Vertex Pharmaceuticals Incorporated

Operator: Good day, and welcome to the Vertex Pharmaceuticals Incorporated first quarter 2026 earnings call. All participants will be in a listen-only mode. After today's presentation, there will be an opportunity to ask questions. Please note this event is being recorded. I would now like to turn the conference over to Susie Lisa. Please go ahead. Susie Lisa: Good evening, all. My name is Susie Lisa, and as the senior vice president of investor relations, it is my pleasure to welcome you to our first quarter 2026 financial results conference call. On tonight's call, making prepared remarks, are Reshma Kewalramani, Vertex's CEO and president, Charles Wagner, chief operating officer and chief financial officer, and Duncan J. McKechnie, chief commercial officer. We recommend that you access the webcast slides as you listen to this call. The call is being recorded, and a replay will be available on our website. We will make forward-looking statements on this call that are subject to the risks and uncertainties discussed in detail in today's press release and in our filings with the Securities and Exchange Commission. These statements, including, without limitation, those regarding Vertex Pharmaceuticals Incorporated's marketed medicines for cystic fibrosis, sickle cell disease, beta thalassemia, and moderate to severe acute pain, our pipeline, and Vertex Pharmaceuticals Incorporated's future financial performance, are based on management's current assumptions; actual outcomes and events could differ materially. I would also note that select financial results and guidance that we will review on the call this evening are presented on a non-GAAP basis. I will now turn the call over to Reshma. Reshma Kewalramani: Thanks, Susie. Good evening all, and thank you for joining us on the call today. Vertex Pharmaceuticals Incorporated is off to a terrific start in 2026, which we see as a year defined by execution. Q1 revenue growth was strong across the portfolio as we reach more patients with more products and delivered total product revenue of $2.99 billion, reflecting 8% growth year over year. Importantly, we achieved key commercial milestones for each of the newer products since launch through end of Q1. AlifTrack exceeded $1 billion in cumulative revenue. More than 500 people have initiated their Kasjevi treatment journey. And over 1 million prescriptions have been written for Jernabix. Another highlight in Q1 was that products from the new disease areas, namely KASJEVY and GERNAVICS, drove approximately 25% of total product revenue growth. Execution in R&D was equally strong with multiple regulatory submissions recently completed and more anticipated, combined with rapid progress across clinical trials and important advancement in research. Let me spotlight a few accomplishments. First, on POBI, the interim analysis results from the Phase III RAINIER study in IgAN on efficacy and safety from top to bottom were sparkling and further fueled our enthusiasm for Povi as a potentially best-in-class BAFF/APRIL inhibitor. I was exceptionally pleased with the rapidity and quality of the recently submitted BLA filing for POBI in IgAN. Indeed, at 27 days from database lock to regulatory submission, this was the fastest submission in Vertex history. Equally notable is the urgency with which the Povi primary membranous nephropathy and the Povi myasthenia gravis programs are advancing. In membranous, the Phase II study has been fully enrolled and the Phase III program has already initiated. In addition, the Phase II proof-of-concept myasthenia gravis trial is underway. Second, on KASJEVY, I am also very pleased with the rapidity and quality of this sBLA submission for KASJEVY in 5–11-year-olds with sickle cell disease or beta thalassemia. The KASJEVY filing has been granted a Commissioner's National Priority Voucher, reflecting the importance of treating this younger age group before some of the most serious complications of the disease can begin. Overall, Vertex Pharmaceuticals Incorporated continues to extend its leadership in CF, drive growth with new product launches, while building out our disease area franchise in nephrology, accelerate programs in mid and late stage development, and advance the earlier-stage R&D pipeline. Tonight, I will limit my R&D comments to CF as well as the pipeline programs with the most significant new information to share, certain renal programs, Povi, myasthenia gravis, and zamylosel in type 1 diabetes. Starting with CF, four quick R&D updates for this quarter. We recently reached a significant milestone in the U.S. with label expansions for both AlifTrack and TRIKAFTA. With this expansion, patients with a clinical diagnosis of CF who have at least one variant in the CFTR gene that is responsive based on clinical and/or in vitro data are now covered by the AlifTrack and TRIKAFTA labels, reinforcing the impact of these medicines regardless of the location of the variant in the CFTR protein. This is a significant expansion of eligibility that reflects decades of investment, effort, and a relentless pursuit of the science. It is also a great example of innovation, using results from clinical trials complemented by in vitro data to expand the benefit of Vertex CFTR modulators to about 95% of people with CF, including those with rare and even N-of-1 genotypes. As we expand the AlifTrack and TRIKAFTA labels to additional mutations, we are also expanding the labels to younger patients. We will soon submit for approval for AlifTrack in patients 2–5 years of age, where you may recall our pivotal trial demonstrated a remarkable 65% of children reaching normal levels of CFTR function. We also plan to submit for TRIKAFTA in children 1–2 years of age in the near term. In addition, we continue to advance our next-generation 3.0 CFTR including VX-828, which is currently in a study of patients with CF. We are on track to complete the study and share results in the second half of this year. Following closely behind VX-828 in the family of next-gen 3.0 are VX-581 and VX-2272, both of which are currently in the clinic in Phase I healthy volunteer studies. As we have consistently said, if it is possible to do better in CF, we are committed to being the ones who do so. And finally, on VX-522, the mRNA therapy we have been developing for people who produce no CFTR protein and therefore cannot benefit from our modulators. We previously disclosed tolerability issues in this program. Despite actions we have taken in the trial to overcome these issues, we have not been able to do so, and as such, we have chosen to discontinue the program. Given this early termination, we will not be able to assess the efficacy or full safety of VX-522. We will be working with sites to close out the study in the coming weeks. Moving on to our renal franchise, which continues to make quick progress and is rapidly establishing itself as Vertex Pharmaceuticals Incorporated's fourth franchise along CF, heme, and pain. In total, we have four programs in mid and late-stage development in renal: Povi in IgAN, Povi in primary membranous nephropathy, enaxaplin in AMKD, and VX407 in ADPKD. Tonight, I will cover the first three programs, starting with Povi in IgAN. Recall Povi's differentiated, potentially best-in-class profile stems from its specific design as an engineered TACI fusion protein with binding affinity, potency, and PK properties that deliver optimal dual BAFF/APRIL inhibition. The dual inhibition and engineering advantage is evident in both the interim analysis data of the RAINIER study, where we saw rapid, deep, and sustained improvement in proteinuria, a favorable safety profile, and consistency across all subgroups, as well as in three key patient dosing benefits: once-monthly dosing, small volume, and subcutaneous administration via an auto-injector. Overall, the Phase III interim analysis data represent a home run in terms of study design, execution, and results, with Povi achieving statistically significant and clinically meaningful results across all primary and secondary endpoints. Patients in this trial received excellent standard of care, with high rates of background medicines including the highest rates of SGLT2s seen in any IgAN study. Baseline characteristics were well matched to real-world IgAN patients in terms of age, renal function, and degree of proteinuria. In addition, as a measure of study quality, it is important to look at discontinuations. In this study, treatment discontinuations were low, and trial discontinuations were even lower at a rate of 1.5% in the placebo group and 0.8% in the Povi group. To replay the top-line primary and secondary efficacy results: for the primary endpoint, Povi achieved a 52% reduction from baseline in proteinuria as measured by 24-hour UPCR. That is a 49.8% reduction versus placebo. For the first secondary endpoint, Povi treatment led to a 77.4% reduction from baseline in serum GdIgA1 levels. That is a 79.3% reduction versus placebo. For the second secondary endpoint, of those patients with hematuria at baseline, 85.1% of Povi-treated patients achieved hematuria resolution, which is a 61.7% reduction versus placebo. In addition, 42.2% of patients reached the exploratory endpoint of 24-hour UPCR of less than 0.5 g/g, an important clinical threshold. These are remarkable results, and particularly noteworthy considering that at the time of the interim analysis, patients had received just 36 weeks of Povi treatment. On safety, Povi was generally safe and well tolerated. The majority of adverse events were mild to moderate, and there were no serious adverse events related to Povi. Importantly, in terms of infections, most were mild to moderate. The rate of SAEs of infection was low at 0.5%, observed in both the placebo and Povi groups. There were no opportunistic infections and no discontinuations related to Povi overall, including no discontinuations due to infections. Lastly, on anti-drug antibodies or ADAs, ADAs were observed as expected with biologics but had no impact on Povi's efficacy or risk profile. We look forward to sharing more details of the interim analysis results and anticipate doing so at upcoming medical meetings this fall. Shifting to Povi in primary membranous nephropathy, I am pleased to share we have completed enrollment of the Phase II portion of the OLYMPUS Phase II/III study and have already initiated the Phase III portion, ahead of our previously announced mid-2026 goal. And finally, on Povi as part of its pipeline and product potential for B cell–mediated diseases beyond renal, I am also pleased to share that the Phase II proof-of-concept study of Povi in generalized myasthenia gravis is underway. This is a 30-patient study of people with gMG, evaluating both the 80 mg and 240 mg dose for 12 weeks with the primary endpoints of safety and the percent change from baseline in IgG at week 12. The rationale for studying Povi in myasthenia is compelling. It is a serious B cell–mediated disease with high morbidity affecting approximately 175 thousand people in the U.S. and Europe. There is high unmet need as current therapies have meaningful limitations, which means there is room for improved efficacy, a better benefit-risk profile, and more patient-friendly dosing and administration, which we have discussed in the context of IgAN as being critically important when considering a chronic biologics market. We believe Povi's mechanism of action, striking at the heart of autoantibody production with an engineered protein format, provides best-in-class promise in myasthenia; we are excited to develop this opportunity. Shifting back to renal to finish up with enaxaplin in APOL1-mediated kidney disease or AMKD. First, on AMPLITUDE, the pivotal Phase III study of primary AMKD, that is to say patients with two APOL1 variants, PND, and no other renal-related comorbidities, we are on track to conduct the interim analysis, which occurs after 48 weeks of treatment, and to share data from this cohort in early 2027. If positive, we will be poised to file for potential accelerated approval in the U.S. thereafter. Second, on AMPLIFIED, our Phase 2b study of enaxaplin in separate populations—patients with two APOL1 variants, modest proteinuria, and no other kidney disease, and patients with two APOL1 variants, moderate to severe proteinuria, and a second disease, type 2 diabetes, that could impact the kidney—these two populations are not being studied in AMPLITUDE. We recently completed enrollment in the AMPLIFIED study, which is a study of 13 weeks in duration. Given the clear differences in these populations, we made the decision early on to study them in separate trials. Emerging data in the field confirmed the wisdom of this decision. We are excited to learn from the AMPLIFIED study and look forward to sharing results in the second half of this year. Finally, on type 1 diabetes, a reminder that zamylosel has very strong clinical results to date, as detailed in last year's New England Journal of Medicine. Among patients who received a full dose and had at least one year of follow-up, 10 out of 12 patients were insulin free. These results are unprecedented and are particularly noteworthy given that these patients are those with 20-plus years of type 1 diabetes, undetectable endogenous insulin production at baseline, taking 40-plus units of exogenous insulin per day, and with two or more severe hypoglycemic events per year despite best available care. You may recall that in the second half of last year we paused dosing of the Phase I/II/III study in order to conduct a manufacturing analysis, which we have now completed. I am pleased to report that dosing in the study has resumed and multiple patients have been dosed. With dosing now restarted, we will update you in the coming months on the revised timelines, study completion, and regulatory filings. With that, I will turn the call over to Duncan for a commercial update. Duncan J. McKechnie: Thanks very much, Reshma. I will start with 6% globally, balanced nicely between U.S. growth of 5% and international growth of 8% in Q1. Global growth reflects continued AlifTrack uptake as its once-daily dosing and improved sweat chloride profile continue to resonate with the clinical and patient communities. As mentioned, AlifTrack has now surpassed $1 billion in cumulative global revenue since its approval in the U.S. in late December 2024 and Europe in July 2025. Outside the U.S., we have signed reimbursement agreements in 11 countries for AlifTrack in Q1 alone, building on the access generated in the second half of last year. The tremendous scientific and regulatory achievements represented by the label expansions for AlifTrack and TRIKAFTA also represent a meaningful incremental commercial opportunity of 800 people in CF who are newly eligible in the U.S. This broad labeling is one of several key CF growth drivers for the remainder of 2026, along with the global rollout of AlifTrack, treating younger patients, and expanding into additional geographies. We have worked closely with the CF population for two decades and remain focused on continuing to serve the CF community and expand our leadership across all genotypes, age groups, and geographies. Shifting to heme, the rollout of Kasjevi continues to gather momentum across all three regions, and I am pleased to highlight another significant commercial milestone since launch. Over 500 patients have now initiated the KASJEVY treatment journey. Hundreds have had their first cell collection, and many patients have had their cells edited and are ready for infusion. During the first quarter, we delivered $43 million in KASJEVY revenue. Importantly, we worked on securing a pricing agreement for KASJEVY in Germany in Q1 and are currently working through the implementation steps. This is a historic moment, and we are excited that German patients with sickle cell disease and TDT may soon be benefiting from long-term access to KASJEVY at a sustainable price. Overall, we are very encouraged by the robust flow of patients in the U.S., in Europe, and the Middle East moving from referral to cell collection and infusion. First-quarter revenue reflects expected variability quarter to quarter as patients choose the timing for their infusion that suits them best. For the full year 2026, the Kasjevi outlook is very promising, as we have built our ATC network, secured reimbursements, and now have many patients at all stages of the treatment journey. We therefore have very strong visibility to revenue for the rest of 2026, for KASJEVY to contribute meaningfully to our $500 million-plus revenue goal for non-CF products this year and towards KASJEVY's ultimate multibillion-dollar potential. For Gernavix in moderate to severe acute pain, prescriptions, prescribers, and awareness all continue to build. More than 350 thousand prescriptions were filled in the quarter, compared to approximately 550 thousand in all of 2025, which was in line with our expectations. We also surpassed the milestone of over 1 million Gernavix prescriptions written since launch. Prescriptions this quarter were once again split roughly 50/50 between the hospital and retail channels and generated $29 million in revenue, also in line with our expectations. Overall, prescription growth remains strong, although Q1 revenue reflects some normal inventory destocking. We remain on track to more than triple the 550 thousand prescriptions from 2025, and for revenue growth to significantly exceed prescription growth. I will now outline some of the key drivers of our continued growth and expected success for Gernavix in 2026. Firstly, physician and patient clinical experiences on Gernavix continue to be excellent, which provides a great foundation for continued growth. We also continue to see outstanding breadth of physician uptake, as well as Gernavix additions to hospital and IDN formularies, protocols, and order sets. Secondly, we continue to make good progress in the payer space: 240 million lives now covered. In addition to the big three commercial PBMs, I am delighted to announce that we have reached an agreement with the first of the big four Medicare Part D plans to start covering Gernavix effective as of May 1. Given the multiple and well-documented challenges that opioids present seniors, this is welcome news, and we are in discussions with the remaining Medicare Part D plans as well as the smaller regional plans. Thirdly, we have completed doubling the size of our field force to 300 representatives, slightly ahead of plan. As we have communicated before, Gernavix is highly promotionally responsive, and we are excited about the impact of this new field team on Gernavix growth. Lastly, we also continue to execute multiple initiatives to drive awareness, growth, and provide new mechanisms for patient access, including the launch of Vertex Pharmaceuticals Incorporated's first direct-to-patient telehealth-informed pain care. This platform is accessible from genavix.com and provides appropriate and independent telehealth evaluations for nonsurgical acute pain patients, if eligible. We are also pleased that Gernavix was recently added to the list of non-opioid medicines eligible for separate payments under the NO PAIN Act, effective retroactively to January 2023. In summary, with the increased size of our field organization, our continued progress in securing payer and hospital coverage, as well as strong gains in formulary status, we remain confident we will triple prescriptions for Gernavix in 2026. In addition, our strong reimbursement progress continues to position us to taper our patient support program over the course of 2026 and enter 2027 with a normalized gross-to-net. We continue to expect Gernavix to contribute meaningfully to the $500 million-plus we expect in revenue outside CF this year. I will conclude with an update on the commercial initiatives for our emerging renal business. We are investing in the nephrology community for the long term, and povitacicept is the first in a series of potentially transformative medicines that tackle the underlying cause of four serious renal diseases—namely IgA, PMN, AMKD, and ADPKD. We were thrilled with the interim analysis results of the RAINIER Phase III study, with excellent results across the board in efficacy, safety across all subgroups, and in the areas of greatest interest to nephrologists and patients. The results create a superb foundation for the commercial launch of a potentially best-in-class medicine. Our goal for povitacicept is to be physicians' first choice for their IgAN patients, given Povi's compelling trifecta of differentiated efficacy results, well-tolerated profile, and patient-centric administration characteristics due to its low volume, monthly dosing via subcutaneous auto-injector. Based on our market research and discussions with nephrologists, plus feedback from our field team engagements, we know nephrologists are looking for treatments in IgAN that meaningfully and rapidly reduce proteinuria in the patients they treat, as they see proteinuria as the key indicator of where the patient is headed. Nephrologists also seek a favorable tolerability profile, and both physicians and patients communicate to us the need for a seamless treatment experience, which includes everything from access to patient support to monthly dosing, size of dose, and administration in an auto-injector. We believe that, uniquely, Povi has the clinical profile, and that Vertex Pharmaceuticals Incorporated has the capabilities to meet all of these needs. Our renal field force will be specialty-sized and large enough to cover nephrologists who see approximately 80% of U.S. IgAN patients. We will target key facilities that represent a combination of renal centers, glomerular disease clinics, and key high-volume private practices. Our payer conversations are proceeding well. In a U.S. market, approximately 70% of patients have commercial coverage. We have a proven track record in securing broad and rapid access for our medicines and plan to establish the same for Povi in IgAN. And lastly, we know that the quality of the patient support provided is critical in the biologics space. With that in mind, Vertex Pharmaceuticals Incorporated programs to support Povi patients will enable speed to therapy and personalized support through the treatment journey, delivering a seamless experience of onboarding for patients and physicians alike. Povi in IgAN is the first component of our emerging renal franchise. We are excited to bring it to nephrologists and their patients. Based upon our work with them, we know they are excited to try it as well. We believe Povi delivers exactly what nephrologists are looking for in IgAN, and just as we have done for over a decade in CF, Povi's success will be driven by a field force delivering a high-science sell, fueled by a potentially best-in-class product, broad reimbursement, and robust and high-quality patient programs. We are very excited to begin building our fourth commercial pillar and creating another multibillion-dollar franchise at Vertex Pharmaceuticals Incorporated. I will now turn the call over to Charlie to review the financials. Charles Wagner: Thanks, Duncan. As Reshma noted, Vertex Pharmaceuticals Incorporated's Q1 2026 results demonstrate our consistent strong performance and attractive growth profile. First-quarter 2026 total revenue increased 8% year over year to $2.99 billion. CF revenue grew 6% year over year, and new disease areas also contributed, with KASJEVY delivering $43 million and GERNAVICS $29 million in Q1 sales, representing about 25% of total year-over-year growth for the quarter. By region, U.S. revenue growth of 7% year over year was driven by continued steady performance in CF and growing contributions from KASJEVY and GERNAVICS. International revenue grew 9% year over year, driven by continued CF expansion and increasing contribution from KASJEVY and, as anticipated, a benefit from year-over-year changes in foreign exchange. First-quarter 2026 combined non-GAAP R&D, acquired IPR&D, and SG&A expenses were $1.29 billion, an increase of 5% compared to $1.23 billion in 2025. Within total OpEx, non-GAAP R&D expenses were down 2% year over year, partly driven by the timing and mix of certain clinical trial expenses. In addition, certain Povi manufacturing expenses were included in R&D in 2025 and are now recorded in cost of sales following the positive interim analysis data. Non-GAAP SG&A expenses increased 30% year over year, driven primarily by commercial investments—roughly 40% attributable to GERNAVICS in pain and approximately one third to renal launch programs. We also recorded $1 million in IPR&D expense in the quarter, compared to $20 million in 2025. First-quarter 2026 non-GAAP operating income was $1.31 billion compared to $1.18 billion in non-GAAP operating income in 2025. First-quarter 2026 non-GAAP effective tax rate was 19.6%. First-quarter 2026 non-GAAP net income was $1.1 billion, an increase of $93 million compared to 2025, primarily due to increased product revenue, partially offset by increased operating and income tax expenses in 2026. First-quarter 2026 non-GAAP earnings per share were $4.47 compared to $4.06 in 2025, reflecting our strong revenue growth and disciplined expense management. We ended the quarter with $13 billion in cash and investments after deploying approximately $344 million to repurchase more than 741 thousand shares in the first quarter. This activity reflects our ongoing commitment to returning value to shareholders while maintaining the flexibility to act on strategic growth opportunities. Overall, our priorities for cash deployment remain unchanged, with a primary focus on investing in innovation. Now switching to guidance. We are reiterating our 2026 total revenue guidance of $12.95 billion to $13.10 billion, representing growth of 8% to 9%. This outlook reflects continued solid performance from the CF franchise driven by the AlifTrack launch, expansion into younger patient groups, incremental patients from the label expansion, and geographic expansion. We continue to have high confidence in our outlook for revenue of $500 million or more from non-CF products, driven by growing KASJEVY infusions—we have good line of sight given the length of the patient journey—and a meaningful ramp in GERNAVICS prescriptions and revenue as gross-to-net normalizes through the second half of the year. Lastly, our revenue outlook continues to include an expected impact from foreign exchange, net of our hedging program. Our outlook for full-year gross margin remains at just under 86%, reflecting the growing non-CF product mix impact and ongoing investments in manufacturing network and process development for various products. We are also reiterating our combined non-GAAP operating expense guidance of $5.65 billion to $5.75 billion, reflecting continued investment in our late-stage clinical pipeline, commercial infrastructure, and activities for new launches and revenue diversification. We also continue to expect our non-GAAP effective tax rate to be in the range of 19.5%–20.5% for the full year 2026. On the subject of tariffs, we do not expect any material impact to the income statement in 2026. We continue to evaluate the details of recent announcements and the potential applicability to Vertex Pharmaceuticals Incorporated. In summary, Q1 2026 was a very strong start to the year. Financial results are on track, commercial launches and diversification are gaining momentum, and we continue with targeted investment both in innovation and commercialization as the pipeline is advancing across our multiple disease areas. Our increasingly diversified commercial portfolio, now spanning three disease areas and soon to be four—the establishment of the renal franchise—is driving new revenue streams and adding to our near- and long-term growth profile. Vertex Pharmaceuticals Incorporated is well positioned to continue expanding its impact for patients, investors, and all stakeholders. These and other anticipated milestones of continued progress in multiple disease areas are detailed on slide 17. We look forward to updating you on our progress on future calls. I will now ask Susie to begin the Q&A period. Susie Lisa: We will now open the call for questions. To ask a question, you may press star then 1 on your touch tone phone. If you are using a speakerphone, please pick up your handset before pressing the keys. To withdraw your question, please press star then 2. Our first question for today will come from Jessica Fye with JPMorgan. Please go ahead. Jessica Fye: Hey, guys. Good afternoon. Thanks for taking my question. So you have talked about renal one day rivaling the cystic fibrosis business in size. Can you speak to what needs to play out from here to realize that vision? And among your renal assets, which you see having the greatest long-term revenue potential? Thank you. Reshma Kewalramani: Jess, this is Reshma. I guess, as the nephrologist at the company, maybe I can take this, and, Duncan, please feel free to add. So, Jess, what we are talking about in our emerging renal franchise is four assets—Povi for four diseases—three assets: Povi for IgAN, Povi for membranous, enaxaplin for AMKD, and what we call VXS-407 in ADPKD. The reason I think that this has the potential to be as big if not larger than CF is that the diseases that these medicines treat are rare diseases, but they are common rare diseases. And when you add them all up together, they are well into the hundreds of thousands of patients. For example, we talk about 150 thousand or so patients with IgAN in North America and Europe, 100 thousand patients with membranous in the same geographies. For AMKD, that is another 150 thousand or so patients with the AMPLITUDE population, not including the AMPLIFIED population, which adds another 100 thousand, and ADPKD is about 300 thousand patients. Of course, the first medicine that we are studying, VX-407, can treat about 10% of that 300 thousand. So, one, while each one is a rare disease, they are common rare diseases, and when you add it together, we are hundreds of thousands of patients in just the Western world. The second is that in renal medicine, unfortunately, the natural history of these diseases is a relentless decline in renal function, and a movement then to death, dialysis, and transplantation. Obviously, those are enormous burdens for society. I do not need to say much more about death, but dialysis in particular is exceptionally expensive. And while it allows you to live, it is a very, very difficult life, and life expectancy is like very serious cancers like pancreatic cancer. And then last of that block, when we look at the emerging results for Povi, for example, in IgAN and membranous, you can look at the Phase II, and for IgAN, you can certainly look at the Phase III interim analysis results. As I said in the call, they are sparkling. From top to bottom, safety, efficacy—these are the kind of medicines that can bring transformative value. When I think about AMKD, same thing. You look at the Phase II results that we published in the New England Journal—47.6% reduction in proteinuria is a very big deal. And when we think about ADPKD, no human results yet, but when you look at the mechanism of action—this is to say to properly fold the misfolded PC1—and what we see preclinically, another one where we think transformative effect. That is why we believe this is another vertical that can rival, if not crest, CF. Best renal asset—that is a tough one, Jess. I am going to focus my attention for the here and now on Povi. It just looks sparkling. You can call it near-term bias because we just looked at the Phase III results. Jessica Fye: Thank you. Operator: The next question will come from Salveen Richter with Goldman Sachs. Please go ahead. Salveen Richter: Good afternoon. Could you discuss the read-through from MACE's recent data to the enaxaplin program? And also, could you just speak for that program, whether there were enrollment considerations to enrich for patients with larger APOL1 contribution to CKD, especially in the non-FSGS patients? Thank you. Reshma Kewalramani: Yes. Hey, good afternoon, Salveen. On the MACE data, you know we do not like commenting on other companies' assets and results, but I will simply say the top line: the Vertex results were 47.6% reduction in proteinuria, as published in the New England. And my recollection is the MACE data is 35.6% at the top line. Going below that is difficult because we are talking about groups of two and three patients with or without diabetes and such, and I just do not think you can make very much when you are down to two or three patients. What I will say is I am very happy about the decision we made early on to not mix a heterogeneous group, and to focus our program on those with heavy proteinuria, two APOL1 alleles, and reduced kidney function, and not study those who have a comorbid condition like diabetes. Instead, what we did is study those people in a separate trial called AMPLIFIED along with a group of patients with lower proteinuria. That trial is done enrollment; I do expect to have results in the second half of this year. Operator: The next question will come from Brian Abrahams with RBC Capital Markets. Please go ahead. Brian Abrahams: Hey, guys. Thanks so much for taking my question. With the Povi launch not too far off, what do you think you will need to convey to KOLs and community physicians to convince them of povitacicept differentiation and overcome first mover advantage by competitors? Thanks. Reshma Kewalramani: You bet, Brian. Let me ask Duncan to take that. He has been spending a lot of time with nephrologists both in academic institutions and centers of excellence, as well as in the community. Duncan? Duncan J. McKechnie: Brian, good afternoon. So, one comment before we dive into your answer. I just made the point that, obviously, this is a huge market opportunity with about 160 thousand patients in the U.S. It is five times bigger than CF, for example. And the vast majority—about 75%—of those patients are nowhere near the KDIGO guideline goal in terms of proteinuria. So the opportunity is significant. We have been engaging through market research and other mechanisms with many nephrologists, and essentially they tell us they are looking for a product that significantly impacts proteinuria—we will come back to that—is well tolerated, and is easy for patients to use. And we believe that povitacicept uniquely meets those needs. We think it has the sort of winning trifecta of incredible clinical effects—as you heard in the prepared remarks, things like the rapid, deep, and sustained reduction in proteinuria, as well as GdIgA1 and hematuria—it has a supremely favorable tolerability profile and very attractive dosing and administration. So, as you know, it is once a month, it is a small-volume dose, it is delivered by an auto-injector. So we think we have an incredible product, as we saw in the clinical data. We also know from our market research that those nephrologists that distinguish between BAFF/APRIL and APRIL alone, the vast majority of them preferred dual inhibition with BAFF and APRIL. And in our patient market research, the vast majority of patients prefer monthly dosing over weekly dosing. In fact, eight times more patients prefer monthly dosing to weekly dosing. So, in terms of the profile of the product matched against the need of the physicians and patients, we think we have a best-in-class asset on our hands. And I would also add on the commercial capability side, we know how to execute a high-science sell, we know how to secure rapid, deep, and broad reimbursement, and we know how to build patient support programs, which are incredibly important in the biologic space as we have done for the last 12–13 years or so in cystic fibrosis. So we are feeling really good about the profile of povitacicept. We are getting ready for launch, and we are going to be ready to go the day the FDA gives us regulatory approval. Operator: The next question will come from Geoffrey Meacham with Citi. Please go ahead. Geoffrey Meacham: Afternoon, guys. Thanks so much for the question. I have two quick ones. So on pain and on 993 in particular, as you guys have got commercial experience with Gernavix, are there settings where an IV modality is perhaps a better fit in the clinical practice? I imagine that is maybe the hospital setting in the acute. I wanted to get your perspective. And then on Povi, congrats on the quick filing in IgAN, but looking beyond PMN and gMG, is it worth it to do a basket study? Are there other autoimmune indications where you could have the most differentiation for Povi and then maybe have the highest probability of success? Reshma Kewalramani: Hey, Geoff. This is Reshma. On the pain portfolio and whether or not an IV medicine would be helpful: I think it would be helpful to have an IV medicine, and what we are really looking to do here—and the reason we have not only suzetragene or Gernavix, but 993 and additional Nav1.8, but, very importantly, Nav1.7—is to make sure that we have the best medicine, whether it is PO or IV, and that formulatability into IV is one of the features that we are looking at and are interested in. Switching then to Povi and where we see things go, IgAN is already done in terms of the interim analysis and filing. Membranous Phase III is already underway. Myasthenia Phase II is underway. There are some additional B cell–mediated diseases that we are thinking about, and I do think a basket study is a very efficient way of evaluating those conditions through Phase II development. I will not say much more about exactly which conditions, but suffice it to say, there are some B cell–mediated conditions where autoantibodies are important, where we think Povi would fit nicely. And I do think that going about this by way of basket studies and efficient Phase II/IIIs are the right way to go. You will be hearing us talk more about Povi, our immunology portfolio, in the coming months and in the coming times. But I like your idea. Operator: The next question will come from Cory Kasimov with Evercore ISI. Please go ahead. Cory Kasimov: Hey. Good afternoon, guys. Thanks for taking my question. I wanted to follow up on Salveen's question on enaxaplin. When you think about the pending data from AMPLIFIED looking at AMKD patients with moderate proteinuria or diabetes, what is needed in this population for a clinically meaningful benefit to justify advancement in this patient segment? Thank you. Reshma Kewalramani: I would say that, generally speaking, in renal, we have been thinking about double-digit improvements as being valuable. By that, I do not mean 10% or 11%. I would say if we can show a 30% improvement—some number between 20% and 40%, 25% and 50%—some solid double-digit improvement in proteinuria on top of standard of care, of course—so, on top of ACEs, ARBs, SGLT2s, etc.—that would be meaningful. And we will be able to see how we fare shortly. The enrollment is done. It is a 12-week study. We will be able to tell you the results in the near term. Cory Kasimov: That is very helpful. Thank you, Reshma. Reshma Kewalramani: You bet. Operator: The next question will come from Michael Yee with UBS. Please go ahead. Michael Yee: Hey. This is Mike Yee from UBS. On Povi, do you believe that on the efficacy standpoint your differentiation on eGFR will be able to come through over 9 or 12 or 24 months versus, say, Otsuka, which I think is presenting their eGFR 9-month data next month and then their 2-year data coming up? And then I just wanted to think about where you would start to see differentiation for yours and a read-through to their data that they are going to present. And then on the safety component for Povi, Reshma, can you talk a little bit about the hypogammaglobulinemia? I think there are some questions around whether 150 or 300 matters, and then noise within the assay and the timing of the measurement, and why you do not think that would be any issue here for Povi? Thanks. Reshma Kewalramani: Yes. I will start with safety on hypogammaglobulinemia, and then we will go to efficacy. On safety, the results are really terrific because Povi—and any medicine that works on APRIL or BAFF/APRIL, in essence, is modulating B cells—you do need to think about the safety profile, and in the safety profile, the domain to think about is infection. So specifically, what we focused on and what I was very pleased to see is we can get this level of efficacy on proteinuria, on hematuria, on GdIgA1, on getting down to these very low levels—less than 0.5 g/g, which is the important clinical threshold—we can get down to those levels with a very favorable safety profile. So, on infection: most of the infections are mild to moderate—think upper respiratory infection. There are no opportunistic infections, no uncommon infections. The SAEs of infection are low and balanced; it is exactly 0.5% in the placebo group and the same exact number in the Povi-treated group. So that looks really nice. With regard to the actual immunoglobulin levels—and let us focus on IgG—the IgG thresholds of less than 300 or 200; some people use 400. These thresholds are important because that is how people set up their trials, and that is how the trials may have certain actions taken. You are correct: each trial defines a different threshold; you measure it a different number of times. Some people measure it monthly like us; other people measure it quarterly. Some people require multiple measurements to call it less than that threshold; others require a simple one level. So it is not very easy at all to cross-compare. The important thing, though, Michael, is if you are asking me, “Hey, is there anything there that gives you concern?” None at all. The important thing to look at is the infections, and the infections look very balanced between these groups. On efficacy, you ask about eGFR, which is the regulatory-enabling endpoint, right? So the regulators have said proteinuria is acceptable at nine months for accelerated approval, but they are looking for two-year eGFR for full approval. Note, however, eGFR is actually not the hard endpoint in renal medicine. The hard endpoint is death, dialysis, or transplantation. That is what we are really trying to avoid. It is just that that endpoint takes a long time, and so the acceptable regulatory-enabling endpoint for full approval is eGFR. The reason I think that the proteinuria is so important is when you think about that hard endpoint of death, dialysis, and transplantation, which takes years to develop, the thing that most proximally reflects that is proteinuria. And what I would do is think about proteinuria—okay, if I got one point of proteinuria improvement more than any other medicine, two points, five points, 10 points—compound that over years, and you start to see why proteinuria is so very important. The agency has said very clearly that we are not allowed to share eGFR, but they have equally said that they need to see eGFR to provide accelerated approval. So what I would say is any medicine in IgAN that gets accelerated approval has the proteinuria that we have already shared and has an eGFR that the agency finds comforting. Michael Yee: Yep. Thank you. Operator: The next question will come from Tazeen Ahmad with Bank of America. Please go ahead. Tazeen Ahmad: Hi, good afternoon. I wanted to ask what your thoughts are on the read-through from this positive IgAN study that you provided top line for recently onto the PMN study that you are currently running for Povi? And then secondly, on the CF pipeline, I just wanted to get a sense of what data you plan on showing in the second half of the year for 828, and what would be considered good data there? Thanks. Reshma Kewalramani: Let us do IgAN first. Tazeen, I see some data from the IgAN as very important and positive for membranous because now we have studied hundreds of patients over a nine-month period, which is additive information to the Phase II results. So things like PK, PD, the reduction in proteinuria—I see all of that in terms of efficacy as important. Clearly, the autoantibody of interest is different. One is PLA2R—that is what we are looking for in membranous—versus GdIgA1. So that has to play itself out. But in terms of those other parameters, I see that as really positive. The other variable that I see as very positive is on safety. The fact that there is such a favorable safety profile, I see as a positive. Of course, the IgAN study was at 80 mg, and in the membranous study, we are studying both 80 mg and 240 mg to pick one. Last, I feel very good about the way the study is being conducted. That is to say, low discontinuations in terms of study discontinuations and treatment discontinuations. I also feel really good about the background therapy. It is very important to look at as you think about doing these studies in contemporary practice. On CF, the 828 results are a CF cohort after we have completed the healthy volunteer study, and so what you should see is data from the single dose that has gone into the patient cohort, and you should expect to see sweat chloride results and safety results as well. It is a small cohort, so you should not expect anything on ppFEV1. But the readout—the efficacy readout—that we are looking for is sweat chloride. So you should expect us to share that. Operator: The next question will come from Evan Seigerman with BMO. Please go ahead. Evan Seigerman: Hi, thank you so much for taking my question. I want to expand a little bit on the discontinuation of VX-522. Anything else you can share on the tolerability issues? And then, looking ahead, do you plan to utilize another technology to help these patients that are not currently treatable with your current portfolio? Thank you. Reshma Kewalramani: Good afternoon, Evan. On VX-522, what I can tell you is that the tolerability issue that we have been monitoring and sharing with you, now that the study is being discontinued, has to do with lung inflammation—an inflammatory response, probably in response to the LNP that is being used to deliver it. And I say that because this is not unusual in that regard. So, with regard to what are we going to do for our patients, I want to be clear about the fact that our commitment to CF is absolute and steadfast. If there is any more that we can do for our patients in the 95% group, we are going to be the ones who do it. And for our last 5,000 or so patients, we are going to work on that as well. I expect that the challenge is going to continue to be delivery. And in terms of modalities, we are going to have to go back to the drawing board on modalities. These last 5,000 are going to require some nucleic acid therapy, right? Because they simply do not make any protein. And so the big question is not necessarily what the nucleic acid therapy is—I have some big ideas, and they are, I think, obvious—but how do you deliver it without having this lung irritation? And that is what we are going to be working on. Evan Seigerman: Great. Thank you. Operator: The next question will come from David Risinger with Leerink Partners. Please go ahead. David Risinger: Thanks very much and thanks for all the updates. So my questions are on GERNAVICS. Could you maybe help reconcile the $29 million in revenue in the first quarter with the volume of either prescriptions or pills? And then, given that GERNAVICS has PBM coverage for 240 million lives now, which is over two thirds of the population, does GERNAVICS need to achieve more employer opt-ins and more Tier 2 formulary positions for the gross-to-net to normalize? Thanks so much. Reshma Kewalramani: Duncan, do you want to take that one? Duncan J. McKechnie: Sure. Good afternoon, David. So in terms of the first part of your question, I would say overall, by the way, we are extremely pleased with the progress on GERNAVICS. We are fully on track in terms of our prescription numbers and our revenue numbers. In terms of reconciling Q1 and volume, as I mentioned in the prepared remarks, we did see a small but relatively normal channel inventory destocking in Q1 between Q4 2025 and Q1 2026. It is also true that in that quarter, of course, Medicare Part D plans are resetting, which can lead to higher co-pays and more abandonment. And then also, we saw the traditional reduction in the number of elective surgeries in January, which were a little bit harder impacted this year because of the fairly strong flu season. So overall, I would say that the Q1 performance was in line with our expectations. We are absolutely on track to more than triple the number of prescriptions that we delivered in 2025. And to answer the second part of your question, we have just achieved our 240 million lives covered. As you know, we are very happy with that. And actually, in an update since we finalized the script—you know that we have been working on four Part D plans, and in the script, we communicated that we had secured coverage at one of those four plans—we have actually secured coverage at two of those four plans and are very close to securing coverage at a third of those plans. That coverage starts from between May 1 to July 1. So I do not think we need to be focused on downstream plans and employer plans. As we have said all along, as we secure the final pillars of access, the patient support program will taper down, our gross-to-net will normalize by the end of the year, and you will see revenue significantly accelerate and accelerate faster than prescription growth as we go through the balance of the year. David Risinger: Thank you. Operator: The next question will come from Terence Flynn with Morgan Stanley. Please go ahead. Terence Flynn: Great. Just two questions for me. I was just wondering if you can tell us if there is a defined percentage of FSGS patients in the AMPLITUDE Phase III trial for enaxaplin—if there is a cutoff, or if you are just pretty much all comers and that mix will be dictated by who is enrolled. And then for AlifTrack, just curious to know if you are seeing anything different in terms of patient mix this quarter versus prior quarters in terms of the three different buckets that you guys have focused on? Thank you. Reshma Kewalramani: Terence, I will take your FSGS question for Phase III enaxaplin, and I will turn it over to Duncan. I will not be able to share what the baseline characteristics look like because we have not looked at those data, and we do not know those data. But what I will tell you is that what is common in AMKD is because they tend to be heavily proteinuric—so we are talking about people who are coming in with proteinuria 0.7 g or more—they often tend to have a biopsy because a lot of proteinuria and people are trying to figure out whether there is an underlying identified cause. So it would not surprise me at all if many—maybe even the majority—of patients in the AMKD Phase III AMPLITUDE trial actually were known FSGS patients because a lot of these patients do get a biopsy. Not all of them, but it is not an uncommon act. So that would be my guess, but I do not have a formal answer for you. Fortunately, the IA enrollment is complete, the full study enrollment will complete this year, and we fully expect to have results from the IA in early 2027. So we will know the answer real soon. Duncan? AlifTrack characteristics—transition? Duncan J. McKechnie: Yep. Terence, thank you for the question. So I am assuming the three categories you are talking to are the naïve patients, the discontinued patients, and the transition patients. I would say that we see continued strong progress in all of those. Once we have both regulatory approval and reimbursement, we see the naïve patients coming on first, then we see discontinuation patients coming on, and then finally the transition patients moving on to AlifTrack, indeed exactly as we desire. So at this point, essentially, I would tell you that all new patients are going on to AlifTrack—no one is going on to TRIKAFTA—all going on to AlifTrack. We see the discontinued patients largely moving on to AlifTrack, and the vast majority, of course, of our patients now are transitions from TRIKAFTA to AlifTrack, exactly as we would expect. So the three drivers really of AlifTrack growth this year are continued uptake in the U.S., more European countries securing reimbursements, and the expanded labels—for example, the additional 800 patients that were recently included in the most recent labeling updates. So hopefully that answers your question, but we are seeing essentially similar profile to that which we saw before, and super happy that we are well over $1 billion on AlifTrack at this point. Jessica Fye: One more question, please, Chuck. Operator: The next question will come from Analyst with Barclays. Please go ahead. Analyst: Just on 828, just to follow up on the earlier question. I guess, what are you seeing as a bar for what you would want to see to bring this forward from an efficacy or safety perspective? And then, just as you think about the cystic fibrosis landscape overall, how are you thinking about the bar set by AlifTrack versus where you see room for incremental improvement? Thanks. Reshma Kewalramani: When we had TRIKAFTA and were working to see what the unmet need was, honestly, AlifTrack was a little bit easier to see. As amazing as TRIKAFTA is, we could see that a once-daily medicine would be better for patients. And we could see that getting more CFTR protein function—that is to say more sweat chloride improvement, more patients below the diagnostic threshold of 60 and the normal level of 30—would be advantageous. Now, fast forward to where we are today with AlifTrack, and, genuinely, there is very little unmet need. And so it is going to take something special for us to advance, and that is why we are looking at VX-828, VX-581, and VX-2272, because we want to really interrogate to see if there is more that we can bring to the table. And what I am really saying, if the event is unclear, is this: today, 90% of people—if you start at a young age, which AlifTrack is now approved down to 6 years old, and we are filing for 2–5 years old—90% are less than 60. Two thirds of our patients are in sweat chloride that is below normal. And this is with a once-a-day medicine. And now, when you think about it, everyone—as Duncan described—all our new patients, all our young patients, are coming onto AlifTrack. There is very little room for improvement here. So if it is possible, we are going to be the ones who do it, but it is getting really, really tough because we are already down to once a day, good-looking DDIs, excellent sweat chloride function with two thirds normal. It is tough. So if we see it, we will certainly let you know, but that is why we are being so particular in bringing these number of medicines forward to see if anything can be better than AlifTrack. Susie Lisa: This will conclude our question and answer session, as well as our conference call for today. A replay of today's event will be available shortly after the call concludes by dialing +1 (877) 344-7529 or +1 (412) 317-0088 using replay access code 10208180. Thank you for your participation. You may now disconnect.