Xeris Biopharma Holdings, Inc.

Actual results may differ materially from those indicated by these forward-looking statements as a result of various important factors, including the effect of uncertainties related to the COVID-19 pandemic on the U.S. and global markets, ZARIS's business, financial condition, operations, clinical trials, and third-party suppliers and manufacturers, and other risk factors, including those discussed in our filings with the SEC. In addition, any forward-looking statements represent our views only as of the date of this call and should not be relied upon as representing our views as of any subsequent date. We specifically disclaim any obligations to update such statements. I'll now turn the call over to Paul.

Thanks, Alison. Good morning to everybody, and thanks for joining us today. Our headline for this call is that we had another very good quarter in the first quarter of 2022. We generated approximately $22 million in net product revenue. We continued strong prescription and share growth for GVOC, We continued to add more patients to all of our products, including G-Vote, La Corale of Cabeas, and even Ogolo in the U.K., and the G-Vote kit, which became available at the end of the quarter. We also dramatically strengthened our cash position with the addition of a $30 million pipe and the debt refinancing we finalized with Haytham, ending the quarter with over $132 million in cash. And we continued to advance the Phase I study of our Levothyroxine product. This first quarter performance gives us great confidence that we are on track for the year. We are therefore affirming our previously announced guidance of $100 to $120 million in total net product revenue for 2022, realizing $50 million in synergies from the StrongBridge acquisition by year end 2022, year end 2022 cash balance of $90 to $110 million, and achieving cash flow and break even by year end 2023. I'll go into some specific highlights behind our performance, starting with GVOC. We continue to see impressive GVOC prescription growth. In the first quarter, GVOC prescriptions grew 88% compared to first quarter last year. On a sequential basis, GVOC grew 5% quarter over quarter, while the overall glucagon market declined 1%. So, again, there continues to be strong demand for GVOC, and we continue to outpace the market. For those watching prescriptions, April started out a tad flat during the holiday period, but we finished the month strong with over 2,700 prescriptions the last week of April and a 22% market share, which makes us feel really good about the balance of the second quarter. Overall, the glucagon market growth versus prior year has been improving as offices are now open and reps have better access to those offices. While we are not quite back to pre-pandemic growth levels of over 20 to 30%, we are back to double-digit growth. Ready-to-use glucagon products are now over 65% of the new to glucagon prescriptions, which is also very encouraging. We believe that when the market does return to those pre-pandemic growth levels, Assuming GEVO continues to outpace the overall market, we are very well positioned to capture a good portion of that growth. Since Tetras Pharma launched OGLO in late 2021 in the U.K., they're beginning to see modest early uptake and growth in prescriptions as they get on regional health formularies, which is a process not terribly different than getting on payer formularies in the U.S., Texas also continues to work toward launching OGLO in additional countries in the EU in the balance of 2022. Moving on to Cabeas, we are very pleased with the steady increase in the number of primary paralysis patients benefiting from our product. Year over year, the number of patients on drug is up 12%, and as we've discussed previously, PPP patients are extremely hard to identify, so this strong performance is a testament to the collective expertise of the team and the close working relationship with the health care community. On to RecoraLive. As you know, we launched RecoraLive in February, and as we mentioned previously, from the time of first referral and clearing reimbursement to starting on drugs and then properly titrating to one's optimum dose can take a patient several weeks to a couple months. So demand-based sales will take a while to kick in. And with it being only a few weeks into launch, it's too early to be a meaningful contribution on the resident line. That said, receptivity with healthcare providers has been excellent. We are getting referrals, we're getting patients on drugs, and we're very excited about the prospects for RecoraLove as another alternative for healthcare professional patients who struggle with Cushing's syndrome. And while it's only been a few weeks since launch, we are already supporting patients on Recorla through the initiation, reimbursement, and titration process with our Xeris Care Connection team. We don't have much in terms of pipeline updates since our last call a few weeks ago. However, we did receive a positive response from FDA on our proposed next Phase II exercise-induced type of ischemia study, which we still aim to initiate later this year. Our phase one pharmacokinetic study of serosal levothyroxine to evaluate its potential as a once weekly subcutaneous injection is still ongoing. We have completed two dose levels and will begin dosing the third, the next higher dose cohort later in the second quarter. We expect to complete this PK study and report out results from a range of doses and dose proportionality later in 2022. Before I turn the call over to Steve for detail on our first quarter financial performance, I'd like to reiterate. We had a great quarter. We feel very confident in our ability to hit our guidance for the year, especially with our exceptionally strong cash position as a result of cash on hand, revenue generated from our three commercial products, the addition of cash from the recent private placement, and with our debt refinance. So now I'll turn it over to Steve.

Thanks, Paul. Good morning, everyone. I will focus my remarks on a few of the key financial results, the details of which are in the press release issued this morning. Total net product revenue was $21.9 million for the first quarter, representing a 33% increase over pro forma first quarter 2021 revenue. Net product revenue was driven by strong underlying patient demand for both Chivo and Cabeas. While we did recognize Record Love revenue in the first quarter, it was immaterial to the overall results as we had just launched Record Love well into Q1. GVO continued its strong momentum in the first quarter, growing total prescriptions more than 88% from Q1 of 2021 and topping 30,000 prescriptions in the first quarter. GVOC quarter-over-quarter prescription growth was 5%, despite the overall glucagon market total prescriptions declining by 1%, which is in line with historical trends in the first quarter relative to Q4. In Q1, GVOC continued to capture share of the glucagon market. At the end of March, GVOC achieved approximately 22% NRX share, and the most recent weekly data ending April 29th would suggest GVOC has now achieved approximately 24% NRX share. In the first quarter, we also made an adjustment to our returns reserve based on actual returns. As our GVOC product is still in launch mode and we don't have a significant history of product returns, we estimate product returns based on various factors. We will continue to monitor and adjust our returns reserve as necessary. Cabeas also had a solid quarter from a patients on drug perspective as we grew patients on drug by 12% relative to the first quarter of 2021. Just to wrap up my comments on revenue performance in the first quarter and looking ahead of that, we had a solid quarter and we continue to feel confident based on the underlying fundamentals driving the growth of the business that we will finish within the range of $105 to $120 million for full-year 2022 net product revenue. Moving down to P&L, cost of goods sold was $6.3 million for the three months ended March 31, 2022, an increase of approximately $4.4 million compared to the same period in 2021. This increase was primarily driven by increased sales of our products. Research and development expenses increased by approximately 2.2 million in the first quarter to 6.3 million compared to the same period in 2021. These increases were primarily driven by higher pharmaceutical process development and clinical costs across multiple programs. Relative to the fourth quarter of 2021, research and development expenses decreased by approximately $3.8 million. This decrease was driven by lower clinical service and pharmaceutical process development costs, also across key pipeline programs, relative to the fourth quarter. Selling general and administrative expenses increased by $16.8 million, or 88% for the three months ended March 31, 2022, compared to the same period in 2021. We incurred $11.5 million of increased commercial-related costs, including an increased report for GVOC, Civeas. In addition, approximately $2 million of the increase was related to the acquisition of StrongBridge, primarily restructuring and related employee costs. The remaining change was due to an increase in general expenses given the growth of the company. Let me provide some important context. to these increases relative to the first quarter 2021, as well as some context on sequential quarter-over-quarter changes. I had mentioned on our year-end earnings call in March that with the acquisition of StrongBridge, we would absorb the Coveas commercial infrastructure and other key personnel, which prior to the fourth quarter of 21 did not exist in Xeris's financial results. In addition to StrongBridge-related infrastructure, we had also expanded our endocrinology commercial team in mid-2021. And this expansion is also driving some of the increase relative to the first quarter of 2021. This is an important context in terms of the increases to SG&A relative to first quarter 21 expenses. On a quarter-over-quarter basis, SG&A expenses actually decreased by approximately $18 million in the first quarter relative to the fourth quarter. The fourth quarter included approximately $18 million of cost associated with the acquisition of StrongBridge. And in the first quarter, we only incurred approximately $2 million of expenses associated with the acquisition of StrongBridge. We had mentioned that StrongBridge acquisition costs would materially decrease in 2022. Therefore, we are seeing a net decline of SG&A expenses on a quarter-over-quarter basis, even though we incurred costs associated with the launch of a Core 11 in the first quarter. As a reminder and consistent with previous guidance, we believe that we are on track to realize $50 million in strong bridge acquisition-related synergies approximately equally split between cost reductions and cost avoidance by the end of 2022. From a cash perspective, as of March 31, 2022, Xeris had total cash, cash equivalents, and short-term investments of $132.1 million compared to $102.4 million at December 31, 2021. Our balance sheet was strengthened by both the $30 million pipe financing in January and the debt refinancing we finalized with Hathen in March. Our net operating and investing cash burn for the quarter was approximately $42 million, which was driven by our net loss in Q1, coupled with changes in working capital, primarily related to an increase to accounts receivable from higher sales and a decline in accrued liabilities from year-end 2021. You will also see in our quarterly filing that Xeris today entered into a sales agreement with Jefferies for a new ATM. You'll recall that we had an ATM in place previously, but with the strong bridge acquisition and the establishment of a new corporate parent, the ATM was effectively terminated. We do not have a need currently for additional equity financing, but are doing this as a matter of good financial housekeeping should the need arise in the future. As we announced in March, we entered into a senior secured term loan agreement with funds managed by Hafen to provide us with up to a total of $150 million of capital. We drew $100 million on the closing date in March, and we repaid our previous debt facility of $43.5 million with Oxford Finance and Silicon Valley Bank. The net proceeds will provide additional working capital to fund our business plan. An additional $50 million is available to Xeris at our election until March 2023. Based upon our current operating plan, we would expect we will draw the remaining $50 million by the end of this year. This capital base and the additional $50 million from the debt facility provides the company with significant operating flexibility to drive our rapidly growing commercial business as currently constructed to cash flow break-even by year-end 2023 and thereafter produce increasing operating cash flow. As a reminder from our last call in March, we project the rate of cash burn to improve over the course of 2022 as our revenue base continues to grow and we see a decline in obligations associated with the strong bridge acquisition-related costs. With the revenue growth from our three marketed products combined with our current cash position, the cash received from the recent pipe financing and the debt restructuring with Hay Finish 2022 with approximately and further can achieve cash flow break-even by year-end 2023. Cash flows are off to a strong start, and we are excited about the very early returns on RECORLED. We are affirming our full year 2022 net product revenue range of 105 to 100. We have integrated StrongBridge quickly in Nazareth, and we will achieve $50 million in 2022. And we are in a solid position from a cash perspective to drive growth of Chivo, Cabeas, and Recorla, and fund our R&D pipeline. I will now turn the call back to Paul.