ZVRA - NASDAQ
Zevra Therapeutics, Inc.
ZVRA·NASDAQ
$11.17
+2.7%HealthcareBiotechnology
Zevra Therapeutics, Inc., a rare disease company melding science, discovers and develops various proprietary prodrugs to treat serious medical conditions in the United States. The company utilizes its Ligand Activated Therapy technology to generate improved prodrug versions of FDA-approved drugs, as well as to generate prodrug versions of existing compounds that may have applications for new disease indications. Its prodrug product candidate pipeline is focused on the high need areas of attention deficit hyperactivity disorder, stimulant use disorder, and CNS rare diseases, including idiopathic hypersomnia (IH). The company's lead product candidate KP1077, which is under Phase II clinical trial for the treatment of IH and narcolepsy, is based on its prodrug of d-methylphenidate, known as serdexmethylphenidate. It is also developing KP879, a prodrug product candidate for the treatment of stimulant use disorder and is under Phase II clinical trial. In addition, the company has received FDA approval for AZSTARYS, a once-daily treatment for attention deficit hyperactivity disorder in patents age six years and older, and for APADAZ, an immediate-release combination product containing benzhydrocodone, a prodrug of hydrocodone, and acetaminophen. The company's product pipeline include, arimoclomol It has collaboration and license agreement with KVK-Tech, Inc. and Commave Therapeutics SA. The company was formerly known as KemPharm, Inc. and changed its name to Zevra Therapeutics, Inc. in February 2023. Zevra Therapeutics, Inc. was incorporated in 2006 and is headquartered in Celebration, Florida.
At a Glance
Live SnapshotMarket Cap$660.32M
EPS1.4000
P/E Ratio7.98
Earnings Date08/11/2026
Earnings Call Transcript
ZVRA • 2023 • Q2
Operator
Good morning, and welcome to the
Nichol Ochsner
Good morning, and thank you for joining us today to review
Christal Mickle
Thank you, Nichol. Good morning, and thank you all for joining us today. The year-to-date has been a dynamic time for
LaDuane Clifton
Thanks, Christal, and good morning, everyone. As Christal mentioned, we are pleased to announce that A
Operator
[Operator Instructions] We will take our first question from Louise Chen with Cantor.
Unidentified Analyst
This is Harvey on for Louise from Cantor. My first question is on a potential second net sales milestone you might achieve in 2023. How big is this potential milestone. Secondly, what are the expectations heading into the interim Phase II IH readout, what caused it to be a home run scenario?
LaDuane Clifton
Well, thanks for your question, and I'll take the first one, Christal. The second milestone, we've not been able to disclose its magnitude or the sales threshold that we have to achieve in order to earn that milestone, but I think it's safe to say that it will be larger than the one we just earned in Q2, which was $5 million. So I'm a bit limited there, but I think that we can look forward to a continued sort of growth not only in net sales, but also in royalties, and the size of the milestones. Christal?
Christal Mickle
Yes. Great. And as far as your question regarding the interim data, as you may remember, the point of the interim data is really to inform us on the Phase III trial moving forward. And so what we're really interested in is looking at the multiple dosings that we're looking at. So if you remember, we're looking at either a once dosing and the evening prior to going to sleep or twice dosing once in the evening and before waking. So looking at that and then also looking at the doses that are being used and seeing that those doses are higher than, than what is being used for other stimulants that are out there and making sure that we're in the right range for us as we move forward.
Operator
And our next question comes from Oren Livnat with H.C. Wainwright.
Oren Livnat
Congrats on the A
Christal Mickle
Appreciate the question. So no, we actually are continuing with our strategy as we're moving forward with the resubmission. So going with the FDA recommended analysis is not something that is new. And then when you -- we're talking about the validation and those other points, those are also things that are -- that will be included in the NDA. So those are all still moving ahead as we had originally planned to do.
Oren Livnat
Okay. And so the timing change, which is not material necessarily, but I'm just curious if that's just more calibrating after your meeting with the FDA? Or is there a new stuff you've been working on, whether it's nonclinical stuff in animals or just analysis or reanalysis of the data?
Christal Mickle
So it really boils down to -- we had our FDA meeting very recently, and so it's a refinement of making sure that we present the data in a way that the FDA would like to see it. And so with that, there are a few additional analyses. There's refinement in the way that we're presenting our arguments and our data. So even though what we're planning to present hasn't changed, there is some nuances there that we are going to look at. And so that pushes that a little bit out from that end of Q3 that we had originally talked about.
Oren Livnat
Okay. And I guess to characterize this meeting as, I think, collaborative or productive or both, which is great. I think in the past, maybe -- I don't know if it's in response to questions or if you volunteered upfront, you talked about, if necessary, you could take, I guess, less collaborative or more aggressive approach with dispute resolution and things like that, if necessary, is -- am I detecting a change in tone here because of that was mentioned or in the deck, I don't think that you feel actually more optimistic now, maybe after your meeting with the FDA, then than you did before and that you don't think you're going to have to pursue anything like that? And do you expect to request an ADCOM sort of upfront?
Christal Mickle
So to answer your first question, those options are always still available and still on the table. We do -- we were hopeful with this meeting that we had because it was a collaborative meeting, we were appreciative of the tone that the FDA had. And so they do seem to be working with us to get this resubmission in. And then as far as -- what was your second point there or your last point?
Oren Livnat
Whether you expect, I guess, upfront to request an FDA, an ADCOM meeting...
Christal Mickle
So that's an interesting question. I don't think we will as for upfront. We welcome it if it comes from the FDA, and that's still a consideration if the FDA does not ask for it that we may ask for it ourselves, but it's not something that we'll ask for immediately upon resubmission.
Oren Livnat
Okay. And if I just may look a little further down the line, assuming this all goes well. Any progress that [indiscernible] talking about on remarkable life cycle management. I think there was some hopes to improve dosing, get some more additional IP around the project? Anything to report there?
Christal Mickle
So right now, we are focused on approval. But those are always things that we will look for as we move forward.
Operator
[Operator Instructions] Our next question comes from Sumant Kulkarni with Canaccord.
Sumant Kulkarni
I have a couple. So on the lease commitment of the arimoclomol NDA, you mentioned the productive and collaborative process with the FDA, which portion of the 3 parts of the Complete Response Letter and your ongoing response. Would you say that the majority of your last interaction with the FDA was focused on? And then I have a follow-up.
Christal Mickle
So we really -- we presented everything because we did treat this as a pre-submission meeting, but we have -- a large part of it was also focused on the confirmatory evidence that the FDA hasn't seen in the past.
Sumant Kulkarni
Got it. And then in the last meeting with the FDA, did the agency state specifically that no additional clinical data would be required, or did the FDA making suggestions that additional clinical data that may be required but left to the discussion of
Christal Mickle
There was no discussion about additional clinical data being needed.
Operator
And our next question comes from Jonathan Aschoff with ROTH MKM.
Jonathan Aschoff
I was curious, so that was just the [$670,000] booking for A
LaDuane Clifton
No. So it was not flat. So I guess when I read through all the components of revenue, when you -- if you add it all together, there is the cost of revenue of [$677], which I guess if you look at the press release in the detail. So to be clear, we had $800,000 in net sales royalties from A
Jonathan Aschoff
Okay. So the net arimoclomol is not $2.8 million. It's a little less or it is $2.8 million, and it kind of can't be $2.8 million.
LaDuane Clifton
There is a cost of revenue associated with the milestone. If you remember, we pay a 10% royalty to request it. And so we had to recognize a 10% reduction based on that. That's the difference that you're thinking of.
Jonathan Aschoff
Okay. And I was curious, in your response to the first question, you were talking about the interim IH data to inform a Phase III trial. But I was thinking, why do you even care about that, the final data is a few months away, isn't that vastly more important and informative in the Phase III than what comes at the end of this quarter?
Christal Mickle
So actually, no. The whole point of the Phase II trial was to inform the Phase III trial. It's ultimately, this prodrug is a stimulant. And so we know that there's going to be an effect. And so what we wanted to get out of this trial is really those nuances that we'll need to understand as we're preparing for the Phase III trial and preparing the protocol for the Phase III trial. So this -- getting this interim data is going to allow us to kind of refine that Phase III trial move forward with FDA meetings and further preparations for those -- for the Phase III trial while we finish up to Phase II.
Jonathan Aschoff
Okay. And lastly, I guess it's fair to assume maybe you can say this is your A
LaDuane Clifton
I haven't made that statement. So no, I wouldn't say that.
Jonathan Aschoff
So they might actually stay fairly in line with that 20% payout kind of ratio?
LaDuane Clifton
I mean I think that would be a great outcome as it did. And I'd say this just -- I would just remind you that when we went back and had a chance to renegotiate these milestones back in April of '21. We really were looking for a way to pull milestones forward, if you will. And so those ratios are probably a little bit different than what you might think are typical of a market license. So the fact that the first few are in this range I think, speaks to some of those amendments we were able to get agreed to back in that time frame.
Jonathan Aschoff
Yes. I mean to have $25 million trigger sales milestone at any time is a pleasant surprise for sure. So you guys really did a good job on the front end of that.
Operator
And this does conclude the Q&A portion of today's call. I would now like to turn the call back over to Christal Mickle for any additional or closing remarks.
Christal Mickle
Great. Thank you very much. We're excited about our progress in the first half of 2023 and are looking ahead to continue our momentum. As we look forward to the second half and into 2024, we're focused on the following 3 top priorities: First, to resubmit the arimoclomol NDA to the FDA and strengthened key functions and capabilities to support a successful launch of approved. Second, to complete the Phase II trial of idiopathic hypersomnia and prepare to advance KP1077 into a Phase III trial sometime next year. And third, to continue our work to expand our KP1077 program into narcolepsy. Corporate development also remains a priority as we actively engage in conversations to potentially acquire new pipeline assets that would be complementary to our portfolio, and that could benefit from the potential application of our prodrug technology. We're building something really special here at
Operator
This concludes today's
Transcript from August 17, 2023
Other Transcripts
Related Guides
Continue your ZVRA research with focused valuation guides.
Research Paths
1
Snapshot
Start with context, operating signals, and key market metrics.
2
Value Model
Stress test fair value across bear, base, and bull assumptions.
3
Statements
Validate revenue quality, margins, and balance sheet durability.
4
Earnings Call
Read management commentary and compare it with reported outcomes.
5
Dividends
Check payout sustainability and long-term distribution behavior.
6
Analyst Expectations
Review consensus spread and where estimate risk is concentrated.