PTCT

Ladies and gentlemen, thank you for standing by. Welcome to PTC Therapeutics' second quarter 2026 earnings conference call. All participants are on listen-only mode. After the presentation, there'll be a question and answer session. Today's conference is being recorded. I would like to turn the conference over to Ellen Cavaleri, Head of Investor Relations. Please go ahead.

Good afternoon, thank you for joining us to discuss PTC Therapeutics' second quarter 2026 corporate update and financial results. I'm joined today by our Chief Executive Officer, Dr. Matthew Klein, our Chief Business Officer, Eric Pauwels, and our Chief Financial Officer, Pierre Gravier. Today's call will include forward-looking statements based on our current expectations. These statements are subject to certain risks and uncertainties, and actual results may differ materially. Please review the slide posted on our investor relations website in conjunction with the call, which contains information about our forward-looking statements and our most recent quarterly report on Form 10-Q and annual report on Form 10-K filed with the SEC, as well as our other SEC filings for a detailed description of applicable risks and uncertainties that could cause our actual performance and results to differ materially from those expressed or implied in these forward-looking statements.

Additionally, we will disclose certain non-GAAP information during this call. Information regarding our use of GAAP to non-GAAP financial measures and reconciliation of GAAP to non-GAAP are available in today's earnings release. I will now pass the call over to our CEO, Dr. Matthew Klein.

Thank you all for joining today. I'm excited to share the results of another quarter of outstanding execution across the company. Starting with revenue, we achieved another record quarter with total revenue of $361 million, including $239 million of product revenue, driven by continued strong global Sephience sales. Based on this performance, we are raising our full year 2026 product revenue guidance to $850 million-$950 million and now expect total revenue of $1.18 billion-$1.28 billion. In addition, with our continued effective management of expenses, we remain in position to potentially reach the milestone of being cash flow breakeven in 2026. I'll begin with an update on Sephience's global launch. Momentum remains strong in the quarter, with continued steady growth in the U.S. and accelerating growth internationally.

Second quarter global Sephience revenue was $151 million, up 21% quarter-over-quarter, with the majority coming from the U.S. and increasing contributions internationally. As of June 30, we had 1,647 commercial patients on Sephience globally. We continue to see broad uptake across all patient segments and age groups worldwide. There remains strong underlying demand for Sephience, and our teams continue to effectively execute. In the U.S., we now have received prescriptions from 100% of the centers of excellence, as well as prescriptions from other centers not previously designated as centers of excellence. This breadth of penetration this early in the launch is impressive, we will now work to continue to penetrate deeper into these centers. We continue to see demand across disease severities and treatment histories, including treatment-naive patients, prior therapy failures, and those switching from existing treatments.

Adherence rates remain strong, we continue to hear reports not only of meaningful reductions in phenylalanine and increasing evidence of diet liberalization, but also of Sephience's benefits on mood, cognition, and quality of life. These dynamics of strong demand and reported patient benefit reinforce our confidence in Sephience's long-term commercial opportunity. In international markets, momentum for Sephience continues to build. Commercial sales in Japan began to ramp in Q2 following our first commercial sale in late March. We started expanded access programs in a number of European countries and have seen positive progress towards future revenue in Latin America, including Brazil, where Sephience recently received the highest classification for therapeutic benefit from the country's Drug Market Regulation Chamber. As we have previously shared, we expect international revenue to increasingly contribute in late 2026 and into 2027 as additional markets come on board.

Based on the continued strong launch momentum and the persistent strong underlying demand, we remain confident in the $2 billion-plus global commercial opportunity for Sephience. Turning to the votoplam Huntington's disease program, in April, we reported positive top-line results from the 24-month interim analysis of the PIVOT-HD long-term extension study. At month 24, votoplam demonstrated dose-dependent slowing of disease progression on cUHDRS, including an average slowing of 52% relative to natural history in the 10 milligrams stage 2 cohort. We continue to observe a favorable safety profile across doses and disease stages. These data support the potential for votoplam to provide long-term, meaningful clinical benefit for individuals affected by Huntington's disease. We also shared that Novartis has initiated enrollment in the global phase III INVEST-HD study, which is being conducted and funded by Novartis.

The study is expected to enroll approximately 770 individuals with early symptomatic disease, randomized 3:2 to receive votoplam 10 mg or placebo, the study includes an interim analysis. While the phase III study remains the base case for votoplam approval, The Novartis and PTC teams are finalizing a plan to engage with FDA in the second half of 2026 to discuss the 24-month results and potential accelerated paths. For the vatiquinone ataxia program, based on discussions with FDA, we have finalized a study protocol for the open-label trial with a natural history comparator arm to support NDA resubmission. We plan to initiate this study, PROVE FA, in the third quarter of this year. The trial will enroll approximately 120 individuals ages 7 to 21, the study primary endpoint is the change in mFARS from baseline to month 24.

The study design reflects the key learnings from our prior development work and has understandably generated enthusiasm within the FA community, particularly because it offers patients the opportunity to access therapy without the uncertainty of receiving a placebo. We believe the study design, coupled with our experience in FA therapy clinical development, meaningfully enhances the probability of success of the PROVE FA study and the potential to deliver an important new therapy for children and adults affected by FA. Shifting to our other clinical pipeline programs, we have initiated the phase I study of PTC612, our oral NLRP3 inhibitor, and have completed several of the single and multiple ascending-dose treatment cohorts. Notably, this healthy volunteer study will enroll a cohort of individuals with obesity and cardiovascular disease, which we expect will an early view of PK/PD effect.

As we have previously shared, PTC612 is differentiated from other NLRP3 inhibitors in terms of potency, selectivity, and chemical structure. Later in the third quarter of this year, we expect to initiate a phase II-A study of PTC844, our next-generation DHODH inhibitor. PTC844 is highly selective for the DHODH enzyme and benchmarks favorably to other DHODH inhibitors in preclinical potency models. The PTC844 study will be a 12-week PK/PD study in which we will assess treatment effect on biomarkers related to T-cell and B-cell immunity. The results of this study will help inform the ultimate target indications for PTC844. We have also made a number of advances in our splicing platform. We recently selected a development candidate for our MSH3 splicing program, PTC303. MSH3 is increasingly recognized as an important target for triplet repeat expansion diseases, including Huntington's disease and myotonic dystrophy.

As we have discussed, targeting MSH3 provides a complementary approach to HTT lowering in addressing the key pathological causes of Huntington's disease. The MSH3 program also further reinforces PTC's leadership in the discovery and development of oral small molecule splicing therapies. We expect it to be in the clinic in 2027. Overall, the company remains in a very strong financial position. In June, we strategically managed the 2026 convertible note liability with the refinancing of the majority of the existing notes at a 0% coupon and 40% conversion premium to the stock's closing price at the time of the deal. We closed the quarter with over $2.2 billion in cash and remain in position to achieve cash flow breakeven in 2026.

I'm proud of our team's outstanding performance in the first half of 2026 as we continue to make significant progress across the business. I'll now turn the call over to Eric to provide a commercial update, including additional details on the Sephience launch. Eric?

Thanks, Matt. In the second quarter, our commercial team continued the strong global launch of Sephience, driving solid product revenue and reinforcing confidence in our growth trajectory through 2026 and beyond. Launch momentum remained strong, supported by sustained contributions in the U.S. and increasing contributions from international markets. Now we have 1,647 patients on commercial therapy globally on Sephience. In the second quarter, Sephience revenue was $151 million, representing 21% growth over the first quarter of 2026. In the U.S., launch execution remained strong, with steady demand. As Matt noted, all U.S. centers of excellence are now prescribing Sephience, with adoption spanning the full spectrum of disease severity, all ages, including classical patients, and a broad mix of treatment backgrounds, including therapy-naive adults, prior treatment failures, and an increasing proportion of switches from existing therapies.

We are pleased to see persistent strong demand and to hear reports of the meaningful impact Sephience is providing children and adults on diet liberalization, as well as mood, cognitive improvements, and improvements in quality of life. With our increasing base of commercial PKU patients being treated with Sephience in the U.S., our customer-facing teams are focused on rapidly filling new prescriptions and successfully managing reauthorizations, refills, and providing exceptional patient support. Our customer-facing teams are dedicated to work closely with healthcare providers and the patient community to facilitate access to Sephience. These efforts will help support continued momentum and growth as we move further into the launch. Turning to our patient advocacy support, we had a strong presence at the National PKU Alliance Conference in Chicago earlier this month, where we focused on connecting with patients and caregivers and understanding their unmet needs.

At this meeting, we presented data from the AMPLIFY study demonstrating the ability of Sephience to reduce blood Phe significantly more than BH4, as well as new data on patients switching to Sephience in both pediatric and adult PKU populations. We also held several engagement events with patient advocacy groups, including a symposium emphasizing the extensive real-world data and examples of patients who, in addition to seeing important reductions in blood Phe levels, have also experienced significant improvement in their day-to-day quality of life on Sephience treatment. Internationally, launch momentum continues to build. In Japan, the early launch results are exceeding our internal expectations, with rapid uptake across many Japanese centers of excellence. We have secured pricing in Japan on par with the U.S., and importantly, this price is locked in for 10 years.

As we observed in the early stages of the U.S. launch, we are seeing broad uptake in Japan across disease severities and age groups, as well as treatment histories. In Germany, we continue to see strong momentum in the quarter, especially with an increase in newly prescribed adult and naive PKU patients, as our pricing and reimbursement discussions are continuing in the country. In other European markets, we are leveraging early access and named patient programs effectively and are seeing accelerated demand in France, Italy, and Spain. In other regions, including Latin America and the Middle East, we are similarly leveraging early access programs as we grow the Sephience global footprint and see important contributions to future commercial patients. While the U.S. remains an important near-term growth driver, we expect global revenue to become an increasingly meaningful contributor in the second half of this year and well into 2027.

As we discussed, there is a large addressable PKU population globally in markets where innovative treatments are reimbursed, we expect to bring Sephience to as many of these countries as quickly as possible, reinforcing our confidence in achieving a multi-billion dollar peak revenue potential. Looking ahead to our key event this summer, our team is preparing for a strong showing at the SSIEM meeting in Helsinki next month. This being the largest global metabolism meeting of the year. We have 17 oral and poster presentations planned that continue to showcase evidence of Sephience treatment benefit across the broad range of individuals with PKU based on new analyses of long-term trial data, as well as reports of real-world evidence.

Many of these presentations will highlight the positive impact that Sephience has had on PKU patients in countries around the world, with lower Phe levels leading to better diet, neurocognitive, and quality of life outcomes for these patients. Importantly, we plan to present new data demonstrating that treatment with Sephience responders led to a substantial portion of participants achieving complete normalization of blood Phe levels of 120 micromoles per milliliter in a rapid time frame, including those PKU patients who are classical and BH4 non-responsive. This impressive real-world data demonstrated that achieving Phe level normalization is an important key treatment goal for all potential PKU patients. Turning to our mature brands. In the second quarter, we continued to generate meaningful revenue despite challenges in the DMD franchise. For Translarna, we had continued sales in Europe and Latin America, as well as a government order from Russia.

In the U.S., Emflaza continues to see new prescriptions. Despite generic pressure, we see ongoing brand loyalty attributable in part to our programs and continued high-touch white glove services from our PTC Cares teams. In summary, our customer-facing teams delivered another strong quarter with another record revenue performance, once again demonstrating PTC's global rare disease commercial capabilities. We remain confident in our ability to grow and sustain our launch momentum of Sephience globally and firmly establish it as the standard of care for PKU patients. With that, I will now turn the call over to Pierre for a financial update. Pierre?

Thank you, Eric. I will now share the financial highlights of our second quarter of 2026. Beginning with top-line results. Total products and royalty revenue for the second quarter was $310 million. Total net product revenue across the commercial portfolio was $239 million, compared to $118 million for the second quarter of 2025, representing over 100% growth. Second quarter 2026 product revenue includes Sephience net product revenue of $161 million. DMD franchise revenue of $67 million. Translarna net product revenue was $42 million, including a government purchase order from Russia. Emflaza net product revenue was $25 million. For Evrysdi, Roche achieved second quarter global revenue of approximately $628 million, resulting in royalty revenue of $71 million.

For the second quarter of 2026, non-GAAP R&D expense was $89 million, excluding $11 million in non-cash stock-based compensation expense, compared to $104 million for the second quarter of 2025, excluding $9 million in non-cash stock-based compensation expense. Non-GAAP SG&A expense was $68 million for the second quarter of 2026, excluding $13 million in non-cash stock-based compensation expense, compared to $76 million for the second quarter of 2025, excluding $10 million in non-cash stock-based compensation expense. Cash, cash equivalents, and marketable securities totaled $2.23 billion as of June 30, 2026, compared to $1.95 billion as of December 31, 2025. In the second quarter of 2026, we repurchased the majority of our existing 2026 convertible notes and issued new convertible notes due in 2031 at 0% interest rate and a conversion price representing a 40% premium over the stock's closing price at the time of the issue.

Our strong financial position gives us the flexibility to pursue business development opportunities that support future growth while advancing toward cash flow breakeven and future sustained profitability. I will now turn the call over to the operator for Q&A. Operator?

Thank you. If you would like to ask a question, please press star one one. If your question has been answered and you'd like to remove yourself from the queue, press star one one again. Our first question comes from Kristen Kluska with Cantor. Your line is open.

Hi. Good afternoon, everybody, and congrats on a really strong quarter. I have a few Sephience questions. The first is, based on the patients on therapy and accounting for potential dropouts, my math is getting to about 10% or so of the patient population in the U.S. has tried the therapy. Curious if that matches what you think, and also what % of patients you think may at least be open to trying a therapy, not saying we'll get on it and assume peak penetration there. Second, just thinking about the conference circuit, you just came off the biggest one for the patients in the U.S., and now you have a big medical focus. What are really the key drivers there? Is it awareness? Is it proving that the therapy works across a breadth of patients? What are the key goals you hope to learn? Thank you so much.

Hi, Kristen. Thanks so much for the question. On the first question, look, I think the key take-home that we see this early in launch is we're incredibly excited about the demand and the uptake thus far. As you highlight, we still have a very long way to go, given the size of the population in the U.S. of 17,000 and the 58,000 patients we see in addressable markets worldwide. I think when we look to metrics thus far and we see penetration into 100% of the centers of excellence, that's really an incredible milestone this early, and it basically puts us in the position we want to be with a strong base of patients to now go deeper and deeper into those centers of excellence. Usually, at this stage of a launch, you're usually trying to get to all the centers of excellence.

We're there, now the task is to get deeper and deeper into those centers. In terms of overall patients who may try the therapy, I think the number we had always had is about 70% of individuals tried KUVAN. That again suggests we have a very large number of patients who are yet to try Sephience. We already know that we've seen patients who are therapy naive, that never tried KUVAN, that are in that other 30% bucket who are coming back to clinic. Again, it's hard to put an exact number on it other than to say we're still very early in this launch.

We've had strong momentum at the start, but we have a very long way to go in terms of continuing to get much larger number of patients to try the therapy and, of course, to stay on the therapy and enjoy the benefits. Which I think goes then into your second question about our goal at these conferences. It's multifold, right? Manyfold. One is, look, there's a lot of patients and there's a limited number of clinics, and we know that means that it's going to be just this steady cadence over time given the strong underlying demand. What we do at these conferences is continue to promote awareness of the drug for those who may have been not on therapies or remote to care and are starting to come back or are curious about being on a therapy.

Also continuing to let people understand the benefits we're seeing, that we're seeing benefits in patients who have classical PKU and non-BH4 mutations. We've had it in NPKUA. One of the prescribers told stories about severe patients with classical PKU having significant responses. That's really important for patients to hear that they can get an oral therapy that allows them to lower phenylalanine and liberalize diet.

It's also really important to continue to reinforce the data and the messages around AMPLIFY and patients who are on KUVAN, for example, or the brands that are generic, to hear that 100% of those patients in our data have a much better response to Sephience and are able to get even lower phenylalanine and liberalize their diet even more. I'd sum it up by saying we're early in launch. The response has been strong. The demand is really strong, but our teams still have work to do in continuing to reinforce the message, continuing to engage with patients, family members, caregivers, prescribers, letting them understand the benefits that they could enjoy with Sephience so we can continue to get those trying numbers up to 70%, 80%, or even higher.

Thanks, Matt.

Thank you. Our next question comes from Tazeen Ahmad with Bank of America. Your line is open.

Hi, good afternoon. Thanks for taking my questions. Matt, you've been really clear about defining how this launch is proceeding as very steady and consistent. You have in the past talked about roughly adding about 140 new scripts per month. Can you just talk about whether or not you expect that to continue to be the cadence for the rest of the year? If not, maybe just talk to us about anything that's changed. Then can you just give us a little bit more color about what you're seeing in discontinuation rates so far? Thanks.

Yeah, absolutely. Tazeen, I think we've moved now towards just really highlighting revenue in patients on drug, because at this stage in the launch that you're starting to hear the global contributions and prescriptions mean different things in different locations. I'll characterize things this way. I think we're continuing to see consistent demand. We believe in the potential for there to be steady growth, continued growth in the U.S. based on that demand, and continue to expect accelerated demand outside of the U.S. A lot of that is what underpinned our confidence in raising guidance to $850-$950, that we believe that we can continue to have steady growth in the U.S. and accelerating growth outside of the U.S. In terms of discontinuations, we continue to see very high compliance and very high adherence rates.

I think discontinuations now remain low at about 20%, which is really impressive at this point in the launch given the fact that a lot of the early patients who came on drug were those more severe patients. We also feel at this level that we're getting pretty close to steady state based on what we have seen from the clinical studies. Importantly, the renewal rates on prescriptions is super high. It's over 90%. Overall, all these metrics look really, really good and again, support our confidence not only in our ability to raise guidance for this year, but in long-term significant revenue potential for Sephience.

Thank you. Our next question comes from Joseph Han with Barclays. Your line is open.

Hey, it's Ellie from Barclays. Thanks for taking the question. You mentioned several early access programs ex-U.S. Just to clarify, are you recognizing revenues from these programs yet? I think you mentioned seeing accelerated demand in France, Italy, Spain, LATAM, and Middle East. Can you maybe give some color or characterize the number of patients on all of these early access programs and how that might compare to the 1,600 patients on commercial therapy globally? Lastly, I think you've mentioned being launched in about 30 countries by the end of this year. How should we think about which countries and when will contribute to revenues over the course of Q3 and Q4? Thanks.

Hi, Ellie. I'll give just some general comments, then I'll let Eric give a little bit more detail on early access. All those early access patients are contributing to revenue. What's important to note is that this whole approach we're taking in the global launch is really a well-thought-out plan. First, we had global commercial infrastructure in place, had already been commercializing in 50 countries. A lot of this was about understanding different markets, understanding sequencing of launch, understanding how we can maintain a rigid pricing corridor, which is more important now than ever. Also with early access programs, it allows us to get drug into patients in countries. It also tends to be a lot of those prescribers who are the leading KOLs in certain countries.

That's super important because this allows those physicians to have positive experiences with Sephience, and those are going to be the same physicians that will be called upon when HTAs are making assessments about access and pricing. They can go to these physicians who will have had firsthand positive experiences with the drug, which has obvious benefits in terms of access and reimbursement. I'll let Eric talk a little bit more about just overall number of countries and how we're thinking about sequence and launch and revenue contribution. Eric?

Yes, thanks, Ellie, for the question. As Matt said, the strategic plan was laid out many years ago actually because we are leveraging this infrastructure which had a portfolio of products for over 12 years. When we mapped out the sequence of this, we knew exactly that the U.S., Germany, and Japan would be commercial launches. We've also mapped out very carefully where early access programs would actually be implemented. We knew that there would be large addressable populations in Europe and the Middle East and Latin America. Places where we could get innovative pricing and reimbursement and maintain, if you will price for that innovation and maintain a narrow pricing corridor. We've actually implemented programs in France right now and key major markets.

France has already given us an HTA assessment, that's completed, they've approved our early access program, we've seen an accelerated demand rapidly in France. We've also seen accelerated demand both in Italy and Spain and a number of Southern European markets, as well as Central and Eastern European markets. We're just in that process of beginning and implementing those in Latin America and the Middle East, where they will be meaningful contributors. We've said that there's up to 30 markets that could potentially provide revenue. Keep in mind, as Matt said, over the last 10, 15, 12 years or so, we have actually been commercializing products in over 50 countries, we have extensive experience. We're going to bring Sephience to as many of these markets and as quickly as effectively as possible.

Great.

Thank you. Our next question comes from Eric Joseph with Citi. Your line is open.

Thanks for taking the questions, congrats on all the progress. Maybe just to pick up on the ex-U.S. outlook. Can you talk a little bit about of the 30 global markets that you're pursuing, which are likely to have their own HTA review processes versus referencing other geographies to arrive at a pricing decision, also what HTA review timelines might look like? If I could just squeeze in a pipeline question, I'd be curious to get a sense of timeline as it relates to the NLRP3 inhibitor program and what kind of profile might support later-stage development as those data read out. Thank you.

Hi, Eric. I'll take the second question first, make a comment on the first one, turn it over to Eric. We're excited about the NLRP3 program, as we've talked about. We've done a lot of work pre-clinically demonstrating that this molecule is highly differentiated in terms of potency. We've been able to benchmark it against others. It has specificity for the target, we talked a bit about how its chemical backbone is a bit different than others that have been in development that were, others had some potential toxicity concerns that we don't think will apply here. We've designed the phase I study to answer the typical phase I pharmacology, biodistribution, safety questions.

Also, we're including a cohort of patients with sort of metabolic syndrome phenotype and inflammatory biomarkers so that we can get early confidence that with the exposures that we're able to get, exposures we can get safely, the level of inhibition we're seeing is associated with favorable biomarker effects. We could have those data as early as the end of this year into early next year, and that would really put us in place then to move quickly into phase II. Again, we're super excited about this program. We've talked about focusing on rare pulmonary disorders as a first set of indications. That was based on the understood overlap between NLRP3 inflammasome and a number of pulmonary inflammation and fibrotic pathologies.

In the first question, let me just make a general comment that that number of 30 countries, we had said between 20 and 30, and that was just in 2026. I just want to make clear that we expect this to be, as the launch moves forward into 2027 and beyond, there's many more countries we seek to get to and target that 58,000 global adjustable market. Eric, do you want to talk a little bit about HTA processes?

Eric, thanks for the question again. HTA assessments are primarily in large Southern European markets. I'll just give you a little color for that. Those are the markets that are referenced pretty much around the world in international markets. For France, the HTA assessment is complete. We've completed that, and the early access program has been approved in Q2. As I mentioned, there's been a very accelerated demand by healthcare professionals for the early access program, and we're recognizing revenue there. The price is actually the German price. In terms of timing, pricing and reimbursement discussions are now ongoing, and we would expect that to conclude sometime next year in France. In Italy and Spain, again, key markets, HTA process is still ongoing, and that's going to be going on for probably into the third and fourth quarter.

We do have early access programs, again, being leveraged. Those are priced at the German price at this point in time. Then pricing and reimbursement discussions will be conducted with the authorities likely in the fourth quarter, and we're expecting that to conclude sometime in early 2027. As you already know, Germany, the HTA assessment was completed at the beginning of the year. Right now from a GKV discussion, this is still ongoing. Pricing and reimbursement should be finalized before the end of this year in Germany.

Excellent. Thanks for all the color.

Sure.

Thank you. Our next question comes from Ben Burnett with Wells Fargo. Your line is open.

Hey, thanks very much. I was wondering if you could maybe just talk to the revenue guidance. Great to see that increase. Just want to know what's considered in the increase. Is this mostly Sephience confidence, or is this from sort of broader confidence with other programs? And then just one clarification on the discontinuation rate. How was that defined?

Hi, Ben. On your first question on the revenue guidance, look, when we came into this year, we said we had a lot of unknowns that we were dealing with. We were still very early in the Sephience launch. We also, in terms of the Duchenne franchise, had significant headwinds with a significant number of generics now from Emflaza and headwinds in some of the larger countries where we get group purchase orders, as well as the fact that we're still selling product in Europe without a license. Clearly, the Duchenne franchise has had a bit more durability than expected, and the Sephience growth has been terrific.

As we went and looked at revising the guidance as we did after the first quarter and now again after the second quarter, it's based in large part on our confidence with Sephience and the ability for it to continue to grow in the way that we have seen it growing. Some of the widespread of the guidance range incorporates the fact that we could still see some contributions from the Duchenne franchise if Emflaza is able to withstand the continued generics, for example. A lot of it is our confidence in Sephience with some confidence that we may get still some more life out of the Duchenne franchise. In terms of the discontinuation numbers, we define that as going basically 60 days or two months without prescription renewal.

Great. Thank you.

Thank you. Our next question comes from Brian Cheng with JPMorgan. Your line is open.

Hey, guys. Congrats on the quarter. Maybe just first heading into the discussion with the agency on votoplam later this year, is the discussion going to enable you to talk about the ability to file for an accelerated approval based on the 24-month data? Is that one of the primary goals here? Secondly, we're seeing new patient add accelerated this specific quarter, and the revenue is not catching up as fast. I'm curious if you can help us, how do we best reconcile these two numbers? Thank you.

Yeah. Brian, in terms of votoplam, as we had said after we shared the data that our team and the Novartis team would discuss whether we would review those data with FDA. Clearly, the FDA's seeming agreement to accept a filing for the gene therapy on cUHDRS as an intermediate clinical endpoint was an important data point in our consideration of whether to talk to the FDA. I think the belief is that it's important to go and talk to them, talk to them about the data. Obviously, one of the important topics is going to be if there is a precedent for applications based on ICE in HD.

We believe our data compare quite favorably when you consider just the number of patients exposed, the dose-dependent effect seen in the Stage 2 patients, the fact that we have objective data of target engagement and mechanism of action with the dose-dependent durable lowering of blood huntingtin protein, as well as safety exposure in a large number of patients in a drug that's titratable, reversible, and we have a phase III study that's up and going, and enrollment's underway. We think all of those things allow for a really good discussion with FDA. Obviously, Novartis has made the comment that they're still operating under the assumption that phase III is the base case.

Importantly, that study has an interim analysis, but they have also commented, as we have, that we would look for any chance we have to accelerate access to a potential disease-modifying therapy, given the significant unmet need for Huntington's disease patients. In terms of patient adds, look, I think what we're seeing, again, is what we said is consistent demand and consistent adds in the U.S. and increasing contributions now globally. Obviously, patient numbers coming different. Patient numbers and revenue may be different in terms of that. Patient weights may be different. There's a lot of variables that actually go into the amount of reimbursement. Obviously, all patients don't enter in a quarter at one time. Some can come in a lot early, then some can come in a bit later. I think there's a lot of variables that go into it.

I think importantly to your point, we see consistent demand. We see growth in patient numbers that we saw in your early note is more than folks expected. We expect that to continue, and we expect the revenue also to continue to grow over time, as we've said, given the large number of patients and again, what we've consistently said is a significant $2 billion plus multibillion-dollar opportunity.

Thank you, Matt. Thank you.

Thank you. Our next question comes from Judah Frommer with MS. Your line is open.

Yeah. Hi, guys. Congrats on the quarter, and thanks for taking the questions. Are you able to add any guidance or detail on switching dynamics, patients that are switching from standard of care therapy to Sephience? Are there particular sales efforts that are generating success there? Is it word of mouth amongst patients? Anything anecdotal or tangible there would be helpful. Just on the peak sales opportunity for Sephience, any change in speed to peak as you're now through several quarters of the launch, or do you expect things to kind of be in line with your original expectations as of now? Thanks.

Thanks for the questions, Judah. Let me take the second one first, and then I'll ask Eric to comment a little bit on what we're seeing in the switching dynamics and some of the data that's driving that and some of the dynamics in those patients. Look, I think we've talked just generally about this being, call it, $2 billion plus, multi-billion dollar, not in terms of specific guidance, but just to help people understand what we believe is the magnitude of this opportunity. Recalling that when we started the launch, we were getting ready for the launch, a lot of people were benchmarking this to previous therapies. I think we are now at a full year run rate that exceeds what many people thought the initial opportunity was for this product.

We thought it's really important to really say that there's no benchmarking this in terms of previous PKU therapies, rather it should be benchmarked in terms of what a differentiated rare disease therapy with a population of 17,000 in the U.S. and 58,000 in markets where we could access patients and get reimbursed for drug could bring. I think as we get further into this year and into next year, we'll be in a better position to talk more about formal guidance. Again, we just have that number, and have stuck to that number now just to hold out the fact that, one, it's a much larger opportunity, I think, than many have initially imagined. Two, what we're seeing thus far in the launch does nothing but increase our confidence that this is the magnitude of this opportunity.

Eric, do you want to talk a little bit about the switching dynamics, some of the data, and what that's looking like?

Yeah, Judah, thanks for the question again. I think the first thing is that we said is we're really impressed after 12 months in the launch that we were able to see a lot of the dynamics of those patients who are actually failed or poorly controlled. We also saw that adults and naive have been coming in. What we thought may have been the case was that patients and physicians who are the highest unmet need would be the first ones treated. Now we have all centers of excellence who are prescribing, and we're also seeing now a significant movement to change what patients are seeing in terms of Phe reduction. I think we have a number of key programs that our sales teams, our medical teams are communicating about not just Phe reduction, but how lower Phe reduction is more important.

What we'll be showing at SSIEM will be some very important data that talks about normalization, patients at 120 micromoles per milliliter. When you think about normalization, that's incredibly important because we know patients who already respond to BH4 will have a much better response to Sephience and are likely to not only reach goal, but to reach normalization. That's going to be a very, very important part of our communication and messaging as we go forward. That's going to be supported by data as soon as next month at SSIEM. We have tailored programs from a medical perspective, and we're working with these centers. As we thought, these patients who were the most severe were the first ones to come on to therapy. Now we're seeing more and more benefits from patients who are switching, and that dynamic will continue over time.

Thanks.

Thank you. Our next question comes from Joseph Thome with TD Cowen. Your line is open.

Hi there. Good afternoon, thank you for taking my questions. Maybe the first one, I guess, in that upside scenario that the FDA is amenable to a filing for Huntington's, can you talk a little bit about where you are from a CMC perspective with votoplam and your readiness there? Then second, maybe on the DHODH inhibitor program. I know it's been a while, but you also had PTC299. Can you talk a little bit about the differences between that older agent and your next gen compound? Thank you.

Yeah, absolutely, Joe. On the HD, look, I think this is the benefits of, one, it's a small molecule, two, having a partner like Novartis who's well-equipped to move all of these things forward as quickly as needed. I think when we did the partnership back in 2024, then went through the official handover in early 2025, it's very clear that their teams are all over every aspect of getting things exactly in order for FDA approval. If we were given the opportunity based on the clinical data, I think we'd be very confident that that application could get there. Of course, obviously, the confirmatory study is already up and running. In terms of DHODH inhibitor, yeah, I think PTC299 was really a legacy product.

As one would expect from a when you go from Gen 1.0 to, I would say this is I guess technically 2.0, but it's more like a 3.0 or 4.0 in terms of how much more potent and specific it really is. I think we had a lot of conversations internally about bringing this molecule forward, when we saw how differentiated it is and understanding that there have been other DHODH inhibitors that have been approved, that have been viable commercial products, to be able to benchmark PTC844 to those, we showed those data at our Research Day as well as PTC299 and showed the superiority in terms of in vitro potency as well as specificity for the DHODH target tells us that we're now able to target a mechanism known to be important and do so in a very selective, specific and potent way.

We look forward to the phase IIa study. We're going to be doing that in a population of patients with significant inflammation with rheumatoid arthritis. That's not our intended indication, but rather what we want to do is take a population in whom we knew would have a biomarker profile of inflammation that would allow us to establish the relationship between DHO levels and effects on biomarkers of T-cell and B-cell immunity that can then help us inform where we would go from there in terms of specific target population.

Great. Thank you.

Thank you. Our next question comes from Faisal Khurshid with Jefferies. Your line is open.

Hey, guys. Thank you for taking the question. Just going to ask a couple of nitty-gritty commercial things, if you don't mind. Could you comment if there were any inventory effects for Sephience in the second quarter? Can you also comment on how we should be thinking about and modeling things like gross to net and net pricing and average patient weight? Have your assumptions there changed at all? Thank you.

Yeah. Thank you for the question. I would say, Faisal, we've had no inventory effects to think about. Things have been fairly constant in that regard. I would say as well, in terms of patient weight, patient age, gross to net, all those things have been consistent. We haven't seen any real changes there.

Thank you.

Thank you. Our next question comes from Brian Abrahams with RBC Capital Markets. Your line is open.

Hi, everyone. This is [Navannabi] for Brian. Thank you so much for taking our questions. Just one more on Sephience. How are you thinking about the split of revenues over the long term, especially just given that the ex-U.S. is progressing so well and you seem to be getting pretty good reimbursement and pricing there, and just given that there's a larger population outside the U.S. as well? I'm also wondering if you could talk about your updated thoughts on BD and if your appetite has changed there, if you're looking at any specific programs or therapeutic areas, and what the size of any potential deals that you might be able to do is.

Sure. First on the split, look, I think it may be a little early to give an exact breakout. I think we think that international can be a significant contributor here, but still the majority will likely always be driven by the U.S. I think there could be a significant contribution ex-U.S. when you start looking at that number of patients, and what we believe we're going to be able to achieve in terms of reimbursement. But it's a little early for us to give an exact breakdown there. I'd say, for example, what we're seeing thus far in Japan has been really impressive. There's maybe 1,000 or 1,100 patients there with PKU, but we're seeing a lot like the U.S. There's early demand. There's patients not on therapy who are coming back in and getting on therapy.

There's centers of excellence and, as Eric mentioned in the prepared comments, there we have a price on par with the U.S. Price is set for 10 years. It's very easy for patients to get on drugs. Again, there's a lot of these kinds of stories out there where we've seen the international markets be able to start to make an impact that we expect will continue to grow in the latter part of 2026 into 2027, and beyond. Pierre, do you want to talk a little bit about how we've been thinking about BD?

Yes, happy to. First of all, I will say we closed the quarter with very strong cash position of $2.2 billion. We worked really hard to get there. As we said, our team has demonstrated their ability to launch products globally. That's a key strength of ours. They have capacity. We're looking at BD in a number of ways. One, obviously, we're still laser-focused on Sephience. We don't want to distract the momentum at all. Are there ways to complement that very strong franchise for us? That's one bucket.

We're also looking at other areas in the rare disease space, late stage or commercial, again, to leverage that global infrastructure that we have. That's how we're thinking about it. Again, we want to make sure we are very disciplined in any potential transaction to make sure that we create value for shareholders. You mentioned size. Again, we are not going to do anything where we will lever up and use all our cash in one go. That's how we think about it.

Great. Thank you so much.

Thank you. Our next question comes from Luke Herrmann with Baird. Your line is open.

Hey, thanks for the question, team. Now that you're established in all the centers of excellence for Sephience, has there been any shift in the proportion of new starts stemming from sort of a proactive visit as compared to a more typical checkup schedule? Sorry if you've already covered this, but to the extent you're able to quantify how new starts tracked into July. Thanks.

Yep. Thanks for the questions, Luke. I would say that what we've been hearing from a lot of the KOLs is that most of the prescriptions are coming now as part of regular visits. Early on, we said the first couple of months of the launch, there were a lot of folks coming in, waiting lists, and a lot of attention in the first part. Most of the KOLs and prescribers have told us that somewhere late November or so, we saw a shift, and it's really as patients are coming in, they're looking to either start them on therapy, or switch them, for example. Now, that being said, we still note that one of the questions earlier asked about what the effects of us going to conferences and the work that our customer-facing teams do in the field and our patient support and patient engagement work does.

We know that the more messages, the more patients hear about this, there still is a lot of patient pull and market pull to get into clinics and get on the drug. In terms of starts into July, what we've said is that overall, we continue to see strong underlying demand. We expect there to be consistent growth in the U.S., accelerating growth outside of the U.S., and a lot of that is what underpinned or prompted our confidence and our ability to raise guidance to $8.50-$9.50.

Thank you. Our next question comes from Joe Schwartz with Leerink Partners. Your line is open.

Great. Thanks very much. I guess I have a question on Germany first. I think the pricing and reimbursement for Sephience was previously expected to be finalized this summer with other European negotiations advancing behind that. Why is it seeming to take longer? Are you getting the traction you expected? Will it hold up any of the discussions with other European countries in any way? Thanks.

Thanks, Joe. Eric, do you want to talk a little about the negotiations globally and particularly Germany?

Thanks, Joe, for the question. Keep in mind that we've launched in Germany, and it has been just barely on the 12-month cycle. We have a number of what we call mandatory negotiation sessions, and then there are informal ones with GKV. Clearly, those discussions have been productive. They've been cordial. We've been working on that. We've just now hit the summer months. Those discussions will continue throughout the summer. It's likely that our pricing and reimbursement will be finalized sometime in the third quarter, but it could go into the fourth quarter.

The list price right now that we have listed in the Lauer-Taxe is very similar to the U.S. price. It has not affected any of the other markets. In fact, Brazil, which CMED has referenced in terms of innovation status, the current Brazilian price is linked to the German price. Essentially, everything is going according to schedule, and we anticipate to have the final decisions sometime in the second half of this year.

Thank you.

Thank you. Our next question comes from Paul Choi with Goldman Sachs. Your line is open.

Hi. Congratulations on the progress, thanks for taking the questions. I have two on Huntington's. Matt, I was wondering if you'd maybe offer your preliminary thoughts on development of PTC303 as a monotherapy in Huntington's versus potential combination use with votoplam. Any early thoughts there would be great. My second one is, Roche recently discontinued its tominersen studies in Huntington's caveating for the usual cross-trial and cross-drug differences. Any thoughts there just on the implications, just given what was early and promising biomarker changes versus what looks like less success on clinical endpoints and just any thoughts on potential read-throughs there? Thank you very much.

Yeah, absolutely. First, look, we're super excited about PTC303. We talked about it at R&D Day, and I think, again, this shows PTC's ability to leverage splicing to bring forward potentially valuable and impactful therapies. PTC303 is one that can target several diseases characterized by somatic expansion. This is one that I think from conception to getting to a development candidate took our team probably a little less than three years, which is phenomenal. Really, I think is an example of how we're getting smarter and using the tools we have to facilitate and accelerate small molecule splicing development. As you pointed out, Paul, and we talked about on the call, HD is a disease of somatic expansion. Targeting MSH3 is probably now the hottest target in Huntington's disease drug development. We're very excited about votoplam. We think they could work together.

Also it could serve as a monotherapy, particularly in, for example, juvenile HD. Juvenile HD is a setting where there's a large number of triplet repeats, and it's characterized by rapid progression. What does that mean? There's rapid somatic expansion. You would think that something targeting somatic expansion, you could see a signal sooner and maybe louder in a short amount of time in, say, a juvenile HD population. We're very excited to be able to have this as a potential therapeutic option. We look forward to getting all of the IND-enabling studies done and getting this into the clinic as quickly as we can in 2027.

In terms of tominersen, I think it's been quite clear for a bit of time now, probably ever since the GENERATION HD1 data were presented, and probably even before that when some of the earlier stage data were presented, that a lot of the challenges with tominersen were not really a mandate or reflection of the potential of HTT lowering, but a lot of it was associated with the limitations of the ASO modality here. As was noted in earlier studies of tominersen, particularly when there was a 4-week dosing arm, it had to be discontinued because of the significant amount of inflammation created in the CSF by the ASO. In fact, in the doses used in GENERATION HD1 as well as GENERATION HD2, you still saw white blood cells and protein markers of immunoinflammatory response in the CSF of patients who received it. That's been noted.

That is something that has always been a concern. If you think about it, you're taking eight Huntington's disease patients, and a lot of those patients were later-stage patients. These are individuals who had brain inflammation and oxidative stress for decades, you are dropping an inflammatory stimulus into their CSF. What ends up happening is you can't actually, I think, readily or easily detect a favorable HTT lowering response because it's confounded by a significant inflammatory response in that population. Again, that's corroborated by the protein and white blood cells in the CSF as well as by some of the other issues with the CSF that were observed in that study. Of course, the association of certain points of NfL spikes following treatment.

All of that put together is really why I think a lot of people view the tominersen experience as really a reflection of that drug and not HTT lowering. We think that the Ariadne paradigm is probably a better way to think about votoplam, right? Oral small molecule splicing agent, gets full brain biodistribution, allow for titratability, allow to use the peripheral blood cells as a marker for target engagement and change of protein of interest, and then really allow you then to identify a therapeutic window so that you can deliver benefit along with safety. That's how we think about it.

Great. Thank you.

Thank you. I'm showing no further questions. I'd like to turn the call over to Dr. Matthew Klein for closing remarks.

Thank you again for joining the call this afternoon. We are incredibly excited about our performance so far in 2026. We look forward to continued outstanding performance, not only with Sephience but across the entire company. Thank you all again for joining the call.

Thank you for your participation. You may now disconnect. Everyone, enjoy the rest of your day.