Xeris Biopharma Holdings, Inc.

Good morning all. I would like to welcome you all to the series Biopharma second quarter 2023 financial results call. My name is Prika and I will be your moderator for today's call. All lines are on mute for the presentation portion of the call today with an opportunity for questions and answers at the end. If you would like to ask a question, please press star then one on your telephone keypad. I would now like to pass the conference over to your host Alison Way, Senior Vice President of Investor Relations and Corporate Communications to begin. So Alison, please go ahead.

Thank you, Brika. Good morning and welcome to Xeris Biopharma's second quarter financial results conference call and webcast. A press release with the company's financial results was issued earlier this morning and can be found on our website. We are joined this morning by Paul Edith, Chairman and CEO, and Steve Piper, our CFO. Paul will provide opening remarks Steve will provide details on our financial results, then we will open the call for Q&A. Before we begin, I would like to remind you that this call will contain forward-looking statements by which they include but are not limited to statements concerning our business practices, future expectations, plans, prospects, clinical approvals, commercialization, corporate strategy, and performance, which constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Actual results made different materially from those indicated by the forward-looking statements made during this call as a result of various factors, including our financial position and need for financing, including to fund our product development programs or commercialization efforts, whether our products will achieve or maintain market acceptance in a competitive business environment, our reliance on third-party suppliers, including single-source suppliers, our reliance on third parties to conduct clinical trials, the ability of our product candidates to compete successfully with existing and new drugs, adverse effects of macroeconomic conditions on our business operations and clinical activities, and our and our collaborators' ability to protect our intellectual property and proprietary technology, as well as other risk factors set forth in our filings with the Securities and Exchange Commission. Any forward-looking statements on this call 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. Subject to obligations under ethical law, we disclaim any obligations to update such statements. I'll now turn the call over to Paul.

Thanks, Alison. Good morning, everyone, and thank you for joining us today. For the past several quarters, I've started by reiterating what kind of company we're building at Ceres. I'm excited to once again say that the entire organization continues to execute, performing at a high level, and absolutely delivering on our vision. What I hope you take away from today's call and our continued positive performance is that everyone at Xeris remains intensely focused on delivering for patients by continuing to build a substantial patient-centric, commercially focused, and self-sustaining biopharma enterprise. I believe that all three pillars of our business, multiple growing commercial products, a highly targeted development pipeline, and value-added technology partnerships are contributing to our vision and will result in long-term shareholder value. I'll start with key highlights of another record quarterly performance. We recorded total revenue of $38 million in the second quarter, a 50% increase from second quarter of 2022, and a 14% increase from first quarter of this year. This is our third consecutive quarter of at least 50% revenue growth year over year. We ended the second quarter with over $80 million in cash, cash equivalents, and short-term investments, a very healthy cash position to support our continued growth. Based on our performance year to date and our outlook for the rest of 2023, we have tightened our full year 2023 guidance as well. Our revised guidance for 2023 is total net revenue of $145 to $165 million, cash utilization of between $57 and $67 million, and 2023 year-end cash balance of between $55 and $65 million. Importantly, we remain on track to hit a cash flow break-even point by year-end 2023 and will continue to be a self-sustaining company thereafter. Steve will get into more of our financial performance in some detail later on. On to the first pillar of our business, our growing commercial products. All three products, GVOTE, Cabeas, and Recorlev, showed strong growth, collectively generating approximately $37 million in net product revenue in the second quarter, an impressive 46% increase over second quarter last year, and a 14% increase over first quarter 2023. Let me break it down in one product at a time. First, GVOC. GVOC had another record quarter of net revenue in prescriptions, totaling $15.6 million in net revenue, a 36% increase compared to second quarter of 2022. Total prescriptions for the second quarter were over 51,000, growing 50% compared to the same period last year and a 12% increase from first quarter 2023. Throughout the second quarter, GVOC has averaged approximately 4,000 prescriptions per week and has recently hit a new all-time record of over 4,500 prescriptions in the most recent weekly data. Market growth for glucagon products is back to consistent double digits. GVOC continues to outpace all other products by driving the majority of the market growth. We also continue to capture market share. At the end of July, GVOC market share of new and total prescriptions in the retail glucagon market grew to approximately 31% and 29% respectively. The new ready-to-use glucagon products now represent 79% of new prescriptions and over 77% of total prescriptions. We are in back-to-school season now, and with the latest weekly record high, we believe we are starting to see the bump in weekly prescriptions that recurs annually during late July and August, accompanied by an uptick in overall market growth. To build on GVOC's momentum later this year and going into 2024 in the now double-digit growing Lufthansa market, we are investing in another modest expansion of our inside sales force. We'll be adding 20 inside sales reps in the fourth quarter of this year, bringing that force to a total of 50. We've proven this group can be highly productive rather quickly in generating GVOLC awareness, fueling market growth, and gaining GVOLC share. Also, you may have seen last week GVOLC hit a major milestone. Over 1 million GVOLC units have been shipped since its launch in late 2019. We are extremely proud of this achievement. However, we are just scratching the surface of this opportunity. There is a long way to go until 15 million people with diabetes who are at increased risk of a severe low blood sugar event are carrying a ready-to-use glucagon, such as Givo Kypopen. The key to a major change in this situation is the healthcare professionals who manage these patients. To address this critical situation and motivate healthcare professionals to do more, the ADA, the Endocrine Society, the Association of Clinical Endocrinology and other professional societies have revised their guidelines or algorithms in some manner to advocate that the standard of care for all insulin and sulfonylurea treated patients should be that they are also prescribed a ready-fused glucagon so they are protected against a potentially life-threatening severe low blood sugar event. Based on the latest available data, there are still over 240,000 emergency department visits 60,000 hospitalizations, and tens of thousands of deaths annually due to severe low blood sugar. These are avoidable with the new innovative ready-to-use glucagon products, as are the associated healthcare costs.