Mirum Pharmaceuticals, Inc.

Good afternoon, and welcome to Merham Pharmaceuticals' fourth quarter and full year 2025 conference call. My name is Elliot, and I'll be your operator today. All lines are currently in listen only mode, and there will be an opportunity for Q&A after management's prepared remarks. I'd now like to hand the conference over to Andrew McKibben, SVP of Strategic Finance and Investor Relations. Please go ahead.

Thank you, Elliot, and good afternoon, everyone. I'd like to welcome you to Merim Pharmaceuticals' fourth quarter and full year 2025 conference call. I'm joined today by our Chief Executive Officer, Chris Peetz, our Chief Medical Officer, Joanne Klon, and Eric Bierkolt, our Chief Financial Officer. Peter Radovich, our President and Chief Operating Officer, is unable to join us today as he's attending an international commercial event. Earlier this afternoon, Merim issued a press release reporting our fourth quarter and full year 2025 financial results. Copies of the press release and our SEC filings are available in the Investors section of our website. Before we start, I'd like to remind you that during the course of this conference call, we will be making certain forward-looking statements based on management's current expectations, including statements regarding Merrim's programs and market opportunities for its approved medicines and product candidates and financial guidance. These statements represent our judgment and knowledge of events as of today and inherently involve risks and uncertainties that may cause actual results to differ materially from the results discussed. We are under no duty to update these statements. Please refer to the risk factors in our latest Form 10-K and the subsequent SEC filings for more information about these risks and uncertainties. With that said, I'd like to turn the call over to Chris. Chris?

Thanks, Andrew, and good afternoon, everyone. 2025 was a year of disciplined execution and growth for Miriam, positioning us for a pivotal 2026. On today's call, we'll recap some of the headlines we announced in January and open the call for questions. In 2025, we delivered $521 million in net product sales, exceeding the upper end of our guidance range. This was made up of Litmarli net product sales of $245 million in the U.S., $115 million internationally, with our bile acid medicines also contributing $161 million. The strong finish was driven in particular by our continued leadership in Allergy Syndrome, accelerating PFIC uptake, and growing demand in our international markets. Building on this performance, we are entering 2026 with confidence and expect to deliver net product sales of $630 to $650 million for the year. Beyond commercial performance, we advanced our pipeline through important clinical and regulatory milestones, including the approval of Citexly for CTX and a tablet formulation of Ligmarly and enrollment completion of the VISTA study of Elixabat and PSC. We also meaningfully expanded our pipeline with the addition of the Phase 3 Brolovitac Program for Chronic Hepatitis Delta Virus, a serious, rare disease with limited treatment options. This addition to the portfolio is an excellent fit with our team and the upcoming potential Zalixibat launch, creating substantial operating leverage. Since the closing of the transaction earlier this year, integration has progressed smoothly, and we welcome a team that shares our focus on disciplined execution and delivering high-impact medicines for patients with rare disease. With the addition of Brilovatug, we now have four potentially registrational clinical readouts expected over the next 18 months in areas of significant unmet need. Beginning in the second quarter, we expect to report top-line data from the Velizabat VISTA study and PFC, as well as interim results from the Azure One study of Brilovatug and hepatitis delta. The broader Azure phase three program continues to enroll well, and we expect full top-line results from both Azure 1 and Azure 4 Phase 3 trials in the second half of the year. We're also seeing continued momentum across our other Livmarley and Velixibat programs. Enrollment in the Phase 3 EXPAND study and additional rare cholestatic conditions, as well as the Vantage study in PDC, continues to exceed expectations. And we expect to report top-line results from EXPAND in the fourth quarter of this year and from Vantage in the first half of next. And finally, the Bloom Phase II study of MRM3379 and Fragile X Syndrome is also on track for data next year. Taken together, Mirim is entering a pivotal phase of growth as a leading rare disease company with multiple commercial medicines and several near-term potentially registrational readouts. Our team's strength continues to be its dedication to understanding patient needs and translating that into important medicines. Through this team's insight and hard work, we have now built a portfolio with over $4 billion in potential revenue. And with that, I'll turn it over to Joanne to walk through our pipeline in greater detail. Joanne.

Thanks, Chris. 2025 was an important year for our pipeline, and 2026 will be even more significant as multiple programs approach potentially registrational readouts. As Chris mentioned, enrollment across all our clinical studies is on track or ahead of previously communicated timelines. Today, I'll focus on two of our near-term data readouts for Velixivad and PSC and Berlobitac and Hepatitis Delta. Starting with Velixibat and PSC, we're on track to report top-line data from the VISTA study in the second quarter of 2026. The primary endpoint, as aligned with FDA, is pruritus. Safety, change in serum bile acids and other symptoms and quality of life measures will also be evaluated. As a reminder, the study exceeded a pre-specified threshold for efficacy at the blind and interim analysis in 2024 and has proceeded with a selected 20-milligram twice-daily dose. Collectively, the prior clinical data of IBAT inhibitors in PSC and the consistent treatment effects seen across other cholestatic diseases, including PBC, all support IBAT inhibition as a meaningful therapeutic approach in PSC, a disease with no approved therapies. We look forward to sharing the top-line results from this study in the coming months. Turning to berlovotoc for hepatitis delta, I'm pleased to report that all four Azure clinical studies are progressing well. In the Azure program, Prolovitug is being studied as a single-agent regimen in a broad group of patients with elevated ALT at baseline. Azure 1 and Azure 4, the two Phase 3 studies that will form the basis of our FDA registration package, are expected to complete enrollment soon, with 24-week top-line data anticipated in the second half of the year. In the second quarter, we expect to report interim results from the Phase 2b portion of the Azure 1 study. This study is evaluating hepatitis delta treatment naive patients randomized to bilobotox or delayed treatment using a 24-week composite endpoint of viral electric response and ALT normalization, an endpoint aligned with FDA. The Phase 2B portion of the study will include the first 50 patients evaluated at the Week 24 time point. The study is continuing to enroll an additional 150 patients for the Phase 3 portion, which has the same study design and endpoints. The Azure 2 and Azure 3 studies are enrolling well. These are active controlled studies evaluating bilivertide in the context of bilivertide and are designed to support European registration as well as provide additional long-term safety and efficacy data. Finally, for MRM3379, our Bloom Phase 2 study in Fragile X Syndrome is off to an excellent start. The program recently received fast-track designation from the FDA recognizing its potential to address a serious event need. We're on schedule and expect to report data from this study in 2027. Overall, we're very pleased with the continued progress across our pipeline and look forward to several important updates over the coming year. With that, I'll turn the call over to Eric to review our financial results.

Thanks, John, and good afternoon, everyone. 2025 was a year of accelerating financial performance driven by growth across our three commercial medicines. Total net product sales in the fourth quarter of 2025 was 149 million compared to 99 million the year before. For the full year 2025, total net product sales was 521 million compared to 336 million the year before. representing 55% year-over-year growth. Total operating expense for the quarter and year ended December 31st, 2025, with $153 million and $543 million, respectively. Full-year operating expense includes R&D expense of $186 million, SG&A expense of $257 million, and cost of sales of $100 million. Expenses for the year included non-cash, stock-based compensation, intangible amortization, and other non-cash expenses of $95 million. The intangible amortization and other non-cash item expenses of $24 million are reflected in our cost of sale. The commercial cash contribution margin in 2025 was approximately 55%, a significant increase from the prior year. We ended 2025 with 391 million in cash, cash equivalents and investments, up from 293 million at the end of 2024, reflecting our solid operating performance. In addition, we recently completed two private placements concurrent with the closing of the Blue Jay acquisition, generating aggregate gross proceeds of 268.5 million effectively covering the cash outlays to support the acquisition. In 2025, we achieved positive cash flow from operations. Looking ahead, we expect R&D expense to increase in 2026, driven primarily by investments in the Berlowitard Clinical Program and manufacturing validation and scale-up in preparation for the anticipated BLA submission next year. This increase in R&D spend is fully funded. We expect a return to positive cash flow in 2027. We have scaled the business while maintaining spending discipline and a strong balance sheet, positioning us to advance our pipeline without compromising financial strength. I'll now turn the call back to Chris for closing remarks.

Thanks, Eric. To close, we are Mentors 2026 in a great position. Our commercial business has continued momentum and our financial position is strong. Our pipeline has four potentially pivotal readouts within 18 months, each representing the potential to bring standard of care changing medicines to difficult treatment settings. It's inspiring to work with a team that can achieve this level of impact for patients. It's going to be a very busy year. We look forward to several updates as we go. And with that, operator, please open the call for questions.

Thank you. If you would like to ask a question, please press star followed by one on your telephone keypad. If you would like to withdraw your question, please press star followed by two. When preparing to ask your question, please ensure your device is unmuted locally. First question comes from James Condoulas with Stifel. Your line is open. Please go ahead.

Hey, thanks for taking my question and congrats on all the progress. I actually wanted to ask one on Belixibad and specifically as it relates to the commercial opportunity. You know, obviously, Velixibat's coming first. And I think generally a lot of people are thinking about pricing in the context of Velixibat around the PPARs in terms of the PBC opportunity. And just curious as you guys are, you know, getting closer to data and potentially commercialization, kind of how you're thinking about the right way to price Velixibat and if, you know, pricing specifically around the PSE opportunity is kind of on the table or makes sense. Thanks so much.

Yeah, thanks, James, for the question. This obviously is something we spend a lot of time thinking about. And kind of as you're saying your question there, the PPARs and PBC really are a good planning benchmark to think about, but that's certainly not our final guidance or decision on it. We'll take that as we have data in hand and are closer to launch to make the final decision. And one of the big factors to keep in mind here is that unlike in PBC – There are no other approved medicines, so really unique positioning for Velixibat. But, you know, we'll take that decision when we're at launch.

Makes sense. Thanks so much.

Thanks for the question.

We now turn to Joseph Tom with TD Cohen. Your line is open. Please go ahead.

Hi there. Good afternoon, and thank you for taking my question. Maybe one on the upcoming PFC trial, our care wells are hinting that maybe the itch associated with PFC patients can be a little bit more episodic. Maybe do you see that as providing a little bit more risk into this study versus what you're seeing in PBC? And maybe what have you done in the study, whether in terms of the patients that you're enrolling or monitoring, do you think that can maybe help limit any variability there? Thank you.

Yeah, thanks for the question there. A couple things to comment on that I'll lead in. I'll let Joanne speak a little bit to some of the study design elements. And what we find in market research that's more directed at patients and some of the advanced practitioners that may spend more time with patients is a different perspective on pruritus than what you get from some of the top KOLs who may actually just be seeing the patient episodically when there are other more complicated factors. And in conversations with patients and some of the advanced practitioners, you do get a different picture of how persistent the pruritus can be and also just the proportion of patients that are actually dealing with it being quite different than, you know, might be the perspective of a KOL at a top center. But then on study design, I'll let Joanne speak to some of the things that we've seen from screening and the overall operational side.

Yeah, thanks. Thanks for the question. A couple things. Actually, we know that pruritus is an issue for a lot of patients. And then this is really from some work that we did with, you know, Chris Cowley a few years back presented to EASL that, you know, a really high proportion of patients do complain of pruritus and fatigue as the main symptoms associated with their PSC. And then perhaps about half of them said that it's disrupted their daily life activities. So pretty significant. Within the study, we are enrolling patients with persistent pruritus. And so, you know, we're careful to have that as eligibility, and therefore we track the pruritus response throughout the study. So, you know, understand kind of the basis for your question, but I think, you know, between study design and also understanding the patient population a bit better, we feel comfortable that this is really designed to address a significant symptom for patients, a significant impact in terms of their daily lives.

That's perfect. Thank you so much. Thanks for the question.

We now turn to Joe Kim with RBC Capital Markets. Your line is open. Please go ahead.

Hi, everyone. Thanks for taking my question. I wanted to dig more into the study design for PSC. If you could highlight some the key similarities and differences between VISTAs and the Vantage study designs. And you mentioned that you expect general patients with persistent pruritus, but just wondering whether we should expect the baseline pruritus scores for the PSC study to be in a similar range to what we saw in the PBC interim data. Thank you.

Yeah, so thanks for the question. So I think, you know, the commonality is that we're really studying closed-static pruritus. which is something that we know well and have characterized, you know, with the other indications that we have for Merylixibat, for instance. So, you know, we know how to measure this. We know, you know, how to implement that within a clinical trial. You know, PSC and PBC are different diseases in terms of the etiology, but we think the commonality here is the fact that there is cholestasis, intrapatic cholestasis, and then, therefore, cholestatic pruritus. So there's a lot of commonality in terms of how we implement it within the trial. I think, you know, probably the best guide in terms of what the baseline pruritus is is if you look at the PBC interim, and that shows significant pruritus. I mean, clearly within the range of moderate to severe pruritus for baseline. So I think that's kind of our expectation. We're selecting patients with moderate to severe pruritus at baseline to study in both of these studies.

Thank you.

Thanks for the question.

We now turn to John Wallenbehn with Citizens. Your line is open. Please go ahead.

Hey, thanks for taking the question. Piggybacking on the PSC questions, can you talk a little bit about your interactions with FDA around safety database requirements for the and what follow-up you'll need and what that means for timing of a potential MDA submission?

Yeah, I can jump in on this one. Thanks for the question, John. A lot of this kind of goes back to some of the original pre-IND interactions we've had with FDA. And we've subsequently actually confirmed some of the safety database questions with them, in particular around PBC, in terms of what they want for overall safety database, and with acknowledgement that PSC is smaller. And so what we do expect that the current VISTA's PSC study has the sufficient safety database for the setting. So the idea is after our top-line data, we'll have an interaction with FDA on the submission plan, and I think we'll track to get it submitted in the second half of the year.

Great. Thanks, Chris.

Thanks for the question.

We now turn to Ryan Deschner with Raymond James. Your line is open. Please go ahead.

Thanks a lot. Congrats on a big year. Looking forward to a busy cadence of catalysts this year. For the EXPAND readout coming later in 4Q this year, how are you – are you expecting to break out the data on pruritus by another second and other secondaries by indication? And are you looking at the pruritus bar here – how are you looking at the pruritus bar in general compared to what was shown in PFIC and AllerGel? Thanks.

Yeah, overall, the mix of patients in this study, just as a reminder, we think it's probably ultimately going to end up being approximately half biliary atresia and then a much longer tail with other settings. So we'll look at whatever the most relevant ways to break it out are. Biliary atresia is an obvious one. The others are just much smaller, each of them individually. But I'd come back to the comment that Joanne was making earlier just on the commonality here being these are settings with elevated bile acids and cholestatic pruritus. So we see kind of the treatment objectives and the potential for response that we've seen in compassionate use examples having more in common than different across various settings.

Thanks very much. Thanks for the question.

We now turn to Manny Faruja with LeadRank Partners. Your line is open. Please go ahead.

Hey, guys. You have Ryan on for Manny. Thanks for taking our question and congrats on the quarter. Maybe just sticking with expand, Chris, I'm curious how you think a positive readout here kind of plays out in terms of like the label expansion given it's more of a basket trial. And when we think about biliary atresia and the other indications, like how well diagnosed are these, or is this going to be more of a PFIC setting where you're going to have to improve diagnoses to really drive that additional growth?

Thanks for the question, Ryan. The thinking around label indication statement and the label, as you point out, it has some nuance because it's a basket. It's really defined by exclusion, right? I mean, we're The way that the protocol is written is it excludes the larger settings where you could run a standalone study to look at cholestatic pruritus and PSC, for example, as we're doing with Elixabet. So expect that to be reflected in the labeling. And could you remind me of the second part of your question?

Yeah, just kind of like when you think about these additional settings, like how well-diagnosed. Are these, or do you think it's going to really take a lot of hand-holding and physician education to drive further uptake in these additional settings?

Thanks.

Yeah, actually, we think that, I mean, what we're seeing in particular in the pediatric settings is, you know, it's highly symptomatic, so it is diagnosed. And that's really what the origin for the study was compassionate use requests. So, you see, the demand is out there for something to help these patients. So I do see it as a pretty well-trapped patient population.

I appreciate it. Yeah, thanks for the question.

That's another reminder. If you'd like to ask a question, please press star 1 on your telephone keypad now. We now turn to Charles Wallace with HC Wainwright. Your line is open. Please go ahead.

Hi. Thanks for taking my question. This is Charles on for RK. So, I guess a question on the guidance from me. So, in 2025, the sales grew about 55%, and the guidance range implies a 21 to 25% annual growth. So, I was wondering if you could provide some color on how much of this is driven by Liv Marley versus the bile acid portfolio.

Yeah, I mean, the growth is definitely more Mali-driven. Keep in mind, though, that for Japan last year, we had $23 million in revenues, which was inventory buildup. And this year, we expect, therefore, lower revenues from Japan, although I should clarify that the launch in Japan is going as expected. In terms of the bile acid portfolio, we do expect continued growth, but it's more kind of steady growth, not accelerating the way the live model growth has been in the last few years.

Fantastic. Thanks for taking my question. Thanks for the question.

We now turn to Brian Scorney with Baird. Your line is open. Please go ahead.

Hey, guys. Thanks for taking the question. Congrats on a great quarter and year. I just wanted to revisit the EXPAND study. Are there any learnings that you've taken away from Embark that you're going to be applying here based on the high proportion of biliary atresia patients? And could you just kind of help us contextualize the market represented by the EXPAND basket relative to PFIC and ALGS in terms of as well as the dose you anticipate using in this population.

Thanks. Thanks for the question. And it's an important distinction from Embark, actually, to point out. As a reminder, the Embark study was looking at bilirubin levels in biliary atresia patients immediately after the CASAI procedure. So think of that as it's just a very acute setting where the goal would be to try to improve the immediate transplant rates. What we learned is in that very young infant setting after CASAI procedure, that the surgical procedure directed at bile flow actually is most determinative of outcome in those young patients. Now, what's different in EXPAND and in the biliary atresia patients in EXPAND is those are all patients that had a successful CASAI, and then over time they have what seems to be just a much slower progressing or persistent cholestasis that is not the kind of acute transplant-driving situation you see in the very young patients. So the biliary trees for patients that are enrolling into EXPAND are going to be, you know, think of it as toddler to school-aged that have a persistent post-casai cholestatic pruritus. So From the learnings there, it really comes back to what we saw in compassionate use, is that there are examples of patients being highly responsive to Lipmarly treatment with that profile. So that's kind of what inspired us to pursue this study, is seeing actual strong treatment responses in those older biliary atresia patients. And in terms of bridging that to market size, But because this is a basket, it's hard to – you can't use traditional epidemiology, so you can't look at literature or incidence rates, so to speak, because this is a long list of different potential causes of cholestatic pruritus. From the work we've done in the pediatric setting, it's clear that there's readily at least 500 patients in the U.S. that would fit the profile of this, potential for more. When we look at kind of the total peak Liz Marley potential of that billion plus that we see as the long-term potential for the brand, Xpand could represent a third of that overall.

Great. Thanks for taking the question.

Yeah. Thanks for the question.

We now turn to Mike Olds with Morgan Stanley. Your line is open. Please go ahead.

Hi, this is Rohit on for Mike. Thanks for taking our questions. Can you just talk about the current market for HDV and how you expect it to develop over the coming years? And then how much do you expect R&D to increase this year from the HDV studies?

Thanks. Yeah, I'll speak to the market and pass it over to Eric to comment on the investment side. For the current treatment landscape for HDV, there really is nothing specifically labeled in the U.S. And one labeled medicine, Hepcludex, in Europe that actually has been performing well. We do expect that to evolve in the U.S. given from what we're seeing is that Hepcludex is up for review and potential approval in the U.S. and then also another dual-agent regimen looking at a HP surface damage and an SRNA approach in hepatitis delta. So this will be an evolving landscape. But what got us excited about Brilovitug as a potential for best-in-class profile is that with a single agent, you're seeing really impressive response rates, and a very attractive safety profile. It's 100% viral response at week 48. You know, that's 65% to 82% composite endpoint. It has a chance to really set the bar for treatment options in Delta, though there will be – we do expect to have other competitive agents in the market. I'm just excited about what Brilovatide can do compared to those. I'll pass it over to Eric on the P&L.

Thanks. Great question. So the good news is that Brovovitac 4 Phase 3 studies are enrolling really well, which means that the expenses will be somewhat compressed into this year. It also means we need to make significant CMC investments to prepare for filing next year. So they are compressed, and in total, related to Brovovitac, we anticipate roughly $150 million increase. in R&D spend types to this program with, you know, about half being CMC. Thank you.

Thanks for the question. This concludes our Q&A. I'll hand back to Chris Peets, CEO, for any final remarks.

Great. Thank you all for joining today. Really excited about the year ahead and hope everybody has a great afternoon.

Ladies and gentlemen, today's call has now concluded. We'd like to thank you for your participation. You may now disconnect your lines.