Rigel Pharmaceuticals, Inc. (NASDAQ:RIGL) Q3 2019 Earnings Conference Call - Final Transcript

Nov 05, 2019 • 04:30 pm ET

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Rigel Pharmaceuticals, Inc. (NASDAQ:RIGL) Q3 2019 Earnings Conference Call - Final Transcript

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Q & A
Operator
Operator

[Operator Instructions] Our first question comes from Chris Raymond with Piper Jaffray. please state your question.

Analyst
Chris Raymond

Hi, this is Ellie, wrestle on for Chris today. Thanks for taking the question. This is Ally Bratzel on for Chris today. So first I was just wondering if you could talk about any expected seasonality trends for TAVALISSE that we should be thinking about as we get into Q4 and the beginning of 2020. I know the sector can be impacted by seasonal tailwinds at the end of the year and headwinds at the beginning of the year. So any color on what to expect for TAVALISSE over the coming quarters and also any potential dynamics from fluctuations in distributor inventory will be helpful. And then could you also just give us some color on gross to net going forward. So I think you said it was around 18.5% this quarter which seemed in line with your expectations for this year but just going into next year I know you took a 10% price increase in July so how should we think about this maybe directionally going forward?

Executive
Raul R. Rodriguez

Sure. Thank you Ally. Appreciate that. Eldon and I and then Dean will answer your third question. There is seasonality in this business as you saw. Remember Q1 is typically a down quarter albeit there was some growth. We were delighted with that that we showed -- as insurance resets and Medicare donut hole issues play a role in that. Second quarter was excellent and that's a corollary to the first quarter strong second quarter. And you do see seasonality and we expect some seasonality. However as we said at our last -- on our investor call we ended Q3 in September with a strong -- in a strong way very good daily patient demand numbers. And we are seeing that continued into the first few weeks of this quarter. So we expect a good strong quarter as well this year. Eldon any other...?

Executive
Eldon C. Mayer

No I think you touch on all the points there. Second question was on inventory. I would just say that we would expect to see a mild increase in inventory that's consistent with the increasing demand as we have seen in the past. So that's all I would add to that. Dean would you want to comment on that GTN?

Executive
Dean Schorno

Yes. I think Eldon has the inventory right there. We would expect on inventory that as the distribution channels scales and really gets -- starts to mature then we could see a bit of fluctuation in those inventory levels. As it compares to the overall clinic and patient demand we think it will be a very small element of our total volume. With respect to the gross to net the 18.5% -- 18.5% 19% for the remainder of '18 is -- I'm sorry of '19 is what we expect. As we move into '20 the price increases really baked into that 18% 19% that we have seen in the back half of