Albireo Pharma, Inc.

Good morning and welcome to the Albarrio Pharma second quarter 2021 earnings call. At this time, all participants are in a listen-only mode. A question and answer session will follow the formal presentation. If anyone should require operator assistance during the call, please press star zero on your telephone keypad. Please note that this conference is being recorded. I will now turn the call over to your host, Paul Arndt, Managing Director of LifeSci Advisors. Thank you. You may begin.

Thank you, Operator, and good morning, everyone. Thank you for joining today's call. This morning, Albareo issued a press release highlighting its recent business accomplishments and reporting its financial results for the second quarter ended June 30, 2021. This press release is accessible via the company's website at www.albareopharma.com. Before proceeding, we would like to note that management's comments today may include forward-looking statements regarding the company's plans and expectations. These statements are being made under the Private Securities Litigation Reform Act of 1995, and they are subject to various risks and uncertainties. Actual results may differ materially due to various important factors, including those described in the risk factors section of our most recent Form 10-K and our subsequent SEC filings. These filings can be accessed from the Media and Investors section of our website at www.alboreofarma.com or on the SEC's website. Any forward-looking statements represent our views as of today, Thursday, October 5, 2021, and should not be relied upon as representing our views as of any subsequent dates. We undertake no obligation to publicly update these statements. Now, it is my pleasure to turn the call over to Ron Cooper, Alvarez President and Chief Executive Officer. Ron?

Great. Thank you, Paul, and thank you, everybody, for joining us this morning. With me today are Simon Harford, our Chief Financial Officer, Pamela Stevenson, our Chief Commercial Officer, and Dr. Christine Clemson, Vice President and Head of Medical Affairs, who's sitting in today for Dr. Pat Horn, who's on a well-deserved vacation this week. We're very pleased to provide an update and an overview of our recent events. It's only been a couple of weeks since we announced the unprecedented back-to-back U.S. and European approvals for Bilvay, as well as our receipt of a priority review voucher. It's exciting to begin the journey to bring Bilvay to the approximately 100,000 pediatric cholestatic patients around the world. Since receiving approvals, we've accomplished a great deal. we're hearing from physicians about how pleased that they are now able to treat children with a medical therapy versus putting them through invasive surgeries. For example, we've heard from a physician who put a child on Belvay who prior to treatment had serum bile acids of 700 micromoles per liter. After only one week, the physician reported a reduction to 100 micromoles per liter. as well as a dramatic reduction in the child's pruritus. We want to extend this type of benefit to as many patients as possible. With Bilve, we have a competitive profile. An oral, once-daily, non-systemic medicine with a favorable safety profile, a low diarrhea rate of 9.5% versus 5% placebo, demonstrated positive effects on growth, and the only approved drug to treat pruritus in PFIC patients across all subtypes. So are we reaching patients? The answer is yes. We're off to a fast start, and the integrated launch system is working. The field teams are meeting with HCPs and payers. Prescriptions are being generated. We are successfully working through patient cases through Alvareo Assist, and we have commercial drug ready to put in the hands of PFIC patients. It's only the first two weeks since approval, but we're pleased to see the integrated system working all the way from manufacturing to the ability to fulfill prescriptions. So starting with manufacturing, supply, and distribution. Following our product approvals, final goods have been packaged, we ship to the distributors, and the three specialty pharmacies have stock. So the good news is we're getting Bilvay where it needs to go and at the right time. So then we focus on getting bilby to the available patients. We estimate that the global PFIC prevalent population is 15,000 children, excluding China and India. We define prevalent as anybody who has the disease and is alive. Our estimate for available patients is about 2,500 globally. These are patients who are ready to be treated. This is a huge advantage for us versus other rare disease categories where you have to work through diagnosis and then find patients who could take years to be diagnosed. But in this disease category, the patients have symptoms and are in the system, ranging from the newly diagnosed to those slated for potential transplant. Our team's job is to reach the identified patients, and we're working quickly with our specialized field teams to do that. From a physician outreach standpoint, the Alvareo and Travere teams are deployed and have hit the ground running. We've already reached over 80% of the top 60 centers. Our first patients are enrolled in Alvareo Assist, and the care coordinators are working through reimbursement cases to ensure access to Bilvay. Over the last two years, Alvareo has been working to ensure prescribed patients gain coverage for Bilvay, but it's important that we now lock in coverage and reimbursement. With BILVE, we have a clear benefit of the medicine defined with the strength of data, value proposition, evidence from the natural history study, and caregiver burden study. BILVE is a weight-based oral medicine priced at $385,000 per patient per year, based on an average weight of 18 kilograms. The 40 and 120 microgram per kilogram capsules are priced linearly, and the prices for the individual bottles have not been listed in Compendia. To date, we have meetings either completed or scheduled with payers who cover 95% of patients' lives. So clearly, we're focused on ensuring both commercial and public coverage with Medicaid. We know that many insurers, Medicaid included, are working on medical eligibility criteria for prior authorizations. Because of this, we expect the first patient will take a little more time to process, but we're confident in our ability to work through these cases through Alvareo Assist. Medicaid's a good example. With the late July FDA approval, we were able to submit our Medicaid National Drug Rebate Agreement to CMS by the quarterly August 1st deadlines. This means that state Medicaid agencies have the options to start covering BILVE, and many will do so immediately, with all states required to cover by October 1. After that, it will be much easier for new patients to flow through the system. Overall, we're pleased with the payoff response and feel that the early days of BILVE availability in the U.S. are going well. We're pleased to have two approvals in a week, which most companies experience in a matter of months instead. Therefore, our timelines and launches are compressed, but in a positive way. Why is this significant? We know based on other rare disease analogs, ex-U.S. revenue can account for more than 50% of the global revenue. So we're driving as hard in Europe and the rest of the world as we are in the U.S., Therefore, once we received marketing authorizations in Europe, we began our launch activities first in Germany with price listing planned for September. Simultaneously, we're working on the remaining European markets, having submitted many reimbursement dossiers. In the rest of the world, we continue to add commercial distributorships in regions and countries with high patient prevalence. Now, in parallel, the European authorization allowed us to initiate a global managed access program that will enable access to patients through a variety of routes, including named patient programs. As we make progress on the initial commercial launch, we are convinced now more than ever of the opportunity in PFIC. Bilve fulfills a clear need in the market for a better treatment option for patients. And given our already proven ability to execute, we have full confidence in our team to carry out our launch plan successfully. At the same time, we continue to execute on our two phase three bilve clinical styles. Both the positive data from the PETFix study as well as US and EU approvals are a shot in the arm to our teams, increasing the already high level of confidence in bilve given the high level translatability of the data to biliary atresia and allogeal syndrome. For the bold phase three pivotal study of bilve and biliary atresia, we have made tremendous progress. Biliary atresia is the most common pediatric cholestatic liver disease. BOLD is the only pivotal, double-blind, randomized, placebo-controlled study, and we've agreed with both the FDA and the EMA that this single trial will be sufficient for approval with a positive outcome. BOLD remains on track for top-line data in 2024. The ASSERT study is a Phase III pivotal study of Bilbane Allergy Syndrome. This study is also a double-blind, randomized placebo-controlled study, which we have also agreed with both the FDA and EMA that this single trial will be sufficient for approval with a positive outcome. Assert remains on track for top-line data in 2022. We will continue to drive enrollment for both of these studies, which is key for Alvareo as we look at our aspiration of delivering billion in revenue in the second half of the decade with expanded indications across three cholestatic liver diseases. We estimate that there are 100,000 cholestatic liver disease patients globally, and PFIC is only the start as we work to make BILVE available to patients with biliary atresia and allogel syndrome. The completion of these programs is important, and we're optimistic based on the very positive results from the PETFIC study. Now rounding out our development portfolio is our two adult liver disease product candidates, A3907 and A2342. A3907 is our oral systemic ASBT inhibitor, which is the first ASBT inhibitor to have high bioavailability and a significant systemic exposure. The phase one trial of A3907 is proceeding as planned, and we anticipate sharing data later this year. In June, we presented early clinical data of easel that confirmed A3-nano7's effectiveness in cholestatic liver disease with potential in PSC and PBC. We have a high level of confidence in our new bile acid modulation technology and ability to provide new options for these patients. Our second product candidate is A2342. the first potent oral NTCP inhibitor being developed for viral and cholestatic liver diseases. We're generating important modeling data and completing IND-enabling studies with the intent to move into the clinic with a phase one study in 2022. So in summary, we're excited to be up and going. with the launch of BILVE and starting our journey to provide a better treatment option for the estimated 100,000 pediatric liver disease patients in the world. We've already started and our teams are working diligently on outreach to educate physicians while providing patient benefit support for families with Alpareo Assist. Beyond PFIC, we have tremendous opportunities with our ongoing clinical programs. We're a company with a first-in-class product with other strong candidates in the pipeline and look forward to a milestone-rich period, starting with continued progress and updates on our commercial launch of BILVE, continued execution in the BOLD and the CERT trials to realize our $1 billion aspiration for BILVE, with the expansion to biliary atresia and allogel syndrome, our continued progress in our adult liver and viral disease compounds, A3907, A2342, and the planned monetization of the priority review voucher, which are currently worth about $100 million. We are at an exciting and meaningful period for Albarrio where we are seeing our strategic vision come to life as we bring BILVI to children with PFIC and look forward to the prospect of broadening our impact as we work to bring therapeutic relief to patients with other cholestatic and viral liver diseases. So with that, it's my pleasure to turn the call over to Simon for a financial update. Simon?