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Intercept Pharmaceuticals Inc (NASDAQ:ICPT)
Q4 2019 Earnings Call
Feb 25, 2020, 8:30 a.m. ET

Contents:

  • Prepared Remarks
  • Questions and Answers
  • Call Participants

Prepared Remarks:

Operator

Ladies and gentlemen, thank you for standing by, and welcome to the Intercept Fourth Quarter and Full Year Earnings Conference Call. [Operator Instructions] I would now like to do introduce your host for today's conference call, Ms. Lisa DeFrancesco, Head of Investor Relations. You may begin.

Lisa DeFrancesco -- Vice President of Investor Relations

Thank you. Good morning, everyone and thank you for joining us on today's call. This morning, we issued a press release announcing our fourth quarter and full year 2019 financial position and results, and also posted accompanying slides, which are available on our website at www.interceptpharma.com.

Before we begin our discussion, I'd like to note that during our call, we will be making forward-looking statements, including statements regarding our approved products in clinical development programs, certain regulatory matters, including potential approval of OCA for liver fibrosis due to NASH, and our strategy, prospects, financial guidance, and future commercial and financial performance.

Listeners are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date of the call, and we undertake no obligation to update such statements except as required by law. These forward-looking statements are based on estimates and assumptions that, although believed to be reasonable, are inherently uncertain and subject to a number of risks and uncertainties. Some but not necessarily all of the risk factors that could cause our actual results to differ materially from our historical results or those anticipated or predicted by our forward-looking statements are discussed in this morning's press release and in our periodic public filings with the SEC.

Today's call will begin with prepared remarks from our CEO, Dr. Mark Pruzanski; followed by those from our Chief Operating Officer, Jerry Durso; and our Chief Financial Officer, Sandip Kapadia. We'll then open the call to take your questions. Please limit yourself to one initial question in order to allow time for all questions to be addressed.

Let me now turn the call over to our CEO, Mark.

Mark Pruzanski -- President, Chief Executive Officer and Director

Thanks, Lisa, and good morning, everyone. Thank you for joining us on our fourth quarter and full year 2019 earnings conference call. I'm very proud of our achievements over the past year, putting us on a great footing, as we consider 2020 and the next exciting chapter for Intercept as the pioneer leading the development of a first and foundational treatment for patients with advanced liver fibrosis due to NASH.

Recapping the year, I have to begin with the first and, so far, only successful pivotal Phase 3 NASH readout. Our REGENERATE 18-month interim results confirm the robust anti-fibrotic efficacy of OCA. Still the only investigational NASH drug to have demonstrated the ability to reverse liver fibrosis in two large well-controlled trials. And given the predominant use of non-invasive tests, or NITs, in clinical practice to assess fibrosis staging, our recent scientific presentation demonstrating that a range of commonly used serum and imaging NITs correlate well with fibrosis change was highly impactful. This was capped by our reporting additional meaningful improvements in fibrosis beyond month 18 based on FibroScan imaging in our earliest recruited OCA-treated REGENERATE patients, who had been on study for up to three years at the time of the interim analysis. Of course, our Phase 3 results set the stage for the submission of our NDA now under priority review by the FDA with anticipated approval and launch within the first half of this year. This is followed by our MAA now under review by the EMA, putting us in position for a potential first half 2021 launch in Europe.

We also continued to deliver exceptional results in our PBC business with a strong finish in 2019, recording $250 million in net sales, representing 40% growth over the prior year and at the top end of our guidance. With Ocaliva now approved in 36 countries, we continue to expand access globally for PBC patients in need. And it was gratifying to report five-plus-year treatment data demonstrating durable, safety and efficacy in our completed Phase 3 open-label extension study while exceeding 10,000 patient years of experience in the PBC population.

Of course, we continue to drive innovation. And with the view of enhancing our long-term product portfolio, we initiated a Phase 2 combination study of OCA and bezafibrate in PBC while making good progress on the formulation of a fixed-dose combination. Finally, we shored up our balance sheet with a $470 million financing to solidify the Company's financial position heading into a launch year.

As we embark on 2020, we have maintained our operational momentum into the first quarter as we continue to build on our strong clinical and commercial foundation for the future. Early in the New Year, we completed enrollment of 919 patients in our groundbreaking Phase 3 REVERSE study in NASH patients with compensated cirrhosis. With an 18-month blinded treatment phase, we expect REVERSE to read out by the end of next year in this important, more advanced sub-segment of the NASH patient population.

In the meantime, all of the pieces are in place as we focus simultaneously on our regulatory review and commercial preparatory efforts in the lead up to anticipated FDA approval and launch of OCA for the treatment of patients with advanced fibrosis due to NASH. While much remains to be done, it's gratifying to consider after almost a two decade journey of discovery and development that we are finally on the cusp of bringing the first effective pharmacologic option to these patients who are truly at risk of advancing to cirrhosis, liver failure and premature death.

Before I hand the call over to Jerry, I'd like to review in a little more detail where we are in the regulatory review process. First, as you know, FDA is planning to hold an Advisory committee, or ADCOM, meeting with a tentative April 22 date, and we previously announced an updated PDUFA target action date of June 26. Planning for an ADCOM is a major undertaking and we are confident that we will be well prepared. We have the prior experience of our successful ADCOM preceding our PBC approval and our team has been doing an excellent job to prepare for the one upcoming. Engaging with a wide range of external experts, we continue to be confident that we will be able to effectively demonstrate OCA's strong value proposition for patients and positive benefit risk. As I often say, we did not taking any shortcuts in our extensive development program and have assembled a great amount of data supporting our breakthrough designated drug's safety and efficacy profile in NASH fibrosis.

With that, Jerry will now provide an update on our global commercial PBC business and NASH prelaunch activities. Jerry?

Jerome Durso -- Chief Operating Officer

Thanks, Mark, and good morning, everyone. 2019 was a solid year in terms of our PBC commercial performance. For the full year, we reported $249.6 million of Ocaliva net sales globally, which was 40% growth over the prior year as we continue to help bring the benefits of Ocaliva to more PBC patients and prescribers in the US and abroad. In quarter four, we reported $70.3 million in worldwide Ocaliva net sales, our highest quarterly sales to date. In the US, we achieved net sales of $53.5 million in the fourth quarter, reflecting consistent end-market demand growth as more community-based GI specialists gained experience with Ocaliva.

Now, turning to the international region. We achieved ex-US Ocaliva net sales of $16.8 million in the fourth quarter. This growth reflected the continued strong performance in our key international markets. This was a trend we saw throughout the entire year. And at this point, our Ocaliva net sales outside the US make up about 25% of our global net sales.

Of course, in addition to PBC, our teams continue to make progress on our preparations for the NASH launch. At our investor event in December, we spent a great deal of time talking about advanced fibrosis due to NASH as a disease, our commercial focus and our launch plans for OCA. Today, I want to update you on how we're progressing on some of our critical initiatives. We've identified our initial target population for launch as those patients with advanced fibrosis due to NASH without cirrhosis who are under the care of a specialist. This population represents a significant unmet need today and we estimated that it consists of approximately 500,000 patients in the US. Again, we believe these patients are already under the care of hepatologist and gastroenterologists, which is where we will focus our launch resources.

We continue to flex up our commercial organization in preparation for approval and for launch. We've completed the hiring of our sales force leadership, and to date, we've employed the majority of the expanded field-based team who are currently focused on disease education and customer profiling work, and we're on track with the launch plans that we previously laid out. The specialists we'll be targeting at launch often identify and manage NASH patients and practice non-invasively. Based on our market research, a strong majority of hepatologist and gastroenterologist surveyed said that they're able to reliably assess advanced fibrosis using non-invasive measures without conducting a liver biopsy.

We're making good progress through our disease education efforts as we continue to encourage physicians to use the non-invasive tools that they have access to. In addition to our work, it's also good to see momentum in the area from the efforts of other stakeholders. One recent example of this momentum came earlier this quarter when LabCorp, one of the country's leading diagnostic companies, established new CPT codes that trigger the automatic calculation of a patient's FIB-4 score along with their normal liver panel and CBC. We know that disease education is critical in a new category like NASH and we continue to focus our efforts in this area. We've had productive face to face engagement with HCPs, our recent congresses and disease education meetings.

Our field medical team was expanded last year and has been in the field now for about six months focused solely on physician education, particularly with gastroenterologists who have been very interested in learning more about NASH. When taking into account the educational efforts of our field force teams, we estimate that we already reached over 8,500 specialists. During these interactions, our education focuses on the increased risk for cirrhosis that advanced fibrosis patient space, and the importance of appropriately identifying and managing these patients.

We've been in discussions with payers as we prepare for the launch in NASH. And as you would expect, as we move closer to launch, our interactions with payers are increasing. Our market access team is making strong progress in speaking with key payers across the country. And I can say that, the level of engagement on both sides is high. Our goal remains to bring the payers on the journey and to ensure that they have a clear understanding of our target patient population of advanced fibrosis due to NASH and that there are no surprises. This work will continue to be a key focus in the months ahead and we remain very encouraged. As a reminder, our launch in NASH will be a specialty launch. We're in the first six to nine months. We expect to see the typical building of reimbursement access on the commercial side. This is then expected to be followed by the government reimbursement, which usually takes a bit longer.

So across the board, I'm very pleased with our efforts. Our in-depth knowledge in this market tells us that upon launch, OCA should be well positioned to be the first and only treatment of choice for patients with advanced fibrosis due to NASH. Our preparation is on track to execute the first launch in this category and provide access to OCA for patients suffering from advanced fibrosis due to NASH.

And now, I'll turn the call over to our Chief Financial Officer, Sandip Kapadia for a financial update. Sandip?

Sandip Kapadia -- Chief Financial Officer and Treasurer

Thank you, Jerry, and good morning, everyone. Please refer to our press release issued earlier this morning for a full summary of our financial results for the quarter and full year ended December 31, 2019. Our business performed very well in 2019. We closed the year with Ocaliva net sales at the high end of our guidance range. We invested incremental resources in our NASH launch preparation activity, while also strengthening the balance sheet with $470 million in gross proceeds from a successful financing. In the fourth quarter, we recognized $71.5 million in total revenue, our highest quarter-to-date, up from $53.3 million in the fourth quarter of 2018.

For the full year 2019, total revenues were $252 million, representing a growth of 40% over the prior year. Our fourth quarter Ocaliva net sales comprised of US net sales of $53.5 million and ex-US net sales of $16.8 million. This represents a growth of approximately 30% and 43%, respectively, versus the prior year quarter. We continue to see solid Ocaliva prescription demand growth, which we expect to continue as we move into 2020. Total gross-to-net for the fourth quarter were toward the lower end of our previously communicated 10% to 15% range.

Our GAAP operating expenses for the fourth quarter were $160.8 million and our non-GAAP adjusted operating expenses were $145.4 million. For the full year 2019, GAAP operating expenses were $564.4 million and our non-GAAP adjusted operating expenses were $499.4 million. As a reminder, our non-GAAP adjusted operating expenses excludes stock-based compensation, depreciation and non-cash operating lease costs. Our costs of sales for the quarter were $2.5 million compared to $1 million in the prior year quarter.

Our selling, general and administrative expenses for the fourth quarter were $93.7 million. This was an increase of $22.7 million over the prior year quarter and was driven primarily by increases related to our NASH launch preparation activity. During Q4, we completed the majority of the build up to support the NASH launch with the exception of the field force, which we anticipate to complete in Q1. Our research and development expenses for the fourth quarter was $64.6 million and generally in line with prior year quarter. As of December 31, 2019, we had cash, cash equivalents, restricted cash and investable debt securities available for sale of approximately $657.4 million.

Turning to our financial guidance for the year. As you saw in our earnings release this morning, as a result of uncertainties relating to our launch of OCA in liver fibrosis due to NASH and their potential impact on our 2020 financial performance, we're not providing 2020 net sales guidance. We expect Ocaliva sales in the first half of 2020 to continue to perform well, and reflect solid demand growth and continued year-over-year growth. In terms of seasonality, I'd like to remind you that we do expect softness in the first quarter of 2020 in the US as insurance plans reset. We are again expecting the typical increase in Q1 gross-to-net, which is impacted by manufacturers' responsibility for the coverage gap.

With respect to expenses, we expect non-GAAP adjusted operating expenses for 2020 to be in the range of $560 million to $600 million, reflecting our investments to support the launch of OCA for liver fibrosis due to NASH, our commercial efforts in PBC, and continuation of our clinical development and pipeline programs and other operating expenses. This expense guidance assumes OCA approval on or about the PDUFA action date of June 26, 2020.

In summary, we ended 2019 well positioned to achieve our strategic objectives in 2020. We plan to capitalize on the momentum in our PBC business that we saw in 2019 while focusing on regulatory and commercial milestones to bring the first approved therapy to patients with liver fibrosis due to NASH.

Finally, as a reminder, non-GAAP adjusted operating expense is a non-GAAP financial measure under SEC regulation. Please refer to our press release issued earlier this morning for a full explanation and reconciliation of this measure.

I'd like to now turn the call over to the operator. Operator?

Questions and Answers:

Operator

[Operator Instructions] Our first question comes from Brian Abrahams with RBC Capital Markets.

Brian Abrahams -- RBC Capital Markets -- Analyst

Hey, guys. Thanks very much for taking my question and congratulations on all the progress. It sounds like you are having increasing interactions with commercial payers. I was wondering, if you could maybe drill down on that a little bit more? Curious to learn your latest views on how you expect reimbursement to be structured. Any feedback that you're receiving on overall access, any pressure points on pricing, the potential to price differently in different indications and the perceptions right now among payers for non-invasive diagnostics? Thanks.

Mark Pruzanski -- President, Chief Executive Officer and Director

Thanks, Brian. I'll ask Jerry to take that.

Jerome Durso -- Chief Operating Officer

Thanks for the question, Brian. Obviously, as I said in the prepared remarks, and as you can imagine, we're heavily focused on our interactions with the payers, as we progress closer to launch the conversations with the payers, get both more frequent and frankly we're speaking to a broad group of influencers across the payers in different departments when you think about the construction of the national payers.

I think, our progress continues to go in the right direction. I think the discussion continues to be focused on a population of advanced patients that payers acknowledge, are the ones who have the highest likelihood to progress to cirrhosis, which is the largest concern that the payers have because that's where both the complications and the costs. So, we've seen a good progressive discussion.

I think there's a better understanding on the payers as we've continued with these discussions on the target patient population. And then depending on the payer at different points in the discussion as we now progress, there are some elements, including a final label, which are, of course, part of the finalization of that discussion and ultimately, a price point we would anticipate -- we'll be able to progress on these discussions and come back at the time of approval with a list price on NASH that we would be prepared, and look forward to communicating to you, along with our overall approach at how we would expect to move forward with the rest of our portfolio in PBC.

Brian Abrahams -- RBC Capital Markets -- Analyst

Thanks, Jerry.

Operator

Our next question comes from Alethia Young with Cantor Fitzgerald.

Alethia Young -- Cantor Fitzgerald -- Analyst

Hey, guys. Thanks for taking my question. Congrats on all the progress. Maybe 1.5. What are the biggest questions that you anticipate heading into this panel, and how are you prepared to answer them? And can you just talk maybe how they compare and contrast kind of the expectations for this panel and what you -- versus what happened at the PBC panel, obviously, two different diseases but same drug? Thanks. Yes. Thanks, Alethia. So, as I mentioned in my prepared remarks, we're well under way in terms of preparations for this panel. I think the difference from PBC, and we do have that experience, as I mentioned, with a very successful outcome, is at least twofold. One is, this is first drug in a new category. Second, NASH is, obviously, a much bigger disease and the patients, frankly, that we're targeting with advanced fibrosis are generally sicker. They have typically multiple co-morbidities. So, we're preparing, I would say, more broadly. We are actively consulting with experts across a range of disciplines, matching the typical NASH patient. I think no surprises here what FDA typically puts to a panel like this, spans the range of what is required to inform in assessment of benefit risk of any drug, and that's what we're preparing for.

Brian Skorney -- Baird -- Analyst

Great, thanks.

Mark Pruzanski -- President, Chief Executive Officer and Director

Thanks, Alethia.

Operator

Our next question comes from Michael Yee with Jefferies.

Michael Yee -- Jefferies -- Analyst

Hey guys, thanks for the question. In some of your prepared comments, again, going back to all your discussion with payers just wanted to think about or ask you about how those conversations have been around biopsy again and your conviction level that overall you're not hearing any concerns about that, and how to think about how we would learn about these requirements as the launch gets under way from payers?

And then the follow-up to that is, I know that you're in discussion for two different pricing strategies. And I guess, you said you would communicate that once NASH is approved. Is that an FDA thing that needs to be two different NDC codes, is that a payer thing, some payers would have two different NDC codes, maybe just explain how that works, just a little bit so we can understand that. Thank you so much.

Mark Pruzanski -- President, Chief Executive Officer and Director

Thanks, Mike. I'll hand that to Jerry.

Jerome Durso -- Chief Operating Officer

Yes, thanks for the questions, Mike. I guess, I'll take the second one first. So, our goal has been to maintain optionality on our price points for potentially two different brands out there if we're able to be successful. We have filed a separate NDA, which would, if approved, give us a separate brand, a separate label, a separate NDC code, which then we would have the option of how to price vis-a-vis the PBC brand. So, there would be a regulatory factor of that decision and then, ultimately, a pricing decision based on our discussion with payers and what we felt was the best pricing strategy to take at the time, and as I said, we'll come back with that in the future once we get a label on NASH and give you an indicator to our thinking on PBC.

The discussion with the payers of biopsy and how best to identify the advanced fibrosis patients that we're going to be targeting has been, as you could imagine, and I think as you probably are aware, has been a part of the discussion with payers. Again, it's been a good collaboration. One of our objectives have -- has been to engage proactively with the payers, so that we're not surprising them that we're talking openly. And of course, different payers look at the situation based on their experience, their experience in other liver conditions where we did see non-invasives become adopted, both from the physician and from the payer side.

So, while it's a little too early to be completely definitive, we do remain confident. We are having that discussion openly. I think payers are aware of all of the emerging data and practice around non-invasives along with the concerns and the limitations of biopsy and suffice to say, we remain encouraged, but we also remain focused on the work that we're doing in the field with payers and with physicians to move the field along.

Michael Yee -- Jefferies -- Analyst

Got it. Thank you.

Jerome Durso -- Chief Operating Officer

Thanks, Michael.

Operator

Our next question comes from Salveen Richter with Goldman Sachs.

Ross Weinreb -- Goldman Sachs -- Analyst

Thanks for taking the question. This is Ross on for Salveen. With the launch coming up in the second half here, how should we be thinking about any inventory impact during the initial launch period. And then, secondly, if we think about the Phase 2 REVERSE readout, what confidence you have that you guys will be able to read this trial out successfully given the current failures we've seen across the landscape by competitors?

Mark Pruzanski -- President, Chief Executive Officer and Director

Thanks, Ross. So, I'll take the second question and then hand over to Sandip for the inventory question. So, on REVERSE, very proud of the fact that we essentially doubled the size of the study last year and then enrolled it in the same period of time we've been guiding to with over 900 patients with compensated cirrhosis enrolled in the study. And as I mentioned in my prepared remarks that puts read out by the end of next year.

We've talked to this before. We obviously have the robust anti-fibrotic benefit that we've demonstrated in patients who are not yet cirrhotic, but with bridging fibrosis the F-3 patients. These patients with compensated cirrhosis are, frankly, not that much more advanced. They're early cirrhotics. We ensured that they don't have any development of esophageal varices and therefore don't yet have clinically significant portal hypertension. And we actually believe that the results that we reported out last year and the competitor failings actually give us more confidence in the ability of OCA to demonstrate fibrosis reversal in this patient with early compensated cirrhosis. So, we're very much looking forward to reading out toward the end of next year.

And then, Sandip?

Sandip Kapadia -- Chief Financial Officer and Treasurer

On the inventory, Ross, I assume you meant the sell-in of the inventory, or are you thinking like how much product will we have on hand? Or was the question more specific? I assume, it's how do you recognize the sell-in.

Ross Weinreb -- Goldman Sachs -- Analyst

Yeah, exactly. You guys going to be -- have any inventory stocking impact?

Sandip Kapadia -- Chief Financial Officer and Treasurer

Yeah. Look, I mean, we're planning to make this a specialty launch, so it will be through specialty pharmacies. Yeah. So, there will obviously be some, but it's generally much less than typically a broader launch. So yeah, I think it will obviously depend on the timing of the launch, but there'll be some inventory that will be sold in to initially. But I would say that's probably rather minimal, given the fact that it's through specialty pharmacy and we're not doing large wholesalers.

Ross Weinreb -- Goldman Sachs -- Analyst

Got it. Thanks guys.

Operator

Our next question comes from Yasmeen Rahimi with ROTH Capital Partners.

Yasmeen Rahimi -- ROTH Capital Partners -- Analyst

Hi team, congrats on the continued progress. Two questions for you, and my apologies for asking two. The first one is, how do you plan on addressing potential request by payers to define OCA responders versus non-responders in the real world for reimbursement? And then the second one is just very simplistic. What do we think how -- what might end up on the label ITT versus per protocol? A little bit color on the market research that you guys have done in terms of how comfortable docs are with these two definitions? And thank you for taking my questions.

Mark Pruzanski -- President, Chief Executive Officer and Director

Sure, Yas. I'll hand the first question to Jerry and take the second one in turn.

Jerome Durso -- Chief Operating Officer

Yeah. Thanks for the question, Yasmeen. The payer discussions are around monitoring for patients that are on therapy. I mean, I think there is an understanding that the physicians who are seeing these patients will be doing typical liver monitoring on an ongoing basis that tends to be the first thing that they're looking at in terms of the follow-up that tends to happen, as these patients are seen a couple of times a year on average. So, looking at a combination of the normal lab values, along with non-invasive, tends to be the way that these patients are managed in the real world. And that's been part of the discussion with payers today.

Mark Pruzanski -- President, Chief Executive Officer and Director

Yeah. And then, Yas, as you know, and stay tuned for more, we presented some exciting non-invasive testing data correlating all the commonly used NITs with the fibrosis improvement that we saw. And most recently in December with the month 30 data with patients who on average has been on study on treatment for another year beyond the 18-month readout with even further improvements in FibroScan-based elastography suggesting ongoing improvement in fibrosis. So, in the real world that's what we expect people to use to monitor for response.

With respect to your first question on labeling, look, the study -- the primary efficacy analysis was in the ITT population. It was the most rigorous, gold standard approach and as much as we've got a categorical binary endpoint. So, any patient who dropped out or otherwise didn't get a repeat biopsy was considered a non-responder. So, for sure, we expect ITT data to end up in the clinical study section and would, of course, hope given the totality of data supporting that primary efficacy analysis that we'd see more than just that in support of the efficacy profile of the drug.

Yasmeen Rahimi -- ROTH Capital Partners -- Analyst

Thank you.

Operator

Our next question comes from Ritu Baral with Cowen.

Dushyanth Srinivasan -- Cowen -- Analyst

Hey guys. This Dushyanth on for Ritu Baral. Just two questions from our end. First is, just in terms of the non-invasive and discussing of physicians, how comfortable are they with not only diagnosis, but on treatment follow-up with just serum-based scores versus meeting some sort of imaging modalities such as like a FibroScan or MRE to really track response? And then secondly, I know Jerry had said the NASH launch was about 8,500 specialists. Does that include the 5,000 already through the PBC launch? And if so, any further color just on timeline for how long you would think it will take to expand that reach to 15,000? Thank you.

Mark Pruzanski -- President, Chief Executive Officer and Director

Jerry?

Jerome Durso -- Chief Operating Officer

Yeah. So, maybe I'll take the second question first. So, just a little context, a reminder. So, we're currently calling on for PBC roughly 5,000 target hepatologists and gastroenterologists. Our target group for launch in NASH will be about 15,000. This goes to the broad group of gastroenterologists community base that we've outlined where the 500,000 target patients that we've designated as the launch target reside.

The 8,500 number that I issued earlier was roughly the number of physicians that we've reached through all of our education and person education to date. That number, as you can imagine, increases every week as we go to more. So, we would anticipate we'll continue to increase that. We are in the process of deploying the additional field forces that we've talked about. And so the ultimate target group that we will be hitting by the time we launch will be that 15,000. So, think about it, progressively we're educating in a variety of different means and the 8,500 is the point in time that we've reached to date.

Mark Pruzanski -- President, Chief Executive Officer and Director

Yes.

Jerome Durso -- Chief Operating Officer

And then the second question...

Mark Pruzanski -- President, Chief Executive Officer and Director

I guess the other question he asked about was serum-based NITs.

Jerome Durso -- Chief Operating Officer

Yeah. So, there is -- look, there's some variability. You have -- and I think this has been part of our strategy. We're not picking a winner in terms of the non-invasives, but we want physicians to -- and we're trying to help physicians use the tools that they have access to, and they do feel comfortable with the tools they have access to.

There are some who are using primarily the CRM-based, some who are using multiple tools, including FibroScan, FibroSURE. ELF is in the process of being introduced. So there is some variability. And again, I think, the good message for us is that physicians are comfortable with what they have access to. They are continuing to learn more and be educated, and the availability of these tools continues to grow. So that's the momentum that we see in the market that we think we're going to be able to take advantage of.

Mark Pruzanski -- President, Chief Executive Officer and Director

Yeah. And the only thing I would add to that, as Jerry mentioned in his prepared remarks, there is a lot of innovation happening. And for example, LabCorp adopting safety dose with automatic generation of FIB-4s in any patient who is available, liver function tests and then CVC is a major step forward. They're also doing a relay to FibroSURE for any patients suspected based on the primary screen of potentially having advanced fibrosis. So, we're also making great strides with big lab companies and are confident that with time, there'll be more and more adoption of these NITs.

Dushyanth Srinivasan -- Cowen -- Analyst

Great. Thank you.

Operator

Our next question comes from Steve Seedhouse with Raymond James.

Steve Seedhouse -- Raymond James -- Analyst

Hi, thank you. Just respect to -- with respect to the NDA for NASH, I was hoping you can clarify. Have you included any data from any of your clinical studies, including even REVERSE related to titration of OCA from 10 mgs to 25 mgs or from 0.5 mgs to 10 mgs? I'm just curious if any titration data could possibly find its way into a label. Thank you.

Mark Pruzanski -- President, Chief Executive Officer and Director

I mean, the short answer is, no. I mean, REVERSE obviously remains blinded and ongoing. And we do have a titration arm there for 10 mgs to 25 mgs. As you know in REGENERATE, we didn't, we had the 10 mgs and the 25 mgs, we file based on the efficacy demonstrated with the 25 mgs. And ultimately, it will be FDA's discretion on reviewing the totality of data, whether they believe that there is a role for the 10 mgs. But, we don't have in -- on the NASH side, we don't have a titration data between 10 mgs and 25 mgs.

Steve Seedhouse -- Raymond James -- Analyst

Great. Thank you.

Operator

Our next question comes from Navin Jacob with UBS.

Sriker Nadipuram -- UBS -- Analyst

Hi everyone. Thanks for taking the questions. This for Sriker Nadipuram on for Navin. Just a quick question. Given that yesterday, a competitor reported positive data on fibrosis in NASH resolution. What are your updated thoughts on the competitive landscape? And how do you view this data in terms -- in context of what the OCA reported in NASH? Thanks.

Mark Pruzanski -- President, Chief Executive Officer and Director

Yeah. As we mentioned, you're talking about the NGM announcement yesterday on their ongoing Phase 2 study. It's -- in the context of the broader competitive landscape, it's just the first glimmer of hope in a long time. The last time was a year ago with our positive readout. We weren't surprised with the result. I've often said that this compound, the FGF19 compound, is squarely in the FXR pathway. It's the only target that is currently validated. We validated it. And the bar remains very, very high to show the all-important fibrosis benefit.

The results -- just a quick comment on the results. Again, not surprising. Very much in line with our FLINT Phase 2 results, I think, gives them a path forward in Phase 3 and whether they'll have to do a much larger and likely longer-term study. And we'll see, it's of course a daily injectable. So I think that the path forward will be a little bit more challenging there as compared to a daily oral therapy like OCA. I think that at this point, I can't comment on how yesterday's news impacts the rest of the field.

I think, over the course of this year, we expect a number more readouts, a couple Phase 3 and mostly Phase 2. But, as I can say -- the only thing I can say is that the field is littered with unfortunate failures and the bar remains very high to succeed.

Sriker Nadipuram -- UBS -- Analyst

Great. Thanks very much.

Operator

Our next question comes from Brian Skorney with Baird.

Brian Skorney -- Baird -- Analyst

Hey, good morning guys. Thanks for taking the question. I was wondering if you could talk high level about the restructuring at The Office of New Drugs at FDA and how we should think about the impact this has on the review of OCA? I think the review division is getting split within the next month, so do we know will OCA be evaluated officially under the new Division of Gastroenterology or the Division of Hepatology and Nutrition? And are there division directors named for either of those divisions yet or for the Office of Immunology and Inflammation which oversees those divisions?

Mark Pruzanski -- President, Chief Executive Officer and Director

Yeah. I think obviously it's something we're following pretty closely. There has been a broader reorg of O&D over the last year, and this is sort of the creation of a new stand-alone liver or hepatology division, it is -- it's part of that plan. I'm not aware that that's been yet formally announced, but I know that it's under way as you mentioned. What we've heard is what you've heard. I think there is a recent call with Arun Sanyal where he mentioned that a division director for the hepatology division has been named, but we haven't heard confirmation of that. We do expect that the ongoing review of our NDA and all NASH INDs is going to go to the hepatology division, and we don't expect any disruption as we -- as that goes forward.

Brian Skorney -- Baird -- Analyst

Great. And then if I could just put a second one in there. In terms of the final analysis of REGENERATE, I know you guys have not wanted to guide for a readout for -- or the timing of the readout. Will there be a point when you guys are willing to provide guidance? Should we think about this as maybe a time point where we would get like a year's notice ahead of readout?

Mark Pruzanski -- President, Chief Executive Officer and Director

Well, at the present moment, as you just mentioned, we're not in a position to provide such guidance. I think that as we see on a blinded basis, events comprising the composite outcomes endpoint accumulate, and they are tracking well against our original assumptions that we might be in better position on a first-marketing basis to provide some clarity there. Needless to say, I just answered a question about the competitive landscape. It's always important to remember because people tend to look back at those following, but we continue to move forward.

And at the time, any competing compound has a chance of getting -- or in terms of the compounds in earlier phase development have a chance of getting to market will have read out REVERSE study in compensated cirrhosis, critically important segment of the population, and of course the REGENERATE outcomes to support full approval. So, we will continue -- we look forward to continuing to improve our competitive positioning in this market over time.

Brian Skorney -- Baird -- Analyst

Great. Thanks Mark.

Operator

Our next question comes from Jay Olson with Oppenheimer.

Jay Olson -- Oppenheimer -- Analyst

Hi. Maybe just to follow-on on that last comment, I have a longer-term strategic question since Intercept is uniquely positioned to create and define the market for NASH therapeutics and your lead time over competitors seems to continue to grow. But as you look out three or more years, how do you plan to maintain your leadership position in NASH and defend against later entrants who may try to redefine efficacy or other attributes of NASH therapeutics in a way that could threaten OCA? Thank you for taking the question.

Mark Pruzanski -- President, Chief Executive Officer and Director

Sure. Well, I'll just reprise the comment I just made, which is we'll continue just with our lead compound OCA which we expect to -- upon approval to position as the foundational therapy to treat this disease. We'll continue to generate data reading out and further confirming OCA's ability to -- ultimately to improve outcomes in these patients. And with that -- that will be a game changer, and it will be very, very difficult for follow-on compounds to do the same or at the very least, it will take a very long period of time.

I think we've also talked over the years about ultimately combination regimens that might emerge for the treatment of patients with this disease. And as everyone has seen or has followed the field, it's easy to talk about combo much more challenging to realize. We've always said that the bar is exceeding the high, just to get single assets forward -- moving forward, let alone combos. And the most recent combo readout was frankly, I think, most people would agree with -- hard to interpret, let's just say and hard to see how to go ahead there. But certainly, we're constantly on the look out for other MOAs that we can combine with OCA. And we've talked in the past about the potential, to the extent that PPAR looks promising that combining a PPAR like bezafibrate which of course we have the rights to in the U.S. with OCA could be promising, and we'll continue to monitor for other opportunities.

Jay Olson -- Oppenheimer -- Analyst

Great. Thank you.

Operator

Our next question comes from Liisa Bayko with JMP Securities.

Jonathan Wolleben -- JMP Securities -- Analyst

Hi, good morning. This is Jon on for Liisa. Just a question regarding REGENERATE. Can you comment on any potential unblinding due to statin use or increases, if there is anything in the protocol to try and maintain the blind? And then what are your current thoughts on any beneficial effects for statins in the NASH patients?

Mark Pruzanski -- President, Chief Executive Officer and Director

Yeah. So, we have actually presented data and it's -- in our primary manuscript at the Lancet, which came out before the end of last year, we actually show a breakdown at month 18, patients who remain statin-naive, patients who had a statin added or patients who were on a statin at baseline and how they looked from a lipid management standpoint. We've also said that statin use was not shown to make a difference in terms of patients realizing the primary endpoint in the study.

And that said, as we've been saying since the days that the FLINT trial read out, statins are recommended in the current AASLD and EASL guidelines for the management of dyslipidemia in this patient population, obviously an important and cost-effective means of managing LDL in these patients. So, it's something that we certainly advocate and we've shown that the combination of the two can be used safely and effectively in these patients.

Operator

Thank you. Our next question comes from Liana Moussatos with Wedbush Securities.

Liana Moussatos -- Wedbush Securities -- Analyst

Thank you for taking my question. How much of the opex guidance this year is for the NASH launch?

Sandip Kapadia -- Chief Financial Officer and Treasurer

Thanks for the question on the opex guidance. I mean, we haven't really provided a breakdown in terms of NASH launch, but what I can tell you is a good portion of it, certainly the SG&A, is allocated to support the NASH launch. Last year, we incrementally increased about $100 million to support the launch efforts last year, and this year we continued to obviously leverage our PBC infrastructure that we had and reallocate resources from PBC to support the NASH launch. But suffice to say, I mean the guidance overall anticipates an approval on or about our PDUFA action date.

Liana Moussatos -- Wedbush Securities -- Analyst

Thank you.

Operator

Our next question comes from Alan Carr with Needham & Company.

Alan Carr -- Needham & Company -- Analyst

Hi, thanks for taking my questions. Jerry, can you comment more on PBC sales in Europe, some of the details around that? How it's going and whether or not it's meeting your expectations? And then, Mark, can you give us your thoughts on where you think NASH trial endpoints might be headed, non-invasive versus biopsy? Thanks.

Jerome Durso -- Chief Operating Officer

Thanks Alan. This is Jerry. Yeah, I would say consistent with the overall picture, we're very positive on the progress we've made across our international markets. I think one of the really good elements that you've seen as things have progressed is the consistent performance across the main countries, it's not as if we see one or two markets that are doing substantially better than the others. I think it's been really good performance. I think the markets have learned from the earlier markets, so you've seen a sharing of the learnings in terms of the importance of the educational efforts in PBC.

I think the increase in the overall level of second-line therapy prescribing has been one of the consistent themes. And so overall, I think we feel good about the progress in Europe, the trends throughout 2019 and the momentum that we have coming into 2020, and of course that remains an important part of our PBC business as we look forward.

Mark Pruzanski -- President, Chief Executive Officer and Director

Yeah. And Alan, with respect to your question on endpoints, it's obviously the burning question in the field, where on the one hand all stakeholders, including the regulatory authorities, recognize the real limitations of biopsy and these complex histologic endpoints. And on the other hand, at least from a regulatory standpoint, it's unlikely that we're going to see a categorical shift away from the requirement to demonstrate histologic improvement in the near future. There is an upcoming, as I'm sure you're aware, AASLD/EASL co-sponsoring NASH endpoints meeting next month, so there's ongoing interest in the field.

The liver forum is active in looking at this. So, I do think it's probably just a matter of time, but right now we've got draft guidances out there focusing on histology in this population. So, we, along with everyone else, are going to continue driving validating evidence for non-invasives as endpoints, but it's going to take time.

Alan Carr -- Needham & Company -- Analyst

Great. Thanks for taking my questions.

Operator

Our next question comes from Joel Beatty with Citi.

Joel Beatty -- Citi -- Analyst

Hi, thanks for taking the question. For the upcoming AdCom, do you anticipate that there will be considering the role of non-invasive diagnostics in the prescription and use of OCA or would that be a topic outside of the AdCom?

Mark Pruzanski -- President, Chief Executive Officer and Director

It could be something that FDA asked the panel to consider. And certainly, we've presented a lot of data in support of NIT-based identification of patients. But, it's pure speculation on my part.

Joel Beatty -- Citi -- Analyst

Got it. Thanks.

Mark Pruzanski -- President, Chief Executive Officer and Director

Thanks.

Operator

Our next question comes from Thomas Smith with SVB Leerink.

Thomas Smith -- SVB Leerink -- Analyst

Hi guys. Thanks for taking the questions. Can you just talk about the rationale for the choice of doses in the REVERSE study in cirrhotics, where you mentioned Mark, the 10 mg dose along with the titration arm, looking at the 10 mgs to 25 mgs? And then if this trial were to be positive, do you imagine filing a separate NDA for this indication or would this be a potential supplement to the NASH fibrosis NDA?

Mark Pruzanski -- President, Chief Executive Officer and Director

Yeah. So with respect to dose selection, remember, we designed the study prior to the readout of REGENERATE where we tested the 10 mgs and 25 mgs, and hence the selection of the same doses for REVERSE. And remember, again, particularly in cirrhotic patients, you expect dose for dose to see increased exposure of our drug in the liver, right? So, "more bang for your buck" at a given dose. So, we're happy with the testing of those two doses. We'll see what the result is toward the end of next year.

And the second part of your question, remind me was [Speech Overlap] separate NDA. That's right. Yeah. So you know, as you know also in NASH and this is true for all the players in the field, FDA has sort of -- considers the NASH population with cirrhosis, a separate population. REVERSE is ongoing under a separate IND, and we'll have to see what based on successful readout, what the path forward then is to get the expanded indication.

Thomas Smith -- SVB Leerink -- Analyst

Okay. Great. Thanks.

Operator

And I'm not showing any further questions at this time. I'd like turn the call back over to our host.

Mark Pruzanski -- President, Chief Executive Officer and Director

Yeah. Thanks everyone for joining our year-end call this morning. Just to close, following anticipated FDA approval, we believe OCA is very well positioned to become the foundational therapy in patients with advanced fibrosis due to NASH, which we consider to be truly a blockbuster opportunity for us. The next few weeks and months will continue to be solely about execution for everyone here at the Company. And with each day that passes, we're moving swiftly toward achieving our critically important objective, which is the ability to offer the first-approved drug to patients suffering from advanced liver fibrosis due to NASH. Thanks very much.

Operator

[Operator Closing Remarks]

Duration: 54 minutes

Call participants:

Lisa DeFrancesco -- Vice President of Investor Relations

Mark Pruzanski -- President, Chief Executive Officer and Director

Jerome Durso -- Chief Operating Officer

Sandip Kapadia -- Chief Financial Officer and Treasurer

Brian Abrahams -- RBC Capital Markets -- Analyst

Alethia Young -- Cantor Fitzgerald -- Analyst

Brian Skorney -- Baird -- Analyst

Michael Yee -- Jefferies -- Analyst

Ross Weinreb -- Goldman Sachs -- Analyst

Ross Weinreb -- Goldman Sachs -- Analyst

Yasmeen Rahimi -- ROTH Capital Partners -- Analyst

Dushyanth Srinivasan -- Cowen -- Analyst

Steve Seedhouse -- Raymond James -- Analyst

Sriker Nadipuram -- UBS -- Analyst

Jay Olson -- Oppenheimer -- Analyst

Jonathan Wolleben -- JMP Securities -- Analyst

Liana Moussatos -- Wedbush Securities -- Analyst

Alan Carr -- Needham & Company -- Analyst

Joel Beatty -- Citi -- Analyst

Thomas Smith -- SVB Leerink -- Analyst

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