BioCryst Pharmaceuticals, Inc.

Ladies and gentlemen, thank you for standing by and welcome to the Biochrist third quarter 2021 earnings call. At this time, all participants are in a listen-only mode. After the speaker's presentation, there will be a question and answer session. To ask a question during the session, you will need to press star 1 on your telephone keypad. Please be advised that today's conference is being recorded. If you require any further assistance, please press star 0. I would now like to hand the conference over to your speaker today, Mr. John Booth at Biochrist. Sir, please go ahead.

Thanks, Lorenz. Good morning, and welcome to Biochrist's third quarter 2021 corporate update and financial results conference call. Today's press release and accompanying slides are available on our website. Participating with me today are CEO John Stonehouse, CFO Anthony Doyle, Chief Commercial Officer Charlie Geyer, Chief Medical Officer Dr. Bill Sheridan, and Chief R&D Officer Dr. Helen Thackeray. Following our remarks, we will answer your questions. Before we begin, please note that today's conference call will contain certain forward-looking statements, including those regarding future results on audited and forward-looking financial information, as well as the company's future performance and or achievements. These statements are subject to known and unknown risks and uncertainties, which may cause our actual results, performance, or achievements to be materially different from any future results or performance expressed or implied in this presentation. You should not place undue reliance on these forward-looking statements. For additional information, including a detailed discussion of our risk factors, please refer to the company's documents filed with the Securities and Exchange Commission, which can be accessed on our website. I'd now like to turn the call over to John Stonehouse.

Thanks, John. Three-quarters of the way into 2021, and this has been an amazing year of execution for our company. The successful launch of Orladeo and the rapid advancement of our pipeline are the evidence. Orladeo is our first oral drug to get to the market, and by all measures, including that we did it in a pandemic, we significantly exceeded everyone's expectations prior to launch. We now have a good line of sight to the trajectory of sales and have guided that for the full year we will achieve between $115 and $120 million in net revenue. What's even more exciting is we're just getting started. Charlie will share more color on the launch and what opportunities for continued growth lie ahead. The bottom line is patients with HAE want a once-daily oral medicine to prevent their attacks. The strongest evidence of that is they are switching from injectable therapy even when they're controlled and satisfied with these treatment options. Why? Because they want more. They now see an option to control their disease and the ability to reduce the burden of therapy. Our market research told us this two and a half years ago. We're seeing it play out exactly the same way in the marketplace, and Charlie will share recent surveys that show those attitudes will increase in the future. As we continue the consistent, steady growth of the launch in the U.S. and continue to gain approvals and launch in other countries around the world, our confidence that we will substantially exceed our global peak sales target of $500 million grows stronger every quarter. Orladeo is showing that oral drugs can have a huge impact on the lives of patients with rare disease. But what if we could repeat this over and over again in many different rare disease settings? That's our strategy, and we have a world-class discovery platform that differentiates us through its unique capability to develop potent, specific, and orally bioavailable compounds against very difficult biologic targets. Orlodeo is the first to make it to market from our discovery engine, and our oral factor D inhibitor, BCX9930, is next. Going after factor D as a target allows us not only to bring another oral drug to patients suffering from a rare disease, but there are multiple diseases to treat with an oral factor D inhibitor, as the alternative pathway plays a key role in many complement-mediated diseases. After demonstrating proof-of-concept in PNH patients late last year with 9930, we are now in pivotal studies in PNH and a proof-of-concept study in three nephritis indications. Our pipeline is full and following quickly behind Orladea. There are many more rare diseases to pursue and many patients waiting for any drug, let alone an oral drug, to treat their disease. 2021 continues to be an extraordinary year for Biochrist, and the good news is we're just getting started. Now I'll turn the call over to Charlie for more details on the Orladea launch.

Thanks, John. This launch got off to a great start 11 months ago, even better than our own high expectations. We knew going in that HAE patients really wanted an oral drug to prevent attacks, and that is exactly what we were seeing as the number of patients taking Orladeo grows steadily month after month. For the third straight quarter, we saw the same strong volume of new patients starting on Orladeo. More than half continued to switch from other prophy treatments, and patients are staying on therapy in line with our expectations because they're doing really well. We also continue to see more physicians embracing Orlodeo. The prescriber base grew by another 25% in Q3 and now includes nearly half the top 500 HAE treaters. Access also continues to improve. Nearly all new patients benefit from our Quick Start program, but the average new patient now receives paid product within 30 days. As strong as this launch has been, we see a trajectory ahead that will make Orladeo the market leader in HAE prophylaxis. Comprehensive market research with large samples of HAE patients and physicians has long shaped our expectations and guided our strategy and has proven to be very accurate in predicting what we are seeing in the launch. In August, we surveyed another 60 U.S. physicians who treat an average of seven HAE patients each. They reported favorably on their clinical experience and see use of Orlodeo doubling to become their most prescribed prophy treatment over the next 12 months. Our internal prescription data back this up. The number of repeat prescribers among the top 500 HAE physicians is substantial and has doubled since the first quarter. There are also multiple catalysts that will continue to fuel this launch. For example, the new 96-week data from APEX2 showing sustained 80% reduction in attacks is persuasive to physicians. That level of long-term attack control is what they expect from a prophytherapy, and the data give them even more confidence to prescribe Orlodeo. We also recently began in-person patient education programs. which will be critical to activating patients and spreading word-of-mouth experience. And we are very excited to attend our first in-person major medical conference this weekend with a college meeting in New Orleans. We'll present data on how well HAE patients do when they switch to Orladeo from other Profi products, so stay tuned. Thank you. U.S. sales will account for nearly all of what we report in 2021, but global launches will add future inflection points to Orlodeo growth. A key example is the favorable NICE recommendation for Orlodeo received in Q3 for patients in the U.K. By the end of this month, Orlodeo will be covered for HAE patients having a history of two attacks or more per month. In contrast, Taxairo and Synrise are covered for a much more limited group of patients experiencing two or more attacks per week. This coverage will allow patients in our AIMS expanded access program to convert to reimbursed product and will make Orladeo the first-line prophy treatment for the great majority of the U.K. market. We also recently secured reimbursement approval in Norway, a market where only androgens and Synrise are currently available. Launches are underway in Germany, France, Japan, and the UAE with more to come. We intend to bring Orlodeo to HA patients all over the world. And with composition of matter patent protection through October 2039, we have many years of global growth ahead. It boils down to this. Orlodeo is a drug that can change the lives of HA patients by controlling attacks with a minimal burden of treatment. I'll turn it over to Helen to expand on how our clinical data align with the real-world experience we're seeing.

Thanks, Charlie. The ability of Rolodeo to prevent HAE attacks has been truly impressive, and this is something we're hearing consistently from physicians based on their own experience prescribing Rolodeo. The pivotal trial experience in the first 24 weeks of the APEX2 trial was just the beginning of our understanding of of the potential for Orlodeo's impact on HAE attack rate. Now, in the long-term follow-up of clinical trial patients, we've seen an average 80% reduction in attacks from baseline. This is in the 96-week data, which shows that patients have durable, substantial reductions in attacks. The original demonstration of a 44% reduction in attack rate was in comparison to the placebo group, and it was at the early time point for the pivotal trial registration endpoint. Even then, at 24 weeks, we saw that there was a substantially greater drop in attacks when compared to an individual's own baseline attack rate. We observed then that 50% of patients were having 70% or greater reduction from their baseline attack rate. Now that there is real-world evidence from the launch in the U.S., that high rate, a 70% reduction or more that we observed, is consistent with what we're hearing from providers today. They tell us patients are doing well and continue to do so. Now, in our long-term follow-up from the trial, we can see why. With this understanding, we're excited about the future opportunity here. We know that patients do well and have large sustained reductions in attack rates as they continue Orlodeo. To go into a little more detail on the newer information that we find so compelling, what we presented at the IACI conference in July is that with long-term treatment, attack rates are generally reduced to a greater extent, and this outcome is durable. Specifically, on slide five, you can see that in the patients who completed 96 weeks of treatment with Orladeo, almost two years of treatment, an 80% average reduction from the mean baseline attack rate per month was observed during parts two and three. And median attack rates decreased over time from 2.7 attacks per month at baseline to zero attacks per month in 16 of 17 months during Parts 2 and 3. What's notable here is that the response, the reduction in attack rate, is durable. Patients are staying on treatment and experiencing an enduring result. Not only that, we see large reductions in attack rate regardless of prior prophylactic treatment experience. and patients on Orlodeo have decreased needs for on-demand treatment. Finally, Orlodeo continue to be generally well-tolerated through the long-term follow-up treatment, which is also consistent with our real-world experience observed through 11 months of launch. We are seeing most patients staying on therapy and having an excellent experience on Orlodeo. More and more physicians are seeing for themselves the strength and durability of efficacy with Orlodeo. the excellent tolerability profile, and just how happy their patients are when they switch to Orlodeo. As Charlie mentioned, we are excited to be heading to New Orleans this weekend for the American College of Allergy, Asthma, and Immunology meeting, which will be our first live meeting since we launched. It will be an opportunity for doctors to come together and share their experiences with each other. We'll also be presenting our new data on outcomes for patients who switched from injectable prophylaxis to Orlodeo. Of course, right behind oral Adeo, also coming from our Discovery Center of Excellence in Birmingham, we have our next oral medication for rare diseases, BCX9930, rapidly advancing in development across multiple indications. Bill reported at our last earnings call that we have proceeded to pivotal trials in PNH, and the momentum continues to build. Today, Bill will give an update from that study, including the clinical changes we've seen in patients. In total, the observations in this study provide robust evidence of clinical effect and the impact on how patients feel when treated with BCX-9930. Based on these data, we conclude there is exciting potential for 9930 to be an effective therapy for the treatment of PNH, and we have turned our full focus towards the pivotal program in PNH and expanding into subsequent indications. We are confident that this drug has the potential to deliver improvements in both the burden of disease, and the burden of treatment, and to do so with durable benefit for patients. Bill?

Thanks, Helen. As Helen noted, the P&H program for BCX9930 has moved directly from a proof-of-concept dose-ranging trial to pivotal trials, with dose selection, endpoints, and trial designs agreed with the regulators. A reminder of the primary and key secondary endpoints in our two pivotal trials is shown on slide eight. In both trials, change from baseline and hemoglobin is the primary endpoint measure. Both pivotal trials include measures of red blood cell transfusions and also an important quality of life metric, the FASIC fatigue score, as key secondary endpoints. Importantly, these endpoints reflect the goals of treatment of PNH patients with complement inhibitors to correct an area reduce or eliminate transfusion burden, and relieve symptoms. In the REDEEM-2 placebo-controlled trial in patients with PNH not treated with C5 inhibitors, descent change from baseline and LDH is also a two-second endpoint. As shown on slide 9, the efficacy evaluation in REDEEM-2 is at week 12. In our long-term rollover safety trials, the patients who continued from the proof-of-concept trial. We had nine patients naive to C5 inhibitors who had received BCF9930 monotherapy for up to 19 months as of the end of September. Hemoglobin over time in each patient is displayed in the panels in the figure on slide 10. We analyzed the proof-of-concept data, the doses of 400 or 500 milligrams BIDs, according to the measures of benefit relevant to Raden 2, with the outcome shown in the table on the same slide. As you can see, hemoglobin rose from the baseline by a mean of 3.7 grams per deciliter. All nine patients were transfusion-free. LDH fell by 65%. And facet fatigue scale total score rose by 7.1 points. For those not familiar with this score, the Minimum clinically important difference is three, so that's very impressive. These proof-of-concept results give us confidence that oral dosing with BCX9930 will perform well against placebo in patients not taking C5 inhibitors in the D2. Six patients who had inadequate responses to C5 inhibitors also entered the long-term wall-over trial from the proof-of-concept trial. The BCX9930 initially added to continued C5 inhibitor treatment. The displays of the data are set up on slide 12 in the same way as the C5 inhibitor naive cohort. In regime 1, the efficacy outcomes will be measured from week 12 through week 24. We have presented the results both overall and excluding data from one patient who would be ineligible for regime 1. In that analysis, the knee change from baseline inhibit loathing From weeks 12 through 24, it was 2.7 grams per deciliter. 80% of patients were transfusion-free, and the facet fatigue score rose by 3.4 points. One patient who developed anemia after COVID-19 vaccination was recently discovered to have a warm antibody-inverted anemia disease. This immune reaction to vaccination was unrelated to PNH or to BCX-9930. The patient was transitioned to BCF9930 monotherapy but withdrawn from long-term follow-up due to this diagnosis and development of other unrelated illnesses. In three other patients transitioned to BCF9930 monotherapy, benefits were maintained. These results give us confidence that oral dosing of BCF9930 will perform well in regime 1 against continued C5 inhibitors in patients with inadequate response to those medications. No safety signals have been seen in long-term dosing with BCX9930. The accumulating favorable long-term safety profile, together with the evidence of benefit that I have described, make us very excited to complete the pivotal trials as quickly as we can and file our regulatory applications for approval in the U.S. and around the world. I'd now like to hand the call over to Anthony for an update. Thank you.

Thanks, Bill. Having both significant revenue from Orladeo and an even bigger fast follower across multiple indications with 9930 presents a fantastic opportunity to deliver for patients and drive value for shareholders. You can find our detailed third quarter financials in today's earnings press release, and I'd like to call your attention to a few items. Revenue for the quarter was $41 million, of which 37 came from net sales of Orladeo. Operating expenses, not including non-cash stock compensation for the quarter, were $72.5 million. Our gross-to-net adjustment, including access to free drug, continues to improve and is on track towards our target of 15% to 20% at peak sales. As John said, with our expectation that Orla Day will generate net revenue for full year 2021 of $115 million to $120 million, and revenue from international regions set to become more meaningful, we are very well positioned for a strong 2022 and beyond. We ended Q3 with $204 million in cash. Cash on hand, continued revenue growth from Orladeo, and access to the additional $75 million available from Ethereum gives us cash runway into 2023. This cash position and continued access to multiple different sources of capital enhanced by our strong results and execution puts us in an outstanding financial position to fully invest in launching Orladeo globally and to advance our Factor D program. Based on the trends that we see, we are very confident that the strong launch of Orladeo in the U.S. will continue and be enhanced as international markets come online. With 9930 as a fast follower and with more to come from our R&D engine, Few biotechs are as well positioned for significant and sustained growth and value creation as we are here at Biochrist. It is a very exciting time to be a Biochrist shareholder. Operator, we'd now like to open it up for Q&A.

Thank you, sir. At this time, if you would like to ask a question, please press star 1 on your telephone keypad. Again, that is star 1 on your telephone keypad. Your first question comes from the line of Tazin Ahmad. from Bank of America. Your line is open.

Thanks for taking my questions. A couple, maybe one on Arladeo. So John, can you give us a sense of where in Europe right now you're starting to get sales? Presumably Germany would be one of those countries. And can you give us a sense about how the dynamics in Europe might in any way be different than the dynamics that you've seen here in the U.S., meaning you've seen a fast uptake here. Would there be any reason to think that you wouldn't see a fast uptake in Europe? And then secondly, for P&H, maybe a question for Bill. Based on your inclusion criteria, how is enrollment in your mind likely to proceed, and when do you think you would be in a position to have top-line data? Thank you.

Sure. Thanks for the question, Tazine. Charlie, just to make sure I get this right. So in Europe, the contributors where we're launching and selling drug are in Germany. We actually have a cohort ATU in France, so we're selling in France. And as Charlie mentioned, in the U.K., by the end of the month, patients will have access and we'll be selling drug in the U.K. The difference, I can tell you that COVID has had a bigger impact in There's less telemedicine going on in Europe than there had been in the U.S., and so patient-doctor interaction has been less. So I think the ramp is a little bit slower. But, you know, we expect a pretty good contribution for 2022. And the team has, you know, really been working hard at getting set up. And, Charlie, you might just want to talk a little bit more about NICE and the EAMS and why you're so excited about the U.K.? ?

Yeah, thanks, John. The U.K. is very exciting, and it's two things. One, any time you get a positive recommendation from NICE for any rare disease, that's a big deal. And the fact that modern prophy has been very limited to that niche of patients with two attacks per week or more, but with Orlaneo it's going to open up much wider with two attacks per month or more. So the majority of the market, frankly, that we're available to be eligible for, and then we have those EAMS patients that we can convert, and we expect to do that over the next few months. The U.K. is probably the one place like the U.S. where we can get out of the gates a little faster, Tazin.

And then, Tazin, the last point that I'll make before I hand it over to Bill is, you know, as we add a country, you know, it's an opportunity to get more patients and generate more revenue. And Norway is an example, you know, and we'll continue to do that over the course of 2022 and beyond. So, Bill, do you want to take Tazin's question around entry criteria and impact on enrollment? Sure.

Sure. Thanks for the questions. I think the eligibility and the other characteristics of these studies and the opportunity to investigate a proximal complement inhibitor with the characteristics of 9930 make both studies very attractive, actually. And there's plenty of excitement from the hematology community in participating in these studies around the world. In fact, I don't see... particular barriers with regards to the eligibility criteria. Both studies are on track for startup. We're very busy doing that right now. It's really hard to predict when we'll finish enrollment because the field is so competitive. So until we have the first few months under our belt and see what the trajectory is like, I think it would be hard to predict exactly when we'll finish.

Okay. And do you think that there would still be any kind of COVID impacts at least in the developed world?

So I think people have started to figure out how to continue clinical trials during COVID. I mean, we did that in the proof of concept trial. We had to make adjustments, of course, but medical practice had to go on. Telemedicine, as an example, in the U.S. I think that there have been supply chain disruptions, as we all know. There are all sorts of impacts, but I think the community in general is figuring out how to continue important clinical trials.

Okay, great. Thank you.

One other point that I'd like to make that Bill probably won't brag on, but I'll brag on for him, is the quality of execution that he and his team have demonstrated with the HAE program. You know, large numbers of sites around many different countries, you know, and that can add risk, but Bill's team has done a great job of ensuring absolute quality and then really high-touch execution with every single site, medical monitors talking to investigators about, you know, the patients they're planning to enroll. And so that oversight and high-quality, high-touch makes a big difference not only in speed but in the quality outcome of the trial. So that's an important piece to success in a pivotal study.

Okay. Thank you, John. You're welcome.

Thank you.

Your next question comes from the line of Brian Cheng from Cantor Fitzgerald. Your line is open.

Good morning, team. Thank you for taking my question. So maybe for Charlie, I wonder if you can provide a bit more color on the growth of the prescriber base. It seems that the growth rate has fluctuated a bit this quarter compared to the last. How much of the fluctuation do you think is due to the summer holiday and the Delta variant headwinds that you mentioned previously on the second quarter call. And do you have any color on the pace of adoption in your Tier 1 versus Tier 2 prescriber base? Have you seen any significant difference between the two? And then I have one more follow-up. Thank you.

Great. Thanks, Brian. So on the overall prescriber base, it's growing really strongly. And so I think you're referring back to in Q2 we said that the base grew by 50%. This quarter it grew by 25%, but on a much larger base. I think that's the key thing to pay attention to. And as far as Tier 1 versus Tier 2, as I said in some of my comments, what we're particularly excited about is the penetration and growth in the Tier 1 top 500 physicians. So we're up to about almost 50% of them have prescribed. We're seeing a doubling of repeat prescribing amongst those docs. And then our forward-looking market research tells us with docs just like that that they expect to double again over the next 12 months. So it's going really well. We still get business from the next tier, and we're still going to explore every corner of this market because there are patients everywhere. But Tier 1 is going fantastically well.

Great. And then one more on access. Can you remind us how payer access is looking like now? on commercial insured patients. And then how should we think about access for Oladeo in the new year? Thanks.

Yeah, payer access continues to go well. So first off, patients are getting – the average patient gets the paid product really quickly. So within 30 days, that's what we expect, and we expect it to continue to improve. We've had great progress throughout the year in terms of coverage policies. We had a couple more wins in Q3, but, you know, we still have some payers to go, and we expect continued progress through the rest of this year and into early next year. As we turn into the second full year, that will be a key time for us, too, as patients switch around plans, and we're ready for that. So we feel really good about where we are with access.

Great. Thank you.

Your next question comes from the line of Lisa from Evercore. Your line is open.

Hi. Thanks for taking the questions. Can you clarify what you include in net revenue guidance for Orla Dale?

Yeah. So included in the net revenue is, you know, like we said, the vast majority of it is going to come from the U.S. And so included in it is the I think, 74.5 year to date. And then in Q4, it will be the U.S. plus the European countries that we have added. And just, again, to bear in mind, from a revenue perspective here in the U.S., it's based on shipments, no stocking, no stockpile orders, just, you know, when it gets direct to patients, that's when we'll recognize the revenue.

Okay. And that's not net of your royalty to our fee, and it's not? It doesn't include the Japanese royalty.

Yeah, so it does include the Japanese. It doesn't include the full amount of the Japanese revenue because that's borne by Tory. What you'll see is it'll hit our royalty line, the portion that we take from Tory. It does not include the royalty. That's below the line.

Yeah, okay. And can you give us a sense of what gross nets were for the quarter?

Yeah, what we've said is that gross net continue to get better. So Charlie's talked about access and how the access has continued to improve. The vast majority of the adjustment for the gross net continues to be free product. You know, we are seeing adjustments as and when we get payors added. You know, it will continue to get better quarter over quarter, and Lisa, we're still on track to get to that 15% to 20% that we've talked about when we hit our peak sales.

Okay, great. And then what kind of compliance persistence are you seeing thus far?

Compliance, if you're talking about compliance or people taking their medicine one pill a day, has been really high. So it's been north of 90%, just like we saw in clinical trials. And then persistent patient retention has been very strong as well, in line with our expectations.

What does that mean? What are your expectations?

So right now, follow up this through Q3, 80% of patients who've started on Orladeo are still on Orladeo. And over a one-year period, we see that settling out at around 70%, so about 70% of patients staying on Orladeo across a year.

Great. Thanks. Okay. And then so for the third quarter, can you just describe, you know, When you talk about net revenue, does that include – there's some ex-U.S. revenue in there, I assume. Could you maybe just talk about it?

Yeah, Lisa, it is nearly all U.S. revenue.

Okay.

Okay. The contribution outside the U.S., you'll see more in 2022. Okay. Okay.

And then just a final question for me. You kind of talked about looking, you know, forward to, you know, more developments from your research engine. So can you talk a little bit about that? And then along those lines, any update on the FOP program? Thanks.

Sure. You know, the beauty of the strategy is we have this discovery platform that where we can build, as I said in the prepared remarks, potent, specific, and orally bioavailable molecules on really hard biologic targets like serine proteases and kinases. And we've seen that others have tried it and have been unsuccessful, right, and stumbled. And so you've got to be able to do all three to bring in oral medicine to these patients. And So we're working with our oral factor D inhibitors, as you know, and Helen and others are working hard at what indications do we go beyond the four we've already chosen and are starting to study. And so that's really exciting. But then, as you said, the ALK2 inhibitor for FOP, we're playing a bit of catch-up on that front with getting drug supply and tox work, but nobody's going fast. In this space, it's a hard disease to tackle, and we still believe there's a lot of unmet need. And the data we see thus far in our Phase I trial gives us a lot of confidence that 9250 has a shot at being a real therapy for, you know, these patients that have nothing. And then there'll be more to come. You know, Babu and team are working in Birmingham on other rare disease targets. And when they're ready for prime time, we will be sharing what else we're going after and what we're investing in for more drugs for patients with rare disease.

So when will we hear more about FOP? Like what's precluding you from moving it forward now or what are the next steps and timings?

Yeah, the bulk of this year has all been about the drug supply and tox. So there was really no opportunity to get into any kind of clinical development. Then another important step is talking to the regulators about what the path is. And so, you know, this is a disease that the earlier you treat, the more impact you have. And so what's required, you know, to get to those age children that have that kind of impact. So we've got to work through that. and then also, you know, continue to figure out the design of the trials moving forward. So right now I can't give you a timeframe on when we plan to start clinical trials, but, you know, we're trying to go, we're trying to speed that up a lot, and you'll hear more about it next year.

Okay, great. And then, sorry, just to clarify, I didn't catch everything Charlie said about he kind of gave some color on you know, something doubling over the next six or 12 months. I didn't catch everything. I was wondering if you could just repeat as you were talking about kind of like patient ads.

The market research.

Yeah. Sure, Lisa. You know, we do large surveys with doctors. We did another 60 physician survey, average of seven HA patients for each of those docs. And what they said is they're really happy with what they've seen so far, and they see their prescribing doubling over the next 12 months. to become their most prescribed HAE profi therapy.

Thank you.

Thanks, Lisa.

Your next question comes from the line of Stacy Koo from Cowan & Company. Your line is open.

Congratulations on the progress, and thanks for taking our questions. I have a few. First, given your commentary about the Q3 tailwinds in the last few months, very encouraging to see continued solid growth. So can you provide any early thoughts on your current expectations for next year? And then can you also comment on the percent of sales calls that have been face-to-face at this point? How much growth would you expect without this impact on COVID? Could you provide some level of magnitude? And I have a follow-up.

So, Charlie, why don't you talk about the things that you think are going to kick in to adding value in 2022, and I'll handle the question about what we expect.

Yeah, absolutely. So, Stacey, some of the things I mentioned on the call, first off, the 96-week data that I talked about, Helen talked about, showing sustained 80% reduction, that's been really persuasive to physicians, and we're just starting to roll that out. So, That's a big one. We are starting to do live patient meetings, which is another big thing because patients don't like to do things on Zoom, and that face-to-face contact and word of mouth is really important. And then just live meetings with doctors. This weekend, the college meeting in New Orleans, a lot of the key prescribers in the HE space are going to be there. We're going to be meeting with them. We have new data. and we expect to have many more of those kind of live meetings in the coming year. All of this is going to contribute to the strong and steady growth in patients that we're already seeing.

Yeah, and Stacey, with regard to what we expect next year, we're not in a position to guide. We just guided for this year today, but we will. You know, Charlie has a very good line of sight now on the trajectory of of this launch, you know, I don't know if you caught, but he said that from what we see and what we hear from physicians, we expect that this will be the market leader in the prophylactic treatment of HAE patients. And so, as you said, there's a really solid base that we're working on, and that Charlie's team is adding a steady and consistent amount of new patients into the funnel every single month. And as he told you when Lisa asked the question about discontinuations and the rate of discontinuations in line with our expectations, which is much slower than the rate that we're filling the funnel, right? So that just shows you a curve. Hopefully I'm painting a picture of a curve that's very steady growth. So, you know, I would expect that sometime in the new year we'll give guidance for 2022, and at some point we'll also give an update on our adjusted global peak sales because the 500 number is It's no longer accurate, and it's definitely on the plus side.

And, Stace, I don't think I answered your question about sales calls, but we have reached 100% of our top prescribers, the tier one physicians. In Q2, we got into a lot more in-person calls. In Q3, I think that dropped just a little bit. But in general, we're making more in-person calls than virtual calls, and we expect that to really continue going forward.

Thanks. It's really helpful. And one last question on pipeline for 9930. For the renal basket study, when could we start seeing initial or interim data?

Bill, you want to tackle that one?

Sure. The renal basket study is set up as a real learning experiment in three specific nephritis conditions that are driven by the alternative pathway complement. C3 glomerulopathy, primary membranous nephropathy, and IgA nephropathy. So what we want to do here is learn as much as possible. We also want to make sure that patients have active illness at the time that they enter, and to do that, we require a recent biopsy. The screening period is up to 56 days to allow for all of that to happen in the central pathology review, and the sites are getting set up right now moving forward with getting this study started and look forward to seeing results evolve over the course of the next months. I think because these diseases are really rare, it's hard to predict when we're going to have enough data to take a look at and see what the results look like. As a reminder of the design, it's 14 patients to cohort, so it is going to be an exciting experiment that field of complement research in nephrology has exploded, as you know, and there's a lot of anticipation and expectation of benefit for these patients who have nothing approved.

Thanks so much. You're welcome.

Your next question comes from the line of Chris Raymond from Piper Sandler. Your line is open.

Hey, thanks. Just a couple questions on the commercial side. So you noted today, I think, that more than half of patients new to the drug, new to Orladeo, are switching from injectables. And I think I read that your commentary last quarter was about 60%. I know you're not guiding to 2022, but just kind of can you give us a sense of those, you know, two patient pools, the switchers versus, you know, new to therapy. Can you give us a sense of how you expect that to evolve, you know, thinking out maybe a year from now, two years from now? And then maybe the second question, I think I heard you say to a previous question around discontinuations that you're one year ahead in sort of steady state is around 70%. Do you have a sense now of those patients that discontinue, what's the most common driver? Is it the drug or, you know, efficacy slash, you know, tolerability, or is it more access-related? Thanks.

Hey, Chris, thanks for the questions. First of all, the evolution of the switchings, Yeah, in Q3 we saw it was greater than 50%. It was actually a little closer to 60 than 50. But, you know, we see that trend continuing. And back to the market research that I referenced, doctors see that continuing over the next 12 months. They see patients coming from all the different prophy products and acute only. So eventually we see the trend has been towards prophylaxis in general. More and more of the patients being treated with prophy. It's the best for patients. And we see that number growing to 80% plus, maybe over 90% over the long term. So the longer-term growth will probably come from growing the prophy market, but over the next year we see the same trends of switches from prophy and then the rest being acute only. And some, usually less than 10%, are kind of newly diagnosed patients or newly treated patients that start their therapy on Orla Dale. As far as the 70% retention and the drivers for that, as we said before, the biggest drivers are going to be if some patients do have adverse events, and GI adverse events in particular, we set expectations so patients know that those are likely to go away relatively early in therapy, and that helps. And then the other is just going to be perceived efficacy. No drug is perfect, and no drug is for every patient, so that will be the other big thing. It really has not been access, and that's because we've done a really good job of helping patients access Orladeo, and if the payer doesn't cover it, we give them access anyway if they're doing well on therapy. And so patients and doctors are responding really well to that.

And, Chris, I'd add to what Charlie said at the beginning. I mean, there is still a huge opportunity of patients that are well-controlled on their profi therapy that haven't made the decision to switch yet that we believe – you know, we'll get over time. And, you know, when patients talk to patients, when doctors talk to each other, when, you know, we get more access to them, we think that's going to be a continuous steady flow of new patients onto our drug.

Great. Thank you very much.

Your next question comes from the line of John Wallivan from JMP Securities. Your line is open.

Hey, good morning. Thanks for taking the question, and congrats on all the progress. A couple for Orladeo from me. You mentioned a couple times you expect Orladeo now to be the market leader for HA prophylaxis. I'm wondering if that's primarily supported from the survey you discussed, or is it also trends you're seeing with demand out in the real world? And then, John, you mentioned this also. You're looking to change your peak sales assumptions. I'm wondering where that could land. I think Texira is still expected to be about a billion-dollar product. So if you could discuss kind of how you think that dynamic plays out over time, that would be helpful. Yeah, Charlie.

So thanks, John. On the market leader perspective, what we're seeing is, as I described, really strong and steady growth month over month in patients. So that's the primary thing, what we see in our own internal data, that steady growth. And then the market research just supports that, the fact that physicians see it as well. And we know the market opportunity in these physician groups, and we see the repeat prescribing happening among the physicians. You put that all together with the patient's desire for a once-daily oral to prevent attacks, and that's what drives our outlook on that.

Yeah, and then on, you know, the market leader and where we think the peak will net out, you know, the market leader Charlie's referring to is the most prescribed prophylactic drug, and that's what docs are telling him, and we're seeing the switching in the marketplace and have a high degree of confidence now to say that out loud, and we really believe we have the evidence to back it up. In terms of what that number is, is. It's significantly north of 500, but we're not at a point yet to tell you. But we will be soon. I think the biggest part is how does XUS evolve and how does it contribute to that number?

That's helpful. And just one last one for me. I don't think you've given this out before, but can you tell us what percentage of patients are on free drug? You mentioned the consistent patient ads per month, and it's about 30 days on. So are we expecting a steady flow that just kind of nets out quarter over quarter? But today, can you tell us, is it 10 percent, 25 percent, 40 percent, just in terms so we have a sense of when those patients roll over to paid drug?

Yeah, John. So as of Q3, it's about a third of the patients who are on free drugs. And they, you know, over time we expect more than half of those patients on free drug to move over to paid product. It's not going to happen all at once. It's going to happen as we get additional payer wins. It's going to happen as, you know, a new year starts with government payers. So it won't be, it's not something that's going to happen in Q4, but over time we expect to to get more than half of those patients over. And we're excited about that. It's another opportunity for growth.

Yeah, and a big chunk of the source of those free drug patients are the new patients that his team adds every month. That's very helpful. Thanks for the color, and congrats again. Thanks, John.

Our next question comes from the line of Jessica Fye from J.P. Morgan. Your line is open. You may ask your question.

Hi, this is Daniel for Jessica 5. Thanks for taking our question. With the average new patient receiving paid drug within about 30 days now, should we think of the conversion of patients from unpaid to paid representing less of a tailwind for sales going forward?

So I think, Daniel, so two parts there. One is The fact that patients are getting to paid so quickly gives patients and doctors a lot of confidence. You know, that's something that they worried about, and we're really pleased with the progress there. And then the, you know, what I just mentioned about patients converting from free product to paid product, that's going to happen over time. And it is a tailwind. It's not an instant tailwind, but it's something that we expect to make progress over the coming months, contributing to that steady growth. in patients and revenue going forward.

Yeah, and again, I don't want to sound like a broken record, Daniel, but it's also a function of how many new patients do we add every month, and Charlie's team has done a phenomenal job of that.

Okay, great. And then in terms of cash, following the attempted equity offering earlier in 3Q that didn't go through, and even you have cash run way into 2023, can you talk about how you think about funding for the company going forward?

Yeah, I can take it. So, you know, I think we're in a really strong cash position, right? And I think it's primarily driven by two parts. So the cash on hand that we have, the access to capital through the Ethereum deal, the revenue that we have coming in from Orladeo, calculating how we get to that kind of net cash burn, And then in terms of a future perspective, it's the access to numerous sources of capital. So, you know, I think gone are the days when we'd be solely reliant on equity, and we proved that last December with the debt and the royalty deals that we have multiple other avenues that are available for us to raise. So I feel like we're in a really strong cash position. If and when we do make a raise, you know, we'll make sure it's a strong cost of capital. You referenced the equity raise. that we withdrew in Q3. I mean, that's honestly, unsurprisingly, probably the least attractive at this point in time for us to use from a source of capital perspective.

Great. And then one last question on 9930, maybe for Bill. With this new update for those patients, for the six patients who are C5 inadequate responders, we see change in hemoglobin of plus 2.3 grams per deciliter. Maybe can you elaborate that and frame it in comparison to the R&D update where we saw a change of 2.2 grams per deciliter?

Sure. Thanks for the question. So the way we approached today's update is to think about the endpoints in the pivotal trials and how they're going to be calculated. So specifically for the inadequate responder study, where we'll be randomizing patients who are still anemic despite a C5 inhibitor with a stable dose, to either continue the C5 inhibitor or to take BCX9930, the primary endpoint and the facet fatigue are both measured as change from baseline by looking at the visits from week 12 through 24. So that's 12, 16, 20, and 24. So it's the average of that. So that's the difference to the way we've talked about the data before, which was just whatever the last last treatment visit was compared to baseline. That's the primary difference. The second difference here is that we've had a couple of, you know, we've had some events like the one I described with the development of an unrelated illness which happened to be wood onion hemolytic anemia in one of the subjects and that obviously affected the hemolytic and you can see that in the middle panel in the figures on the bottom row. So they're the key differences. I think that what's important here is that this is what we see in the context of COVID around the world right now. There are literature reports of those type of complications. Obviously, they're just as likely to happen on the control arm as they are on the active arm. So nothing has changed in terms of our enthusiasm and positivity around the ability to show up clear and clinically meaningful difference compared to continuing to see found inhibitors in that study.

One thing I'd add, Daniel, is that the whole intent behind Bill showing you the data the way he did is to tell you that, you know, if we measured – if this was our pivotal study – we would succeed, right? And so, you know, that's why we did calculations based on how the endpoints are calculated in the pivotal studies. So, you know, with six and nine patients, it's incredibly encouraging to see this data and that probability of success in the pivotals is very high.

Great. That makes sense. Congratulations. Thank you again. Thanks, Daniel.

Your next question comes from the line of Brian Abrams from RBC Capital Market. Your line is open.

Hi, good morning. This is Steve on for Brian. Congrats on the progress, and thanks for taking our question. You spoke a bit about the pipeline earlier and the FOP program in particular, but I'm curious if you can share a bit more about your plans for Gallaudet severe moving forward. Thanks.

Yeah, we continue to work with the government. You know that antivirals are an important part of dealing with COVID. COVID doesn't look like it's going to be going away anytime soon, and so a treatment and an antiviral is still important. These programs go at the speed that the government moves them, and so that's where we're at right now, but we're continuing to get funding and continuing to do work to advance that program. Thanks. You're welcome.

Your final question comes from the line of Jenna Wang from Barclays. Your line is open. You may ask your question.

Thank you for taking my question. I have a few regarding Oladayo launch. The first one is you mentioned that, you know, it would be less than 10% patients are newly diagnosed patients in your patient pool. wondering what that number would be, the percentage in the context of overall newly diagnosed patients. And my next question is regarding your guidance. When we look at the guidance, the full queue seems largely flat. Is that due to the conservatism? And then lastly, how's the pricing X U.S. versus U.S.? ?

Charlie, why don't you take the first and the third? I'll take the second, but you can take them both, and then I'll do the last.

Okay, gotcha, gotcha. Okay, hi, Gina, thanks. So as far as the less than 10% newly diagnosed, and I should be specific about that, we don't know if they're all newly diagnosed. We just know that they're newly, to us, they appear to be newly treated with HAE therapy. So it's some patients, we actually expect most of those are patients who are sitting on the sidelines but with an oral or coming forward and now treating their therapy. In the U.S., at least, we think that the newly diagnosed every year. There are patients who come out, but it's a mature market, and that's a relatively small percentage. As far as the price of ex-U.S. versus U.S., it's going to be lower, clearly. But our launch price in, just to give you a sense, our launch price in Germany is 200,000 euros. That's the price that we get to set at launch, not the final price per year. compared to 485,000 U.S. dollars WAC. And then our list price in the U.K. is 133,000 British pounds, and so that will give you a sense. In general, the European price is going to be 50% or less of the U.S. price, but we see the volume opportunity makes it really attractive to us.

Yeah, and with regard to guidance, we feel we're at a point where, you know, when we told you we wouldn't give you guidance until we could accurately guide you, we feel we can now. There is growth in that number, and it's steady growth off of a really nice base. And, you know, this is our first fourth quarter, by the way. It's the holidays. You know, we don't know exactly how the holidays affect, you know, shipments and prescribing and patient visits and the like, and And so, you know, we're factoring that into this as well.

Okay. I'm just wondering, you know, does that mean like in 2022, do you anticipate the main growth driver will be ex-U.S.? And how do you see the contribution ex-U.S. versus U.S. in terms of growth?

Yeah, no, the growth is going to come largely from the U.S. and there will be additional inflection points coming from the sales that will start to heat up XUS. And let me just remind you of what Charlie's doing that will help that. It's the patient-patient direct interactions, those meetings, face-to-face meetings that Charlie said we've started to implement. Those are going to make a big difference. Face-to-face doctor meetings like the conference we're about to go to, doctors talking to each other. They're not even aware because they're not talking to each other about how the launch is going. other than what they're hearing from us. The 96-week data that Helen talked about, we're really just getting going on getting docs to understand that. And then there's switch data that we're going to be sharing at the college meeting that we'll be able to use as well. So all of that is going to have an impact on the trajectory of the U.S. sales going forward. And then the last piece, Charlie's market research has been pretty accurate. Thus far, and he just did another big study, and it says that physicians that are prescribing are going to double their prescribing in the future. So we expect that that will contribute as well. So there's definitely continued growth in the U.S., no doubt about that.

Thank you.

You're welcome.

There are no more phone questions. Mr. Stonehouse, any concluding remarks?

Yeah, thank you. So as Charlie and Helen said, the three of us and the commercial team are heading to New Orleans tomorrow. This is incredibly exciting for us because, you know, it's nearly 12 months since our approval and our PDUFA date, and this is our first, you know, true face-to-face medical meeting. And we're just so excited. Our schedules are packed. We're really looking forward to it. We've got posters. We've got an oral session. We've got sessions with physicians and other meetings. And so we couldn't be more excited to be heading down to New Orleans to our first face-to-face major medical conference. And it's the first time we will actually have a real booth in the exhibit hall. So if you're at the meeting, I would encourage you to stop by and say hello. So as always, thank you for your interest in our company and have a great day.

This concludes today's conference call. You may now disconnect. Thank you.