Esperion Therapeutics, Inc.

Ladies and gentlemen, thank you for standing by and welcome. At this time, all participants are in a listen-only mode. Following the presentation, there will be a question and answer session. Please be advised that today's conference may be recorded. I would now like to hand the conference over to Tiffany Aldrich, Associate Director, Corporate Communications at Asperion. Please go ahead, Tiffany.

Thank you. Good morning and welcome to Experion's first quarter 2023 earnings conference call. I want to remind callers that the information discussed on the call today is covered under the safe harbor provisions of the Private Securities Litigation Reform Act. I caution listeners that management will be making forward-looking statements. Actual results could differ materially from those stated or implied by our forward-looking statements due to risks and uncertainties associated with the business. These forward-looking statements are qualified in their entirety by the cautionary statements contained in today's press release, presentation, and our SEC filings. The content of this conference call contains time-sensitive information that is accurate only as of the date of this live broadcast, May 9, 2023. We undertake no obligation to revise or update any forward-looking statements to reflect events or circumstances after the date of this conference call and webcast. As a reminder, this conference call and webcast are being recorded and archived. We issued a press release this morning detailing the contents of today's call. A copy can be found at experian.com within the Investors and Media section. With us today are Sheldon Koenig, President and CEO, Ben Halliday, Chief Financial Officer, Dr. Joanne Foody, Chief Medical Officer, Eric Warren, Chief Commercial Officer, and D.J. Swartz, Chief Strategy Officer. We will begin with prepared comments and then open the call for your questions. Following today's call, the team will be available for follow-up questions. I'll now turn the call over to Sheldon for some prepared remarks. Sheldon?

Thank you, Tiffany, and good morning, everyone. Thank you for joining us today to review our first quarter results and significant recent achievements. We reported revenue of $24.3 million, or growth of 29% year over year. Retail prescription equivalents grew by 15% year over year, and new-to-brand prescriptions grew by 56% compared to the prior quarter. It's clear that we are off to a very strong start in 2023. Let me now share some of the highlights from the quarter that are driving this positive momentum. As you know, we recently presented impressive clinically meaningful cardiovascular risk reduction results from our landmark clear outcomes trial at ACC in March, as well as published these broadly disseminated data in the prestigious New England Journal of Medicine. This was a major accomplishment for Aspirion that was years in the making, and we're very proud of the team for their tireless work in achieving this milestone. I'll further discuss these positive results in a moment. Our entire organization is continuing to work expeditiously following our data announcement, and we remain on track for regulatory submissions to both the U.S. FDA and the European Medicines Agency in the first half of this year. Once we file, there's typically a 10-month review period, so our expectation is for the label change to become effective in the first half of 2024. As a reminder, our sales reps are prohibited from mentioning anything beyond the current label, so we expect the label change to have a significant and positive impact on demand for our drugs. New-to-brand prescriptions spiked 88% in the four weeks following our ACC data presentation, and Eric will provide more color from the field to explain why we are seeing this trend so quickly and ahead of our initial expectations. We are also making swift progress in Europe. The International Lipid Expert Panel has updated the guidelines and now recommends benpitoic acid ahead of PCSK9 inhibitors, either alone or in combination with the Zetamide. Next, our European partner has demonstrated persistent growth for the Nexlital and Nexlizet franchise in that geography. Our European commercialization of benpitoic acid continues to expand, and we are proud to report that reimbursement of the drug was recently approved in Italy, and that marketing approval was obtained in Turkey. Next, we have launched a new scientific website targeting the scientific and medical communities to further educate these important stakeholders about the benefits of NexLatal and NexLivet. Lastly, we recently announced a commercial partnership with Curex Pharmaceuticals. This partnership will enable their 72 reps to promote NexLatal and NexLivet with primary care providers, effectively doubling our promotional footprint. We expect their reps to be fully trained and in the field by July. Let me now walk you through some key business accomplishments. As you all know, ClearOut comes with a landmark trial unprecedented in its scope, which assessed the ability of benpidoic acid to improve outcomes in individuals unable to maximize or tolerate a statin. We focused on a significant underserved population unable to achieve their LDL cholesterol goals with current therapy. It was conducted in nearly 14,000 patients in 32 countries, inclusive of approximately 50% women, which is an important and differentiating component compared to other cardiovascular trials, and which generated a round of applause from the physician audience at ACC, as cardiovascular disease is the number one killer of women. I want to take a moment to reiterate the high-level findings from the CLEAR trial because they are so important. A cardiovascular risk reduction of more than 20%, including a reduction in non-fatal heart attacks, this is a significant outcome, not only for Aspirin, but more importantly for patients. Our drugs are literally saving lives. We will present additional analysis from this trial at multiple medical meetings throughout the year, which we expect will further raise awareness amongst prescribers. We saw significant coverage and excitement about benpozoic acids following the announcement of clear outcomes results, not only from the medical community, but also from the media and the general public. This data has been so impactful that it has been covered in over 500 print, trade, and broadcast media pieces garnering over 1 billion total impressions, which is equivalent to us getting approximately $200 million in paid advertising. We're thrilled to see so much enthusiasm for our study and are proud to be at the forefront of the discussion about reaching cholesterol goals. We aim to continue the conversation while increasing awareness about the importance of lowering LDL cholesterol. With that, I'll now turn it over to Eric Warren, our Chief Commercial Officer, for a commercial perspective.

Thanks, Sheldon. I'm incredibly excited about the performance of Nexplatel and Nexcloset in the first quarter. We are just scratching the surface on the true opportunity for these products. Coming out of ACC, we surveyed approximately 100 healthcare practitioners to assess their reaction to the results of the CLEAR outcome study. An overwhelming 98% had a positive or highly positive reaction, reinforcing the clinical importance of these data. Even without the ability for our commercial teams to promote these data, we saw significant growth in multiple key performance indicators in Q1. I'll highlight two. Number one, an 88% increase in new-to-brand prescriptions for the four weeks following ACC. And number two, approximately 1,500 new riders of NexLatal and NexLisette during that same time period. We are extremely proud of these results and believe that it is only the beginning of the significant growth opportunity that lies ahead. To put further context around these trends, we believe that the growth is driven by significant prescriber engagement and conviction in the benefits of Nexplatel and NexLisette. The commercial team is doing an outstanding job executing our current positioning, which is, as a reminder, for those patients with established cardiovascular disease on maximally tolerated statins and not at their LDL-C goal. At the same time, the team is preparing for the significant changes that will come to our positioning post-incorporation of the clear outcomes data into the prescribing information. Shedding the statin limitations and adding high risk primary prevention patients is expected to not only dramatically increase the number of patients that will benefit from Nexatol and Nexlozet, but solidify their place as the clear next step after statins and the first non-statin LDL-C lowering therapies to demonstrate outcomes benefits in a combination of high-risk primary and secondary prevention patients. Multiple commercial activities are being implemented throughout 2023 to build upon the momentum we saw in Q1 and to prepare for our full launch in the first half of 2024. From revised segmentation to targeted consumer activities, Salesforce scaling, and creative partnerships that expand PCP reach like the one we just signed with Curex that Sheldon mentioned. The team is leaving no stone unturned to enable Nexplatel and Nexplazet to reach their full commercial potential. I'll turn it over to Ben to review the detailed financials. Thank you, Eric.

Earlier today, we issued a press release containing our financial results for the first quarter of 2023, which is available on the investor page of our website. Please note that unless otherwise specified, my comments reflect results for the first quarter ended March 31, 2023. U.S. product revenue was $17 million, up approximately 27% year-over-year. Retail prescription equivalents for the first quarter increased 15% year-over-year and 7% quarter-over-quarter, reflecting very positive reception of the clear outcomes data. Our European partner continues to report strong Nalemdo and Nustendi growth in their European territories. A total of 97,000 patients have now been treated in Europe through February of 2023. As of March 31st, 2023, cash equivalents and investment securities available for sale totaled $162.3 million compared with $166.9 million on December 31st, 2022. This cash includes the recent $56 million raised in a registered direct offering in March before deducting placement agent fees and related offering expenses. Collaboration revenue, which includes combined royalty and partner revenue, was $7.3 million, an increase of 33% year-over-year. Finally, total revenue for the first quarter ended March 31, 2023, was $24.3 million, an increase of 29% year-over-year, turning to expenses. R&D expenses were $31.4 million, an increase of 29% year-over-year. The increase is primarily related to costs associated with our clear outcomes trial, including closeout activities, our ACC presentation, and regulatory submission preparation as previously guided. SG&A expenses were $29.9 million, a decrease of 2% year-over-year, reflecting our commitment to expense management while continuing to support the momentum seen following our ACC presentations. Our recent deal with CURAX is a great example of how we can expand our commercial presence without significantly increasing our burn rate. We still expect full-year 2023 operating expenses to be approximately $225 million to $245 million, and we are tracking in line with that guidance. This total includes $25 million in non-cash expense related to stock compensation and can be further broken out as $100 to $110 million in R&D expense and $125 to $135 million in SG&A expense. I'll note that our operating expenses are expected to be first half loaded, reflecting costs associated with the closure of our clear outcomes trial ACC presentation regulatory filing submission work in both the U.S. and Europe, as previously mentioned. We expect second quarter expenses to be relatively in line with first quarter and then to moderate substantially in the second half of the year. Let me now hand it back over to you, Sheldon.

Thank you, Ben. Let me share a brief corporate update. First, we raised nearly $56 million in capital at the end of March, which extends our cash runway and enables us to fuel continued growth. Second, we announced that we'll be holding our annual shareholder meeting later this month on May 25th. And third, we filed an amended complaint last week with the Southern District of New York with regard to European partner milestone payments, which we believe we are owed. This amended complaint discloses new evidence we believe further supports our position We feel confident in our legal standing and will keep you posted as things progress. Nexapal and Nexavet are well positioned for significant growth in a large market, and our data have driven awareness and acceptance on a global scale. We are on track to soon file for a broad cardiovascular risk reduction label, and we plan to be extremely visible at upcoming medical congresses and in top-tier journals. We are thrilled about the initial increases we've seen across selling metrics following sharing and clear outcomes at ACC. We are implementing our strategic plan to capitalize on that momentum throughout 2023 for the upcoming label update and the full-scale promotion associated with it as we unlock the blockbuster potential of Nexlipol and Nexlizet. I want to make something clear. After a statin, NextLatal and NextLisette are next. Thank you for your interest in Experion and for joining today.

Operator, we are now ready for Q&A.

Thank you. To ask a question, please press star 1-1 on your telephone and wait for your name to be announced. To withdraw your question, please press star 1-1 again. One moment while we compile the Q&A roster. Our first question will come from the line of Dennis Ding with Jefferies. Your line is open.

Thanks. Good morning, and thanks for taking my questions. Congratulations on all the progress. So two questions for me. Number one, on the Daiichi milestone, you had previously mentioned you'll be seeking around $300 million in value, and that can obviously come in a variety of different ways. Okay. Can you give investors some clarity on what you mean by this and what factors are you taking into account when it comes to pursuing a near versus longer term resolution? And then my second question is around OpEx. Can you remind us how much flexibility do you have on OpEx on either SG&A and R&D? And if there is some level of conservatism baked into your guidance given your CURAC's co-promotion agreement. Thank you.

Hi, Dennis. First of all, thank you so much for your question. So I want to be clear as it relates to the Daiichi Sankyo Milestone. Our goal is to secure the full $300 million in value for our shareholders. And that's what we will be pursuing. That's what we have always publicly stated. Um, and I think it's also important to, again, recognize the fact that the $300 million milestone is due upon our label change, which we expect to occur in the first half of 2024. So, um, I know you used the word value. Um, we are looking to seek the full $300 million payment. And, you know, we'll just leave it, leave it at that.

Yeah, Dennis, this is Ben. I'll touch on OpEx. So as far as flexibility, I mean, let me be clear. We always have and always will meaningfully manage the expenses of this company. With R&D, yes, we have room to change and toggle up and down. But with SG&A, we want to make sure that we're funding the great momentum that we saw post-ACC, and we don't want to derail that. So We will make sure that we're investing in the right areas, but we're going to walk the fine line of managing our burn rate as well as trying to keep that momentum going. But to answer your question, yes, there is room to scale up and scale down accordingly.

Thank you.

Thank you. One moment for our next question. And that will come from the line of Serge Bellinger with Needham. Your line is open.

Hi, good morning. Thanks for taking your questions. Sheldon, the first one is on the legal proceedings with your European partner. What's the next potential development on that front? And then maybe can you talk about the potential range of timelines for resolution here and Secondly, you talked about additional data presentations over the rest of the year. Maybe just give us a preview of what those data could be. Thanks.

Great. Hey, Serge. Good to hear you this morning. So as it relates to label negotiations and preparing for both the U.S. and also the EMEA, which would be the European submission, Everything remains on track. In the US, we remain on track to file before this half of the year is over. And the same is true for Europe and working with our European partners, Daiichi Sankyo. So all that work, there is no change in any of the work or the submission timelines. Everything is on time. I would actually say even a bit ahead of schedule, you may recall we even talked about accelerating timelines, so we are in good shape there. Regarding future presentations and data, we will keep everyone updated, but there are some important meetings that will occur before the end of June, and we will be continuing to show data not only at those meetings, but throughout the year as we go into even the fall, if you think about the European Society of Cardiology, And then after that, the American Heart Association. So stay tuned. We have some, again, really exciting data. As you know, this was a very large study and showed fantastic data that's important to both physicians, patients, and I'll add one more, all healthcare providers.

Thank you. One moment for our next question. And that will come from the line of Jessica Fye with J.P. Morgan. Your line is open.

Hey, guys. Good morning. Thanks for taking my questions. A few. First, can you elaborate on the economics of the CARES Act agreement? Second, can you talk about your expectations for the timing for inclusion in U.S. guidelines? fall of this year possible?

And lastly, what do you see as the current cash runway after the recent raise? Thank you.

Hey, Jess. It's Eric Warren. I'll take the first one on the Curex financials. So we believe that this Curex arrangement is a wonderful win-win, not only for the companies but for patients. So we did provide CUREx with a small upfront, but the majority of the revenue will come as they generate new prescriptions in the target universe that they're responsible for, and that is a unique group of primary care practitioners.

Good morning, Jeff. This is Joanne. As we think about the incorporation of the data from CLEAR into guidelines, we anticipate that there would likely be updates to U.S. guidelines. presumably the fall, based on the strength of the data. As you've already seen, we've had guidances globally already updating their statements and positioning either Nexotal or Nexoset after statins and before PDSK9s. And we would anticipate, based on the strength of the clear outcome, particularly with data in both primary and secondary prevention, that U.S. guidelines would follow, too, presumably in the fall.

Yeah, Jess, this is Ben. On cash runway, I think after this last fundraise, as well as some of the tailwinds we've seen after ACC, I think our cash runway now goes to about mid-2024. Great.

Thanks. And just as a follow-up, what are the timelines we should expect for the litigation with DSE, and when can we expect clarity?

Yeah. So, Jeff, DSC, you know, as you know, last week we filed a new complaint. They have until June the 19th to respond to that complaint. Just keep in mind that the milestone payment is due upon our label change, which we expect to occur in the first half of 2024. So, even filing a new complaint, that does not delay anything. um you know after that you know obviously we filed a new complaint and you know we plan to ask the court to hold a trial in um uh early 2024 and that's the standard timeline for these types of of cases again keep in mind the milestone payment is not due until early 2024. great thank you thank you one moment for our next question

And that will come from the line of Jason Zemanski with Bank of America. Your line is open.

Good morning. Thank you so much for taking our questions and let me echo my congratulations on the progress. Look, I recognize there are some sensitivities regarding the ongoing legal dispute, but to the extent that you can comment, is there any ongoing open active dialogue between you and your European partner? You know, are there any negotiations that, you know, in terms of potential near-term settlement you know whatever that looks like and then regarding the correct deal when when do you expect that to to hit should we expect the near-term impact or is that going to kind of come on more steadily over the course of the year thank you so much

Hey, Jason. Uh, first of all, thank you for the congratulations. So as it relates to commenting on ongoing negotiations, discussions, et cetera, um, unfortunately we cannot comment on this as, uh, I'm sure you can appreciate. I will say though, that keep in mind, as I said earlier, it's business as usual though, with our partners as well, um, as it relates to working on the label, uh, our joint commercialization sub teams, et cetera. but we cannot comment on anything regarding the litigation as it currently stands. As it relates to CURAX, so the CURAX folks, so the deal is done. We're in the midst of preparing them now to begin training, which is something that they will do in their free time. Again, just be reminded there's about 72 of these folks across the country, and we see them engaging with customers with our products on July the 1st. And I would go as far as to say that, you know, we think that, you know, we believe that we'll have, um, as we've said previously, we're effectively doubling our sales force. So, um, we see. You know, having meaningful results, um, as they get started and we'll continue to update you as we go through the next few months. So we're very excited about the partnership and, um, it's really going to help us again, continue the momentum that we generated from ACC.

Great. Thanks for the color.

Thank you. One moment for our next question. And today's final question will come from the line of Troy Langford with TD Cowen. Your line is open.

Hi. Thanks for taking my question and congrats on all the progress. Just one quick commercial question. Can you provide a little bit of additional color on the feedback from physicians that have tried zempatoic acids since the data at ACC? Have physicians seemed to care at all about the specific level of risk reduction seen in the Clear Outcome Study, or have they mainly just seemed happy that it showed a positive result?

Hi, Troy. It's Eric. Yes, the physician reaction to our product in general has been fantastic. and that's been before ACC as well as ACC. ACC just opened the eyes to many physicians that were waiting for outcomes data. As a reminder, we're not able to talk about those data, but I have done lots of market research projects where physicians are incredibly positive about these data. So they care about the presence of data, but they actually care about the the actual data that we generated from Clear Outcomes. So they're impressed with the data, and we've already seen some of the impact. And again, that's pre-commercialization. And Joanne?

And Troy, thank you again for the question. This is Joanne. I think as we look at the very highest level of key opinion leaders, scientific leaders, particularly in the cardiovascular community, that these data have had a profound impact. not only on their awareness, but their ability to have a new tool to address cardiovascular risk. So excited about the oral, excited about the differentiation in the study, not only lowering LDL cholesterol, but also protein. And its statin-like properties, consistency with statin, and its impact on outcomes have really been looked at very favorably and has really driven awareness, particularly in the cardiovascular field.

And Joanne, I'll just add one more comment. Troy, this is a question that, of course, gets us excited because I was actually just at a dinner with a few physicians in Washington, DC. And what they stated, and we've heard this numerous times, is that this drug is a game changer. This drug for patients who can only take a maximum tolerated dose of a statin but still need to get to goal Or for patients who cannot take a statin and it's documented, they have something out they can turn to. So I've heard the word game changer, you know, real life discussions numerous times. Again, very exciting. The study obviously unlocked a lot of potential for us, created a tremendous amount of awareness, as we stated in our comments earlier this morning. So again, thank you.

Okay, great. And I actually have just one quick follow-up if I can. Have you all seen a shift in the type of prescribers who have tried to use benpidoic acid or where the prescribers have tried to use the product at all in the treatment paradigm?

It's pretty consistent. We're still seeing about 60% of our prescriptions come from primary care.

Okay, great.

Thank you. And we do have time for one final question. And that will come from the line of Judah Frommer with Credit Suisse. Your line is open.

Hi, good morning, guys. Thanks for squeezing me in. I apologize if we miss this, but do you have any updates on how kind of post-ATC payer conversations have been going? Do you get the sense that the ATC data was enough or that they might be waiting for label change? And how are, I guess, the existing reimbursement challenges changing? still affecting Scripps, and how could you see those potentially being lifted as the reimbursement widens? Thanks.

Yeah, thank you, Judith. Coast ACC, excuse me, we have presented the CVOT data to probably over 12 of the largest payers that account for a half of all payer lives. The receptiveness has been incredibly positive. We have commitment to actually look at the UM criteria prior to label. And where we're really excited about is in the Medicare, you know, it's 34% coverage now, and we've had that commitment to take that to almost 70%, and we think that that could possibly happen before the end of the year, even before label change. The prior authorizations continue to improve. We see an overall improvement of rates growing. The three payers, probably with the largest, CVS, ESI, and Optum, we're probably seeing approval rates 15% and higher at this point.

BJ, can I just add one more thing, and that is, hey Judah, is that we don't even have the label yet, and we see our reimbursement rates, both for commercial and from a Medicare basis, very similar to that of what PCSK9 has. So I think that gives you a good idea of the success that we're seeing as it relates to the detail that BJ provided.

Great. Thank you.

Thank you. Thank you all for participating. This concludes today's program. You may now disconnect. Have a wonderful day. Thank you. Thank you. Bye. Thank you. Ladies and gentlemen, thank you for standing by and welcome. At this time, all participants are in a listen-only mode. Following the presentation, there will be a question and answer session. Please be advised that today's conference may be recorded. I would now like to hand the conference over to Tiffany Aldrich, Associate Director, Corporate Communications at Asperion. Please go ahead, Tiffany.

Thank you. Good morning and welcome to Experion's first quarter 2023 earnings conference call. I want to remind callers that the information discussed on the call today is covered under the safe harbor provisions of the Private Securities Litigation Reform Act. I caution listeners that management will be making forward-looking statements. Actual results could differ materially from those stated or implied by our forward-looking statements due to risks and uncertainties associated with the business. These forward-looking statements are qualified in their entirety by the cautionary statements contained in today's press release, presentation, and our SEC filings. The content of this conference call contains time-sensitive information that is accurate only as of the date of this live broadcast, May 9, 2023. We undertake no obligation to revise or update any forward-looking statements to reflect events or circumstances after the date of this conference call and webcast. As a reminder, this conference call and webcast are being recorded and archived. We issued a press release this morning detailing the contents of today's call. A copy can be found at experian.com within the Investors and Media section. With us today are Sheldon Koenig, President and CEO, Ben Halliday, Chief Financial Officer, Dr. Joanne Foody, Chief Medical Officer, Eric Warren, Chief Commercial Officer, and B.J. Swartz, Chief Strategy Officer. We will begin with prepared comments and then open the call for your questions. Following today's call, the team will be available for follow-up questions. I'll now turn the call over to Sheldon for some prepared remarks. Sheldon?

Thank you, Tiffany, and good morning, everyone. Thank you for joining us today to review our first quarter results and significant recent achievements. We reported revenue of $24.3 million, or growth of 29% year over year. Retail prescription equivalents grew by 15% year over year, and new-to-brand prescriptions grew by 56% compared to the prior quarter. It's clear that we are off to a very strong start in 2023. Let me now share some of the highlights from the quarter that are driving this positive momentum. As you know, we recently presented impressive clinically meaningful cardiovascular risk reduction results from our landmark clear outcomes trial at ACC in March, as well as published these broadly disseminated data in the prestigious New England Journal of Medicine. This was a major accomplishment for Aspirion that was years in the making, and we're very proud of the team for their tireless work in achieving this milestone. I'll further discuss these positive results in a moment. Our entire organization is continuing to work expeditiously following our data announcement, and we remain on track for regulatory submissions to both the U.S. FDA and the European Medicines Agency in the first half of this year. Once we file, there's typically a 10-month review period, so our expectation is for the label change to become effective in the first half of 2024. As a reminder, our sales reps are prohibited from mentioning anything beyond the current label, so we expect the label change to have a significant and positive impact on demand for our drugs. New-to-brand prescriptions spiked 88% in the four weeks following our ACC data presentation, and Eric will provide more color from the field to explain why we are seeing this trend so quickly and ahead of our initial expectations. We are also making swift progress in Europe. The International Lipid Explorer Panel has updated the guidelines and now recommends benpitoic acid ahead of PCSK9 inhibitors, either alone or in combination with the Zetamide. Next, our European partner has demonstrated persistent growth for the Nexlatal and NexlaZet franchise in that geography. Our European commercialization of benpitoic acid continues to expand, and we are proud to report that reimbursement of the drug was recently approved in Italy, and that marketing approval was obtained in Turkey. Next, we have launched a new scientific website targeting the scientific and medical communities to further educate these important stakeholders about the benefits of Nexlatal and Nexlavet. Lastly, we recently announced a commercial partnership with Curex Pharmaceuticals. This partnership will enable their 72 reps to promote Nexlital and Nexlivet with primary care providers, effectively doubling our promotional footprint. We expect their reps to be fully trained and in the field by July. Let me now walk you through some key business accomplishments. As you all know, ClearOut comes with a landmark trial, unprecedented in its scope, which assessed the ability of benpidoic acid to improve outcomes in individuals unable to maximize or tolerate a statin. We focused on a significant underserved population unable to achieve their LDL cholesterol goals with current therapy. It was conducted in nearly 14,000 patients in 32 countries, inclusive of approximately 50% women, which is an important and differentiating component compared to other cardiovascular trials, and which generated a round of applause from the physician audience at ACC. as cardiovascular disease is the number one killer of women. I want to take a moment to reiterate the high-level findings from the CLEAR trial because they are so important. A cardiovascular risk reduction of more than 20%, including a reduction in non-fatal heart attacks, this is a significant outcome, not only for Aspirin, but more importantly for patients. Our drugs are literally saving lives. We will present additional analysis from this trial at multiple medical meetings throughout the year, which we expect will further raise awareness amongst prescribers. We saw significant coverage and excitement about benpozoic acids following the announcement of clear outcomes results, not only from the medical community, but also from the media and the general public. This data has been so impactful that it has been covered in over 500 print, trade, and broadcast media pieces garnering over 1 billion total impressions, which is equivalent to us getting approximately $200 million in paid advertising. We're thrilled to see so much enthusiasm for our study and are proud to be at the forefront of the discussion about reaching cholesterol goals. We need to continue the conversation while increasing awareness about the importance of lowering LDL cholesterol. With that, I'll now turn it over to Eric Warren, our Chief Commercial Officer, for a commercial perspective.

Thanks, Sheldon. I'm incredibly excited about the performance of Nexplatel and Nexcloset in the first quarter. We are just scratching the surface on the true opportunity for these products. Coming out of ACC, we surveyed approximately 100 healthcare practitioners to assess their reaction to the results of the CLEAR outcome study. An overwhelming 98% had a positive or highly positive reaction, reinforcing the clinical importance of these data. Even without the ability for our commercial teams to promote these data, we saw significant growth in multiple key performance indicators in Q1. I'll highlight two. Number one, an 88% increase in new-to-brand prescriptions for the four weeks following ACC. And number two, approximately 1,500 new riders of Nexlatal and Nexlazet during that same time period. We are extremely proud of these results and believe that it is only the beginning of the significant growth opportunity that lies ahead. To put further context around these trends, we believe that the growth is driven by significant prescriber engagement and conviction in the benefits of Nexplatel and Nexplizet. The commercial team is doing an outstanding job executing our current positioning, which is, as a reminder, for those patients with established cardiovascular disease on maximally tolerated statins and not at their LDL-C goal. At the same time, the team is preparing for the significant changes that will come to our positioning post-incorporation of the clear outcomes data into the prescribing information. Shedding the statin limitations and adding high risk primary prevention patients is expected to not only dramatically increase the number of patients that will benefit from Nexatol and Nexlozet, but solidify their place as the clear next step after statins and the first non-statin LDL-C lowering therapies to demonstrate outcomes benefits in a combination of high-risk primary and secondary prevention patients. Multiple commercial activities are being implemented throughout 2023 to build upon the momentum we saw in Q1 and to prepare for our full launch in the first half of 2024. From revised segmentation to targeted consumer activities, Salesforce scaling, and creative partnerships that expand PCP reach like the one we just signed with Curex that Sheldon mentioned. The team is leaving no stone unturned to enable Nexplatel and Nexplizet to reach their full commercial potential. I'll turn it over to Ben to review the detailed financials.

Thank you, Eric.

Earlier today, we issued a press release containing our financial results for the first quarter 2023, which is available on the investor page of our website. Please note that unless otherwise specified, my comments reflect results for the first quarter ended March 31, 2023. U.S. product revenue was $17 million, up approximately 27% year-over-year. Retail prescription equivalents for the first quarter increased 15% year-over-year and 7% quarter-over-quarter, reflecting very positive reception of the clear outcomes data. Our European partner continues to report strong Nalemdo and Nustendi growth in their European territories. A total of 97,000 patients have now been treated in Europe through February of 2023. As of March 31st, 2023, cash equivalents and investment securities available for sale totaled $162.3 million compared with $166.9 million on December 31st, 2022. This cash includes the recent $56 million raised in a registered direct offering in March before deducting placement agent fees and related offering expenses. Collaboration revenue, which includes combined royalty and partner revenue, was $7.3 million, an increase of 33% year-over-year. Finally, total revenue for the first quarter ended March 31, 2023, was $24.3 million, an increase of 29% year-over-year, turning to expenses. R&D expenses were $31.4 million, an increase of 29% year-over-year. The increase is primarily related to costs associated with our clear outcomes trial, including closeout activities, our ACC presentation, and regulatory submission preparation as previously guided. SG&A expenses were $29.9 million, a decrease of 2% year-over-year, reflecting our commitment to expense management while continuing to support the momentum seen following our ACC presentation. Our recent deal with CURAX is a great example of how we can expand our commercial presence without significantly increasing our burn rate. We still expect full-year 2023 operating expenses to be approximately $225 million to $245 million, and we are tracking in line with that guidance. This total includes $25 million in non-cash expense related to stock compensation and can be further broken out as $100 to $110 million in R&D expense and $125 to $135 million in SG&A expense. I'll note that our operating expenses are expected to be first half loaded, reflecting costs associated with the closure of our clear outcomes trial ACC presentation regulatory filing submission work in both the U.S. and Europe, as previously mentioned. We expect second quarter expenses to be relatively in line with first quarter and then to moderate substantially in the second half of the year. Let me now hand it back over to you, Sheldon.

Thank you, Ben. Let me share a brief corporate update. First, we raised nearly $56 million in capital at the end of March, which extends our cash runway and enables us to fuel continued growth. Second, we announced that we'll be holding our annual shareholder meeting later this month on May 25th. And third, we filed an amended complaint last week with the Southern District of New York with regard to European partner milestone payments, which we believe we are owed. This amended complaint discloses new evidence we believe further supports our position We feel confident in our legal standing and will keep you posted as things progress. Nexapal and NexLivet are well positioned for significant growth in a large market, and our data have driven awareness and acceptance on a global scale. We are on track to soon file for a broad cardiovascular risk reduction label, and we plan to be extremely visible at upcoming medical congresses and in top-tier journals. We are thrilled about the initial increases we've seen across selling metrics following sharing and clear outcomes at ACC. We are implementing our strategic plan to capitalize on that momentum throughout 2023 for the upcoming label update and the full-scale promotion associated with it as we unlock the blockbuster potential of Nexlipol and Nexlizet. I want to make something clear. After a statin, NextLatal and NextLizette are next. Thank you for your interest in Experion and for joining today.

Operator, we are now ready for Q&A.

Thank you. To ask a question, please press star 1 1 on your telephone and wait for your name to be announced. To withdraw your question, please press star 1 1 again. One moment while we compile the Q&A roster. Our first question will come from the line of Dennis Ding with Jefferies. Your line is open.

Thanks. Good morning, and thanks for taking my questions. Congratulations on all the progress. So two questions for me. Number one, on the Daiichi milestone, you had previously mentioned you'll be seeking around $300 million in value, and that can obviously come in a variety of different ways. Can you give investors some clarity on what you mean by this and what factors are you taking into account when it comes to pursuing a near versus longer term resolution? And then my second question is around OpEx. Can you remind us how much flexibility do you have on OpEx on either SG&A and R&D? And if there is some level of conservatism baked into your guidance given your CURAC's co-promotion agreement. Thank you.

Hi, Dennis. First of all, thank you so much for your question. So I want to be clear as it relates to the Daiichi Sankyo Milestone. Our goal is to secure the full $300 million in value for our shareholders. And that's what we will be pursuing. That's what we have always publicly stated. Um, and I think it's also important to, again, recognize the fact that the $300 million milestone is due upon our label change, which we expect to occur in the first half of 2024. So, um, I know you used the word value. Um, we are looking to seek the full $300 million payment and, you know, we'll just leave it, leave it at that.

Yeah, Dennis, this is Ben. I'll touch on OpEx. So as far as flexibility, I mean, let me be clear. We always have and always will meaningfully manage the expenses of this company. With R&D, yes, we have room to change and toggle up and down. But with SG&A, we want to make sure that we're funding the great momentum that we saw post-ACC, and we don't want to derail that. We will make sure that we're investing in the right areas, but we're going to walk the fine line of managing our burn rate as well as trying to keep that momentum going. But to answer your question, yes, there is room to scale up and scale down accordingly.

Thank you.

Thank you. One moment for our next question. And that will come from the line of Serge Bellinger with Needham. Your line is open.

Hi, good morning. Thanks for taking your questions. Sheldon, the first one is on the legal proceedings with your team partner. What's the next potential development on that front? And then maybe can you talk about the potential range of timelines for resolution here and Secondly, you talked about additional data presentations over the rest of the year. Maybe just give us a preview of what those data could be. Thanks.

Great. Hey, Serge. Good to hear you this morning. So, as it relates to label negotiations and preparing for both the U.S. and also the EMEA, which would be the European submission, Everything remains on track. In the US, we remain on track to file before this half of the year is over. And the same is true for Europe and working with our European partners, Daiichi Sankyo. So all that work, there is no change in any of the work or the submission timelines. Everything is on time. I would actually say even a bit ahead of schedule. You may recall we even talked about accelerating timelines, so we are in good shape there. Regarding future presentations and data, we will keep everyone updated, but there are some important meetings that will occur before the end of June, and we will be continuing to show data not only at those meetings, but throughout the year as we go into even the fall, if you think about the European Society of Cardiology, And then after that, the American Heart Association. So stay tuned. We have some, again, really exciting data. As you know, this was a very large study and showed fantastic data that's important to both physicians, patients, and I'll add one more, all healthcare providers.

Thank you. One moment for our next question. And that will come from the line of Jessica Fye with JPMorgan. Your line is open.

Hey, guys. Good morning. Thanks for taking my questions. A few. First, can you elaborate on the economics of the CUREx agreement? Second, can you talk about your expectations for the timing for inclusion in U.S. guidelines? fall of this year possible?

And lastly, what do you see as the current cash runway after the recent raise? Thank you.

Hey, Jess. It's Eric Warren. I'll take the first one on the Curex financials. So we believe that this Curex arrangement is a wonderful win-win, not only for the companies but for patients. So we did provide Curex with a small upfront, but the majority of the revenue will come as they generate new prescriptions in the target universe that they're responsible for, and that is a unique group of primary care practitioners.

Good morning, Jeff. This is Joanne. As we think about the incorporation of the data from CLEAR into guidelines, we anticipate that there would likely be updates to U.S. guidelines. presumably the fall, based on the strength of the data. As you've already seen, we've had guidances globally already updating their statements and positioning either Nexotal or Nexoset after statins and before PDSK9s. And we would anticipate, based on the strength of the clear outcome, particularly with data in both primary and secondary prevention, that U.S. guidelines would follow, too, presumably in the fall.

Yeah, Jess, this is Ben. On cash runway, I think after this last fundraise, as well as some of the tailwinds we've seen after ACC, I think our cash runway now goes to about mid-2024. Great.

Thanks. And just as a follow-up, what are the timelines we should expect for the litigation with DSC, and when can we expect clarity?

Yeah. So, Jess, DSC, you know, as you know, last week we filed a new complaint. They have until June the 19th to respond to that complaint. Just keep in mind that the milestone payment is due upon our label change, which we expect to occur in the first half of 2024. So, even filing new complaints, that does not delay anything. So, Um, you know, after that, you know, obviously we filed a new complaint and, you know, we plan to ask the court to hold a trial in, um, uh, early 2024. And that's the standard timeline for these types of cases. Again, keep in mind the milestone payment is not due until early 2024. Great. Thank you.

Thank you. One moment for our next question. And that will come from the line of Jason Zemanski with Bank of America. Your line is open.

Good morning. Thank you so much for taking our questions and let me echo my congratulations on the progress. Look, I recognize there are some sensitivities regarding the ongoing legal dispute, but to the extent that you can comment, is there any ongoing open active dialogue between you and your European partner? You know, are there any negotiations that, you know, in terms of potential near-term settlement, you know, whatever that looks like. And then regarding the correct deal, when do you expect that to hit? Should we expect the near-term impact, or is that going to kind of come on more steadily over the course of the year? Thank you so much.

Hey, Jason. Uh, first of all, thank you for the congratulations. So as it relates to commenting on ongoing negotiations, discussions, et cetera, um, unfortunately we cannot comment on this as, uh, I'm sure you can appreciate. I will say though, that keep in mind, as I said earlier, it's business as usual though, with our partners as well, um, as it relates to working on the label, uh, our joint commercialization sub teams, et cetera. But we cannot comment on anything regarding the litigation as it currently stands. As it relates to CURAC, so the CURAC folks, so the deal is done. We're in the midst of preparing them now to begin training, which is something that they will do in their free time. Again, just be reminded there's about 72 of these folks across the country. And we see them engaging with customers with our products on July the 1st. And I would go as far as to say that, you know, we think that, you know, we believe that we'll have, um, as we've said previously, we're effectively doubling our Salesforce. So, um, we see. You know, having meaningful results, um, as they get started and we'll continue to update you as we go through the next few months. So we're very excited about the partnership and, um, it's really going to help us again, continue the momentum that we generated from ACC.

Great. Thanks for the color.

Thank you. One moment for our next question. And today's final question will come from the line of Troy Langford with TD Cowen. Your line is open.

Hi. Thanks for taking my question and congrats on all the progress. Just one quick commercial question. Can you provide a little bit of additional color around the feedback from physicians that have tried benpidoic acids since the data at ADC? Have physicians seemed to care at all about the specific level of risk reduction seen in the CLEAR outcome study, or have they mainly just seemed happy that it showed a positive result?

Hi, Troy. It's Eric. Yeah, the physician reaction to our product in general has been fantastic. And that's been before ACC as well as ACC. ACC just opened the eyes to many physicians that were waiting for outcomes data. As a reminder, we're not able to talk about those data, but I have done lots of market research projects where physicians are incredibly positive about these data. So they care about the presence of data, but they actually care about the the actual data that we generated from Clear Outcomes. So they're impressed with the data, and we've already seen some of the impact. And again, that's pre-commercialization. And Joanne?

And Troy, thank you again for the question. This is Joanne. I think as we look at the very highest level of key opinion leaders, scientific leaders, particularly in the cardiovascular community, that these data have had a profound impact. not only on their awareness, but their ability to have a new tool to address cardiovascular risk. So excited about the oral, excited about the differentiation in the study, not only lowering LDL cholesterol, but also protein. And its statin-like properties, consistency with statin, and its impact on outcomes have really been looked at very favorably and has really driven awareness, particularly in the cardiovascular field.

And Joanne, I'll just add one more comment. Troy, this is a question that, of course, gets us excited because I was actually just at a dinner with a few physicians in Washington, D.C., and what they stated, and we've heard this numerous times, is that this drug is a game changer. This drug for patients who can only take a maximum tolerated dose of a statin but still need to get to goal Or for patients who cannot take a statin and it's documented, they have something out they can turn to. So I've heard the word game changer, you know, real-life discussions numerous times. Again, very exciting. The study obviously unlocked a lot of potential for us, created a tremendous amount of awareness, as we stated in our comments earlier this morning. So, again, thank you.

Okay, great. And I actually have just one quick follow-up if I can. Have you all seen a shift in the type of prescribers who have tried to use benpidoic acid or where the prescribers have tried to use the product at all in the treatment paradigm?

It's pretty consistent. We're still seeing about 60% of our prescriptions come from primary care.

Okay, great.

Thank you. And we do have time for one final question. And that will come from the line of Judah Frommer with Credit Suisse. Your line is open.

Hi. Good morning, guys. Thanks for squeezing me in. I apologize if we missed this, but do you have any updates on how kind of post-ATC payer conversations have been going? Do you get the sense that the ATC data was enough or that they might be waiting for label change? And how are, I guess, the existing reimbursement challenges still affecting Scripps, and how could you see those potentially being lifted as the reimbursement widens? Thanks.

Yeah, thank you, Judith. Coast ACC, excuse me, we have presented the CVOT data to probably over 12 of the largest payers that account for a half of all payer lives. The receptiveness has been incredibly positive. We have commitment to actually look at the UM criteria prior to label. And we really, what we're really excited about is in the Medicare, you know, it's 34% coverage now, and we've had that commitment to take that to almost 70%, and we think that that could possibly happen before the end of the year, even before label change. The prior authorizations continue to improve. We see an overall improvement of rates growing. The three payers, probably with the largest CVS, ESI, and Optum, we're probably seeing approval rates 15% and higher at this point.

BJ, can I just add one more thing, and that is, hey, Judah, is that we don't even have the label yet, and we see our reimbursement rates, both for commercial and from a Medicare basis, very similar to that of what PCSK9 has. So I think that gives you a good idea of the success that we're seeing as it relates to the detail that BJ provided.

Thank you.

Thank you. Thank you all for participating. This concludes today's program. You may now disconnect. Have a wonderful day.