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Operator
Greetings and welcome to the Arrhenia Pharmaceuticals First Quarter 2024 Earnings Hall. At this time all participants are in listen-only mode. A question and answer session will follow the formal presentation. If anyone should require operator assistance, please press star zero on your telephone keypad. As a reminder, this conference is being recorded. It's now my pleasure to turn the conference over to Andrea Christopher, Head of Corporate Communications and Invest Relations for Arrhenia Pharmaceuticals. Please go ahead, Andrea.
Andrea
Thank you, operator, and thank you to everyone for joining today's call and webcast. Joining me on the call this morning are Peter Greenleaf, Arrhenia's Chief Executive Officer, Joe Miller, our Chief Financial Officer, and Dr. Greg Keenan, our Chief Medical Officer. Today we will review and discuss Arrhenia's 2024 First Quarter financial and operational results as communicated in the company's press release issued this morning. The company also filed its quarterly financial statements on Form 10Q this morning. For more information, please refer to Arrhenia's filings with the U.S. Securities and Exchange Commission and applicable Canadian securities authorities, which are also available on Arrhenia's website at arrheniapharma.com. During today's call, Arrhenia may make forward-looking statements based on current expectations. These forward-looking statements are subject to a number of significant risks and uncertainties, and actual results may differ materially. For a discussion of factors that could affect Arrhenia's future financial results in business, please refer to the disclosures in Arrhenia's press release, its quarterly report on Form 10Q, and its annual report on Form 10K, and all of its recent filings with the U.S. Securities and Exchange Commission and Canadian securities authorities. Please note that all statements made during today's call are current as of today, Thursday, May 2, 2024, unless otherwise noted and are based upon information currently available to us. Except as required by law, Arrhenia assumes no obligation to update any such statement. Now, let me turn the call over to Arrhenia's President and CEO, Peter Greenleaf. Peter?
Peter Greenleaf
Thanks, Andrea, and good morning, everyone. I want to thank everybody for joining us on today's call. On this morning's call, we will focus on the company's first quarter performance. I'll then turn the call over to Joe Miller, our CFO, to provide additional details on our financial results. We saw continued strong momentum in the first quarter, reflecting the initiatives that the companies focused on, including demonstrating solid commercial execution, rapidly restructuring the company and reducing our headcount by approximately 25%, and accelerating the company's timeline towards cash flow positivity. So now let me dive into the first quarter business performance and how we're executing on these overall initiatives. For the first quarter of 2024, Arrhenia achieved $50.3 million in total net revenue, representing growth of approximately 46% year over year. We achieved $48.1 million in net product revenue, representing significant growth of approximately 40%. With this momentum, we remain on track to achieve our net product revenue guidance range of approximately $200 to $220 million. In terms of our restructuring efforts, we executed with speed and precision following the announcement on February 15th, while maintaining our focus on loop kindness and growth. While we've ceased development on AUR 300, we are currently exploring alternative approaches for AUR 200. Taken as a whole, we expect the restructuring will drive the organization to a cash flow positive position, excluding share repurchases, and over time will provide meaningful accumulation of cash, increasing tangible value, and allowing more flexibility for the company for the future. As part of our corporate restructuring, we reduced employee headcount by approximately 25% in the first quarter. With this effort, we expect to reduce operating expenses by $50 to $55 million over the next 12 months, and approximately 75% of that will be recognized in this year. The company expects total annualized operating expenses on a go-forward basis to be in the range of $185 to $195 million, with cash-based operating expenses of approximately $155 to $165 million. With these achievements in mind, I'm very pleased to confirm that we expect to be cash flow positive, excluding share repurchases, in the second quarter of 2024, ahead of our prior projections. On the commercial front, we are laser-focused on driving loop kindness revenues, and have several key commercial metrics driving the brand's trajectory. In the first quarter, we added 448 patient start forms and approximately 148 new patients who were either restarting loop kindness or receiving it through the hospital pharmacy. Together, these total approximately 596 PSFs in combination with restarts and hospital fills, versus 466 PSFs in the prior year first quarter, representing substantial -over-year growth. There were approximately 2,178 patients on loop kindness therapy as of March 31, 2024, in comparison to approximately 1,731 patients as of March 31, 2023, an increase of approximately 26 percent, and this was driven by overall improvements in all key commercial metrics. Net realizable revenue per patient for loop kindness remains higher than our initial guidance of $65,000 per patient on an annualized basis. As persistency, adherence and pricing have evolved over time, we now believe that net realizable revenue per patient will be in the range of $70,000 to $75,000 on an annualized basis. From the start of the year to April 28, 2024, the company has added approximately 582 PSFs and approximately 170 new patients from restarts in the hospital channel. We continue to sustain high conversion rates, with approximately 85 percent of PSFs converting to patients on therapy. We also sustained a rapid conversion time, with approximately 60 percent of patients starting therapy within 20 days. Our overall adherence rates remained high at 87 percent through the first quarter, and persistency grew year over year from approximately 51 percent of patients remaining on therapy at 12 months to approximately 56 percent remaining on therapy at 12 months. Additionally, in the first quarter, 50 percent and 46 percent of patients remained on therapy at 15 and 18 months respectively. Based on all of the above, we are reiterating our full year guidance. Our metrics demonstrate continued growth that is driving the upward trajectory of leukeminis. We are heading towards cash flow positivity and increasing the company's financial strength and flexibility for the future. Along with this strong financial performance, we also recently achieved several key milestones reflecting the importance of leukeminis as a -in-class drug with a strong clinical portfolio that aligns with the most current treatment guidelines. As announced earlier this week, the FDA has approved a label update for leukeminis. The label no longer includes language indicating that the safety and efficacy of leukeminis has not been established beyond one year. The label now includes long-term data from post-hoc analysis of the Aurora-2 extension study. The data showed that patients receiving leukeminis achieved sustained complete renal response at every time point assessed throughout the three years when compared to MMF and low-dose glucocorticoid steroids alone. Shifting to our marketing efforts, we recently launched the Know the Signs campaign, an innovative new campaign designed to increase awareness among rheumatologists about the severity of lupus nephritis and the urgent need to prioritize kidney health for people with lupus as well as encouraging them to increase screening for lupus nephritis among lupus patients. With an under diagnosed and underserved population, we continue to believe there is still significant untapped potential in the LN market. Current screening and treatment guidelines are not actually being followed. We know that a high percentage of lupus and lupus nephritis patients are not being given regular urine screens at every visit and may still only receive steroids when protein urea levels indicate additional treatment is necessary. Yet, our clinical trials have shown that lupkinis reduce protein urea roughly three times faster than MMF and steroids alone. This is why we're heavily focused on improving physicians' understanding of the seriousness of lupus nephritis. We want rheumatologists to understand the necessity of more aggressively treating and diagnosing LN patients by treating to target protein levels and keeping them on therapy for a minimum of three to five years, all of which closely aligns with current treatment guidelines. Regarding commercial activities outside the U.S., we're seeing continued revenue from Atsuka's launch activities in Europe and we're also working diligently to expand access to lupkinis to another key market with our pending regulatory approval in Japan. As previously noted, we expect to receive response from the Japanese regulatory authorities in the second half of this year regarding the JNDA that Atsuka filed in November of 2023 for the approval of lupkinis to treat adults with active lupus nephritis. Upon approval, we expect to receive a milestone of $10 million and from there, low double-digit royalties on net sales once launched. So in summary, we believe our first quarter accomplishments reflect solid execution against our previously announced business priorities. I also want to recognize it may is lupus awareness month. At Arrhenia, we take great pride in the work we do every day to improve the lives of people living with lupus nephritis. We are committed to making a difference for this patient community and we never lose sight of that. I'd now like to turn the call over to Joe for a more detailed review of the financial results, but I'll return at the end of the call for a quick recap and to then open the line to any questions that you might have. Joe?
Joe
Thank you, Peter, and good morning, everyone. Let's take a few minutes and go into detail regarding our financial results for the first quarter of 2024. Total net revenue was $50.3 million and $34.4 million for the three months ended March 31, 2024 and March 31, 2023, respectively. Net product revenue over the same periods was $48.1 million and $34.3 million, representing growth of approximately 46 and 40 percent, respectively. The increase is primarily due to an increase in loop kindness sales from our two main specialty pharmacies, driven predominantly by further penetration of the LN market. Total cost of sales and operating expenses, inclusive of one-time restructuring charge in Q1 2024, were $63.6 million for the quarter ended March 31, 2024 and $64.4 million for the quarter ended March 31, 2023. It is important to note that the first quarter was fully burdened from an operating expense standpoint as the restructuring charge was not fully implemented until late in the first quarter of 2024. Let me now give you a further breakdown of operating expenses, drivers, and fluctuations. Cost of sales was $7.8 million for the quarter ended March 31, 2024 and $421,000 for the quarter ended March 31, 2023. Increase is primarily due to increased sales of loop kindness coupled with the amortization of the model plan finance right of use asset, which was placed into service in late June 2023. Gross margins for the quarter ended March 31, 2024 and March 31, 2023 was approximately 85 percent and 99 percent. Selling, general, and administrative expenses, inclusive of share-based compensation, were $47.7 million and $50.1 million for the three months ended March 31, 2024 and March 31, 2023 respectively. The primary drivers for the decrease were lower corporate costs, employee-related costs due to the reduction in headcount, which occurred late in the first quarter of 2024, and lower spend for travel. The decrease in SG&A operating expenses reflects the early impact of our restructuring efforts, though this balance does not include the one-time restructuring charge. The one-time restructuring charge is reflected as a standalone line item in the profit and loss statement and will be discussed separately in a moment. Non-cash SG&A share-based compensation expense was $7.5 million for the first quarter of 2024 and $7.6 million for the prior year period. Research and development expenses, inclusive of share-based compensation expense, was $5.6 million for the quarter ended March 31, 2024 and $13.2 million for the quarter ended March 31, 2023. The decrease is primarily related to exiting our pipeline programs as previously announced, but does not include the impacts of the one-time restructuring charge. As previously mentioned, the one-time restructuring charge is reflected as a standalone line item. Non-cash share-based compensation expense included within R&D expense was a credit of $2.2 million and an expense of $1.6 million for the quarters ended March 31, 2024 and March 31, 2023. The primary driver for the decrease in share-based compensation is related to the reduction in headcount, which occurred late in the first quarter of 2024. Restructuring expenses for the quarter amounted to $6.7 million and in the prior year period to zero. The balance was primarily made up of employee severance and one-time benefit payments and contract termination costs. The company has recognized most of its planned restructuring costs in the first quarter. The other income was $4.1 million and interest expense was $1.3 million for the quarter ended March 31, 2024, compared to other expenses of $290,000 and no interest expense for the prior year period. The changes for both other income and interest expense were related to our Monoplan Finance Right of Use asset, which is nominated in Swiss francs and was placed in service in late June 2023. Interest income was $4.5 million for the quarter ended March 31, 2024 and $3.8 million for the prior year period. Increases due to higher yields in our investments as a result of increased interest rates. IRINIA recorded a net loss of $10.7 million or $0.07 net loss per common share for the quarter ended March 31, 2024 as compared to a net loss of $26.2 or $0.18 net loss per common share for the quarter ended March 31, 2023. As of March 31, 2024, IRINIA had cash, cash equivalents and restricted cash and investments of $320.1 million compared to $350.7 million at December 31, 2023. The decrease is primarily related to continued investment in commercialization activities and post-approval commitments of our group drug loop kindness, Monoplan payments, share repurchases and restructuring related payments partially offset by an increase in cash receipts from sales of loop kindness. The company remains debt free at March 31, 2024. With that, I would like to hand the call back over to Peter for some closing remarks.
Peter Greenleaf
Peter? Thanks, Joe. Obviously, we're looking forward to continued strong performance in 2024 and beyond. I want to thank you all for your time today. We will now open up the lines for any questions you might have. Operator?
Operator
Thank you. We will now be conducting your question and answer session. If you'd like to be placed into question Q, please press star one on your telephone keypad. We ask you to please ask one question and one follow-up. Once again, that's star one to be placed into question Q. If you'd like to remove your question from the Q, please press star two. Our first question today is coming from Morrie Raycroft from the Alfreysia line. Is that live? Hi, good morning.
Morrie Raycroft
Thank you for taking my questions. This is Farzinan from Morrie. I wanted to ask on the implications of the updated label. Your conversion rate for the PSS has been in the mid-80s. Do you expect that to improve further, or do you expect primarily to influence prescribers' perception of the drug?
Peter Greenleaf
So thank you for the question. Listen, I think the label update is a recognition by the agency of the data that we provided in addition to the original Aurora Pivotal study. I think it's going to be helpful to not be concluded in the indication language that anything beyond one year has not been studied. To have that taken out and to have the three-year data incorporated into labels is going to help us, I think, on multiple fronts. Probably not on the conversion side of the equation, but we'll see. We're looking at it more on the probably the persistency side and ensuring that the drug gets utilized as both the ULAR and the CADEGO guidelines outline, you know, three to five years of therapy, approximately. So we see it more as persistency and length of therapy and additive to the already published data that's out there.
Morrie Raycroft
Okay, makes sense. And then last month, you had like 156 that I counted, the total PSFs and restarts. So this is trending a bit lower than the average one-queue monthly numbers. Is that general lumpiness or were there any factors driving the slowness in April?
Peter Greenleaf
Well, the exact number, I think, in combination, the PSFs plus the restarts and hospitals was closer to 170. So probably just, you know, you were quick doing the math. I think it was 170. If you look at that on a per-week basis versus where we were in the first 13 weeks of the year, it's pretty consistent, maybe slightly lower, but pretty consistent with what we did in the first quarter of the year. If you look at it, April 23, it's almost directly on target with where we were in April of 23, but that was just a PSF number last year. So if you look at PSFs sort of on, you know, April 23 versus PSFs alone, in April 24, the numbers were very consistent. The big driver of the change in about 25% improvement year over year in the month of April was driven by both restarts and hospital patients. Got
Morrie Raycroft
it. Okay. Thank you so much.
Peter Greenleaf
Thank you,
Operator
sir. Thank you. Next question today is from Stacey Koo from TD Cowan. Your line is now live.
Stacey Koo
Hey there. And sorry if I repeat a question because I got kicked off momentarily. So thanks so much for taking our questions. We did have a few. First is a follow-up to what I believe was the first question. Can you talk about a big picture? What's your evolving thoughts around patient start forms and the current cadence of additions as we look forward? And then how important is formulary purchases in the hospital channel for your long-term growth? That's the first kind of question. I have a few follow-ups.
Peter Greenleaf
Thank you. I think it's a great question. Obviously PSFs we see as important. But I think as you've seen, because I think it's the best indicator of new patient volume and since 85% of those convert, new patient starts and kind of our equivalent of an NRX. But this emergence over the last, let's call it six to 12 months of the importance of restarts and albeit smaller but emerging hospital business show new lines of growth. So the way we talk about it, Stacy, internally is more, how does our new patient on therapy numbers look within the quarter? And I think that's an important one. And that's a combination of all the three. I'm not trying in any way to discount the importance of PSFs. We think all our marketing and selling initiatives that we have out there, the primary driver is identifying new patients and getting new patients on drug. But for the last, let's call it six months plus, a lot of our growth has come from both these restarts, which I think points to the importance of the Aurora II extension study, this label change and the work we've been doing over the last 12 months. But it doesn't in any way in my mind discount the need to focus on new patient growth. And while the hospital patients are indeed new patients, the PSFs are still a major indicator for that.
Stacey Koo
Okay, understood. And then around your 24 revenue guidance, you want to just walk through, remind us about the seasonality, quarterly expectations and how you feel about kind of your revenue guidance for the high and low end this year?
Peter Greenleaf
Well, as you know, we don't give any numeric or sort of pillars to the high and the low. But sort of qualitatively speaking, I think the low end of the guidance with the quarter we just produced would have to see a significant decline or some challenge in the summertime. And then back to growth in the fourth quarter and the high end of range, this is very generally how we think of it. And getting above that range is going to be driven by how well we perform in the summer. Since for three seasons now, we've had a little bit of a dip during the summertime or a flattening in the summertime. If we can power through that, we think we have the ability to be in the upper end of that range. Lastly, I think, you know, 2Q performance will be a key driver to look at guidance in general and see where we are for the year. And, you know, if that outperforms, then we'll come back to the table and talk about where we see the year coming out. But the biggest swing on 200 to that 220 range is going to be, you know, the summer months of the year.
Stacey Koo
Okay, understood. And then last question is just a follow-up on your comments around exploring alternative approaches for your pipeline product 200. Just help us understand, what does that mean? Can you go into a little bit more detail for us? Thank you so much.
Peter Greenleaf
Yeah, I think the short answer is the difference between AUR 200 and 300 in our pipeline was we own AUR 200. Yes, we have follow-on commitments to those that we purchased it from, very minimal, but we do have commitments. So, you know, we will either seek to develop the drug through someone else or to efficiently move the drug forward on our own if, in fact, you know, conversations with others don't produce the type of value that we would see for the asset and the type of speed we would want for the asset. So, in other words, we don't want to just, you know, shelve it and not get the value of, you know, this April Baff inhibitor, which obviously more and more data emerges every day on the April Baff space as it pertains to IGAN in particular, but we think more broadly there's going to be a place for April Baff inhibitors in the B cell pathway and much more, you know, immunology disorders moving forward. So, we want to keep this thing moving forward, whether it's in our own hands or someone else's.
Stacey Koo
Okay, understood. Thank you so much.
Peter Greenleaf
Thanks, Stacy.
Operator
Thank you. As a reminder, that's star one to be placed in the question queue. Our next question is coming from Joseph Schwartz from Learing Partners or Linus Alliant.
Joseph Schwartz
Hi, thank you and congrats on a strong quarter. I wanted to ask first about your initiatives around screening and diagnosis. Where is the community now on that front? How much screening is being done and how much have you been able to move that needle and how is progress there contributing to new patient starts relative to the other initiatives you have ongoing?
Peter Greenleaf
Thanks for the question, Joe. I think we have one series of, you know, sort of physician-reported AAU that's been done and at least at the rheumatologist level, what we can tell you is that we're seeing some improvement in treatment. We're seeing some improvement in awareness of need to diagnose lupus patients and do urine screens. We haven't seen that, Joe, pull through yet to actual claims data. There's no direct, it's not -to-one and it's kind of even our interpretation of claims data is kind of, you know, you have to take some liberties around what's submitted through the claim to try to get under that. What I can tell you is these numbers have been like grossly low historically, at least as reported by a large patient record audit that was done by Optum a few years back looking at lupus patients, a couple hundred thousand lupus patients over several years. And you're looking at numbers like, you know, less than 50 percent of these patients even get a urine screen. This is lupus patients. Guidelines say they should get it every time they come in the office. And when they do have a positive proteinuria or a proteinuria level the guidelines would indicate indeed is a lupus nephritis diagnosis. Only 30 percent of them even get treated. And you can say, well, geez, why? I think one is just general awareness.
Optum
And I think, you know,
Peter Greenleaf
hematologists will treat proteinuria and lupus nephritis differently. I think they see lupus nephritis as several grams of proteinuria or protein in the urine. And they see low proteinuria as not indeed being nephritis. Now, that's a little bit of a liberty from some of the research work we've done. But the awareness we need to build is that even low levels are indicative of poor outcomes for the patient moving forward. And you're never going to find it unless you're doing the urine screens. And I think we're making impact there. More to come as we continue the campaign forward.
Joseph Schwartz
Yeah, it seems like a great area for your white space. I was wondering also regarding the updated label. I think that happened a fair amount ahead of expectations given we were expecting an update in the second half. So can you talk about why that turned around so fast? How does the updated label fit within your expectations? And is there any potential to limit the REMS in the future with any additional label updates going forward?
Peter Greenleaf
Well, we don't have a REMS in a technical sense. So maybe I'll answer the question and maybe as you're thinking about it, Joe, come back to me with what you mean by the REMS. As we previously communicated, we let the agency know that we were going to do the extension study and that we were also going to do a biopsy sub study as part of the pivotal. The agency said great, we'd love to see that data. But it wasn't packaged as your classic supplemental NDA. So when we fed this data to the US FDA, obviously we were glad they would take it but understood that it could potentially fall outside of the technical supplemental new drug application process. The agency luckily treated it much like a supplemental and they performed within the 9 to 12 months category of what a normal supplemental is. We were more conservative probably in our estimate because this technically wasn't, in our view, a supplemental NDA package. So it came earlier than maybe the way we guided externally, which is a positive. And I think in terms of our expectations, this hit pretty much everything we had expected. We wanted the language removed from the indication statement now that there's more than one year data and we wanted the data incorporated. I will say that the biopsy sub study data was not incorporated but we don't think that's limiting. We think that data can still be made available through publication and through medical drug and information request forms.
Joseph Schwartz
That makes sense. That answers my question. And then what about your recently announced buyback? Have you made any progress buying any shares back yet?
Peter Greenleaf
Short answer is yes. Within the quarter, actually up until the end of April, we purchased about $18.4 million worth of stock with an average cost of $5.37, which equates to about 3.4 million total shares. Just for future, because I'm sure that's kind of the follow-on question, we would look to fund any future purchases through discretionary repurchases through cash flows and not through what's cash on hand, and it's at the discretion. So we'll report out more as we go here. But $18.4 through the end of April.
Joseph Schwartz
Helpful.
Operator
Thank
Joseph Schwartz
you.
Peter Greenleaf
Thanks, Joe.
Operator
Thank you. Next question is coming from Ed Ars from H.C. Wainwright. Your line is now live.
Ed
Hi. Good morning. Thanks for taking my questions. Just a couple here. I wanted to follow up again really on the bigger picture here, in particular with the updated label. I gather you got the main aspects of that. You got into this new label. In particular, I wanted to have you speak a little bit further, Peter, if you could, on your view of that, the impact of that label, particularly longer-term persistence, and doctors eventually treating this as a long-term treatment, along with the Know the Signs campaign, which in particular targets the rheumatologists, which have been the lower prescribing group of the two. Just broad thoughts on the longer-term perspective and impacts of those.
Peter Greenleaf
Well, I'm sure it wasn't missed on anybody, but over the last couple of quarters, we've actually seen improvement in terms of our persistency. At least from my history of doing this for a little while on multiple drugs, persistency is a really hard thing to move. In the biologics category when we launched Anti-TNF, I remember those numbers staying fairly consistent for a very long time, no matter how much money we threw at it. I think here we were right below 50%. We had to 50% one year, and now we're at 56%. On a macro level, I think having this data out there that shows that at least this CNI can be used, this next generation CNI can be used for longer periods of time is incredibly helpful. I think alongside of that, the guidelines are now very vocal about aggressive diagnosis, earlier treatment. They've always been fairly consistent about levels and needing treatment, but now they're very clear. You actually have companies and investment going into educating and making sure that people start to actually put these guidelines into play. For the longer term, the bigger picture question, we need to see more aggressive diagnosis in the rheumatologist's office. We need to see target levels of proteinuria treated by rheumatologists when there are signs. This is not just Arrhenia's goal. This is the goal of the treatment guidelines. Then those treatment guidelines estimate the patient should be on an estimated three to five years. All of those things have significant level of improvement that can happen. I think that's what's going to move this whole category to a much larger opportunity for the industry. I also think it's going to take the burden of disease for the patients we're trying to care for here and take it down dramatically. That's kind of the big picture view, at least as we see it,
Ed
Ed. Great. That's helpful. A couple more, if I may. Just one question on AUR 200. You mentioned that remains a very interesting target, the April bath inhibitor. Just wondering if you have any particular development timelines or anything you can share in terms of news flow near term with that. Then last question, wanted to ask about the comment about the newer higher expectations for kindness pricing 70 to 75 versus the 65 previously. What is it that you think has persisted and changed your view from prior expectations? Thanks again.
Peter Greenleaf
Yeah, I'll take the first one and then I'll, Joe, kind of give his two cents on the 70 to 75 average net. Listen, I did get, just to give the most update information that we have on it, AUR 200, the IND was approved by the US FDA. We are ready to start sad, mad studies. As I said on the call, our goal is to keep this thing moving forward. When we actually do have a path, whether it's internally or externally forward, we understand that getting clear about how long those sad, mad studies will take, when you're going to have your first in human clinical studies and when you should expect to see phase two data, phase three data, et cetera, and in what indications soon. I would earmark that one for a future call, but know that the IND has been approved by the US FDA and we're moving into animal talks and in the sad, mad studies this year, either through or through an external party. The pricing question, let me kick that to Joe.
Joe
Yeah, to follow up on your pricing question, it's kind of two factors. One is obviously Peter already touched on it, which was the persistency itself that has evolved kind of considerably over time. I think if you look back Q1 of 23, it was about 51% at 12 months. It's now moved to 56% at 12 months. So that's probably your largest driver for the evolution of the net revenue per patient estimate. Also coupled into that is some small price increases over time that have kind of inched up that number on average.
Operator
Thank you. Next question is coming from David Martin from Bloomberg. Your line is now live.
David Martin
Yes, good morning. Thanks for taking my questions. First off, also going back to the updated loop kindness label, is there any part of that that could give rise to new patent claims, do you think, or is everything related to the change already in your existing patents?
Peter Greenleaf
Well, as we've mentioned previously, David, we have patents on file with the US FDA that have not or the US Patent and Trade Office that have not publicly been disclosed and won't be until we actually get some action, whether it's an acceptance of the patents or not. I can tell you that regardless of the US label change, and the US label can be helpful to those patents in terms of the orange book listing, we started looking at that back when we unearthed the data from the extension study in general. And I would just leave you with know that it follows sort of that line of possibility in terms of those patents that are on file with the US FDA. So the short answer is yes, but we haven't had a readout from the USPTO yet.
David Martin
Got it. Second question, with restarts becoming more important and trending up, do you have a read on what percent of patients have the proteinuria rebound after coming off loop kindness? And how long does it typically take for that rebound to occur?
Peter Greenleaf
The short answer is, and I would look to Greg if he's got a clinical answer to this, I think the data is emerging on this in terms of what we know internally, in terms of seeing the percent of the patients come back. I'm not sure that we have a quantitative read as to how long that takes and what those proteinuria levels are. What we do know is unfortunately the disease, and this isn't a loop kindness issue. This is an MMF issue. This is a loop kindness issue. It's any drug that comes after us until we get more alignment to treatment guidelines that it's treated episodically. And some of this might be due to the fact that historical drugs had a lot of toxicity alongside of them that they used to treat the disease. So trying to intermittently treat was a pattern that was just derived from trying to manage these potentially toxic drugs that were being put on the patients. But the short answer is we see this is continuing to be an opportunity as we shift the market more aligned to guidelines. Greg, what would you add?
spk09
At the end of our Aurora program, we monitored patients for a subsequent four weeks, and there was stability with regard to the patient's response in terms of proteinuria for that subsequent four weeks. Thereafter, I certainly agree with you, Peter, that different individuals will have recurrence at different points. And I'll just emphasize one thing. The opinion leaders in this area indicate like you are implying this is a chronic disease, not an episodic disease irrespective about how clinicians treat it, and hence the recommendations to maintain treatment once they secure response is important. Thank
Operator
you. We reach the end of our question and answer session. I'd like to turn the floor back over to management for any further closing comments.
Peter Greenleaf
I want to thank everybody for their time today. Look forward to updating you as we move into the second quarter. Have a great day.
Operator
Thank you. That does conclude today's teleconference and webcast. You may disconnect your line at this time, and have a wonderful day. We thank you for your participation today.
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