Ardelyx, Inc.

Good day, and welcome to the Artelix First Quarter 2024 Earnings Call. All participants will be in listen-only mode. Should you need assistance, please signal a conference specialist by pressing the star key followed by zero. After today's presentation, there will be an opportunity to ask questions. Please note, this event is being recorded. I would now like to turn the conference over to Caitlin Lowey, Vice President of Corporate Communications and Investor Relations at Artelix. Please go ahead.

Thank you. Good afternoon and welcome to our first quarter 2024 financial results call. During this call, we will refer to the press release issued earlier today, which is available on the investor section of the company's website at ardellis.com. During this call, we will be making forward-looking statements that are subject to risks and uncertainties. Our actual results may differ materially from those described. We encourage you to review the risk factors and our most recent quarterly report on Form 10-Q that was filed today and can be found on our website at ardellis.com. While we may elect to update these forward-looking statements in the future, we specifically disclaim any obligation to do so, even if our views change. Our President and CEO, Mike Robb, will begin today's call with opening remarks and an overview of the company's progress during the first quarter of 2024. Next, Susan Rodriguez, Chief Commercial Officer, will provide an update on the performance of Insurella and Exposa. Justin Renz, Chief Financial and Operations Officer, will conclude today's prepared remarks with a review of the company's financial performance during the first quarter ended March 31, 2024, before we open the call to questions. With that, let me pass the call over to Mike.

Good afternoon, everyone, and thank you for joining us on this call. Q1 earnings always seem to come quickly after we report our Q4 results, and yet, as usual, a lot has happened since we last provided you an update. First, Xposed's performance out of the gate following the launch in November continues at a remarkable pace. This is a first-in-class product in a therapeutic area that has seen no innovation in decades. The response from the prescribing community clearly demonstrates the significant unmet need among this patient population. EXPOSA is an important new option for physicians to help patients whose serum phosphorus remains elevated despite best efforts. All demand indicators are favorable. Prescribers are eager to learn more about EXPOSA's blocking mechanism and are working to identify potential candidates for therapy. Like Azarella, our deluxe assist is supporting prior authorizations and helping patients take advantage of our affordability programs. Patients are accessing the drug, and the feedback is that patients are seeing sustained reductions in their serum phosphorus. We are focused on ensuring prescribers are aware and educated on Exposa and ensuring patients have access to treatment. As you can see by our performance, it's going very well. Izrella continues to perform strongly, providing an important option to, again, address a large unmet need among IBSU patients. We believe that this can be a billion-dollar product, and on the path to achieving that peak, we expect full-year net sales revenue for 2024 to be between $140 and $150 million. As I consider the first quarter performance, the underlying demand metrics and fundamentals of the business are robust and continue to demonstrate growth in new and repeat writers and new and refill prescriptions. Our reported revenue reflects demand growth, offset by the impact of seasonality, which is standard across the industry that we experienced during this first quarter. Importantly, our cash position remains strong, resulting from our revenue, the third tranche of debt from our partnership with SLR, and thoughtful management of our expenses. We are at an exciting time in our evolution as a company, and our top priority is to build upon the growth momentum of Insurella and Exposa. Now, I will turn the call over to Susan to discuss first quarter performance for both of our products. Susan?

Thank you, Mike. It is great to be here today to discuss the commercial performance for Ipsrella and Ixposa. Our performance reflects strong execution of our disruptive commercial approach for both first-in-class products, which centers on targeting the high-volume writers in our disease areas, driving identification of patients in need of a novel treatment option as their response to existing treatment options is deemed to be inadequate, and enabling patient access and affordability with favorable coverage policies that define the path to access, prior authorization support, and patient support programs. Let me begin with Ibsrella. Our confidence in this product is driven by the strength of the fundamentals driving Ibsrella's performance. HCPs are evolving their treatment practice now that they have expanded treatment options for their IBSC patients following the launch of Ibsrella. Based on the favorable clinical response they are seeing and confidence in the path to access, HCPs are increasingly identifying patients in need of a novel treatment option. During the first quarter, we saw increases across all key demand parameters for the product, including growth in new writers and repeat writers, as well as growth in new prescriptions and refill prescriptions. We are very encouraged by the continued growth of these key demand metrics despite Ibsrella being impacted by first quarter seasonality that is commonly seen across the industry linked to insurance plan resets and prior authorization renewal processes. During the first quarter, we began the process to expand the Ibsrella dedicated Salesforce footprint from 64 territories to 124 territories. We experienced a strong response to the job postings, attracting sales talent with extensive GI experience who are motivated and enthusiastic to join the Absrella sales team and be part of disrupting the IVSC market with an innovative therapy. Hiring, training, and full deployment of this team is on track to be completed by the end of the second quarter. This Salesforce footprint puts us in a strong position to capitalize on the promotion sensitivity we have seen across our high-riding HCP targets to further drive increases in new riders, as well as drive expanded use across our growing rider base, who are continuously broadening their view of patients who are candidates for Exrella. The fundamental drivers behind Azrella are strong, and we anticipate continued quarter-over-quarter growth with our expectations for the 2024 performance consistent with our stated guidance. Turning to Exposa, we are extremely pleased with the nephrology community's response to this first-in-class phosphate absorption inhibitor. It is clear that patients have been in need of a new option to manage their phosphorus when binders were insufficient or not well tolerated. Our dedicated nephrology sales team, comprehensive blocking messaging campaign, speaker and promotional programs, and omni-channel initiatives are driving high interest and early uptake of Exposa. Nephrologists are responding favorably to the novel blocking mechanism and clinical data profile, are pleased with their early clinical experience, encouraged by the defined coverage policies, and increasingly integrating this novel blocking mechanism product into the therapeutic regimen for their patients. The feedback we regularly receive from the field is that physicians are seeing that their exposure-treated patients, many of whom have been continuously outside of target ranges, are reflecting consistent improvement in serum phosphorus levels and that these levels are being maintained. We are also hearing that patients are responding favorably to the dosing profile and that HCPs are pleased with the flexibility they have in adapting the patient's treatment regimen where they can add Exposa to the patient's existing binder regimen or they can add Exposa and reduce the patient's binder regimen or they can add Exposa and fully discontinue the patient's binder regimen. HCPs are adopting EXPOSA and are adapting regimens based on the needs of the patients. We are very pleased with the $15.2 million in sales we reported for EXPOSA during the first quarter. This performance is consistent with the uptake indicators we are seeing in the field. Our sales force is experiencing highly engaged, meaningful discussions with our target HCPs who are eager to learn about EXPOSA. Nephrology HCPs are rapidly identifying patients who they believe can benefit from therapy, reporting to us that they may have many patients outside of target ranges despite treatment with binders or are intolerant of binder therapy. HCPs are pleased with the clinical response they are seeing and patients are responding favorably to the treatment experience. Coverage policies are being defined that outline a path to access via prior authorization attesting to the fact that the patient has been treated with binders and inadequately responding or unable to tolerate the therapy. HCPs are seeing that when prior authorizations are submitted for patients meeting the criteria, patients are gaining access to Exposa. Nephrology HCPs and their office staff are responding favorably to our specialty pharmacy distribution network, as well as to our comprehensive patient services offering, our Delix Assist, that further enable patient access through prior authorization support and patient engagement with the affordability programs available to them. Our own internal metrics are supported by external research conducted by Spirix, who's tracking the launch of Exposa. According to the April 2024 Launch Dynamics Report, nearly all of the 77 surveyed nephrologists, 98%, rate Exposa as an advance over currently available hyperphosphatemia therapies. In addition, 56% of the surveyed nephrologists reported using Exposa, and of those, again, 98% report satisfaction with treatment. The research demonstrates that awareness is high among the nephrology community, interest and intent to adopt is high, and satisfaction with the treatment is high among users. We will continue to build upon our launch momentum, capitalizing on the high nephrology awareness of the number of patients that are in need of a new treatment option, despite treatment with binders, and their intent to adopt Exposa for these patients. Our go-to-market strategy is working. We have established a strong presence in nephrology offices across the country, and HCPs are responding favorably to the novel blocking mechanism and clinical data profile. They are identifying patients that could benefit from Exposa therapy And with coverage policies in place, patients are gaining access and responding favorably to treatment. We are pleased with the performance thus far and are focused on continuing this growth momentum. We have several exciting months ahead as we will have a strong commercial and clinical presence across key annual medical conferences for both Avdrella and Exposa, where we will have the opportunity to present more clinical trial data on our products, connect with the prescribing community, and deepen our relationship with patients. I look forward to continuing to share updates with you in the future. With that, I will hand it to Justin.

Thank you, Susan. I'm very pleased to be with you today to discuss the first quarter performance we reported, which included meaningful progress towards our Absrella net sales revenue guidance, a strong launch of Exposa, careful management of our finances, and a strong cash position. Let's start with revenue. As you saw in this afternoon's release, we reported significant year-over-year growth, bringing our total first quarter product-related revenue to $45.6 million, compared to $11.4 million in the first quarter of 2023. Net product sales revenue for Absrella was $28.4 million during the first quarter of 2024, more than doubling the $11.4 million in revenue we reported during the same period in 2023, and a 1% quarter-over-quarter growth compared to the fourth quarter of last year. Volume demand grew for Absrella during the first quarter, which was offset by deductions associated with the reset of annual prescription drug plans. Most notably, this was related to our commercial copay program. The impact of the commercial copay program is most significant in the first quarter when most commercial health care plans reset and patients have higher out-of-pocket requirements. As patients fill prescriptions throughout the year and begin meeting their deductible requirements, our expenses related to the commercial copay program decline. Our gross-to-net deduction for Absrella during the first quarter was in line with our expectations at 33.5% and comparable to the 33.7% we saw in the first quarter of 2023. We expect this percentage to improve as the year progresses as it did last year. In addition, we saw the anticipated impact of the prior authorization renewal process that occurs at the start of the calendar year for many healthcare plans. The strong demand and expected improvement in gross net deductions reinforced our confidence in the ongoing performance of Adrella. As such, we continue to expect that full-year U.S. Adrella net product sales revenue will be between $140 and $150 million. Xposa had an exceptional first full quarter performance, as we are reporting $15.2 million in net sales revenue driven by the meaningful demand for this product. Our gross to net deduction cave in favorably for Exposa at 23.8%. As we progress into the launch of Exposa and learn more about the patient mix that drives the associated gross to net deduction, we will share more. In addition, we had $2.5 million in combined licensing and product supply revenue. We are very pleased with our top line results during the quarter, which demonstrated the growth momentum Mike and Susan both spoke to. At the same time, we continue to be thoughtful in how we manage our expenses. Research and development expenses were $10.6 million compared to $9.1 million during the first quarter of 2023. Selling general administrative expenses were $53 million for the first quarter compared to $26.8 million for the same period of 2023. The increase was related to launch activities for EXPOSA, as well as continued investments to grow IBSRELA, which we made throughout last year. Importantly, our costs were comparable to our spending in the fourth quarter of 2023. We expect to complete the current expansion of the IBSRELA sales force that Susan previously mentioned by the end of the second quarter. Substantial top line growth combined with thoughtful cost management resulted in a net loss of approximately $26.5 million or 11 cents per share in the first quarter of 2024 compared to a net loss of $26.8 million or 13 cents per share in the same period of 2023. The net loss for the first quarter of 2024 included $9.3 million in combined non-cash expenses from share-based compensation and non-cash interest expense related to the sale of future royalties. As of March 31, 2024, we had total cash, cash equivalents, and short-term investments of $202.6 million, as compared to $184.3 million at the end of 2023. This includes $49.8 million in net proceeds that we drew in March from our Term 1 agreement with SLR Capital. We are very pleased with our performance during the first quarter, driving top line growth across all reported revenue lines, planning for success, investing in our supply chain, managing our operating expenses, and strengthening our cash position. We will continue to be thoughtful with how we deploy capital while focusing on maximizing shareholder value. With that, I'll turn it back to Mike.

Thanks, Justin. I hope that what you took away from our performance during the first quarter is that, one, we continue to have high expectations for Azrella, including $140 to $150 million in net sales revenue this year and on the path to at least 10% market share and $1 billion in annual revenue. Two, Xposed's launch progress is exceptional, and it is already beginning to disrupt the hyperphosphatemia market, where there remain significant unmet needs among patients. And finally, we are in a strong cash position to invest in growth. We have a lot of important work ahead of us, and we have the team in place who is able to deliver. I look forward to sharing our progress with you over the coming quarters, and I will now open the call to questions. Operator?

Thank you. We will now begin the question and answer session. To ask a question, you may press star then 1 on your touchtone phone. If you are using a speakerphone, please pick up your handset before pressing the keys. To withdraw your question, please press star then 2. Please limit yourself to one question and one follow-up. At this time, we will pause momentarily to assemble our roster. The first question comes from Chris Raymond with Piper Sandler. Please go ahead.

Hey, thanks, and congrats on the great success here with Xposa. Just maybe one question on that and a follow-up as well. I know you guys are early in the launch, and you've already established sort of a cadence here for guidance after having a number of quarters that you've set with Absrella, but But the magnitude of the speed is obviously more than anybody expected. Can you provide maybe any sort of color here? I think everybody sees the script data, and if folks were following that, they're even surprised. Those who've been following the script data closely are surprised by the number. Any sort of color in terms of the uptake and what we should be thinking in terms of the implications for the next several quarters, a couple quarters anyway? And then maybe the follow-up is, I know, Mike, you're not in the business of predicting legislation, but in the absence of sort of any progress in terms of pushing the phosphate binders into the bundle, pushing that off, at what point do you start maybe planning for that as a reality? Thanks.

Yeah, so Chris, thank you for the questions. I guess first of all, I hope by now you can tell that we're not quitters and that we see what we're doing for patients and the uptake that we see with Exposa is it has been absolutely worth the fight that we're fighting. I think as you see with what we've done with Estrella, these IVFC patients as well deserve the attention that we're giving them. What you saw with Azarella is we need and we expect to have roughly four quarters under our belts before we give guidance. We don't want to get over our skis. We're excited and thrilled by this performance. The anticipation for the drug out there, the enthusiasm our AVDs are seeing in the field is remarkable. The ability that we have in helping people through the prior authorization process through our dollars assist is working extraordinarily well based on so many of the learnings that we got through with Adrella. So although I would like to give you a clear answer on both of those, I'm sorry. I'm sure you understand that I can't. Got it.

Thanks.

Thank you for trying. The next question comes from Yigal with Citi. Please go ahead.

Oh, great. Hi Mike and Susan and Justin team. Thank you so much and congrats as well on a very strong launch. Susan, I just had a few questions on the commercial franchise. Regarding Ibsrella, can you comment the percent that were new writers versus repeat writers in the quarter? And then with the almost doubling in the territories, How do you expect that to scale in terms of the size of the base of the prescribing physician community? And then with Exposa, you nicely articulated three buckets, the ones where you add Exposa and get them to goal, and ones where you can add and then reduce the binder and then even add Exposa and potentially remove the binder altogether. Do you have any anecdotal or early evidence or data to discuss sort of roughly what percent fall into each of those three scenarios. Thank you.

Thanks, Egal. Thanks for the question. In terms of the new and repeat writing, we have not disclosed the specifics in terms of those percentages. But what I can tell you that's a really important metric to track is just the persistence of new writers being generated weekly, monthly, quarterly. And what we're seeing since launch is that this has been persistent with new writers being generated constantly on a weekly, monthly, and quarterly basis. So seeing that persist really gives us great confidence in the momentum and our guidance for this year. In terms of repeat writing, what's important to note there is that now that we're several quarters into launch, we have the data to show that new writers write again. So we're seeing that repeat writing is also persistent. where the growth opportunity is, is in continuing to drive that new writer growth, but then also amongst that growing writer base, really growing depth of writing. So these repeat writers could write more often and for more patients. And what our sales force is executing on is really driving that broader view based on the foundation of positive experience they've had to date of patients that now really need to be considered as candidates for Absrella, because they do have persistent symptoms, have been tried on other things, and now physicians have seen that there is a path to access and that patients are responding well. So they're broadening their view on potential candidates, and that's really an important growth opportunity for us as well. In terms of the Salesforce impact, that's exactly why we believed it was critical to continue to invest in our Salesforce footprint, because our experience to date shows that the space is quite promotion sensitive. So the more we call on doctors, the more they write Ibsrella. We see that relationship. The more they engage in all of our omni-channel initiatives and in our programs, the more Ibsrella they write. So expanding our footprint from 64 to 124 really gives us an opportunity to get into those HCP offices more frequently to continue to drive that expanded writing and really capitalizing on the fact that they are broadening their view on patients who are candidates for Exposa, and at the same time can also continue to penetrate our target space and generate new writers. So really being able to execute, you know, to achieve both.

Okay, great. And then if you could comment on the Exposa question, if you have any data there regarding the way it's bucketing, reducing the binder versus removing it.

Yeah, not specifically from a percentage standpoint, but what we're hearing persistently is that all nephrologists, you know, in general, nephrologists are just commenting on the flexibility And that's what's really exciting because that means that that patient group that they identify that they believe is inadequately managed on binders or don't tolerate binders, they see Exposa because of its complementary MOA blocking mechanism of action as a drug that that patient could benefit from. And they don't have an ingoing concern around how it gets integrated because they can be flexible on initiating therapy and then Some of them are initiating, tracking, and then taking them off, you know, some of the binders. Some of them just cut the binders right away. Some of the time they just eliminate it entirely, as I mentioned in my narrative. So what we hear more is that each doctor is actually using the drug with this level of flexibility and that they see that as a way to really be able to realize the benefits of novel mechanism exposure across their patients that they see are inadequately managed.

Just one additional comment with that is, I think, as we spoke of earlier in other calls, is you never had multiple mechanisms like you do with so many other diseases to manage what the drugs are trying to address. So it's not going to be a static ratio in any given patient. There's going to be an inter and intrapatient variability depending upon their serum phosphorus. There's now flexibility and tools for these physicians to finally get phosphorus in the target range that they're looking for. So I think that's going to evolve, and as we understand that better in the coming quarters, we'll certainly share it.

Great. Thank you very much.

The next question comes from Louise Chen with Cantor. Please go ahead.

Hi. Congratulations on all the progress this quarter, and thank you for taking my questions here. First question I wanted to ask you about was Xposa and the $15.2 million. Is that all demand sales or is there any stocking in there? And secondly, just back on this Buddy Carter bill, if it doesn't move through, then is that $1 billion of peak sales you have for IBS Rella at risk or that is regardless of whether or not Buddy Carter happens? Thank you.

Yeah, I mean, there are two different product lines and different patient populations. So our guidance with Israel is independent of that. But thanks for asking that as it relates to stocking. Let me ask Justin to address that.

Thank you, Louise. It has been really a just-in-time, if you will, approach with Exposys. So, through our network, we've seen very low inventory rates since launch in November. So, I would say it is absolute demand of the patients and not at all any stocking. Very limited to roughly between one and two weeks at max in the channel.

The next question comes from Ryan Deschner with Raymond James.

Please go ahead.

Hi, this is Ryan Deschner. Congrats on the strong early exposure launch. Two good questions for me. At this point, I was wondering what the breakdown is looking like so far between patients getting access to exposure through Medicare versus non-Medicare, and then comparing the How much of Xfoso's strengths are you attributing to differences in market dynamics versus differences in your commercialization strategy? In other words, is your commercialization strategy for Xfoso Marketly different from that of the early Absrella launch, or is the main driver more related to differences in things like unmet need, patient exit rate, etc.? ?

Yeah, Ryan, thank you for the question. The easy answer is, of course, it's our very, very unique and disruptive commercialization approach. No kidding. I think what we do here, and Susan can address it in greater detail, it truly is one about having really good drugs that are making a difference for these patients. having a commercial team that knows how to communicate that from the omni-channel initiatives and a remarkable sales team with feet on the ground talking to physicians about what these drugs can do for their patients because these drugs work. Susan?

Yeah, so I would say exactly to Mike's point, our go-to-market strategy, actually there are really – very important parallels between Azrella and Exposa in the novel MOA, in the fact that there's limited options, and the fact that there's patients in need of novel options. So where I see, what's an important distinction is that for exposure, we went into the market with a very, very ingoing high level of awareness of exposure across the nephrology target base and high interest and intent to adopt and high level of awareness on the range of, you know, the patients that they see that they have challenges in managing serum phosphorous. on binder therapy. So I think there was a higher level of market awareness about both the product and the unmet need. Whereas with Ipsrella, while it's a parallel situation where patients have limited options and are inadequately managed and in need of a novel option, in our go-to-market approach, it's really our promotion and our education on our target base that really got them to begin to identify, wow, yeah, patients are inadequately managed. We never had another option. Now that we have another option, We're increasingly identifying these patients. We're actually engaging in dialogue with these patients. And now we're expanding the way we treat and using Ibsrella for those patients and adequately manage. So there was a little bit more market need education required on the Ibsrella side. And those would be the only differences. Path to access is the same. And the coverage policies as they're being defined have also been favorable on both sides.

Got it. And then on the Medicare versus non-Medicare breakdown for the first quarter. Yes, Susan?

Yes. Yes. Thank you, Mike. Yes. So, right now, it's actually really interesting being on the market now for a full quarter that we can see from our IQVIA data what the percent mix is for the EXPOSA prescriptions. And on average, between 55 and 60% is Medicare, and the remainder is non-Medicare.

Got it. Thank you very much. Thanks, Ryan.

The next question comes from Dennis Ding with Jefferies. Please go ahead.

Hey, guys. Congrats on the solid quarter. A few questions for me, if I may. On gross per net for EXPOSA, this was definitely better than what people expected in the first quarter. So how does this evolve through the year, and we should use the 23-8 as the new base going forward. And then secondly, I want to take another stab at this question, but on HR 5074, if the bill is to be signed into law in the first half of 25, EXPOSA would need to go into Tdapa, but then if the bill gets signed, EXPOSA would need to come back out of Tdapa. Can you perhaps shed some light on that process and some of the logistics surrounding that? Thank you.

Hey, Dennis. Yeah, let me just address that quickly. You know, currently, I think, as we've said, our intent is to enter DAPA. I think the specifics of what you're just describing, you know, that's going to play out over time. But, you know, our current intent is to go through the process. And as we hope in the work that we're doing and what Buddy Carter is doing and others on the Hill is understanding how important this medicine is for patients. This is good policy. This is the right thing to do to ensure the patients get access to a drug that's already beginning to make a difference in many, many lives of dialysis patients. So the work continues and the specifics about how things come in and out based upon these next six months or more, we'll get that to you as we also learn. And, Justin, if you can address the gross net.

Thanks, Mike. Yeah, Dennis, in the first quarter, exposures gross to net deduction was 23.8%. It obviously is very early in the launch and also the first quarter of the calendar year. So, as Susan articulated, our Medicare and non-Medicare split is around 55% to 60% Medicare and the rest non-Medicare. We're still learning the patient mix. This is going to drive the gross to net ratio for the course of the year. So, you know, as a reminder, like I said, it's our first full quarter. We're currently estimating that maybe it will slightly increase over the next few quarters, but in general, we believe for the rest of this year, it will be in the mid-20s range.

And we will obviously comment more closely if we have greater clarity. Got it.

The next question comes from Rowana Ruiz with Lee Rink Partners. Please go ahead.

Great. Afternoon, everyone. One for EXPOSA. Could you talk a bit about what the early adopter patients look like in terms of their main features and what's really encouraging physicians to find them and identify them as optimal candidates for EXPOSA?

Yeah, I'll ask Susan to address it, but the realities are they're not that hard to find when we know up to 80 patients are out of range and they've been waiting for something like this. So it isn't that you have to seek and find. It's you have to ask the question, do you have patients above? The answer is, of course, yes. And then we move forward. Susan, sorry, I took the...

Yeah, no, no, you're absolutely right. But I think, you know, in terms of, I appreciate your question on who are these early patients we're getting. And I think to Mike's point, first of all, important to know that these phosphorus levels are tracked very closely. So nephrologists have like an ongoing understanding of their patient base and where their phosphorus are. So what we're seeing in terms of the patients that are are being initiated on Exposa right away are those that the nephrologist had in mind that they know historically they've really had challenges in keeping them within target ranges. That's who we're getting now. And what's really important as we continue to execute is now that Exposa is available to really make sure that the nephrologist begins to adapt their behavior and turn to Exposa, you know, you know, when possible, looking at their patients that are outside of target ranges.

Got it. Thanks.

The next question comes from Laura Chico with Wedbush. Please go ahead.

Hey, guys. Good afternoon. Thanks very much for taking the questions. Just two from me. First on Adrella, what needs to happen to hit the high end of the guidance range now for patients 2024. And then I just wanted to follow up on Exposa, the conversation around the current Medicare-Medicaid mix. Is that where you're projecting at a steady state level? You remain kind of a roughly even split between Medicare and non-Medicare patients. And I'm just kind of thinking ahead. in terms of the revenue that might be more exposed to a SADAPA environment versus not. If you could just share any color in terms of where you see that payer-mix split ending up over time, that'd be helpful. Thank you.

Let me just briefly address the Israel question is, you know, it's execution and everything that we have been doing is what we need to continue doing. The expanded footprint certainly is going to be a benefit, as we said, trained and in the field by the end of the quarter. So that's certainly a big part of it, too. But it's execution. The patients are there, they're waiting. And when you ask the right questions, the physicians identify them and we help them go through the prioritization process. Susan, you want to address the So there's a question.

Yeah, sure. So I think just as anything regarding Exposa at this moment, only having one full quarter under our belt, it's hard to predict, Laura. You know, I don't want to give you the impression that this is exactly steady state. However, it is not unexpected when you just understanding the patient mix in the dialysis setting and the mix that we've seen even, you know, for in the Acuvia data for the binder therapies, This is not unexpected, but we need, you know, a few more quarters before we can tell you for certain. One thing that's important is just understanding that the coverage policies have been defined across all the payer segments. So, and I think that's really what's driving the ultimate outcome in terms of the profile. So, that is established and will be, you know, consistent as we move into this, you know, as we proceed through this quarter and going forward.

since we have nice coverage policies in place across all those segments.

Thanks very much. Thanks, Laura.

The next question comes from Joseph Thome with TD Cohen. Please go ahead.

Hi there. Good afternoon, and thank you for taking my question. Congrats on the strong launch. Maybe on Exposa, can you give us a little bit of an idea of the proportion of patients that are on free drug or using the patient assistance program as they await coverage? And maybe how long does it take to navigate that prior authorization process from a physician writing a script to actually getting the drug? And then second, Mike, you mentioned the cash balance. Maybe what's your appetite to invest in R&D either internally in the pipeline or maybe go externally and bring something in? Thanks.

Let me address both the first and the last question is, you know, it's early days for us to be sharing what's on the patient assistance program. So we're gonna wait until we've got more experience under our belts with that. And as you saw, just under a month and a half ago, we hired Mike Kelleher as our Executive Vice President of Corporate Development Strategy. That should be the signal to your question of our willingness to invest in pipeline opportunities, whether it's organic development or opportunities we may find outside, as I think what we are demonstrating is that the approach that we take to commercialization of drugs is clearly unique. Our ability to attract remarkable performers in the field I think is evidence of what you see in both ISRELA and exposure performance. So leveraging that and bringing Mike on board certainly is a big part of us going in that direction.

Great. Thanks.

The next question comes from Ed Arcee with H3 Rainrite. Please go ahead.

Hi, everyone. This is Thomas Yip asking a couple of questions for Ed. Congrats on the strong early traction and great exposure. Perhaps first question, can you discuss how many patients are on exposure therapy to date and among these patients? What's the split between GI, gastro, and then PCP prescribers? And then I have a follow-up question as well.

Yeah, it's a little bit hard to hear the question, but I think you're asking about the split of patients in GIs versus PCPs. You know, I think as Susan has spoken about our targets, it's high-writing GIs and high-writing ACPs who act as other GIs and have big practices. I don't know, Susan, if you want to add anything more to that.

Yeah, exactly. So we identify, you know, our target audience is 9,000 HCPs that account for 50% of the total IBSC indicated market. So even though so many doctors write IBSC scripts, the opportunity of really targeting this concentrated group that accounts for 50% is really what, you know, drives this umbrella opportunity for us. And as Mike mentioned, they, you know, what we find is that there really isn't a distinction between between a PCP and a GI. What we have is the high-writing GIs, and then we have high-writing non-GIs that actually, you know, behave like GIs and just decide to take an interest in treating IBSC and using the IBSC-indicated drugs to manage their patients. So it's really not a distinction that's relevant in our go-to-market approach.

Got it. And also, can you discuss how many patients are on explosive for 50 days and also the script data can be a reasonable indicator of underlying demand of growth?

I think you're asking how many people are on 60-day versus 30-day scripts. You know, I think, again, it's early days for us to be sharing that kind of information.

The next question comes from Matt Kaplan with Leidenberg Thalmann.

Please go ahead.

Hey, guys. Thanks for taking the question. And nice out-of-the-gate launch for Exosa. Congrats there. Just wanted to dig in a little bit more to Exosa's performance during the quarter. I guess what that could mean for demand in 2024 and beyond. But I guess especially given the high levels of interest you're seeing in the SPHERIC survey. Were these initial adopters kind of adopters that really take on new therapies and then will it be more difficult to get additional adopters down the line because these are the early on new therapy interests there?

A quick comment and then I'll ask Susan to address in more detail is, you know, nephrologists have been trying their entire careers with these patients to get their serum phosphorus levels in check. And they have been woefully unable to with a single mechanism of action of binders irrespective of the type of binder that it is. Patients don't want to take that amount of material. low phosphorus students are unpalatable, it's really a difficult life. And when a new mechanism of action like this comes in, and as Susan spoke in her opening statement about how this is being utilized along exactly what the votes were in our adcom, it's really heartening. And I think physicians see the opportunity to finally have a tool in their toolkit that may help their patients get into the target range that they've been trying to do. And as Susan said also in our opening comments, that we are hearing from patients and from physicians that these effects are sustained. That's heartening and extraordinarily rewarding that we're going to have that kind of impact on patients. It is early days. You always are going to have early adopters, right? That's not an uncommon phenomenon. But the difference here is there's not one nephrologist out there that has not struggled with, nor one patient out there that has not struggled with how to manage her serum phosphorus. Susan, anything to add?

Yeah, I would just say, you know, the Spirix data did report a 56% user base, and that's data that was generated in April. So, and what we're seeing in the field is that nephrologists really want to spend time with our sales team. We're getting in to these offices. They're learning about it, and they do have patients in mind once they are detailed on Exposa. So, I think it's more around, it's not around an early adopter profile as much as Every doctor, to Mike's point, has been managing this challenge of getting these phosphorus levels within target ranges with the limited options they have and now are very open to incorporating exposant to the treatment regimen to try to do better. So I think that's pretty common across all the nephrologists where it's going to be important to continue to move the uptake is to expand their thinking where it's not just that patients that they've always had in mind has been so challenging. But now that you have a new tool, you know, as you see these phosphoresces every month, you know, don't wait for multiple reads or try to make, you know, everything work for them on diet or other things, the things that they've struggled with. Now they should treat these patients because of the expanded treatment armamentarium they have with Exposo. So that's what's going to be important is just moving beyond that first cohort of patients that they clearly were waiting for something new and now, you know, adapting their practice to having. blocking mechanism drug like Exposa.

Thanks, guys. That's really helpful.

This concludes our question and answer session. I would like to turn the conference back over to President and CEO Mike Robb for any closing remarks.

Thank you, everyone, for joining us this evening, including our investors who've been on this journey with us, the employees who drive our success, our partners who support us, and the patients that we serve. With that, we can close the call. Thank you, operator.

The conference is now concluded. Thank you for attending today's presentation. You may now disconnect.