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FGEN FibroGen

Participants
Michael Tung Investor Relations Executive
Enrique Conterno Chief Executive Officer
Mark Eisner Chief Medical Officer
Pat Cotroneo Chief Financial Officer
Joel Beatty Citi
Michael Yee Jefferies
Edwin Zhang H.C. Wainwright
Geoffrey Porges SVB Leerink
Annabel Samimy Stifel
Jason Gerberry Bank of America
Yaron Werber Cowen
Andy Hsieh William Blair
Difei Yang Mizuho Securities
Call transcript
Operator

Ladies and gentlemen, thank you for standing by, and welcome to the FibroGen Fourth Quarter and Full Year 2020 Financial Results Conference Call. [Operator Instructions] Please be advised that today's conference is being recorded. [Operator Instructions] I would now like to hand the conference over to your speaker today, Mr. Michael Tung. Thank you. Please go ahead, sir.

Michael Tung

Thank you, Linden. And good afternoon, everyone. I’m Michael Tung, Vice President of Corporate Strategy and Investor Relations at FibroGen.

Joining me on today's are Enrique Conterno, our Chief Executive Officer; Percy Carter, our Chief Scientific Officer; Pat Cotroneo, our Chief Financial Officer; Dr. Mark Eisner, our Chief Medical Officer; Thane Wettig, our Chief Commercial Officer; Chris Chung, our Senior Vice President of China Operations; and Dr. Elias Kouchakji, our Senior Vice President of Clinical Development, Drug Safety, and Pharmacovigilance. The format for today's call includes prepared remarks from Enrique and Pat after which we will open up the call for Q&A. I'd like to remind you that remarks made on today's call include forward-looking statements about FibroGen. Statements may include, but are not limited to our collaborations with AstraZeneca and Astellas; financial guidance; the initiation, enrollment, design, conduct and results of clinical trials; our regulatory strategies and potential regulatory results; our research and development activities; commercial results and results of operations; risks related to our business; and certain other business matters. Each forward-looking statement is subject to risk and uncertainty that could cause actual results and events to differ materially from those projected in that statement. A more complete description of these and other material risks can be found in FibroGen's filings with the SEC, including our most recent Form 10-K and Form 10-Q. FibroGen does not undertake any obligation to update publicly any forward-looking statements, whether as a result of new information, future events or otherwise. The press release reporting our financial results, and business update and a webcast of today's conference call can be found on the Investors section of FibroGen's website at www.fibrogen.com. With that I would like to turn the call over to Enrique Conterno, our CEO. Enrique?

Enrique Conterno

Very good. Thank you, Mike. And good afternoon, everyone. And welcome to our fourth quarter and full year 2020 earnings call. I intend to reflect on my first year as CEO of FibroGen by providing a high-level summary of important accomplishments and developments, not only in recent months, but also for 2020. Pat Cotroneo, our CFO, will then review the financials after which we will open the call for your questions. I continue to be confident in my assessment of FibroGen has a unique opportunity to create significant value for patients and shareholders by executing on our three areas of focus. Number one, ensuring regulatory and commercial success of roxadustat, a transformational medicine for the treatment of anemia first in patients with chronic kidney disease and with significant potential for expansion to additional indications. Number two, accelerating the development of pamrevlumab mapping three high-value indications, locally advanced unresectable pancreatic cancer, Duchenne muscular dystrophy, and idiopathic pulmonary fibrosis. And number three strengthening our research capabilities to maximize our scientific and medical leadership position in both HIF and CTGF biology.

In addition, we are focused on expanding our clinical development pipeline by evaluating both internal and external opportunities to address unmet medical needs. Today’s call will include a review of Roxadustat; our continued strong performance in China and our clinical trial programs.

Let us get started with the Roxadustat new drug application, or NDA review. Last December in the final stages of review, the FDA extended the review period of the NDA by three months to review additional analysis of existing clinical data and set a new PDUFA date of March 20, 2021.

Just today, we were informed by the FDA that they plan to hold an Advisory Committee or AdCom meeting to review the NDA for Roxadustat in the us.

We have not received the schedule for the planned outcome. We're surprised by the timing of this request on three separate locations, the FDA indicated they were not planning to hold an AdCom at the time.

First, when the NDA filing was accepted, then after the mid cycle review, and finally, after the late cycle review. It would not be unusual for the FDA to hold an AdCom for a first-in-class, new molecular entity. And as communicated last spring, we were preparing for this possibility.

We will now resume those preparation activities and look forward to presenting deep comprehensive Roxadustat data.

We continue to have confidence in the completeness of our NDA submission and the strength of our data and the FibroGen and Astrazeneca are committed to working with the FDA to bring Roxadustat to patients with anemia CKD in the U.S.

As you can appreciate and has been the case throughout the final stages of review, we will not be able to discuss the details of our FDA interactions.

Our pre-commercial activities continued as planned. FibroGen had its largest presence ever at the American Society of Nephrology's Kidney Week Conference in October of last year. And there continues to be significant interest in Roxadustat from the clinical community. The momentum generated at ASN continues with additional analysis and plan disclosures of our Phase 3 data in order to maintain our HIF-PHI scientific and clinical leadership position. Patient and healthcare professional disease education activities are ongoing and expect to increase through the official launch.

Our partner, AstraZeneca, has a comprehensive renal commercial presence in the U.S., and together we're committed to make roxadustat available to as many CKD patients as quickly as possible. To optimize patient access, AstraZeneca is leading the discussions with both dialysis organizations or payors, who cover non-dialysis patients.

We have submitted manuscripts covering the Phase 3 study for CKD anemia at the peer-review journals.

As you can see on slide, five of these manuscripts have been published, covering non-dialysis-dependent, dialysis-dependent and incident dialysis data. Details on these publications can be found in our press release, and we expect additional publications of Phase 3 data in the coming months. In Japan, our partner, Astellas, received an additional events approval for the treatment of anemia CKD in adult patients not on dialysis in November of 2020.

In addition, in December of 2020, the 14-day prescription rule was lifted for EVRENZO.

As a result of these two events, Astellas has seen an acceleration in EVRENZO’s uptick. The European Medicines Agency accepted our roxadustat Marketing Authorization Application for the treatment of anemia in adult patients with chronic kidney disease, both on dialysis and not on dialysis in May of 2020.

We expect a decision mid-year.

Moving now to China, we're pleased to report net sales of roxadustat of $29.2 million for the fourth quarter versus $22.7 million in the third quarter. The total net roxadustat sales in China for 2020, the first year roxadustat was included in the NRDL, were $72.5 million. The continuing increase in uptake is being driven by both an expansion in hospital listings and broad adoption within listed hospitals. Hospital listings continued to be a key focus of our launch efforts. Notably, as of the end of the year, roxadustat was listed at hospitals represented approximately 70% of the CKD anemia market opportunity in China. This is in comparison to 55% at the end of the third quarter. We're driving towards our goal of making roxadustat the number one treatment option for anemia CKD patients in China.

We continue to see significant roxadustat utilization across a range of anemia CKD patient populations. Approximately 60% of patients treated with roxadustat in China are on dialysis, split between haemodialysis and peritoneal dialysis, within haemodialysis initial adoption has been in patients who do not respond well to ESAs, as well as in incident dialysis patients. The remaining 40% of roxadustat treated patients are CKD anemia patients, not on dialysis. This broad utilization pattern bodes well for long-term success and provides critical learnings as we prepare to launch roxadustat in the U.S. and in other countries. We look forward to keeping you updated as we advance our long-term goal of making roxadustat the standard of care in treating China's CKD anemia patients.

Moving now to our clinical development. On our third quarter earnings call, we provided timeline guidance for most of our clinical trials.

We are reiterating that guidance today, and do not intend to update this guidance on a quarterly basis, but it's still only where we have meaningful changes. Starting with roxadustat. We recently completed an enrollment in Whitney, our Phase 2 trial in patients with chemotherapy-induced anemia on top line data is expected in the second half of this year. After conclusion of this trial is successful, we plan to initiate the Phase 3 program in collaboration with AstraZeneca and Astellas. MATTERHORN, our Phase 3 trial in patients with anemia of myelodysplastic syndromes or MDS continues to enroll with top line data expected in the first half of 2022.

Finally, we recently completed enrollment of ASPEN and DENALI, our two Phase 3b studies of roxadustat in CKD anemia with large dialysis organizations in the United States.

Moving now to pamrevlumab. In locally advanced unresectable pancreatic cancer, our LAPIS Phase 3 trial is enrolling well with top-line resection data expected in the second half of 2022.

Moving to Duchenne muscular dystrophy, enrollment continues in our LAPIS Phase 3 trial in non-ambulatory patients with top-line data also expected in the second half of 2022.

Finally, in idiopathic pulmonary fibrosis, we recently initiated our ZEPHYRUS-2 Phase 3 trial in December. IPF patients have severely compromised lung function, and the current COVID situation continues to be extremely challenging for enrollment in both our pamrevlumab trials ZEPHYRUS and ZEPHYRUS-2. Despite the circumstances, we have activated a significant number of additional clinical trial sites and expanded geographically, including in China, such that when COVID improves, which have been a position to accelerate enrollment in both trials expeditiously.

Given the different COVID scenarios, there is variability in our projected IPF timelines, and we'll provide you with an update at the appropriate time. Accelerating enrollment of all of our ongoing clinical trials, while ensuring patient safety continues to be a top priority.

Now, let me touch briefly on the application of our pioneering expertise in hypoxia-inducible factor or HIF, 2-oxoglutarate enzymology [ph] and connective tissue growth factor or CTGF biology in order to advance innovative medicines for the treatment of anemia, fibrotic disease and cancer. In 2020, we completed a thorough internal review of all of our programs, and we plan to continue advancing internal molecules in our development pipeline.

In addition, we are seeking to access external innovation.

Finally, it is my pleasure to address another important accomplishment, the hiring of significant leadership talent, which includes the appointments of Dr. Percy Carter, our Chief Scientific Officer; Dr. Mark Eisner, our Chief Medical Officer, and Thane Wettig, our Chief Commercial Officer. In summary, 2020 was a productive transitional year and look forward to more progress against our stated goals in 2021. I will now turn the call over to our CFO, Pat Cotroneo for the financial update. Pat?

Pat Cotroneo

Thank you, Enrique.

As announced today, total revenue for the fourth quarter of 2020 was $65 million, as compared to $8 million for the fourth quarter of 2019. The current quarter revenue consists of net product revenues of $29.2 million for roxadustat sales in China, $21.5 million in development revenue, and $14.3 million in license revenue related to NDD approval in Japan.

For the same period, operating costs and expenses were $123 million and net loss was $58.6 million or $0.64 per basic and diluted share as compared to operating cost and expenses $108.4 million and a net loss of $98.1 million, or $1.12 per basic and diluted share for the fourth quarter of last year. Included in operating costs and expenses for the quarter ended December 31, 2020 was an aggregate non-cash portion, totaling $26.9 million of which $20.3 million was a result of stock-based compensation expense as compared to an aggregate non-cash portion of $22.1 million of which $17.4 million was a result of stock-based compensation expense for the same period in the prior year. At December 31, FibroGen had $732.1 million in cash, cash equivalents, restricted time deposits, investments, and receivables. At this time, I would like to outline some changes in financial reporting starting next quarter that result from the amendment to our China agreement with AstraZeneca.

As we have previously reported, the amendment is expected to result in earlier and more consistent profitability to FibroGen based on the continued 50:50 profit share with AstraZeneca. Under the amendment, we have formed a jointly owned distribution entity, the JDE that began operations in Q1 2021. The JDE will be responsible for selling roxadustat to distributors, and will pay for AstraZeneca's commercialization efforts in China, and AZ’s portion of profit share. Previously FibroGen was responsible for these items. The JDE is expected to account for over 95% of overall China roxadustat sales volume going forward, while the rest will continue to be conducted directly by FibroGen. Starting in Q1 2021, FibroGen’s revenue will be based on sales to the JDE at a transfer price, as well as FibroGen’s direct sales. The transfer price is expected to be in the range of 30% to 45% of JDE net sales, which reflects the JDE pain both AstraZeneca's commercialization expenses and AstraZeneca's portion of the profit share.

In addition to continue to provide context for the operating results of our roxadustat business in China, we also plan to share the overall net sales of roxadustat, i.e., the combination of n sales by AstraZeneca and n sales by FibroGen.

Looking ahead at our broader financial picture, we have a total of $245 million of potential milestones expected this year for anticipated U.S. and EU approvals and first commercial sale in the U.S. At this point in time, we have no changes and expectations in any of the anticipated milestones between now and the end of the year. Based on our latest forecast data, we estimate our 2021 ending balance of cash, cash equivalents, restricted time deposits, investments, and receivables to be in the range of $660 million to $670 million, assuming U.S. and EU approval in 2021. Thank you. And I would now like to turn the call back over to Enrique.

Enrique Conterno

In closing, this is an important time for FibroGen. Roxadustat has launched in China, Japan and is under regulatory review in the U.S., Europe and other geographies. Pamrevlumab is a wholly on potential first-in-class new medicine in Phase 3 development in the three high value indications of locally advanced unresectable pancreatic cancer, Duchenne muscular dystrophy, and idiopathic pulmonary fibrosis.

We are reenergizing a research agenda to deliver on our unique scientific expertise. In parallel, we're building world class research capabilities internally, while also looking externally for opportunities, with the goal of expanding our pipeline of innovative drug candidates.

We have strengthened our leadership team, which would be instrumental for our strategic growth.

We are in a strong financial position as roxadustat sales ramp up with approximately $732 million in cash, and another $245 million in anticipated roxadustat milestone payments expected during 2021.

Looking forward, I believe we're clearly positioned for success.

Now, I'd like to turn the call back to the operator for questions.

Operator

[Operator Instructions] Your first question comes from Joel Beatty from Citi.

Your line is open.

Joel Beatty

Hi, thanks for taking the questions.

The first one is, are you able to share anything about the topics that you're preparing to address at the AdCom?

Enrique Conterno

Thank you, Joel.

Let me provide just a brief answer. I'm going to ask also Mark Eisner to comment. But clearly at this point in time, we're not in a position to provide an update on that as you know, there's typically a report that the FDA will basically make public prior to the AdCom that's only a few days before the AdCom is actually failed. We don't have a set date for the AdCom at the stage, and we do not provide to comment on regulatory interactions with the FDA. Mark – I'm going to ask Mark Eisner if he has any additional comments.

Mark Eisner

Yes, no. And thanks for the question.

As you know, the FDA uses advisory committees to bring in external scientific clinical or other perspectives into its review, and it would not be unusual to have an AdCom for first-in-class new molecular entity. In this case, what's surprising is the timing as Enrique had alluded to in his introductory comments. At this point, we're going to resume our preparation activities for the advisory committee, and we'll look forward to presenting the comprehensive roxadustat program and its data.

We continue to have confidence in the completeness of our NDA submission, the strength of our data, and along with our partner AstraZeneca, we're committed to working together with the FDA to bring roxadustat to patients with anemia CKD in the U.S.

So, thanks again for the question.

Joel Beatty

Thanks. And maybe one follow-up to that. Can you share anything about how you and AstraZeneca collaborate for the AdCom preparations and if there's one company taking the lead?

Enrique Conterno

Yes, this is really a – it has been a joint effort, the joint process. Clearly AstraZeneca has considerable expertise when it comes to AdComs. And we need to make sure that that is being fully leveraged. But I think the – when we were preparing back in the spring, that was the case very collaborative. I expect that it will continue to be very much a joint effort.

Joel Beatty

Great. Thank you very much.

Operator

Your next question comes from Michael Yee from Jefferies.

Your line is open.

Michael Yee

Hi, guys. Thanks. Two questions for you guys.

You can understand that people are, I guess, confused and a bit perplexed by the timing and also just the chronology of how things are played out.

So, the first question is just maybe Enrique, can you just give us some comfort such that the discussions here or the debates or the issues here are more of a labeling and black box safety scenario question, such that whatever happens here, you don't believe that peak sales are likely to change too much. And you've kind of made that comment before, but maybe you could comfort us in some way.

The second question is more of a logistical question for the team.

I think that you can't really have two formal PDUFA extensions if you go look at document, so do you just expect that we're going to pass the PDUFA date, have to deal with an AdCom and then we just kind of go from there or do you expect that the PDUFA would actually be formally changed? So, we would have some visibility on things. Thank you.

Enrique Conterno

Yes. Thank you for your question, Michael. Clearly, I think, let me try to address maybe the first part, the last part of your question.

Our understanding is that the PDUFA date can be extended once that extension happens.

So, at this point in time, we expect that the PDUFA date will be missed and therefore we will have the AdCom at some point in time, but we no longer basically an active PDUFA date.

I think, your – the first part of your question was related to being more specific on the nature of the AdCom clearly. When it comes to AdCom, AdComs are looking at the overall benefit risk profile of the product.

Of course, they tried to get external scientific expertise to bear. But I'm not in a position to be able to comment on the nature of that. And I think we have to prepare for it. And I – we want to see of course when this AdCom will be scheduled, we don't have a set date for it at this time. Keep in mind that we were notified of this today.

Michael Yee

Well, okay. Thank you.

Operator

Your next question comes from Edwin Zhang from H.C. Wainwright.

Your line is open.

Edwin Zhang

Hi, thanks for taking my questions.

First one, how much do you think is this AdCom decision related to the new analysis you submitted to the FDA two months ago. And second to follow up on the PDUFA date.

Just to clarify, are you going to get a new PDUFA date from the FDA or not? And when are we going to know the new PDUFA date if there is one? Thank you.

Enrique Conterno

Yes. Yes, we don't believe there will be a new PDUFA date, given that there was already an extension. And I'm sorry, I missed the first part of your question.

Edwin Zhang

So how much do you think this AdCom decision from the FDA is related to the new analysis you submitted to the FDA two months ago?

Enrique Conterno

Yes, we don't want to speculate.

Edwin Zhang

Okay. Maybe one more. After this regulatory decision change your expectation of a clean or differentiated level compared to ESAs.

Enrique Conterno

Yes, I think at this point in time, we have to go through the AdCom.

We have a product with a significant amount of clinical data. Keep in mind, there are pivotal data for the U.S., including over 8,000 patients. We discussed the clinical data at length.

We continue to stand behind our data and the strength of the data, some of the data now has been published. There are five primary manuscripts that have been published, and a number of more that are upcoming. But at this point in time, I don't want to speculate on the nature of the AdCom. We very much look forward to have the opportunity to share the roxadustat data in a public forum.

Edwin Zhang

Great. Good luck on the AdCom. Thank you.

Operator

Your next question comes from Geoffrey Porges from SVB Leerink.

Your line is open.

Geoffrey Porges

Yes. Thank you. A number of questions related to this topic.

First, Enrique, you're answering a lot of these regulatory questions. It would be helpful with the official regulatory representative for FibroGen could answer the questions. But why doesn't this amount to a complete response letter to your application, and particularly given the amount of time it's going to require to prepare a full company package and the FDA's package. It would seem sudden that it's going to be much more than 30 days after the prior PDUFA date.

Secondly, it's going to certainly be hard for us and investors to be confident in your approval since as far as we know, you've replaced most people in the organization who are familiar with the very extensive amount of clinical data. And then lastly, could you confirm whether this review or the – whatever the AdCom is going to be, will it be held by the hematology division or the cardio-renal division, and will it be examining and hearing the objections from the citizens' petitions? Thank you.

Enrique Conterno

Yes.

So, let me try to address some of your questions. I'm going to also ask Mark Eisner to maybe make some comments that he has formal as a Chief Medical Officer also has regulatory responsibilities.

First, the advisory committee we believe is going to be the cardio-renal advisory committee.

So that's how we understand it based on the communication with the FDA which happened today. We – I think you are making reference to Peony Yu’s retirement as Chief Medical Officer, keep in mind, the Peony is still our employee of FibroGen at this stage, and she also has an agreement, a consulting agreement over the next six months, both for employment here at FibroGen to continue to provide advice. I feel that the strengths of our team, is considerable when it comes to roxadustat data, not just here at FibroGen, but also AstraZeneca. And then, I'm going to ask Mark Eisner to also provide some additional comments or add to what I'm sharing.

Mark Eisner

Yes. Thanks, Enrique.

So, the FDA did not issue a complete response letter. A complete response letter would indicate that the FDA had completed its review. The FDA review of our NDA is continuing and ongoing, and the FDA wants to have an advisory committee in order to bring external expertise, clinical, scientific, and otherwise into their review so that they can complete their review.

So, it's a very different scenario to get an advisory committee compared to the complete response letter. I mean to address the specifics of your timing, yes, it's a little late in the game under – in the review process to get a request for an advisory committee, but the FDA is well within its rights and regulations to request an advisory committee at any time. And we're very willing and able to have this discussion in public and present our data, which as we alluded to before, we're quite confident in.

Geoffrey Porges

Mark, sorry, was this a change in the reviewing division though from the heme to a cardio-renal?

Mark Eisner

There was no change in the reviewing division. No.

Geoffrey Porges

Okay. Thank you.

Operator

Your next question comes from Annabel Samimy from Stifel.

Your line is open.

Annabel Samimy

Hi, thanks for taking my question. I promise I won't ask about the AdCom because it doesn't seem that you can answer many of them, but maybe we can talk about some of the signals that you're getting ex-U.S., obviously sales in China are going well. The mix of sales dialysis to non-dialysis is improving. Japan was approved the non-dialysis, even the French issued temporary use authorization with treatment up to 12 grams per deciliter.

So how should we read these signals abroad and how can that help you? And frankly help you with the FDA to move this process along. Can you draw from all of that information that has been generated globally? And given some of the movement that we're seeing in China, are you still assuming a $500 million opportunity in China or is that a moving target? Thanks.

Enrique Conterno

Yes, I think what we've said is that and we're very excited by the way with the way our China business continues to progress.

We have stated that we view the opportunity in China to be able to reach for roxadustat, to be able to reach peak sales north of $0.5 billion. It is pretty clear that the launch continues to go very well and we expect continued growth in China as we look at 2021.

So, we're very excited about that.

We are indeed we of course conduct pharmacovigilance activities in both China and Japan, where the product is launched. And we – as you mentioned, we need to make this also matter when it comes to the evidence that we basically have and how the acceptance and adoption and the utility that the patient basically has in the countries where we're launching.

So, I think this is an important factor of course.

Annabel Samimy

Okay, thanks.

Enrique Conterno

Operator?

Operator

Your next question comes from Jason Gerberry from Bank of America.

Your line is open.

Jason Gerberry

Hey guys thanks for taking my question.

Just from a timing perspective, just so as we think about potentially modeling the timing implications here.

So, it sounds like it's a moving target with at least a 55-day notice period will they let you know, in terms of timing from that to an AdCom? So, I would assume at least to be safe three to six months as a delay here. I’m not sure if you want to comment on the timing considerations. I realize it's been a very short amount of time since you've had to digest this information, but any analogs situations that you may have looked at or come in aware of as it pertains to a novel mechanism and anything that might give you or us sort of comfort as it pertains to this situation in general? Thanks.

Enrique Conterno

Yes, no, thank you very much Jason.

We are quite frankly, in unprecedented territory when it comes to having had an extension and then within the extension period now having an AdCom clearly not a good situation from a timing perspective. We don't question the possibility or the wisdom of having an AdCom, in fact we had very much shared that we were preparing for that back in the spring. But an AdCom was not called.

So now we find ourselves very late in the process. And at this point in time, we have to look forward to try to prepare in the best way possible to ensure that we can have the most successful AdCom possible. And sharing all of our data and why we have the confident that we have on roxadustat.

So, we will be looking of course at other types of examples and so forth and learning from that that's part of the AdCom preparation. I don't know Mark Eisner if you want to add anything to what I’ve said,

Mark Eisner

No, I think, you summarized it well, Enrique. I mean, we don't know the date of the AdCom yet, so it's difficult to speculate on exact timeframe. But we'll be preparing carefully, we'll be ready for the discussion and we actually welcome the input from nephrologists and the external medical and scientific community.

Just the timing is surprising.

Jason Gerberry

Sure.

Okay. Understood.

Michael Tung

Thanks so much.

Operator

Your next question comes from Yaron Werber from Cowen.

Your line is open.

Yaron Werber

Yes. Hey, thanks for taking my question.

So, Enrique I just have maybe a couple of questions. Number one, I was under the impression that the original NDA was sent to hematology.

So, is it that hematology ask cardiorenal for advice and the cardiorenal outcome was called just so we – it sounds like they didn't send the application across different division, but it sounds like they're calling an AdCom from another division and not totally surprising given that division has experienced at least with ESAs? And then secondly, as you think about OpEx for this year, I know you don't give guidance, but can you give us a little bit of a sense what's going on with IPF is a little slow because of COVID, but just a little bit, how do we think about OpEx? Thank you.

Pat Cotroneo

So yes, your understanding is also the understanding that I had on both hematology and renal. They are both under the same overall leadership at FDA. But we were informed today that CardioRenal will be the one basically conducting the AdCom or hosting the AdCom.

Sorry, I missed the second part of your question was related to COVID, were you asking about operating expenses?

Yaron Werber

Exactly.

Just some of the R&D would have been IPF-related, but that's slower to ramp.

So just, how do we think about the OpEx for the year overall and maybe a little bit of R&D? Thank you.

Pat Cotroneo

Yes, we of course are looking at our operating expenses. We do this as a matter of discipline. Whenever we had, even the three-month extension, I asked for an overall review of our operating expenses given that we were going to be launching roxadustat later.

Now we need to undergo a similar process now that we have a further delay.

So clearly when it comes to pam, we're trying to enroll as quickly as we can, but we need to be thoughtful about every single expense here at FibroGen. We do have a good balance sheet and a good position, but we need to make sure that it's invested in the things that can add the most value at all times, and continue to have operating discipline anytime as some of the assumptions change.

Yaron Werber

Great. Thank you so much.

Operator

Your next question comes from Andy Hsieh from William Blair.

Your line is open.

Andy Hsieh

Great. Thanks for taking my question.

So, I'm just wondering, high level, heading into the AdCom, what's your confidence level, right? So basically, before it's kind of a two-party interaction between you and the FDA, renal-cardio divisions. And now they're bringing in a third party, external experts, kind of democratizing the process.

So maybe comment on the confidence level and the ability for you to kind of highlight the data in that avenue. And also, for the preparation for incident dialysis, is that kind of a separate population that you would want to kind of single out during the presentation?

Pat Cotroneo

Yes clearly, I won't be sharing, what are we planning to present and so forth, but you can imagine, of course, the data that we have an incident dialysis, we believe is some of our strongest data.

As we think about MACE and MACE splash significance in that population.

So clearly very, very important data. What I would share, I think, you talked about democratizing the process. Yes, transparency, but I think it's also a good opportunity to get the external community, including nephrologists, patient advocates to opine about some of the needs out there. And honestly, I think in that way, I think, that the outcome could be refreshing to be able to hear some of the interests that the clinical community has on the product. That's what we hear, basically, whether it's at ASN either directly shared comments, but also how interested people are in the different presentations that we had, whether they were oral presentations or posters at ASN.

So, I look forward to the full engagement of the scientific community.

So that's the perspective that I would provide.

Andy Hsieh

Okay. Thank you. That's helpful.

Operator

Your next question comes from Paul Choi from Goldman, Sachs.

Your line is open.

Unidentified Analyst

Hi, this is Lisa on for Paul. Thanks for taking the question. A quick one on the AdCom for us. It seems that previously the FDA was reviewing roxa in terms of both the DD and NDD populations together.

With the new news on the AdCom, are you guys still expecting a similar review? Do you have any indication that the agency might review these populations and/or indications more separately? How you are thinking about that would be great. Thank you.

Enrique Conterno

Yes, I will have Mark Eisner maybe comment and respond to that question.

Mark Eisner

Yes, so it's a great question. Thank you. We can't really obviously share the details of the FDA's overall intent because we don't want to speculate, but we're very confident in our data for both populations. I mean, the data are the same today as they were yesterday. And we had the FDA tell us today about the AdCom.

So, we continue to feel very confident in the data. And as Enrique said, I think, it's actually, although the timing is unfortunate, it's a great opportunity to really hear from the community, whether they be patients and their advocates, nephrologists, other clinicians about how important and innovative this product is and can be for patients. And there has been very little innovation in this space over the past 30 years for CKD anemia, and we really believe that roxadustat can provide really significant clinical benefit to patients in both populations.

So, we're looking forward to that discussion in the public venue.

Unidentified Analyst

Got it. Thank you.

Operator

Your next question comes from Difei Yang from Mizuho Securities.

Your line is open.

Difei Yang

Hi, good afternoon. And thanks for taking the questions.

So just three quick questions. One, I apologize if I missed that. Will you be – are you expecting the 55-day prep time leading up to AdCom or will it be shortened in some fashion? Then the second question is that, would you have the option to call back CMO for this AdCom or do you think she will not be there Then the third question is with regards to EMA, I think, you had said you are still expecting decision mid-year 2021. I'm wondering if you are able to give us a little bit more detail between now and approval, what other things needs to happen.

Enrique Conterno

Yes. I'm going to have Mark Eisner respond to these questions. And I'll compliment his answers.

Mark Eisner

Right, so in terms of your first question, about the 55-day prep time, the FDA has not provided us a date for the advisory committee. And as soon as they do, we'll be able to communicate that, that we would assume that they are going to conform to their typical practices.

In terms of calling back CMO, Dr. Peony will continue to be working as a consultant for us for the next six months.

So, we'll have access to her expertise. And remember the expertise on this product, although Dr. Yu is very expert, is deep and broad within both FibroGen and AstraZeneca.

So, we're very confident that we will be able to bring a very appropriate and invigorated discussion at the time of the AdCom. And then in terms of the EMA, there has been no change to our expectations around the mid-year approval or for Roxadustat in the European Union.

Michael Tung

Operator?

Operator

All right, at this time I would like to turn it back to the speakers for further comments. I'm showing no further questions at this time. Please go ahead.

Enrique Conterno

We appreciate everyone's participation in today's investor call and your insert in FibroGen. Please follow-up with our Investor Relations team if you have any questions, we have not addressed on the call. And enjoy the rest of your day. Thank you.

Operator

Ladies and gentlemen, this concludes today's conference call. Thank you for participating.

You may now disconnect.