Q1 2021 Ironwood Pharmaceuticals Inc Earnings Call
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Good day, and thank you for standing by and welcome to the Ironwood Pharmaceuticals first quarter 2021 Investor update call.
Operator: and thank you for standing by. Welcome to Ironwood Pharmaceuticals' first quarter 2021 investor update. At this time, all participants are in a listen-only mode. After the speaker's presentation, there will be a question and answer session. To ask a question during the session, you'll need to press star 1. If you require any further assistance, please press star zero.
At this time all participants are in a listen only mode. After the speaker's presentation. There will be a question and answer session to ask a question. During the session you will need to press star one on your telephone if you require any further assistance. Please press star zero.
Kyle: I would now like to hand the conference over to Kyle, vice president, and investor relations. Good morning, and thanks for joining us for our first quarter 2021 investor update. Our press release crossed the wire this morning and can be found on our website. Today's call and accompanying slides include forward-looking statements. Such statements involve risks and uncertainties that may cause actual results to differ materially.
Kyle: A discussion of these statements and risk factors is available on the current Safe Harbor Statement slide, as well as under the heading Risk Factors in our annual report on Form 10K for the year ended December 31, 2020, and in our future SEC filing. All forward-looking statements speak as of the date of this presentation, and we undertake no obligation to update such statements. Also included are non-gap financial measures, which should be considered only as a supplement to and not a substitute for or superior to gap measures.
Kyle: To the extent applicable, please refer to the tables at the end of our press release for reconciliations of these measures to the most directly comparable gap measure. During today's call, Tom McCourt, our president and interim CEO, will review our strategic priorities, highlight today's announcement regarding our new share of purchase program, and summarize our commercial performance for Linzest. Then Gina Consolman, our CFO, will review our first quarter 2021 financial results and
<unk> are present interim CEO or review, our strategic priorities highlight today's announcement regarding a new share repurchase program and summarize our commercial performance for Linzess.
And Gina complement our CFO will review, our first quarter of 2021 financial results and guidance makes shut sign our CMO will also be available for the Q&A portion of the call.
Kyle: Mike Shettsline, our CMO, will also be available for the Q&A portion of the call. We'll be referring to slides via the webcast. For those of you dialing in, please go to the event section of our website to access the webcast slides. With that, I'll turn the call over to Tom. Thanks, Mary.
We will be referring to science via the webcast for those of you dialing in please go to the events section of our website to access the webcast side with that I'll turn the call over to Tom.
Good morning, everyone and thanks for joining us today.
Thomas A. McCourt: Thanks, Meredith. Good morning, everyone, and thanks for joining us today. We had a solid start to 2021, as demonstrated by strong Linzest performance continuing its momentum from 2020 and another quarter of delivering profitability and positive cash flow. We are steadfast in our mission and importantly remain focused on our goals of driving value to our shareholders by bringing important medicines to patients and building a growing and successful business. Our strategy starts with maximizing Linzuss.
We had a solid start to 2021 is demonstrated by strong Linzess performance continue neutral minimum from 2020 and another quarter of delivering profitability in positive cash flow.
We are steadfast in our mission and importantly remain focus on our goals you driving value to our shareholders by bringing important medicines to patients and building a growing and successful business.
Our strategy starts with maximizing Linzess linzess continue to demonstrate double digit growth in demand in the first quarter, resulting in U S. Net sales of $250 million or 12% growth year over year, and we believe there's substantial opportunity for continued growth moving forward.
Thomas A. McCourt: Linzest continued to demonstrate double-digit growth in demand in the first quarter, resulting in U.S. net sales of 215 million, or 12% growth year over year. And we believe there's substantial opportunity for continued growth moving forward. We're seeking to build an innovative portfolio, both through the development of internal assets, such as our own IW 3,300, for the potential treatment of visceral pain conditions, and through bringing in external assets that target serious organic GI diseases.
Second.
We're seeking to build an innovative portfolio bold through the development of internal assets, such as our own IW 3300 for the potential treatment of visceral pain conditions and through bringing it external assets that target serious organic Gi diseases.
And finally, we're focused on generating sustainable cash profits and cash flow. We ended the first quarter with nearly $440 million in cash on our balance sheet and increase of 75 million versus the fourth quarter and 2020.
Thomas A. McCourt: And finally, we're focused on generating sustainable cash profits and cash flow. We ended the first quarter with nearly $440 million in cash on our balance sheet, an increase of $75 million versus the fourth quarter of 2020. Our strong financial position and our performance today provide us with the ability to simultaneously invest thoughtfully in our strategic priorities, as we just highlighted, and be in a position to also return cash to shareholders. We announced this morning that our board has authorized a share repurchase program, under which we may purchase up to $150 million of outstanding shares of Ironwood Common Stock through December 2022.
Are strong financial position and our performance of day provides us with the ability to simultaneously invest thoughtfully and a strategic priorities as we just highlighted and be in a position to also return cash to shareholders.
We announced this morning that our board is authorized to share repurchase program under which we may purchase up to $150 million, an outstanding shares of Ironwood common stock through December 2022.
We maintain a disciplined and thoughtful approach to capital allocation and are committed to strategically deploying capital, where we believe it can drive the greatest value towards shareholders.
Thomas A. McCourt: We maintain a disciplined and thoughtful approach to capital allocation and are committed to strategically deploying capital where we believe it can drive the greatest value to our shareholders. The share repurchase program is aligned with that commitment and underscores the strength of our financial position. Now, let's turn to commercial performance.
The share repurchase program is aligned with that commitment and underscores the strength of our financial position.
Now, let's turn to the commercial performance.
Thomas A. McCourt: Linzest performed remarkably well in the first quarter. Prescription demand grew 12% year over year, with LinzSSS continuing to strengthen its position as the number one prescription treatment in the U.S. for adults with IBSC and chronic constipation, with approximately 40% market share in the category. Newterbrand prescriptions increased 24% Eurovere, significantly outpacing the IBSC, a chronic constipation. This is an all-time high for Linzess, reinforcing that patients and healthcare practitioners continue to choose LinzSS. 90-day prescriptions also continue to represent a significant number of total lens prescriptions. In the first quarter, 90-day prescriptions made up nearly 20% of visits.
Thomas A. McCourt: This strong performance reaffirms our confidence that Linz has the potential to exceed a billion dollars in U.S. net sales, with several additional opportunities to drive even further growth. The success of the lens to date in the U.S. has come through consistent and strong execution of the commercial strategy that's grounded in three core fundamentals: increasing awareness of Linz Us amongst physicians, motivating appropriate patients to seek care and request Linzis, and securing broad payer access.
Thomas A. McCourt: We believe the growth that we achieved in the first quarter is in part a reflection of the success of this strategy and the positive experience that physicians have had with Linzac. In addition, Linz remains the class leader in formulary access, important for supporting both existing and new patients. We also believe that the brand continues to demonstrate strong promotional responses. Since the beginning of the year, we've evolved the marketing mix to further support our consumer media strategy.
Straight strong promotional responsiveness.
Since the beginning of the year, we've evolved the marketing mix to further support our consumer media strategies. This includes a fully refresh consumer campaign they'll launch in early April which now incorporates the IBSA overall abdominal symptom data.
Thomas A. McCourt: This includes a fully refreshed consumer campaign that launched in early April, which now incorporates the IBSC overall abdominal symptom data. We expect this new campaign to have a meaningful impact on patients and the brand. Also, our skilled and experienced sales force has been gaining a high level of in-person meetings with physicians, achieving access comparable to pre-COVID levels. Additionally, there has been a significant increase in online searches and clicks for constipation-related terms. And we are also seeing higher traffic to the Lin-Sess website, suggesting that more patients are seeking treatment options for their IBSC and constipation-related symptoms. In the first quarter, we experienced a significant increase in the number of visitors to www.linsess.com. With about 400,000 unique visitors a month, this represents a 70% increase year over year.
We expect this new campaign to have a meaningful impact on patients and the brand.
Also are skilled and experienced sales force have been gaining at high level of in person meetings with physicians achieving access access comparable to pre COVID-19 levels.
Additionally, there's been significant increase in online searches and clicks for constipation related terms.
And we are also seeing higher traffic to the Linzess website, suggesting that more patients are seeking treatment options for their ibs C and constipation related symptoms.
And the first quarter, we experienced a significant increase in the number of visitors to Linzess dot com with about 400000 unique visitors a month. This represents a 70 per cent increase year over year.
Finally, recent survey day to also suggest that there's been a significant increase in overall prevalence of IBSA and chronic constipation in adults in the U S.
Thomas A. McCourt: Finally, recent survey data also suggest that there's been a significant increase in overall prevalence of IBSC and chronic constipation in adults in the U.S. New data on prevalence and the burden of illness will be presented at DDW in a few weeks. These data illustrate the growth potential for Linzas for appropriate patients, particularly in their relief of overall abdominal symptoms associated with IBSC. We're looking forward to the upcoming DDW meeting, where Ironwood and Abbey will be presenting seven scientific posters, four of which have been developed in partnership with Abbey, and four of the seven have been named posters of distinction.
New data on prevalent and the burden of illness will be presented a D. D. W. In a few weeks these.
These data illustrate the growth potential for linzess for appropriate patients, particularly on their relief of overall abdominal Simpsons associated with IBSA.
We're looking forward to the upcoming D. D W meeting, where ironwood and Abby will be presenting seven scientific pollsters four of which have been developed in partnership with Abby and four of the seven have been named posters of distinction.
In addition to the day band catalysts are highlighted we continue to believe that our investments in telemedicine may help advance access to physician care for for G. I patients in need and our commitment to exploring lifecycle management initiatives present, an opportunity to expand the clinical utility Berlin appetite.
Thomas A. McCourt: In addition to the demand catalysts I highlighted, we continue to believe that our investments in telemedicine may help advance access to physician care for GI patients in need, and our commitment to exploring life cycle management initiatives presents an opportunity to expand the clinical utility of Linacru. We believe both these efforts will serve as key drivers for continued growth moving forward. Just a few final comments before I turn it over to Gina.
We believe both these efforts will serve as key drivers for continued growth moving forward.
Just a few final comments before I turn it over to Gina.
As we look forward.
Thomas A. McCourt: As we look forward, we recognize that GI remains a therapeutic area with a significant unmet need, with millions of highly symptomatic and suffering patients and diseases that often have limited or no treatment options. We have a strong, experienced team with the knowledge and expertise to advance innovative science and build successful brands. I'd like to take a moment to thank all of our employees, patients, caregivers, and advocates in the GI community for their shared dedication to advancing and supporting our efforts in this underserved market. With that, I'll turn the call over to G5. Thanks, Tom.
We recognize that Gi Gi remains a therapeutic area with a significant unmet need with millions of highly symptomatic and suffering patients and diseases that often have limited or no treatment options.
We have a strong experienced team with the knowledge and expertise to advanced innovative science and build successful brands.
I'd like to take a moment to thank all of our employees patients caregivers and advocates in the G. I community for their share dedication to advancing and supporting our efforts in this under served market with that I'll turn the call over to G.
Thanks, Tom and good morning, everyone. It's wonderful to be in a position to report such great financial performance.
Gina Consolman: Thanks, Tom, and good morning, everyone. It's wonderful to be in a position to report such a great financial performance. I have a few updates to provide today. First, I'll walk through the financial performance for Q1, then I'll review our 2021 guidance, and finally, I'll touch on our capital allocation strategy and provide a few closing thoughts. Please refer to our press release for our detailed financial information. In the first quarter of 2021, Ironwood revenues were $89 million, up 11% year over year, driven primarily by U.S. LinzS. collaboration revenues of 86 million.
Do updates to provide today first I'll walk in the financial performance parking one.
You are 2021 guidance and finally, I will touch on our capital allocation strategy and provide a few other thank god. Thank.
Thank you sorry to our press release for a detailed financial information.
And the first quarter of 2021, Ironwood revenues for 89 million other 11 per cent year over year, driven primarily by U S. Linzess collaboration revenues at 86 million our core business you ask Linzess collaboration revenues increased 21% compared to the first quarter of 2020.
Gina Consolman: Our core business U.S. Linzest collaboration revenues increased 21% compared to the first quarter of 2020. Moving to Lendez, as Tom mentioned, U.S. net sales grew 12% compared to the first quarter of 2020. Net sales growth was driven by robust prescription demand and favorable inventory channel fluctuation, partially offset by net price erosion. We continue to expect mid-single-digit net price erosion for the full year.
Moving to Linzess as Tom mentioned U S net sales growth, 12% compared to the first quarter of 2020 net sales growth from Australia by robust prescription demand and favorable inventory channels actuation.
Partially offset by net price erosion, we continue to expect mid single digit net price erosion for the full year and regarding the channel we anticipate fewer channel fluctuations for the remainder other year due to tighter inventory management.
Gina Consolman: And regarding the channel, we anticipate fewer channel fluctuations for the remainder of the year due to tighter inventory management. We are on track to achieve our U.S. LinzS. net sales guidance of 3 to 5% growth year over year in 2021. While we exceeded these growth rates in the first quarter, it is still early in the year, and we will continue to monitor demand, price, and inventory moving forward. Turning to Linse brand profitability, the commercial margin in the first quarter was 73%.
We are on track to achieve R. U S. Linzess net sales guidance at 3% to 5% growth here over a year in 2021.
Well, we exceeded these growth rates in the first quarter. It is still early in the year and we will continue to monitor demand price and inventory moving forward.
Turning to Linzess brand profitability commercial margin in the first quarter was 73% we continue to seek to expand margins over time for going Linzess net sales and disciplined investment behind the brand.
Gina Consolman: We continue to seek to expand margins over time through growing Lenz S net sales and disciplined investment behind the brand. Now to Ironwood's profitability. Gap net income was $40 million, and adjusted EBITA was $46 million in the first quarter.
No the iron, which profitability GAAP net income was 40 million and adjusted EBITDA was 46 million in the first quarter.
Gina Consolman: Now let's review our 2021 guidance. In addition to continuing to expect Linzacnet sales growth in 2021, as I mentioned earlier, we continue to expect total ironwood revenue of 370 to 385 million and adjusted EBITA of greater than 190 million for the year. Moving to cash and capital allocation priorities. In the first quarter, we generated $74 million in cash flow from operations and ended the quarter with $438 million in cash and investments, up from $363 million in the fourth quarter of 2020.
Gina Consolman: Being a profitable biotech company, delivering meaningful cash flow, is a fortunate and unique position to be in, and a long way from where we were just a few years ago. We are committed to strategically deploying capital where we believe we can drive the greatest value for our shareholders. I am thrilled as CFO that this strong financial position has given us the ability to simultaneously invest thoughtfully in our GI strategy and also return cash to our shareholders. As Tom highlighted, our board has authorized a share repurchase program through which we can buy back up to $150 million of Ironwood common stock through December 2022.
Gina Consolman: To be clear, this program is aligned with our strategic priorities, and we do not expect it to constrain our efforts to maximize Lenz earnings, build an innovative GI pipeline, and deliver profits and cash flow. To wrap up, we had a solid start to the year. Our strong results are reflective of our investments, and we believe we are in a great position to develop innovative assets in the GI space. Looking ahead, we are focused on advancing our three strategic priorities.
Gina Consolman: We have built a strong foundation, and we are excited about the opportunities ahead of us to improve the lives of GI patients and deliver shareholder value. Thanks again for joining us this morning. Operator, you may now open up the line for questions. At this time, we would like to take any questions you may have. To ask a question, please press star 1 on your telephone keypad. Your first question is from Jacob Hughes with Wells Fargo. Your line is open.
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Thanks again for joining us. This morning, operator, you may now open up the line for questions.
At this time, we would like to take any questions. You may have to ask a question. Please press star one on your telephone keypad. My first question is from Jacob Hughes with Wells Fargo. Your line is open.
Uh huh.
Hi, Thanks for taking my question Julia if I just look at the first quarter results for Linzess, it's 12% growth.
Jacob William Hughes: Hi, thanks for taking my question. Gene, if I just look at the first quarter results for Linzast, 12% growth, and, you know, I know you called it out really through the first quarter, but, you know, the full year,
You know I know you I know you called out <unk> through the first quarter, but the other full year guidance does this to or it does imply a deceleration through the year.
Jacob William Hughes: Could you just provide some additional color on that, both the RX demand side and pricing? I mean, is this conservative, or do you think it's just realistic?
Could you just provide some additional color on that on bolt on you are on demand side and on pricing I mean is this conservative or do you think is realistic.
Gina Consolman: Hi, good morning. It's a great question, and it's certainly one that we took a hard look at. You know, we always look at our performance for the quarter and then take a look at the guidance expectations for the year. And certainly your question is when we asked ourselves that as well.
Hi, good morning.
Great question and it's certainly one that you know we took a hard look at you know we always look at our performance for the quarter and then take.
Take a look at the guidance expectations for the year and certainly your question is when we asked ourselves as well one you know, we're just thrilled with 12% demand growth year over here, especially where we are I think it's the eight here you know post launch at this point.
Gina Consolman: So one, you know, we're just, you know, thrilled with 12% demand growth here over year, especially where we are. I think it's the eighth year, you know, post-launch at this point, and it's fantastic to see the growth. But, you know, I go back to a couple things, two of which I guess I mentioned in the script.
Fantastic to see the growth, but you know I go back to a couple of things.
Two of which I guess I mentioned in the script. So one it's just early right. It's the first quarter for the full year and two I talked about expectations for tighter.
Gina Consolman: So one, you know, it's just early, right? It's the first quarter for the full year. And two, I talked about expectations for tighter inventory management this year. So what does that mean?
Inventory management. This year. So what does that mean that means you know if you think about prior years, we would see some seasonal changes in the inventory we would typically see some burn and actually kind of significant burn in the first part of the year and then we would see build in the second part of the year.
Gina Consolman: That means, you know, if you think about prior years, we would see some seasonal changes in the inventory. We would typically see some burn, you know, and actually kind of significant burn in the first part of the year. And then we would see build in the second part of the year. And if you think, you know, if you compare that to what we're expecting this year, so if we expect a more stable inventory balance for the full year, less burn in the early part of the year, so where we are in Q1, for instance, contributes to higher Lins-S net sales growth year over year.
And if you think you know if he.
Compare that to what we're expecting this year. So if we expect a more stable inventory balance for the full year.
Less burn in the early part of the year, So where we are in Q1 for instance contributes to higher Linzess net sales growth year over year. So the first part of the year you have higher growth rates right.
Gina Consolman: So in the first part of the year, you have higher growth rates, right? And then you think about the second part of the year where we'll have less build compared to the prior year, and that will contribute to lower Lins-S net sales growth rates year over year. So think about that dynamic in combination with, obviously, demand, which we're really pleased with, and then the pricing guidance that we continue to guide to, which is around mid-single-digit price erosion for the year.
Think about the second part of the year, where we'll have less build compared to the prior year and that will contribute to lower linzess net sales growth rates year over year. So think about that dynamic in combination with obviously the demand, which we're really pleased with and then the price in guidance that we continue to guide too which is around mid single digit price erosion for the year.
Okay got it and then just on.
Jacob William Hughes: Okay, got it. And then just on... You know, the buyback, and, you know, Maybe you could provide some additional color on how you're thinking about the pipeline beyond 3,300. He talked about bringing in additional assets, which is the criticizing color on the stage in time.
On.
On the buyback Kim.
Just maybe you can provide some additional color on how you're thinking about the pipeline.
3300, you talked about bringing on some additional assets as is.
Could you provide some color on the stage and timing of those assets in light of the buyback and the upcoming convertible debt next year.
Jacob William Hughes: of those assets in light of the buyback and
Jacob William Hughes: and the upcoming convertible debt and next year.
Sure maybe I'll start if that's okay on the financial part of the buyback and I can turn it over to Tim I can tell them if they want to jump in on.
Gina Consolman: Sure, you know, maybe I'll start, if that's okay, on the financial part of the buyback, and I can turn it over to Mike and Tom if they want to jump in on more of the specifics that we're looking for for the assets. But one, you know, it's just a great quarter. I'm thrilled to be able to announce this.
On a more of the specifics on where we're looking for for the assets, but one you know, it's just a great quarters I'm thrilled to be able to announce this.
If I think back for the last couple of years, we have periodically received questions about when we would be able to return cash to our shareholders.
Gina Consolman: You know, if I think back over the last couple of years, we have periodically received questions about when we would be able to return cash to our shareholders. Up until now, I really didn't think we were in that place. You know, if I and I started with probably a low point of 100 million dollars post-spin and close to $500 million of debt. And all that debt, if you recall, was due at roughly the same time.
Up until now I really didn't think we were in that place.
He started with probably a low point of $100 million post spin and close to $500 million of debt and all of that debt. If you recall was due at roughly the same time and so fast forward now it's just over two years post separation, we have $440 million on cash on the balance sheet, we are guiding to a greater than 190 million.
Gina Consolman: And so, you know, fast forward now. It's just over two years post-separation. We have $440 million in cash on the balance sheet. We're guiding to greater than $190 million of EBITA this year, which is a nice proxy for cash generation. And the debt's been nicely spaced between 22, 24, and 26. We remain committed to paying off the $22.
Of EBITDA this year, right, which is a nice proxy for cash generation and the debt spend nicely spaced between 20 to 24 and 26, we remain committed to paying off 20 to convert in cash. We've also said that we have expectations for 'twenty, four and 'twenty six to possibly pay that off in cash as well. So if you just think about <unk>.
Gina Consolman: We've also said that we have expectations for 24 and 26 to possibly pay that off in cash as well. So if you just think about all of that, I think we're in a great position to have this $150 million cash buyback or the stock buyback. And I think it does not impact our ability to continue to invest in our strategy. So, you know, our strategy is maximizing Lins-SS, building out our pipeline, and growing profitability.
All of that I think we're in a great position to have this $150 million cash buyback.
On our that stock buyback.
And I think it does not impact our ability to continue to invest in our strategy. So you know our strategy is maximizing linzess building on our pipeline and growing profitability. We are full investment behind Linzess you can see that in the numbers for the year on we're guiding to that for the year and the pipeline. We're continuing to look at assets to bring in and I think as we're looking at these as.
Gina Consolman: We have full investment behind Lins-S. You can see that in the numbers for the year. Leading to that for the year. And in the pipeline, we're continuing to look at assets to bring in. And I think as we're looking at these assets, you know, by the time we bring an asset in, and, you know, I would love to see the assets brought in sooner rather than later, right? And we're all really excited to bring something in this year. But if you think about just the pace of bringing in the assets, I think we're very confident that we can fund these asset acquisitions and still remain profitable.
As you know by that by the time, we bring the asset in and you know I would love to see the asset brought in sooner rather than later right and we're all really excited to bring something in this year, but if you think about just the pace of bringing in the assets I think we're very confident that we can fund these asset acquisitions and still remain profitable.
Thanks very much.
Jacob William Hughes: Thanks very much.
Your next question is from Eric Joseph with Jpmorgan. Your line is open.
Operator: Your next question is from Eric Joseph with J.P. Morgan. Your line is open. Good morning. This is Hannah on behalf of Eric. Thanks for taking the question. Just a few from us. So first, give Laurie your asset that you're developing or marketing in partnership with an online loan. How much of a revenue generator do you think that asset could become for Ironwood? And does the exposure in hepatic disease and that treating community factor into your BD prioritization numbers? And I have a follow-up after that.
Good morning vs. Hannah on for Eric Thanks for taking the question just a few from US. So first on give Laurie you're all set that you're developing or marketing in partnership with them on my mom how much of a revenue generator or do you think that on because that could become for ironwood and does the exposure in here.
Panic disease in that trading community factor into your BD prioritization on them and I have a follow up after that.
Yeah, maybe I can this is Tom maybe I'll take.
Thomas A. McCourt: Yeah, maybe I can, this is Tom. Maybe I'll take, you know, I'll take that question. Obviously, this was a really, we think, a sound strategic move for us. One, you know, to be able to contribute to, you know, real innovation in the marketplace, particularly, you know, among our customers in GI as well as hepatology. And, you know, our primary objective early on was working with Nylon to identify additional patients, which we've successfully done. What's happening right now is we've identified a pretty sizable pipeline of patients that now, you know, we're working with Il So these are patients that are highly symptomatic, have been diagnosed, and have a positive test for AHP. And, you know, we're moving them through. So, I mean, it's still relatively early on.
I'll take that question, obviously this was a.
Really we think is solid strategic move for us one to be able to contribute to a real innovation in the marketplace, particularly among our customers in Gi as well as herpetology and our primary objective early on was working with an island to identify.
Additional patients, which we've successfully done what's happening right now is we've identified a pretty sizeable excuse me a sizeable.
Pipeline of patients that now we're working with in Ireland to get on to drug. So these are patients that are highly symptomatic have been diagnosed to have a positive test for HP and <unk>.
Moving them through so I mean, it's still relatively early on we've certainly exceeded our expectation with the number of patients that we have found that the number of patients that they put on drug but it's it's it's a little challenging to speculate overall, how big that opportunity is going to be for us I think we'll have a better lineup.
Thomas A. McCourt: We've certainly exceeded our expectations with the number of patients that we have found and the number of patients that they have put on the drug. But it's a little challenging to speculate overall. how big that opportunity is going to be for us. I think we'll have a better line of sight towards the end of the year as we pull the patients through that we've identified, and then, you know, how many more additional patients can we identify through a number of different means that we're deploying with our sales force.
Towards the end of the year as we pull the patient through that we've identified and then how many more additional patients can be identified through a number of different means.
That we are deploying with our sales force.
And again I think the other the other piece of this is really understanding what it takes to succeed.
Thomas A. McCourt: And again, I think the other piece of this is really understanding what it takes to succeed in the rare disease space, which is obviously an area that we may be interested in if it's a GI-related disease. And as far as the adjacency of hepatology is concerned, I mean, it is clearly an area that may be of interest to us because of the common call point, because as you know, the vast majority of patients suffering from abatic disease are actually managed by gastroenterologists due to the limited number of hepatologists out there.
In the rare disease space, which is obviously an area that we may be interested in if it's a gi related disease.
And as far as the adjacency of Herpetology I mean, it is clearly an area that may be of interest to us because of the common call point because as you know you know the far majority of our patients suffering from Abatic disease are actually managed by Gastroenterologists due to the limited number of Herpetologist out there so.
Thomas A. McCourt: So, overall, I think we're delighted with the progress we've made. And Ilems has been a terrific partner. And, you know, we're really, you know, helping an awful lot of patients in a very, very debilitating process.
Overall I think we are delighted with the progress we've made on <unk>.
Ireland has been a terrific partner and we are really helping an awful lot of patients.
On a very very debilitating disease.
Great that's helpful and for I W. W.
Thomas A. McCourt: Great, that's helpful. And for IW 3,300, you had mentioned that you are guiding towards an I&D filing within the first half of 2021. So in terms of dating items, beginning that's submitted, one of the remaining items on the blue list, and then also, are you able to share what you're thinking of in terms of potential phase one trial design and endpoints of interest?
IW 3300.
You had mentioned that you are guiding towards an IND filing within the first half of 'twenty 'twenty. One so in terms of gating items to getting that submitted what are the remaining items on the list and then also are you able to share what you're thinking of in terms of potential phase one trial design and endpoints of interest.
Yes, I apologize you broke up a little bit so I just want to make sure I understood. It. So what I'll do is I'll ask Mike <unk>, our chief medical officers to kind of share kind of where we are with the D and.
Operator: Yes, I apologize; we broke up a little bit, so I just want to make sure I understood it. So, you know, what I'll do is I'll ask Mike Shetzline, our chief medical officer, to kind of share kind of where we are with the IND in the progress as well as, you know, what the next step is in trial design. And then, you know, we can come back and talk a bit more about how we're viewing the asset and how we might think about monetizing that asset.
And the progress as well as you know what is the next up on trial trial design and then we can come back and talk a bit more about kind of how we're viewing the asset.
How we might think about monetizing that asset.
Yeah, Mike Thanks, Tom It's a good question and we remain on track with IW three 300 for the IND submission for the second half of 2021 and as you know, we're actually pursuing that for intercept interstitial cystitis bladder pain syndrome, and the key point there to recognize is that even though you may not think of that as a gi.
Michael Shetzline: Yep, Mike. Thanks, Tom. It's a good question.
Michael Shetzline: We remain on track with IW 3300 for the I&D submission for the second half of 2021. And as you know, we're actually pursuing that for interstitial cystitis and bladder pain syndrome. And the key point there to recognize is that even though that's, you may not think of that as a GI indication, you need to understand that from mechanistically how IW. 3300 acts is actually in the colon. And it's actually based on the cross-call hypothesis, which we think we're going to be able to
<unk> you need to understand that the per Mechanistically, how IW 3300 acts is actually in the colon and Thats actually based on cross talk hypothesis, which we think we're going to be able to demonstrate hopefully clinical data to support that when we get into the clinical program and how that works is that we know that inflammation or underlying disease.
Michael Shetzline: to demonstrate, hopefully,
Michael Shetzline: to support that when we get into the clinical program. And how that works is that inflammation or underlying diseases of the gut can actually cause different sensitivity in other abdominal organs, like the pelvic organs or the bladder. So we really look at targeting IW3300 to the colon as a real opportunity to help pain syndromes like bladder pain syndrome. So again, we're on track for I&D at the end or the second half of 2021 and starting a clinical program soon thereafter.
<unk> of the gut can actually cause different sensitivity and other abdominal organs like pelvic organs or to bladder.
So we really look at targeting ITW 3300 to the colon is a real opportunity to help pain syndromes like bladder pain syndrome. So again, we're on track for ion day at the end or second half of 2021 I'm, starting a clinical program soon thereafter.
Michael Shetzline: And Mike, as far as the PACs,
And Mike as far as the park, so what would that look like yeah. Thanks. Thanks for reminder, so the design is obviously will get safety and Tolerability data first but we're really trying to move rapidly to a path to proof of concept study and the proof of concept study will be in bladder pain syndrome patients. So we're going to look at an endpoint of relevance to bladder pain syndrome patients will work with external.
Michael Shetzline: What would that look like? Yeah, thanks for the reminders. So the design is obviously we'll get safety and tolerability data first, but we're really trying to move rapidly to a Pock proof of concept study in bladder pain syndrome patients. So we're going to look at an end point of relevance to bladder pain syndrome patients. We're working with external experts to get granular on those endpoints. And we're going to have a design, you know, obviously sometime later in the year as well, that we can present to the health authorities to start the clinical program. Yeah, I think as far as
Experts to get granular on those endpoints.
We're going to have a design obviously sometime later in the year as well that we can present to health authorities to start the clinical program, Yeah, I think as far as the asset itself.
Thomas A. McCourt: Yeah, I think as far as, you know, the asset itself, as the team thinks about this, obviously, it's a wholly owned asset. We know the drug, certainly, we know how it acts, we know the drug is safe, we know we can manufacture it. We have confidence we can deliver it at the site of action, and certainly, the pre-clinical data has been very, very positive with regard to this cross-talk mechanism that Mike spoke about.
Team thinks about this obviously, it's a wholly owned asset.
We know the drug certainly.
We know how it acts we know the drug is safe. We know we can manufactured we have confidence we can deliver it at the site of action and certainly the preclinical data has been very very positive with regard to this cross talk mechanism that Mike spoke with.
Thomas A. McCourt: And, you know, with a modest investment, we can get to at least a proof of concept. And at that point, we can make a decision as to where we go with the asset, whether we out-license it or, you know, develop it ourselves. But obviously, this is a valuable asset, and we certainly want to make the most of the opportunity.
And with a modest investment we can get to at least the proof of concept and at that point, we can make a decision as to where we go with the asset whether we out license it or do we develop ourselves, but obviously this is a valuable asset and we certainly want to make the most of the opportunity.
Okay, Great that's helpful and thanks for taking the question.
Operator: Okay, great, that's helpful. Thanks for taking your question. Sure. Again, if you'd like to ask a question, please press star, followed by the number one on your Tilsen keypad. Your next question is from David Lovewood with Morgan Stanley. Your line is open. David, your line is open.
Sure.
Again, if you'd like to ask a question. Please press star followed by the moving.
One on your telephone keypad.
Your next question is from David Lebowitz with Morgan Stanley. Your line is open.
Okay.
Yeah.
David Your line is open.
Alright, sorry, I had on mute Mike.
David Lovewood: Sorry, I had the mute on. My question is on the cadence of the sales for the quarters. Clearly, volume growth was pretty good in the quarter. I know that the first quarter is typically a down quarter. The fourth quarter last year was quite strong. How can we expect the cadence to go as the year goes on? I know that it tends to get stronger as the year progresses. Will we expect that trend to continue? Will it be quite as sharp as it was last year because last year the first quarter versus the fourth quarter was quite substantially different? So how should we expect to look at it this year?
My question is on cadence of sales for the quarters clearly volume growth was pretty good in the quarter.
I know that the first quarter is typically a down quarter fourth quarter last year was quite strong on how can we expect.
The cadence to go as the year goes I know that it tends to get stronger as the year progresses.
Will we expect that trend to continue will it be quite as sharp as it was last year because last year, the first quarter versus the fourth quarter were quite substantially different.
So how should we expect to look at it this year.
Yes, David This is Tom maybe I'll take a whack at it.
Thomas A. McCourt: David, this Tom, maybe I'll take a whack at it. And, you know, this is a really... It's really remarkable what we're seeing. To your point, there traditionally has been clear seasonality in the drug where, due to the high-deductible plans, we see a dip in January and February, usually March, April, and May; it starts accelerating, it slows down over the summer, and then accelerates in the back end of the year. And certainly, the pandemic, I think, has made a difference here. There's no question about that.
And.
This is a really.
It's really remarkable what we're seeing to your point, they're traditionally has been clear seasonality in the drug where due to the high deductible plans, we see a dip in January February March.
March and April and May it starts accelerating it slows down over the summer and then accelerates in the back end of the year and it is.
Certainly the pandemic I think has made a difference here. There is no question I think we saw a very strong fourth quarter, but as you mentioned we saw.
Thomas A. McCourt: I think we saw, you know, a very strong fourth quarter, but as you mentioned, we saw an extraordinarily strong first quarter. And the question is why and where is that source of business coming from? And as I mentioned, you know, we're seeing a tremendous amount of traffic, certainly on the Internet, but also on our website. I mentioned, you know, we're seeing like 400,000 unique visitors a month. That's up 70% from where we were a year ago. In addition, we collaborated with the University of Michigan and Cedar Sinai to conduct a rather large GI survey, which replicated a survey we did five years ago with them.
Strong neroli strong.
First quarter and the question is why and where is the source of business coming from <unk>.
As I mentioned, we're seeing a tremendous amount of traffic.
Certainly on the Internet, but also to our website I've mentioned, we're seeing like 400000 unique visitors a month thats up 70% from where we were a year is a year ago. In addition, we collaborated with the University of Michigan, and Cedars Sinai to conduct a rather large Gi survey.
Which replicated a survey we did five years ago with them and there is a clear increase in the prevalence of the disease. So it looks like this.
Thomas A. McCourt: and there's a clear increase in the prevalence of the, So it looks like, you know, this buoyancy of the overall prevalence looks encouraging. But, you know, as Gina mentioned, we're excited about what we're seeing. We've clearly seen an inflection point in demand, particularly with new to brand. But, you know, we're certainly cautiously optimistic as we're looking forward.
This buoyancy of the overall prevalence looks encouraging but you know as Gina mentioned.
We're excited on what we're seeing we've clearly seen an inflection point in demand.
Particularly with new to brand, but we're certainly cautiously optimistic as we're looking forward.
Yeah, David if I could just quickly add just keep in mind my inventory comments that I mentioned earlier right we love.
Gina Consolman: Yeah, David, if I could just quickly add, just keep in mind my inventory comments that I mentioned earlier, right? We won't, obviously net sales is a combination of demand, price, and inventory movement, and we won't see the same, or at least we're not anticipating, right now, the same level of burn in the first part of the year and the same build in the second part of the year to contribute to, you know, where we have typically seen higher net sales in the fourth quarter due to some bills.
Obviously net sales is a combination of demand price and inventory movement and we won't see the same.
At least we're not anticipating right at this time the same level of burn in the first part of the year on the same build in the second part of the year to contribute to where.
Where we have typically seen higher net sales in the fourth quarter cash or something else.
Okay.
Excellent. Thank you very much for taking my question.
David Lovewood: Excellent. Thank you very much for taking the time to answer my question.
Thanks, David.
Operator: We have no further questions at this time. I'll turn the call back to the presenters for closing remarks.
We have no further questions at this time I'll turn the call back to presenters for closing remarks.
Well I just wanted to close by certainly thanking all of you for joining us today on.
Thomas A. McCourt: Well, I just want to close by, you know, certainly thanking all of you for joining us today. And, you know, it's been a terrific first quarter. I think, I speak on behalf of the management team, that we've stayed true to our promise, you know, to shareholders. We've executed well on the core strategy that we outlined two years ago, as Gina shared with you earlier.
It's been a terrific.
First quarter I think the way I know.
I speak on behalf of the management team that we've stayed true to our promise to shareholders. We've executed well on the core strategy that we outlined two years ago.
<unk> shared with you earlier, but I think we're extremely optimistic with regard to what we're seeing and what we're what we're doing and I think we're looking forward to following up with you at the end of next quarter to see kind of where we are and I think we'll have a much better line of sight of what the year will look like.
Thomas A. McCourt: But I think we're extremely optimistic with regard to what we're seeing in, and, in, in, in, in, in, in, in, in, in, what we're doing. And I think we're looking forward to, you know, following up with you at the end of next quarter to see kind of where we are. And I think we'll have a much better line of sight of what the year will look like. So thanks for your time.
So thanks for your time.
Operator: This concludes today's conference call. You may now disconnect.
This concludes today's conference call you may now disconnect.
Okay.
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