Q1 2022 Ardelyx Inc Earnings Call
[music].
Good afternoon, and welcome to our direct first quarter 2022 conference calls at this time all participants are in listen only mode.
It will be a question and answer session. After the prepared remarks.
Reminder, today's call is being recorded I would now like to turn the call effort to Justin <unk>, Chief Financial Officer Arnold Block you.
You may begin.
Thank you and good afternoon, everyone and welcome to our first quarter financial results call.
During this call we will refer to the press release, we issued earlier today, which is available in the investors section of the company's website at our Delek stock comp.
On the call with me today with prepared remarks are Mike Raab, President and CEO and Susan Rodriguez Chief Commercial officer.
Dr Williams, Chief Medical Officer, Dr. David Rosenbaum, Chief Development Officer, and Rob <unk>, Chief Regulatory Affairs, and quality Assurance officer will join us for the question and answer period.
During this call we will be making forward looking statements that are subject to risks and uncertainties.
Our actual results may differ materially from those described.
We encourage you to review our risk factors in our quarterly report filed on Form 10-Q earlier today, which can also be found at our website at our Delek stock comp.
While we may elect to update these forward looking statements in the future, we specifically disclaim any obligation to do so even if our views change.
With that let me pass the call over to Mike.
Thank you Justin and good afternoon, everyone. We're thrilled to provide an update on what has been a highly productive quarter filled with positive developments on both fronts.
'twenty two is off to a great start bra launches underway and progressing well after just a few weeks on the market and we're exposed are we welcomed the news from the FDA Advisory Committee will be convened to review and advise on the clinical meaningfulness of our data.
These are important catalysts, which have the potential to significantly build shareholder value in 2022.
The most significant driver of value growth for our Delta is in our anticipated success in commercialization of its rollout.
This is a remarkable time for the company as we now are seeing the results of years of research for our internally discovered and developed drug candidate transformative promising new therapeutics that is now in the hands of pharmacies and patients.
It's with great confidence that the torch so to speak has been passed for a highly capable and talented commercial team led by Susan Rodriguez.
In the initial days of once I have the pleasure of going into the field and observing firsthand knowledge skill and professionalism of our sales.
But also the physician receptivity and excitement as a gain awareness of its rollout.
The best news into later on the call provide a robust update on the progress we've made since our official launch of its rollout on April four of this fourth of this year, we can say that my observation, thus far consistent with the market research that Susan our teams have conducted regarding the need and attractiveness of our new therapy like its rollout.
Turning now briefly ticks those I'd like to review, where we stand with regards to our formula dispute resolution efforts.
At the end of April Dr. Peter Stein, the director of the office of New drugs Center for drug evaluation and research of USDA provided an interim response for a second level of appeal for the complete response letter for exposed and.
In which he indicated the need to continue in the cardiovascular and renal drugs Advisory committee or <unk>.
With expert clinician to gain additional insights into the clinical meaningfulness for the phosphate lowering effect observed in our phase III clinical program for our exposure.
We welcome them to advisory panel as it will allow for doctor sign to receive input from treating clinicians in order to understand their perspective of the clinical meaningfulness and significance of the phosphate production, we have demonstrated with exposure.
We are confident that apology community's belief in the novel mechanism of action of the disposal and the important role that it can play in addressing a critical unmet medical need in the management of hypercholesterolemia.
We await direction from Doctor sign on the timing of this meeting and look forward to the discussion.
Turning now to <unk> three we completed our analysis of the safety and efficacy from our phase two dose ranging trial.
For <unk> for the treatment of hyperkalemia in chronic kidney disease patients who are not on dialysis.
While the results of this study demonstrated an acceptable safety and Tolerability profile Friday excellent training and supported an important proof of concept and its ability to lower serum potassium levels with statistically significant results compared to placebo. After eight days of treatment. The study did not meet its primary endpoint of significantly reducing serum potassium levels compared to <unk>.
<unk> after four weeks of treatment.
The next steps for the program will be to continue work on new formulations and to evaluate the efficacy of Rdx I went through in a future phase III study.
In April we were pleased to announce that we had reached an agreement with our Japanese partner J Casey to amend our license agreement, providing us the potential for important near term non dilutive capital.
As we announced in April and consideration for a reduction in the royalty rate do our nellix upon net sales in Japan, KK single pay us up to an additional 40 million payable in two tranches. The first following their filings for marketing approval in Japan, and a second payment due following approval to market now.
Our four hyperplastic huge Tam.
The ACL by finalizing a phase III clinical program could snap norm, Brian for classic even as disclose its current expectation to file for marketing approval within the second half of this year and our current expectation that would receive a decision regarding this application in a SEC.
<unk> half of 2023.
In summary, as we kicked off 2022 with a launch of this rollout and now as a revenue generating company with the opportunity to support clinical meaningfulness of our clinical data for <unk> at an advisory committee, our pipeline of internally discovered drug candidates and our strengthening cash position, we see our Dallas is a highly differentiated company R&D.
St.
Neatly positioned for success with dedicated talented teams across the company.
Now I'd like to pass the call to Susan to provide a commercial update on the launch of its rollout Susan.
Thanks, Craig.
Mike's sentiments about our strong start to 2022, we've launched <unk>. Our first in class novel mechanism therapy for the treatment of irritable bowel syndrome with constipation Ibs D. In adults with initial stocking and the salesforce mobilized across the country commercial efforts are focused on the 9000 HCP.
To account for approximately 50% of the prescriptions written for Ibs C indicated product with broad based product distribution targeted specialty sales force and Omnichannel tactic marketing messages center on the multifactorial pathophysiology of Ibs C and the role of a novel Triple action mechanism of Israel.
Play to address important medical unmet need.
Revenue reported in Q1 reflect some of the initial stocking of Israel or in advance of our April 4th commercial launch.
Our only market response has been favorable.
Interest across our gastro neurology targets is high with our Salesforce being given quality time to review the novel product profile and robust clinical data for <unk> eight.
<unk> express the need for expanded options to treat Ibs C respond favorably to the information presented on its rollout and sure that there are many patients that they believe can benefit from a novel mechanism approach.
One patient abuse Burns rattler is being down.
The market environment, we are launching in Q is favorable the market building investments linked to the introduction and then D. C agonist over the past decade has transferring the management of Ibs D. Converting what was once an OTC market through an established prescription therapy market consolidated largely around two branded therapy with a.
Sure enough high writing HCP within the context of just establish prescription market. These hcp's persistently report that approximately a third of patients under their care continue to have symptoms and are considered to be inadequately minutes. This relatively uncluttered market with conditions that enable a targeted approach.
With a stated need for expanded therapeutic option is an ideal opportunity for Israel and with its differentiated first in class mechanism and compelling clinical profile are.
Our research indicates that 56% of high prescribers consider ibs C difficult condition to treat and 83% reported that there was a significant unmet need in the treatment of Ibs D. 75% of these high prescribers. We are part of the favorable response to the Israeli profile rating its novel mechanism.
Because these data as the most compelling attributes and projected use of Israel and a meaningful subset of their patients.
While we're still in the early weeks of March HCP response on the ground aligns with these research findings.
We are positioning <unk> as a first in class <unk> three inhibitor with a triple action in treating Ibs C. We are emphasizing the novel mechanism of Israel is differentiated from existing therapies.
With data that demonstrate significant improvement in abdominal pain, bloating and constipation with a quick onset of action sustained efficacy and an acceptable safety and Tolerability profile.
Our physician education is also centered around clinical results demonstrating improved patient quality of life versus placebo and patient reported treatment satisfaction.
Our objective is to establish himself with its new mechanistic approach and triple acting effect as a meaningful new treatment option for <unk> to treat patients with Ibs C.
Our sales force efforts targeted at the highest writers will be further amplified by omnichannel tactics, leveraging the rapidly advancing dynamics in the marketplace on how and where HCP has received their information.
Our distribution network is another key element to our commercial strategy, which includes both retail and specialty channels to accommodate office and patient preferences and aligned to their existing processes for handling specialty product.
As the launch progresses I'd like to reiterate what to expect.
<unk> access is key to market traction as a novel product. Our access strategy is centered on the value proposition of addressing the existing clinical unmet need among actively treated patients we will not rebase to match existing agents.
Chad will work with payers to minimize the step the requirements from.
From a payer landscape perspective prior authorization and step therapy protocol for novel entrants are standard for this market today Hcp's have to attest to the fact that patients have been on lower cost agent yet their condition persists and are considered to be inadequately minutes. We consider these access challenge.
Just to be addressable on the basis of four key consideration one the patient need for Impella for a condition with limited treatment options.
To HCP demand spreads rolla and willingness to support the prior authorization requirements three.
Three the HCP familiarity and experience in addressing these requirements and puts it in the space and for the comprehensive customer service support we will have in place to support physician offices.
In parallel we will work with payers to secure access and minimize step therapy and requirements.
Market penetration with Israel will be enabled by the existing pool of Ibs C. Patients that are in need of a novel mechanism therapy and considered good candidates for treatment with its rollout counterbalanced by access ramp up challenges and the need for HCP to work through the expected payer hurdles as I noted earlier with the.
Targeted specialty sales force full company engagement and innovative omnichannel peer to peer and digital initiatives, we will bring Israel launch in a patient is being actively managed today, who are in need of additional treatment options.
Israel and will have a strong commercial and clinical presence at the largest annual GI conference digestive disease week, taking place may 21st is the 24th in San Diego, We plan to leverage this conference as a major launch initiatives.
Our commercial initiatives and market receptivity are proceeding as anticipated gastroenterologist are responding favorably James dressler mechanism and clinical profile.
We are enthusiastic to have a new addition to their treatment armamentarium and have patients in mind that can benefit from Australia. They anticipate prior authorization requirements and are motivated to utilize the structures and processes. They haven't placed in their offices to work through access hurdle in many cases in partnership with specialty pharmacies or.
Our our Dallas assist patient services program.
Prescriptions are being written and filled we are thrilled to bring this much needed highly differentiated therapies to market and most importantly to make a difference in the lives of patients who are suffering from Ibs D. I will now turn the call over to Justin to review, our Q1 2022 financial Justin.
Thank you Susan.
We ended the first quarter 2000 2022.
We had total cash cash equivalents and short term investments of $89 $7 million as.
Total cash cash equivalents and investments of $116 7 million as of December 31, 2021.
As we just discussed we recognized our first commercial product sale from initial drove restocking in March the approximately <unk> 5 billion.
Research and development expenses were $8 $9 million for the quarter ended March 31, 2022, a decrease of $11 6 million or 57% compared to $20 5 million for the same quarter last year.
The decrease in R&D expenses is primarily the result of lower clinical study costs from the optimized study.
Lower cannabinoid manufacturing expense as we've begun to capitalized costs associated with inventory and lower expenses. Following the elimination of our research function in the fourth quarter of 2021.
Selling general and administrative expenses were $19 $3 million for the quarter ended March 31, 2022, an increase of $2 2 million or 13% compared to $17 $1 million from the same quarter last year the.
The increase in SG&A expenses was primarily due to an increase in costs associated with preparations for the commercial launch of Israel.
Our net loss for the quarter ended March 31, 2022 was $28 1 million or 21 per share compared to $33 $2 million or <unk> 34 per share for the same quarter last year.
It is important for us to bolster our cash position and we will continue to pursue and evaluate a number of opportunities, including non dilutive measures such as commercial sales of impella milestone payments from our partners as well as judicious cash management.
Along those lines. During Q1, we prudently took advantage of our ATM raising $6 million of proceeds from equity sales under the program.
As Mike mentioned earlier in April we announced we amended our license agreement with KKR.
Consideration for a reduction in future royalties on net sales in Japan, <unk> agreed to pay our delek consideration of up to an additional $40 million.
<unk> reported their Q1 2022 results earlier this week and they noted that they remain on track to file their NDA for snapple, but I prefer the team in Japan in the second half of this year, which in addition to the proceeds we have received under our lease Amendment will also trigger a significant regulatory milestone payment to our Dallas.
Our original license agreement.
We will continue to actively pursue other non equity sources to extend our cash runway further into 2023, we have confidence in our ability to continue to fund our operations.
I will now turn the call back to Mike for some concluding comments before we take.
Two questions Mike.
Thanks, Justin and before I open the call I want to emphasize a couple of points.
We look forward to making the case for exposes the Fda's Advisory committee in the coming months as we believe it will be in a central treatment for patients on dialysis with Hypophosphatasia.
And although we are just over a month into the launch we liked the positive response, we hear from the field for Israel and the role that it can play in treating patients with Ibs C C.
Susan has built a spectacular commercial team and they are laser focused on successful execution working to gain meaningful market share.
The opportunity for us with its relatively significant as it provides a clear line of sight to financial breakeven.
Finally, this is an exciting and truly transformational time for our <unk> and we are becoming an impressive growth story with lots of opportunities ahead.
It's really important to note our internally discovered pipeline has fueled diversification and critical optionality as positioned us well for near term and long term future growth.
We look forward to keeping you apprised of our progress and with that I will now open the call to questions Debbie.
We will now begin the question and answer session.
To ask a question you May press Star then one on your telephone keypad, if youre using a speakerphone. Please pick up your handset before pressing the key.
Your question. Please press Star then two.
At this time, we will pause momentarily to assemble our roster.
The first question is from Chris Howerton with Jefferies.
Please go ahead.
Excellent. Thank you so much.
Excellent news on the Advisory Committee update and thanks for taking the questions team.
So I guess, maybe what I'll start off by it with respect to the Advisory committee for expose.
I think Mike you had mentioned that youre expecting within the coming months.
Be curious to hear if you could articulate just give us a little color on your thinking on the timing of that.
Also as it relates to the Advisory Committee do you anticipate providing any additional information to the FDA prior to that outside of just the standard briefing documents.
And if I may as a third part of that question would be what is the significance of patient advocacy groups.
In your argumentation in discussing the clinical meaningfulness of exposure. Thank you sure. Thanks, Chris for the questions.
So we've not yet heard back from Bucca signs office and once we do obviously, that's a meaningful but it means that we would release so our anticipation is that its not going to be lumpy.
Before we hear every weeks and we're thinking that we're going to have three plus months to prepare until.
So you could imagine we've already deployed and are working.
Working multiple full time jobs in order to be as prepared as we can for the outcome.
With regards to your second question there will be no new data submitted we will provide our briefing book as a whole day.
And we can only work with the data that has been something that is part of our NDA, which as all of our clinical work and not the entire phase III program.
So there's a lot there to work with as we've talked about.
Since over a year ago, we received a <unk>. So we're confident with the strength of those data as we prepare for the meeting.
Patient and advocacy is a critical part of this and these are patients as you can probably imagine and physicians that we've heard from nonstop since the <unk> was officially was originally issued just over a year ago, we have been holding back because we wanted to be thoughtful going through the IPR process.
But those are closer chomping at the bit to.
And to be part of having their voice heard of the importance of a drug like expose and blocking phosphorus versus having to be absorbed with all the same mechanism goes out there today. So it will be a critical part of what we do working with the patient community.
Okay.
Well, that's I mean, like I said, I think that that excellent that you've been given that opportunity. So really honestly it really looking forward to that and.
I don't know if you allow me, but if I could sneak in one more your for you Susan.
With respect to kind of the launch of <unk>.
What is your position on things like sampling or other.
Other methodologies such as that to increase demand.
Oh, Thanks for the question Chris.
You know clearly what we find with the Gastroenterologists that we are engaged with today that the way they practice the treatment of Ibs D is to sample the patient, especially particularly when they're starting a new therapy to see how the patient responds to that therapy early on and based on that response.
With the prescription and with working through the prior off requirements that they anticipate.
Having to manage for a specialty drug like thriller. So sampling is clearly a part of our strategy, but we are pragmatic about it in terms of getting the samples into the offices of the high writers to help them get these new patients started but not sampling to a level, where we're going to interfere with the ramp up.
The products that the demand in prescriptions is a very important component to our ramp up you know to demonstrate demand from the gastro the high writing gastro to the payers as we work through the process to secure access brands rollout.
Okay well that's.
That's very clear thank you very much and I appreciate you taking the questions.
Thanks, Chris Thanks, Craig.
Our next question is from Yigal <unk> with Citi. Please go ahead.
Okay, Hi, this is carly on for Yigal. Thanks, so much for taking our question.
Just a follow up on some of your prior comments can you talk in a little bit more detail.
What you're doing to prepare for those that AD com I guess are there.
Any additional analyses, you're putting together or can put together to help strengthen the argument around the clinical meaningfulness of the data.
Sure. Thanks, Charlie.
A lot of that is being prepared.
A.
Broadway show or something like that to make sure that you are saying all the right things and limited amount of time that you have so you're going to be looking at.
The science behind that the clinical data the patient need all of those things with different people in their presentations, where you've seen with other AD comm meeting.
So there are no new.
As I've said in previous question the only data that are going to be submitted.
<unk> had all the data since we filed the NDA, but certainly we will focus on what we believe are representative of clinical meaningfulness.
Just to remind everyone is this is a program that was completely reviewed every single clinical protocol statistical analysis plan.
Endpoints everything was reviewed with the agency in detail.
And even though they recognize the significance of the decrease that we got.
I suppose.
We had every single primary and key secondary endpoints with highly statistically significant result.
And we will clearly emphasize that and the need that the patients have for something that's different.
Taking handfuls of pills every single day.
It doesn't work because they are unable to take as much as they should.
Physician should be given the opportunity with the data that we have generated to make the decision based upon those results on which of their patients are candidates for not for export.
Okay, Great. That's really helpful. And then we just had one question for Justin can you comment on how far is the additional 40 million expected from T. H K.
Might extend the cash runway.
Sure. Currently so we are hopeful as we mentioned <unk> to file this second half of this year and then seek approval from the agency in the second half of 2023 in Japan, we haven't disclosed the breakdown of the $40 million, it's going to be in two tranches between this fall and next fall.
$40 million will clearly impact our runway upon receipt certainly targeting second half of this year and next year or so.
Our burn will be going down as we grow our sales force zarrella. So I can't give you specific.
How long of a $40 million at its clearly a material impact and extending our runway into 2023.
Okay got it thanks, so much for taking our questions.
Thanks Carlin.
The next question is from Joseph Thome with Cowen and company.
Please go ahead.
Hi, there good afternoon, congrats on the progress and thank you for taking my questions. Maybe the first one just on the Advisory committee or are you able to sort of suggest a label. So maybe if they don't feel comfortable giving a broad label for serum phosphorus production and patients can you say.
And on top of binders are patients that can't tolerate binders are you able to kind of suggest anything that might make it a little bit easier.
And palatable for the FDA to to approve there.
Yes, remember the audience for the outcome are the members of the advisory panel.
Donald.
The FDA as much right.
So the AD com, we're going to be speaking to establish had comments there as well as these additional participants with doctor sign referenced in his letter to us.
And what we will say to them is the treatment of Hyperpotassemia is something thats considered at a minimum monthly as it relates to the serum phosphorus levels that are taken of every single dialysis patients at least once a month and often weekly or three times a week when they are in a dialysis session.
The dietician, social worker to staff their thinking and to remind them to wash their phosphorus, which is standard fare.
So the FDA will hear the panel importantly, you'll hear that understanding which patients are going to respond to which drug is something that's a very straightforward thing that they're accustomed to doing today.
And that the data that we have generated represent powerful information for those physicians and caregivers that are part of the dialysis process to identify those patients who respond and those who.
Parks or those who tolerate in those adult just as is the case today with binders and right now the only thing that they can do is switch to another binder or out of binder, which is nonsensical because they're not different from each other meaningfully in terms of the efficacy that they produce so that's really the way that we will approach. It I don't think we would go in.
This is a proposed label that's not really the purpose of the presentation for the outcome.
Got it and then.
It's thriller I mean, you mentioned some restocking.
How should we think about revenues on a quarterly basis or are they going to be reflective of kind of true patient demand or is there going to be any pattern to stocking the channel or anything like that.
Yes, I mean, we're five weeks into this so everything that we know thus far is anecdotal it's exciting it's really it's a wonderful experience to be.
The receiving end of those anecdotes given the over decade work that we've been doing it our goal is to get this drug to the market.
So we're not in a position right now to be projecting what were providing guidance as to what revenue is going to look like.
Please be patient with us as we learn and.
We'll learn to as we looked at the reliability of scripts that come from ITW ever since the name.
As Susan mentioned, there's a lot of specialty pharmacy, that's in the that we need to wrap our arms around and all of you do too as well as they look and see where those data are best reported. So this is as I said a period of anecdotal evidence that is exciting positive in all in the right direction is it premature to be giving any specifics as to what that exactly right.
And then maybe one more quick one if I can just readjusting R&D.
R&D came down a lot which is great to see.
That makes sense standpoint is this now kind of the new steady state or is there still room to them to come down in future quarters.
Sure that's fair.
For Q1, and the rest of this year I think that's a fair number one thing we did call out in the.
Press release is the stock compensation expense the noncash charge that is obviously highly variable so that could have an impact, but again that won't affect us one way, but the overall.
Research and development expenditure for the remainder of this year should be pretty consistent or slightly lower the rest of this year.
Great. Thank you so much.
Thanks, John .
The next question is from Laura Chico with Wedbush.
Please go ahead.
Good afternoon.
This is Sam on for Laura Chico. Thanks for taking our question. So we have one on the <unk> Advisory Committee meeting just wondering if you could frame for us the <unk>.
Range of outcomes.
It might come out of this meeting thank you very much.
Wow.
It can be a unanimous vote yes.
No and everything in between.
And all of US have observed the peculiarities would've happened outcomes over the last year plus so.
This is a site that we're continuing to fight we believe strongly in our data. We believe the voice of the Kols have been part of this and those who had read about it in all of our.
Clinical programs have now been published so as is well known and well recognized out in the field as to what it is that expose it can provide their patients so getting to those.
Those physicians and patients who understand that and communicating that effectively to the outcome. We believe will help us be on the right side of that boat versus on the negative side and as we all know the.
The agency is not required to take the advice for their own committed so that continues to be something that we will watch closely and feel that the <unk>.
<unk> argument will be one that carries the day.
Makes sense. Thank you.
Again, if you have a question. Please press Star then one.
The next question is from Matt Kaplan.
Ladenburg Thalmann. Please go ahead.
Hey, guys. Thanks for taking the questions.
That's on the AD com.
Just a follow up to the last question in terms of.
Im assuming you have a positive result from the outcome.
What's the timing after that for a potential FDA action on <unk>.
Yes, since we don't have an active NDA in place, let me actually ask Rob blanks, our chief regulatory and quality assurance officer to address the outcomes.
Type of NDA, we could potentially fit that.
Yeah. Thank you Mike.
Just to let you know obviously this is this AD com as a response to.
R R.
Our appeal drill N D. So what we do know is that 30 days after we get our risks.
<unk> Com has held you'll get a response from OND.
As to the final outcome of our appeal from there we would.
Provided we prevail then we would likely have a complete response and.
B, a two month review of our NDA and.
Which would mostly be label negotiations at that point.
Or the alternative is a six month review.
Got it okay. That's very helpful. Thank you.
And then and then.
Shifting to dwell on launch can.
Can you give us a sense.
In terms of.
The rollout of our.
Payer coverage and patient access.
A corresponding to that in terms of commercial plans.
Medicare and Medicaid.
Plan quickly.
How we should think about that kind of in the coming year.
Sure Susan.
Yeah. Thank you Matt for the question. So so first and foremost it's really important to call out in the early launch phase that there is access to Israel.
For the physicians, who are willing to go through the exception process and what we're finding in these early stages because of the way the novel mechanism of the drug the way we are positioning it to focus on using this drug in patients that they believe really need a different approach to their treatment. They are motivated to go through that exception.
Process, and we are seeing them clear through that process.
As I mentioned in my.
Narrative and as Mike had alluded to we're finding that these high writing Gastro group saw are quite linked to and in many cases, the specialty pharmacies do help them with clearing these map these exception hurdles.
Remember that the world of the Gastroenterologists Theyre involved in writing a lot of specialty products in our spaces with a coffee therapies ulcerative colitis crohn's HDD. So we're finding that they have processes in place. So so this this early launch phase is really very much about creating that demand and really.
Leveraging that motivation on the part of the Gastroenterology grips to work through the exceptions and get these prescription trends as we do that we interface with parents choose to try to break down some of those hurdles and makes it easier for these physicians to choose to carry is relative to the patients that they believe really need it.
Overall, we anticipate that the access in the commercial side will probably come first.
Just in terms of starting to secure that position and this is something that we're going to work on we see throughout this launched up here in 2022.
Followed by Medicare and Medicaid and there's always the more challenging one from a timeline perspective in terms of trying to knock down some of those barriers.
Okay. Okay. Thank you and then.
In terms of pricing and gross to net.
I mean I.
<unk>.
Comment on that.
Hey, Susan.
Yeah on overall, well that we have.
<unk> announced the price firms roller at $1500 a month. So the the rationale around that pricing is linked to the clinical value proposition again that it's really a telus unopposed in the market today for the patients who are not adequately managed there are no other options.
Within the range of Ibs treatment, we see it ranges from around $500 to a high end of 1800 for $2000 for the Ibs diarrhea products.
This is within the range of the Ibs.
Pricing landscape. So that's a price point and it's priced to a link to the value proposition and the targeted approach and our objective that we had laid out there and believe that we can achieve a high a high single digit share within this marketplace and in terms of the cost side of it we as I.
Mentioned, we will not be rebating to match, our positions of Linzess and Sheila as you know the way. This market has cut its established those products are locked in.
You know some plants preferred linzess, some drive preference to chew and we're not competing with that because we are where we are focusing on the patients who are in need of a different approach and physicians are motivated to work through those exceptions. So.
From a seller from a gross to net standpoint, we're not going to be heavily resetting the product. So we will be working with payers to try to minimize those hurdles.
Yeah, and then beyond that it's really just our distribution network and then we need to contemplate as well it's important to consider the affordability side of the access equation and for commercial patients. We will have a commercial co pay program to be able to offset their out of pocket expense for their Israel a script.
Those are the key considerations.
Okay. Thank you lay out in detail.
Thanks for the question.
Thanks, Matt.
Yes.
A question and answer session I would now like to turn the conference back over to Mike Raab for any closing remarks.
Thank you all for joining our call and staying abreast of our transformational progress as we launch it is relevant patients with Ibs C and continue to navigate the regulatory process would expose them. We look forward to keeping you apprised of our progress in the coming months Debbie you may now end the call.
The conference has now concluded. Thank you for attending today's presentation you may now disconnect.
Yeah.
Third remarks as a reminder, today's call is being recorded.
I'd now like to turn the call over to Justin Renz, Chief Financial Officer of Bartleby.
May begin.
Thank you and good afternoon, everyone and welcome to our first quarter financial results call.
During this call we will refer to the press release, we issued earlier today, which is available in the investors section of the company's web site at our Delek Dot com.
On the call with me today with prepared remarks are Mike Raab, President and CEO and Susan Rodriguez, Chief Commercial Officer Dr.
Dr Williams, Chief Medical Officer, Dr. David Rosenbaum, Chief Development Officer, and Rob <unk>, Chief Regulatory Affairs, and quality Assurance officer will join us for the question and answer period.
During this call we will be making forward looking statements that are subject to risks and uncertainties.
Our actual results may differ materially from those described.
We encourage you to review our risk factors in our quarterly report filed on Form 10-Q earlier today, which can also be found at our website at our <unk> Dot com.
While we may elect to update these forward looking statements in the future, we specifically disclaim any obligation to do so even if our views change.
With that let me pass the call over to Mike.
Thank you Justin and good afternoon, everyone. We're thrilled to provide you an update on what has been a highly productive quarter filled with positive developments on multiple fronts.
Avast user into later on the call provided robust update on the progress we've made since our official launch of its rollout on April for this fourth of this year.
I can say that my observations, thus far consistent with the market research that Susan and her team have conducted regarding a need and attractiveness of our new therapy like a drilling.
Turning now briefly to expose I'd like to review, where we stand with regards to our formal dispute resolution efforts.
At the end of April Dr. Peter Stein, the director of the office of New drugs Center for drug evaluation and research of the FDA provided an interim response for a second level of appeal for the complete response letter for exposed.
And which he indicated that means it can be in the cardiovascular and renal drugs Advisory Committee.
<unk> with expert clinicians to gain additional insights into the clinical meaningfulness for the phosphate lowering effect observed in our phase III clinical program for <unk>.
We welcome this advisory panel as it will allow for doctors time to receive input from treating clinicians in order to understand their perspective of the clinical meaningfulness insignificant to the phosphate reduction we have demonstrated with exposure that we.
We are confident in the nephrology community believes in the novel mechanism of action of exposure and the important role that it can play in addressing a critical unmet medical need in the management of Hypophosphatasia.
We await direction from Doctor sign on the timing of this meeting and look forward to the discussion.
Turning now to <unk> three we completed our analysis of the safety and efficacy from our phase two dose ranging trial.
For <unk> three for the treatment of hyperkalemia in chronic kidney disease patients who are not on dialysis.
While the results of this study demonstrated an acceptable safety and Tolerability profile Friday excellent training and supported an important proof of concept and its ability to lower serum potassium levels with statistically significant results compared to placebo. After eight days of treatment. The study did not meet its primary endpoint of significantly reducing serum potassium levels compared to put.
Zero after four weeks of treatment when appropriate next steps for the program will be to continue work on new formulations and to evaluate the efficacy of Rdx <unk> three in a future phase III study.
In April we were pleased to announce that we had reached an agreement with our Japanese partner Casey to amend our license agreement, providing us the potential for important near term non dilutive capital.
As we announced in April and consideration for a reduction in the royalty rate do our nellix upon net sales in Japan, KK C will pay us up to an additional 40 million payable in two tranches.
Following their filings for marketing approval in Japan in the second payment due following the approval to market <unk>.
For hydro flask the team in Japan.
The Acs violent finalizing a phase III clinical program, it's an abnormal drag for classic Humana disclose its current expectation 2000 marketing approval within the second half of this year and our current expectation that would receive the decision regarding this application in the second half of 2023.
In summary, as we kicked off 2022 with the launch of Israel and now as a revenue generating company with the opportunity to support clinical meaningfulness of our clinical data for exposure at an advisory committee the pipeline of internally discovered drug candidates and our strengthening cash position, we see our dollar to the highly differentiated company R&D.
<unk> uniquely positioned for success with dedicated talented teams across the company.
Now I'd like to pass the call to Susan to provide a commercial update on the launch of Israel Susan.
Thanks, Craig.
Mike's sentiments about our strong start to 2020, we launched <unk>. Our first in class novel mechanism therapy for the treatment of irritable bowel syndrome with constipation Ibs D. In adults with initial stocking and the salesforce mobilized across the country commercial efforts are focused on the 9000 HCP.
To account for approximately 50% of the prescriptions written for Ibs D indicated product for us.
Rod based product distribution targeted specialty sales force and Omnichannel tactics marketing messages center on the multifactorial pathophysiology of Ibs C and the ROE the novel Triple action mechanism of Israel can play to address important medical unmet need.
Revenue reported in Q1 reflect some of the initial stocking of Israel in advance of our April 4th commercial launch.
Our only market response has been favorable.
Interest across our gastroenterology targets is high with our sales force being given quality time to review the novel product profile and robust clinical data for Australia.
<unk> express the need for expanded options to treat Ibs D respond favorably to the information presented on its rollout and sure that there are many patients that they believe can benefit from a novel mechanism approach a foundation of use for the trailer is being built.
The market environment, we are launching into is favorable the market building investments linked to the introduction.
This is the agonist over the past decade has transferring the management of Ibs D. Converting what was once an OTC market through an established prescription therapy market consolidated largely around two branded therapy with a concentration of high writing HCP within the context of this established prescription market.
<unk> persistently report that approximately a third of patients under their care continue to have symptoms and are considered to be inadequately minutes. This relatively uncluttered market with conditions that enable a targeted approach with a stated need for expanded therapeutic option is an ideal opportunity for its rollout with its differentiation.
David first in class mechanism and compelling clinical profile.
Our research indicates that 56% of high prescribers consider Ibs C. A difficult condition to treat an 83% reported that there was a significant unmet need in the treatment of Ibs D. 75% of these high prescribers reported a favorable response to the Israel profile waiting its novel mechanism.
Efficacy data as the most compelling attributes and projected use of Israel and a meaningful subset of their patients.
While we are still in the early weeks of March HCP response on the ground aligns with these research timing.
We are positioning <unk> as a first in class <unk> three inhibitor with a triple action in treating Ibs C. We are emphasizing the novel mechanism of Estrella is differentiated from existing therapies.
With data that demonstrate significant improvement in abdominal pain, bloating and constipation with a quick onset of action sustained efficacy and an acceptable safety and Tolerability profile.
Our physician education is also centered around clinical results demonstrating improved patient quality of life versus placebo and patient reported treatment satisfaction.
Our objective is to establish Israel with its new mechanistic approach and triple acting effect as a meaningful new treatment option for <unk> to treat patients with Ibs C.
Our sales force efforts targeted at the highest writers will be further amplified by omnichannel tactics, leveraging the rapidly advancing dynamics in the marketplace on how and where HCP has received their information.
Our distribution network is another key element to our commercial strategy, which includes both retail and specialty channels to accommodate office and patient preferences and aligned to their existing processes for handling specialty products.
As the launch progresses I'd like to reiterate what to expect.
Patient access is key to market traction as a novel product. Our access strategy is centered on the value proposition of addressing the existing clinical unmet need among actively treated patients we will not rebase to match existing agents.
Chad will work with payers to minimize the step the requirements.
From a payer landscape perspective prior authorization and step therapy protocol for novel entrants are standard for this market today.
<unk> have to attest to the fact that patients have been on lower cost agents yet their condition persists and are considered to be inadequately manage we consider these access challenges to be addressable on the basis of four key consideration one the patient need for Impella for a condition with limited treatment.
Chen to HCP demand for thriller and willingness to support the prior authorization requirements three the HCP familiarity and experience in addressing these requirements implicit in this space and for the comprehensive customer service support we will have in place to support physician offices.
In parallel we will work with payers to secure access and minimized step therapy requirements.
Market penetration with Israel will be enabled by the existing pool of Ibs C. Patients that are in need of a novel mechanism therapy and considered good candidates for treatment with Israel.
Counterbalanced by access ramp up challenges and the need for <unk> to work through the expected payer hurdles as I noted earlier with.
With a targeted specialty sales force full company engagement and innovative omnichannel peer to peer and digital initiatives, we will bring <unk> to the patients being actively managed today, who are in need of additional treatment options.
Israel and will have a strong commercial and clinical presence at the largest annual GI conference digestive disease week, taking place May 21, the 24th in San Diego, We plan to leverage this conference as a major launch initiatives.
Our commercial initiatives and market receptivity are proceeding as anticipated gastroenterologists are responding favorably to James Rolla mechanism and clinical profile. They are enthusiastic to have a new addition to their treatment armamentarium and have patients in mind that can benefit from Australia. They anticipate prior authorization.
<unk> and are motivated to utilize the structure and processes. They have in place in their offices to work through access hurdles in many cases in partnership with specialty pharmacies or to our <unk> assist patient services program Pritzker.
Prescriptions are being written and filled we are thrilled to bring this much needed highly differentiated therapy to market and most importantly to make a difference in the lives of patients who are suffering from Ibs D. I will now turn the call over to Justin to review, our Q1 2022 financial Justin.
Thank you Susan.
We ended the first quarter 2000 2022.
We had total cash cash equivalents and short term investments of $89 7 million as compared to total cash cash equivalents and investments of $116 7 million as of December 31, 2021.
As we just discussed we recognize our first commercial product sales from initial address pre stocking in March approximately one 5 billion.
Research and development expenses were $8 $9 million for the quarter ended March 31 2022.
Decrease of $11 6 million or 57% compared to $20 5 million for the same quarter last year.
The decrease in R&D expenses is primarily the result of lower clinical study costs can be optimized study lowered.
Lower cannabinoid manufacturing expense as we've begun to capitalized costs associated with the inventory and lower expenses. Following the elimination of our research function in the fourth quarter of 2021.
Selling general and administrative expenses were $19 3 million for the quarter ended March 31, 2022, an increase of $2 2 million or 13% compared to $17 $1 million from the same quarter last year.
The increase in SG&A expenses was primarily due to an increase in costs associated with preparations for the commercial launch of its relevant.
Our net loss for the quarter ended March 31, 2022 was $28 1 million or 21 per share compared to $33 2 million or 34 per share for the same quarter last year.
It is important for us to bolster our cash position and we will continue to pursue and evaluate a number of opportunities, including non dilutive measures such as commercial sales have been strong.
Milestone payments from our partners as well as judicious cash management.
Along those lines. During Q1, we prudently took advantage of our ATM raising $6 million of proceeds from equity sales under the program.
As Mike mentioned earlier in April we announced we amended our license agreement with TK.
In consideration for a reduction in future royalties upon net sales in Japan, <unk> agreed to pay our delek consideration of up to an additional $40 million.
<unk> reported their Q1 2022 results earlier this week and they noted that they remain on track to file their NDA for <unk> for <unk> in Japan in the second half of this year, which in addition to the proceeds we receive under our lease amendments with also trigger a significant regulatory milestone payment to our dose.
Our original license agreement.
We will continue to actively pursue other non equity solutions to extend our cash runway further into 2023, we have confidence in our ability to continue to fund our operations.
I will now turn the call back to Mike for some concluding comments before we take some questions Mike.
Thanks, Josh and before I open the call I want to emphasize a couple of points, we look forward to making a case for exposed with the Fda's Advisory Committee in the coming months as we believe it will be in a central treatment for patients on dialysis with Hypophosphatasia.
And although we are just over a month into the launch we liked the positive response, we hear from the field for drawn and the role that it can play in treating patients with Ibs C. Susan has built a spectacular commercial team and they are laser focused on successful execution working to gain meaningful market share.
The opportunity for us with its grella as significant as it provides a clear line of sight to financial breakeven.
Finally, this is an exciting and truly transformational time for our <unk> and we are becoming an impressive growth story with lots of opportunities ahead.
It's really important to note our internally discovered pipeline has fueled diversification and critical optionality and positioned us well for near term and long term future growth.
We look forward to keeping you apprised of our progress and with that I will now open the call to questions Debbie.
We will now begin the question and answer session.
To ask a question you May press Star then one on your telephone keypad. If you are using a speakerphone. Please pick up your handset before pressing the key to it.
Your question. Please press Star then two.
At this time, we will pause momentarily to assemble our roster.
The first question is from Chris Howerton with Jefferies.
Please go ahead.
Excellent. Thank you so much.
Excellent news on the Advisory Committee update and thanks for taking the questions team.
So I guess, maybe what I'll start off by with respect to the Advisory Committee for exposed.
I think Mike you had mentioned that youre expecting within the coming months.
Be curious to hear if you could articulate just give us a little color on your thinking on the timing of that.
Also as it relates to the Advisory Committee do you anticipate providing any additional information to the FDA prior to that outside of just the standard briefing documents.
And if I may as a third part of that question would be what is the significance of patient advocacy groups.
In your argumentation in discussing the clinical meaningfulness of exposure. Thank you sure. Thanks, Chris for the questions.
So we've not yet heard back from Bucca signs office and once we do obviously thats a meaningful but it means that we would release so our anticipation is that its not going to be months.
The months before we hear every week and we're thinking that we're going to have three plus months to prepare.
So you could imagine we've already deployed and are working.
Working multiple full time jobs in order to be as prepared as we can for the outcome.
With regards to your second question, there will be no new data submitted.
We will provide our briefing book as all day.
And we can only work with the data that has been submitted as part of our NDA, which as all of our clinical work and not the entire phase III program.
Theres a lot there to work with that we've talked about.
It's over a year ago, we received a zero and so we're confident with the strength of those data as we prepare for the meeting.
Patients and paywall advocacy is a critical part of this and these are patients as you can probably imagine and physicians that we've heard from nonstop since the CRM was officially was originally issued just over a year ago.
We have been holding back because we wanted to be thoughtful going through the IPR process.
Those are folks who are chomping at the bit too.
And to be part of having their voice heard of the importance of a drug like exposure and blocking phosphorus versus having to be absorbed with all the same mechanism goes there today. So it will be a critical part of what we do working with the patient and kind of our community.
Okay.
Well, that's I mean, like I said, I think that that excellent that you've been given that opportunity. So really honestly it really looking forward to that and I don't know if you allow me, but if I could sneak in one more area for you Susan.
With respect to kind of the launch of <unk>.
What is your position on things like sampling or.
Other methodologies such as that to increase demand.
Thanks for the question Chris.
This is clearly what we find with the Gastroenterologists that we are engaged with today that the way they practice the treatment of Ibs D is to sample the patient, especially particularly when they are starting a new therapy to see how the patient responds to that therapy early on and based on that response.
Proceed with a prescription and with working through the prior off requirements that they anticipate.
We're having to manage for a specialty drug like <unk>. So sampling is clearly a part of our strategy, but we are.
<unk> about it in terms of getting the samples into the offices of the high writers to help them get these new patients started but.
But not sampling to a level, where we're going to interfere with the ramp up of the products that the demand in prescription there is a very important component to our ramp up of them.
Constraint demand from the gastro the high writing gastro to the payers as we work through the process of care access France rollout.
Okay well that's.
That's very clear thank you very much and I appreciate you taking the questions.
Thanks, Chris Thanks, Craig.
The next question is from Yigal <unk>.
<unk> with Citi. Please go ahead.
Great Hi, this is carly on for Yigal. Thanks, so much for taking our question.
Just a follow up on some of your prior comments can you talk in a little bit more detail.
About what youre doing to prepare for the expose the AD com I guess are there.
Any additional analyses, you're putting together or can put together to help strengthen the argument around the clinical meaningfulness of the data.
Sure. Thanks, Charlie.
A lot of that is being prepared.
<unk>.
<unk>.
Broadway show or something like that to make sure that you are saying all the right things and limited amount of time that you have so youre going to be looking at.
The science behind that the clinical data the patient need all of those things with different people in their presentations, where you've seen with other AD comm meeting.
So there are no new.
As I said to a previous question no new data that are going to be submitted.
<unk> had all the data since we filed the NDA certainly we will focus on what we believe are representative clinical meaningfulness.
Just to remind everyone is this is a program that was completely reviewed every single clinical protocol statistical analysis plan.
And clients everything was reviewed with the agency in detail.
And even though <unk> recognized the significance of the decrease that we.
Got it.
We had every single primary and key secondary endpoint with highly statistically significant result.
And we will clearly emphasize that and the need that the patients have for something thats different.
Taking handfuls of pills every single day.
It doesn't work because they are unable to take as much as they should.
Physician should be given the opportunity with the data that we have generated to make the decision based upon those results on which of their patients are candidates for not for exploration.
Okay, Great. That's really helpful. And then we just had one question for Justin can you comment on how far the additional $40 million expected from T. H K.
Extend the cash runway.
Sure. Currently so we are hopeful as we mentioned <unk> seen a trial in the second half of this year and then seek approval from the agency in the second half of 2023 in Japan, we haven't disclosed the breakdown of the $40 million, it's going to be in two tranches between this fall and next fall.
With $40 million will clearly impact our runway upon receipt certainly targeting second half of this year and next year or so.
Brian will be going down as we grow our sales force rollout. So I can't give you specific.
How long of a $40 million add is clearly a material impact and extending our runway into 2023.
Okay got it thanks, so much for taking our questions.
Thanks, Ron.
The next question is from Joseph Thome with Cowen and company.
Please go ahead.
Good afternoon, congrats on the progress and thank you for taking our questions. Maybe the first one just on the Advisory Committee are you able to sort of suggest a label. So maybe if they don't feel comfortable giving a broad label for.
Serum phosphorus production and patients can you say only use it on top of binders or patients that can't tolerate binders are you able to kind of suggest anything that might make it a little bit easier.
And palatable for the FDA to.
To approve there yes.
Yes, remember the audience for the outcome are the members of the advisory.
Panel.
As much right.
So the AD com, we're going to be speaking to you establish had comments there as well as these additional participants with doctor sign referenced in his letter to us.
And what we will say to them.
The treatment of Hyperglycemia is something Thats considered at a minimum monthly as it relates to the serum phosphorus levels that are taken of every single dialysis patients at least once a month and Boston weekly or three times a week when they are in a dialysis session.
Dietician social worker the staff there continue to remind them to wash their phosphorus, which is standard fare.
The FDA will appear the panel importantly were here that understanding which patients are going to respond to which drug is something that's a very straightforward thing that they are accustomed to doing today.
The data that we have generated represent powerful information for those physicians and caregivers that are part of the dialysis process to identify those patients who respond and those who.
Parks or those who tolerate in those adult just as is the case today with binders and right now the only thing that they can do is switch to another binder or Adam binder, which is nonsensical because they're not different from each other meaningfully in terms of the efficacy that they produce so that's really the way that we'll approach. It I don't think we would go in.
This is a proposed label that's not really the purpose of the presentation for the outcome.
Got it and then for <unk> I mean.
You mentioned some restocking I guess, how should we think about revenues on a quarterly basis or are they going to be reflective of kind of true patient demand or is there going to be any pattern to stocking the channel or anything like that.
Yes, I mean, we're five weeks into this so everything that we know thus far is anecdotal it's exciting it's really it's a wonderful experience will be.
The receiving end of those anecdotes given the over decade work that we've been doing it our goal is to get this drug to the market.
So we're not in a position right now to be projecting for providing guidance as to what revenue is going to look like.
Please be patient with us as we learn and you will learn to as we looked at the reliability of scripts that come from my <unk>.
Susan mentioned, there's a lot of specialty pharmacy, that's in the that we need to wrap our arms around and all of you do too as well as they look and see where those data are best reported. So this is as I said a period.
Total evidence that is exciting positive in all in the right direction, the premature to be giving any specifics as to what that segment. Thanks.
Okay, and then maybe one more quick one if I can just readjusting R&D.
R&D came down a lot, which is great to see what.
Makes sense standpoint is this now kind of the new steady state or is there still room to come down in future quarters. Thank you.
Sure that's fair.
For Q1, and the rest of this year I think Thats a fair number one thing we did call out in the.
Press release is the stock compensation expense the noncash charge that is obviously highly variable so that could have an impact, but again that won't affect our runway, but the overall.
Size of the research and development expenditure for the remainder of this year should be pretty consistent or slightly lower the rest of this year.
Great. Thank you so much.
Thanks, John .
The next question is from Mark <unk> with Wedbush.
Please go ahead.
Good afternoon.
This is Sam on for Laura Chico. Thanks for taking our question. So we have one on the <unk> Advisory Committee meeting just wondering if you could frame for us the <unk>.
Range of outcomes.
It might come out of this meeting thank you very much.
Wow.
It can be a unanimous vote yes.
No and everything in between.
And all of US have observed the peculiarities would've happened at outcomes over the last year plus so.
This is a fight that we're continuing to buy we believe strongly in our data. We believe the voice of the Kols have been part of this and those who have read about it thus all of our.
Clinical programs have now been published so it is well known and well recognized out in the field.
To what it is that expose it can provide their patients so getting through those.
Physicians and patients who understand that and communicating that effectively to the outcome. We believe will help us be on the right side of that boat versus on the negative side and as we all know.
The agency is not required to take the advice of their own committees. So that continues to be something that we will watch closely and feel that the strength of argument will be willing to carry the day.
Makes sense. Thank you.
Again, if you have a question. Please press Star then one.
The next question is from Matt Kaplan with Ladenburg Thalmann. Please go ahead.
Hey, guys. Thanks for taking the questions.
Congrats on the AD com.
A follow up to the last question in terms of.
Assuming you have a positive result from the AD com.
What's the timing after that for.
Potential FDA action on our.
Sure.
Yes, since we don't have an active NDA in place, let me actually ask Rob blanks, our chief regulatory and quality assurance officer to address the outcomes.
Type of NDA, we could potentially exceed them.
Yeah. Thank you Mike.
Just to let you know obviously this is this AD com as a response to.
And our appeal drill N D. So what we do know is that <unk>.
30 days after we get our risks.
<unk> Com has held we will get a response from OMB.
As to the final outcome of our appeal from there we would.
Provided we prevail then we would likely have a complete response.
B, a two month review of our NDA and.
Which would mostly be label negotiations at that point.
Or the alternative is a six month review.
Yes.
Got it okay. That's very helpful. Thank you.
And then and then.
Shifting to dwell on launch.
Can you give us a sense in terms of.
The rollout of payer coverage and patient access.
Corresponding to that in terms of commercial plans and.
Medicare and Medicaid.
Land.
Marty.
How we should think about that kind of in the coming year.
Sure Susan.
Yes. Thank you Matt for the question. So so first and foremost it's really important to call out in this early launch phase.
That there is access to Israel.
For the physicians, who are willing to go through the exception process and what we're finding in these early stages because of the way the novel mechanism of the drug the way we are positioning it to focus on using this drug in patients that they believe really needs a different approach to their treatment. They are motivated to go through that exception.
Process, and we are seeing them clear through that process.
As I mentioned in my <unk>.
Narrative and as Mike had alluded to we're finding that these high writing gastro groups saw are quite linked to in many cases, the specialty pharmacies to help them with clearing these mass is exception hurdles.
Remember that the world of the Gastro neurologist Theyre involved in writing a lot of specialty products in our space is with coffee therapies ulcerative colitis Crohn's HCV. So we're finding that they have processes in place. So so this this early launch phase is really very much about creating that demand and really <unk>.
Leveraging that motivation on the part of the gastroenterology groups to work through the exceptions and get these prescriptions through as we do that we interface with parents choose to try to break down some of those hurdles and makes it easier for these physicians to tusa carriers realize that a patient that they believe really need it.
Overall, we anticipate that the access on the commercial side will probably come first.
Just in terms of starting to secure that position and this is something that we're going to work on we've seen throughout this launch start here in 2022.
Followed by Medicare and Medicaid Amazon waste the more challenging one from a timeline perspective in terms of trying to knock down some of those barriers.
Okay. Okay. Thank you and then.
In terms of pricing and gross to net.
I mean.
Comment on that.
Hey, Susan.
Yeah overall.
We have announced the price for <unk> at $500 a month.
The rationale around that pricing is linked to the clinical value proposition again.
Really a gel as unopposed in the market today for the patients who are not adequately managed there are no other option and within the range of Ibs treatment, we see it ranges from around $500 to high end of $850000 for the Ibs diarrhea products. This is this is within the range of the IV.
Yes.
<unk> landscape. So that's our price point and it's priced to a link to the value proposition and the targeted approach and our objective that we had laid out there and believe that we can achieve a high single digit share within this marketplace and in terms of the.
The cost side of it as I mentioned, we will not be rebating to match, our positions of Linzess and Sheila as you know the way. This market has caused its established those products are locked in.
Some plants preferred linzess, some drive preference to chew and we're not competing with that because we are where we are focusing on the patients who are in need of a different approach and physicians are motivated to work through those exceptions. So.
From a cemetery gross to net standpoint, we're not going to be heavily rebating. The product. So we will be working with payers to try to minimize those hurdles and yeah and then beyond that it's really just our distribution network and then we need to contemplate as well it's important to consider the affordability side of the access equation and for commercial payers.
Since we will have our.
Our commercial co pay program to be able to offset their out of pocket expense for their Israel a script.
Those are the key considerations.
Okay. Thank you for that detail.
Thanks for the question.
Thanks, Matt.
This concludes our question and answer session I would now like to turn the conference back over to Mike Raab for any closing remarks.
Thank you all for joining our call and staying abreast of our transformational progress as we launches relative patients with Ibs C and continue to navigate the regulatory process would expose them. We look forward to keeping you apprised of our progress in the coming months.
You may now end the call.
The conference has now concluded thank you for attending today's presentation.