiator. Can you just remind us where those are, and if those are still moving forward and doing well? Thank you.

Hi Michael, it's Reshma. Let me take the second question first, and then I'll come back around and talk a little bit more about BD. So, the once-a-day potentiator is VX-561. And you're right. We have been busy at work. David Altshuler, the team in San Diego have been busy at work with the development of more correctors. We have the combination of VX-121, let's call it, a next-gen corrector; VX-561, that's the once-a-day potentiator; and teza, that's made its way through Phase 2 development. And you'll remember, the agency asked us to also do a monotherapy study with VX-561. All of that's been completed. And what we're really doing now is looking at all of the data, planning forward to our regulatory interactions. And as soon as we get through all of those, we'll certainly give you an update on that program. Just remember, at a high level, drug development in CF going forward is going to be completely different than anything that's come before it because there is no placebo anymore. And so, don't be surprised if you don't hear from me on this program until we are through all of the conversations and we're ready to give you concrete next steps. But, I'm very pleased with how that's progressed. Okay, let's tackle BD. Let me take a couple of minutes and just really walk you through this in a little bit of detail. When I think about where we are in terms of the business today and where we're going, and then try to give you a little bit more color and texture behind capital allocation and BD, here's a way to put it all together. If you look at the Company three years ago, so back to January 2018. We were active in the clinic with…

Our next question comes from the line of Geoff Meacham with Bank of America.

I just two main ones. Charlie or Stuart, you guys recently updated your assumptions on the CF epidemiology. Can you address what data helped you -- helped lead you down that path? And whether this updated view of the CF market by patients is reflected in your 2021 outlook? And then, second question, Reshma, when you look at the pipeline and strategy, you guys have been obviously busy on the BD front, but essentially have maintained somewhat of a rare disease or specialized focus. I know, you've been reluctant to label yourself an orphan drug company, but is it fair to say that future BD could be similar, or as a bigger company, could you go after larger indications that share the same spirit of having transformational efficacy? Thank you.

I'm going to ask Stuart to comment on CF epidemiology first, and then I'll come back for your second question.

Thank Geoff, thanks for the question. So, as you noted and just to ground everybody, we recently updated our view on the epidemiology of CF in the U.S., Canada, Europe and Australia from 75,000 patients living with CF in those countries or regions to 83,000. And the reason that drove that change was really improvements in data quality and capture in the various registries and indeed some establishment of new registries in these regions. We periodically review all that data. And on our latest review, it was obvious to us that over the last few years, the epidemiology had increased. Just to answer a question you didn't ask, but one that we have been asked consistently is, was that increase concentrated in any one country, any one region? It really wasn't. It was really an across the board phenomenon. And something that's not uncommon as well in rare and orphan diseases is when you have really great transformative medicines, often you see increases in the number of eligible patients, and we believe that was also a factor here. In terms of whether that new epidemiology is included in our long-term -- our 2021 guidance. Absolutely, it is. That's the denominator that we are using now. And indeed, a number of those patients are already being treated with our CFTR modulators in the U.S., Canada, Australia and the EU.

Hey Geoff, it's Reshma. I'm really glad you asked the question about rare disease and orphan drugs. So, you know the reason I don't like calling us a rare disease company because we aren't a rare disease company. What we are is a company that is about specialty markets. And the best example I can give you of that is type 1 diabetes and our Semma acquisition. So, when you think about type 1 diabetes, it's well over 2 million people, right? So, far away from being a rare disease that suffer from type 1 diabetes. And the key there is that the Semma acquisition and the cell-based therapy holds the potential to be transformative. So, you're very correct, that is a key that we are looking for. And the type 1 diabetics are treated by endocrinologists, a specialty group. So really, the key for us is not rare disease, but specialty markets. And type 1 diabetes is the best example.

Our next question comes from the line of Mohit Bansal with Citigroup.

Couple of questions. One for Stuart, if you could help me understand that -- you did talk a little bit about new prevalence numbers for CF in these developed markets. But, when you look beyond these markets, likes of Latin America or even going as far as China, I understand the prevalence is lower there and incidence is lower on a population basis, but it's not zero. Do you still think about expansion opportunities outside of these core markets at this point? And, the second part is more on the R&D side. As you mentioned, so can you help us understand for VX-147 trial, how are you thinking about meaningful reduction in proteinuria there? Because these patients, if I understand correctly, they start at urine protein to creatinine ratio of 9 or 10 at sometimes?

Sure, sure. Stuart, do you want to start? And then, I'll take 147.

Yes. Mohit, so absolutely, you're right. The 83,000 patients living with CF is specific to the U.S., Canada, EU and Australia. But, in terms of other markets, we continue to believe that there are patients in other countries that we could serve. Indeed, we have established an affiliate in Brazil. And we are in the process of securing reimbursement for our medicines down there. The issue really with the epidemiology in some of these other countries is that it's much less robust, much less mature, and we have much less confidence in it than we do in some countries, like the U.S. and the EU, where the prevalence of the disease is much higher and there are much more established and longstanding registries. So, we continue to see opportunity to serve patients outside of those core markets, but those are the ones where we have a really, really good handle on the epidemiology.

And Mohit, about your question with regard to VX-147, to remind everyone, that's the small molecule that we are studying in Phase 2 proof-of-concept for FSGS, focal segmental glomerulosclerosis. You're right. It's a disease that is unfortunately unrelenting heavy proteinuria, usually in the nephrotic range, so more than 3 grams. And what happens to these patients is they either progress onto dialysis or to transplantation. We're looking here as we are for all of the programs, for a transformative effect. And to me, that would be double-digit protein reduction. As I said, for the AATD question with regard to what are we looking for from the Phase 2 study, safety, first time if you're going into patients; PK; and in this regard, proteinuria. And a double-digit decrease in proteinuria would be great to see and something that I'm going to be looking for. I'll remind everyone that we do expect the results from that study this year.

Our next question comes from the line of Paul Matteis with Stifel.

A couple of quick follow-ups. On the BD side, I know there has been a lot of discussion around potential indications or disease areas you're interested in. But, if you take a step back, you guys have your hands in gene therapy, editing, mRNA, a bunch of different tools. Are there any platform modalities that you don't have your hand in that are especially interesting to you? And then, on APOL1, one quick follow-up, Reshma. We did a few doc calls and the feedback was how you interpret the proteinuria data in part depends on the severity of the population and how heavily pretreated they've been by the standard of care. Is there anything you can tell us about the patients you're enrolling in this study? Thanks so much.

Yes. With regard to the patients that we're enrolling, these are patients with heavy proteinuria. There is some -- as you say, there is some background treatment that patients can be placed on, including steroids. But unfortunately, these treatments are not particularly effective. And even when you sometimes can see effect, the durability is often not there. So, we're studying heavy proteinurics, and that's what we're looking at. With regard to your question about tools for our toolkit and what do we have? We are really about transforming diseases. And when you are committed to transforming diseases, the key is to not let the tool be limiting. You know that a small minority of the protium can be impacted by small molecules, for example. And so, if we're going to target a disease and we can't get there by small molecules, we're certainly going to get there with one of the other modalities. And I'm going to ask David Altshuler just to give you a couple of words on mRNA therapies that we are working on, some of the collaborations we've done and give you a sense of where we are with our gene editing tools. David, do you want to make a couple of comments?

Sure. Thanks, Reshma. As you said, our strategy starts with the disease and we select a target which is validated as playing a causal role in the underlying biology of the disease. And then, we either invent or through partnership, we'll find the tools and technologies needed. In the case of CF, aiming for therapies to get at the last 10% of people who don't make a protein and won't benefit from our CFTR modulators, we collaborated with multiple companies, including Moderna, as you mentioned, for mRNA therapy. In other cases, we've identified a small molecule approach. But, we think that adding, for example, protein degradation technology, such as through our collaboration with Kymera or drugging RNA, I should say, as with our collaborations with Ribometrix or Skyhawk are the right way to approach those diseases. And you will continue to see us do deals and partnerships where there's a particular technology that opens up a target that we think has transformational potential, and we'll continue to do those as time goes on.

Thank you. Our next question comes from the line of Alethia Young with Cantor.

Hey guys. Thanks for taking my questions Congrats on all the progress. And I guess, I just want to talk a little bit about this, VX-880 IND. Can you talk a little bit more about kind of your clinical trial plans and designs, or how you kind of plan on navigating in light of COVID in that transplant population? Thanks.

Sure. Hey Alethia, thanks so much for the question. I'm really very enthusiastic about the VX-880 program. This is the cell-based therapy program for type 1 diabetes. It's actually pretty remarkable that we are at a point where we can now very seriously think about this therapy going to patients, and being on the brink of being able to see results. This is a disease and an approach and a clinical trial that I would think about like CTX001 in our CRISPR approach to beta-thal and sickle cell disease. It's a single-arm trial. The cell therapy product goes directly into patients. There is no healthy volunteer step. And I would say that in a reasonable number of patients, we're going to be able to tell what the performance of our therapy is, the out -- the measures that we are looking at, the outcomes are very straightforward, glucose, hemoglobin A1c, C-peptide level. And so, I think this is the brink of something very special, and I'm very eager to see this program progress.

Any impacts from COVID, do you think, or is it going to be pretty straightforward to navigate that?

Yes. COVID is something that is top of mind for all of our clinical trials for sure. But, that being said, this is an approach that is done in specialized centers, and I don't see us having a lot of challenge with it, if the COVID pandemic continues in this way, which is to say vaccines are coming, people have learned how to manage, and hospitals are able to continue to do clinical trial work, and so that part looks pretty good to me.

Our next question comes from the line of Gena Wang with Barclays.

Thank you for taking my question. I will also follow Alethia's question regarding 808. Just wondering, Reshma, any particular benefit goal -- benefit you want to achieve with say glucose or anything you can share with us that will lead to the next step for this program? And my second question is regarding the CTX001 for the complete --the trial -- currently the trial enrollment completion anticipating 2021, that's 45 patients each for beta-thalassemia sickle cell, could that be registration trial for the next step?

Okay. There are two questions, one about CTX001 and one about type 1 diabetes. Let me take the CTX001 question first, and then we'll come back around to type 1 diabetes. So, with CTX001, really remarkable, but you are correct. We are looking to complete enrollment in both trials, beta-thalassemia and sickle cell disease, and we're looking to do that in 2021. And yes, I do anticipate that the patients that we're studying in these trials that are ongoing will be the patients that constitute the regulatory package. As you've heard us talk about before, we've initiated those conversations, but we have not yet completed them. So, we're looking forward to doing so this year. But yes, I do expect these patients to be the composition of our filing package. On the VX-880 program and what are we looking for? So first things first. This is the first time that these fully differentiated, stem cell derived, insulin producing islet cells are going to patients. So, what we're really looking for is to get to our clinical trial sites with urgency. We're looking to get the cells dosed. We're evaluating safety. And the outcome measures are really fairly straightforward, C-peptide, glucose, hemoglobin A1c. And what we're looking for here is obviously to see an impact in terms of bringing down blood sugar and being able to see C-peptide levels drive an indication that there is insulin. It's a little too early to call exactly what the results will be and such. But, I am very excited that we're on the brink of enrolling patients and getting these trials up and running.

Our next question comes from the line of Brian Skorney with Baird.

Also sticking on the type 1 diabetes program, I was wondering if you can kind of help us understand how your program differs from sort of the historical islets cell transportation -- transplantation. I understand it comes from stem cells, but maybe kind of walk us through any engineering or process that goes into the derivation of the cell that ultimately gets transplanted and how you sort of plan to try to mitigate immunosuppressive effects? Thanks.

Yes. What a great question. And again, thanks so much for asking it. I guess, you must be hearing my enthusiasm just brimming over. So, the way I would think about the type 1 diabetes program is really two programs, and I would think of them as two separate programs. The first one, the one for which the IND just cleared, let's call that one the naked cell program. I would expect that there are maybe 60,000 people who could benefit from that naked cell program. That program does require immunosuppression. And the way I get to 60,000 is maybe there are 10,000, 15,000 people who have type 1 diabetes have end-stage renal disease because of their type 1 diabetes, and for that reason have had a renal transplant and are on immunosuppressive anyway, and then, maybe another 40,000 or so people with very brittle diabetes who would be comfortable with immunosuppression for the benefits that the cell therapy would bring them. Now, of course, the high fruit here is the cell plus device program. For that second program, we are in late preclinical development. The really important thing to know there is that the Semma team prior to acquisition, and one of the reasons we were so excited about the Semma team coming into Vertex is that they designed using the right material, the right geometry and a clear understanding of how to avoid the pitfalls of fibrosis, allowing oxygen to flow, allowing insulin and glucose to flow but not allowing the immune cells to attack the cell-based therapy. So, that program is particularly exciting because that does not require immunosuppressives. As we make progress on that program, we'll certainly keep you updated, but that is making its way through preclinical development, late preclinical development right now.

Our last question comes from the line of Liisa Bayko with Evercore ISI.

Hi there. I'm just going to jump on the bandwagon and ask a couple more questions on this note. Can you maybe speak to sort of how curable a pancreatic islet cell transplantation is today? What you think might be different with VX-880? And then, a little bit about durability, I understand it's quite durable. And then, just a final question on inventory. Were there any inventory build in Europe, let's say, given the recent launch of TRIKAFTA or anything like that to note? Thank you very much.

Hey there. This is Reshma. Well, I'll start with type 1 diabetes and keep on that theme, and then I'll ask Charlie to comment on inventory. Okay. So, the question that you asked is an excellent one, and it is how should we think about our cell-based therapy vis-à-vis what's been done with pancreas transplant or islets cell transplant. All right. So, maybe three or four key things to know. The most important, by far, in a way, the most important thing to know is this. We know exactly what causes type 1 diabetes. It's autoimmune destruction of the pancreatic islet cells. And, we know that when you can replace those cells, be it by whole pancreas transplant or islets cell transplants, you get benefit. So, we know those two things. What's the problem? Well, the problem is the quantity and quality of islet itself. That is actually the essence of the problem, not that we don't know that this will work. We know it will work. And the real seminal discovery here that the Semma team made, and that was so exciting to us is they developed a way to take stem cells differentiated, fully differentiated into insulin producing islet cells and make that in industrialized quantities. And so, now what we have is the quantity and quality of cells to give -- to transfuse, to transplant into patients with type 1 diabetes. So, that's really what the real discovery here has been and why this program is so exciting to us. Charlie, from that excitement to an inventory question that I'm going to ask you to address.

Yes. Thanks. And I'm going to take this opportunity actually to give a plug to our colleagues in the supply chain and manufacturing organization. I think, the most noteworthy comment I can make about inventory is that those teams have worked flawlessly throughout the pandemic to ensure that we have inventory available for our patients to ensure that we were ready for the KAFTRIO launch in Europe and to ensure that we'll be ready for future launches in 2021. I think your question of course is specifically about the impact on revenue. I could tell you that there was nothing noteworthy in the fourth quarter or in our 2021 guidance related to inventory levels.

Thank you. This concludes today's question-and-answer session. I will now turn the call back to Michael Partridge for closing remarks.

Thanks, operator. So, we're at the one hour mark. We will conclude the call here. I know there are other folks in the queue who didn't get a question, but the Investor Relations team is in the office tonight and happy to take your questions. And, thank you very much for connecting tonight.

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