Provention Bio, inc (PRVB) Q3 2021 Earnings Call Transcript

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Provention Bio, inc (PRVB)
Q3 2021 Earnings Call
Nov 5, 2021, 2:00 p.m. ET

Contents:

• Prepared Remarks
• Questions and Answers
• Call Participants

Prepared Remarks:

Operator

Good morning. My name is Sarah, and I will be your conference operator today. At this time, I would like to welcome everyone to the Provention Bio call. [Operator Instructions]

I would now like to turn the call over to Mr. Robert Doody, Vice President of Investor Relations for Provention Bio.

Robert A. Doody -- Vice President of Investor Relation

Thank you, operator, and thank you all for joining us on Provention Bio's Third Quarter 2021 Financial Results Conference Call. Joining today's call from the Provention Bio team is Ashleigh Palmer, Chief Executive Officer and Co-Founder; Francisco Leon, Chief Scientific Officer and Co-Founder; Jason Hoitt, Chief Commercial Officer; and Andrew Drechsler, Chief Financial Officer. Before we begin, let me remind you that the various remarks we will make today constitute forward-looking statements. These include statements about our future plans and expectations; clinical results; regulatory and other developments and time lines related to our product candidates, including for teplizumab; our plans to work with the FDA to address deficiencies identified in its CRL, including their PK comparability and product quality considerations as well as the planned delivery of significant catalysts over the next 24 months; the potential safety, efficacy and commercial success of teplizumab and our other product candidates; the potential COVID-19 impact on our clinical studies and business plans, financial projections, including our anticipated use of cash and our cash runway; and our business plans and prospects, including with respect to any potential BLA resubmission for teplizumab and projected timing for the same.

Actual results may differ materially from those indicated by these forward-looking statements as a result of various important factors, including those discussed in the Risk Factors section of our most recent quarterly report on Form 10-Q, which we filed with the SEC this morning and in other filings that we may make with the SEC in the future. Any forward-looking statements represent our views as of today only. While we may elect to update these forward-looking statements at some point in the future, we specifically disclaim any obligation to do so even if our views change, except as required by law. Therefore, you should not rely on these forward-looking statements as representing our views as of any date subsequent to today. There is more complete information regarding forward-looking statements, risks and uncertainties in the reports Provention files with the SEC. These documents are available on Prevention's website at www.proventionbio.com under the Investors section. We encourage you to review these documents carefully.

With that, I'll now turn the call over to Ashleigh.

Ashleigh W. Palmer -- Co-Founder, President,Chief Executive Officer and Director

Thank you, Bob, and good morning to everyone joining us on the call today. We've made considerable progress across the company over the past few months. And this morning, I will begin by providing an update on the planned regulatory pathway and next steps relating to our efforts to potentially secure approval for teplizumab for the delay of type one diabetes in at-risk individuals. I'll also provide an update on our PROTECT Phase III trial of teplizumab for newly diagnosed T1D patients. Jason will then be sharing with you some of the activities and progress our commercialization team has been making in preparation for the potential approval and launch of teplizumab. Francisco will then discuss the exciting first in-human interim data that we announced last week pertaining to our polyvalent coxsackievirus B vaccine candidate as well as provide status updates on our other pipeline candidates targeting serious autoimmune diseases. Lastly, Andy will summarize our financial results for the quarter before we open up the call for your questions. In September, we issued a press release updating you on the status of our interactions with the FDA in response to considerations noted in the complete response letter we received this past July. Specifically, we took part in a Type A FDA meeting in August to discuss those considerations related to product quality and manufacturing. As noted in the press release, we believe these have either been addressed by amendments filed prior to the issuance of the CRL, which the FDA had not yet reviewed, or items our team is currently addressing and expects to have completed by the time the BLA is potentially resubmitted. The CRL also noted findings from when recent inspection as a contract fill/finish facility.

We can confirm this inspection has been closed out by the FDA as expected. Given this progress, we believe the remaining gating factor for approvability of teplizumab is our ability to either demonstrate through PK data derived from therapeutically dosed patients that are to be commercialized drug product is comparable with material used in prior clinical trials manufactured from drug substance produced by Eli Lilly 11 years ago or to provide the FDA with sufficient data to confirm that any difference in PK area under the curve seen in a single fractional, low-dose PK study in healthy volunteers does not translate into efficacy concerns in patients. It is our intention to do both of these things. During the first quarter of this year, we initiated a PK/PD substudy within the PROTECT trial to collect samples from actual patients receiving either the Eli Lilly sourced material or the to-be commercialized product. We have since completed the collection of samples from approximately 160 patients, and currently remain blinded to the PK AUC data. At the beginning of last month, following the FDA's recommendation, we requested a formal Type A meeting and submitted briefing documents, so the FDA can formally agree on the population PK model's designed prior to the unblinding of data connected from the PROTECT substudy.

The FDA has scheduled this meeting for the second half of this month. Assuming we receive the FDA's agreement at this Type A meeting, we will then proceed to populate the PK model, analyze the results and work with the FDA to determine the regulatory path forward. In our September press release, we also provided preliminary unblinded pharmacodynamic data collected from the PROTECT substudy. Our view is that the relevant PD markers, such as lymphocyte counts, CD3 receptor occupancy and T-cell activation indicate both drug products act on targeted T cells in a consistent and remarkably similar manner. While we cannot yet plain these markers in isolation are determinative of comparability, we do believe they are robustly supportive and provide strong rationale to present to the FDA why PK AUC comparability differences for this therapeutic antibody may not be clinically relevant. Switching now to teplizumab's potential use in newly diagnosed T1D patients. Our goal for the PROTECT Phase III study was to enroll 300 patients within six weeks of their initial diagnosis. Our guidance for some time now has been the completion of target enrollment would occur in quarter 3. And I'm delighted to report that we indeed accomplished this objective at the end of August.

Out of an abundance of caution, given the challenges the COVID pandemic has presented to clinical trials across our industry, we continued enrolling patients to exceed this target by about 10% to ensure that we will have sufficient evaluable patients. I do want to acknowledge and applaud our PROTECT study team, the collaborators, the investigators and clinical trial sites. And most importantly, we want to thank the patients and their families for their efforts and participation. As per prior guidance, we remain on track to deliver top line results from the trial in mid-2023. Before I turn the call over to Jason to discuss our commercialization preparations and progress, I'd like to remind you that our planning approach to date has been carefully gated and aligned with our regulatory risks and milestone. As we gain more clarity and confidence in potentially moving forward, we will begin to increase spending on prelaunch activities. Nevertheless, despite this prudent gating, Jason and his team have been able to make great progress on a number of proprietary fronts, and we would like to update you on this now. Jason?

Jason Hoitt -- Chief Commercial Officer

Thank you, Ashleigh, and good morning, everyone. I'm excited to speak with you all today and provide you with an update with respect to the great progress we've been making within the context of the gated spend and hiring approach we've taken, as Ashleigh mentioned. Beginning with payer engagement. Our market access team has been engaging payers to educate on T1D, patient screening, and when requested, on the teplizumab clinical data for over a year now. As of the end of the third quarter, our team had engaged more than 65 individual payers, representing over 200 million lives across the commercial and Medicaid payer segments. The key areas of interest within this group consists of screening, incidence and prevalence of T1D, our planned distribution model, sites of care and patient services. Importantly, these payers have generally not expressed any concerns related to our CRL or launch timing delay and have expressed interest in further engagement in the event of a BLA resubmission with a new PDUFA date. Additionally, our team has developed new resources on autoantibody testing and general T1D education, including a recently published white paper in AJMC, a payer-focused journal.

We continue our pricing research and the feedback with respect to unmet need and teplizumab's potential ability to meet that need has been to date, incredibly positive. We believe our messages resonate quite well, and we anticipate strong coverage across our payer mix. We're making strong progress with regard to government pricing and contracting policies, and we remain on track for those to be in place quickly following an approval. Our distribution model has been established with key contracts in place, and we remain on track to be ready to distribute teplizumab as quickly as possible upon approval. Additionally, our patient services program has been designed with input from key stakeholders, including patients and caregivers as well as healthcare providers. We've selected and contracted with key partners to deliver our patient services offering designed to meet the needs of families and physicians alike and are on track for launch readiness. From a marketing perspective, we've conducted extensive market research across multiple stakeholder audiences, including pediatric endocrinologists, adult endocrinologists, pediatricians, NPs and PAs, T1D patients, along with their relatives and caregivers.

The insights gleaned from this research with more than 1,300 participants to date have informed our go-to-market strategy. As you may recall, we launched two disease awareness campaigns in late 2020. Our type one tested consumer website, which has received national recognition for its content, has seen significant traffic, and notably, the traffic has amplified significantly in the third quarter of this year. Additionally, our healthcare provider website, connected by T1D, is also exceeding our expectations, both in terms of traffic, along with the amount of time visitors are spending on the site. Lastly, we recruited, trained and deployed a small salesforce pilot team, which has been focused on introducing Provention Bio to key customers, providing disease state education and profiling key accounts across the country. Overall, I'm very happy with the progress our team has made toward launch readiness, and I'm pleased to be able to share that with you today. I'm now going to pass the call over to Francisco for an update on the PRV-101 data as well as further updates on the pipeline. Francisco?

Francisco Leon -- Co-Founder and Chief Scientific Officer

Thank you, Jason. I am very pleased to join you today to discuss the updates regarding our autoimmune disease focused pipeline. Let us first begin discussing the exciting top line results from the PROVENT study, our first in-human study of PRV-101, our polyvalent inactivated coxsackie virus B vaccine candidate, which targets all five key CVB strains associated with T1D autoimmunity. CVB is not just a common cause of acute morbidity such as myocarditis, otitis, pericarditis, meningitis and hand-foot-mouth disease. In addition, chronic infection of pancreatic and intestinal cells is strongly associated with the development of T1D and celiac disease in many patients and is believed to be a trigger which sets up the immune cascade leading to the onset of these autoimmune diseases. PROVENT is a placebo-controlled, double-blind, randomized, first in-human study of two dose levels of PRV-101 in healthy adult volunteers who were providing three administrations in 4-week intervals. The interim analysis was conducted after all trial participants completed four weeks of follow-up after the third dose has been administered.

An additional six month follow-up is being conducted, and we expect the final trial results in the first half of next year. In the interim results we provided last month, PRV-101 met the primary endpoint, demonstrating that it was well tolerated in this study with no treatment-emergent serious adverse events, no adverse events of special interest and no adverse events that led to study drug discontinuation or study withdrawal. Importantly, PRV-101 also met the secondary efficacy endpoint as it induced high titers of viral neutralizing antibodies against all of the CVB serotypes included in the vaccine and in a dose-dependent fashion. Response to the vaccine was predefined as cell conversion for baseline negative subjects or a 4 times increase in titers for baseline positive subjects. The percentage of subjects who responded to all five serotypes was 0% in placebo, 67% in the low-dose arm and 100% in the high-dose arm of PRV-101. Overall, the results we've seen so far from PRV-101 are incredibly exciting and a significant step forward for this program. We believe PRV-101 has the potential to be the first vaccine ever to prevent CVB infection and its many complications, and ultimately, contribute to decrease the global incidence of both T1D and celiac disease. The next steps right now are to complete the follow-up from this trial as we engage in potential partnering discussions to help us advance the program. Moving now to other key programs in our pipeline. First, let us begin with PRV-015. Our fully human anti-interleukin 15 monoclonal antibody, which is partnered with Amgen, and is being developed for the treatment of gluten-free diet nonresponsive celiac disease. As you know, we initiated this trial in August 2020 with a target recruitment of 220 adult celiac patients. While we managed to push forward despite COVID-19, the pandemic is now having impact in our time line. In addition to general COVID-19 related disruption, which has led to delays in many trials worldwide, we have also encountered celiac-specific factors, which are impacting our study as well as all celiac trials according to our competitive intelligence.

Some examples of these factors include shutdown of elective endoscopy procedures, lack of prioritization of chronic non-life-threatening diseases and reduced exposure to gluten related to people's reduction in travel and in dining out during the pandemic. We are working closely with our investigators and sites and implementing several strategic activities. And we believe that conditions will also continue to improve as the world begins to resume more normal operating conditions. However, at this time, we are adjusting our time line and guidance for this trial with the expectation that we will complete enrollment and have top line results in 2023. We believe PRV-015 has the potential to become the first ever drug approved for the treatment of celiac disease. Lastly, I would like to take a moment to touch on the prevailed program, developing PRV-3279, our humanized bispecific scaffold DART targeting both CD32B and CD79B, which is designed to trigger inhibition of B-cell function, including suppression of autoantibody production without depleting the B cells. As you know, we saw positive results in terms of long-lasting B-cell inhibition in the Phase Ib study, and we are now on track to initiate screening in the Phase IIa trial in systemic lupus erythematosus in the fourth quarter of this year. The PREVAIL two study is a 24-week prevention of relapse, proof-of-concept trial. We look forward to sharing more details on this exciting program once we announce the initiation of the trial. I will now turn the call back over to Ashleigh.

Ashleigh W. Palmer -- Co-Founder, President,Chief Executive Officer and Director

Thank you, Jason and Francisco, for providing us with those updates. Before we move into the financial results, as you will have noted from a separate press release issued this morning, our Chief Financial Officer, Andy Drechsler, will be retiring at the end of this year. And his role will be taken forward by Thierry Chauche, who will be joining us in December, and we look forward to introducing you all to Thierry upon his arrival. However, today, we recognize Andy. I can speak unreservedly for the Board and my colleagues at Provention in emphasizing what a profound and lasting contribution Andy has made to our mission. Andy has discussed in many interactions with you, the personal impact of T1D and ciliac disease within his own family and the associated burdens and challenges that they face. We feel fortunate to have had the opportunity to work so closely with Andy and to have benefited so considerably from the crucial role he has played in bringing Provention Bio to this promising stage. In doing so, he has always allowed us to see the world of serious autoimmune diseases through his personal lens. Andy, way beyond being a close colleague, you are a close friend and family member to us all, and we wish you every happiness and all the good fortune and good health possible in your retirement, so you can spend more time with your precious family as well as devote more time and leadership to your advocacy for T1D patients and their families. Andy?

Andrew T. Drechsler -- Chief Financial Officer

Thank you, Ashleigh. A special thanks to our Board, my colleagues on the executive team and the entire team of passionate individuals at Provention. It has been incredibly rewarding to working in an organization that is so committed to conquering diseases that affect so many people, including those in my family. I am very proud of both the pipeline we built and the team we built. I'm also looking forward to assisting Thierry in his transition as his strategic and commercial financial experience is a perfect fit for our team, and I have no doubt he will be quite successful helping to guide Provention to the next stage of growth. I also want to thank all of you in the investment community for the relationships we've developed over the past 24 years that I have worked in the biotech sector. Before I begin discussing the financials for the quarter, I would encourage you to read our 10-Q that was filed today.

The 10-Q includes our financial statements, risk factors as well as management's discussion and analysis of our financial condition. I would also like to call your attention to the earnings press release, which was issued prior to this call. Let me start with the P&L. We generated a net loss for the third quarter 2021 of $27 million or $0.43 per basic and diluted share. This compares with a net loss of $31.3 million or $0.56 per basic and diluted share in the same period of 2020. The decrease in net loss is primarily attributable to a decrease in teplizumab manufacturing costs as we incurred significant costs for production of GMP and PPQ batches of drug supply and drug product during the third quarter of 2020. We also saw a decrease in regulatory expenses, which were incurred in the prior year related to the initial teplizumab BLA submission. The decrease in research and development costs was offset by increased clinical development costs for the teplizumab Phase III PROTECT trial and the PRV-015 PROACTIVE study in ciliac disease. G&A expenses were relatively flat as an increase in corporate infrastructure costs were offset by a $1.8 million decrease in pre-commercial expenses, primarily related to a reduction in our pre-commercial activities following the CRL issued by the FDA in July. Shifting now to cash.

As of September 30, 2021, our cash position was $150.8 million. Our net cash-based operating expenses, which exclude noncash expense or stock-based compensation and depreciation, were $24.6 million for the third quarter ended September 30, 2021. We expect to use between $25 million and $29 million of cash for operations in the fourth quarter of 2021. We expect our current cash, cash equivalents and marketable securities will be sufficient to fund projected operating requirements for at least the next 12 months, and that will enable us to actively develop all four of our clinical programs. We plan to provide additional cash guidance on each quarterly call as we continue to progress toward the potential regulatory approval and commercial launch of teplizumab. With that, let me turn the call over to Ashleigh for his closing comments. Ashleigh?

Ashleigh W. Palmer -- Co-Founder, President,Chief Executive Officer and Director

Thank you, Andy. Before we open up the call for questions, I want to make a few closing remarks. As we approach the final months of 2021, I think back to the founding vision Francisco and I shared about creating a company dedicated to a new paradigm in which the devastating consequences of the advanced stages of serious autoimmune diseases can be intercepted, delayed or prevented. I want to acknowledge and thank our investors for sharing our vision and providing the financial strength to build Provention and acquire and advance our exciting therapeutic pipeline. We are now working to overcome the remaining hurdles in the way of our potential first drug approval. I would also like to acknowledge and thank our colleagues at Provention, who not only share our vision but also the courage and dedication to take on the challenges that come with pioneering new approaches, to reducing the enormous unmet need and socioeconomic burden of autoimmune disease. We also appreciate all the members of the FDA teplizumab BLA review team who remain committed to working alongside it. We recognize that you have dealt with unprecedented challenges in the face of COVID and yet provided teplizumab and Provention with the care and attention required. Lastly, we so deeply appreciate all of the patients, caregivers and family members affected by serious autoimmune diseases. It is your plight that provides us with our purpose, and that is always at the forefront of our every consideration. With that, operator, we'd like to take any questions.

Questions and Answers:

Operator

[Operator Instructions] Our first question comes from Alethia Young with Cantor. please go ahead.

Alethia Rene Young -- Cantor Fitzgerald & Co -- Analyst

Hello thanks for taking my question Congrats on a great career, Andy, and wishing you all the best. Two questions, I guess. One, obviously, on teplizumab. Can you talk a little bit more about like some of the scenarios that perhaps scenarios on the FDA conversation that's upcoming? Just kind of maybe help us understand like how you're thinking about different outcomes and events and set that up? I know you ultimately know until you have it, but you obviously must be planning and thinking about some different scenarios. And then on PRV-101, I know you have the data coming over the next six months for the final analysis. But can you talk about maybe the next steps potentially for another study for this program? thankyou.

Ashleigh W. Palmer -- Co-Founder, President,Chief Executive Officer and Director

Thanks very much, Alethia, for your question. So we're taking the FDA interactions one step at a time. As I mentioned, we have the Type A meeting in the second half of November. After that meeting, we will immediately populate the model, analyze the data and discuss the appropriate next steps with the FDA. As I also set out in my comments this morning and the press release previously, we think that in parallel with this, we have a very strong, robust, supportive data for the PD markers. And so we believe that we're assembling a very robust proposition to address these remaining CRL consideration. We're planning for success. As you heard from Jason, it's our intent if the data supports these arguments to move forward and submit the or resubmit the BLA at our earliest opportunity and maintain the momentum with respect to an anticipated launch. That's really all that, at this point, we're considering, I think, to speculate beyond that is not something that we want to do. We are very confident that the data and the arguments will support what we've said all along that the comparability is an important consideration for the FDA, but that, ultimately, it's not clinically relevant.

Alethia Rene Young -- Cantor Fitzgerald & Co -- Analyst

And about 101?

Ashleigh W. Palmer -- Co-Founder, President,Chief Executive Officer and Director

Francisco, could you explain the next steps in the PRV-101 program?

Francisco Leon -- Co-Founder and Chief Scientific Officer

Alethia. So on the heels of this incredibly exciting data, we are going to share the details with the community more broadly at a couple of forthcoming scientific conferences and then engage potential partners that will help us move the program forward. Our next steps are to conduct a pediatric study, also safety and immunogenicity as the focus of that study and advance toward proof-of-concept in children, which is the ultimate target of the vaccine.

Alethia Rene Young -- Cantor Fitzgerald & Co -- Analyst

Ok get it thanks.

Operator

Your next question comes from Gregory Renza with RBC Capital Markets. please go ahead.

Gregory James Renza -- RBC Capital Markets -- Analyst

Good morning Ashleigh and team, thankyou for taking my question also let me add my congratulations and well wishes to Andy on the next leg post Provention. It's a pleasure to work with you, Andy. And Ashleigh, just following up on the previous question. Just wondering if you could elaborate a bit on Provention's disclosure plan following the Type A meeting and how you're thinking about sharing your views from that experience as well as the outcomes as those become clearer to you? And then secondly, maybe a question for Jason, just to build on his commentary. Just wondering if you could comment a little bit on how you are maintaining that momentum with respect to the stakeholders post the positive AdComm, but as the focus has been on the manufacturing issue? And maybe related to that, with an eventual refiling, how we would think about the inclusion of the 3-year follow-up data that was shared just in-flight as you're preparing for the initial BLA submission? thankyou very much.

Ashleigh W. Palmer -- Co-Founder, President,Chief Executive Officer and Director

Thanks, Greg. So we want to leave ourselves room to interact properly with the FDA. So we anticipate that we will be making a disclosure regarding the outcome of the Type A meeting after we receive the minutes. So we can make sure that our assessment of that meeting is accurate. However, while that may indeed be prudent to do so from a disclosure perspective, we'll obviously be working immediately based on the feedback from that Type A meeting to hopefully unblind the data, run the model and begin the analysis. Jason, do you want to speak to maintaining the momentum?

Jason Hoitt -- Chief Commercial Officer

Yes, absolutely. I think we're able to continue the momentum, Greg. Frankly, because we did have a little bit of a lead time here, right? We've done a lot of work over the course of the past 1.5 years to lay that foundation. And we've got our two disease awareness campaigns out in the market. We're continuing to execute on those. We've seen a pretty sizable increase in traffic and impressions on our sites because of refined media strategy and targeting. We've got our very limited pilot team that's out there engaging with healthcare professionals in the field. And I think that's given us a lot of momentum over the last five or six months to be able to have that personal promotion of disease awareness and screening and have those direct conversations to supplement the nonpersonal tactics. So I think the level of education needed around screening and disease awareness, I think, is really important and the fact that we have both personal and nonpersonal channels that we're executing against has really allowed us to continue that momentum in the field.

Gregory James Renza -- RBC Capital Markets -- Analyst

That's great. thankyou very much. And just a comment on the 3-year data and potential inclusion for a resubmission to the FDA?

Ashleigh W. Palmer -- Co-Founder, President,Chief Executive Officer and Director

I'm sorry, could you repeat the question?

Gregory James Renza -- RBC Capital Markets -- Analyst

Yes, sure. Just as far as the teplizumab follow-up data at three years that was shared last year. Just curious if that's part of the will be part of the package to resubmit to the FDA.

Ashleigh W. Palmer -- Co-Founder, President,Chief Executive Officer and Director

Francisco, do you want to talk about that? I'm not quite sure what data Greg is referring to there.

Francisco Leon -- Co-Founder and Chief Scientific Officer

Greg, you referred to our pharmacokinetic data in the PROTECT?

Gregory James Renza -- RBC Capital Markets -- Analyst

Sorry, Francisco, referring to the ADA 2020 data that was shared, I recall last year, it was just too close to be part of the submission with the initial BLA filing.

Ashleigh W. Palmer -- Co-Founder, President,Chief Executive Officer and Director

You see the TN-10 study, right. So Francisco, yes. No, that is not we'll provide an update on safety data. That was a request of the CRL. But remember, this CRL has no issues with respect to safety or efficacy at all. And so we will put forward the best arguments we possibly can with the best data for the strongest labeling, but our goal is to address this remaining PK comparability consideration and resubmit as soon as possible.

Gregory James Renza -- RBC Capital Markets -- Analyst

Thankyou.

Operator

Our next question comes from Thomas Smith with SVB Leerink. please go ahead.

Thomas Jonathan Smith -- SVB Leerink LLC -- Analyst

Hey Guys good morning thanks for taking the question Let me add my congrats and best wishes to Andy on his next chapter. I guess just to follow up on one of the earlier questions. Thinking about the timing and cadence for updates from the regulatory interactions and the PK/PD analysis, it sounds like you're planning to provide an update once you have the FDA meeting minutes, which would presumably be in the second half of December. Is it reasonable to think that we could see, I guess, top line data results from the PK/PD substudy, either concurrent with that update or perhaps shortly thereafter? Or how should we be thinking about the timing to actually seeing results from the PK substudy?

Ashleigh W. Palmer -- Co-Founder, President,Chief Executive Officer and Director

That's not an unreasonable assumption. But again, we want to make sure that we present the most accurate and up-to-date picture based on FDA interactions. And so we can't speculate yet what the Type A meeting will result in. We hope that it will be a straightforward approval of the model and be able to initiate the analysis, and we'll then report the top line results as soon as possible from that. But again, we're going to take it one step at a time. We believe that the methodology of the FDA here is to make sure that we do everything in a very complete and robust manner because this is from our perspective, and we believe, the FDA's perspective, the remaining consideration that needs to take place and be addressed in order to resubmit the BLA and move forward with a potential approval.

Thomas Jonathan Smith -- SVB Leerink LLC -- Analyst

Okay. Got it. Got it. And then just turning to Europe. I was wondering if you could just provide an update on how the conversations with EMA are going? And how you're thinking about potential submission in Europe? And then perhaps a follow-up to that. Have your conversations to date included anything related to the PK/PD comparability? Or are they more focused on the clinical data and the at-risk population?

Ashleigh W. Palmer -- Co-Founder, President,Chief Executive Officer and Director

Yes. So in the 10-Q today, we disclosed that we've had initial discussions and are advancing the ILAP process with the U.K. I think we've indicated in the past that we've we think the best path forward outside of the United States, post-Brexit is to file in the U.K. first and maintain the momentum from an agency that tends to be more aligned with FDA assessment. We're targeting the filing of the U.K. MAA in the second half of next year, and that assumes that we will be able to address the comparability consideration to the FDA's satisfaction because to your point, until we can address that, it's likely to be a consideration for all regulatory authorities. And then we're planning further engagement with the EMA throughout next year, assuming that the PK comparability issue can be properly addressed.

Thomas Jonathan Smith -- SVB Leerink LLC -- Analyst

Got it. Okay. That makes sense. And again, best wishes to Andy on the next chapter.

Operator

Our next question comes from Ram Selvaraju with H.C. Wainwright. please go ahead.

Raghuram Selvaraju -- H.C. Wainwright & Co, LLC -- Analyst

Thanks for taking my question Ashleigh, just a very quick one with respect to the interactions with the FDA. Just wanted to clarify whether coming out of the upcoming FDA meeting, you anticipate that all other items that were raised in the original CRL that don't pertain to the comparability data are likely to either be conclusively addressed or have a definitive pathway to being addressed?

Ashleigh W. Palmer -- Co-Founder, President,Chief Executive Officer and Director

Yes. So thank you for the question, Ram. We had a Type A meeting to address the product quality and CMC and manufacturing issues and review with the agency, the status of those approvability issues with them and our plans to address any outstanding issues that we have not already addressed by submissions that they had not reviewed. And that Type A meeting allowed us to make the statement back in August that we believe, to your point, they have been addressed or are addressable prior to the BLA resubmission. And therefore, they're not on the critical path to submitting, it is the CRL, it is the PK comparability consideration that is the is really the remaining obstacle to overcome to a BLA resubmission. The CRL also requested a safety data update. And that's not because there were any concerns over safety. It's because the agency, obviously, prudently wants to make sure that it has all the safety data available to it in the period from when we last filed the BLA to this point, there's obviously been studies, the PROTECT study and so on, where patients have continued to receive the teplizumab and they want an update on that. And we see that as a routine request, which we are confident we will be able to comply with.

Raghuram Selvaraju -- H.C. Wainwright & Co, LLC -- Analyst

Okay. Perfect. And then just following on from what you were discussing earlier regarding the way in which regulators, other than the FDA, are likely to look at the PK comparability data. Have you actually had substantive discussions with any other regulator beyond the FDA regarding the specific topics of concern that the FDA originally raised? And if so, what's your read on how similarly the other regulators and other countries are likely to treat this issue relative to the way the FDA has treated it.

Ashleigh W. Palmer -- Co-Founder, President,Chief Executive Officer and Director

Yes. Thank you for the follow-up. So the comparability consideration is a review issue as a result of submitting a the market application. We've not submitted a market application anywhere else other than in the United States. And so the substantive conversations that we've had with the U.K. and with the EMA have been scientific advice conversations, looking at the totality of the data, the specific clinical trials, the unmet need and receiving advice on how to put forward a marketing authorization application. And so therefore, we have not had substantive discussions with the agencies outside of the United States on the comparability consideration. Nevertheless, the likelihood that those agencies will be satisfied if there is no PK consideration from the FDA's point of view, having seen the PK in actual patients receiving therapeutic doses over a 12- or 14-day period, I think, is very it's very likely that they will see it the same way.

Raghuram Selvaraju -- H.C. Wainwright & Co, LLC -- Analyst

Okay. That's helpful. Just a few financial questions. Also wanted to extend my best wishes to Andy on his upcoming retirement. The questions are as follows. Firstly, looking at the expenses that you reported today for the third quarter, especially on the G&A line, those seem to have declined substantially relative to the amounts that were reported in the first and second quarters. And I was just wondering whether the G&A quarterly amount, the quarterly spend that was reported in the third quarter is likely to be a more dependable baseline for us to consider for upcoming quarters? And then the next two questions are accounting related. With respect to the revenue reported in the third quarter, can you just kind of break down for us precisely what that was and what you expect to be reporting on a go-forward basis, purely driven by kind of amortization-based considerations? And then with respect to the MacroGenics milestone that would be due, as I understand it, on the approval of teplizumab, can you just give us a sense of how you will be treating that from an accounting perspective? And how that's likely to show up on the P&L? thanks.

Ashleigh W. Palmer -- Co-Founder, President,Chief Executive Officer and Director

Andy?

Andrew T. Drechsler -- Chief Financial Officer

Yes. Thank you, Ram. I appreciate the questions and the well wishes. So Q3 expenses, what you saw was, yes, a reduction in G&A. And quite frankly, just a pullback on the pre-commercial spend, right, that we were starting to ramp up in the first half of the year once we received the CRL, we obviously rein that in. But I think it's it would be reasonable to expect that same rough level in Q4, and that's the only guidance we've put forward, right, is the $25 million to $29 million of operating burn in the fourth quarter. From a revenue perspective, Ram, what you saw in this quarter was the beginning, right, of the amortization of those monies that were provided by Huadong, right? The upfront money, the milestone money, we will recognize that as the activities around that Phase II study for lupus are conducted, right? So over the next couple of years, we'll end up recognizing that full amount of revenue. Happy to take offline the conversation on any detailed calculations of that. And then, finally, on the MacroGenics, there is a milestone payment upon approval. And that would be recognized or be paid soon after the approval occurs. I think it's paid within about 90 days.

Raghuram Selvaraju -- H.C. Wainwright & Co, LLC -- Analyst

Thankyou.

Operator

Your next question comes from David Hoang with SMBC. please go ahead

David Timothy Hoang -- SMBC Nikko Securities America, Inc -- Analyst

Hey thankyou for taking up my question. So the first one, I think, is probably one for Jason. I'm just wondering if you could share a little bit more color, more granularity on the discussions that you've had with the payers. It sounds like those have been going really well. But I'm just wondering if things like what type of prior authorization, any restrictions? How they managed the product if that has come up?

Ashleigh W. Palmer -- Co-Founder, President,Chief Executive Officer and Director

Jason?

Jason Hoitt -- Chief Commercial Officer

Yes. Thanks, David. So I agree with your sentiment. I think I'm encouraged by both the feedback, the quality of the feedback and the consistency of the feedback that we've been receiving from payers, frankly, for the past 1.5 years. I would say that our expectation and our goal strategically is to have a streamlined prior authorization to label. I think what we've heard from payers is that, that's how they would anticipate covering this, that it would likely be covered as a medical benefit under most plans and that they would anticipate covering to label, assuming that they don't see the price as something egregious. And we haven't set the price yet. So I would anticipate broad coverage and the anticipated goal that we have is a streamlined PA to label.

David Timothy Hoang -- SMBC Nikko Securities America, Inc -- Analyst

Got it. That's really helpful. And then just had a couple of questions on PRV-101, the vaccine candidate. So if I'm reading this correctly, it sounds like or for the next stage, that is a kind of Phase II efficacy study, you would be wanting to have a partner to really advance the products forward. So I just want to make sure my read is correct there. And then similarly, you've also mentioned the potential use case for not only T1D but also celiac disease. So I'm wondering if there are any plans at this time to develop it for celiac?

Ashleigh W. Palmer -- Co-Founder, President,Chief Executive Officer and Director

Yes. So yes, I think you're reading it correctly. We think we've created enormous value in this asset by conducting this first-in-human study and showing the immunogenicity that the polyvalent vaccine is able to generate. And this, we believe, is a very good mechanistic proof-of-concept that will allow us to have good partnering discussions because we're not a vaccine company. And we think that the advanced stages of vaccine development and the ultimate commercialization is better handled by a company that has that expertise and experience.

David Timothy Hoang -- SMBC Nikko Securities America, Inc -- Analyst

Okay. Great. And good luck to you, Andy, in your next chapter.

Andrew T. Drechsler -- Chief Financial Officer

Thank you.

Operator

This concludes our question-and-answer session. I would like to turn the conference back over to Ashleigh Palmer for any closing remarks.

Ashleigh W. Palmer -- Co-Founder, President,Chief Executive Officer and Director

Well, thank you again for your time and attention this morning. We look forward to continuing to keep you up-to-date on our progress going forward. And we'd like to wish you and all of your families a happy and healthy holiday season as we approach that time. Thank you very much.

Operator

[Operator Closing Remarks]

Duration: 54 minutes

Call participants:

Robert A. Doody -- Vice President of Investor Relation

Ashleigh W. Palmer -- Co-Founder, President,Chief Executive Officer and Director

Jason Hoitt -- Chief Commercial Officer

Francisco Leon -- Co-Founder and Chief Scientific Officer

Andrew T. Drechsler -- Chief Financial Officer

Alethia Rene Young -- Cantor Fitzgerald & Co -- Analyst

Gregory James Renza -- RBC Capital Markets -- Analyst

Thomas Jonathan Smith -- SVB Leerink LLC -- Analyst

Raghuram Selvaraju -- H.C. Wainwright & Co, LLC -- Analyst

David Timothy Hoang -- SMBC Nikko Securities America, Inc -- Analyst

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