Prepared remarks
Hello, and welcome to Nuvation Bio's Second Quarter 2026 Financial Results and Business Update Call. Today's call is being recorded, and a replay will be available on the company's website. The operator provided instructions. Now I'd like to turn the call over to J R DeVita, Vice President of Corporate Development and Investor Relations at Nuvation Bio. Please go ahead.
Thank you, and good morning, everyone. Earlier today, we issued a press release summarizing our financial results for the quarter ending June 30, 2026, and provided a business update. The press release is available on the Investors section of our website at nuvationbio.com. Today's call includes forward-looking statements, including statements about the therapeutic and commercial potential of IBTROZI and safusidenib, our development plans for safusidenib and our drug-drug conjugate platform, along with our plans for future updates from these programs, the components of our anticipated product revenue, expected milestone payments and our cash runway. Because such statements deal with future events and are subject to many risks and uncertainties, actual results may differ materially from those in the forward-looking statements. For a full discussion of these risks and uncertainties, please review our quarterly report on Form 10-Q, which we filed with the U.S. Securities and Exchange Commission today. Joining me on today's call are our Founder, President and Chief Executive Officer, Dr. David Hung; our Chief Commercial Officer, Colleen Sjogren; and our Chief Financial Officer, Philippe Sauvage. Now I'll turn the call over to Dr. David Hung. David, please go ahead.
Thanks, J R. Good morning, everyone, and thank you all for joining us. I'm excited to discuss the continued progress we made across our business in the second quarter. IBTROZI delivered another strong quarter with net revenue growing 25% to $23.2 million, in line with the median estimate from our 10 covering analysts. Approximately 160 new patients started treatment with IBTROZI in the quarter, but importantly, about 85% of these starts were in the first-line setting, our highest percentage since launch only 12 months ago. While we believe that revenue is the metric that best reflects the health and trajectory of the business, we felt it was helpful to again provide new patient starts this quarter to give more color on positively shifting launch dynamics. I'd also like to provide you with three specific points of context to further frame our view of the launch today. First, we are executing on our commercial plan well, and we are now the ROS1 TKI market leader in both first-line and overall new patient starts. Second, we are expanding the ROS1 market beyond how it has been viewed historically with the majority of IBTROZI's growth coming from the first-line setting. And third, the promise of IBTROZI's clinical differentiation is being realized in the real world. Now I'll spend some time walking through these points in more detail. We are very encouraged that the number of first-line patients starting IBTROZI continues to robustly grow. In fact, we saw growth in first-line new patient starts of approximately 30% from the prior quarter. The remainder of our new patient starts were within the TKI pretreated population, which we believe is lower than previous quarters because we've now treated so many of these more advanced patients in the 12 months since our FDA approval. We expect the first-line patients to become the main driver of long-term growth due to the much longer duration of treatment in the first-line setting, and we see this dynamic happening in real time. As Colleen will discuss, we are thrilled that IBTROZI is now the #1 choice for newly diagnosed advanced or metastatic ROS1-positive lung cancer patients. The profile of IBTROZI is exceptional. In TKI-naive patients in TRUST-I, IBTROZI demonstrated an objective response rate, or ORR, of 90% and both a median duration of response, or DOR, and median progression-free survival, or PFS, of 50 months — a response and durability profile that, to our knowledge, has not been shown by any approved therapies in any solid tumor oncology indication. When a drug combines this level of efficacy and durability with a generally favorable tolerability profile, there is a potential for patients to remain on treatment for years. As more patients start and stay on IBTROZI, the prevalent patient pool grows, while the population is simultaneously expanded by new incidence patients per year. As the dynamic shifts to more patients staying on drug longer rather than patients coming off of drug more rapidly, we believe IBTROZI's launch begins to look more and more like a chronic disease drug launch than a typical cancer drug launch. Short durations of response are common for many oncology agents measured in months rather than years. This short duration of response does not generally allow these agents to appreciably grow the number of patients treated year-over-year. Celgene's blockbuster Revlimid with a nearly three-year DOR in multiple myeloma is an example of an oncology agent that was able to grow its treated population year-over-year due to its durability. The clinical data set our expectations high, and we are pleased that commercially, we are meeting them. Adverse event-driven discontinuations remain low, while discontinuations that we do observe continue to be concentrated in later-line patients with greater disease burden and exposure to multiple prior therapies. The increasing proportion of first-line patients gives us significant confidence in the long-term trajectory of IBTROZI. Feedback from both our field organization and leading thoracic oncologists has remained positive and highly consistent. At the American Society of Clinical Oncology Annual Meeting, reception from the medical community exceeded our expectations. There is genuine conviction in IBTROZI's clinical profile, recognition of the impact we are having on patients and a growing appreciation that the durability data we are generating puts IBTROZI in a category of its own in ROS1. Many oncologists drew a parallel between IBTROZI's more-than-four-year DOR and lorlatinib's recent and impressive long-term CROWN data and how it has changed the treatment paradigm in ALK-positive lung cancer. We believe the growing maturity of the IBTROZI data is having a similar effect on physician prescribing decisions in ROS1-positive disease. Also at ASCO, we presented new patient-reported outcomes from the TRUST-II study that further characterized what patients experience while receiving IBTROZI. At the first assessment, 88% of patients reported improved or stable global health and quality of life scores. Importantly, cognitive function improved or remained stable over the course of treatment. It is notable that IBTROZI is the only brain-penetrant ROS1 TKI today that carries no warning for CNS adverse reactions, a direct result of the outstanding clinical safety data set. This stands in contrast to the three other brain-penetrant ROS1 TKIs on the market, including last month's newly approved ROS1 TKI, where CNS warnings are part of all of their labels. CNS adverse events, which may include cognitive impairment, directly affect how people living with the disease think, communicate and function in their daily lives. And for someone who would hope to be on therapy for years, that is not a small thing. The commercial trends, physician feedback, quality of life findings and longer-term efficacy data taken together continue to reinforce our belief that IBTROZI is becoming the standard of care in advanced ROS1-positive lung cancer. Turning to safusidenib. We are equally excited about the progress we are making toward developing a comprehensive treatment option across the broad spectrum of IDH1-mutant glioma. We recently announced updated long-term results from the Phase II J201 study in 27 patients with chemotherapy- and radiotherapy-naive Grade 2 IDH1-mutant glioma. With a median follow-up of 39 months, the centrally assessed ORR increased to 52% from 44% at 28 months of median follow-up. Median PFS had not yet been reached and the 36-month PFS rate was 79%. Responses in the study have continued to deepen and no new safety signals were observed with additional follow-up. While we realize the limitations of cross-trial comparisons due to differences in study designs, patient populations, endpoints and sample size, we believe these results can be viewed favorably against the latest update from the INDIGO study of vorasidenib, in which with median follow-up of 42 months, the ORR was 21% and the PFS rate at 36 months was 52%. These updated data continue to reinforce safusidenib's differentiated profile and compelled us to expand our clinical development plan. As we have previously discussed, we think about the IDH1-mutant glioma market in four broad segments: Group A, high-grade high-risk disease; Group B, high-grade low-risk disease; Group C, low-grade high-risk disease; and Group D, low-grade low-risk disease. Our existing Phase III SIGMA study evaluates safusidenib in Groups A and C as maintenance therapy for patients with high-risk IDH1-mutant astrocytoma following standard of care. A separate exploratory cohort is evaluating safusidenib in Group B, enrolling patients with Grade 3 oligodendroglioma following surgery and before chemotherapy and radiation. Together, those portions of the program address three of the four segments of the glioma opportunity. We recently announced two additional studies that extend the program into the remaining Group D, the low-grade low-risk disease segment, which will also present an important new treatment sequencing opportunity. The first new Group D study, G307, is a randomized Phase III trial that will evaluate safusidenib in 140 patients with newly diagnosed Grade 2 IDH1-mutant glioma who have not yet received chemotherapy or radiation. The study will be conducted outside the United States in regions where vorasidenib is not yet approved or accessible and its primary endpoint will be PFS. This study also gives us a direct opportunity to evaluate safusidenib in the low-grade, low-risk setting where vorasidenib is FDA approved. And upon completion and assuming the study is successful, we plan to engage with FDA to discuss the potential for an NDA submission on the basis of these results. The second new Group D study, G209, is a Phase II trial that will enroll up to 40 patients in the United States with Grade 2 or Grade 3 IDH1-mutant glioma whose disease has progressed following treatment with vorasidenib, but are not in need of immediate treatment with chemotherapy or radiation. The primary endpoint is ORR, and this study will also likely capture patients from Group C and B, given the broad population being treated commercially with vorasidenib. This is an increasingly relevant real-world treatment setting. As more patients receive vorasidenib, physicians and patients will need an effective option when the disease eventually progresses, particularly one that may allow patients to further delay chemotherapy and radiation, which can present significant long-term side effects for these younger patients in the prime of their lives. We believe demonstrating activity following vorasidenib could further strengthen safusidenib's potential across the low-grade glioma market and provide these patients with a critical option. While our two Phase III studies, SIGMA and G307, have PFS as their primary endpoint with data expected in 2029, we now also have two exploratory studies which use ORR as the primary endpoint: the Grade 3 oligodendroglioma cohort and the G209 study post-vorasidenib. In these studies, we are now also evaluating tumor growth rate, or TGR, as a potentially even earlier signal of efficacy. In our safusidenib data, we've observed favorable TGR changes prior to formal RANO responses in all responders. While TGR is not yet a validated regulatory endpoint, it may be an earlier surrogate marker with the potential to identify those patients who are likely to go on to achieve measurable response or clinical benefit. We look forward to generating data that we may be able to share externally. Taken together, SIGMA and the Grade 3 oligodendroglioma exploratory cohort, G307 and G209 allow us to efficiently evaluate safusidenib across all grades and risk groups within the IDH1-mutant glioma landscape in both before and after treatment with vorasidenib. That is what we mean when we say we're pursuing the full glioma opportunity. We also remain on track to provide an update on our drug-drug conjugate, or DDC, platform by the end of the year. That update will include additional detail on our clinical development plan. Finally, in June, we completed an opportunistic, approximately five-times oversubscribed convertible debt financing, which provided both an attractive opportunity to retire higher cost debt and add further strategic flexibility, including for business development. Philippe will discuss the transaction in greater detail. With that, I'll turn the call over to Colleen.
Thank you, David, and hello, everyone. Four quarters in, and our commercial team continues to raise the bar. Our cumulative new patient starts have significantly outpaced prior ROS1 launches, and we continue to pull ahead of both repotrectinib and entrectinib combined. That is a direct reflection of physician confidence in IBTROZI's clinical profile and the relentless focus of our commercial organization. What I want to highlight today, though, is that the growth we are seeing this quarter goes beyond the numbers. It is the composition of that growth and what it signals about the long-term opportunity that makes me most optimistic about where we are headed. IBTROZI is now the most prescribed ROS1 TKI across all lines of therapy in 2026 based on IQVIA claims data from January to May. Importantly, data show doctors are now choosing IBTROZI for new patients over 50% of the time in the first-line setting. This reflects the medical community's growing confidence in IBTROZI and conviction that its clinical profile, specifically long-term durability and manageable safety, makes it the right choice in the first-line TKI-naive setting. That conviction is translating into something more meaningful than just market share, namely market sequencing. The treating community has increasingly designated IBTROZI as the standard of care in the first-line setting with other currently approved therapies viewed as options that follow IBTROZI in the treatment paradigm. And we expect that trend will only continue to build. We believe that IBTROZI's profile in the TKI-naive setting is unmatched: a confirmed 90% overall response rate and a median duration of response of 50 months. Equally important is IBTROZI's differentiated safety profile compared to other CNS-penetrant ROS1 inhibitors, both in adverse events as well as warnings and precautions. As previously mentioned, IBTROZI is today the only brain-penetrant ROS1 TKI to not have CNS warnings and precautions in its label. Durability over time, combined with tolerability, is what defines the value of a therapy in oncology, and that is where IBTROZI's data stands out. For a physician making a first-line treatment decision for a newly diagnosed patient, that distinction is not a footnote; it is a defining factor. What makes this even more meaningful is the directional shift we are seeing within our own new patient starts, which totaled approximately 160 for the quarter. Importantly, approximately 85% of these 160 new patient starts were from the first-line setting compared with approximately 30% first-line use in patients starting IBTROZI at launch less than a year ago. In practical terms, the center of gravity of our business is moving toward patients who are beginning their ROS1 journey for the first time. And our first-line new patient starts are at their highest point ever, growing approximately 30% over the prior quarter. Our patient starts in the later-line setting are slowing due to IBTROZI's successful capture over the past year of many of the TKI pretreated patients who on earlier generation ROS1 TKIs had either progressed or failed for tolerability. For first-line patients, starting on IBTROZI means the potential for four-plus years of durable response. That is the long-term value of this clinical profile fully realized, and it is where our commercial team has been deliberately and systematically driving prescriber behavior since day one. As David mentioned, net revenue grew 25% quarter-over-quarter, and that growth is not concentrated in any one provider segment. It is happening across every practice setting. This reflects the medical community's deep belief in IBTROZI's clinical profile, our ability to remove barriers in treatment decisions, favorable market access positioning and our commitment to getting patients on therapy quickly. Integrated delivery networks, or IDNs, large integrated health systems that span hospitals, outpatient clinics and physician practices, have become a meaningful and accelerating contributor to demand. Community demand has notably grown since launch and academic accounts continue to demonstrate strong and expanding adoption of IBTROZI, contributing to 50% of our business. When growth is broad-based across academic, community and IDN settings simultaneously, it reflects institutional confidence in IBTROZI's profile, and that is exactly what we are seeing. One of the most encouraging trends this quarter is that the ROS1 lung cancer market itself is growing. And I want to put that in context for a moment. ROS1 inhibitors have been available for nearly a decade, and we came to market as the fourth option in this class. Based on IQVIA claims, the number of patients receiving any ROS1 TKI in the first-line setting grew almost 20% from our launch through May 2026 compared to the same period a year earlier. In other words, more newly diagnosed ROS1-positive patients are being treated with a TKI today than ever before. While this growth is encouraging, on top of that expanded pool of patients receiving a ROS1 TKI, there are still substantial numbers of ROS1-positive patients receiving chemotherapy and/or immunotherapy in the first-line setting, even though this regimen is no longer recommended by NCCN guidelines. We would expect these patients receiving IO and/or chemo to over time be treated with IBTROZI. Changing this entrenched market behavior takes time, but the trend is moving in the right direction, and we believe IBTROZI is a meaningful driver of this initial shift. That said, we continue to execute focused initiatives to disrupt the habitual tendency towards chemotherapy and IO in the community setting and ensure that every ROS1-positive patient and their physician have the information they need to make a treatment decision that is consistent with current treatment guidelines. We strongly believe every patient with a ROS1 fusion deserves the opportunity to benefit from the prolonged durability and high response rate IBTROZI has demonstrated in the first-line setting. And partnering with the community to make that happen remains one of our most important priorities. Ultimately, everything we do comes back to patients living with and impacted by this disease. When I think about what potentially four-plus years of response actually means for somebody who has just been told they have ROS1-positive lung cancer, that is what motivates us the most here at Team Nuvation. Our purpose is reflected in every metric we track. This quarter demonstrates continued execution from a team that understands how to win in targeted oncology: first-line market share leadership in new patient starts, demand growing across every setting and a real-world tolerability profile and duration of use that mirrors our clinical data. The foundation we are building cohort by cohort, physician by physician, is what we believe will drive the long-term revenue opportunity David described earlier. Now I'd like to turn it over to Philippe.
Thanks, Colleen, and good morning, everyone. For detailed second quarter 2026 financial results, please refer to our earnings press release, which is available on our website. I will highlight a few key points from the quarter. In the second quarter, we generated $31.7 million in total revenue, which was greater than the median estimate of our 10 covering analysts. This included $23.2 million in IBTROZI net U.S. product revenue, which, as David mentioned, was in line with the median estimate of our 10 covering analysts, and $8.5 million in collaboration and license revenue. For the first six months of 2026, total revenue was $114.9 million, including $41.7 million in IBTROZI net U.S. product revenue. As David and Colleen mentioned, our IBTROZI net revenue grew 25% from the first quarter. This was mainly driven by both growth in first-line new patient starts and an increasing percentage of first-line patients making up our active patients on therapy. We believe these trends will support the long-term potential of IBTROZI because we expect these patients will stay on therapy for years. From the outset, we understood that the pretreated ROS1 population represented a finite opportunity and that later-line patient accrual will naturally diminish over time as we successfully shifted our focus towards the first-line setting. It has happened a bit faster than we expected, which is a testament to the impressive pace of our launch and our successful capture of the TKI pretreated population. Our access strategy continues to be effective with broad coverage to label across Commercial, Medicare and Medicaid plans. Gross-to-net deductions were stable at around 30% in the second quarter. We expect this to continue to remain generally stable as our payer mix and contracting mature. The remainder of our revenue was generated through collaboration and license agreements. We continue to receive royalty revenue from Innovent Biologics in China and Nippon Kayaku in Japan, and we remain eligible to receive approximately $30 million from Eisai upon the potential approval of IBTROZI in Europe next year. We continue to invest in the business and our programs, resulting in total operating expenses of $73.3 million for the quarter. R&D expenses were $30.7 million for the quarter and $65.7 million for the first six months of 2026, primarily reflecting investment in the TRUST and safusidenib clinical development programs, including SIGMA and preparation for the two newly announced studies. SG&A expenses were $42.6 million for the quarter and $80.9 million for the first six months of 2026, primarily driven by support for the commercialization of IBTROZI. We do not expect changes to our general spending patterns for the remainder of the year. Turning to the balance sheet. We had cash, cash equivalents and marketable securities of $661 million as of June 30. As David mentioned, we recently completed an offering of 0.75% convertible senior notes due 2032, which resulted in total proceeds of approximately $279.1 million, net of fees and related reimbursements. Our cash balance at quarter end includes $242.6 million of these net proceeds as $36.5 million was secured from exercise of the overallotment option, which occurred after quarter close. We were thrilled that the transaction was approximately five-times oversubscribed, and we upsized the original offering amount. This deal was entirely opportunistic as we believed we had sufficient capital to reach profitability prior to the offering. As we approached the June 30 deadline under our term loan agreement with Sagard, we had the option to draw an additional $50 million at a minimum interest rate of 10%. We determined that it made more financial sense to access the convertible market at a 0.75% coupon, elect not to draw the additional $50 million and pay the approximately $58.7 million for the voluntary prepayment of the $50 million already outstanding under the term loan, along with accrued and unpaid interest, fees, costs and expenses. As a result, the transaction materially lowers our cash interest expense, and we expect to pay less interest under the new notes than we would have paid even without drawing the extra $50 million under the Sagard facility. We still retain the synthetic royalty interest financing we closed with Sagard last year. Of course, we are sensitive to the implied dilution for our shareholders, which is why we also entered into capped call transactions designed to reduce potential dilution upon conversion of the notes. The capped call has an initial cap price of $10.458 per share, representing an 80% premium to the closing share price at the time of the offering. After paying the cost associated with the capped call, repaying the term loan and covering transaction expenses, the remaining proceeds further strengthen our balance sheet and provide additional flexibility for general corporate purposes. This transaction does not change our approach to business development. We will remain disciplined and we will pursue only opportunities that we believe can generate compelling returns and meaningfully increase long-term shareholder value. The additional capital simply gives us greater flexibility and the ability to be more competitive if and when we identify the right opportunity. Overall, our capital position enables us to support the continued growth of IBTROZI, execute the expanded global development plan for safusidenib, advance our DDC platform and evaluate additional strategic opportunities from a position of strength. Based on our current operating plan and revenue trajectory, we continue to believe we have sufficient capital to reach profitability and fund the anticipated launch of safusidenib. I'll now turn it back to David for closing remarks.
Thanks, Philippe. This quarter reinforces what we are building at Nuvation Bio. We believe we have the commercial program with the potential to turn advanced ROS1-positive lung cancer into a disease that patients can live with for years, a second program positioned to address the broad spectrum of IDH1-mutant glioma and the financial strength to advance both opportunities with urgency and discipline. We also continue to work toward enhancing our pipeline further with our DDC platform. I'm proud of the progress our team continues to make and grateful to our employees, investigators, partners and shareholders and the patients and families who place their trust in us. I'll now ask the operator to open the line for questions.
Questions and answers
The operator provided instructions. Your first question comes from the line of Farzin Haque with Jefferies.
Congrats on the progress. Maybe related to IBTROZI, what is your read on GSK's Jideytro pricing at roughly 8% higher than IBTROZI? They also have CNS adverse events and pancreatic toxicity on the label. That was a bit surprising to us. But the label does not explicitly say that they excluded concomitant driver mutations. So to what extent do these label differences influence your commercial message?
So I'll let Philippe answer the question on pricing, but I'll get to the other one. If we look at the label that we saw with zidesamtinib, I think probably the biggest surprise to us was the CNS warnings and precautions. Zidesamtinib since its inception has always been touted as a CNS-sparing TKI for ROS1, and I think we were surprised to see that if you look at the label, a 25% incidence of CNS adverse reactions that include dizziness and ataxia, cognitive impairment, psychiatric disorders and seizure. These are things that I don't think we expected. We had not seen that previously. And as I said in my prepared remarks, that now places zidesamtinib in the same bucket as repotrectinib and entrectinib as the brain-penetrant ROS1 TKIs that all have CNS warnings and precautions, and that makes entrectinib the only ROS1 TKI without CNS warnings and precautions. The other thing that we were a bit surprised by, if you look at the other adverse events like a 38% rate of edema, 25% rate of peripheral neuropathy, 22% amylase and 25% lipase elevations, which are indicative of pancreatic toxicity, and a 15% rate of shortness of breath. Not only were we surprised by the magnitude of these findings, but that's after only a very short follow-up period. We're talking about a follow-up period that's about one quarter of what we had with IBTROZI. We know that adverse events are often positively correlated with length of follow-up. So when we look at all these numbers with one quarter of our follow-up period, we would expect that when the follow-up reaches the length of IBTROZI's follow-up, these adverse events could increase. So I think we were surprised by that. We don't see anything in the label that we find a threat to IBTROZI. If we just look at the efficacy numbers, with the caveat of cross-trial comparisons of course, in the second-line setting, the ORR for zidesamtinib was 49%. In our pooled JCL data, it was 56% and, importantly, if you look at the intracranial response rate — this is the main way that these patients progress and that's what limits their survival more than anything — zidesamtinib's intracranial ORR was 48% and ours was 66%. So we just don't see anything in the efficacy side or the safety side that we feel is a threat, and we will maintain — we believe that we are the best-in-class ROS1. I think that our adoption is consistent with that. We've seen broad enthusiasm for IBTROZI across all segments. As you know, when we started our launch, 75% of our customers were academic, 25% community. Now it's 50-50. So when we have broad support across really all segments, I think that really speaks to our label. We just don't see anyone on the horizon that we think is going to be a threat to our label and our profile. Philippe, I'll let you answer the pricing question.
Yes, just like you, my reaction was that this appears to be a pricing strategy for a later-line drug, which makes sense considering they obtained a later-line approval. We made at the time of our launch a very different strategy of being slightly lower than repotrectinib because we really wanted to have broad access for a line-agnostic therapy. Clearly, GSK went in a different direction with a higher price, which is more aligned with a later-line drug strategy. I don't have more insight than that, but that was my first impression.
And the other thing, Farzin, which I didn't — I was talking about second-line characteristics. Our first-line data, we don't even know what zidesamtinib's first-line data are because we have a 90% response rate and a 50-month median duration of response in first-line. There hasn't been any drug ever in oncology that has matched that. So we think the chance of that being matched or better by another drug is probably pretty remote. So we just don't — and no matter how you look at it, if their follow-up in the second line is a quarter of ours, you can imagine that the amount of time they are behind us in the first line is even greater, years behind where we are. So we don't see competition in the second-line setting. We know that their priority approval was for the third-line setting. We think these patients need a third-line drug; we'd be delighted to see another option for those patients. But in the second-line setting, we still believe that our safety and tolerability as well as efficacy are superior. And we do think in the first-line setting, there's nothing to even begin to compare with our data because there is not. So we feel very confident now — the last card is on the table — I think we feel very confident of our position in ROS1.
Your next question comes from the line of Gregory Renza with Truist Securities.
Congrats on the quarter and progress. David, maybe just to follow up on the GSK approval and launch. You talked about some of the surprises and the positioning with IBTROZI now against the latest entrant. I'm curious with respect to the early approval earlier than the anticipated PDUFA, how has that informed and maybe altered the tactical plan with Colleen and the team, given it has come to market sooner than expected? And then secondly, looking longer term and as you contextualize this market and the longer-term patient stacking opportunity, how has the one year under our belt really helped to alter or provide some headwinds or tailwinds to some of the patient stacking theoretical data that you've provided to us about the multiyear stacking opportunity for IBTROZI?
Thank you. Let me start, and then I'll turn it to Colleen. With regard to an earlier approval than the September 18 PDUFA date, I don't think that has any significance for us at all. In fact, frankly, for us, it's always been a little bit of a mystery what we were competing against, and it was actually helpful for us to see the label early. As I said, that surprised us. We did not expect to see a tolerability profile as challenging as we did see in their label. So for us to know that sooner was actually helpful to us. It didn't change at all our tactical strategy on commercial. I'll let Colleen address that. But the most important thing on this call is that we've said all along from day one, even though the prevalence pool of pretreated patients is larger than the incidence pool, when we started a year ago, there were somewhere between 1,000 and 1,500 prevalence patients. We've now marched through most of those patients, which is why we've actually depleted that pool. If you look at new patient starts diminishing somewhat, it's because we actually went through that pool a lot faster than we ever thought we would, which is a testament to the strong profile, safety and efficacy of IBTROZI. But we've always said that this is a first-line market. The fact that we are now 85% first-line patients is something we're pretty pleased about. I said on the last quarter call that this was going to be a biphasic new patient starts number: you start with a pool, you treat through it, that number diminishes and then you grow the market. Colleen already said we've already grown the market 20% in the total ROS1 TKI number since our launch, and we would expect a number of drivers to continue to grow that. Number one, when good drugs are available, markets grow. Number two, testing is going to increase — that's a general trend across the industry. Number three, even if you have a positive test, IO chemo is still being used a lot more than it should be; physician behavior change takes time. And the NCCN guidelines that contraindicate IO only came out on January 7 of last year, about one and a half years ago. So that change is ongoing. We also expect a shift from DNA to RNA testing that we hope will increase the number of diagnoses because RNA is generally more sensitive for ROS1 fusion detection, perhaps by roughly 30%. Colleen, I'll turn it back to you.
Greg, you asked one of the most important questions in the launch right now about this first-line shift and revenue stacking. When we look at earlier-line patients, they respond at higher rates, they tolerate our therapy better, and they're staying on treatment significantly longer. For IBTROZI specifically, demonstrating a median duration of response of 50 months in the TKI-naive patients versus shorter durations in later-line patients where disease progression and prior therapies are the primary drivers of discontinuation — when we look at each successive cohort of first-line patients beginning therapy and remaining on therapy, that's what creates this compounding base of active patients. That's what's building our revenue over time. So when we look at the 25% sequential growth in revenue this quarter, while managing the natural transition away from later-line patients, that's early evidence of the dynamic beginning to play out. We are starting to build a chronic disease model and the shift in patient mix is really the foundation of that.
And Greg, maybe to add one thing to Colleen's point and your question about the timing of launch: what is really important to note is that our late-line patient pool has already been depleted from our perspective. All those patients have had an opportunity to use IBTROZI prior to the launch of zidesamtinib, which is again a testament to the speed and the impact of Colleen's team to really make sure all those patients could benefit from IBTROZI. As of now, when you look ahead, as we've always said, this is a first-line story. And really, just to remind you again, IBTROZI doesn't have a first-line indication now, so all these later-line patients have already, from our perspective, had an opportunity to use IBTROZI prior to zidesamtinib's launch, which I think is really important for us.
Your next question comes from the line of Mayank Mamtani with B. Riley Securities.
Congrats on a strong quarter. Regarding the roughly 750 newly diagnosed front-line patients, there's still a lot of capture rate you can grow here. Any testing initiatives you're involved with directly and how can we see this penetration move up? I know you talked about IO plus chemo trends, but just the underlying testing, how that can grow? I have a follow-up on the SIGMA program as well.
Mayank, let me start, and I'll turn to Colleen. When we started our launch, we noted that in the academic setting testing rates are nearly 100%, and they are. In community centers, testing rates vary; some are in the 80% plus range, but others can be 50% or lower. We've met with many larger community oncology aggregators who have lower testing rates and embarked on projects to show them their testing rates. Interestingly, many were surprised at their own testing rates; they thought they were higher. By raising that awareness, we were able in several centers to more than double their testing rate so far. We're continuing to do that. We're also pointing out to these centers that some have much higher IO chemo use than they expect; when we look at their electronic medical records, IO chemo use is often higher than management assumes. Pointing this out has helped shift behavior. Colleen?
Mayank, thank you — that's an insightful question. This is a real dynamic across targeted therapies in lung cancer and we're addressing it directly. Despite NCCN and ASCO guidelines recommending against chemo with or without IO and recommending targeted therapies such as IBTROZI for ROS1-positive patients, habitual prescribing patterns in the community persist. We have several targeted initiatives to disrupt this cycle, including direct partnerships with community practices, patient identification programs and tools that make it easier for physicians to identify and flag these mutations and ensure the mutational status is flagged before defaulting to a first-line treatment decision. We are also advocating for RNA-based testing, which has been shown in publications to improve detection rates by upwards of 30% for ROS1 fusion. We're addressing this head on and believe we are making good progress.
Mayank, one more thing Colleen alluded to: these testing and treatment behavior challenges go beyond ROS1. You saw a big push at ASCO from peers in ALK and other targeted spaces. It's a broader industry effort to make sure testing and identification happen consistently for patients.
Let me make one other point. Good drugs grow markets. If you look at IO chemo PFS for these patients, it's about a year or less. Early ROS1 TKIs like entrectinib had PFS around 16 months, which wasn't massively different than IO chemo, so the argument for switching wasn't as strong then. Repotrectinib with a roughly 34- to 36-month PFS significantly changed the bar and drove NCCN changes. Now with IBTROZI's data of 50-month DOR, it's virtually impossible to make the clinical argument for IO chemo first. We're talking about years of potential benefit, which increases the necessity for testing. We're already seeing that change.
Just quickly on the G209 study in glioma: there's a lot of investor interest. For the post-vorasidenib cohort you've added, what's your expectation on the data there itself and how big a population exposure would you need where engaging with regulators would make sense?
If you look at Servier's statements last quarter about how many patients were on vorasidenib, they said over 5,500 patients were on vorasidenib, and that number is likely higher now. In INDIGO, about 23% of those patients progressed at one year. Since vorasidenib has now been out for over one and a half years, we would expect roughly a quarter of those patients to be failing or have failed. That suggests potentially over 1,250 patients who have failed or are failing vorasidenib, which speaks to both the unmet need and the feasibility of enrolling the study. We've noted precedents where approvals were obtained on single-arm studies; for example, Chimerix got approved with a 22% response rate in 50 patients. Ojemda did it in 77 patients. So we think something between 50 and 80 patients could be sufficient to show a response signal that would allow us to engage regulators. We also are evaluating tumor growth rate as an early signal; in our safusidenib data we observed favorable TGR changes prior to formal RANO responses in all responders. TGR may be an earlier surrogate marker to identify patients likely to achieve measurable response and clinical benefit. We think this could help provide an earlier readout and would be a topic for discussion with FDA.
Your next question comes from the line of Michael Yee with UBS.
This is Matt on for Mike. Congrats on a nice quarter. One more on the IDH1 program: what gives you confidence that the FDA would be amenable to filing in low-grade using the out-of-U.S. data? Do you think you will need to supplement with some U.S. data? How do you think that will play out in that low-grade setting around the placebo-controlled study?
The most compelling argument is that once patients fail vorasidenib, there are effectively no other options. I think it's hard to argue the biology of IDH1-mutant glioma differs across geographies or ethnicities. Once they fail vorasidenib, they are in a tough position and we think providing an option is important. Our studies will include sites in Western countries as well, so it's not only in regions that are remote; we will have applicability to Western patients. We are also considering real-world evidence approaches. So it's not just only data from outside the U.S.; there will be Western data contributing as well, and we plan to engage regulators with the totality of evidence.
Your next question comes from the line of Yaron Werber with TD Cowen.
Maybe as a follow-up, David: for the study in vorasidenib failures, how fast do you think you can enroll that? For FDA accelerated approval, should we expect that you need a 12-month DOR or is six months the bogey? Is 40 to 50 patients the right ballpark that would be amenable to filing?
We think that the 50 to 77 patient number is in the ballpark; we won't know until we have the data and take it to FDA. There are precedents with 50- and 77-patient approvals. It could be slightly bigger, but given there's nothing for these patients, the precedent suggests that number is reasonable. Regarding response rate, Chimerix was approved on 22%. Given that chemotherapy response rates in this space are single-digit, a 20%-plus response in this population would be meaningful. On duration, we think six-month DOR is a reasonable expectation for accelerated approval discussions. So, in summary: 40 to 50 patients with a 6-month DOR and efficacy greater than 20% would warrant a serious discussion with FDA in our view.
The next question comes from the line of David Nierengarten with Wedbush Securities.
Just one on the dynamics of dispersion among prescribers. When you are in the field, is there any pushback or accounts that prefer to use other ROS1 agents or have been using other ROS1 agents in the front line? And as a follow-up, are you more successful in getting accounts who were previously using agents in second line to move to prescribing IBTROZI in the front-line setting for new patients, or are there some remaining accounts that continue using other approved agents?
David, on channels and traction across different account types: we're seeing broad-based simultaneous growth across academic, community and IDN settings, and that matters because growth concentrated in a single segment can be fragile, but when it's happening everywhere at once, it reflects genuine institutional confidence. Academic accounts still represent about 50% of our business and continue to demonstrate strong adoption. Community demand has notably grown since launch, and IDNs are an accelerating contributor to demand. That combination reflects both clinical belief in IBTROZI and the work my team is doing to ensure physicians have access, support and the information needed to prescribe. Regarding conversion: of the approximately 160 new patient starts last quarter, 85% were in the first-line TKI-naive setting, so we're seeing success converting new patients to IBTROZI in the first line.
David, to emphasize Colleen's point: quarter-over-quarter for first-line patients, you're talking about roughly 30% growth. That demonstrates broad confidence in the first-line setting.
Your next question comes from the line of Silvan Tuerkcan with Citizens Bank.
This is Josh on for Silvan. Congrats on the progress. As you look to build on these strong results, any insights you can share on repeat prescriptions and how that is tracking with the low discontinuation rate you saw in TRUST-I and TRUST-II? Also, can you reiterate the status of the EU application? I think it was validated in March. Is the expectation for a standard review time in the EU and the milestone thereafter?
When KOLs have used IBTROZI and then get another ROS1 patient, they've been very likely to re-prescribe it. We've seen substantial re-prescription because of appreciation for durability and tolerability, and most physicians make treatment decisions based on durability. Philippe, do you want to comment on Eisai and the European timeline?
Yes. We expect approval in Europe in the first half of next year, likely late Q1 to early Q2, and that approval would trigger a $30 million milestone from Eisai. It's a standard review and everything is progressing well; we have no concerns at this time.
Josh, one more on discontinuation: adverse event-driven discontinuations remain low and consistent with our clinical trial data, which supports repeat prescriptions and persistence on therapy.
Your next question comes from the line of Boris Peaker with Jones Research.
Great. Congrats on the progress. On ROS1 testing: you mentioned community settings aren't aggressive at testing. Is that primarily lack of awareness, or are there other incentives that make them less likely to test? Are there logistics hurdles or reimbursement pushbacks you're seeing?
It's hard to generalize. A fair amount of it is lack of awareness. We don't have complete visibility into all the incentives driving behavior within any practice, but in 2026 it's hard to argue that genetic testing for lung cancer isn't appropriate. This is now a highly treatable subset of lung cancer when a precision mutation is present. Some practitioners, particularly those who practiced during earlier eras when lung cancer prognoses were uniformly poor, may not have fully assimilated the pace of therapeutic change, so education is critical.
Boris, I would add that oncologists generally have good intent. We're focused on improving the effective testing rate, which is not just performing the test but ensuring the right RNA-based test is used, that the test result is received and understood by the care team and that it is acted upon appropriately. That's what we're working to influence.
There are no further questions at this time. I will now turn the call back to David Hung, CEO, for closing remarks.
Well, thank you all for attending. We're very excited about the quarter. We think things are going extremely well. We are really enthusiastic about what we're seeing in first line, which is the main driver of our model of revenue stacking. We think the safusidenib program is progressing well now that we are expanding into all these indications. Our financing puts us in a very strong position. We're going to be talking about our DDC platform shortly. I think we're firing on all cylinders. I want to thank you all for your support, and we'll see you at the next call.
This concludes today's call. Thank you for attending. You may now disconnect.