Nuvation Bio (NUVB) Q3 2026 Earnings Call Transcript

DATE

Wednesday, Nov. 4, 2026

CALL PARTICIPANTS

• Vice President of Corporate Development and Investor Relations - J.R. DeVita
• Founder, President and Chief Executive Officer - Dr. David Hung
• Chief Commercial Officer - Colleen Sjogren
• Chief Financial Officer - Philippe Sauvage

TAKEAWAYS

• Total Revenue -- $45 million, reflecting a combination of IBTROZI product sales and collaboration revenue.
• Net U.S. IBTROZI Product Revenue -- $27.5 million, growing 18% sequentially from the previous quarter.
• Collaboration and License Revenue -- $17.5 million, driven by $7.7 million in milestone and royalty payments from ex-U.S. partnerships.
• New Patient Starts -- Approximately 160 patients initiated treatment, with 65% of those in the first-line setting.
• First-Line Market Share -- Greater than 60%, maintaining a leading position in new patient starts despite broader market softness.
• Total Active Patients -- Management reported IBTROZI is the leading ROS1 TKI across all lines of therapy combined based on IQVIA claims data.
• ROS1 TKI Market Volume -- 15% decline in total new patient starts across the broader market during the third quarter.
• Gross-to-Net Deductions -- Approximately 30%, which the company expects to remain stable as the payer mix matures.
• Cash and Marketable Securities -- $663.4 million as of Sept. 30, 2026, including proceeds from a convertible debt offering.
• Research and Development Expenses -- $32.7 million, primarily reflecting investments in the TRUST and safusidenib clinical programs.
• Selling, General, and Administrative Expenses -- $42.6 million, driven by costs associated with the commercialization of IBTROZI.
• Net Loss -- $41.9 million, or $0.12 per share, compared to a net loss of $55.8 million in the same period last year.
• Convertible Debt Offering -- $287.5 million in aggregate principal amount, following the full exercise of the overallotment option.
• TRUST-I Efficacy Metrics -- 90% objective response rate in TKI-naive patients, supported by 51 months of median patient follow-up.
• Safusidenib Phase II Results -- 52% centrally assessed objective response rate in chemotherapy and radiotherapy-naive Grade 2 IDH1-mutant glioma patients.
• Safusidenib 36-Month PFS Rate -- 79% in the J201 study, with the median progression-free survival not yet reached.
• European Approval Milestone -- $30 million, which would be triggered by a potential approval in the first half of 2027.
• Safusidenib Fast Track Designation -- Granted by the FDA in Aug. 2026 to facilitate development and expedite the review of the program.
• NGS Testing Rates -- 25% decline in laboratory data partner alerts during the quarter, reflecting overall market fluctuations.
• China and Japan Royalties -- $2.7 million for the quarter, following inclusion in China's National Reimbursement Drug List in Jan. 2026.

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RISKS

• Hung reported that IQVIA claims data showed a 15% decline in total new patient starts across the ROS1 TKI market, which the company attributed to quarter-to-quarter volatility in ultra-rare disease settings.
• Sjogren identified significant care gaps, noting "limited awareness that DNA-based testing alone may miss ROS1 fusions" and a trend of physicians initiating treatment before molecular results are available.
• Management noted that IBTROZI's pool of patients available to switch from earlier therapies has become smaller, meaning future growth will rely more heavily on newly diagnosed patients.

SUMMARY

Nuvation Bio Inc. (NYSE:NUVB) reported revenue growth for its primary oncology asset while expanding clinical investigations in neuro-oncology. Management stated that the company attained market leadership in total active ROS1-positive patients and maintained a majority share of new first-line patient starts. The company indicated that commercial results reflect the long-term durability of its lead product, which serves as a benchmark for physician treatment choices. Management noted that overall market volume for ROS1 TKIs experienced a quarterly pullback, which they attributed to the inherent volatility of ultra-rare disease populations. The company emphasized its strategic transition toward first-line patient accumulation and improved molecular testing adoption. Furthermore, the company reported progress in its glioma program, which recently received regulatory Fast Track status and is enrolling four separate clinical studies.

• Sjogren stated, "IBTROZI's durability is the benchmark against which other ROS1 therapies will be measured, especially given our mature patient follow-up."
• Management expects a potential European approval in the first half of 2027 to trigger a milestone payment and broaden the product's global commercial reach.
• The company is advancing two Phase II response-rate studies for safusidenib in Grade 3 oligodendroglioma and post-vorasidenib failure, which could provide data readouts in 2027.
• Sauvage stated, "IBTROZI is now on a quarterly revenue run rate related to launch-related expenses that represents a self-sustaining commercial program on a stand-alone basis."
• The company plans to provide a strategic update on its drug-drug conjugate platform by the end of the year to detail the program's transition into clinical development.
• Management reported that testing rates in China and Japan have exceeded internal expectations, contributing to stronger-than-anticipated royalty revenue from those regions.

INDUSTRY GLOSSARY

• IBTROZI: The brand name for taletrectinib, an oral ROS1 inhibitor used for advanced non-small cell lung cancer.
• ROS1: A gene that can fuse with other genes to drive the development of certain lung cancers.
• TKI: Tyrosine Kinase Inhibitor; a targeted therapy that blocks enzymes involved in cell signaling and growth.
• Glioma: A primary brain tumor that originates from glial cells.
• IDH1: Isocitrate dehydrogenase 1; a gene that, when mutated, is a primary driver in many types of brain tumors.
• CNS: Central Nervous System, referring to the brain and spinal cord.
• DDC: Drug-drug conjugate; a therapeutic platform designed to deliver targeted medication directly to cancer cells.
• ORR: Objective Response Rate; the percentage of patients whose cancer shrinks or disappears after treatment.
• PFS: Progression-Free Survival; the length of time during and after treatment that a patient lives with the disease without it worsening.
• DOR: Duration of Response; the time a tumor continues to respond to treatment before progressing.

Full Conference Call Transcript

Operator: Hello, and welcome to Nuvation Bio's Third Quarter 2026 Financial Results and Business Update Call. Today's call is being recorded, and a replay will be available on the company's website. [Operator Instructions] Now I'd like to turn the call over to J.R. DeVita, Vice President of Corporate Development and Investor Relations at Nuvation Bio. Please go ahead.

Robert DeVita: Thank you, and good afternoon, everyone. Earlier today, we issued a press release summarizing our financial results for the quarter ending September 30, 2026, and provided a business update. The press release is available on the Investors section of our website at nuvationbio.com. Today's call includes forward-looking statements, including statements about the therapeutic and commercial potential of IBTROZI and safusidenib, our development plans for taletrectinib, safusidenib and our drug-drug conjugate platform, along with our plans for future updates from these programs, the components of our anticipated product revenue, our expected milestone payments and spending patterns and our cash runway and profitability potential.

Because such statements deal with future events and are subject to many risks and uncertainties, actual results may differ materially from those in the forward-looking statements. For a full discussion of these risks and uncertainties, please review our quarterly report on Form 10-Q, which we filed with the U.S. Securities and Exchange Commission today. Joining me on today's call are our Founder, President and Chief Executive Officer, Dr. David Hung; our Chief Commercial Officer, Colleen Sjogren; and our Chief Financial Officer, Philippe Sauvage. Now I'll turn the call over to Dr. David Hung. David, please go ahead.

David Hung: Thanks, J.R. Good afternoon, everyone, and thank you all for joining us. Today, I'm pleased to discuss the progress we made across our business in the third quarter. We generated $45 million in overall revenue, driven by another quarter of strong IBTROZI growth. Net U.S. IBTROZI product revenue was $27.5 million, which represented 18% growth from the last quarter. Approximately 160 new patients started treatment with IBTROZI, about 65% of which were in the first-line setting. The commercial signals that matter most to our long-term thesis remain encouraging. 15 months into our U.S. launch, we continue to both build a growing base of patients on therapy and strengthen our position in the ROS1 market.

IBTROZI has reached an all-time high in its share of active patients receiving a ROS1 TKI and continues to lead in first-line new patient starts with greater than 60% market share as of the end of the quarter. Our revenue growth reflects an expanding active treatment base driven by an increasing proportion of first-line patients that we believe can stay on therapy for years as seen in our TRUST clinical studies. IQVIA claims data from the third quarter demonstrated a 15% decline in total new patient starts across the ROS1 TKI market. This is further evidenced by a lower volume of ROS1 positive testing alerts from our laboratory data partners.

We believe these observations suggest that at least part of the softness in our first-line new patient starts is a reflection of the overall flow of newly identified and treated patients rather than a loss of IBTROZI's competitive position. Despite the market dynamics described, as of the end of the quarter, we maintained our strong position as the leading ROS1 TKI in total active patients across all lines of therapy combined. ROS1-positive lung cancer is an ultra-rare disease, and the number of new patients entering treatment can fluctuate from quarter to quarter. We do not believe one quarter provides sufficient data to establish an identifiable demand trend nor draw clear conclusions.

We are monitoring market activity and treatment patterns closely while maintaining our focus on the drivers we can influence, identifying patients earlier, educating physicians about appropriate testing, supporting biomarker-informed treatment decisions and increasing appropriate use of targeted therapy. We also are encouraged by how IBTROZI's launch compares with historical targeted lung cancer launches, particularly given the small ROS1 population and fragmented prescriber base. While we realize comparisons are nuanced due to differences in size of patient populations, cost of therapy and initially approved lines of therapy, we believe this is helpful to put IBTROZI's launch in context.

For example, 5 full quarters into the launches of LORBRENA and ALECENSA for ALK-positive lung cancer, U.S. net revenues per SEC filings and financial reports were $25 million and $36 million, respectively. As you know, IBTROZI has already reached similar levels of sales in a more competitive market despite ROS1 incidence being approximately half that of ALK. It is key to remember that the ALK-positive lung cancer market was not developed overnight. It took time for testing patterns, physician confidence, durability on treatment and long-term data to align behind the agents that ultimately became market leaders today. Most fundamentally, our confidence begins with the clinical profile.

In TKI-naive patients in TRUST-I, IBTROZI demonstrated a 90% objective response rate or ORR, 50 months of median duration of response or DOR and 50 months of median progression-free survival or PFS. Its tolerability profile, including the unique absence of a CNS warning and precaution in the label, is another critical point of differentiation among brain-penetrant ROS1 TKIs. And remember, these metrics are supported by median patient follow-up of 51 months in the TRUST-I study. We believe these attributes can support physician confidence, sustained first-line adoption and meaningful time on therapy.

This clinical profile is also one of the reasons we chose to develop IBTROZI in the adjuvant setting, where we're encouraged that enrollment is fully on track in this first-of-its-kind study for ROS1. If approved, this indication could expand the patient population IBTROZI is able to address and the data from Eli Lilly's LIBRETTO study in RET-positive non-small cell lung cancer has given us even more confidence that we could reach a meaningful result in ROS1 sooner than we initially thought. Taken together, the results reinforce our view that we are building a durable commercial franchise and that IBTROZI has become the standard of care in ROS1-positive lung cancer.

Quarterly new patient activity will not always move in a straight line, but our competitive positioning, growing active patient base and ability to reach more eligible patients provide a strong foundation for the years ahead. Moving to safusidenib. We remain very excited about this program and its potential to become a key value driver for Nuvation Bio as we move to 2027 and beyond. In August, the FDA granted Fast Track designation to safusidenib for the treatment of IDH1-mutant glioma. We view this as supportive external validation of both the unmet need in this disease and the potential development path for safusidenib.

Fast Track designation is intended to facilitate development and expedite review of therapies that may address serious conditions with unmet medical need, and we are pleased to have this designation as we continue to advance the program. As a reminder, in July, we announced updated long-term results from the Phase II J201 study in 27 patients with chemotherapy and radiotherapy naive Grade 2 IDH1-mutant glioma. With a median follow-up of 39 months, the centrally assessed ORR increased to 52% from 44% at 28 months of median follow-up. Median PFS had not yet been reached and the 36-month PFS rate was 79%. Responses in the study have continued to deepen and no new safety signals were observed with additional follow-up.

We will present more detailed data beyond these top line results at the Society for Neuro-Oncology Annual Meeting next week. As a result of this encouraging data set, we recently announced an enhanced development plan that allows us to address 2 key goals. First, our 4 studies together address all grades and risk groups within the broad IDH1 mutant glioma landscape. Second, 2 of these studies focus on patient groups with high unmet needs and no alternative treatment options and evaluate ORR as a primary endpoint, which will allow us to generate data quickly.

In fact, these 2 studies in patients with Grade 3 oligodendroglioma and in patients who have progressed following treatment with vorasidenib also analyzed tumor growth rate, or TGR, as a secondary endpoint, which may provide an even earlier signal of efficacy. This is a key difference from our other 2 pivotal randomized studies, which evaluate PFS as a primary endpoint and will not generate data until 2029 or later. As a reminder, these pivotal studies include SIGMA, which is evaluating safusidenib in patients with high-grade and high-risk astrocytoma and a separate study in patients with Grade 2 IDH1-mutant glioma.

Enrollment in the SIGMA study, including the exploratory cohort is on track, and we expect to be enrolling patients in all 4 studies in the coming months. We plan to provide more specific updates on enrollment and clarity around timing of data readouts next year. Finally, we also remain on track to provide an update on our drug-drug conjugate or DDC platform by the end of the year. This update will include additional detail on how we plan to move the program forward and into the clinic. We're excited by the progress of this program and look forward to sharing more information soon. Overall, the third quarter reinforced the long-term opportunity in front of us.

IBTROZI is now a commercial leader with a growing active patient base that is driven by an increasing number of new first-line patients and their long duration of treatment. Safusidenib continues to advance as a meaningful second franchise with potential data next year, and our DDC platform could contribute to future pipeline growth. With that, I'll turn the call over to Colleen to provide a more detailed update on IBTROZI's commercial launch.

Colleen Sjogren: Thank you, David, and good afternoon, everyone. IBTROZI continues to strengthen its leadership in the ROS1 market with a launch trajectory that stands out against historical benchmarks. Just 15 months after launch, we have achieved approximately twice the cumulative patient starts of earlier-generation ROS1 TKI launches at comparable points in their commercialization based on our internal data and adjusted claims estimates. This is particularly meaningful in an ultra-rare disease with a broad and fragmented prescriber base. We believe this performance is a testament to both IBTROZI's differentiated clinical profile and the strength of an experienced commercial team that knows how to successfully launch targeted oncology therapies.

In the third quarter, U.S. net product revenue grew 18% sequentially to approximately $27.5 million despite an observed decline of about 15% in new patient starts across the overall ROS1 TKI market. This quarterly decline was observed in 2 distinct data sets, IQVIA data and the number of ROS1 NGS testing alerts from our contracted lab partners. This is the kind of fluctuation sometimes observed in ultra-rare disease, and we do not believe is indicative of any trend. In fact, it builds confidence that we continue to grow our active patient base and our sales in a down market. This growth was broad-based across treatment settings, reflecting deepening physician confidence, expanding adoption and sustained demand for IBTROZI.

Our commercial execution continues to translate into significant market leadership. And this quarter, we achieved an important milestone. IBTROZI is now the leading ROS1 TKI in total active patients across all lines of therapy combined. This is based on IQVIA claims data. This is not simply a measure of new patient starts. It represents our share of all patients actively receiving a ROS1 TKI, including those who have initiated therapy years ago on earlier generations of ROS1 TKIs. Having achieved this leadership position just over a year post approval in a market with established therapies is particularly significant and reinforces both the strength of IBTROZI's clinical profile and the success of our commercial execution.

We are also continuing to strengthen our first-line position. We established IBTROZI as the market leader in total active first-line patients through the end of the quarter. And today, our share of first-line new patient starts is more than 60%. As David discussed, IBTROZI's compelling efficacy, exceptional durability and generally favorable tolerability profile continue to differentiate it in the first-line setting. Based on multiple advisory board meetings and one-on-one engagements, physicians continue to point to the strength of our clinical data, supporting our belief that IBTROZI's durability is the benchmark against which other ROS1 therapies will be measured, especially given our mature patient follow-up.

While our TRUST clinical studies were much longer than IBTROZI's time in the market, to date, we have observed a clear similarity between duration of therapy in the real world and durability in our clinical trials. This is further evidence of why we believe IBTROZI can benefit patients for years. As the launch continues to mature, we are seeing a natural evolution in the ROS1 patient population. At launch, there was a pool of patients receiving earlier generation ROS1 inhibitors, who were candidates to switch therapies due to disease progression or tolerability. We have successfully captured many of these patients.

As a result, the pool of patients immediately available to switch has become smaller and future growth will increasingly be driven by newly diagnosed patients. We believe this dynamic, combined with our entrenched commercial leadership, provides a strong foundation for sustained long-term growth. And while new treatment options are entering the market, our leadership remains strong as IBTROZI continues to be the only brain-penetrant treatment option without a CNS warning and precaution in its label. To date, we have not observed a material impact on IBTROZI's overall active patient share with recent market entrants, and our data suggests that early uptake of a new competitor is largely concentrated in later lines of therapy with no off-label use in TKI-naive patients.

Beyond our growing market leadership, we are also encouraged by the opportunity to expand the overall ROS1 TKI market. Claims data show that the number of patients actively receiving a ROS1 TKI increased materially year-over-year following IBTROZI's launch, even with a market pullback this past quarter. We believe this growth demonstrates the potential to expand the population receiving a ROS1 TKI. And we see an even more substantial opportunity ahead through earlier identification of ROS1 fusions and increased adoption of targeted therapies in place of chemotherapy with or without immunotherapy. However, we see 2 key barriers remaining along the testing to treatment journey. First, limited awareness that DNA-based testing alone may miss ROS1 fusions.

And second, the urgency to initiate treatment before molecular testing results are available, potentially leading patients to receive chemotherapy or immunotherapy instead of a targeted therapy. We have focused commercial initiatives underway to help drive the shift in testing and treatment decision behavior, which we believe are key sources of long-term growth for IBTROZI. For example, through our quality-based initiatives, we are addressing critical gaps in patient care, from significantly improving NGS testing rates at key community oncology practices to ensuring patients receive optimal care with appropriate targeted therapies. We are also assessing testing lab alert data to prioritize relevant physician outreach and advancing network collaborations to strengthen molecular testing and treatment decisions.

Additionally, we are also investing in field training, coordinated omnichannel marketing and AI-enabled approaches to make HCP engagements more targeted and timely. We know this may take time, but patients deserve it. And our focus is always on increasing the rate of diagnosis and displacing inadequate treatment options. At the institutional level, we continue to strengthen access and pathway positioning. For example, one major community pathway recently reinforced the position of IBTROZI as its primary first and second-line ROS1 TKI treatment choice. Along with focused contracting initiatives and tailored strategies across academic centers, IDNs and community practices, this reduces practical barriers to access.

These efforts require close appropriate coordination among sales, market access, marketing and medical, and I'm incredibly proud of how our experienced teams are executing cross-functionally. What gives me confidence in the long-term success of IBTROZI is the combination of strong clinical differentiation, an established and growing market position and a commercial team that understands both the opportunities and the work required to capture them. We have built a strong foundation over the first 15 months, and we remain focused on translating that leadership into sustainable long-term growth and bringing the potential benefits of IBTROZI to more appropriate patients. With that, I'm going to turn the call over to Philippe.

Philippe Sauvage: Thanks, Colleen, and good afternoon, everyone. For detailed third quarter 2026 financial results, please refer to our earnings press release, which is available on our website. I will highlight a few key points from the quarter. For the third quarter of 2026, total revenue was $45 million, including $27.5 million in IBTROZI net U.S. product revenue and $17.5 million in collaboration and license revenue. For the first 9 months of 2026, we generated $159.9 million in total revenue. This included $69.2 million in IBTROZI net U.S. product revenue and $90.7 million in collaboration and license revenue. The commercial dynamics David and Colleen discussed are consistent with our view of how this market will and will develop as behaviors change.

The later-line pretreated ROS1 population represented an important but finite opportunity early in the launch. The long-term growth driver now becomes first-line adoption and the accumulation of patients who can remain on therapy for multiple years. David mentioned the trajectory of precedent launches in the ALK-positive lung cancer space. These precedents tell us a few things. First and foremost, that IBTROZI's launch is in line with prior rare lung oncology launches on a population-adjusted basis, but also that it takes time for the first-line patients on therapy to build a durable revenue base. This is why we continue to be excited by IBTROZI's potential. Our access strategy continues to be effective. Gross-to-net deductions were approximately 30% in the third quarter.

We expect gross to net to remain generally stable as our payer mix and contracting mature. The remainder of our revenue was generated through collaboration and license agreements. We continue to receive royalty revenue from Innovent Biologics in China and Nippon Kayaku in Japan. The China and Japan launches are progressing ahead of our expectations, and we continue to view our ex-U.S. partnerships as a growing component of the broader IBTROZI opportunity. In fact, $7.7 million of our total revenue for the quarter was driven by milestone and royalty payments from these partnerships. We are also working closely with Eisai, our partner for Europe and other select territories.

We expect potential approval in Europe in the first half of next year, which will trigger an approximately $30 million milestone payment to Nuvation Bio. On the expense side, we continue to invest in the business and our programs, resulting in total operating expenses of $75.2 million for the quarter. R&D expenses were $32.7 million for the quarter and $98.4 million for the first 9 months of 2026, primarily reflecting investments in the TRUST and safusidenib clinical development programs as well as preparation for future development activities. SG&A expenses were $42.6 million for the quarter and $123.5 million for the first 9 months of 2026, primarily driven by support for the commercialization of IBTROZI.

While we always expect small quarter-on-quarter fluctuations in our spend, we do not expect material changes to our general spending patterns for the remainder of the year as the rise of R&D spend on safusidenib is compensated by gradual reduction of the spend on the TRUST program over time. It is also exciting to highlight that for the first time, IBTROZI is now on a quarterly revenue run rate related to launch-related expenses that represents a self-sustaining commercial program on a stand-alone basis. Our goal has always been for IBTROZI to be a driver of future profitability, and we view this as a first step on the journey of IBTROZI being able to finance all of our spending activity.

Turning to the balance sheet. We had cash, cash equivalents and marketable securities of $663.4 million as of September 30, 2026, which now includes all proceeds from our convertible debt offering in December. This solid cash position gives us the confidence to continue investing in our future, driven by our pipeline of exciting assets. Importantly, our approach to capital allocation has not changed. We remain disciplined. We will continue investing behind IBTROZI, advancing safusidenib and progressing our DDC platform from a position of strength. We also continue to evaluate business development opportunities only where we see the potential to generate compelling returns and create long-term shareholder value.

Based on our internal revenue projection and the current operating plan for all of our programs, we continue to believe we have sufficient capital to reach profitability. I'll now turn it back to David for closing remarks.

David Hung: Thanks, Philippe. This quarter reinforces what we are building at Nuvation Bio, a commercial program with the potential to redefine the treatment of advanced ROS1-positive lung cancer, a second program that continues to gain momentum in IDH1-mutant glioma and a pipeline platform that we believe can support future growth. We recognize that changing treatment behavior in targeted oncology takes time, but we are confident in the fundamentals. IBTROZI has a differentiated label, a growing active patient base and the durability and tolerability profile we believe are necessary to support long-term adoption. At the same time, safusidenib is advancing through a comprehensive development plan in an area of significant unmet need.

I am proud of the progress our team continues to make and grateful to our employees, investigators, partners and shareholders and to the patients and families who place their trust in us. I'll now ask the operator to open the line for questions.

Operator: [Operator Instructions] Your first question comes from the line of Farzin Haque with Jefferies.

Farzin Haque: First on glioma. Are you providing any color on the enrollment for the 2 cohorts, the oligodendroglioma and the post-Vora patients? And when we could potentially get the ORR readout in 2027?

David Hung: Farzin, we haven't yet provided color on that, but we will probably be doing that in the future time.

Farzin Haque: Got it. And then on IBTROZI, the October sales are looking in line with prior months. But with the new patient starts holding up and the first-line patient base is accumulating, how should we think about the 4Q revenues despite the broader ROS1 market decline that you're seeing? Is $108 million consensus the right area to think about for the year?

David Hung: Yes. I think there's lumpiness in this last quarter. So I think that we don't really look at that as a trend of any sort. So we anticipate growth continuing at around the same clip as we've seen in the past.

Operator: Your next question comes from the line of Gregory Renza with Truist Securities.

Anish Nikhanj: It's Anish on for Greg. Congrats on the progress this quarter and for taking our question. We wanted to know within the first-line opportunity, how are you seeing IBTROZI compete with repotrectinib? And what is driving physician choice? And is the bigger remaining opportunity taking share from other TKIs or earlier ROS1 testing and conversion from chemo/IO?

David Hung: Okay. Well, that's a lot of questions. But I think we're doing very well against repo. As you know, we are not only a market leader, but we are also -- in the first year of our launch, we've sold twice as much drug as all other ROS1 agents combined. So we've done extremely well against our competitors. We think the market is going to grow by a couple of ways. #1, we do believe that we will take share from other TKIs given if you look at our efficacy, which has not been matched, our safety profile, as we mentioned, we are the only ROS1 TKI that penetrates the brain that does not have a CNS warnings and precaution.

So that's unique. So we think we will continue to take market share from other TKIs. But we also do think that we will grow the market because good drugs grow markets. And we saw that happening with ALK. We saw that with EGFR, and we think that's going to happen in ROS1. We do anticipate increasing testing for ROS1, but we also anticipate other changes in practice that are now supported by NCCN guidelines, namely, reduction of IO chemo use and using a precision ROS1 TKI for a precision mutation like ROS1. So we do think that, that will continue to grow the market. Colleen?

Colleen Sjogren: Yes. I want to add on to that, too. Thanks for the question. It's a good one. So when you look at IBTROZI right now, what is really remarkable looking at the team's achievement, IBTROZI right now has the largest number of patients actively receiving a ROS1 TKI. Now that's across all lines of therapy combined. And to your question, that's including patients who started in prior periods on therapies available for years. So this is distinct just from being #1 in new start. So reaching this position in just 15 months after launch, that reflects both new patient adoption and patients continuing treatment. So we think that's really important.

And I'd like to just address quickly what you said about testing. We see this as one of the most meaningful opportunities. So when we look at the 2 care gaps that matter most, we're looking at this idea that DNA-only testing can definitely miss some of these ROS1 fusions. And then the other part of it is these treatment decisions beginning sometimes before molecular testing results are even back and available. So we're hyper focused on improving comprehensive testing, and that's including appropriate RNA-based methods. We're also very focused on helping practices incorporate molecular results into their treatment decisions. So these changes do take time. We know that.

This team has been in ultra-rare disease before, but they definitely can improve care and expand the appropriate targeted treatment for these patients.

David Hung: And I want to add one more comment to Colleen's comments. So if you look at the duration of response in the first-line setting for IBTROZI, it's 50 months. That's -- if you look at repotrectinib, their DOR story is around 36 months. So that's a pretty significant difference in how long patients will be on a therapy. That contributes to more patients being on therapy. But on top of that, I mentioned that we are the only ROS1 TKI without CNS warnings and precautions. If you look at our median time of follow-up with IBTROZI's data so far, it's 51 months. We're not talking about 14 months of follow-up.

We've had well over 4 years of follow-up, and you know that adverse events accumulate with time. In spite of a 51-month follow-up, we have right now, no CNS warnings and precautions in our label. We have a very, very low incidence of adverse events. We think that, that, combined with the efficacy leads to a growing pool of patients on therapy, which will contribute to the revenue stacking that we've talked about from day 1. So we do think that a number of patients on IBTROZI will continue to grow, especially because of our long duration of response and our really excellent tolerability.

Operator: Your next question comes from the line of Geoff Meacham with Citi.

Geoffrey Meacham: Congrats on the quarter. I had a couple of questions. One for IBTROZI. Maybe just it would be helpful to walk through in the U.S., the nuances between the community and academic setting. Are there any differences there? And then as your partners prepare for a launch in China and in Japan, in that market, are there anything that -- anything you would call out as differences that may help the launch and adoption? I'm just trying to think of the comparisons to the U.S. And then I have a follow-up on safu?

David Hung: Sure. So in the community, we do see lower rates of testing than in many academic centers. So I think that will improve over time. But I would say that community is still not getting as much testing done as academicians are. On top of that, we do think that there is probably more IO chemo use in the community setting than there is in academia. So I think those are 2 of the most important differences. When we look at China and Japan, those launches have actually exceeded our expectations. And part of that is because testing is actually remarkably high in China and Japan.

And in China, you get in trouble for not ordering NGS on a lung cancer patient in 2026. I wish I could say that for the U.S. That's not the case. But I would say that the testing rates in China and Japan are excellent and probably contribute to the reason that those launches have actually exceeded our expectations.

Geoffrey Meacham: Okay. And then just on safu with the expansion of the SIGMA study, maybe just talk a little bit about what that means for the standard of care across the different European countries. I'm just trying to think of variations in the standard of care among the different new European countries and what that could do to some of your comps or maybe enrollment kind of time lines?

David Hung: I don't think it's going to really change among the countries. The things that all the patients have to have failed to get on to the SIGMA study are all pretty standard. I don't think that's going to contribute to any real variation. I think that this is a pretty uniform patient population. We anticipate it being pretty standard across all the countries. We are trying to find countries where there are different standards of care in which Vora is not available to do a study against placebo because that's not possible in countries that do have Vora.

But I would say for the SIGMA countries, the standards of care are pretty standardized across all of them, and we don't anticipate any real problems from a clinical trial standpoint.

Operator: Your next question comes from the line of Li Watsek with Cantor Fitzgerald.

Li Wang Watsek: Maybe just on safu readout, which of the endpoints could we potentially get in 2027? And what would be impressive outcomes either in the oligo or post Vora settings? And then on IBTROZI, just wondering what the reason might be behind the sequential decline of the new patient starts for the overall market?

David Hung: Okay. Let me answer your first question first. So with regard to safu readout, we previously said that we expect at least 20 patients to be enrolled this year in the Grade 3 oligodendroglioma study. So that means by June of 2027, we will have somewhere between 6- and 9-month follow-up on at least those 20 patients or more -- will be enrolled more than that. So in general, if you look at how long it takes to get a response on safusidenib, we would say those response we see are generally in the range of -- between 6 months and 12 months. So we would expect a number of those patients to have objective responses.

We are also initiating the post-vorasidenib study. This study is different because there are a lot of patients now who can be put on vorasidenib in the thousands. And we know from the vorasidenib INDIGO data that about 1/4 of them progress on vorasidenib within about a year. So given the fact that vora is now pushing almost 2 years since launch, we would expect there to be well over 1,000 patients that would be available that will be progressing on vora. And we believe that it will be very easy to identify patients progressing on vora because they're progressing, clearly, the opportunity to see responses there is even greater.

We believe that the bar to beat is in the range of 20%. We know that -- we know from Chimerix as an example, their approval was based on 50 patients in their trial with 11 responses, about a 22% response rate. We know that other glioma trials have been in the range of about 70, 75 patients or so. So we think that somewhere in the neighborhood of 50 patients and a 20% response rate gives you a data set that would be pretty compelling to FDA if you're in an unmet need. And certainly, Grade 3 oligodendroglioma and post-Vora failure are 2 indications where there is absolutely nothing available to these patients.

So we think that's a wide open opportunity. Colleen?

Colleen Sjogren: You want me to take the ALK. Li, so your second question on IBTROZI and the slowdown. So a couple of things. In my experience and the team's experience, this is really the volatility that you expect in an ultra-rare market. Even when we look across at other TKIs in the lung space, you saw a sharp decline in EGFR and ALK Q2 over Q1 and then it bounces back. We can never attribute sort of a slowdown to one single cause, but the evidence that we do see here points in one direction. So the IQVIA data shows lower overall market status. We talked about that 15% pullback that we see.

And that aligns naturally with what we saw in our lab partner alerts moved the same way. So approximately a 25% decline there. So the good news in a market that's pulling back, IBTROZI still maintained more than 60% share of first-line new patient starts. So while reaching, by the way, the leading position in total active ROS1 TKI patients. So this is very consistent with a smaller market flow than a broad deterioration in our competitive position. So additional quarters will show, and we expect that, that will show that the market volume will also normalize.

David Hung: And Li, just because we've heard some confusion over our clinical trials and what endpoints are being used and when the readouts. Well, let me just reiterate that for everyone. So there's 4 trials. The SIGMA study is a PFS readout. That's going to be long. That's going to read out in 2029 or so. And against vorasidenib, that's going to also be a PFS readout. However, 2 of our studies are response rate studies. The Grade 3 oligodendroglioma is a response rate study, which we believe we will have data on starting probably mid next year. And the post-vorasidenib study is a response rate study, which we will also start to have responses in 2027.

So we would expect that. So while we cannot tell you exactly when the response will occur, we feel very confident given our data that we will see responses, and we think that 2027 will be the beginnings of a number of responses that we'll observe and hopefully go into a filing package for those indications.

Operator: Your next question comes from the line of Leonid Timashev with RBC Capital Markets.

Unknown Analyst: This is [ Zander ] on for Leo. So I know you touched on a little bit of this already. But I guess when looking at the post-Vora setting, are there any precedents or comps that you can point to that would be helpful when we think about reusing a mechanism, while moving down in treatment line, kind of how we can think about framing responses there?

David Hung: Is the question why we believe that we will have responses in the post-Vora setting? Okay. I mean, first of all, if you look at our response rate, it's significantly higher than Vora. I mean, more than double the Vora response rate. So clearly, we are -- we just have more responses. But #2, if you look at the kinds of patients we're treating, we have responses in sicker, more advanced types of glioma than the Vora has. And it's always hard to treat the more advanced, the harder ones than the easier ones.

So given the fact that we have high-grade responses when Vora has 0 and given the fact that we had more than double the low-grade response to Vora and given the fact that there's always some overlap in the spectrum that gliomas have between low and high grade, we would certainly expect to have responses in post-Vora failures. I think our data are pretty compelling in that regard. On top of that, we've made the point previously that our adverse events are different. Our -- Vora's primary adverse event is liver function test abnormalities. Ours are immune type reactions. Things that we believe indicate an increased immune activity, things like skin hyperpigmentation, arthritis, rash, hair loss.

These are things that we believe are consistent with an immune mechanism. And if you look at our responses that we've seen so far in all of our studies, as I mentioned, it can take 6 to 12 months to see a response. That sounds an awful lot like immuno-oncology. If you look at our response when we get them, they're really durable. If you look at our GBM, that patient's tumor has been gone for 3.5 years, high grade -- Grade 4 astrocytoma, gone for 3.5 years. Those are immune type reactions that we think completely differentiate us from Vora.

So just given our efficacy that we've seen so far and the kinds of adverse events we've seen and the durability of our responses, we would certainly anticipate that we would see responses where Vora hasn't.

Operator: Your next question comes from the line of Priyanka Grover with JPMorgan.

Priyanka Grover: So on the persistence trends in the frontline and second line, what have you seen throughout the quarter? Basically, are discontinuation rates still tracking with what was shown in the clinical trials?

Colleen Sjogren: Priyanka, so when we look -- yes, so when we look at treatment-related adverse events in the first line and second-line TKI-naive, we are tracking very closely. So when you look at launch through September, our TRAEs are tracking very closely to what we saw in our TRUST trials. So that's been consistent since launch.

Philippe Sauvage: And generally speaking, to your point, Priyanka, we've not seen anything different from what we've seen in the clinical trial in terms of patients staying on therapy, the time they stay on therapy and all of these things. Not anything different so far. Obviously, the clinical trial, we had more than 50 months of duration. Here, we've launched only 15 months. So we cannot say for the future. But it's clear that so far, we've seen tracking it exactly the clinical trial track. So really no difference there, which is very reassuring for the long-term potential of that market, of course.

Colleen Sjogren: And one thing maybe I'll add on to that, Priyanka. So keep in mind that many of the patients who started early in our launch on IBTROZI, they had received prior ROS1 therapies. So -- and progression in that more heavily pretreated population has been an important driver of where we saw those discontinuations. But -- and to Philippe's point, we monitor discontinuations by not only line of therapy, but cause, so not just in aggregate, and our adverse event-related discontinuations have, in fact, remained low and consistent with the trials.

Operator: Your next question comes from the line of Yaron Werber with TD Cowen.

Steven Ionov: This is Steven on for Yaron. One from us on safu. Are we inferring correctly that you might expect the Grade 3 oligodendroglioma study to be the faster readout versus the post-Vora? And then maybe a follow-up on the tumor growth rate, how would FDA acceptance of that endpoint change the timing on the path to market? And could we potentially hear an update around the growth rate before the ORR data come out?

David Hung: So I don't know which will be faster. I think that we feel pretty confident that the Grade 3 oligo study will be positive because we've seen great responses there. I think post-Vora, we also, as I mentioned, we have so much higher -- more than double the objective response rate in Vora in the low-grade setting and have significant high-grade response where Vora's are 0. So I just think the spectrum of activity is so different between safu and Vora. I feel bullish on that study as well. I can't tell you which will read out faster.

I think that the Vora study should accrue faster because there's more patients, but we started accruing the Grade 3 oligo study months ago. So that again, will they really be different? I don't know. Tumor growth rate, we think, is a really important endpoint. Now it's not accepted yet by FDA, but I think it makes the point that you can't have a response, a tumor that's growing can't shrink without changing its slope. And that's just a no-brainer. So when we change the tumor growth rate from positive to negative, it's hard to ignore. And we're going to assemble data to show how well that correlates with ultimate response.

But we do think that when you change a tumor that's growing with a positive slope to one that has a negative slope, certainly, the patient is going to feel a lot better about that as is his doctor. And I would imagine so with the FDA. Now whether or not they'll accept that at this point, we have no idea. We're not assuming that. We're still assuming they'll take response rate, but we will present those data with our objective responses to form a package, I think will be important in the future because I think that is where this field should head because I do think that you can't get a response without changing that tumor growth rate.

Philippe Sauvage: And maybe another point to keep in mind, we're not talking -- I mean, David, you say that often, we're not talking about the blinded study. So you can see response rate over time. And it doesn't necessarily mean you have to wait for a certain time to read out that we would do for PFS. This is response rate that we are monitoring over time.

So as we accumulate patients in both of those studies, we will have a better view of the response rate, and we will know where the slope is taking us to David's point about the tumor growth rate, which will give a lot of confidence to us that if the shape of that curve is changing, we will eventually get to the kind of response we are hoping for, and that's really important too.

Operator: Your next question comes from the line of Michael Yee with UBS.

Matthew Hagood: This is Matt on for Mike. Congrats on a nice quarter. Could you talk maybe for the Grade 2 low-grade, low-risk study, do you expect the control arm of that study to perform similarly to the original Vora study? Are there anything in the patient population to think about that might not be the same? Any thoughts there would be great.

David Hung: I do think it would be similar. So we're not inventing any new wheels here. We're just trying to use a better drug to get better results. That's -- we expect the trial to be very similar.

Operator: Your next question comes from the line of Mayank Mamtani with B. Riley.

Mayank Mamtani: Mike on for Mayank. Congrats on the share gains this quarter. So you had a slide showing or comparing IBTROZI to LORBRENA and ALECENSA, both of which grew about fivefold from your third quarter as first frontline patients accumulated. What gives you confidence that IBTROZI follows that same curve? And also on safu for next week, what should we focus on for the SNO posters?

David Hung: Yes. So as Colleen had mentioned, if you look at the sales in the first 5 quarters of LORBRENA and ALECENSA, they were in the range of $26 million to $30-something million. And we're back in that range despite the fact that ROS1 incidence is half of ALK. So in spite of being half the incidence, we're still generating about the same amount of sales. So we think that's pretty good. And they still grew that market fivefold more beyond that. And we think that given our trajectory, we should -- we're comparing quite favorably to the ALK launches. So we think that we're actually doing pretty well.

Philippe Sauvage: And the other thing which is very reassuring that Colleen was mentioning earlier, right, is that this has been, to your point, a very steady and important growth over time, but not necessarily like every quarter higher on new patient start. Colleen was mentioning that earlier. If you look at the new patient start in ALK, Q2 was down 19% versus Q1. So you do see in that rare space, some fluctuation. But despite those fluctuations, the trend is clearly up in that space and has been up for a very long time.

And because of the extremely long duration of our response and the very high tolerability of IBTROZI, we believe we're going to see exactly the same thing, which is a general trend going up and going up for a very long time, even if you could have fluctuation on new patient start one quarter to the next, those things happen.

David Hung: Yes, let me make another point. So if you look at the DORs of at least the alectinib, it's much, much shorter than our 50-month DOR. And LORBRENA didn't at the time, did not even know that the CROWN data will ultimately give them a 7-year PFS. But if you look at our duration, you're not going to even see that for years. So we're only 15 months out. You're not even going to see the stacking from IBTROZI for another full stacking for another 3-plus years, right?

So the fact that we're already matching the ALK launches at half the epidemiology incidents, and we haven't even gotten to the stacking suggests to us that we're going to do really well.

Mayank Mamtani: Got it. And for next week for the SNO posters, what should we focus on?

David Hung: We haven't -- you're going to see more data on depth and durability of responses. We can't give you a lot more color than that, but you're going to see more detail on the depth and durability of the responses that we presented before.

Operator: Your next question comes from the line of Robert Burns with H.C. Wainwright.

Robert Burns: Congrats on the quarter. Two questions for me, if I may. So obviously, we saw updated data for -- from the ARROS-1 trial at ESMO this year, and GSK is planning to file an sNDA in the coming months for zidesamtinib in the frontline setting. So considering that as well as the launch dynamics that you're now seeing within the frontline setting for IBTROZI, I wanted to get your thoughts on the potential impact of zidesamtinib's potential approval in the frontline setting on IBTROZI's future revenue potential in the front line. And then switching over to Vora.

Obviously, considering the fact that we're going to see up -- we're going to see data from the Phase II trials in 2027, which could potentially support an FDA approval. I want to get your thoughts as to how you're thinking about the buildout -- whether you'll have to build out your commercial team further to launch it in the CNS indications that you're pursuing in 2028.

David Hung: Let me take the first question, and I'll turn it to Colleen for the second. So the bottom line is we have a 50-month DOR in the first-line setting. We have not seen anything from the data on what their duration of response will be in the first-line setting. So I would just say that it's going to be pretty hard to beat a 90% response rate in a 50-month DOR. As we've mentioned, except for LORBRENA, there are no drugs in the history of oncology that have been able to better a 50-month DOR of IBTROZI. So I would say that we don't know how their label will look.

When their second-line label came out, there were some surprises that Jideytro had CNS warnings and precautions, which no one had expected. If you look at their adverse events, even now, 42% peripheral edema, something that's very noticeable to patients. CNS warnings and precautions, shortness of breath, 4% grade 3 shortness of breath. These are things that I think are going to make it more challenging to continue using drug in the first-line setting where you -- if you want to get to a 15-month DOR, you're going to have to have a pretty tolerable drug with 51 months of follow-up, we've shown an extremely tolerable profile for IBTROZI.

But after only 14 months of follow-up for Jideytro, as I mentioned, they already are up to 42% peripheral edema and 25% CNS toxicity plus all the other things I've mentioned. So I think the data will come out when the data come out. And right now, we think that we are the bar to beat, and I think it's going to be hard to match. Colleen, I'll let you turn.

Colleen Sjogren: Yes, sure. I'll add a little bit on to that. I mean, first of all, we expect competition to evolve. And I just want to reemphasize, when you look at the accomplishments of what my team has done across cross-functional marketing, market access, sales, medical affairs, when you look what they have accomplished in 15 months as a fourth entry into the ROS1 market, it's just remarkable. And what brings us a lot of confidence in the future is that KOLs, so our top thought leaders consistently cite our durability and our data maturity as key differentiators.

So as David said, with many describing our approximately 50-month median duration of response, supported then by our 51 months of median follow-up, it just has created a benchmark for them. So combined with our favorable tolerability profile, this just reinforces physician confidence, and I would say, particularly in the first-line setting. So we will continue competing what I believe is most important is on the totality of evidence and on our execution rather than assuming any market share is permanent. We are ready for competition, and we feel well positioned.

Philippe Sauvage: And Robert, to your structure point about launching in glioma, obviously, there are lots of things that we will not have to redo. Like we could leverage fully our commercial organization as it is. The only difference is different calling points. So we potentially need to add some reps. But when you think about day 1, there are about 17 reps. So it's not -- you're not talking about a huge team. Glioma is treated in a certain number of centers, which is rather limited because obviously, it's brain cancer, you don't treat that everywhere.

So we are thinking about a relatively limited commercial team that will be able to fully exploit all of the synergy we have by being already a fully commercial organization when you think about gross-to-net, OpEx management, all that we have to support sales force today, all market access, et cetera, all of this will be leveraged. So it's an addition because different calling points, but a relatively small addition.

Operator: Your next question comes from the line of Silvan Tuerkcan with Citizens JMP.

Joshua Werman: This is Josh Werman on for Silvan Tuerkcan. Congrats on the update today. Maybe just on the variability in the ROS1 diagnosis, how consistent has that, I guess, 3,000 annual diagnoses been year-over-year? And is the variability, is it year-to-year? Or is it more quarter-to-quarter, I guess? And then additionally, maybe could you speak to some of the relevant updates in glioma at ESMO?

David Hung: Okay. So let me be clear. We were never talking about any data that suggests that the epidemiology is on. There is a large amount of literature that supports roughly 2% incidence of non-small cell lung cancer being ROS1 positive. But we were talking about just that when you have a rare indication like ROS1, quarter-to-quarter, there could be lumpiness. Things could change. We've seen this -- if you look at ALK scripts, they varied as much in general. Just recently, I believe that one of the quarters recently showed a 50% reduction in ALK scripts in the quarter. We've seen that in other orphan indications. So we don't believe that the overall epidemiology of ROS1 is off.

We just believe that from quarter-to-quarter, when you have a rare indication, you may see some lumpiness and you may have quarters that are down, quarters that are up. But overall, it will equilibrate to roughly 2% of all lung cancer.

Philippe Sauvage: New patients properly identified can fluctuate from one quarter to the next, and that's what happened, as we said, in our ALK, KRAS everywhere really. But the trend in the epidemiology stands, which to your point means that it's a quarter-to-quarter fluctuation, not a year of change.

Joshua Werman: And maybe on the...

Philippe Sauvage: I'll add it with regard to your question in the landscape.

David Hung: Yes, I don't think there's anything in glioma that's really changed. In fact, it really further highlights how special safu is because there were actually no data for any agent that has shown results that are as compelling in our opinion as safu. So nothing that we can identify in the landscape. We do think that safu is the most promising drug being developed in glioma today, and so we are excited about the program.

Philippe Sauvage: And to add to that, another point we made in the past is that because we are going to develop safu in markets where Vora is not available, it's going to be very, very hard for anyone in the future to develop anything in IDH1 mutant glioma without comparing to an active comparator, which will be either us or vorasidenib at that time. So not only we've not seen very much other development going on in that space, but any future development in that space will be much more difficult because we will have to compare to an active comparator, and we know it's much harder to do and much longer.

Operator: Your last question comes from the line of Boris Peaker with Jones Research.

Boris Peaker: Just 2 questions. On IBTROZI, can you comment on the gross to net adjustments this quarter and how that is trending? And the second question on the SIGMA trial. I'm just curious, in post-chemo radiation, sometimes you see pseudoprogression, which could complicate the modified RANO assessment. So I'm just curious what steps are you with a centralized blinded independent committee taking to adjudicate for true progression versus maybe treatment-related inflammation or pseudoprogression?

Philippe Sauvage: Thank you for your questions. I'll start with the GTN. So pretty much stable this quarter like it has been in past quarter. As I mentioned in previous calls, the next time you're going to see our GTN -- I'm sorry, can you hear me? Yes. So next time we're going to see an evolution of our GTN will be at the time of our next price increase because of inflation impact and things of that nature. But it's been very stable throughout the year, and we think we really stabilized around this 30% gross to net. That's where we are, and we believe we're going to stand until the end of the year.

And I'll let David comment on the second question.

David Hung: This study is being compared against placebo with a blinded independent committee review. So I don't -- I think that there will be significant differences between the 2 populations, but the comparator is placebo. So I think that's the control. And I don't know how else to comment on that. It's a controlled study. We think that's.

Boris Peaker: Yes. No, I'm just worried that even on a placebo, the radiation itself could cause pseudoprogression?

David Hung: Well, but they're going to both -- they should be in both arms, though, right?

Boris Peaker: Yes.

David Hung: The difference will be the drug. And just given the results we've seen so far in our safu studies, we think the drug will be a significant difference.

Operator: There are no further questions at this time. I will now turn the call back to David for closing remarks.

David Hung: Well we want to thank you all for your support, and we look forward to updating you on our next call. Thanks so much.

Operator: This concludes today's call. Thank you for attending. You may now disconnect.

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