Morning, everyone. My name is Dina Almanshed, one of the U.S. biotech analysts here at UBS. Joining me today is the President and CEO of Vertex Pharmaceuticals, Reshma Kewalramani. Thank you so much for joining us, Reshma, today. I'm glad to have you with us. Thank you, Dina. Of course. Maybe just to get started, we can walk through the base business with cystic fibrosis. Obviously, Trikafta continues to grow really well. You're in the midst of the Alyftrek launch. Maybe talk through the dynamics of the early days of this launch, how that's going versus expectations, and who has been the initial patient population that's come onto this drug. Just what's the impact of, or maybe just the initial feedback that you've been getting from providers and considering the new liver monitoring, and just a lot of different dynamics there. Maybe if we can just run through them and get your thoughts. Sure. Good morning, all. It's a nice, intimate group, so I'm very eager to talk with you and tell you a little bit about where Vertex is. On cystic fibrosis, it is obviously now a very large business. We've been in it for, gosh, 15 years or so. The fifth and latest CFTR modulator regimen is Alyftrek. It was approved in December of last year, and so we're just about a year into our launch. Overall, it is going very well, and I'm really pleased with what we're seeing. With regard to the dynamics and how we see patients who are previously on Trikafta or any of our other medicines and how the movement onto Alyftrek is going, here's the big picture of somatic. Alyftrek is the best medicine that we have ever invented. I believe that, and the reason we say that is because the ultimate defect in a patient with cystic fibrosis is in a protein called CFTR. That CFTR protein is a full-body protein, and that is what leads to elevations in sweat chloride, the sticky mucus in the lung, pancreatic dysfunction, liver dysfunction, etc. The medicine of all of the ones that we have made and are available that restores CFTR function to its greatest level, as measured by sweat chloride, is Alyftrek. This is a very educated population. This is a genetic disease. It runs in families, so children have this at birth, and parents are very motivated, patients are very motivated to be on the best medicine. Maybe the last thing to say on that is the patients that I used to see when I was a young doctor were thin, small, breathing heavily, and the average age of death was about 30 years of age, unfortunately. The cause of death was lung failure. That is not CF anymore. The patient is a bigger-looking person, taller, bigger. They're not breathing so hard. They have much better pancreas and liver functions, and the projected age of life is well over 70. What that means is now people are looking to make sure they're living their healthiest life, not worrying about dying from liver disease. That's why Alyftrek, with its best to date CFTR function, is so important. We have divided up the people into three basic categories: people who are new to medicine, people who are discontinued from one of our older medicines and want to come back, and people who are on one of our older medicines, including Trikafta, and want to make a switch. Unsurprisingly, the uptake has been fastest in those who are new to medicine. Alyftrek not only has greater sweat chloride benefit, but it has 31 more mutations than Trikafta. Those 31 mutations translate to something like 400, 500 patients in the U.S. So those patients, again, unsurprisingly, because they've been waiting for a medicine that treats the underlying cause of their disease, they were the first to move. The discontinued are next, but the discontinued are harder because they've not only stopped their medicine, but they may be not coming to their clinic. They've stopped coming to their clinic. On the switches, I would say it's steady, and it continues to be so. It goes to a point that Dina made. People who are on Trikafta love their Trikafta. They have a visceral emotional attachment. People send us pictures of when they got their Trikafta box. People post on YouTube and Instagram when they got their box, and they remember their anniversary. One of our younger patients just posted that he is six years on Trikafta because he was amongst the first. There is a real emotional reaction. We do not force people to change. If they're happy with their drug, so be it. As I said, these are a very educated population. Alyftrek is once daily versus Trikafta, which was twice a day. Honestly, I did not think that that was such a big deal. It turns out that it is a big deal, especially for adolescents. The efficacy is clearly greater. Those group of switchers are switching over, and I expect that that will continue. The point that you made is an important one. There is additional monitoring that came into being in December of last year in the U.S. for both Trikafta and Alyftrek. You have to now monitor once a month for a little period of time. Then you can go to quarterly, then annually, which was the old schedule, quarterly and then annually. People are thinking through how to do this, when to do this, how to do it in the most simple way. I'll just end by saying we just launched outside the U.S. The U.S. regulatory approval was December of last year. We just got regulatory approval in Europe in the past couple of months. We have just secured reimbursement in countries like Denmark, Germany, the U.K. in the last four-six weeks. We can see the early trends in Alyftrek outside the U.S. Remember those 31 mutations I was telling you? There are 400, 500 in the U.S. There are 4,000, 5,000 ex-U.S. There is a bigger group of the new patients who are coming onto drug, and then there are the dynamics of switching. The important thing to know about the ex-U.S. is that the liver monitoring did not change. It is the same as it used to be. There is not a logistical thought process that the patients there need to go through. Early days, but launch looks really good there as well. Great. That actually moves up to my next point about the opportunity. I think you mentioned it's about 4,000 patients ex-U.S. How do you think about the cadence of that launch? Maybe when can we see sort of an inflection and the ex-U.S. patients start really coming on? I mean, reimbursement in ex-U.S. takes a while, so I know that that's always a hurdle for every drug and every company. How can we think about that cadence and the dynamics playing out in 2026 and beyond for Vertex? Yeah. Yeah. I think in the ex-U.S. setting, the three categories of patients are the same. There's just more patients in that category of first getting access to a medicine because there are more ultra-rare mutations there. I think it will be those coming onto drug, discontinued, followed by the transitions. The timing dynamic there is going to be reimbursement. We have reimbursement in some of these early countries. As you know, the average in the EU is something like two years to three years. We have clearly surpassed that because we already have reimbursement in a place like England, which is not so easy, not so nice. I do think that over the coming year, and certainly globally in the coming years, I do expect that the majority of CF patients will make their decision to move to Alyftrek because it is the best medicine we have to date. Awesome. Okay. I feel like people are focused on Trikafta, Alyftrek. I don't think the CF portfolio really stops there. There's a bunch of other assets that you guys are working on. I know that there's a next-gen 3.0 molecule that you guys have sort of mentioned. Maybe what's the status with that, and what are your expectations for that molecule, and how are you thinking about that as the portfolio expands over the next couple of years? Yep. Let me hit on that one directly, and then let me go and tell you because you might be wondering, "Well, why are you still doing this?" The next medicine in the lineup is VX-828. That medicine has now initiated the CF patient cohort. We finished healthy volunteers. We have the PK and the DDIs and all that good stuff. As of now, we are in the patient cohort. Why are we doing this? Trikafta is an amazing medicine. Alyftrek is an amazing medicine and has even more benefit by way of the once-daily dosing and the greater CFTR protein function. Here is what our goals are in the big picture. One, bring forward a medicine that can treat the 95% or so of patients. We used to say 90%. It turns out it is 95% who can benefit from oral CFTR modulators. That one gets a check starting with Trikafta, certainly now extended with Alyftrek with the additional mutations. Second big goal, bring the majority, if not all of our patients, down to what we call carrier level, otherwise known as normal levels of sweat chloride. That number is 30 mmol or less. Third big goal is bring forward a medicine for that last 5% of patients who simply don't make any protein, so a small molecule cannot help them. Our approach to that, our first approach is with VX-522. It's an mRNA-based treatment. The reason we're pursuing VX-828, and you're very correct, it doesn't end there. We have a whole slew of molecules beyond that. If it is humanly possible to do better than Trikafta and Alyftrek, we're committed to being the ones who do so. It's getting awfully hard. If it's possible, we're going to be the ones who do it. Okay. That's, I think, a great goal. I guess maybe another asset that you guys have is partnered with Moderna for CF. I know that that one, I believe, had a clinical hold. What's the status with that one, and what is the differentiation there? I know that that one's a little bit unique because it's focusing on the population that is not necessarily part of that 95%. Correct. How are you thinking about that program, and where are you guys at? Where are you with Where are you with that? If you round and say that there are about 100,000 people with cystic fibrosis in the Western world, then about 5,000 people won't be able to benefit from CFTR modulators. The CFTR modulator, the small molecules, need a place on the protein to hook onto. If you don't make any protein, it won't work. For those patients, we need some kind of nucleic acid therapy, and the lead is VX-522. That's that program partnered with Moderna. Two important things to note. CF is actually a systemic disease. It's not a disease of the lung, which is how we think of it because, as I mentioned, that's the way our patients used to die. It's a systemic disease. You see it in the sweat chloride. You see it in pancreas. You see it in liver. You see it in the stature of our patients before CFTR modulators. The absolute best medicine is a small molecule so you can get the full-body effect. For the last 5,000 or so patients, the nucleic acid approach, though, is a lung-directed approach because we need to somehow deliver the cargo, the mRNA. It is hard. Delivery is the hard thing in cell and gene therapy, right? We have an idea, and we have an approach, and we're in the clinic with an LNP-based approach to deliver the cargo to the lung. Actually, the best medicine is a small molecule. This medicine is being delivered to the lung via a nebulizer delivered through an LNP. It was a program that we put on pause as we work through a tolerability issue. I'm really happy to say the program is back up and running. We're enrolling and dosing patients. It is in CF patients, so I expect we'll be able to share safety and efficacy sometime next year. Okay. That's great. I guess moving on to pipeline. Actually, I know most people would start with pain, but I want to start with kidney. Given that we just finished ASN this week, pove is an interesting asset. Obviously, these drugs are sort of all the talk right now in Wall Street. Maybe just remind us, you have the phase III asset in IgAN and with pove. Maybe just remind us the timelines. I've sort of done some math. You guys have completed enrollment, say, Q1, Q2 timeframe. Maybe you can share the specific month. It's a 36-week endpoint. If we do the math, we kind of expect data first half 2026. I think on the Q3 call, you guys are already starting the rolling BLA. You plan to file shortly after that data. If you guys use a priority voucher, that means you can probably be approved as soon as late next year. That is an exciting new portfolio for you. This would be your first kidney drug that would be marketed if it was to be approved. Does that timeline sort of sound reasonable to you? How are you thinking about the expectations there with that study? Yep. The timeline sounds reasonable. You said we're all the renal medicine is all the talk of Wall Street. I never thought I'd hear those words out of anyone. As a card-carrying nephrologist, we were always second, if not third or fourth fiddle to diabetes and heart disease and all of the other areas. Renal medicine is having its day, and there is indeed a renaissance in renal medicine drug development, which is fabulous. All right. IgAN. IgA N is an important disease. We've known about it for a long time. We've actually known the causal biology for a long time. We just haven't had great medicines for it. Now we're at the point where we do have what are potentially great medicines. The one from Vertex is povetacicept. Just as a quick primer, IgA N is a disease that is an autoimmune disease, and we understand exactly where it comes from. There is this aberrant antibody called Gd-IgA. And when you have this aberrant Gd-IgA, you make autoantibodies against it. Those deposit into the kidney. That's what leads to disease. The way the disease manifests is proteinuria, hematuria, decreases in kidney function, and ultimately death, dialysis, or transplantation. That's the disease. We have had an interest in IgA N for a long time at Vertex. We just didn't have an approach that we thought was transformative. When we saw Alpine and the emerging data there, we purchased, we acquired that company for povetacicept for that reason. Where are we today? The interim analysis cohort for potential accelerated approval was enrolled a little while ago. Now we have also finished complete enrollment in the entire phase III study. It is a little bit more than 600 people, and we enrolled that in a little bit under 15 months. It is the fastest enrollment of any contemporary IgA N study, which tells you a little something about both the disease and about Tovy. We secured breakthrough designation from the FDA, and we secured rolling submission. I believe we are the only ones in the IgA N space that have that. We have decided to use one of our priority review vouchers to guarantee a priority review. That means we are going to submit our first module before the end of this year. We are going to complete our submission in the first half of next year. Because we are using our voucher, it means it is a six-month review as opposed to the standard 10-month review. Yep. Yep. That's exciting. I mean, I think that that'll be a soon-to-watch launch in 2027, hopefully, if it all goes well. I think the fourth pillar is coming to Vertex. Yes, it definitely is. You guys actually just shared additional phase II data ASN this weekend. I think we also there's a couple of other players that are going after IgAN, Vera and Otsuka, and they also shared some of their phase III data. Maybe just talk us through the differentiation there of pove versus these other assets. I mean, they're kind of going to be all in the market around the same time. How does pove stand out? Yeah. In short, I believe pove has best-in-class promise. The reason I say that is the following. You can divide the treatment landscape for IgAN into maybe three categories. Maybe you can make more, but three is pretty good for government business. The first is your general nonspecific medicines, ACEs, ARBs, ERBs, etc. People should use them. They've been around forever, and they are nonspecific, but they have been shown, generally speaking, to be protective of the kidney no matter what the underlying kidney disease is. I would use those. There are steroids and long-acting, short-acting, what have you, but they have quite significant side effects and have not been shown to be disease-modifying. You have your targeted therapies. In the targeted therapies, I would carve out APRIL/BAFF versus everything else. BAFF alone is not an APRIL/BAFF. There are marketed molecules that are BAFF only. APRIL only is not APRIL/ BAFF. It's APRIL only. In my mind, APRIL/ BAFF is very important when you think about IgAN. IgAN, as we discussed, is a disease where you have autoantibodies being produced against this autoantigen. If you look at the B-cell development, there's a slide that we and others showed. It looks like a Skittle slide where you have an early B-cell that matures into a plasma cell, and the plasma cell is what releases your antibodies. There are multiple pathways, but for simplicity's sake, think about that Skittle slide and think about the fact that BAFF works early on in B-cell development and APRIL works later in B-cell development. If you told me, "Look, design your best idea to make a medicine for IgA N," I would design a dual APRIL/BAFF inhibitor because I would not want to have only BAFF inhibition, and I would not want to have only APRIL inhibition because I would expect that I would have lesser efficacy versus having dual. In the dual APRIL/BAFF class, there are two drugs in development. We call the—I do not know how to say it. Let's call it the base drug. The base drug is called a wild-type TACI. It exists. It is wild-type. And what we have done is something called directed mutagenesis to take that wild-type TACI and change it over time to have it have the kind of properties we would want for drugs. Pove has high potency. It has high binding affinity. Importantly, it has high tissue penetration because we've engineered this molecule to do those things. We want this molecule to do those things versus wild-type TACI so that it's best equipped to go. Remember, we talked about the glomerulus and all the action is where these complexes form in the kidney. You need your drug to go to the kidney where these immune complexes are located. Those are the reasons that pove, I think, has best-in-class potential. The phase II clinical data obviously tell you that, yep, clinically, what we thought would happen is exactly what happened. Now we're at the point where we're awaiting our phase III data. Exciting. Okay. I should say, Dina, and maybe you would get to this, in biologics, it's really, really important. It is not an afterthought, and it's not a nice-to-have to make sure that you have patient-centric characteristics about how you're going to administer it because this is not a pill. This is an injection. Market research shows this, but it's not rocket science. Patients would prefer once-monthly dosing to more frequent dosing. Small volume is preferred to big volume. Autoinjector is preferred to anything else. And the Vertex pove medicine is once a month, subcutaneous, at home, 0.46 ml via an autoinjector. And you have to go through all of the others to see, okay, well, that one's once a week. That one is 4 ml. That one is 2 ml x 2. That one is something else. And so I think this is an important thing to think about. No, that's definitely 100%, I think, the right way to think about it because how uptake is important and compliance is important and having a medicine. This is not just in IgAN, but across all other indications as well. Maybe then povetacicept is a pipeline and a product. You have your phase III PMN, and I believe you also want to start or move into MG, myasthenia gravis. I think the myasthenia gravis is actually interesting because I know that people are also excited about the opportunity for these dual inhibitors to go into MG. How are you thinking about maybe PMN and MG as indications as you progress those phase IIIs? Yeah. One of the great advantages of a drug like pove is exactly this thing, what people have been calling a pipeline in a product. It is a dual inhibitor with those characteristics that then can work for any autoimmune and B-cell-driven autoimmune disease. One example is IgAN, but another great example, and it happens to be in kidney disease, is membranous nephropathy. The autoantigen is a slightly different one, but it does not matter. The same disease process ensues. We are already in pivotal development there. It is a reasonably small study. It is less than 200 people, and it is a full approval endpoint. I expect that is going to be the next kidney disease after inaxaplin for AMKD. I see the Vertex pipeline being povetacicept for IgA N, probably first. I imagine it is VX-147 or inaxaplin for AMKD, a different kidney disease. I think it is membranous. For pove, it's going to be IgA N membranous. After that, I do think myasthenia gravis is next on deck. We are wrapping up our discussions with the regulators, and I'll be able to tell you more about what that study looks like. Myasthenia is another extremely well-understood B-cell-mediated disease, and so I'm excited for this possibility. Awesome. Okay. I'll try to squeeze one more on kidney before we move over to pain. April 1, that's—I mean, when I started looking at Vertex, that was actually the first data set that I ever read out when I was working on this. It's been a long time coming, and I think now we're in phase III. The data's somewhere around the corner in 2026. Maybe just talk about where you are with timelines and how the enrollment's going and when we can see that data. Yeah. Yeah. 2026 has a lot of milestones, a lot of big milestones. Phase III, we'd add to it. It's going to be a great year. Inaxaplin also holds a special place in my heart because I was Chief Medical Officer when we started that program and turned over that phase II card. Super interesting disease. You know I'm a nephrologist. I stopped practicing around about 2004. We didn't even know that this disease called AMKD existed. It was named around 2010 or so. It's a brand- new disease. We understand the genetic underpinnings. And this inaxaplin study has the trifecta of what everybody wants in a clinical trial. It's enrollment based on genetic mutations. Two, APOL1 alleles. Two, it was an adaptive to three design. It's now in phase III. And three, we have an agreement with the FDA for accelerated approval. We are done with the enrollment for the interim analysis cohort. I do expect the readout will be next year. There are no medicines available that treat this disease, and this would be cracking open a new disease area. It feels awfully similar to CF in that way. Yeah. Yeah. That's how I would think about it too. Okay. Moving on to pain in the last 10 minutes or so. The Journavx launch has progressed, honestly, quite nicely when we look at the TRXs. Volumes are up and ramping. Can you maybe just talk about the progress on reimbursement and the feedback you're receiving from payers? My understanding is two out of the three PBMs, you guys are on the formulary there. Just elaborate on what that means. I know that you're on Tier 3 formulary access for some of them. How does that really play out for patients? Is there any impact there? Yep. Yep. Yep. The Journavx launch is enormously important. It's important because this is a big opportunity, really big. Let's say 350 million Americans, every one of them can have acute pain. And there is a raging opioid crisis in our country. To have an alternative, effective pain medicine that doesn't have addictive potential, it's huge for us, for science, medicine, and for the company, given the opportunity. Let me just give you some stats if you're trying to get a quick sketch in your mind about, well, how is Journavx going? In the first quarter, it was something like 10,000 scripts, something like that. We launched it in about March of this year. The approval was in January. Second quarter was something like 70,000 scripts. Next, it was 170,000 scripts. What we said on the earnings call last week is we're well over 300,000 scripts as of mid-October. It is really going nicely. What are the important milestones to be watching for as you watch this launch? I would say the most important is the one you pointed out, reimbursement. On that front, we have 170 million lives already covered. That includes two of the large three PBMs on the private payer side. I would describe the conversations with the third PBM, which we have not yet secured, to be advanced, positive, productive discussions. On the government payer side, there is Medicaid to think about and Medicare. On the Medicaid side, we are going state by state to secure access on formulary where there are not prior auths and no step edits. It is particularly important here because people are in acute pain. We cannot tell them, "We will come back another day," or, "Let me check your prior auths." They need their medicine now. We've already secured, I think we said 18 on the call, and we continue to make our way. Our goal is obviously all 50 states. On the Medicare side, we have some coverage, and we're working to get all of our Medicare patients covered. The important point to know is while we're working to secure this coverage, we have a patient support PSP program. If your doctor writes a script for you, you go to the pharmacy to collect it. Even if you do not have coverage, you will get it, and we pick up the tab. That is why, obviously, at the beginning of this ramp, the gross to net is very high, and that will ramp to a more normal level as we secure reimbursement. We're also doing quite a bit of work in hospitals to make sure it gets on formulary. It gets on discharge orders and order sets because those are very routinized, if that's a word. It is a very—you just have a structure. You just do your checkboxes. We need to make sure that we do that. The last thing we are doing is awareness. This is a disease that can affect anybody. That is 1.2 million doctors in the U.S., and it is all 350 million Americans. We are doing quite a bit of work on brand awareness. Awesome. Back to the point of 2026 being a big year for Vertex. I mean, I think this is one of the very few companies that has multiple phase III readouts coming out in 2026. Chronic, moving on to sort of the chronic pain and DPN, you have two phase III studies. One that was started a little bit later than the first one, but I think the guidance has been that you plan to complete enrollment and have both of them readout together in 2026. Where are you guys with the enrollment for both of those studies? And how has the trial—I mean, you had some phase II data, I actually believe maybe almost more than a year ago now. Yep. Yep. Yep. Yep. What have you done to sort of control for the placebo response and the variability, given pain and especially chronic pain is sort of a challenging landscape? Yep. It It is. Pain of any variety is a tough disease area to work in because the endpoint, pain reduction, is ultimately a subjective endpoint. I could demonstrate to you that there is no transmission of pain by looking at your neurography, but if you tell me you have pain, I cannot tell you that you do not have pain. It is a complicated area. On the other hand, it's also a really significant area of unmet need, and we have specific and unique skill in working on these channels. It's not like NaV1.8 was our brilliant idea. It's been known in the field for decades. It's that nobody could crack what is called the holy grail of pain, which is NaV1.7. We're working on that, and NaV1.8, which we have in the form of Journavx. What I would say in terms of chronic pain is we have our two studies now ongoing in diabetic peripheral neuropathy. That's a market opportunity of 2 million patients. When Lyrica was a branded drug, that was the main indication there, and it was a medicine at that time that was more than $5 billion in revenue. It is big in dollar size. It is big in number of patients. Because we are looking to go to a circumscribed number of sites because of the placebo effect, you want to control the number of sites. You want to go to sites that are very good at doing this, can train their patients and such. The DPN study number one, which did start earlier, is going to likely slow down as we bring in DPN study number two, which is why I do think both of the studies will end around the same time towards the tail end of next year. It is a 12-week study, so after enrollment completes at the tail end of next year, we need to wait for 12 weeks for the results. Okay. So it sounds like it can probably be maybe year-end 2026 or the earliest, but maybe in early 2027 catalyst. I think so. So high confidence we'll be done with the study enrollment by end next year. Okay. Awesome. Maybe just one last one here on pain, VX-993. Obviously, like we said, chronic pain is notoriously challenging, and some of the drugs are efficacious in acute but not in chronic or maybe the other way around. Maybe just talk what you've seen with VX-993 in acute. Maybe talk about your expectations because you're moving that into a chronic study phase II, and that's reading out next year as well. Just what are your expectations on that asset in chronic specifically and how you can think about it? VX-993 is another NaV1.8 inhibitor. It is not known, which is why we're doing the work to determine what the case is, whether VX-993, which was not better than Journavx in acute pain, it was not better than, whether or not it will have different efficacy in diabetic neuropathy, which is why that is still continuing in its phase II program. We will know the answer to that, and it's really important to know it because that's what we use to build our models and to take that data and then retrain our models so that when we make newer and newer medicines, we know what to expect. He or she who has all of that data and can go back and train the models using preclinical and clinical data, I do believe will win in any disease, but it's particularly true in pain. I think that we should have results for that study next year. Those will be phase II DPN trial data. Okay. Awesome. I think we just have a couple of a minute here, but maybe on something that is actually, I feel like, under the radar, but the type 1 diabetes program. I think you said on the Q3 call that there was a pause that was on that program in terms of enrollment, I believe. Maybe any color that you guys have on that? Yep. Yep. The type 1 diabetes program, it is like sci-fi, except it's real and it's happening. If any of you who know science and medicine or type 1 diabetic know that if you have type 1 diabetes, if you don't take insulin, you will be dead in between five and 10 days. That's just what happens because your body produces no insulin. What we have done is made allogeneic. That's to say off the shelf. It doesn't need you. It's not like a CAR-T where you need each one person. We have an allogeneic stem cell-derived program where we've already dosed, treated, and shared data from about a dozen people, and 10 of the 12 were insulin-free at the one-year point where we last shared the data. That's remarkable. They're not taking any exogenous insulin, and these people have been taking 30-40 units of insulin a day, multiple times a day. What we shared on the call on Monday is that enrollment is completed in the pivotal trial. We have postponed completion of dosing while we work through a manufacturing analysis. I'm not going to share any more because it's a pivotal program. Obviously, we want to use all of that data because it's a phase III program, and in order to do that, we need to maintain study integrity. I won't make any more comments. When we finish dosing, you'll certainly hear from us at that point. I hope it helps in the event you miss the earnings call. Okay. Thank you so much, Reshma. This was really great, and we hit on a lot of great things. It was great seeing you, and thank you for being with us. Very nice seeing you, Dina. Thank you.