Coherus BioSciences (CHRS) Q4 2021 Earnings Call Transcript

Coherus BioSciences (CHRS 2.31%)
Q4 2021 Earnings Call
Feb 17, 2022, 5:00 p.m. ET

Contents:

• Prepared Remarks
• Questions and Answers
• Call Participants

Prepared Remarks:

Operator

Good day and thank you for standing by. Welcome to the fourth quarter and full year 2021 Coherus BioSciences earnings conference call. [Operator instructions] Please be advised that today's conference may be recorded. [Operator instructions] I would now like to hand the conference over to your host today McDavid Stilwell, chief financial officer.

Please go ahead, sir. 

McDavid Stilwell -- Chief Financial Officer

Thank you, operator. Good afternoon everyone and thank you for joining us. We issued our press release earlier announcing our 2021 fourth quarter and full year results. This release can be found on the Coherus BioSciences' website.

Today's call include forward-looking statements regarding Coherus' current expectations about future events. These statements include, but are not limited to, our ability to advance our product candidates through development and registration, the status of our product candidate clinical profile, our timing and ability to commercialize our products and product candidates in the future. Our R&D and SG&A expense guidance for 2022 and our ability to meet the same. Our projections about margin, as well as our ability to draw down amounts under our new credit facility, all of which involve substantial risks and uncertainties that are beyond our control and could cause actual results, performance, or achievements to differ from the results, performance, or achievements complied by the forward-looking statements.

These statements are not guarantees of future performance and are subject to certain risks and uncertainties that are discussed in our press release that we issued today, as well as in the documents that we file with the Securities and Exchange Commission, including those in our annual report on Form 10-K and quarterly reports on Form 10-Q. The forward-looking statements provided on the call today are made as of this date, and we undertake no duty to update or revise any forward-looking statements. With me on today's call are Denny Lanfear, CEO of Coherus; Paul Reider, chief commercial officer; and Theresa LaVallee, chief development officer. And I will now turn the call to Denny. 

Denny Lanfear -- Chief Executive Officer

Thank you, McDavid, and thank you all for joining us this afternoon. Today, I'll describe how over the past year, we've delivered on our objective to transform Coherus into an innovative immuno-oncology company supported by income from a diversified portfolio of FDA-approved products. I'll begin today with a brief review of our achievements toward our strategic initiative in immuno-oncology, detailing the progress of our foundational assets toripalimab and of our preclinical and clinical-stage innovative combination agents. Then I'll review recent progress to grow and diversify our commercial portfolio.

Now with respect to our immuno-oncology programs, you may recall that in November, we announced the FDA granted priority review for the BLA for toripalimab for the treatment of nasopharyngeal carcinoma. An indication with no FDA-approved cancer immunotherapy options and for which toripalimab has breakthrough therapy and orphan drug designation. The BLA review is progressing well toward the target action date of April 30, which is about 10 weeks from now. Toripalimab clinical profile continues to strengthen across indications.

In December, we announced that toripalimab plus chemotherapy demonstrated a statistically significant overall survival benefit and a prespecified interim analysis on the CHOICE-1 clinical trial for the first-line treatment of advanced non-small cell lung cancer. This built on other first-line indications in esophageal squamous cell carcinoma and nasopharyngeal carcinoma, where we have seen a robust benefit both the progression-free survival and overall survival. We've also made progress with our clinical-stage -- mid-stage I-O strategy. In January, we initiated the process to exercise our option and license JS006, a TIGIT targeted antibody developed by Junshi BioSciences our partner, which they are evaluated in a study combination with toripalimab.

Dr. Theresa LaVallee, our new chief development officer, will provide additional details about JS006 and our development plans for you in just a moment. Our immuno-oncology preclinical research and development team is proving to be highly productive. In January, we announced that we are advancing an internally generated pipeline of PD-1 combination candidates and we expect to file the first IND in mid-2023.

With toripalimab nearing its first potential approval, a TIGIT target immune checkpoint blocker entering mid-stage development, and our in-house early stage immuno-oncology candidates successfully advancing toward human clinical trials, Coherus is evolving into an innovative immuno-oncology company with a broad pipeline of product candidates and the potential to drive long-term growth over this decade. I'd now like to introduce Dr. Theresa LaVallee, our recently appointed chief development officer, who brings more than 25 years of drug discovery and development experience and is recognized for her immuno-oncology expertise. Most recently, Dr.

LaVallee was Vice President of Translational Medicine and Regulatory Affairs at the Parker Institute for Cancer Immunotherapy, where she provided scientific leadership for the clinical strategy for development of novel immuno-oncology therapies and help establish the Institute's translation and regulatory organization. Part of that, from 2008 to 2013, Dr. LaVallee was a member of the immuno-oncology team, developing checkpoint inhibitors and related diagnostics at AstraZeneca. Theresa?

Theresa Lavallee -- Chief Development Officer

Thank you, Denny. It is exciting to join Coherus as the company gains momentum and its transition to an innovative immuno-oncology leader. I believe our broadening product portfolio with early, mid- and late-stage complementary I-O products is well-positioned to clinically succeed in; immuno-oncology. Commercially, our oncology-focused organization has proven that Coherus can be very successful in highly competitive fields.

Coherus has both the in-house expertise and assets needed to support a successful transformation. Antibody development for PD-1 combinations and co-formulations requires world-class analytics, protein science, and bioinformatics capabilities. We have that at our Camarillo, California site, a 25,000 square foot facility we moved in to two years ago. On the development side, our clinical and regulatory teams have repeatedly demonstrated the ability to develop drugs that gain FDA approval.

Our Scientific Advisory Board has recognized I-O experts from academia and industry is actively involved in our target and [Inaudible] selection, playing a key role, for example, in selecting toripalimab from a due diligence review of more than 10 PD-1 product candidates, as well as setting the TIGIT assets from Junshi. For Coherus, these investments are paying off. Toripalimab, our foundational immuno-oncology asset is establishing an excellent safety and efficacy profile in the ongoing clinical trials. The toripalimab BLA for nasopharyngeal carcinoma, an unmet medical need with no approved immunotherapies is under priority review by the FDA with an action date of April 30.

Denny mentioned earlier that toripalimab's clinical profile continues to strengthen across indications. Case in point, the positive progression-free survival, overall survival data from the JUPITER-6 study in esophageal squamous cell carcinoma, which showed a significant overall survival benefit even in low PD-01 patients. We have and will continue to engage the FDA on the potential for submission later this year of a supplemental BLA for toripalimab in combination with chemotherapy for its first-line treatment of ESCC. Another important immune responsive tumor type is hepatocellular carcinoma, which also is highly prevalent in patients with Asian descent, in which the FDA has said could warrant regulatory flexibility for new PD-1s.

We are conducting two pivotal clinical trials evaluating toripalimab and HCC, including a frontline trial, randomizing approximately 520 advanced HCC patients to lenvatinib and placebo versus lenvatinib plus toripalimab. In adjuvant therapy, we have a trial with approximately 400 HCC patients randomized to toripalimab or placebo following resection. Initial clinical data from these studies are expected later this year. The February 10, ODAC meeting discussing the Innovent Lilly BLA for non-small cell lung cancer provided helpful insights into the FDA's expectations for sponsors seeking approval for PD-1s for indications with available immunotherapy options.

We believe it is wise to fully engage with the FDA early and prior to submission decisions to fully understand their views. We are continuing to meet with the FDA frequently for toripalimab for multiple potential indications, and we'll discuss with them this year, the pathway for toripalimab in combination with chemotherapy for first-line treatment of non-small cell lung cancer. Although there are FDA-approved checkpoint inhibitors for non-small cell lung cancer, new and more effective treatment options are needed as the majority of patients still die rapidly from this deadly disease. We are focused on addressing unmet patient needs.

The non-small cell lung cancer will be the first tumor type we pursue for the combination of toripalimab with JS006. We are excited about the development of this TIGIT antibody. TIGIT is emerging as an important checkpoint to enhance PD-1 antitumor immunity. After a decade of translational research with I-O, the field understands better how PD-1 inhibitors work and why they have been foundational for I-O treatment.

Cancerous trick attacking T cells into setting of a subset of T cells that exhibit stemness have the potential to be reactivated by the unique crosstalk between PD-1 and TIGIT pathways. All of this is consistent with the observed improved clinical activity with PD-1 and TIGIT inhibitors in the clinic and specifically in non-small cell lung cancer. In preclinical studies, JS006 has demonstrated excellent binding affinity and strong inhibition of the TIGIT pathway, as well as enhanced antitumor activity, in combination with toripalimab in preclinical mouse models. A clinical study evaluating JS006 as monotherapy and in combination with toripalimab in patients with advanced solid tumors is ongoing.

The IND for JS006 is open in the United States, and we are planning to advance JS006 in combination with toripalimab in a clinical trial in the U.S. later this year. Clinical data news flow will continue this year as results come in from trials evaluating toripalimab for the first-line treatment of non-small cell lung cancer and two additional non-small cell lung cancer studies, one in the neoadjuvant setting, as well as a trial in patients with EGFR mutations, who have failed prior TKI therapy. And also pivotal studies in triple-negative breast cancer, hepatocellular carcinoma, and intrahepatic cholangiocarcinoma.

Depending on clinical outcomes and conversations with the FDA, these studies could lead to additional indications for toripalimab in the United States. I will now turn the call back to Denny.

Denny Lanfear -- Chief Executive Officer

Thank you, Theresa. It's great to have you on the team directly in our mid- and late-stage I-O development efforts. Now let me briefly summarize our recent accomplishments with respect to our commercial stage portfolio and our goal to grow and diversify our commercial portfolio of FDA products. As you may recall, in December, the FDA approved our second product Yusimry, a Humira biosimilar.

Paul will address our planning for this important launch in 2023 and some of the key issues we are considering to ensure that we reach our market share objectives. [Inaudible] the market continues to be very important to us and has only about 50% biosimilar penetration in terms of presentation segment mix. We have had good success with additional presentation and development to address all the segments. In October, Udenyca on-body injector demonstrated pharmacokinetic and pharmacodynamic similarity in a randomized clinical trial, enabling the submission this year of a prior approval supplement to the Udenyca BLA.

If it is approved, we project that 2023 launch of the Udenyca on-body injector, which would compete directly with Neulasta Onpro, which would provide a second layer growth for Udenyca. Udenyca in the prefilled syringe format continues to provide a significant source of funding for our pipeline investments and to support upcoming commercial launches. Net sales of Udenyca declined to $73 million in the fourth quarter. Within the context of increasingly competitive pegfilgrastim market.

We anticipate Udenyca net revenue in 2022 will decrease relative to the $327 million of net revenue generated in 2021. Our strategy is to balance price and market share to optimize long-term revenues that format in 2022 and then gaining significant share through to the accessing the [Inaudible] on-body segment in 2023. In October 2021, the FDA accepted for review the BLA for Cimerli, a Lucentis biosimilar. Mid-cycle review meeting occurred recently, and the BLA is progressing well toward the target action date in August this year.

As Paul will elaborate, we plan to launch Cimerli in the second half of this year, assuming approval. We are also planning for the launch of toripalimab in MPC major, further diversifying our product portfolio in 2022. These two launches in 2022 should be followed by the two 2023 launches of Yusimry and the Udenyca on-body injector, accelerating our revenue growth. We expect these four new products to market inflection points for revenues, fueling top-line growth starting later this year.

We expect growth to continue with the potential expansion to toripalimab label and project long -- longer-term growth with the JS006 for combination and our innovative I-O pipeline we've discussed. I'll now turn the call over to Paul Reider, our chief commercial officer; and Paul will review Udenyca's fourth quarter performance and update you on the launch preparation for toripalimab, Cimerli, and Yusimry. Paul?

Paul Reider -- Chief Commercial Officer

Thank you, Denny. As Denny indicated previously, Udenyca net sales were $73 million in the fourth quarter, down 12% from the prior quarter. This was driven by a 4% decline in demand units, as well as continued price erosion due to intense competitive pressures in the trade progress and throughput surge market. Our share declined slightly from 18% to 17.5% in the fourth quarter.

Market share gains in the clinic segment were offset by declines in both 340B and non-340B hospitals. On a unit basis, the overall pegfilgrastim market declined modestly in the fourth quarter, a period in which, historically, we've seen slight market growth. We expect a return to low single-digit market growth in 2022. Until COVID recedes more broadly, there will continue to be a short-term advantage favoring the originators on-body device, which retains approximately 50% share of the overall market.

As Denny indicated, we expect Udenyca sales to grow again once we introduce our Udenyca on-body injector next year, if approved. Our strategy is to balance price and market share of optimize long-term revenues with the PFS format in 2022 and then gain significant share through access in the untapped on-body segment in 2023. Now, I'd like to talk about commercializing our pipeline. We are preparing for the launch of three new brands in the next 18 months.

toripalimab, our PD-1 inhibitor for nasopharyngeal carcinoma; Cimerli, our Lucentis biosimilar; and Yusimry, our Humira biosimilar. Regarding toripalimab, nasopharyngeal carcinoma or NPC is a rare cancer, where there are currently no PD-1 inhibitors approved for use by the FDA. Toripalimab not only has the potential to be the first and only PD-1 inhibitor indicated for this tumor type that has the potential to also establish a new first-line standard of care. Our oncology commercial capabilities have been built to scale and the toripalimab launch effort will be efficiently integrated into our existing commercial infrastructure.

Commercial launch preparations are proceeding on track. I'd also like to note that the NCCN guidelines for nasopharyngeal carcinoma recently added the JUPITER-02 study of toripalimab for the first-line treatment of NPC as a reference which serves to validate the significance of this important clinical trial. But with respect to Cimerli, our FDA action date in August 2022 will allow us to launch into the $1.4 billion Lucentis market in the early stages of biosimilar market formation, and we look forward to competing in the retina therapeutic area. Retinal specialists opinion leaders have expressed positive receptivity to Coherus entering this market.

And our documented track record of success in oncology gives them confidence that Coherus understands the dynamics of the buy-and-bill market and that we will deliver a safe and effective alternative to Lucentis, along with a compelling value proposition. Similar to our playbook with Udenyca, we plan to launch biosimilar education campaign to the retina community in the second quarter. We've also completed our account segmentation work and intend to launch for the focused and dedicated ophthalmology sales team, while at the same time, leveraging our commercial organization's existing key account, market access in patient support capabilities. Now on to Yusimry, we're preparing for the launch in July 2023.

Humira has been the top-selling drug in the United States with net sales of $17 billion in 2021 and we look forward to competing in this market. While we expect significant competition, our commercial goals to achieve at peak at least 10% share of the overall adalimumab market. We believe payers will drive biosimilar adalimumab adoption and have completed extensive market research with national and regional payers, as well as PBMs. The insights gleaned from this research confirm that Coherus can and expects to deliver on all of the payers' critical expectations.

These include a competitive price that delivers value to key stakeholders. Robust and reliable supply with high-quality manufacturing, a non-stinging citrate-free formulation, prefilled syringe, and auto-injector presentations with high gauge needles that are comparable to the reference product and that are comfortable, reliable, and easy for patients to use. Robust patient support services to facilitate access and to address patient out-of-pocket costs. Also according to our research, interchangeability was regarded as a nice-to-have attribute but not essential since payers already have the mechanisms to drive product selection based on their formularies and utilization management tools that they use routinely today in multiple product categories.

So to meet these expectations, Coherus has previously invested in large-scale manufacturing and expects to be well-positioned to compete on supply guarantees and price. We will have quality prefilled syringe and auto-injector presentations. Our Yusimry device use 29-gauge needle comparable to the originators and we also will use our proprietary non-stinging citrate-free formulation. In addition, for Coherus COMPLETE, which is our patient and provider services are considered best-in-class among the pegfilgrastim class today.

We have an established and high-touch service offering to facilitate access and affordability. Some large competitors may position their adalimumab biosimilar within a portfolio offering to payers. Coherus, by contrast, will have a singular focus on competing successfully in the adalimumab market without the constraints of trying to minimize the collateral impacts of price erosion on a portfolio of premium priced branded products. Our interest is in seeing the overall adalimumab market become as large as possible.

We believe this is also in the best interest of payers and patients. In short, we are confident we can deliver a compelling overall value proposition and expect results consistent with our market share forecast with Yusimry. I'll now turn the call to McDavid for a review of the quarter's financial results. 

McDavid Stilwell -- Chief Financial Officer

Thank you, Paul. The details of our financial results are in the press release, so I'll focus now on a few highlights. For the fourth quarter and full year 2021, we reported net losses of $46 million and $287 million, respectively, on a GAAP basis. Cash used in operating activities was $52 million for the fourth quarter and $37 million for the full year 2021.

As detailed earlier in the call, net revenue was $73 million for the quarter and $327 million for the year. This is a decrease for both periods, reflecting lower unit volumes and lower net realized price. Wholesaler inventory remained within the normal range at year end. Cost of sales was $12 million for the quarter and $58 million for the year, resulting in gross margins of 84% and 82%, respectively.

Recall that in the first quarter of 2021 we depleted the inventory manufactured and expensed prior to approval. And since then, per unit acquisition costs are fully reflected within COGS. Accordingly, cost of goods as a percentage of net revenue has increased since 2020. In the long run, starting in 2024, a we expect Udenyca prefilled syringe gross margins to return to 90% or higher as we realize the benefits of a significant manufacturing process improvement and also royalty expiration.

Research and development expenses were $51 million for the quarter and $363 million for the year. This is an increase over 2020 and includes the $136 million upfront payments to Junshi for the toripalimab license, as well as costs to advance our late-stage pipeline, activities, such as regulatory affairs and manufacturing scale-up for Yusimry, clinical development and BLA filings for toripalimab, a clinical trial for the Udenyca on-body injector, as well as the ongoing three-way PK study evaluating CHS-305, the Avastin biosimilar. Selling, general and administrative expenses were $50 million for the quarter and $170 million for the year. an increase that was primarily driven by higher Udenyca commercialization activities, as well as stock-based compensation expense.

We ended the year with $417 million in cash and cash equivalents. Recall that subsequent to year end, we entered into a credit facility agreement with Pharmakon Advisors for a $300 million term loan payable across four tranches. We drew the first $100 million tranche at closing and simultaneously paid off a $75 million term loan. Prior to April 1, we plan to draw a second $100 million tranche and simultaneously pay off the convertible notes that come due at the end of March.

Two additional tranches of $50 million each will become available to us upon the FDA approval of toripalimab and of Cimerli. We are introducing full year 2022 guidance for R&D and SG&A expenses of $415 million to $450 million. Not including the $35 million upfront fee to Junshi Biosciences, we expect to pay later in the first quarter for rights of JS006 or the $25 million milestone payment that will become due on approval of toripalimab for NPC. This guidance range includes approximately $55 million to $60 million in non-cash stock-based compensation expense.

Let me provide some additional color on these anticipated operating expenses, much of which is investment that will convert back to cash quickly with a high IRR. This year, we will spend approximately $50 million manufacturing inventory for new product launches. Now recall that one lesson from our successful Udenyca launch is that going to market with ample supply is a critical success factor. Also, recall that low-cost inventory manufactured and expensed prior to FDA approval subsequently delivers P&L benefit in the form of lower COGS.

Another $40 million to $50 million of operating expense this year will fund the completion of development of additional presentations of products we expect to introduce over the next two 2 as, well as manufacturing scale-up projects, that will deliver ongoing benefits in the form of significantly lower cost of goods. Finally, on the investor relations front, we will present and host investor meetings in March at two conferences, the Cowen conference and also the Barclays conference. And we are planning to host the Coherus analyst day event in late March in New York City, hopefully, in person. And I will now turn the call back to Denny for closing remarks. 

Denny Lanfear -- Chief Executive Officer

Thank you, McDavid. A year ago, we told you that our vision for Coherus was to become an innovative immuno-oncology company with a commercial I-O assets promising clinical-stage programs and novel in-house preclinical pipeline. With the potential approval of toripalimab in April, the initiation of a clinical trial evaluating TIGIT in combination with toripalimab later this year, and the advancement of the first of our in-house I-O assets for IND, we are delivering on this vision and we laid out to investors a year ago. The levers of success are now in our own hands.

I am proud of the execution of my team and confident that we will fulfill the promise of our strategy. On the commercial side, we are uniquely positioned to launch multiple new products in the next 18 months. With these launches, the total addressable market opportunity for our product portfolio will increase tenfold from about $2.5 billion to more than $25 billion. Our commercial opportunity will continue to expand as additional toripalimab indications are added and as our immuno-oncology pipeline candidates advance to commercialization.

This growing product portfolio will fund our continued growth in immuno-oncology through the end of this decade. Operator, we're ready for the questions. 

Questions & Answers:

Operator

Thank you. [Operator instructions] And our first question comes from the line of Salim Syed with Mizuho. Your line is open. Please go ahead. 

Salim Syed -- Mizuho Securities --Analyst

Hey, good afternoon, guys. Thanks so much for the color. A couple for me, if I can. One, on toripalimab so I would like to understand a little bit more about the strategy here in lung post an assumed NPC approval late April, specifically, the prospects of getting toripalimab listed as a category to be medication on NCC guidelines and the prospects of a subsequent Medicare reimbursement off-label uptake in lung? Or do you really think you'll need an additional trial in lung that's head-to-head versus a PD-1 and how those costs would be allocated or shared? And then the second question is on the Udenyca guidance for '22.

So, Denny, I appreciate that it's going to be lower -- then revenues will be lower than '21. But how are you thinking about ASP declines in '22 -- 2021, by my math, had roughly about a 20% to 30% ASP decline. So this is now the fourth year post launch, should we be thinking about that moderating in '22? And then also with COVID cases largely declining here and Onpro still having 50% of the pegfilgrastim market. Just maybe you could speak about qualitative here your views on units, please? Thanks so much. 

Denny Lanfear -- Chief Executive Officer

Thank you for that, Salim. I would ask that follow-on questions, limit themselves to one question, then -- so we can work through. And then if your question is not answered, we're happy to go through. So let me direct the question of the non-small cell regulatory strategy that you posed to Dr.

LaVallee. Theresa, do you want to answer that one?

Theresa Lavallee -- Chief Development Officer

Yeah. Thanks, Denny, and thanks for the question. I mean for non-small cell lung cancer, we haven't had any meetings with the FDA since the ODAC and look forward to discussing the path forward with them, continue to be impressed with the data. And I think for the overall tone of how the FDA is reviewing these data that kind of given some bookends between the NPC indication and non-small cell lung cancer.

So our strategy is to have frequent and often conversations with them and align on the packages.

Denny Lanfear -- Chief Executive Officer

Thank you, Theresa. Any additional comment with respect to the endpoints of our study or other aspects to Salim's question?

Theresa Lavallee -- Chief Development Officer

The endpoints that we have are for overall survival with a prespecified secondary endpoint and was part of the statistical analysis plan, which was designed to meet FDA filings.

Denny Lanfear -- Chief Executive Officer

Thank you. Thank you for that. And I think your second question, Salim, was with respect to second half of the year sales or 2022 sales. Paul, can you offer Salim additional color on what we see for Udenyca through the rest of this year?

Paul Reider -- Chief Commercial Officer

Yeah. Thanks for your question, Salim. Yes. So I think it's reasonable to expect continued price declines in this market.

throughout 2022, as it's becoming increasingly competitive. And I think if you look at our ASPs, we've been averaging mid-single digits over the last three quarters.    Our strategy has really been to balance price and market share as we look to optimize longer-term revenues for Udenyca. In 2022, it's going to be within the context of the prefilled string segment. But we're going to be ready to go with the launch of an on-body device in 2023, if approved, to go after that remaining 50% of the Onpro market that's I think, just been able to entrench itself through for the persistence of COVID.

So that's what we're thinking. 

Denny Lanfear -- Chief Executive Officer

I hope that answers your question, Salim. We'll be happy to loop back with you if you have a little more follow-ons to that. Operator, can we have the next question?

Operator

Our next question comes from the line of Ken Cacciatore with Cowen. Your line is open. Please go ahead. 

Denny Lanfear -- Chief Executive Officer

OK.

Operator

Ken, your line might be on mute. OK. We'll move to our next question, which is Georgi Yordanov with Cowen & Company. Your line is open.

Please go ahead.

Georgi Yordanov -- Cowen and Company -- Analyst

Hey, guys. Thanks so much for taking our questions. We're going to limit to one. So on the recently announced partnership for the TIGIT asset, could you maybe talk about how you see it being differentiated from the more advanced TIGIT antibodies that are in later stages of development out there? And then you mentioned your intentions to run trials here in the U.S.

in combination with [Inaudible] therapy. Could you remind us of the expected R&D costs for that associated with that development? And what percentage of that you're responsible for?

Denny Lanfear -- Chief Executive Officer

Let me take the last part first with respect to cost. And then I'll let Theresa describe our strategy around the TIGIT. With respect to cost, you may recall that the agreement with Junshi, limits our shared clinical cost to $25 million per year per product. That is the same for toripalimab as it is for the opted-in, in products which TIGIT, JS006 is one.

So we presume that this will be done under the auspices of the Joint Steering Committee of other partnership and subject to those caps. Now if there's additional work that we want to do, outside of that that may be some additional things that is not paid for to the partnership. And then Junshi has the opportunity to opt back into that data later. Given that this asset, however, will be developed internationally, globally across all markets, it's probably safe to assume that this will be primarily developed through the Joint Steering Committee of other partnership.

With respect to TIGIT development, potential differentiation, and our strategy of going into lung. Theresa, would you like to make a few comments on that?

Theresa Lavallee -- Chief Development Officer

Yeah. And I think the data we've seen from our partner, Junshi, on the TIGIT antibody is it has significant potency in preclinical models. And we look to develop it in tumor types such as non-small cell lung cancer, obviously, to established proof of principle in combination with toripalimab, with a translational strategy to really understand where we see activity -- and not activity to advance it with urgency.

Denny Lanfear -- Chief Executive Officer

The only other additional color I would provide with respect to the TIGIT is, we have developed and co-formulated approaches to the product, which would be single vial. Operator, we're ready for the next call.

Operator

Our next question comes from the line of Chris Schott with J.P. Morgan. Your line is open. Please go ahead. 

Chris Schott -- J.P. Morgan -- Analyst

Great. Thanks so much. I'm going to slip 1.5 questions in. I just come back to the toripalimab discussion earlier.

Would you run a U.S.-based head-to-head study in non-small cell lung cancer, if FDA required? Or is that kind of a nonstarter as you think about -- I know you still need to meet with the FDA, but if that's what they're asking for. Is that something that makes sense for Coherus or not? And my core question was coming back to biosimilar Humira. I think there's been a lot of debate about how much volume AbbVie is going to be able to contract here? And how many biosimilars each payer is going to cover. So can you just elaborate a little bit more on how you think that plays out as you look out to 2023 and beyond? Do you think it's going to be in a situation where there's multiple biosimilars and it's kind of a jump ball is about commercial execution or do you expect the payers to kind of focus in on like one or two biosimilars? And do you expect that AbbVie is going to be able to retain a sizable portion of the market? Or do you expect that a lot of the volume in this space is going to be available to the biosimilar players? Thanks so much. 

Denny Lanfear -- Chief Executive Officer

Thanks. Thank you for your 1.5 -- I think you have one and a three quarters questions there, Chris, but that's OK. First [Inaudible] the Yusimry-Humira biosimilar question for you, and then we'll loop back on toripalimab. Paul?

Paul Reider -- Chief Commercial Officer

Yeah. Thanks for your question. So at the time of our launch in July 2023, we will expect to be one of a number of biosimilars entering the market at the same time. And what we'll be prepared to do at that time is to bring a value proposition that includes those factors that I mentioned in my prepared remarks, a very competitive price, substantial supply guarantees, and all of the prefilled syringe in auto-injector types of presentations.

The non-sting citrate-free formulation will be another differentiator. And so I think what we expect to happen is we're going to through our payer segmentation is not look at them all as a one size fits all, but to fit their particular objectives based on their plans, their covered lives, and their businesses. and to deliver the value proposition that depending upon the control level of the plan might be a single biosimilar and a rapid conversion away from the innovator or in the short term of launch, Humira plus Yusimry, in which case it will be a slower transition over time. Either way, we'll have a portfolio of the value proposition that will meet their needs, and we will expect to be one of the most compelling high-volume, low-cost providers at the time of commercialization midyear.

So we expect to do very well.

Denny Lanfear -- Chief Executive Officer

The other point I would make with respect to that, Chris, is we think with the number of competitors in the market, there's going to be tremendous cost pressure all around. And we would be surprised if AbbVie two or three years into the market did not have a relatively small share of that market as opposed to a majority greater than 50% share. So we think they'd probably get down to the 20%, 25% type of share gain. With respect to your question on toripalimab and the potential regulatory pathway there in mind.

It's -- we believe it's probably prudent for us not to pre-empt our conversations that we haven't had with the FDA. As Theresa said, we haven't really had a chance to interact with FDA post the ODAC. And we look forward to doing that. We're convinced that we have a very high-quality molecule.

It's demonstrating significant efficacy and safety across a number of indications, including lung. So we're very enthusiastic about talking to the FDA about that. But we really think it's probably not prudent to talk about what sort of studies they might require and when and that type of things. That being said, though, we are planning on moving into lung with the TIGIT asset in conjunction with toripalimab.

And you'll be hearing more of that later in her prepared remarks. Theresa, of course, talked about that and how we are going to move in toward the end of this year. So stay tuned on that one.

Chris Schott -- J.P. Morgan -- Analyst

Thank you. 

Denny Lanfear -- Chief Executive Officer

Thanks, Chris. 

Operator

And our next question comes from the line of Balaji Prasad with Barclays. Your line is open. Please go ahead.

Balaji Prasad -- Barclays -- Analyst

Hi. Good evening, everyone. So firstly, getting back to biosimilar Humira, can you quantify whether the non-stinging citrate-free formulation and what kind of an advantage it provides to you? And also probably importantly, do you expect to be the only citrate-free formulation on the market next year, one. And two, if you can just also quantify with your clinical trials with the multiple trials going on with $417 million in cash.

If you need to prioritize your clinical trials, what would be the top one or two ones that are going to advance next year? Thank you. 

Denny Lanfear -- Chief Executive Officer

Thank you, Balaji. Let me first address the issue of the formulation. It's very important from the viewpoint of patient comfort upon injection that the formulation does not stay and it's not unduly uncomfortable. And there's anecdotal data that patients found the previous low concentration formulation of AbbVie, very uncomfortable because those have citrate.

So several years ago, when we approached the Humira biosimilar, which was 1420 at that time, we developed a proprietary non-stinging, citrate-free formulation. Now I won't speak for others, but I think this is very, very important from the viewpoint of patient comfort and being able to penetrate the markets, as Paul said. Now with respect to the clinical trials, in 2022 at various cost infact as McDavid pointed out to you, there are significant spends on matters such as manufacturing. One of the ways that we succeeded with Udenyca, and you may recall, we stockpiled 300,000 syringes prior to launch.

As significant manufacturing expenses, it was $25 million to $35 million when we did it. And however, I think that served us very, very well post launch. We were able to do supply guarantees and did very well in that market, while others were not able to do so. And I think that was one of the reasons why we achieved in excess of 20% market share in that market.

We think that very same formula applies here, for example, with Humira. We have gone to large scale. We've made those investments. We will be prepared, for example, for fierce competition and price that we have to.

But we think that we want to be the team that has the inventory and the supply guarantees to be able to go in the market for that. And that's where, I think, some significant parts of our spend go. But on the other hand, we think that's very wide. And as McDavid indicated in his remarks, that pays back later.

That goes into COGS. It's expense now, but that gives you an advantage and there's a significant IRR. I hope that answers your question.

Operator

Thank you. And our next question comes from the line of Jason Gerberry with Bank of America. Your line is open. Please go ahead.

Jason Gerberry -- Bank of America Merrill Lynch -- Analyst

Hey, guys. Thanks for taking my question. My is on the NPC U.S. market opportunity, can you just talk a little bit about your expectations here with this, you expect it to be used more frontline with the chemo combination or second-line monotherapy? How many of these patients are really addressable? Is it going to be hard to find these patients because it's a pretty small population? And it seems like there's a pretty big swing factor of your frontline versus second line, I think the interim PFS was 12 months from frontline, but I think in like second line, it was much shorter.

So just trying to get a sense if you can kind of frame the key parameters of an oncology forecast. .

Denny Lanfear -- Chief Executive Officer

Thanks for the question on that. Of course, we expect to get frontline with NPC. I'll let Paul fill in the rest of your question with respect to the market size and so on. Paul?

Paul Reider -- Chief Commercial Officer

Yeah. Thanks for your question, Jason. So yes, as a rare cancer, the data suggests that there's a couple of thousand patients treated with NPC annually and about one-third of those patients are cycled through in the first-line setting. And so as we expect, if approved, to be the first and only PD-1 antibody approved for NPC, including first line, that's where we believe we have the potential to establish a new standard of care that really in combination with chemotherapy plus toripalimab, will be the standard of care in frontline patients.

The patients were treated with chemotherapy only in first line. It's likely they're going to progress. And then we've got the data in later lines of therapy that we'll expect to pick them up later on. But we want to get these patients treated frontline.

Yes. So there's not a lot of them, Jason, but we -- looking at our data with about 1,500 HCPs that we see are using PD-1s for NPC, and they account for over half of the patient volume. And we've got significant overlap with our current Udenyca base. And so we'll have high overlap very synergistic at the time of launch to drive share voice and the toripalimab of NPC story there.

And the fact that the data has already been widely presented by ASCO Plenary in 2021. The study was published in Nature Medicine last year. And of course, now NCCN guidelines has added it -- provides a real tailwind force going into a potential launch here.

Denny Lanfear -- Chief Executive Officer

Jason, the other thing we would add here, of course, I will also get second and third line. And so we're going to pursue NPC quite holistically. And as Paul indicated, we think we have a very strong case therapeutically with the ASCO Plenary session and Nature of Medicine and so forth. After we get the approval under our belts and we get into the market through a few months, I think your question is fair game with respect to forecasts and so on, we'll be happy to loop back to.

Jason Gerberry -- Bank of America Merrill Lynch -- Analyst

Can you just remind me in the frontline setting, what the PFS was? And when you say one-third cycle through first line. So basically, of a couple of thousand, only one-third of them make it second line. Was that the point or only one-third of a couple thousand ultimately get treated in the frontline setting?

Denny Lanfear -- Chief Executive Officer

Theresa, do you want get that one?

Theresa Lavallee -- Chief Development Officer

Yeah. The PFS in first line was 11.7 months with a one-year PFS of 49%.

Denny Lanfear -- Chief Executive Officer

Yeah, Jason. And then of the couple of thousand patients treated annually, about one-third get treated in the first-line setting.

Jason Gerberry -- Bank of America Merrill Lynch -- Analyst

OK, great. Thanks so much. 

Operator

And our next question comes from the line of Douglas Tsao with H.C. Wainwright. 

Douglas Tsao -- H.C. Wainwright -- Analyst

Now added sort of your own internal R&D capabilities, discovery in I-O. I'm just curious how...

Denny Lanfear -- Chief Executive Officer

Forgive me, Doug, I think we missed the first part of your question. Could you restart?

Douglas Tsao -- H.C. Wainwright -- Analyst

Oh, yeah, sorry. You've now started your sort of own internal discovery efforts in I-O, it sounds. And I'm just curious, as you sort of add to your own capabilities, how do you see your vision for growing the business versus business development? Obviously, you're going to be launching a number of products your cash flow should be quite significant -- do you have sort of bias toward now focusing on sort of internally developed assets versus ones that you might want to acquire? And as that cash flow comes in, do you potentially think about new business development and M&A more aggressively? Thank you. 

Denny Lanfear -- Chief Executive Officer

That's a great question. Doug. It's very important to us that we have a portfolio that's balanced across all three stages of development: preclinical, early stage development, mid-stage development representative by, for example, the TIGIT and TIGIT toripalimab combinations. And then late stage, of course, with the potential approval of toripalimab.

I'll let Theresa talk a little bit about our early stage development efforts. But to cut to the chase and answer your question directly, we certainly would be open for business development opportunities with I-O. There's a lot of opportunities out there, and we have a number of folks who approach us from time to time with various assets we haven't locked in anything so far, but we continue to look at them. Theresa, you want to say a few things about our early stage pipeline?

Theresa Lavallee -- Chief Development Officer

Yeah. I think having recently joined one of the things that really attracted me to Coherus was the people and the talent in addition to having great assets. What surprised me was how strong that science was and the preclinical aspects and looking at the early pipeline and how well it's been put together and really targeting important aspects of the tumor micro environment that the field is really going after broadly. To think about we have starting on the T cell with you have to have a PD-1 so toripalimab is an excellent molecule.

And then coming in with the TIGIT as an important way to really get the T cells activated and have that antitumor immunity. But if you have a supressed microenvironment and active T cell still is hindered. So I think the portfolio really looking at that is going to be exciting. And as we advance the stages, I mean I'm really looking forward to getting an enhanced IND next year and starting an in-house clinical trials.

Denny Lanfear -- Chief Executive Officer

The other comment I would offer you, Doug, is we will be covering our in-house assets in more detail at our investor meeting. McDavid indicated around what around the end of March in New York. And we'll bring out some key personnel as we're working on this and explain the mechanism of action, a few things that we're doing. So I think you'll find it interesting.

Douglas Tsao -- H.C. Wainwright -- Analyst

OK, great. Look forward to the event. 

Operator

Thank you. And I'm showing no further questions at this time, and I would like to turn the conference back over to Denny Lanfear for any further remarks.

Denny Lanfear -- Chief Executive Officer

Thank you. We want to thank you all for joining us today for our end of the year and our fourth quarter conference call. We look forward to seeing you at the upcoming conferences at Cowen and so forth. And we also look forward to talking to you in more detail at our investor day event at the end of March.

Thank you.

Operator

[Operator signoff]

Duration: 56 minutes

Call participants:

McDavid Stilwell -- Chief Financial Officer

Denny Lanfear -- Chief Executive Officer

Theresa Lavallee -- Chief Development Officer

Paul Reider -- Chief Commercial Officer

Salim Syed -- Mizuho Securities --Analyst

Georgi Yordanov -- Cowen and Company -- Analyst

Chris Schott -- J.P. Morgan -- Analyst

Balaji Prasad -- Barclays -- Analyst

Jason Gerberry -- Bank of America Merrill Lynch -- Analyst

Douglas Tsao -- H.C. Wainwright -- Analyst

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