ARDX - NASDAQ

Welcome to the Ardelyx Fourth Quarter and Fiscal Year 2024 Earnings Call. [Operator Instructions] I would now like to turn the conference over to Caitlin Lowie, Vice President of Corporate Communications & Investor Relations. Caitlin, you may begin.

While we may elect to update these forward-looking statements in the future, we specifically disclaim any obligation to do so, even if our views change. Our President and CEO Mike Raab will begin today's call with opening remarks and an overview of the company's progress during the fourth quarter of 2024. Next, Eric Foster, Chief Commercial Officer, will provide an update on the performance of IBSRELA and XPHO

Thank you, Caitlin, and good morning, everyone. I'm pleased to be here today to discuss our fourth quarter and full-year 2024 performance. In the past year, our team's dedication to outstanding commercial execution led to numerous significant achievements. IBSRELA’s growth continued throughout 2024 with acceleration in the fourth quarter as we began to see the positive impact of our expanded sales team. It is evident that patients are benefiting from IBSRELA, as this important medication provides rapid and lasting relief from the symptoms of IBS-C, which can significantly disrupt patients' lives. For XPHO

Thank you, Mike. It's great to be with you all again. Across our portfolio, we had a great fourth quarter driven by strong demand from prescribers for these two first in class medicines that are demonstrating the clinical benefits they can offer patients. Every day we hear success stories of patients with IBS-C whose quality of life has improved, thanks to IBSRELA, or CKD patients who have struggled for years to achieve target phosphorus levels are now coming into range, thanks to XPHO

Thank you, Eric. Earlier in January, we announced our product revenue and cash position. So I use this as an opportunity to review that material and highlight additional key financials from both the fourth quarter and full-year 2024, as well as offer some thoughts on 2025. We had total revenues of $116.1 million in the fourth quarter of 2024, driven by growth in product sales. On a full-year basis, we reported total revenues of $333.6 million in 2024 compared to $124.5 million in the prior year. Our performance was driven by strong year-over-year growth for IBSRELA and the exceptional launch of XPHO

Thanks Justin. Since our founding in 2007, every year, no matter the challenges we've encountered, had made us better and more resolute in our mission. 2024 was an incredible year for Ardelyx, and the patients we serve are benefiting from our medicines. We protected patient access to XPHO

And our next question comes from Dennis Ding of Jefferies.

Hi, good morning, thanks for taking our questions. We have one on XPHO

Yeah, thanks, Dennis. I agree with Mike. I think it is too early to say whether or not we've been at the bottom. What I can say is, our message has certainly been well received with regards to access continuing for XPHO

Yeah, as Mike said we're not going to be able to get into specifics in terms of quantifying it, but I can confirm that we had patients that were on XPHO

And our next question comes from Joseph Thome of TD Cowen.

Hi there, good morning and thank you for taking my questions. Maybe on the first one on XPHO

Thank you.

[Operator Instructions] And our next question comes from Roanna Ruiz of Leerink Partners.

Hey, good morning everyone. So, quick one on XPHO

Got it. And last one for me, I noticed you're getting solid traction with the recent IBSRELA field force expansion. Just thinking ahead, are there any triggers or milestones that might encourage you to do additional field force expansion either for IBSRELA or XPHO

Got it, thanks.

And our next question comes from Julian Harrison of BTIG.

Hi, good morning. Congrats on the really strong quarter and for taking my questions. On XPHO

Excellent, thank you.

And our next question comes from Ryan Deschner of Raymond James.

Good morning. Wanted to ask about what the level of promotion sensitivity for XPHO

Got it. And then how are you thinking about expectations for gross to net further down the line at steady state for XPHO

Thank you, Ryan. It's still relatively early, as you might imagine in the launch and with the payer dynamic change that we're seeing in 2025 and expect to see prospectively, it'd be too early to give precision. We try to give information when we have it. So as I said in my prepared remarks, we expect it to be less favorable in 2025 compared to 2024 because the Medicaid and commercial-related discounts, if you will, are higher than Medicare. But we'll give more color as things progress. It's just too early for us to give guidance.

Got it, thank you very much.

And our next question comes from Ed Arce of H.C. Wainwright.

Hello good morning everyone. This is Thomas Yip asking a couple of questions for Ed. Thank you very much for taking our questions. So first question, also on XPHO

Just to reiterate what both Mike and Eric said earlier that our patient mix was approximately 60% Medicare, 40% non-Medicare in 2024. And so that is, again, with patients losing Medicare Part D benefit coverage in 2025, that will be a change that we are working through in 2025, but still believe there's a significant population that we will build from. And then on the -- I believe you may be referring to the cost of our patient assistance program. So as a reminder, costs related to our patient assistance program do not run through cost of goods sold, but rather are part of our SG&A expenditures. And again, they're somewhat modest and that's been included in the guidance that we gave, where we believe SG&A will increase approximately $10 million per quarter over the course of 2025 compared to Q4 of 2024.

Got it. And then perhaps one more question from us with IBSRELA. Based on your net sales guidance, $240 million in 2025 and you outlined a number of initiatives this year, what other programs strategy do you have in place in order for IBSRELA to reach towards the $1 billion net sales goal?

Sure. I'll ask Eric to comment a little bit more. But as he said in his prepared remarks, the omnichannel efforts that we have underway, patient communication that is going to expand, a number of other initiatives like are part of the omnichannel efforts.

Yes. I would -- as we come into 2025, one, we've got the continued expansion of the sales force. So we've got a full team in place there. The team -- the marketing team has done a great job. We've had the evolution of the campaign in Q4 of last year and now continuing to expand our patient initiatives and our patient marketing efforts. This is a devastating disease for these patients and we need to continue to amplify the impact of the disease and the patient voice. We know we've got an engaged patient population and we want to meet them where they are to make sure that they feel empowered and confident when they run or when they get into the office. And the marketing team is working very hard to really pull that through in 2025. And then from an access standpoint, we talked a bit about the field access managers. So again, as you think about that patient journey, really from coming into the physician's office, talking about their disease and the impact on their life, really raising their voice and being impactful with the physician to be able to get the right treatment for them, we feel that we've got the right insights and we've got the right strategy that we're going to be able to amplify that in 2025. And then again, with the field access manager team to really help those patients be able to pull through so that they can continue to have access to IBSRELA.

And our next question comes from Chris Raymond of Piper Sandler.

Thank guys. Just on the commercial pay market for XPHO

Hey Chris, thanks for the question. We actually don't discount to payers. That's the whole decision that we made to embrace the prior authorization process. And if and when they come to us that means that we have come to their radar and generating sufficient revenue that [indiscernible] those questions. When or even if that happens, I think it's hard to predict. I don't know, Eric, any thoughts?

Yes. I would say our primary objective is access to XPHO

Thank you.

This concludes our question and answer session. I would like to turn the conference back over to President & CEO, Mike Raab, for any closing remarks.

Thank you all for joining us this morning and a special shout out goes to Team Ardelyx, who I know is listening. Your hard work is invaluable in bringing our essential medicines to patients and we wouldn't be where we are without you. I also want to acknowledge our shareholders for their support on this journey. We're building a significant company, having successfully developed our medicines from initial concept through development and now into commercialization. This achievement is not just noteworthy, it's a testament to our capabilities and we're excited to seize the opportunity and to do it again. With that, we can conclude the call. Thank you, operator.