Q4 2021 Xeris Biopharma Holdings Inc Earnings Call
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Hello everyone and welcome to the Xeris Biopharma fourth quarter 2021 financial results conference call and webcast. My name is Seb and I'll be the operator for your call today. There will be an opportunity to ask a question and if you would like to do so, please press star 1 on your telephone keypad or press star 2 if you wish to withdraw your question.
Hello, everyone and welcome to the is there a supply of pharma fourth quarter 2021 financial results Conference call and webcast. My name is <unk> and I'll be the operator for your call today.
There will be an opportunity to ask your question and if you would like to do so please press star one on your telephone keypad will pressure start to if you wish to withdraw your question I will now hand, the floor over to Alison White to begin. Please go ahead.
I will now hand the floor over to Alison Way to begin, please go ahead.
Alison Way: Thank you. Good morning and welcome to Xerox Biopharma's fourth quarter of 2021 financial results and corporate update conference call-in webinar.
Thank you good morning, and welcome to Zurich, Biopharma fourth quarter of 2021 financial results and corporate update conference call and webcast.
Alison Way: A press release of the company's fourth quarter and full year 2021 financial results was issued earlier this morning and can be found on our website.
Yes release with the company's fourth quarter and full year 2021 financial results was issued earlier this morning and can be found on our website.
Alison Way: We are joined this morning by Paul Edick, Chairman and CEO , and Steve Piper, our CFO . Paul will provide opening remarks, Steve will provide details on our financial results, and then we will open the call for Q&A.
Im joined this morning by Paul Edick, Chairman, and CEO and Steve <unk>, Our CFO , Paul will provide opening remarks, Steve will provide details on our financial results and then we will open the call for Q&A.
Alison Way: Before we begin, I would like to remind you that this call will contain forward-looking statements concerning Veris' business practice.
Before we begin I would like to remind you that this call will contain forward looking statements concerning their business practices <unk> future expectations plans prospects clinical approval commercialization corporate strategy performance and the impact of COVID-19 on their business practices.
Alison Way: There's a future expectations, plans, prospects, clinical approval, commercialization, corporate strategy, performance, and the impact of COVID-19 on their decision.
Paul R. Edick: which contain forward-looking statements for the purposes of the safe harbor provision under the Private Securities Litigation Reform Act of 1998.
Contain forward looking statements for the purposes of the Safe Harbor provision under the private Securities Litigation Reform Act of 1995.
Paul R. Edick: Actual results may differ materially from those indicated by these forward-looking statistics.
<unk> results may differ materially from those indicated by these forward looking statements as a result of various important factors, including the effects of uncertainties related to the COVID-19 pandemic on the U S and global markets. There is a business financial condition operations clinical trials, and third party suppliers and manufacturers and other risks including those.
Paul R. Edick: as a result of various important factors, including the effective uncertainties related to the COVID-19 pandemic on the U.S. and global markets, services, business, financial conditions, operations, clinical trials, and third-party suppliers and manufacturers, and other risks, including those discussed in our filings with the FDA.
That's not filings with the SEC.
Paul R. Edick: 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.
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 will now turn the call over to colleagues.
Paul R. Edick: to specifically disclaim any obligations to update such statements.
Speaker Change: Good morning, everyone. Thanks for joining us today. This morning, I'll review our 2021 accomplishments and then focus my remarks on our 2022 plans and outlook.
Good morning, everyone. Thanks for joining us today. This morning, I'll review, our 2021 accomplishments and then focus my remarks on our 2022 plans and outlook.
Speaker Change: 2021 was a remarkable year for Xeris with many significant achievements. Most notable was the acquisition and integration of StrongBridge Biopharma that enabled Xeris to expand our portfolio of commercialized products and to take an important step forward in creating the critical mass necessary to become a fully capable and profitable pharmaceutical company.
2021 was a remarkable year for <unk> with many significant achievements. Most notable was the acquisition and integration of strong bridge Biopharma that enabled <unk> to expand our portfolio of commercialized products and to take an important step forward in creating the critical mass necessary to become a fully capable and profitable pharmaceutical.
Company.
Speaker Change: Other key highlights include impressive total product sales of $79 million on a pro forma basis for Jivoke and Coveas, which is a 56% increase over 2020.
Other key highlights include impressive total product sales of $79 million on a pro forma basis for <unk>, which is a 56% increase over 2020.
Speaker Change: GMO prescriptions in the fourth quarter and full year 2021 grew by 85% and 144% respectively compared to last year.
GMO prescriptions in the fourth quarter and full year, 2021 grew by 85% and 144% respectively compared to last year.
Speaker Change: The number of primary paralysis patients benefiting from conveyance continued to grow throughout 2021 and net sales increased year over year, reaching the top end of our 38 to $40 million guidance.
The number of primary paralysis patients benefiting from <unk> continued to grow throughout 2021, and net sales increased year over year, reaching the top end of our $38 million to $40 million guidance.
We also formed two important partnerships that could create a significant value in the future with <unk> pharma to commercialize <unk>, which is our international trade name for <unk>.
Speaker Change: We also formed two important partnerships that could create a significant value in the future with Tetris Pharma to commercialize Oguro, which is our international trade name for Givoke, in the UK and Europe .
In the UK and Europe .
Speaker Change: and with Merck to access our Xeroject technology for an as yet undisclosed monoclonal antibody.
And with Merck to access our <unk> technology for <unk>.
Yet undisclosed monoclonal antibody.
Speaker Change: We also received multiple FDA approvals in 2021.
We also received multiple FDA approvals in 2021.
Speaker Change: First, for the room temperature shelf-life extension for our one milligram presentation of the GEVO KypoPen and pre-filled syringe from 24 months to 30 months of room temperature stability.
First for the room temperature shelf life extension for our one milligram presentation of the <unk> and pre filled syringe from 24 months to 30 months of room temperature stability.
Speaker Change: and for our G-Vote kit, which is a single-use vial and syringe presentation, giving patients another ready-to-use G-Vote option. The kit will be available for sale next week.
And for our <unk> kit, which is a single use vial and syringe presentation, giving patients another reviews G. Both options.
It will be available for sale next week.
Speaker Change: and very importantly for Recorlif, an important new treatment option for patients suffering from Cushing syndrome.
And very importantly for <unk>, an important new treatment option for patients suffering from Cushings syndrome.
Speaker Change: We also made advancements in our development pipeline, having submitted INDs in support of various programs, most recently for exercise-induced hypoglycemia.
We also made advancements in our development pipeline, having submitted <unk> in support of various programs. Most recently for exercise induced hypoglycemia.
Speaker Change: and we ended the year in a very strong financial position with $102 million on the balance sheet and then added to that strength with an additional $30 million private placement at the start of 2022.
And we ended the year with very strong financial position with $102 million on the balance sheet.
And then added to that strength with an additional $30 million private placement at the start of 2022.
Speaker Change: When coupled with the debt restructuring with Haytham that we announced this morning, Xeris' financial position is as strong as it has ever been since the company's inception.
When coupled with the debt restructuring with hasten that we announced this morning <unk> financial position is as strong as it has ever been since the company's inception more specifically.
Speaker Change: More specifically, we believe that we will end 2022 with $90 to $110 million, assuming achievement of our product revenue guidance, and we will reach cash flow breakeven by year-end 2023.
We believe that we will end 2022 with $90 million to $110 million, assuming achievement of our product revenue guidance and we will reach cash flow breakeven by year end 2023.
Speaker Change: Steve will go into more detail on our 2021 financial performance and 2022 financial outlook.
Steve will go into more detail on our 2021 financial performance and 2022 financial outlook.
Speaker Change: Now I'd like to go into a little bit more detail on our three commercial products, starting with Jeebo.
Now I'd like to go into a little bit more detail on our three commercial products starting with <unk>.
Speaker Change: For GVOC, our message to physicians and other health care providers is clear and simple. Everyone on insulin is at increased risk of experiencing a severe low blood sugar event, and therefore should have a ready-to-use glucagon product available for rescue.
For <unk>, our message to physicians and other health care providers is clear and simple everyone. On insulin is at increased risk of experiencing severe low blood sugar event, and therefore should have a ready to use glucagon product available for rescue.
That message continues to resonate strongly in the medical community in.
Speaker Change: That message continues to resonate strongly in the medical community.
Speaker Change: In fact, the ready-to-use products have grown to 60-plus percent of the total gun market in just over two years.
In fact, the ready to use products have grown to 60 plus percent of the total market and just over two years.
Speaker Change: Every week, new prescribers come on board. Every week, prescribers add additional insulin patients in their practices that should have ready-to-use GVOC hypopen at hand, all of which are contributing to GVOC's impressive and accelerating performance.
Every week, new prescribers come onboard every week prescribers add additional insulin patients to their practices that should have ready views <unk> type of patent at hand, all of which are contributing to G box impressive and accelerating performance.
Speaker Change: In the fourth quarter, Chivo's prescriptions grew 7% from the third quarter. This is particularly strong performance considering the glucagon market declined 8% over the same period.
In the fourth quarter G. Both prescriptions grew 7% from the third quarter. This is particularly strong performance considering the glucagon market declined 8% over the same period.
Speaker Change: You will recall from our previous reviews that third quarter is the quarter in which glucagon prescriptions normally surge as a part of a back-to-school phenomenon. And so fourth quarter has historically declined in comparison.
You will recall from our previous reviews that third quarter is the quarter in which group gone prescriptions normally surge as a part of a back to school phenomenon and so fourth quarter has historically declines in comparison with.
Speaker Change: We continue to outpace the overall group gun market due to strong demand for our product with G boats retail market share currently standing at approximately 20%
We continue to outpace the overall who've gone market due to strong demand for our product with <unk> retail market share currently standing at approximately 20%.
Speaker Change: that the GVO grew so strongly into such a headwind reinforces our enthusiasm for continuing strong performance in the future.
The <unk> grew so strongly into such a headwind reinforces our enthusiasm for continuing strong performance in the future.
Moving on to <unk>. Today is also enjoined enjoyed a strong 2021, achieving pro forma product sales at the top end of our $38 million to $40 million guidance.
Speaker Change: Moving on to Kiveyas, Kiveyas also enjoyed a strong 2021, achieving pro forma product sales at the top end of our $38 to $40 million guidance.
Speaker Change: As we have discussed previously, periodic peripheral paralysis 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 healthcare community.
As we have discussed previously periodic peripheral paralysis patients are extremely hard to identify so this strong performance is a testament to the collective expertise of the team and our close working relationship with the health care community.
Speaker Change: The smooth transition of the Cabeza's commercial operations to Xeris also helped ensure continued strong performance.
The smooth transition of the <unk> commercial operations deserves also help ensure continued strong performance.
And now for a record.
Speaker Change: We received an early FDA approval for Rekorlev on December 30th, 2021, because of the incredible amount of work during the integration by the teams and at the end of the year. Within a few weeks after approval, we were able to hold our virtual launch meeting and sale with the sales team and ship product to our specialty pharmacy partner.
We received an early FDA approval for <unk> on December 30, <unk> 2021.
Cause of the incredible amount of work during the integration by the teams at the end of the year within a few weeks. After approval, we were able to hold our virtual launch meeting and with the sales team and ship product to our specialty pharmacy partner.
As we've discussed the key value driver of the strong bridge acquisition was the market opportunity for <unk> and the fit with our existing <unk> commercial infrastructure.
Speaker Change: As we've discussed, the key value driver of the Strongbridge acquisition was the market opportunity for Recorlov and the fit with our existing GEVO commercial infrastructure.
Speaker Change: We remain very excited about the prospects of Recorlo. We estimate there are approximately 8,000 patients requiring pharmacologic treatment, of whom 40% are poorly controlled.
We remain very excited about the prospects of the Colo. We estimate there are approximately 8000 patients requiring pharmacy pharmacologic treatment of whom 40% are poorly controlled.
Speaker Change: The estimated total addressable market for this therapy is approximately $2 billion in the US.
The estimated total addressable market for this therapy is approximately $2 billion in the U S.
Speaker Change: By leveraging Xeris' commercial infrastructure targeted at endocrinology and the legacy Strongbridge organization's experience in supporting people with rare diseases, we believe that we're in a great position to help Cushing Syndrome patients who are inadequately controlled achieve a more normal lifestyle.
Leveraging <unk> commercial infrastructure targeted at endocrinology and the legacy strong strong bridge organizations experience in supporting people with rare diseases.
We believe that we're in a great position to help Cushing syndrome patients who are inadequately controlled achieve a more normal lifestyle.
Speaker Change: And while it's only been a few weeks since launch, we've already placed several patients on Recorlo and have been able to support them through our Xeris Care Connection.
And while it's only been a few weeks since launch we have already placed several patients on <unk> and have been able to support them through our <unk> care connection.
Speaker Change: XerisCare Connection provides support services throughout the entire treatment journey to patients and healthcare professionals with direct access to pharmacists, reimbursement specialists, and access management.
<unk> care connection provides support services throughout the entire treatment journey to patients and health care professionals with direct access to pharmacists reimbursement specialists and access managers.
Speaker Change: Just a couple of updates on some of our pipeline programs. As we previously announced, we initiated and continue to dose participants in a single, ascending phase one study of our novel formulation of levothyroxine to evaluate the potential for a once-weekly subcutaneous injection.
Just a couple of updates on some of our pipeline programs as we previously announced we initiated and continue to dose participants in a single ascending phase one study of our novel formulation of Levothyroxine to evaluate the potential for a once weekly subcutaneous injection.
Speaker Change: We expect complete results from a range of dosage and dosage proportionality from the phase one study in the third quarter of 2022.
We expect complete results from a range of doses and dosage proportionality from the phase one study in the third quarter of 2022.
Speaker Change: We recently submitted an IND for exercise-induced hypoglycemia, and received FDA clearance in March. We expect to start additional Phase II work later this year.
We recently submitted an IND for exercise induced hypoglycemia and received FDA clearance in March we expect to start additional phase II work later this year.
And moving onto our outlook for 2022.
Speaker Change: On our third quarter call, we committed to providing total company product revenue guidance for 2022. Our focus is obviously on driving the entire product portfolio. Therefore, I want to reemphasize that we will be only providing outlook for the total company product revenue.
On our third quarter call, we committed to providing total company product revenue guidance for 2022, our focus is obviously on driving the entire product portfolio. Therefore, I want to reemphasize that we will be prove only providing outlook for the total company product revenue.
We expect product sales of all three branded products to total between $105 and $120 million in 2022.
Speaker Change: We expect product sales of all three branded products to total between 105 and 120 million in 2022.
Speaker Change: Assuming company performance is consistent with our 2022 guidance and our internal 2023 outlook, we expect to end 2022 with $90 to $110 million in cash, and we expect to achieve cash flow breakeven by year-end 2023.
Assuming company performance is consistent with our 2022 guidance and our internal internal 2023 outlook. We expect to end 2022 with $90 million to $110 million in cash and we expect to achieve cash flow breakeven by year end 2023.
Speaker Change: We also believe that given 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, we would not anticipate needing to raise additional capital in order to fund our ongoing operation.
We also believe that given our exceptionally strong cash position as a result of cash on hand revenue generated from our three commercial products. The addition of cash from our recent private placement and with our debt refinance we would not anticipate needing to raise additional capital in order to fund our ongoing operations.
Speaker Change: A return to the capital markets would be most likely for M&A purposes only.
Turning to the capital markets would be most likely for M&A purposes only.
Our company has arrived at a very important strategic inflection point in our history and we look ahead to 2022 and beyond.
Speaker Change: Our company has arrived at a very important strategic inflection point in our history, and we look ahead to 2022 and beyond.
Speaker Change: I couldn't be more pleased with what the future holds for our stakeholders, the patient communities we serve.
I couldnt be more pleased with the with what the future holds for our stakeholders the patient communities we serve.
Speaker Change: our employees, our shareholders, and our healthcare professional partners.
Our employees, our shareholders and our health care professional partners.
Speaker Change: 2022 is a year of execution. With that, I'll turn it over to Steve to review the details of our financial performance.
2022 is a year of execution with that I'll turn it over to Steve to review the details of our financial performance. 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, and our 10-K that will be.
Steve Piper: Thanks, Paul. Good morning, everyone. I will focus my remarks on a few of the key financial results.
Steve Piper: The details of which are in the press release issued this morning and are 10-K that will be filed later today.
Filed later today.
Steve Piper: Because we closed the StrongBridge acquisition in early October , the financial results I'm covering today, including fourth quarter and full year 2021, only include the fourth quarter impact from the StrongBridge acquisition. However, I will also be commenting on the full year pro forma net product revenue results.
Because we closed the strong bridge acquisition in early October the financial results I am covering today, including fourth quarter and full year 2021.
Only include the fourth quarter impact from the strong bridge acquisition. However, I will also be commenting on the full year pro forma net product revenue results.
Steve Piper: As you heard Paul say, strong demand continued for GVOC and KVAS in 2021. On a pro forma basis, total net product revenue was $79 million for the full year, representing a 56% increase over pro forma 2020 revenues.
As you heard Paul say strong demand continued for <unk> and <unk> in 2021 on a pro forma basis total net product revenue was $79 million for the full year, representing a 56% increase over pro forma 2020 revenues, finishing at the high end of the guidance.
Steve Piper: finishing at the high end of the guidance we provided back in November . On a GAAP-reported basis, fourth quarter total net product revenue was $21.4 million and for the full year was $49.3 million, reflecting only one quarter of Kivea's contribution.
We provided back in November .
On a GAAP reported basis fourth quarter total net product revenue was $21 4 million and for the full year was $49 3 million, reflecting only one quarter of <unk> contribution.
Steve Piper: While we are not reporting net revenue by product, I will say that Cabeas did achieve the high end of our previous guidance range of $38 to $40 million for the full year 2021.
While we are not reporting net revenue by product I will say that convey it did achieve the high end of our previous guidance range of $38 million to $40 million for the full year 2021.
Steve Piper: GVOG continued its strong momentum in the fourth quarter, driving quarter-over-quarter prescription growth of 7 percent and topping 29,000 prescriptions, growing more than 85 percent from Q4 of 2020. For the full year 2021, GVOG generated over 94,000 prescriptions, representing a 144 percent increase over full year 2020.
<unk> continued its strong momentum in the fourth quarter driving quarter over quarter prescription growth of 7% and topping 29000 prescriptions growing more than 85% from Q4 of 2020.
For the full year 2021, chievo generated over 94000 prescriptions, representing a 144% increase over full year 2020.
Steve Piper: As we move down the P&L, cost of goods sold was $4.9 million for the three months ended December 31, 2021, an increase of approximately $1.5 million compared to the same period in 2020.
As we move down the P&L cost of goods sold was $4 9 million for the three months ended December 31, 2021, an increase of approximately $1 5 million compared to the same period in 2020 cost of goods sold was $13 3 million for the full year.
Steve Piper: cost of goods sold was $13.3 million for the full year ended December 31, 2021, an increase of $4 million compared to the full year 2020, which included primarily product cost for increased product sales partially offset by lower excess and obsolete expenses.
At December 31, 2021.
An increase of $4 million compared to the full year 2020, which included primarily product cost for increased product sales, partially offset by lower excess and obsolete expenses.
Steve Piper: Turning our attention to expenses, research and development expenses increased by approximately $5 million in the fourth quarter 2021 to $10.1 million compared to the same period in 2020.
Turning our attention to expenses research and development expenses increased by approximately $5 million.
In the fourth quarter, 2021% to $10 1 million compared to the same period in 2020.
Steve Piper: On a full-year basis, research and development expenses increased by approximately $4.2 million in 2021 to $25.2 million compared to the full year 2020. These increases were primarily driven by higher pharmaceutical process development and clinical costs across multiple programs.
On a full year basis research and development expenses increased by approximately $4 2 million in 2021% to $25 2 million compared to the full year 2020.
These increases were primarily driven by higher pharmaceutical process development and clinical costs across multiple programs.
Steve Piper: Selling general and administrative expenses increased by approximately $36 million in the fourth quarter 2021 to approximately $54 million compared to the same period in 2020. On a full-year basis, SG&A expenses increased by approximately $52 million in 2021 to approximately $126 million compared to the full year 2020.
Selling general and administrative expenses increased by approximately $36 million in the fourth quarter 2021 to approximately $54 million compared to the same period in 2020.
On a full year basis, SG&A expenses increased by approximately $52 million in 2021 to approximately $126 million compared to the full year 2020.
Steve Piper: Let me provide some important context to these increases relative to 2020.
Let me provide some important context to these increases relative to 2020.
Steve Piper: As I mentioned on our third quarter earnings call, given that the Strongbridge acquisition closed in early October , I had communicated that we would incur a majority of the one-time costs associated with the transaction in the fourth quarter.
As I mentioned on our third quarter earnings call given that the strong bridge acquisition closed in early October I had communicated that we would incur a majority of the onetime costs associated with the transaction in the fourth quarter.
Steve Piper: I also mentioned that with the acquisition of StrongBridge, we would absorb the Kibeas commercial infrastructure, which prior to the fourth quarter of 2021 did not exist in Xeris's financial results. This is important context in terms of the increases to SG&A relative to both the fourth quarter and full year 2020 results.
I also mentioned that with the acquisition of strong bridge, we would absorb the <unk> commercial infrastructure, which prior to the fourth quarter of 2021 did not exist in <unk> financial results. This is important context in terms of the increases to SG&A relative to both the fourth quarter and full year.
<unk> 2020 results.
Steve Piper: With this context in mind, looking at the fourth quarter and full year 2021 increases, approximately $18 million and $24 million of the respective increases are related to the acquisition of strongbrokes.
With this context in mind looking at the fourth quarter and full year 2021 increases.
Approximately $18 million and $24 million of the respective increases are related to the acquisition of strong bridge.
Steve Piper: including transaction costs, restructuring, related employee costs, and insurance costs.
<unk> transaction costs restructuring related employee costs and insurance costs. These strong bridge acquisition related expenses and SG&A will not materially weaker.
Steve Piper: These Strongbridge acquisition-related expenses in SG&A will not materially recur in 2022. Furthermore, these results do not include any impact from material cost-saving synergies, the bulk of which we expect to realize by year-end 2022.
In 2022. Furthermore, these results do not include any impact from material cost savings synergies the bulk of which we expect to realize by year end 2022.
Steve Piper: Additional drivers of the SG&A increase in the fourth quarter and full year 2021 include the previously communicated expansion of our GVOX sales force in 2021, the inclusion of the QVEA's commercial team and related expenses in Q4 of 21, and other commercial-related expenses, including preparation for a RecorLev launch in Q1 2022.
Additional drivers of the SG&A increase in the fourth quarter and full year 2021 include the previously communicated expansion of our <unk> sales force in 2021.
The inclusion of the <unk> commercial team and related expenses in Q4 of 'twenty, one and other commercial related expenses, including preparation for over Korolev launch in Q1 2022.
Steve Piper: These expenses accounted for approximately $16 million and $17 million of the fourth quarter and full year 2021 increase.
These expenses accounted for approximately $16 million $17 million of the fourth quarter and full year 2021 increase.
Steve Piper: To be clear, we believe that we are on track to realize $50 million in deal-related synergies approximately equally split between cost reductions and cost avoidance by the end of 2022.
To be clear.
We believe that we are on track to realize $50 million in deal related synergies approximately equally split between cost reductions and cost avoidance by the end of 2022.
Steve Piper: Additionally, our operating expenses going forward will include, in the future, costs for the launch of RecorLav, supporting the continued growth of both GVOC and CVEAS and R&D, and operating and other administrative costs associated with running a public company.
Additionally, our operating expenses going forward will include in the future costs for the launch of our core love supporting the continued growth of both <unk> and R&D and operating and other administrative costs associated with running a public company.
Steve Piper: Turning our attention to cash, as of December 31st, 2021, Xeris had total cash, cash equivalents, and short-term investments of $102.4 million, compared to $133.8 million at December 31, 2020.
Turning our attention to cash as of December 31, 2021, <unk> had total cash cash equivalents and short term investments of $102 4 million compared to $133 8 million at December 31, 2020, we will continue to pay strong bridge.
Steve Piper: We will continue to pay Strongbridge acquisition-related costs in 2022, including severance and other accrued liabilities at year-end 2021.
Acquisition related costs in 2022, including severance and other accrued liabilities at year end 2021.
Turning our attention to that.
Steve Piper: As we announced earlier this morning, 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.
As we announced earlier this morning, we entered into a senior secured term loan agreement with funds managed by hasten to provide us with up to a total of $150 million of capital.
Steve Piper: Under the terms of the debt facility, we drew $100 million on the closing date and we repaid our previous debt facility of $43.5 million with Oxford Finance and Silicon Valley Bank.
Under the terms of the debt facility, we drew $100 million on the closing date, and we repaid our previous debt facility of $43 5 million with Oxford Finance and Silicon Valley Bank.
Steve Piper: The net proceeds will provide additional working capital to fund our business plan.
The net proceeds will provide additional working capital to fund our business plan and.
Steve Piper: An additional $50 million is available to Zaris at our election during the next 12 months.
An additional $50 million is available to <unk> at our election. During the next 12 months based upon our current operating plan. We expect we will draw the remaining $50 million by the end of this year.
Steve Piper: Based upon our current operating plan, we expect we will draw the remaining $50 million by the end of this year.
Steve Piper: We are very pleased to be partnering with Hafen. This debt facility increases our financial strength and provides us with substantial resources by securing access to non-dilutive capital on attractive terms without over-encumbering our balance sheet.
We are very pleased to be partnering with hasten this debt facility increases our financial strength and provides us with substantial resources by securing access to non dilutive capital on attractive terms without over encumbering our balance sheet.
Steve Piper: Together with the recent equity financing, which closed in January , Xeris has now added approximately $80 million of cash to the greater than $102 million of cash, cash equivalents, and short-term investments already on our balance sheet at year-end 2021.
Together with the recent equity financing, which closed in January <unk> has now added approximately $80 million of cash to the greater than $102 million of cash cash equivalents and short term investments.
Already on our balance sheet at year end 2021.
Steve Piper: 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.
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 breakeven by year end 2023, and thereafter produce increasing operating cash flow.
As we look ahead, 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.
Steve Piper: As we look ahead, 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 StrongBridge acquisition related costs.
Steve Piper: With the revenue growth from our three marketed products combined with our current cash position, the cash received from the recent equity financing and the debt restructuring with Haven, we believe that we will finish 2022 with approximately 90 to 110 million and further can achieve cash flow break even by year end 2023.
With the revenue growth from our three marketed products combined with our current cash position. The cash received from the recent equity financing and the debt restructuring with tape and we believe that we will finish 2022 with approximately $90 million to $110 million and further can achieve cash flow breakeven by year end 2023.
Hi.
Steve Piper: To summarize, Jivoke and Kimbez had a great quarter and year in terms of net product sales.
To summarize <unk> had a great quarter and year in terms of net product sales.
Steve Piper: We have integrated StrongBridge quickly into Xeris and will achieve $50 million in synergies by the end of 2022. And we are in a solid position from a cash perspective to drive growth of Chivo, Kibais, and Recorla and fund our R&D pipeline.
We have integrated strawbridge quickly in those areas and will achieve $50 million in synergies by the end of 2022.
And we are in a solid position from a cash perspective to drive growth achieve O <unk> and fund our R&D pipeline let.
Steve Piper: Let me turn the call back to Paul. Thanks, Steve. As you just heard, we're off to a great start in 2022 as a result of the great work done by the entire team in 2021. We believe that with the continued growth of our three commercial products, Jibo, Kvass, and now with Orla, we can achieve full year 2022 net sales in the range of 105 to 120 million. In 2022, we also expect Tectus to launch Oguro in several additional European countries.
Let me turn the call back to <unk>.
Thanks, Steve as you just heard we're off to a great start in 2022 as a result of the great work done by the entire team in 2021, we believe that with the continued growth of our three commercial products <unk> and now record level. We can see full year 2022, net sales in the range of $105 million to $120 million.
In 2022, we also expect Texas to launch <unk> in several European additional European countries.
Paul Edick: the availability of the GEBO kit next week, data from our Phase 1 study of levothyroxine in the third quarter, and initiation of an exercise-induced hypoglycemia Phase 2 program later in the year.
The availability of the <unk> kit next week.
Data from our phase one study of legal thyroxine in the third quarter and initiation of an exercise induced hypoglycemia phase III program.
Later in the year.
Paul Edick: And because of cash on hand, cash generating products, and the capital from HAFEN, we expect to end 2022 with a very healthy cash position, as Steve mentioned. And as we've said several times, cash flow will break even by year-end 2023.
And because of cash on hand cash generating products and the capital from <unk>. We expect to end 2022, with a very healthy cash position as Steve mentioned and as we've said several times cash flow breakeven by year end 2023.
Speaker Change: Operator, I'll turn it over to you to open the lines for questions.
Operator, I'll turn it over to you to open the lines for <unk>.
Two questions.
Thank you as a reminder, if you would like to ask a question. Please press star one on your telephone keypad now if you wish to withdraw your question. Please press star two please ensure that your line is not mute locally when asking your question.
Operator: Thank you. As a reminder, if you would like to ask a question, please press star 1 on your telephone keypad now. If you wish to withdraw your question, please press star 2. Please ensure that your line is not muted locally when asking your question.
Speaker Change: The first question today comes from Roana Ruiz from SVB Leerink, please go ahead.
Our first question today comes from <unk> from SVP Leerink. Please go ahead.
Hi, Good morning, everyone. So two questions from me first is wanted to ask about your financial guidance for 2020.
Roana Ruiz: Hi, good morning everyone. So two questions for me. First is wanted to ask about your financial guidance for 2020.
Confidence in the $105 million to $120 million net product revenue range and.
Roana Ruiz: confidence in the 105 to 120 million net product revenue range. And I was also wanted to ask about Rekorlev. So could you talk a little bit about the first patients that have been prescribed Rekorlev? You know, have they cycled through products previously? Are they more switch patients from other Cushing's drugs? Or just to help us think about like what they look like and as the early adopters of Rekorlev.
I was also wanted to ask about <unk>. So could you talk a little bit about the first patients that have been prescribed <unk> Hyundai cycled through products previously are they more switch patients from other Christians.
Just to help us think about like what they look like.
Early adopters of equivalents.
Speaker Change: Hey, Rana. Good morning. Thank you. I'll take the second one first. We don't, we don't yet. We've got a few patients so far. We don't yet have a handle on where they're coming from. We don't have that level of specific information on a per patient basis. As we get more patients, the specialty pharmacy will begin to aggregate
Hey, Ron Good morning, Thank you.
I'll take the second one first we don't we.
We don't yet we've got a few patients so far we don't yet have a handle on where they are coming from we don't have that level of specific information on a pay per patient basis.
As we get more patients.
Specialty pharmacy will begin to aggregate.
Speaker Change: in general, you know, where the patients are coming from.
In general.
Where the patients are coming from.
From a 100 plus basis.
Speaker Change: cycled through. We'll know more as we get more.
Cycled through.
We'll know more as we get more.
And then your first question.
Speaker Change: And then your first question, in terms of what's driving our confidence, I think in our prepared remarks, we had a great fourth quarter when you compare it to what the market did and normally does. So, that's incredibly encouraging. And if you look at script data so far at the beginning of the year, we're off to a really good start. Tobias is holding strong, and we're a few weeks into a core level, but we're feeling very positive.
In terms of what's driving our confidence.
<unk>.
I think in our in our prepared remarks, we had a great fourth quarter. When you when you compare it to what the market did it normally does.
So that's incredibly encouraging and if you look at script data so far at the beginning of the year, we're off to a really good start.
So the <unk> is holding strong and.
A few weeks into record load, but we're feeling very positive.
Okay makes sense, thanks, a lot.
Speaker Change: Our next question comes from Vamil Devan from Mizuho Securities. Please go ahead.
Our next question comes from panel demand from Mizuho Securities. Please go ahead.
Yeah, great. Thanks for taking my question so maybe.
Vamil Devan: Yeah, great. Thanks for taking my question. So maybe, uh, one else on our core 11 and a couple more on that guidance commentary you made. Thanks for all the input you provided. So one just on record with it. Can you just talk a little bit about the pager, uh, environment there in terms of first few patients and what you're expecting going forward through? Um
Also in the quarter.
A couple more on it.
Commentary you made.
For all that you provided so one just on your call, but can you just talk a little bit about the patriarch.
Environment there in terms of the first patient and what's your expectation going forward.
Vamil Devan: you know, any requirements that people having had gone through other therapies or what would just kind of help payers are adopting this product. And then on the guidance side, I had a couple of questions just to make sure I understand.
Any requirements people, having had gone on to other therapy.
Just kind of how payers are adopting this product.
And then on the guidance I had a couple of questions just to make sure I understand.
Vamil Devan: from what you said to this, the cash of $90 to $110 million at your end.
Or would you say the.
The cash of $90 million to $110 million at year end.
Vamil Devan: that already includes the $50 million that you're expecting to draw down from HAPE. And it sounds like they just want to make sure I'm clear on that. And then I'm trying to triangulate from that to your comments of it being cash flow breakeven.
That already includes the 50 million that youre expecting to draw down okay.
And it sounds like that you want to make sure I'm right.
Clear on that and then I'm trying to triangulate from that how is it being cash flow breakeven.
Vamil Devan: by the end of next year. Aside from the strong liquid related costs you talked about, I don't think you're going to have some of that at the beginning of this year. Would you expect overall expenses to stay somewhat similar between 22 and 23? I'm just trying to get a sense of what your burn rate would be on a more steady basis and how to get to the point where your cash flow breaks.
And then next year.
Profit related costs, you talked about that it sounds like youre going to come on that.
This year, what do you expect overall expenses stay somewhat similar between 22 and.
I'm, just trying to get a sense of.
What's your burn rate would be at a more steady basis.
And how to get to a point, where your cash flow breakeven.
Thanks.
Speaker Change: Okay. Hey, Vam, thank you very much. Appreciate the question.
Okay, well. Thank you very much I appreciate the question.
On <unk>.
Speaker Change: We only have a few patients so far, so and the.
We only have a few patients so far so and.
All of these patients are most all of them require prior authorization, we're going through that process.
Speaker Change: All of these patients, or most all of them, require prior authorization. We're going through that process. The brand and products in this category are getting reimbursed, and they're getting reimbursed at the price levels that we've established. So we're not worried about it. It is a priority.
The branded products in this category are getting reimbursed and they are getting reimbursed at.
The price levels that we've established so we're not worried about it is a process.
Speaker Change: And with every patient, we go through the process. They're referred to therapy. They're referred to the specialty pharmacy. The specialty pharmacy works with them to get all the history and everything. They're referred to our care connections so that we can support the patient, help them go through the reimbursement process, get them pre-approved.
And with every patient we go through the process.
Referred to therapy.
Are referred to the specialty pharmacy specialty pharmacy works with them to get all the history and everything they're referred to our care connection. So that we can support the patient help them go through the reimbursement process get them get them preapproved.
Speaker Change: And we're going through that process. Each patient is individual and it takes a little bit of time. It's not like a prescription shows up at Walgreens and they adjudicate it in 30 seconds over their computer.
And we're going through that process, each patient as individual and that it takes a little bit of time, it's not like a prescription shows up at Walgreens and they adjudicated in 30 seconds over their computer.
Speaker Change: Um, but we we don't foresee any roadblocks there. We think we're going to be fine. Other products are out there and getting reimbursed. So, uh, that should not be an issue. We won't have 100%. You never do. Um, but we think we think there is a pathway.
But we don't foresee any roadblocks that we think we're going to be find other products that are out there and getting reimbursed so that should not be an issue. We won't have 100% you never do.
But we think we think there is a pathway.
Speaker Change: In terms of the 90 to 100 million year-end cash guidance, yes, it does include drawdown of that other 50 late in the year. And then in terms of cash flow breakeven expenses, 22 to 23, we expect to have a pretty good steady state once we get past the first quarter and some of the one-timers that are in the first quarter. The rest of 22 and 23 should be pretty consistent.
In terms of the $90 million to $100 million year end cash.
Cash guidance, yes. It does include dry download that other 50 late in the year and then in terms of cash flow breakeven expenses 'twenty two to 'twenty three we expect to have a pretty good steady state once we get past the first quarter and some of the.
One timers that are in the first quarter.
Rest of 'twenty, two and 'twenty three it should be pretty consistent.
Okay. Thank you very much.
Hi.
Speaker Change: Our next question comes from David Selim from Piper Sandler. Please go ahead.
Our next question comes from David <unk> from Piper Sandler. Please go ahead.
David Selim: Hey, thanks. So just a few. First, Paul, you made a comment about potentially.
Hey, Thanks, So just a few.
First Paul you made a comment about.
Potentially.
Paul Edick: accessing equity capital to the extent that you do additional M&A. So I wanted to get some more clarity from you as to the kind of assets.
Accurate.
Capital to the extent that you do.
Any additional M&A, so I wanted to get some more clarity for me.
The kind of assets.
Paul Edick: you'd be interested in, and just in general, how much of a priority M&A is going forward? So that's the first question. The second question is on GVOTE. In terms of, you know...
The interested in.
And just in general how much.
Priority M&A is.
Going forward so.
First question.
The second question.
On Tivo.
Sure.
No.
Paul Edick: Moving on from the pandemic or hopefully moving on from the pandemic. What's your sense regarding the extent to.
Moving on from the pandemic.
Hopefully moving on from the pandemic, what's your sense.
Rich.
Paul Edick: you know, a ready piece product will get more on the radar of endocrinologists, the extent to which we could see, uh, overall, um, expansion of adoption. You know, how are you thinking about that? And as a related question, you know, what portion of your sales calls are in person?
<unk> product will get more on the radar.
<unk> expense.
The extent to which you could see.
Yes.
Overall.
Expansion of adoption.
Thinking about that and is it related question.
What portion of your sales calls or in person.
Paul Edick: And then the last question is on the core laws, just as a follow-up on the payer question.
Yes.
And then the last question is on corn.
Corn laws.
Just as a follow up on the prior question.
Paul Edick: Um, is it your expectation over time that for correlative patients will have to have exposure to ketoconazole in order to access the product? Um, or do you think you might even see wider access? Thanks.
Is it your expectation over time that require less patients we will have to have that exposure.
Upon arrival in order to access the product.
Or do you think you might even see water access.
Speaker Change: Okay, David, thank you very much for joining us this morning and let me take them in the same order that you gave them to me. In terms of access to the capital markets, the most important point in my statement is that we believe we can get to cashflow break-even with our organic business growth and the cash that we have on hand and the cash that we're going to generate. If we do access the capital markets, it would more than likely be for continued M&A activity. We are
Okay. David Thank you very much for joining us this morning, and let me take them in the same order that you gave them to me in terms of access to the capital markets.
The most important point in my statement is that we believe we can get to cash flow breakeven with our organic business growth and the cash that we have on hand, and the cash that we're going to generate.
If we do access the capital markets it would more than likely be for continued M&A activity.
We are.
Speaker Change: focused on growing our organic business without question. We're focused on getting to profitability. And that requires we get to a level of critical mass. And M&A and continued product and potential company acquisition plays a role in that. And the kind of assets we would look for and look at the strong bridge acquisition. It's it's.
Focused on growing our organic business without question.
We're focused on getting to profitability and that requires we get to a level of critical mass.
And M&A and continued product and potential company acquisition plays a role in that.
And the kind of assets, we would look forward and you look at the strong bridge acquisition.
It's.
Speaker Change: exquisite in its overlap with our current business or our previous business and it it allows us to advance our move to critical mass and profitability significantly. So you know if there's another strong ridge out there then that's something we would consider. But there's you know that's just a part of our plan. In terms of GEVO
Exquisite and its overlap with our current business or our previous business and.
It allows us to advance our move to critical mass and profitability significantly so.
If there is another strong result, there then that's something we would consider.
But there is that's just a part of our plan.
In terms of <unk>.
The ready to use market expansion.
Speaker Change: the ready-to-use market expansion, we're already starting to see late in the fourth quarter and beginning of the third quarter getting back to double-digit growth.
We're already starting to see late in the fourth quarter and beginning of the third quarter getting back to double digit growth. So we're very confident it's going to I mean at the end of the day.
Speaker Change: So we're very confident it's going to grow. I mean, at the end of the day, physicians don't disagree that if patients are on insulin, they should have a ready-to-use glucagon product handy, available. It's just generating more of that behavior because you've got decades of lack of behavior.
Physicians don't disagree that if patients are on insulin they should have a ready to use glucagon products handy available.
Just generating more of that behavior, because <unk> got decades of lack of behavior. So every day more and more physicians get onboard and begin to give more of their insulin patients one of these ready to use products.
Speaker Change: So every day, more and more physicians get on board and begin to give more of their insulin patients.
Speaker Change: one of these ready-to-use products, and the degree to which they're giving GVOC is growing every single day.
And the degree to which Theyre, giving G book is growing every single day.
Speaker Change: Face-to-face interactions with physicians are nearing a hundred percent. I mean, we're out there. All the reps are in the field. We still have an inside group, which will remain totally virtual. But we're getting access. It's looking pretty good. And fingers crossed, hopefully, we're actually coming out of this.
Face to face interactions with physicians are nearing 100%.
Out there all the reps are in the field.
We still have an inside group, which will remain totally virtual but we're getting access.
It's looking pretty good and fingers crossed hopefully we're actually coming out of.
Speaker Change: It's a whole pandemic thing. And then as far as keto step through, we do not expect that to be the case. We expect to get patients from all.
The whole pandemic thing.
And then as far as keto step through we do not expect that to be the case, we expect to get patients from from all different products. Because there is quite a churn in this market and our focus is on those patients 8000, pharmacological treatment 3200 of which are uncontrolled not achieve.
Speaker Change: products because there's quite a churn in this market and our focus is on those patients.
Speaker Change: 8,000 on pharmacological treatment, 3,200 of which are...
Speaker Change: uncontrolled, not achieving normalization of cortisol. Control equals normalization of cortisol. That's what we're focused on. There's plenty of patients out there.
<unk> normalization of cortisol and.
Control equals normalization of cortisol and that's what we're focused on with plenty of patients out there.
Speaker Change: Thanks, David.
Thanks, Paul.
Thanks, David.
Sure.
So we have nice other questions waiting on Nicole I will hand, it back to cole for closing remarks.
Speaker Change: So we have no further questions waiting on the call. I will hand it back to Paul for closing remarks.
Paul Edick: Thank you. Thank you, guys, for your questions. Thanks, everybody, for listening. Congratulations to the team on a great year and a great fourth quarter, and we're looking forward to another successful year in 2022. Thank you very much.
Thank you. Thank you guys for your questions. Thanks, everybody for listening congratulations to the team on a great year and a great fourth quarter and we're looking forward to another successful year in 2022. Thank you very much.
Speaker Change: This concludes today's conference call. Thank you very much for joining. You may now disconnect your line.
This concludes today's conference call. Thank you very much for joining you may now disconnect your lines.
Speaker Change: the old old the
Okay.
Okay.
Thanks.
Yes.