Nuvation Bio (NUVB) Q2 2026 Earnings Call Transcript

Image source: The Motley Fool.

DATE

Thursday, Aug. 6, 2026 at 8 a.m. ET

CALL PARTICIPANTS

• Vice President of Corporate Development and Investor Relations - Robert DeVita
• Founder, President and Chief Executive Officer - David Hung
• Chief Commercial Officer - Colleen Sjogren
• Chief Financial Officer - Philippe Sauvage

TAKEAWAYS

• Total Revenue -- $31.7 million, exceeding analyst estimates and including $23.2 million in product revenue alongside $8.5 million from collaboration and license agreements.
• IBTROZI Net Product Revenue -- $23.2 million, growing 25% quarter over quarter driven by increased adoption in the first-line setting.
• New Patient Starts -- Approximately 160 patients, with 85% of these starts occurring in the first-line setting compared to 30% at the time of launch.
• First-Line Growth -- 30% quarter-over-quarter increase in new patient starts among TKI-naive individuals, reflecting physician confidence in long-term durability data.
• IBTROZI Clinical Efficacy -- 90% confirmed overall response rate and a median duration of response of 49.7 months in TKI-naive patients from the TRUST-I study.
• Safusidenib Clinical Activity -- 51.9% centrally assessed overall response rate in Grade 2 IDH1-mutant glioma patients, with responses continuing to deepen over a median follow-up of 38.8 months.
• Safusidenib 36-Month PFS -- 79.1% progression-free survival rate at 36 months, which management compared to 52% observed in a competitor's study.
• Net Loss -- $62.8 million, or $0.18 per share, compared to $59.0 million, or $0.17 per share, in the prior year period.
• Total Operating Expenses -- $73.3 million, consisting of $30.7 million in research and development and $42.6 million in selling, general, and administrative costs.
• Cash and Marketable Securities -- $661 million as of June 30, 2026, providing a runway to reach profitability and fund the anticipated launch of safusidenib.
• Convertible Debt Financing -- $279.1 million in net proceeds from a 0.75% coupon convertible senior notes offering due 2032, which was fivefold oversubscribed.
• Debt Prepayment -- $58.7 million used to voluntarily prepay outstanding term loans, reducing interest expense compared to previous financing arrangements.
• Capped Call Transaction -- $10.458 per share initial cap price, representing an 80% premium to the closing price to reduce potential dilution upon conversion of the notes.
• Gross-to-Net Deductions -- 30%, which remained stable and is expected to stay consistent as the payer mix matures.
• Collaboration Revenue -- $8.5 million, primarily driven by product supply and royalty revenue from Innovent Biologics and Nippon Kayaku.
• EU Approval Milestone -- $30 million potential payment from partner Eisai, expected upon the possible European approval of IBTROZI in the first half of 2027.
• Market Expansion -- 20% growth in the total number of ROS1-positive patients receiving any TKI in the first-line setting from the launch through May 2026.
• Hepatotoxicity Incidence -- 88% of patients experienced increased AST and 85% experienced increased ALT, with Grade 3 or 4 elevations occurring in 10% and 13% of patients, respectively.
• Testing Penetration -- 100% in academic settings versus 50% to 80% in community centers, prompting management to launch initiatives to raise awareness of genetic testing.
• CNS Safety Profile -- Zero warnings for central nervous system adverse reactions on the IBTROZI label, which management noted distinguishes it from other brain-penetrant ROS1 TKIs.
• Safusidenib Expansion Studies -- Initiation of the G307 Phase III trial outside the U.S. and the G209 Phase II trial for patients who have progressed after treatment with vorasidenib.

Need a quote from a Motley Fool analyst? Email pr@fool.com

RISKS

• CFO Sauvage stated, "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," noting that the pool of previously treated patients is being depleted.

SUMMARY

Management reported significant growth in the first-line adoption of IBTROZI, which now accounts for the majority of new patient starts and market leadership in the ROS1 TKI space. Nuvation Bio Inc. (NYSE:NUVB) transitioned its strategic focus toward expanding the patient pool through improved testing awareness and disrupting established prescribing patterns in community settings. Operational highlights included the expansion of the safusidenib clinical program into two new studies targeting the broad landscape of IDH1-mutant glioma. Financial activities focused on strengthening the balance sheet through a convertible debt offering to retire higher-cost debt and provide capital for clinical milestones.

• CEO Hung stated, "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."
• The company reported that IBTROZI is the only brain-penetrant ROS1 TKI currently lacking a CNS warning on its label, which CEO Hung characterized as an exceptional clinical safety data set.
• CFO Sauvage indicated that the $279.1 million convertible debt offering was entirely opportunistic, as the company believed it already had sufficient capital to reach profitability.
• Management is targeting 2029 for data from the Phase III SIGMA and G307 trials, while utilizing tumor growth rate as an early surrogate marker in Phase II exploratory cohorts.
• Commercial teams are executing initiatives to disrupt the habitual use of chemotherapy and immunotherapy in community practices that persist despite updated NCCN guidelines.
• Partner Eisai submitted a Marketing Authorisation Application in the UK, with management expecting standard review times and a possible approval in the first half of 2027.
• CEO Hung noted that 88% of patients reported improved or stable quality-of-life scores during treatment, with cognitive function remaining stable over the course of IBTROZI therapy.

INDUSTRY GLOSSARY

• DDC platform: Drug-drug conjugate platform engineered to deliver therapeutic inhibitors in conjunction with anti-cancer warheads.
• DOR: Duration of response, the length of time a tumor continues to respond to treatment without the cancer growing or spreading.
• Glioma: A type of tumor that occurs in the brain and spinal cord, frequently harboring IDH1 mutations.
• IBTROZI (taletrectinib): An oral, CNS-active, selective next-generation ROS1 inhibitor approved for metastatic ROS1-positive NSCLC.
• IDH1: Isocitrate dehydrogenase-1, a gene that when mutated can lead to the development of certain types of brain and blood cancers.
• ORR: Objective response rate, the proportion of patients with a reduction in tumor size of a predefined amount.
• PFS: Progression-free survival, the length of time during and after treatment that a patient lives with the disease but it does not get worse.
• RANO criteria: Response Assessment in Neuro-Oncology, a standardized set of criteria for assessing tumor response in clinical trials for brain cancer.
• ROS1: A gene that can fuse with other genes to drive the growth of some non-small cell lung cancers.
• Safusidenib: An investigational, oral, brain-penetrant inhibitor of mutant IDH1 currently in clinical development for glioma.
• TKI: Tyrosine kinase inhibitor, a type of targeted therapy that blocks specific enzymes to help keep cancer cells from growing.

Full Conference Call Transcript

Operator: 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. [Operator 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.

Robert DeVita: 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.

David Hung: 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 3 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 to our knowledge has not been shown by any approved therapies in and durability profile 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 3-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 or ASCO 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 4-year DOR to 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. And 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 3 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.

Importantly, 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 4 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.

This is a helpful slide that shows which subgroups are being addressed by our 4 clinical studies. 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 3 of the 4 segments of the glioma opportunity. We recently announced 2 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 2 Phase III studies, SIGMA and G307 have PFS as their primary endpoint with data expected in 2029, we now also have 2 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 5x 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.

Colleen Sjogren: Thank you, David, and hello, everyone. 4 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. And 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 4-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 1. 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 the 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 4-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.

Philippe Sauvage: 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 6 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 6 months of 2026, primarily reflecting investment in the TRUST and safusidenib clinical development programs, including SIGMA and preparation for the 2 newly announced studies.

SG&A expenses were $42.6 million for the quarter and $80.9 million for the first 6 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 5x 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 approach 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.

David Hung: 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.

Operator: [Operator Instructions] Your first question comes from the line of Farzin Haque with Jefferies.

Farzin Haque: Congrats on the progress. Maybe related to IBTROZI, like what is your read on the GSK's Jideytro pricing at roughly 8% higher than IBTROZI? They also have like the CNS AEs and pancreatic tox on the label. That was a bit surprising to us. But the label does not explicitly say that they excluded the concomitant driver mutations. So to what extent do these label differences influence your commercial message?

David Hung: 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, seizure. These are things that I don't think we expected. We had not seen that previously.

And as I said in the script, 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 precaution. The other thing that we were, I think, 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, 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 of 1/4 of what we had with IBTROZI. And we know that adverse events are linearly correlated with length of follow-up. So when we look at all these numbers with 1 quarter of our follow-up period, we would expect since they're linear that when these -- when the follow-up reaches the length of IBTROZI's follow-up, we would expect these AEs to potentially quadruple. 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 comparison, of course. But in the second-line setting, the ORR for zidesamtinib was 49%.

In our JCL pool data, it was 56% and maybe the most important, 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%, 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, and 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.

Philippe Sauvage: Yes, just like you, I guess, my reaction was very much about this is a pricing strategy for later line drug, which kind of makes sense considering we are a first-line drug and they are not. It's a later line approval. We made at the time of the launch, as you remember, 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 through a different direction with a higher price, which is more aligned with the later line drug strategy. I don't have any more insight than that, but that was the first thing that came to my mind.

David Hung: 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 15-month duration of response. 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 well beyond that, 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 that we -- the last card is on the table, I think we feel very confident of our position in ROS1.

Operator: Your next question comes from the line of Gregory Renza with Truist Securities.

Gregory Renza: Congrats on the quarter and progress. David, maybe just to follow up on the GSK approval and launch. You talked about some of the -- maybe the surprises and just the positioning with IBTROZI now against the latest entrant. I'm just curious with respect to the early approval earlier than the anticipated PDUFA, how has that sort of informed and maybe altered the tactical plan with Colleen and the team, just given it has come to market sooner than expected? And then just secondly, maybe as a follow-up and looking longer term, as you contextualize this market, in that theoretical fashion, the longer-term patient stacking opportunity into the launch.

How has the 1 year under our belt really helped to maybe 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 IBTROZI?

David Hung: Thank you. Let me start, and then I'll turn it to Colleen. So 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 of what we were competing against, and it was actually helpful for us to see the label early. And as I said, that it 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 1, even though we -- of course, 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. And if you look at new patient starts diminishing somewhat 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.

And the fact that we are now 85% of first-line patients, that's we're pretty pleased about that. And I think that we would expect -- I think I said on the last quarter call that this was going to be a biphasic NPS number. You start with a pool, you start treating through it, that number is going to diminish and then you're going to 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, more people use the markets grow, number one.

Number two, we know that testing is going to increase. That's a general thing -- a trend in the entire industry, not just for us, but for all precision oncology. We know that's going to happen. Number three, within the testing, even if you have a positive test, we still know that IO chemo is still being used a lot more than it should be. But remember that the NCCN guidelines that contraindicate IO only came out on January 7 of last year. So that's about 1.5 years ago. So even though IO chemo has been used for years and years in ROS1, it's not the right therapy.

NCCN finally came out with the right physician to contraindicated, but physician change in behavior is not immediate. That's happening. That will continue to switch. We will continue to see even with testing what we call effective testing so that we will switch from not just having a ROS1 patient that's diagnosed, but then goes on IO. Now those patients who are diagnosed will get on the appropriate ROS1 TKI, and we don't think there is a ROS1 drug better than IBTROZI in that regard.

And then the last point is that as we shift from DNA to RNA testing, we will also see about hopefully a 30% or so increase in the number of diagnoses because RNA is about 30% more sensitive than DNA identifying ROS1 fusion. Colleen, I'll turn it back to you.

Colleen Sjogren: Yes. I think that you just asked one of the most important questions in the launch right now and asking about sort of this first-line shift in revenue stacking. I'm actually glad you asked it. So when we look at the earlier line patients and looking at earlier line patients responded at higher rates, they obviously tolerate our therapy better. They're staying on treatment significantly longer. And when we look at IBTROZI specifically, when we talk about demonstrating a median duration of response of 50 months in the TKI-naive patients, and then we compare that to the later-line patients where disease progression, they've been on many prior different therapies and that's really their primary driver of discontinuation.

So when we look at each sort of successive cohort of first-line patients and they begin their therapy and they remain on therapy, that's what creates for us this compounding base of active patients. So that's what's building our revenue over time. So when we look at the 25% of sequential growth for the revenue that we've delivered this quarter, while managing the natural transition away from these later-line patients, that's early evidence of the dynamic beginning to play out. So David mentioned this, too, but we really are starting to build a chronic disease model and the shift in patient mix is really the foundation of that.

Philippe Sauvage: 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, as you noted yourself, is that our late-line patient pool has already been depleted from our perspective. All those patients have been -- 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 that 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, it 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 launch, which I think is really, really important for us.

Operator: Your next question comes from the line of Mayank Mamtani with B. Riley Securities.

Mayank Mamtani: Congrats on a strong quarter. I was just curious against the roughly 750 newly diagnosed front-line patients, there's still a lot of capture rate you can grow here, Colleen, and David. I was just curious, any testing initiatives you're involved with directly? And how can we see this penetration kind of move up? I know you talked about some IO plus chemo trend, but just the underlying testing, how that can grow? That was question number one. And I do have a follow-up on the [ SIGMA ] program.

David Hung: Mayank, let me start, and I'll turn to Colleen. So when we started off in our launch, we made the comment that if you look at the academic setting, testing rates are nearly 100%, and they are. But if you look at community centers, depending on the community center, while some can have pretty high testing rates in the 80% plus range, there are some that have testing rates of 50% or even lower. So we've actually met with many of the larger community oncology aggregators who have low testing rates and embarked upon projects to point out to them their testing rates.

And interestingly, many of them were surprised at their own testing rates, they actually internally had thought they were higher, but they weren't. And by raising that awareness, we were able to, in several centers, more than double their testing rate just so far. And we think that, that's something we're going to continue to do. So we're trying to point that out. The other thing we're trying to point out to these same centers is that some of them have much higher IO chemo use than they would have actually thought. When we talk to the management, they think it's low. We actually look to the data and the electronic medical records, they're actually much higher.

Again, a surprise to even their own institution, and we've been pointing that out to them as well, and that's also helped. Colleen?

Colleen Sjogren: Yes. So Mayank, thank you for that question because it's really insightful. And it's a real dynamic across targeted therapies in lung cancer. And I want to be very clear, we're not dismissive of it. So despite NCCN and ASCO guidelines specifically recommending against chemo with or without the use of IO and recommending targeted therapies such as IBTROZI for our ROS1-positive patients, it's that habitual prescribing pattern in the community that persists. So you asked about what we're looking to do. So we have several targeted specific initiatives to disrupt this cycle specifically and have direct partnerships with community practices.

We have patient identification programs and different tools that are making it easier for physicians to identify and flag these mutations and make sure that the mutational status is flagged before defaulting and making a treatment decision in that first line. So -- and as David mentioned, on the testing side, obviously pushing and advocating for the RNA-based testing. We know in the publications that it shows to have a significantly improved detection rate upwards of 30%. So we -- as I said, insightful question. We see it across lung cancer, but we are addressing it head on, and we believe that we are making extremely good positive progress for these patients.

Philippe Sauvage: Mayank, we have one more thing, which Colleen alluded to, if you can hear me, Mayank, which Colleen alluded to, which I think is really important that the point you're making is so important for patients but it goes beyond ROS1, many targeted oncology. There is still a lot of efforts to do. And if you were at ASCO, like we were, you saw the big push from our colleagues at Pfizer for -- in [ ALK ] because those problems exist there as well. It's really something that we all have collectively to do for patients in the U.S., make sure everybody important -- understands the importance of testing, being properly tested and identifying those mutations.

David Hung: And let me make one other point. I've said that good drugs grow markets. And if you look at IO chemo and the PFS for IO chemo, which is used -- has been used for a decade or forever. The PFS of IO chemo is about a year or less. So if you look at one of the first early ROS1 TKIs entrectinib, well, their PFS is 16 months. One could argue that 16 months is not that different than 12 months. So back then, when that was your option, how compelling it was to necessarily use a ROS1 TKI over IO chemo wasn't the same level. It was just not as compelling an argument.

You can make the argument, but it was closer. Now when repotrectinib came out with a 36-month PFS, 34-month duration of response, that significantly changed the bar, and that was really when the NCCN changed their guidelines. It was really based on the repo data. But now with the IBTROZI'S data of 50-month DOR, it's virtually impossible to make that clinical argument. Now you're talking about years of life difference. So the necessity for testing just got greater because you can do more about it. And so this is what I meant when I said good drugs change markets, and that's what we're already seeing now.

And we go into these centers, those who used to use repotrectinib, repotrectinib even get to the brain, entrectinib has a pretty short PFS, they get it. And now things are changing. It's not overnight, but this is why when I say good drugs grow markets, they do, and we're already seeing that.

Mayank Mamtani: Just very quickly on the [ G209 in glioma ], obviously, a lot of investor interest there and expanded program. Just very curious to hear the post vora cohort you've added? And maybe just talk to a little bit about your expectation on the data there itself and how big the population you intend to have exposure there where maybe engaging with regulators would make sense?

David Hung: So if you look at Servier's statements in the last quarter about how many patients were on vora, they said over 5,500 patients were on vora, not clearly, that number is even higher with the latest quarter. And if you look at the initial INDIGO study, 23% of those patients progressed at 1 year. So since vora has now been out for over 1.5 years, we would expect about 1/4 of those patients to be failing or already having failed. So that's -- we're talking about 1,250-plus patients who have probably already failed or failing vora. And so that speaks to 2 things. Number one, it speaks to how large the unmet need is.

If you look at the duration of response of vora, even though it is the best thing in glioma currently, the duration of response is not 80% at 3 years like we've seen in our J201 study. So there is a need for a longer, more effective therapy, and that's what we're developing safusidenib. So we do think that it speaks to the importance of the unmet need of this market, but it also speaks to the feasibility of enrolling that study because there are so many patients now who are failing vora. We've said before, if you look at the precedent of other companies in the space, Chimerix got approved on a 22% response rate in 50 patients.

So that would basically be 11 patients out of 50 to get a response. So I don't know if that's the number. Ojemda did it in 77 patients, but somewhere between, let's say, 50 and 80 patients. 20% of that is somewhere between maybe 10 to 15 patients. That's what we're looking for, for a response rate that we think could allow us to take a package to FDA to start discussing what the regulatory approval strategy could be. We think that's not only exciting, but not that far away. And on top of that, we made -- I made a comment in the script about this new endpoint, tumor growth rate.

So before tumors can shrink, it's got to slow down. It doesn't just go from growing to shrinking. It plateaus and then -- so the slope is positive, then it becomes more neutral and then it goes -- becomes negative, right? So by definition, you have to go to a -- you have to change your tumor growth rate before you can get a response. And in all of our responders in the safu study, we saw a shift in the slope of TGR.

So we can tell when patients are slowing down and when -- and we believe that depending on the rate of slowing and the magnitude slowing, we can predict [ because ] likely want to have a response. So that's potentially even earlier readout than ORR in seeing if safu has activity. So we think that's another important point. And in fact, even though it's not currently a regulatory endpoint, in many ways, I think it's legitimate. A tumor that's slowing down and then shrinking it's probably pretty important to a patient. So if it isn't a current regulatory endpoint, in our opinion, it should be considered, and that's a discussion we intend to have with FDA.

Operator: Your next question comes from the line of Michael Yee with UBS.

Matthew Hagood: This is Matt on for Mike. Congrats on a nice quarter. Maybe one more on the IDH1. I just wanted to ask kind of what gives you confidence that the FDA would be amenable to filing in low grade using the OUS data. Do you think you will need to supplement with some U.S. data? Or I guess I'm asking kind of how do you think that's going to play out in that low-grade setting around that placebo-controlled study?

David Hung: Well, the most compelling argument is that once they fail vora, there's nothing. So there is no option. I think that there is no evidence that the biology of IDH1-mutant glioma is different across geographies or ethnicities. And once they fail vora, they're in a really, really tough position. So I just -- I find it hard to imagine why anyone wouldn't want to give patients that option. They have nothing left. If you're talking about trying to go for radiation or chemo, which is single-digit response rates. And by the way, that isn't benign. There's only so much radiation you give any brain. At some point, you're killing regular brain in addition to your tumors.

You just can't keep doing that. So -- and on top of that, our studies actually do have sites in Western countries. We're not -- there will be areas where we can enroll these patients even in the U.S. or Western countries. And so we are looking at real-world evidence approaches here. So it's not going to just be only in remote countries that don't have applicability to Western patients.

Operator: Your next question comes from the line of Yaron Werber with TD Cowen.

Yaron Werber: Great. Maybe just a question as a follow-up, David. The study in the vora failures, how fast do you think you can enroll that? And then for FDA for an accelerated approval, should we sort of expect that you need to have a 12-month sort of DOR or is 6 months sort of the bogey? And are we still thinking about the sort of 40 to 50 patients is the right bogey that would be amenable to filing?

David Hung: We think that, that 50 to 77 patient number is in the ballpark. We won't know until we've done it because we have to take the data to FDA and they said they want to see it. But if you look at the 2 precedents, they've actually approved 2 drugs based on one on a 50-patient study, one on a 77-patient study. So they've done it before. We think that's a reasonable ballpark. Could it be slightly bigger? I guess it could be. I'm not sure why it would be because there is nothing for these patients. In terms of response rate, as I said, Chimerix was 22%.

We think that's -- given the fact there's nothing there in chemo is, what, 8% or less response rate. I think I just think that, that's -- we think it's going to be in that ballpark. So I can't say that we know that to be true. But from our preliminary discussions, I think that's probably clearly in the ballpark. On duration, we think 6-month DOR. So that's what we have so far. Of course, they've said they want to see the data.

But from their discussions with the FDA so far, we think in the range of 40 to 50 patients, 6-month DOR, efficacy greater than 20%, we think that is -- that would warrant a really serious discussion on approval.

Operator: The next question comes from the line of David Nierengarten with Wedbush Securities.

David Nierengarten: Just one on the dynamics of the kind of dispersion amongst prescribers. Just 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 to that idea, are there -- are you more successful in getting the accounts who have been in second line to move to their front-line setting in new patients? Or are there some remainders who are using other approved agents?

Colleen Sjogren: Yes. David, so what I can tell you, let's first look at just go to channels. You asked about traction in the different channels. So we're definitely seeing a broad-based simultaneous growth across all 3 of the settings. And why that matters is when growth is just concentrated, as you know, in one segment, that's where it's kind of fragile and you get concerned. So when it's happening everywhere at once, which is what we're seeing, it's really reflecting genuine real institutional confidence. So the academic accounts, they still represent about 50%, as David said, of our business, and they continue to demonstrate strong adoption across many of the leading cancer centers. So we're seeing that strength continue.

And then what's really great is community demand has grown notably since launch. So we're really seeing traction picking up there. When we look at sort of the IDN accounts, they now are also a meaningful and accelerating contributor to our demand. So again, all 3 combined signal such a healthy growth and trajectory for our launch. So -- and we talk about this a lot, but that combination does reflect both the clinical belief in IBTROZI's profile and the work that my team is doing to ensure that these physicians have the access support and all the information they need to prescribe.

So when we see sort of that base growing in the way that it is collectively across all 3 channels, it gives us incredible confidence. And to your other question, when you're asking about converting, when we look at that 160 of last quarter and talk about the importance of the composition, 85% of those 160 are now in that first-line TKI-naive setting. So we're seeing success there, too, and our team is doing a great job conveying our message there.

Philippe Sauvage: David, just to keep that in mind because it's so important for the confidence in the drug. Quarter-on-quarter for first-line patients, you're talking about 30% growth. So the confidence is broad for the first-line patients, 30% growth quarter-on-quarter on first-line patients. So it's really important to keep in mind.

Operator: Your next question comes from the line of Silvan Tuerkcan with Citizens Bank.

Joshua Werman: This is Josh on for Silvan. Congrats on the progress here. Yes. I mean, I guess you already touched a little bit on the revenue stacking. But I guess as you look to build on these strong results, do you have any insights you can share on repeat prescriptions and how that sort of is tracking with the impressively low discontinuation rate that you saw in TRUST-I and TRUST-II? And can you also just reiterate the status of the EU application, which I think was validated in March maybe. So is the expectation for a standard review time in the EU and the milestone following thereafter?

David Hung: What I can tell you is that we had -- we met with a ton of KOLs at ASCO and like any drug, you don't know until you know. And when KOLs have used IBTROZI, we have found that when they do get another ROS1 patient having used IBTROZI, they're very, very likely to re-prescribe it. In fact, we've seen that a ton. So we've seen such appreciation for the durability in particular as well as tolerability, but most physicians make their treatment decisions based on durability. It's hard to argue for anything else. So when patients have used IBTROZI and find it as tolerable as it is, given the DOR, we see a ton of re-prescriptions for new patients.

And I think that's what we're most heartened by. Philippe, do you want to comment on the Eisai?

Philippe Sauvage: Yes. We messaged to your point about that prior. We expect first -- an approval in the first half of next year. We said probably late Q1, early Q2 maybe, so first half of next year. And that will trigger, as we said, a $30 million milestone from Eisai. It's the standard review, but everything is progressing very well, and we have no concern for now.

Colleen Sjogren: And Josh, just one more addition to that. You talked about discontinuation. So obviously, that obviously is also an indication of repeat prescriptions and refills. So when you look at our adverse event-driven discontinuations, they do remain low, and they remain in line with our clinical trial data. So the direction of this dynamic is exactly where we want it to be. And so I think that, that just speaks to, again, the persistence of the patients staying on therapy.

Operator: Your next question comes from the line of Boris Peaker with Jones Research.

Boris Peaker: Great. Let me add my congratulations on the progress. Just a question on ROS1 testing. So you've mentioned that community settings, some are not aggressive at testing. I'm just curious, is it just lack of awareness? Or are there maybe some other incentives is why they don't bother with testing? Are there any logistics hurdles or reimbursement pushbacks that they're dealing with? Curious what you observed there.

David Hung: It's really hard to know. I would say I think a fair amount of it is still just lack of awareness. We don't have complete visibility to all the incentives that drive behavior within any practice. But I think that in 2026, it's hard to argue that any other behavior other than genetic testing for lung cancer is appropriate. This is the most treatable cancer on the planet. If you have a precision oncology mutation, I think that we just need to impress upon people that fact. I think there's still -- especially maybe among older practitioners, only 15 years ago, lung cancer was considered a smoker disease and incurable. And no matter what you did, it was poor prognosis.

That's changed in the last 15 years, but not everybody knows that.

Colleen Sjogren: Yes. And I would just add to that, Boris. We believe at heart, oncologists have good intent. They have good intent. We talk about this effective testing rate, and that's where we're trying to educate and improve. So it's not only having that test performed, it's advocating for the RNA, which is more sensitive to the ROS1 fusion pickup. But then the effective testing rate goes all the way through the treatment decision. So making sure that, that test is received, it's understood by the care team within that office, and it's acted upon appropriately when these patients have an active mutation. That's really what we're trying to influence the effective testing rate of these patients.

Operator: There are no further questions at this time. I will now turn the call back to David Hung, CEO, for the closing remarks.

David Hung: Well, thank you all for attending. We're super 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. And we think that the safu program is really flying now that we are in all these indications. So we're pretty excited about where we are. Our financing puts us in a very strong position. We're going to be talking about DDC shortly. So 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.

Operator: This concludes today's call. Thank you for attending. You may now disconnect.

This article is a transcript of this conference call produced for The Motley Fool. While we strive for our Foolish Best, there may be errors, omissions, or inaccuracies in this transcript. Parts of this article were created using Large Language Models (LLMs) based on The Motley Fool's insights and investing approach. It has been reviewed by our AI quality control systems. Since LLMs cannot (currently) own stocks, it has no positions in any of the stocks mentioned. As with all our articles, The Motley Fool does not assume any responsibility for your use of this content, and we strongly encourage you to do your own research, including listening to the call yourself and reading the company's SEC filings. Please see our Terms and Conditions for additional details, including our Obligatory Capitalized Disclaimers of Liability.

The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.