Q4 2023 Insmed Inc Earnings Call

Participants

Sara Bonstein; CFO; Insmed Incorporated

Bryan Dunn; Head of IR; Insmed Incorporated

Will Lewis; President, CEO & Chairman; Insmed Incorporated

Jennifer M. Kim; Analyst; Cantor Fitzgerald & Co.

Tiago Fauth; Analyst; Wells Fargo

Andrea R. Tan; Analyst; Goldman Sachs Group, Inc.

Joseph Schwartz; Analyst; Leerink Partners LLC

Ritu Baral; Analyst; TD Cowen

Simeon Gutman; Analyst; Guggenheim Partners

Jeff Hung; Analyst; Morgan Stanley

Liisa Bayko; Analyst; Evercore ISI Institutional Equities

Stephen Willey; Analyst; Stifel Nicolaus and Company, Incorporated

Leiyang Wang; Analyst; Barclays Bank PLC

Andy Chan; Analyst; Wolf Research

Jason Zemansky; Analyst; BofA Securities,

Vamil Divan; Analyst; Guggenheim Securities, LLC

Presentation

Sara Bonstein

Good day and welcome to the Innospec, Inc., fourth-quarter and full year 2023 financial results conference call. (Operator Instructions) I would like to advise all participants this call is being recorded. Thank you. I'd now like to welcome Brian Dunn, Head of Investor Relations to begin the conference. Brian, over to you.

Bryan Dunn

Thank you, Gavin. Good day, everyone, and welcome to today's conference call to discuss Insmed's Fourth Quarter 2023 financial results and provide a business update. I am joined today by Will Lewis Chair and Chief Executive Officer, and Sarah bonds day and Chief Financial Officer, who will each provide prepared remarks before we open it up for your questions. Before we start, please note that today's call will include forward looking statements based on our current expectations. These statements represent our judgment as of today and inherently involve risks and uncertainties that may cause actual results to differ materially from the results discussed. Please refer to our filings with the Securities and Exchange Commission for more information concerning the risk factors that could affect the company. The information on today's call is for the benefit of the investment community. It is not intended for promotional purposes. It is not sufficient for prescribing decisions. I will now turn the call over to Will Lewis for prepared remarks.

Will Lewis

Thank you, Brian, and good morning, everyone. I'm pleased to be speaking with you today at the start of what I believe will be a uniquely transformational year for Insmed's in just the next few months. We expect meaningful data readouts and other relevant updates from across our late-stage portfolio, the results of which could fundamentally change that trajectory for our company and the patients we serve. We've been carefully preparing for this moment for a long time and we are ready for it.
It has said the great drugs tend to announce themselves early ARIKAYCE, brensocatib and TPIP have been showing us compelling signs of their potential from the earliest data points coming out of their respective programs. And I couldn't be more excited to see what they will show us next, if they are successful, we believe that they collectively represent more than $8 billion in peak sales potential, a staggering opportunity for any company, but especially one our size.
In fact, we believe that any one of these assets, even without the other two, could form the basis of a successful biotech company, I have never been more confident in the future of Insmed that I am today. But before I get to the future, let me spend just a moment on our fourth quarter performance. Our case sales in the quarter once again set a new record and caused us to exceed our increased guidance range for 2023. Importantly, this result reflects not only the continued strong demand for ARIKAYCE, but also the effectiveness of our sales personnel and interest structure in the US., Japan and Europe.
As I continue to see our commercial team outperform expectations, it gives me greater confidence and the ability to realize the commercial potential of brensocatib. These same colleagues will be leading that launch if the assay results are positive and there will be able to leverage many of the same call points and relationships that they have already spent.
As you will hear about in a moment from Sara, in the fourth quarter, we used our at-the-market equity offering program or ATM to essentially keep our cash balance flat compared to the prior quarter. This was important strategically because it further resources the company as we near the important clinical readouts ahead, leaving us with more than three-quarters of a $1 billion on hand as we enter 2024.
Let me start with an update on ARIKAYCE. We continue to be excited about the strong results shown in our Phase three ARISE trial in patients with newly diagnosed or recurrent NTM MAC lung disease, who have not started antibiotics, which read out last year. More detailed results from this trial are now expected to be presented at the ATS conference in May, which we anticipate will reinforce the excitement that was generated with the top line data set.
As I've mentioned previously, we have been engaging with the team of experts at the FDA review patient reported outcome tools used in clinical trials. After having received encouraging written feedback late in 2023 w e expect to meet with them in the coming months to glean any additional feedback and guidance that they may have before finalizing the statistical plan for our Phase three confirmatory ENCORE study, we will present provide you with additional updates once that work is complete.
Only after all of that feedback is received and incorporated into our plans, would we be in a position to approach the FDA about whether there could be an accelerated approval pathway under Subpart H using the ARISE data to expand the ARIKAYCE label to include all patients with NTM MAC lung disease. As we've said before, we believe that the most likely out some of these discussions is that our ongoing Encore trial will be required for filing.
I'm happy to report that the Encore trial itself is progressing as planned. The Data Safety Monitoring Committee held its third safety review meeting in November and recommended that the trial continue unaltered. There are no interim reviews for either efficacy or futility and this studies protocol. So this represents the most positive outcome possible.
Importantly, enrollment and Encore remains strong. We continue to expect top line results in 2025.
Next, let me give you an update on brensocatib. The highly anticipated Aspen readout continues to progress as we had hoped and remains on track to read out in the latter half of the second quarter. Last month, I laid out the different scenarios that would result in us moving forward with regulatory filings for brensocatib in bronchiectasis.
Let's take a moment to review those again, if either dose achieved an adjusted p-value of less than 0.01 on the primary endpoint of reducing the rate of pulmonary exacerbations, that would be a very clear win. And if either dose achieved an adjusted p-value of less than 0.05, we expect to also move forward with the filing. None of that has changed, but let me offer an additional point of clarity on how we will measure success for this trial. We have heard from payers, KOLs and patients alike that achieving a reduction in the rate of pulmonary exacerbations of around 15% would make brensocatib and attractive treatment option for patients with bronchiectasis. So particularly in a situation where the reported p-value is higher than 0.01, but less than 0.05, we would ideally like to see a treatment effect of at least 15% .
If the magnitude of the effect is at that level or higher than I think we have a drug that is not only approvable, but also potentially one that will drive rapid uptake in a market but with no approved treatments. As a reminder, we have said that we believe this drug has a peak sales potential of greater than $5 billion. Presuming Aspen is a clear success, and that is just for the two indications that we are currently pursuing bronchiectasis and CRS without nasal polyps and just in the geographies where we currently operate.
In fact, the closer we get to a readout, the more confident and excited w e feel. We continue to hear anecdotal reports from sites across the world of patients in the trial, doing better with fewer exacerbations and sputum that is thinner and lesser in volume compared to before starting the trial. Of course, we have to acknowledge that the investigators who are providing us these updates remain blinded just as we are to which patients are on brensocatib in which you're taking a placebo. But even so we believe it is an encouraging sign.
We also have been closely monitoring exacerbation rates by region country and even individual trial sites throughout the course of trials conduct. So we know that events are occurring at rates that are in line with our expectations and consistent with the treatment effect that the study has been designed to demonstrate. We have also now been through five into dependent safety monitoring meetings, all of which have resulted in no safety concerns and unanimous recommendations to continue the trial without any alterations. All of these indicators add to our enthusiasm for Aspen's readout.
Indeed, if one simply walk the halls it in, some of it is difficult not to notice and almost palpable excitement amongst our call rigs. That seems to grow each day as we get closer to the release of the Aspen data. We all look forward with great anticipation to sharing the top line results in the latter part of the second quarter.
Now just a quick update on our TPIP. program. Last quarter, we provided some details on the blended blended data we have been generating from our two ongoing Phase II studies have TPIP. in patients with PAH and PH-ILD. At that time, we disclosed that 8 of the first 10 patients in our PHLD. safety study, we're able to titrate up to the highest dose in the study or 640 micrograms once daily by the weak five visit.
That study is now five fully enrolled with 39 patients, and we expect the top line results in the second quarter ahead of the Aspen readout. Also on our last quarterly call, we shared that 83% of the first 24 patients in our PH study had successfully titrated up to 640 micrograms by week five. Of the 22 patients who had completed the 16-week study, we saw a 21.5% average reduction in pulmonary vascular resistance or PVR. This includes all patients those who receive TPIP. and those who received placebo in the trial that is randomized 2-to-1.
If you look at the 64% of those patients whose PVR decreased during the study, the PVR reduction was 47% on average, with several of them achieving reductions greater than 65% and approaching a range that would be considered normal for PVR. These were encouraging results, albeit blinded and in a relatively low small number of patients.
When the data for this PH. study is unblinded next year, we would view any PVR reduction above 30% as a clear best in class results and one that is potentially achievable in our view, given the blended results we have seen to this point. I also want to announce today for your planning purposes that it is our intention to share updated blinded data from approximately 40 patients in the PAH study. At the time we release the top line results from the PHILD study, which we expect will be in the second quarter before the Aspen data.
In addition, we have submitted our proposed pretty call amendment for the open label extension of the PH. study to the FDA and other regulatory authorities. This amendment once implemented would allow investigators to continue to increase the dose of TPIP. from a current max of 640 micrograms once daily up to 1,280 micrograms once daily, presuming you can revenues to be well-tolerated.
More than 90% of those who have completed the studies so far have opted to join the open label extension, which is another encouraging sign in our view. Now before I turn it over to Sarah, I want to once again highlight the unique position in which Insmed finds itself. We have spent years meticulously and deliberately constructing a company that would have multiple clinical programs with meaningful readouts over a short time window.
With the positive top line arise data in September 2023 and the TPIIP lined out expected to come in quick succession in the second quarter of this year. We hope to complete this long-term vision and establishing Insmed as a company with three compelling product profiles which may be capable of generating greater than $8 billion in aggregate peak sales.
If we are successful, I believe Insmed will undergo the type of trend information that one releases in the biotech industry. And we are now just months away from finding out. I want to be clear that the data we have observed so far across all three of our mid to late-stage programs from the reports of the independent committees that monitor safety findings to the data generated in previous positive trials. To that detailed blinded data, we continuously analyze to the positive anecdotes we hear from investigators involved in our studies only increases our confidence in the potential for a successful outcome for each of them.
I couldn't be more pleased. We're more excited with where things currently stand. I'll now turn the call over to Sarah to walk through our financials for the quarter.

Sara Bonstein

Sure. Thank you, Al, and good morning, everyone. Earlier today, we issued a press release detailing our financial results for the fourth quarter and full year 2023. I would like to highlight some details of those results from now. I am pleased to share that our year end 2023 cash position of approximately $780 million remains relatively unchanged from our Q3 cash position as we were able to offset the majority of our burn this quarter with proceeds under our ATM.
The usage of our ATM this quarter reflects the significant investor interest and building recently, I am proud that our stock increased 23% during the fourth quarter. While we are utilizing this program. While we have substantial capacity under our new ATM in the near term, we do not plan to utilize them proactively. Having spoken with many of you recently, I know that there are concerns that we may choose to do a large equity raised prior to our upcoming data readouts.
I want to be as clear as I can be on this point. Given our strong cash position, we do not currently anticipate the need for significant equity raise prior to the Aspen readout. Instead at the appropriate time, we intend to evaluate all possible options for balency documentation and choose those options that would be most beneficial to our shareholders. Patients in other states holders.
We see the sale of equity. It simply one of the many tools available to us, and it is by no means are preferred avenue for raising capital, nor do we see any need to take action in the near term. Looking at our expected cash burn in the coming year, let me remind you that our burn in the first quarter of every area of normally higher than our usual cadence due to the payment timing of annual employee incentive bonuses. Importantly, our current cash balance provides us with more than enough capital to support our operations through the expected timing of the Aspen top line results and beyond, leaving us with significant optionality on the other side of that readout.
Let me now turn to our commercial performance. Last month at an investor conference, we disclosed that our global net revenues for 2023 for $305.2 million representing 24% year over year growth and exceeding the top end of our guidance range for the year. History tells us even more impressive when you recall that this range had already been raised earlier in the year. Due to the strong performance of ARIKAYCE, we can outpace our internal expectations on a regional basis, net revenue for 2023 was $224.2 million in the US., up 21% compared to the prior year.
This growth was fueled by the strong execution of our team to continually identify new eligible patients who may benefit from ARIKAYCE treatment making 2023, the highest year of new patient starts that we've ever seen in Japan.
2023 revenues were $65.7 million, representing 16% growth over 2022. As we expected and highlighted for you previously, the pace of sales growth in Japan increased significantly in the second half of the year, going from 8% year-over-year growth in the first half to 23% year-over-year growth in the second half of 2023, despite a planned 9% price decrease that was implemented this past June.
I want to acknowledge the strong new leadership team we put in place in Japan in early 2023, which led to such a remarkable outcome this year. The quality and effectiveness of their leadership gives me continued confidence in the gross growth trajectory. For ARIKAYCE in Japan in 2024 and beyond.
In Europe and the Rest of World, net revenues in 2023 came in at $15.3 million, the strongest results in any year to pay for that region with growth being driven primarily by Germany and the UK. The performance in 2023 continues to support our view that ARIKAYCE remains in a growth phase globally. Today, we are reiterating our full year 2024 our global revenue guidance range W e gave last month of $340 million to $360 million.
As you think about the quarterly cadence for our sales this year, I will remind you about the deductible and co-pay resets for Medicare patients in the US, which typically lead to a sequential drop in sales in the first quarter compared to the fourth quarter. In addition, the timing for when hospital budgets reset in Japan commonly lead to lower first quarter sales in that region as well.
Historically, the first quarter has contributed a little over half of each year's total sales. We believe that the same dynamics will impact the first quarter of 2024. Despite this expected seasonal pressure trends coming out of 2023 were very positive, and we believe set us up well for another strong year of performance in 2024.
Let me now turn to a few additional financial items. In 2023, O ur gross to nets in the US were 15.4%, which is consistent with both our mid teen guidance range and our historical performance in 2024, we expect gross to nets will settle in the mid to high teen range due to marginal impacts resulting from the implementation of certain provisions of the inflation Reduction Act.
As in prior years. We expect the gross to nets in the first quarter of the year to be a bit higher before coming back down in the remaining quarters of the year. Cost of product revenues for 2023 was $65.6 million or 21.5% of revenue, which remains consistent with our past performance.
Turning to our GAAP operating expenses for full year 2023, research and development expenses were $571 million, and SG&A expenses were $344.5 million reflecting non-cash charges related to asset acquisition in 2023, as well as continued investor late stage pipeline.
In closing, I believe Insmed is in a very strong financial position with over three quarters of $1 billion on its balance sheet and multiple near-term clinical catalysts on the horizon. We look forward to using the resources we have to deliver on the great potential that lies ahead. Now I'd like to open the call to questions. Operator, can we take our first question, please?

Question and Answer Session

Operator

(Operator Instructions)
Jessica Fye from JPMorgan.

This is Nick on for Jess. Thanks for taking our questions to from us. First that you mentioned in the prepared remarks, but I was hoping if you could provide some additional details and maybe timelines around when you expect to have the final stat plan for Encore agreed upon with the FDA and what your latest thinking is around potentially needing or not needing to make any changes to PRO. based on a initial feedback?

Will Lewis

So that's a pretty straightforward one. I mean, we're in dialogue with FDA as soon as they are able to meet with us in person talk through the remaining elements of the PRO to their satisfaction will give that guidance out of this is one of those things where we don't have control over the the clock sort of the ball in their court. And I would just reemphasize our interactions with them to date have been very positive. Perhaps I can go into an example of a detail for for how this might unfold.
One of the questions that's contained within the PRO asks about the color of the sputum and from the PRO group that is inside the FDA, right? This is a separate group within FDA. They have been contemplating whether that is really a relevant question in the context of a patient reported outcome. So whether they keep that question or advised us not to keep that question. It makes no difference in the way we analyze what we need to do or how we're executing. And indeed, the ARISE data works both ways. We've run it both ways. So we're not concerned about it, but it is the kind of detail that we need to run to ground before we can finalize the statistical analysis plan and therefore up communicate what Encore needs to look like.
But I just would tell you we're going exactly as we expected in terms of time line and progress dialogue with FDA. I would expect this will happen in coming months and we will communicate as soon as it's available. And that would give us the opportunity once that's locked down to then returned to FDA. The review division and say do think ARISE is adequate for us to file and secure earlier approval in the all Mac NTM indication.
My hope is that they would be willing to engage there. But again, our base case is assuming that we would need Encore for full approval.

Great. And then maybe taking a step back and thinking about France. So beyond bronchiectasis, not overlook correct on has been, obviously, but how are you thinking about the level of neutrophil mediation involved in the pathology of CRS. without nasal polyps, NHS relative to bronchiectasis in terms of it being a driver of each disease?

Will Lewis

Yes. So that exactly why we've chosen these two is our second and third indications to pursue. They are neutrophil driven diseases, particularly when we talk about something like CRS without nasal polyps versus cigarettes with nasal polyps, CRS without nasal polyps has nothing approved to treat it right now. The patients we're targeting within that population or those that are undergoing quite often repeat surgeries. So the threshold here for unmet medical need is quite high. And the ability of this product to influence the inflammatory cascade by mediating that that neutrophil driven inflammation looks pretty good.
There aren't great models in the animal world for, um, CRS, that nasal polyps, which is why we really need this burden trial, the readout and we will be interpreting the Aspen data was exactly that in mind. And how much impact do we think we're having that magnitude should carry forward into other neutrophil mediated diseases like CRS. without nasal polyps and hidradenitis suppurativa or HS HS. will kick off a Phase II trial by the end of this year. Presuming that Aspen is good and that we don't learn anything that might mitigate that. Perhaps a final point of detail on the HS. study. We intend to structure it right now in a way where we will look as we go through the study to see that we are seeing some kind of response in Phase two. And indeed, if that is not a cascade that has resulted in benefit to patients, we would look to shut that study down early. But I think we're going to be in a good spot with regard to all three of these because they are neutrophil driven diseases.

Sara Bonstein

And I would just add one thing just to remind folks that are bronchiectasis is obviously a very significant market opportunity. Crs is also a very significant market opportunity. 26 million patients diagnosed with CRS. about nasal polyps in the US. alone. While we will obviously target that more severe end of that, it's a very significant TAM and ability to influence patients.

Great. Thank you.

Operator

Jennifer Kim, Cantor Fitzgerald.

Jennifer M. Kim

Hi, thanks for taking my question. Maybe just start with brensocatib. I know you said that exacerbation rates are occurring in line with expectations. I think you've suggested before that it's reasonable to expect that rate to tick up as we move further away from COVID. So I'm just wondering, can you remind us what else is embedded in your expectations for these patients given the timing of enrollment and follow-up? And is there more recent literature that sort of covers the natural history of exacerbation in the 2022 and 2023 timing? Thanks.

Will Lewis

Sure. So just to remind everybody, I think it was a little over a year ago that we gave the only guidance we had on the blended blended rate of exacerbations going on in the study. And that was 1.12 to 1.15. And what we're trying to do there is give you a snapshot with of a bulk of the study having been engaged in many patients having completed as to what that rate looks like. And what was exciting to us at that time, is it that paralleled what we saw in the WILLOW study, which as you all know, was very successful. So it looked as though the behavior of this population was very similar to the Willow population. We also released the baseline characteristics, which were almost identical between the two studies.
So once again, when we think about the strategy behind the study design, it was to replicate what we saw in Phase two at nothing new change as little as possible will. So that all we're really doing is scaling up. What we knew was a successful Phase II study as we reflect on influences on rates of exacerbations, seasonality, things like COVID, et cetera. I would just share that when we did the small study using brand. So in CF patients, we didn't see any influence there as a result of COVID or other seasonal impacts. We didn't see any impact on the ARISE study.
It's a different population, but it similarly a respiratory condition and so forth of what a large study can collect and how these things are not likely are expected to be an influence on the vast majority of the patients we have recruited and have been in this study. They were recruited at that time after the restrictions have been lifted for COVID. And those that were recruited during the time of COVID restriction had to have two or more documented exacerbations to get into the study. So what does that mean means that the key to this study being successful is having enough events in evidence so that our drug can show its impact. And indeed, the blended blended rate, our examination at these sites, country and regional level, all of these things are consistent with our expectations that we're seeing enough events and that we should be able to witness the impact of the drugs treatment.

Jennifer M. Kim

Okay. And maybe one question on ARIKAYCE, the ATS conference presentation in May, I think before you said that the efficacy is pretty consistent across the individual symptoms. And so is there anything new in the detailed data that you would highlight to?

Will Lewis

Well, I would without sort of jumping the gun here, I would just encourage you to take a close look at ATS. I think we're going to have a number of different data sets that are out there that are trying to do a more refined look, if you will, at what came out of ARISE. And indeed, some other earlier stage work that we're doing to tried to illustrate the ways in which you can lean in even more heavily on the results of a rise, the results of Willow and the promise of TPIP. What's great about ATS is that all three of those, um, potential compounds are actual compounds can be featured in discussed among a peer set.
And I know from last year when we had that experience at ERS. and other conferences, it's really quite something to be there and be the subject of discussion among each of those different key opinion leader communities, all of whom are saying to us your drugs represent first or best in class treatments for these populations.

Jennifer M. Kim

Okay. That's helpful. Thanks again.

Operator

Tiago Fauth, Wells Fargo

Tiago Fauth

Hey, thanks for your question. Just two quick ones for me. So on the TPIP., I just want to recap what are we actually going to get in Q2? I know it's mostly a safety focus for the PHILD. station readout, but I'm wondering where we're going to get more detail. Pk/pd data may be efficacy? And what else could we see? It feels like a lot of investors seem a bit more as a show-me story.
And then just on the frontline, Eric case ARIKAYCE cost. But again, assuming they can replicate data similar to a rise, how that plays out commercially? Thank you.

Will Lewis

Yes, sure. So on the TPIP. front, I mean, I think everything we've seen there on a blended blended days basis suggested this is the best in class therapy. I share the observation that there are many who are not I don't have the right phrase is giving us credit for that asset. I think that's a miss very bluntly. I think if you look at the profile that that drug represents just looking at the responders in the PH study that we provided so far suggests a pretty profound impacts that are best in class in this disease state. So it's a small number of patients. It's early. We need to see more data. But if it can continues to point in that direction. And we've tried to be very specific today north of a 30% PVR reduction when we unblind the PH study next year, we would consider to be best in class. We remember sotatercept, which was acquired after Phase two and showing 33.4% reduction at its highest dose in PVR. And you know, among the responders in our study so far, we're seeing 47% reduction.
Even if it drifts down, that still is a very compelling profile for a drug that nobody currently is giving us a lot of credit for. And I think that one is that's the reason I refer to as the sleeper within the company, we will be provided looking at the time of the PH-ILD top line results of both the data about the PH-ILD study, which is a safety study. And I'll talk about those data in a second, but also data from 40 patients in the PH. study. To update you on what that blended blinded data looks like it does it continue to look as strong as it has been.
And as I say, even if it drifts down a little bit, I think it's going to be incredibly compelling on the PH-ILD front. It is can we get patients to the max dose? And we know that more than 80% have already gotten there so far and can they get there without experiencing the negative side effects that are so common in this class of therapy, there are a number of other sort of a smaller points. We'll get those data out as soon as we can. But I think we've enumerated in our slide deck on our website as well, if you want to go through each of the itemized points.
Your second question, which was on NTM and the ARISE data and the commercial potential there. Let me just put it this way. We know from what's going on in this marketplace and the challenges of treating NTM patients. This is an incredibly difficult disease to treat and to treat effectively. When we looked at our convert data, we saw 33% conversion rate in patients who are refractory, and that was a remarkable accomplishment in the mind of everybody in this disease state.
ARISE showed that after six months, we were able to convert 80% of the patients. So I don't know how much better the data could be than it was in ARISE in terms of ultimately accomplishing the goal of converting patients. That's who have positive sputum. So I think if anything, what you're going to see is a natural shift to want to treat these patients earlier with ARYKACE, because you have a chance to eradicate them, um, in six months up to 80% of the patients that that alone will drive and already has driven the dialogue among KOLs to the need to treat early and with their case.
Sure. Thanks.

Operator

Your next question comes from line of Andrea Tan of Goldman Sachs.

Andrea R. Tan

Good morning. Thank you for taking my questions. And well have just one question here and in the PRA. And there is this note that the Japanese regulatory agency has this desire to see 12 months of treatment exposure and durable culture conversion. Just wondering if you have a sense if the FDA will have similar requirements. And I asked this in the context of this potential plastics zoning approval on for frontline that you mentioned.

Will Lewis

Yes. So the FDA and PMDA have different requirements. This is true going back to when they first started examining the drug and its impact In Japan t he PMDA is very specific. They want to see culture conversion in the US. The FDA has been equally specific. They want to see impact on PRO. It's not that they will look at culture conversion. And indeed, our conditional approval for refractory MAC was granted because of the a profound impact we saw in culture conversion. B
ut they want for them to meet their own mandate of clinical effect as they perceive it. There needs to be an impact on the patient reported outcome. That's why this tool is so important to get rate from the FDA's perspective. When we look at the landscape of how people evaluate this drug, whether it's the European or Japanese regulatory authorities, the key opinion leaders, the market access world or indeed patients themselves, they are all centered on culture conversion. It is the FDA in isolation that really wants to focus on the PRO.
So the direct answer your question is while FDA will always be looking at the totality of the data, the thing that they are looking to have the evidence of its impact on the PRO and then about as part H approval, because we did see a consistent improvement on the PRO in the ARISE results. And so on the basis of that, we think it's reasonable to go to them and say, given that we've had this positive impact on the PRO, would you be willing to a permit us to review to file and secure earlier approval.
Also knowing that ENCORE study is already enrolled and largely spoken for for. So they don't have to worry about us not following through, which is a common concern at FDA. So I think for all those reasons, it's the legitimate ask. I think there's a strong argument to be made there. But I also want to reiterate that our guidance right now is at the full ENCORE data set will be needed for for approval. And if we get an opportunity to go earlier in the FDA's clear on that, and we will take advantage of it.

Andrea R. Tan

Great. And then just on on on your peak sales estimate care brands up to $5 billion plus. And just curious if you could walk us through the assumptions that get you to that $5 billion and how much of that is driven by bronchiectasis versus he asked about nasal polyps?

Will Lewis

Yes. So we haven't gone into greater detail in on that front. But I think the key drivers here and I would I know a lot of you who were thinking about modeling, um, want to look at each of these. So price, when we think about the price here, we've talked about specialty asthma products like for Centerra, which is about $40,000 a year. We refer to that historically as very likely a floor in price, assuming that the target product profile is consistent with what we saw and Willow, when we think about the addressable market, we're talking about a million diagnosed patients at the time of launch. These are patients that would meet the criteria that we think would be suitable for for effective treatment based on the results of the Willow and subsequently, assuming success the ASPEN trial.
So that's at a very interesting addressable population out of the gate. There's an opportunity to explore building beyond that, but we're going to start with that as a point of guidance. And then penetration rate, I think for a first in disease drug with a novel mechanism and a very low treatment burden like a once-a-day pill, it doesn't really get much better than that. And given the safety we've seen to date, which is very compelling and Willow and is at least that good in Aspen to date, it wasn't Willow. We think that the penetration rate being very healthy is is it is something you can rely on in your modeling efforts. I know some people have modeled it quite conservatively, but we think we're going to we're going to have a very effective penetration rate will get more specific about that as we move forward.
And I want to take this moment to highlight that shortly after the data we're going to put out of the top line data within a week. We intend to have a commercial day, if you will, a virtual Commercial Day where we will walk you through each of the assumption sets for each of our three late-stage programs are pillars. That would be ARIKAYCE.
ARIKAYCE is frontline and um, brensocatib in bronchiectasis and how we're thinking about it and CRS. and HS and TPIP. for both PAH and PH-ILD so that people can update their financial modelings up consistent with the data that we will have released by then, which will include new data on PHLDMPH. And obviously, the data from Aspen or I'm trying to go with all of this is I think the vast majority of the investment community right now is sort of in a holding period as they wait for the Aspen data.
But very shortly after that data comes out and presuming it's positive, there's going to need to be another re-rating of this company, in my opinion, because the financial modeling that has been undertaken to date, I would put in the very conservative category. There are some people that do not give us any credit for TPIP. in terms of revenue generation. There are folks who are modeling Aspen in bronchiectasis incredibly conservatively, in my opinion. And on the other side of successful data, I think it's going to be important to rapidly readjust that lens and see these three pillars for what their potential really represents and to put numbers behind that, we think ARIKAYCE, all Mac NCM, that's $1 billion plus product.
We think TPIP. between pH, PH-ILD is a $2 billion peak sales product. And we think Brent, so in bronchiectasis and CRS. without nasal polyps alone is north of $5 billion in peak sales. So there's a lot to model here. I love to understand and we're going to walk you through it within days of the top line Aspen results.

Andrea R. Tan

Thanks.

Operator

Joseph Patrick Schwartz , Leerink Partners LLC

Joseph Schwartz

Great. Thanks for all the updates on. So I have a couple of questions on that. In Broadcast business. The first is the lower blended blended rate of pulmonary exacerbations, and Aspen could reflect both treatment effect as well as some placebo effects, which we've seen other Frontier since trials including willow.
I was wondering what factors you think draws placebo risk sponsor the most in this setting and whether you're able to do anything to control for this. We hope that things like some better adherence to airway clearance and just reversion to the mean confirm these trials. I'm wondering if you think are these the biggest factors to consider or are there other things that could drive placebo more? And are you able to do anything to do to minimize that impact?

Will Lewis

Yes. So when we look at that particular aspect of exacerbation rates in the study, there are several important things to remember. The first is how do you define an exacerbation and how do you let patients into the trial using that definition? I want to remind everyone, our definition of an exacerbation is very strict. They're not only has to be an issue distribution declared by the patient and physician. But the physician then has to document the change in treatment, including either prescribing an antibiotic or admitting the patient to the hospital so that that that treatment response makes that a very substantive event that they are trying to address that of exacerbation or events is then adjudicated by a third party.
So there are several layers of protection to ensure that we're seeing a real events in the past in other studies where the definition hasn't been as strict, there's been a little bit of shift around the number of events and where they fall. And so we use this definition and Willow, it's why we saw clear statistical significant impact on both doses on the measure of that study. And I think it's why we have such confidence going into this one.
As we think about assumptions, the observed rates in most trials or right around 1.35 or so, we saw 1.37 Willow, we had assumed 1.2 more conservatively. And for Aspen, we kept that assumption that at 1.2. So the powering of this study is very healthy relative to observe rates where the placebo rates have been lower. In other studies, it is almost entirely driven by the fact that patients were recruited in areas that the placebo rates dropped because they are receiving better and better medical care.
There's one study in particular were up to 30% of the patients that were recruited came from Russia or Eastern Europe, where it is commonly the case that by having that patients from those areas, simply including them in a clinical trial, they get better medical care results on a drop of the actual placebo rate.
I'll remind you that Willow had about a [13%] recruitment from Eastern Europe, no patients from Russia and Aspen has less than 10% from Eastern Europe and no patients from Russia. So the probability of having those kinds of influences are aberration for that. And we feel like the study is well powered. We have seen the right level of blended blinded events that we want to. If this drug has a treatment effect as it did in Phase II, we will be able to capture it in Phase III.

Joseph Schwartz

Thanks. Will, that's very helpful. And kind of leads nicely into my next question, which was actually on the electronics, Tom prescribing behavior in particular, given I think there's some different propensity to use antibiotics in different regions around the world and even within a country as such as ours. I'm just wondering, is that could be a potentially consent confounding issue at all as you looked at Willow in that sense? And are you able to do anything to control so that kind of behavior?

Will Lewis

Yes. So once again, what we wanted to do with these studies is have enough patients and enough variety that controls for any idiosyncratic aberration that may come from small patient numbers are responses, happily and Willow. I'll give you an example. Probably the one most important antibiotics that we kept a close eye on is the use of macrolides because they have some anti-inflammatory effect associated with them.
Interestingly, in that study, we did not see a difference between those who were given that or were not given that. And so in Phase III, we kept that just as it was in those patients are going to end up being equally distributed across the different arms of the study. And we didn't see an influence from it. But if it were to be there, the larger numbers and the distribution across the study should have affect us from any aberrations that might hypothetically flow from that. I want to be clear, though, we didn't see in the distinction in Phase II, but because of exactly what you're talking about, we looked at it very carefully.
So we feel good about the design of Phase three because it has tried to compensate for all of these different influences that in some cases have been an evident trends in the prior Phase III studies that have failed.

Joseph Schwartz

Great. Very helpful. Thank you.

Operator

Ritu Baral, TD. Cohen.

Ritu Baral

Good evening and thanks for taking the questions. I will like frequent and questions on the Aspen statistical analysis plan. And then my second question was just some clarification on arise versus on ENCORE. For stats. It sounds like you guys now are splitting the alpha between the 10 milligram and the 25 milligram dose versus any sort of hierarchical analysis. Is that correct? And then you could you describe further on that the type of analysis that you're going to be using and how it plays into what you said about?
I think you had previously said that this study was powered down to the low and to show an effect size as low 20s reduction. I'm just wondering if that when you said that, that that was alluding to a p value of 0.1 or that 0.01 to 0.05 range that you mentioned today.

Will Lewis

Yes. So the whole thing to understand is, I know you know them better than most in the Aircana of statistics is how do you control for multiplicity and what we've done in our statistical analysis plan, at least as we can. Steve have it right now, and we'll finalize the details with FDA as we approach the final the dataset reveal is to use what's called the truncated Hochberg analysis where you basically preserve some alpha to look at each of the different dosages independent of one another.
So if 10 wins than we can go to 25 and we can look at secondary endpoints in both if 10 fails, we can still look at 25 and still preserve alpha to look at secondary endpoints underneath 25, not all statistical analysis approaches permit that this is one that has been used commonly. It's a bit with precedent. So we don't anticipate it being controversial, but that's how we're thinking about the, um, control for multiplicity and the ability to look at both the primary endpoint for each of the doses and preserve some residual alpha for the secondary endpoints.
And so when we talk about being able to detect an effect into the low 20s, it can it contemplates that approach. So hopefully, that's responsive to the question.

Ritu Baral

Got it. And you are testing that 10 milligram first before that 25?

Will Lewis

Yes, I think I mean, it can be, however, you want to think about it, the tenor of the 25, they get equal amounts of support for whether or not you clear that initial hurdle and then some residual Alpha's preserved for secondary endpoints under each of those doses guidance.

Ritu Baral

Got it which is a secondary endpoints. Have you decided to reserve alpha four?

Will Lewis

Well, you reserve alpha for effectively all of them and then you go hierarchical into the secondary endpoints to see whether or not you clear them.

Ritu Baral

Got it. Okay. And then on the meeting that you will be having on our frontline ARIKAYCE, will that solely be on a ride? Or are there any questions on Encore and QLB. or statistical analysis plan, anything around Encore left to nail down at that meeting? And it sounds like you're waiting to give an in-person meeting versus the usual Zoomer questions they'd like to do of our paper.

Will Lewis

Yes. So soon to be clear, there are two groups that we are dealing with the FDA. The first is the PRO group, the specialized group at FDA that looks at the creation and some elements that are necessary for an appropriate patient reported outcome tool to be used. That's where the first dialogue has been happening. We've had written exchange with them. It's been very encouraging. We've sent them the information they want. There's always an exchange and request for additional analysis. When that stuff goes through, they then review that we then have an in-person meeting to run to ground any final remaining questions or points they have and if the conclusion of that in-person meeting, we should have their blessing that this PRO is suitable for use in on core.
At that moment, once we have that PRO sort of finalized for Encore, then we can turn around and go to the review division and say, based on the ARISE data and the fact that this arrow is suitable and Encore and therefore in ARISE, is it reasonable to pursue a Subpart H pathway for earlier approval for all Mac NTM. And so that's the Cascade that's going to unfold here. So the specific question is, are we going to be talking about Encore arise with the PRO division? We're really going to be talking about the PRO and whether it is where it needs to be from their point of view, once that's constructed, then we we'll use that PRO as they have blasted to frame out the final elements of the statistical analysis plan for Encore.
And then in parallel, we would go to FDA's review division and ask about whether arises. To be clear. Things that are discussed with the PRO group are more like what is the minimally important difference in treatment effect that they want to see used in the PRO? We proposed a level based on what we shared with you last fall. The FDA could go above that. That could go below it for us. It doesn't matter because the drug works in all settings at all levels. That was the real breakthrough moment of the PRO last fall.
So whatever the FDA sets that we're going to be fine, it's just it really is up to them. What they feel is the appropriate threshold.

Ritu Baral

Understood. Thanks for taking the questions.

Operator

Simeon Gutman, Guggenheim Partners.

Simeon Gutman

Thanks for taking my questions. Maybe one just follow-up on brands and then one more on your case and the guidance. So on things though, obviously there's a longer trial which has been minimized and we'll have a question. We've gotten a few tens or investors just sort of the safety side of things and how long a patient at this point, any patients treated with Brendan, has anything to particularly concerned about as you look at a 12 month client as opposed to what you saw six months from when we came into the guidance and give them on a global level.
Then just curious on the Japan that will be a little bit less visibility, if you can maybe comment on sort of the trends you're seeing there. So maybe just broadly speaking, some of your growth expectations in Japan and relatively expecting in the US for 2024?

Will Lewis

Sure. So we think about the time of exposure in the ASPEN study versus the WILLOW study, I would tell you that should help us dramatically because if you think about the Kaplan Meier curve, it was separating and continued to trend apart at the different doses versus placebo. And that was within the six months timeframe. And actually, quite strikingly, remember that this drug takes about two to four weeks to get to full pharmacodynamic effect. So we really were looking at about five months of treatment effect in the WILLOW study. And to see that dramatic of an impact was was unbelievably encouraging.
So going out a year should help as we as we look for the events to take place and patients to improve, I will just share that we have had some patients in open label extension and through a special dispensation that have been on the drug. I can't think of one that's been on the drug for more than three years at this point. And the data safety monitoring board and met repeatedly. And as we've said publicly, the safety profile, we see an Aspen is at least as good as what we've seen and Willow and we're obviously blinded. But in terms of number of events and what we're seeing, it looks really good.
And the WILLOW study was striking in that we had a higher dropout rate in placebo than we did in the treatment arms. So I think the drug is looking quite safe. We have to obviously to examine the data in detail, but that is a really positive point. And it goes to the heart of why we have regulatory competence here because if we see what we saw and Willow, we know that the FDA and other regulatory authorities start with safety is the drug is safe and then they look at efficacy.
In our world w e obviously tend to do with the other way we see how it active is the drug and then is the safety tolerable for the FDA do no harm mandate really is can patients take this drug safely. And there we have a real advantage because so far that the safety profile has looked really encouraging. So I think the time element will help us in Aspen. And I think the safety is looking very good.
As we turn to the global guidance. With regard to revenue for this year? For Eric case, I would characterize both Japan and the U.S. as in a very good growth mode. I think we feel very encouraged coming out of '23, '24 as a year. We'll do very well. I would highlight the caveats that sterile mentioned in her remarks that the first quarter is always a little challenging for a variety of reasons. But the trend that we've seen year over year is that the year produces impressive growth results to be in the 6th year of a drug launch and be looking at double digit growth is really quite unique and rare and a testament to the strength of our commercial team.
And for that reason, I'm I'm very encouraged by where we are and what I think we're going to see this year from a rate case in the US and Japan in particular, but also in Europe, Europe's coming off a smaller base. It's always been a smaller revenue generating region, but I think the work that's going on there is really best in class. And I think that's important as we think about the opportunity to expand our commercial, um, capabilities to respond to the opportunity of Aspen is good to launch bronchiectasis because it will be launching in each of the three regions.
To remind everybody, our current guidance is that we would launch in the US in the middle of '25. And in the first half of 26, we would first launch in Europe and then Japan. So these are going to be rapid succession of launches and we're not that far away from it. I mean think of it this way two years from now will be will be underway in probably two of the region remains well on our way to the third.

Simeon Gutman

Okay, thanks. Thank you very much.

Operator

Your next question comes line of Jeff Hung of Morgan Stanley.

Jeff Hung

Thanks for taking my questions on for brensocatib, you know, when, but what happens if the 10 milligram doses statistically significant, but the 25 milligram doesn't? And then for the early-stage pipeline, any progress updates on minus 1201? What would you like to see in the muscle biopsy and biomarker data in the coming months? Thanks.

Will Lewis

So on the other question, stat sig and that it doesn't matter to us whether it's 10 or 25 milligrams, if either dose gets below that 0.01 threshold then and the FDA will embrace that wholeheartedly as will the treatment community. If the 10 milligram dose hits and 25 doesn't it doesn't necessarily have any negative impact. Is there evidence that one of these doses successfully treats these patients in a safe and effective way. And if we see that data at 10 milligrams, but we don't see it as that work at one dose but don't work at a higher dose and that that's perfectly acceptable.
We don't have to see a turn up into the right from 10 on the way through to the higher doses we've studied. And so I think, again, victory here, we brought 10 and 25 forward so that we would have two shots on goal, but we're very, very likely only bring one dose forward if only one of them works, that's fine. That's the one we're going to bring forward, whether it's 10 or 25 and the other does behaves differently. It does not matter and be safe and and trends right now suggest that that will be the case.

Jeff Hung

Great. Thank you,

Will Lewis

And next question on the earlier stage pipeline. And let me just say across a number of different fronts. We haven't spent a lot of time talking about that because there's this shadowing everything else that's going on both that Eric case AT & TPIP. And then, of course, cascade down to the fourth pillar of the second half of this year and the early part of next year because the progress we're making there is very encouraging. Once that happens, we will announce that and once those items have been filed will tried to frame out timing expectations for data release.

Jeff Hung

Thanks.

Operator

Liisa Bayko, Evercore ISI Institutional Equities

Liisa Bayko

Hi. And then a question about on at PHILD. and EON, if you had less than let's call it, 0.01 for now, is that our endpoints of whatever is left over as the benefits from that, let's say, 0.01 that actually work?

Will Lewis

So my understanding and again, we're getting into the Arcandor happily more capable people than me or on this. So if I get this wrong, we will circle back and Alpha as we go through this procedure as we currently contemplated. And it is our expectation that this is not in any way considered controversial from the point of view with the FDA so that our approach here and that recycling of Alpha can be utilized in the in the other endpoint measures.

Liisa Bayko

And are you allocating and are they are you favoring one over the other?

Will Lewis

We're not favoring one over the other the way the procedure goes and then to the secondaries. But if you if you clear the first like to say it's 10 milligrams. And then when that hits and then you're looking at your secondaries in a world where 10 milligrams it's But 20 set aside a priority for the examination of the secondary endpoints under 10 so that there could be a scenario there doesn't, but we could still claim a secondary endpoint benefit under the does the does hit. And that's the intention behind using this procedure.

Liisa Bayko

That's helpful and have less control for multiplicity and one of the doses doesn't have like a well up 0.05. It doesn't have any impact on the other data center?

Will Lewis

That's correct.

Liisa Bayko

Okay. Foundations of Harland, what additional data are we going to get out on? I know you're not going to give any efficacy when we might see it. And then I guess what new? Well, again in June that we carried out an application IoT.

Will Lewis

Yes. So results are some unexpected rights of, I suppose that that you're looking at some PK and exploratory efficacy data is not going to be available at the time. And um, you know, my expectation is that, um, when we look at what is it, the primary endpoint is safety and tolerability and oxygenation. And then as we go through through secondary endpoints or the PK. points of improvement in exercise capacity or six Minute Walk improvement and biomarkers of cardiac stress, so NTT vascular volume and improvement in quality of life.
Now the exploratory efficacy endpoints won't be available at the time of the top line. It just takes longer to process all of that. And because this is a study that we featured result of the study are which are a safety examination. I do think it's very important how it works and that there is a dose response curve already established, being able to show the safety and tolerability of higher dose because once you know, you can get up higher in those doses, you would expect to see that benefit flow in the different patient populations. So I think if we can show we're getting patients to max tolerated dose and the AE profile that's presented is, , is benign. Then you really achieved your goal when we the and PH patients are different periods more severe. And so you would expect that to be noisier than Ph. And you would see that in others being said that the fact that we've gotten more than 80% of the patients to achieve a max tolerated dose of 640 micrograms is already in of itself.
Remarkable now will reveal whether or not and what the mixes. And I think that will be interesting data, right.

Operator

Your next question comes from the line of Stephen Willey from Stifel.

Stephen Willey

Just one on TPIP and B to the pace of enrollment that you're seeing into the pH trial. And I guess I'm just trying to get a sense of kind of how you're thinking about the potential availability of sotatercept within the next that might impact enrollment kinetics just given I think, eligibility criteria for this background therapy. Thanks.

Will Lewis

Yes. So um, the majority of the well, the enrollment continues to go well, I would say it's picked up a little bit in the aftermath of the blended blended run trials, but work talking about a handful of patients. So I don't think the introduction of sotatercept is going to have a profound impact on the available patient population. And we are not just in the U.S. The patients are coming from abroad because there is an approved drug for the treatment of PH-ILD NPH in the US. So from that perspective of being able to to go to places like and I would expect that to continue.
Your next question comes from the line of Leon Wang from Barclays.

Leiyang Wang

Hi, thanks for taking my question. So I have two, one come on CRS. insight into the level of overlap between bronchiectasis patients and these other diseases was and was non-cash using equities. How are you thinking about BD going forward? And do you expect to continue to you livestock as a method for transacting.

Will Lewis

You saw and heard on the overlap between CRS. and HS. in bronchiectasis patients. We can look to include that this commercial day that will be in the immediate aftermath of the top line. Outdated overlap. Probably the most important point to remember and highlight is the overlap between bronchiectasis and NTT OEM because that is quite substantial and it lays the groundwork for why we're going to be able to leverage the existing commercial infrastructure on a global basis. All of the thought leadership in NTM sits.
So that provides a real opportunity for us to leverage the excellent work the commercial and medical teams have done over the past years. I'm on the BD front, yes, we did do a number of transactions that logic behind this is we believe the success of the first three, presuming that we actually will be able to pull this off and have 100% hit rate. But if these first three work as we expect them to, then they will find that we have developed internally this now represents more than 30. The different pre IND. compounds running in parallel will remain there for the time being. But that is a very robust set of opportunities. We've just reviewed them and thorough fashion missing as they enter their pre IND. final moments. And so we expect to be talking about them, particularly in detail next year, including with data. And so from that point, the way IBD, we will continue to look, we're always opportunistic, but we have some best teams of scientists we've recruited and the work that they're doing is really exceptional, incredibly promising. So I think we're going to have a very robust pipeline from which to choose. And one of the trends that you will see evolve in the next year or two is that it's quite likely we won't be able to bring all of these forward. We may be out-licensing somebody a new dimension of Insmed's business development, which relates to co-development and outlays special programs onboard.

Leiyang Wang

Great. Thank you.

Operator

Andy Chan, Wolf research.

Andy Chan

Thank you for taking the question and congrats on the progress. And just wondering so brandy, there's a there's a Th 17 component. There's a neutrophil component. I'm just wondering them versus IL-17, like why there's new fulfillment like why does interfering with neutrophil match rabies? And that is going to be better than our 17 antibodies out there. And I have a follow-up after that.

Will Lewis

Yea appreciate that question once again to be able to inform how this drug may design will include a sort of early examination of effect so that we know whether or not this is, um, we believe that it will be and it is not our intention to displace those up other approaches. I would say that we feel pretty comfortable with this space, as you may know, our merger and acquisitions. So I've been around HS. for a while. I think this is a very interesting opportunity. I think it's enormous. And I also think that the need for additional therapies to accomplish is going to continue to be the case. This will be a combination market, and this represents a very different approach than they're going to do very well. But I think some of the effect sometimes Wayne's the opportunity to come in with a once-a-day pill that could be contributory and improve these patients. And that's why we are pursuing at this is a neutrophil driven disease.
And from that point of view and a inactivating DPP. one and preventing the release of that inflammatory cascade of NSP.s, we think is going to be directly on point and potentially result in patient benefit.

Andy Chan

Right. And a follow up on your early-stage assets. So I noticed on your slide is on its IND filing. It's a singular. So it looks like it's going to be one single asset coming forward in 2024. But like what I'm just wondering if you can provide a bit more color on why isn't going to be a new technology or is it going to be validated existing technique on the market? And are you leaning towards a hot areas that everyone is going toward though it is going to be like more blank spaces on that's less competitive?

Will Lewis

Yes. So let me just frame out that we sort of think of this in four different categories, right? We have our San Diego operation. We have our New Hampshire operation, our New Jersey operation in our Cambridge, England and operation. Cambridge England is driven largely by synthetic rescue as the underlying modality. San Diego is driven by gene therapy. New Hampshire is de minimis nation of therapeutic proteins and viral capsids and New Jersey sort of sits as a connecting tissue, if you will, to these others involved in additional compounds and some of our own original research. As we look at each of those, I am expecting progress in I&D filings to come from all of them.
The timing of that has not been specified any great degree, but what I will tell you is it has multiple INDs that we expect to have certainly in 2025. The timing is going to be very close, whether it's '24, '25 in terms of single and multiple. But right now, things are looking very encouraging. And I have a lot of faith in the 10s. I think you're going to see just by way of example, in '24 and '25 IND. filings for Stargardt disease using gene therapy, ALS using gene therapy, DMD using gene therapy to name just the first three that we expect to go forward and some details around the IND. filings are more about supplementing what has already been done.
So if there's one message I can leave you with the preclinical work that provides encouragement as to therapeutic benefit is already done. We already know what we think is going to happen when we put these into humans and the effects we're talking about here are we believe, go to be profound. And from that perspective, it is a very exciting new chapter of Insmed's research and development operation. I expect the work that's coming out of Cambridge, New Hampshire and New Jersey to be equally impressive and impactful.
And I think 25 and 26 are going to be very exciting years where we're talking about a range of price facts that are in the clinic, producing data on some of the most intractable diseases that are out there. And Insmed's is going to be there at the forefront with what we believe are going to be game changing therapies.

Andy Chan

Thank you.

Operator

Graig Suvannavejh from Yes. Securities.

Hi, this is Jay offer. Greg, I just taking our questions, maybe starting to start some brands. So on the stat plan at the P value of the ASPEN trial does come out of the 0.05 mark, but the reduction in pulmonary exacerbation exacerbations does not reach the level of what you expect. How would you view the data in that context? And I have one more follow-up.

Will Lewis

Yes. So we've talked about these different scenarios is one of the reasons we tried to highlight today for people before to the fact what we consider to be the smooth this path to an approved product that will be well received by market access, the regulators, the physicians, the patients. And from through that lens, that's where we focus on that 15% threshold because if you talk to FDA and other relevant regulatory authorities and food effect, and um, we should be adequately powered at 0.05 level to achieve that. Tom, what happens if we're below 15%, but statistically significant at the 0.05 level at that level, I think going down to as low as perhaps 10%, it would still make sense to file. The safety is very good.
Remember that this is not sort of a one-and-done medicine. This is a lifetime medicine. Every exacerbation is like a heart attack for the lung. It does permanent damage. The ability to reduce that even marginally, we think is clinically meaningful. I do think as we get below that 15% threshold, we start to talk about or contemplate a different target product profile where price would change and probably come down. So those kinds of adjustments would be made. But I would be in a position where I would say hand on heart, that if I'm a patient who has exacerbations, right, not everybody has let's say it's between 10% and 15% reduction that everybody would have that reduction, right?
That would be the average. If you think about the range, there might be some patients would benefit much more dramatically on the positive side and given the safety profile, it could make sense to file in that context. I do want to acknowledge that we are hoping for 15% or greater, and we're hoping for a very clear way, less than 0.01 before between point of 1.05 and we're above 15%. We believe we have a product that's going to make a difference for between 10% and 15% were probably adjusting.
How would you think about the business opportunity side of it, but for patient benefit, given there's nothing approved, I think we would still have something that would warrant approval and appropriate use in patients that are response guided therapy, a continued progress there. And I think what we've got added to this year that we will do our best. It will be somewhere near the end of this year or the early part of next year that we'll file the IND. There's some work that still needs to be done to sort of get all the ducks in a row, if you will, with the FDA. And we certainly have taken a lot of learnings from watching other programs. And consequently, I think we're in a store strong position as we enter the clinic and we'll be able to produce data that while it isn't designed for direct comparison, people will inevitably do that. What we've set for a threshold for success here is a clear superior profile to what is already out there. That's the point I really want to emphasize. This is not an attempt to go out and do what others have done. This is an attempt to about and beat clearly what is already in the market. And that is the threshold we're setting for ourselves and we have some confidence we'll be able to beat it based on the data we've seen preclinically.
Got you. That's very helpful if that's taking our questions.

Operator

Your next question comes from line of Jason Gursky of Bank of America.

Jason Zemansky

Thank you. Good morning. Congratulations on the progress this quarter. We appreciate you joining us. And two, if I may, on Brent. So mostly follow-ups on your previous comments. But the first, to what extent is your peak potential forecast dependent on this sort of base case, 15% reduction in exacerbations levels are well above this threshold, closer to say, well, those 25 or 36%. How does that change your outlook, especially when it comes to something like penetration? I mean, what sort of upside do you think could conceivably be here?

Will Lewis

Yes. It's a great question. I think the target product profile will certainly drive the confidence that we'll have in terms of what that penetration will be, how rapid the uptake will be, what the price will be. All that sort of thing. What we use is our assumption set is something in the Willow Lake territory. So it's stats below 0.01 and a treatment effect that I would say is comfortably in the 20s. And if that is where we end up that, I think we feel comfortable with the guidance that we've given some.
Could it go higher for higher? I guess we'll have to revisit that. That's certainly a big part of the reason why we're going to have this commercial day within a week, a we're targeting of actually putting out top-line results. I would also say that, yes, what we've heard from physicians and this is perhaps a significant point to emphasize, there is a general skepticism out there that we've encountered from people who say no one's really been able to conquer the bronchiectasis market. So we're cautious and optimistic based on the success of Phase two because no one had really ever produced the data as strong as what we saw in Phase two. That's why it was published in the New England Journal of Medicine in a world where Aspen cleared that hurdle and is statistically significant at either dose below 0.01. The physicians to a person have said this drug is going to fly off the shelf. They will proactively call their patients in. They will enthusiastically embraced the use of this drug. I think you're going to see a very rapid uptake in the use of this drug, not only because it's the first ever approved medicine for this condition. But because the treatment burden of a once-a-day pill and the safety profile suggested by Willow and what we've seen in Aspen so far is very positive. That backdrop and the the sheer appetite that we've seen at the different conferences in terms of medical education and responsiveness to the potential for a drug arriving to treat this disease is very significant. We had standing room only at the last several sessions where we were doing kitchens on the medical area of bronchiectasis.
This very appropriately talking about this disease state and the challenges that patients who experienced this sort of vortex of inflammation, um, what their life is like and how impactful treatment could be if it were ever to be accomplished, I think it is referred to at the ATS. as the Holy Grail of pulmonary medicine, the last large pulmonary indication without something approved to treat it. So if we can be that first entrance, that's a very exciting opportunity for us. And what I think that the treating community and the physician the patient community is going to embrace.

Jason Zemansky

Gotcha. And then in terms of the other end points beyond reductions and PELIQ. will be an FEV one in terms of the commercial opportunity. How important are these to head on? And what's your confidence you can get there given the longer duration of therapy?

Will Lewis

Those are real unknowns in my mind, I think they're nice to haves. They're not necessary. The thing that market access position, the patients, the regulators are all very focused on is this exacerbation rate, the ability to impact that because each one of those is like a heart attack for the lung as permanent damage, and it is a major negative for for the patient. And right now, there's nothing that can be done about it. So if we can show up and say we're going to reduce that on average by about, say, 20 plus percent, that's a big deal. And of course, it will help some patients more and some less. But but to be able to have that kind of impact over time, this is a chronic medication. These patients will be on for the rest of their life would be a major breakthrough and accomplishment. And so far, it looks like we're on track to be able to produce that kind of a result. We'll know here shortly.

Jason Zemansky

Got it. Thank you so much for your color.

Operator

Your next question comes from Andreas. I mean to them from Guggenheim Securities.

Vamil Divan

Great. Thanks for taking my follow-up here. Kind of your questions this morning there during the call around the piling on $5 million filing, you came with Leerink. Can you maybe just I know you talked to some of the opposite evening, I think, today and on. So maybe you can just kind of a retailer. You said it before a little more detail on exactly the rationale for announced. We will stand in your opinion, pretty clear. But now looking at doing sort of big raising equity will be poor app into any clarification might just be helpful. Yes. No,

Will Lewis

I appreciate the question. Alex ask Sarah to address them.

Sara Bonstein

Sure, I'm happy to address it. And so I want to be clear on a couple of points the filing of the AGM this morning, if not a capital raise and we used our ATM last year and for strategic purposes, those incentives have been met and we can now plan to proactively utilizing the ATM in the near term, the ATM with a broader as a complement of the broader strategy of our multiple levers on the other side of the year. And if it housekeeping a and whatnot, I would encourage people to not overthink it. And it's something that all companies of our sites have in place. And it's something that and we put in place APM three years ago, and we haven't used it for quite some time. So people to think about it that way. I don't know if you have more on that note

Vamil Divan

That covers it. Okay. Thank you.

Operator

There are no further questions at this time. I'd like to hand the call back to Will .

Will Lewis

Terrific. Thanks, everyone, for joining us this morning and look forward to talking to you in the not-too-distant future about the updates on our various programs.

Operator

That does conclude our conference for today. Thank you for participating. You may now all disconnect