Despite witnessing modest growth in demand over the past three months, Apellis Pharmaceuticals’ complement inhibitor for geographic atrophy (GA), Syfovre, may have hit a performance “nadir” in 2024’s third quarter, one group of analysts contends.
Over the latest earnings stretch, Syfovre generated $152 million in sales, down about 2% from the previous quarter when it brought home $154.6 million. The downturn came despite the ophthalmology drug seeing overall demand tick up 7%, with Apellis blaming the situation on a net selling price decline fueled by increased discounts.
While the third quarter was already shaping up to be a difficult one for Apellis, the company’s latest results are “even more challenging than expected,” Evercore ISI analysts Umer Raffat and Jonathan Miller wrote in a note to clients Tuesday.
Still, the fact that the third quarter “marks the likely nadir for Syfovre performance” should not signal that all hope is lost, with Raffat and Miller noting that Apellis management has remained confident in the face of competition from Astellas’ rival GA drug Izervay.
In particular, Apellis leadership has suggested they’re not seeing many switches to Izervay as efficacy messaging on Syfovre continues to gain traction, the Evercore team said.
"We believe that we are at a market share of 65%," Apellis' chief operating officer, Adam Townsend, said of Syfovre on an analyst call Tuesday.
In terms of new patient starts, Syfovre saw a slight decline at the start of the third quarter but rebounded to nearly 50% around the end of September, according to Townsend.
"The reason we believe is that this is an efficacy-driven market, and we have the strongest efficacy profile, and we're executing our plan to bring new prescribers and young prescribers into the market," he said.
On the topic of shifting prescriptions, "our data analysis suggests that switching does occur, but we actually think it doesn't happen that frequently," Townsend added.
While Syfovre’s revenue miss is no doubt disappointing, the drug remained the market leader in GA with more than 88,500 doses delivered to physicians in the third quarter, Apellis said in its release.
The company has also laid out objectives to help Syfovre maintain its competitive edge such as engaging with younger retina specialists, expanding relationships with general ophthalmologists and optometrists, generating new clinical data and real-world evidence, introducing a new injection needle to improve patient experience and further payer education.
For the remainder of the year, the company is predicting flat to modest sales growth for Syfovre.
Overall, Apellis reported total third-quarter revenues of $196.8 million, up 78% year over year. Beyond Syfovre, the company’s paroxysmal nocturnal hemoglobinuria drug Empaveli grew sales 0.4% quarter over quarter to $24.6 million.
The company delivered its results after last week reporting positive data on pegcetacoplan—which underpins both Syfovre and Empaveli—in the kidney diseases C3 glomerulopathy (C3G) and primary immune complex membranoproliferative glomerulonephritis.
The data came out shortly before Novartis unveiled results on its own C3G candidate Fabhalta, and, while cross-trial comparisons carry inherent flaws, the data so far seem to favor Apellis’ drug on certain kidney disease metrics.
To hear Evercore’s Raffat and Miller tell it, pegcetacoplan’s potential pivot into kidney indications is “underappreciated,” citing “very strong” doctor feedback around the med’s differentiated profile in C3G.