Q4 2022 Aurinia Pharmaceuticals Inc Earnings Call

Speaker 2: Greetings and welcome to the Rene of Pharmaceuticals Inc. fourth quarter and 2022 earnings call. At this time, all participants are on the listen-only mode. A question and answer session will follow the formal presentation. If anyone should require operator assistance during the conference, please press star zero on your telephone keypad. As a reminder, this conference is being recorded.

Speaker 2: I would now like to turn the conference over to your host, Jamie Harrell, in Vegetable Relations for Iranian Pharmaceuticals. Thank you. You may begin.

Speaker 3: Thank you, operator, and thank you all for joining today's call and webcast to discuss Arrhenius' fourth quarter and full year 2022 financial and operational results. Joining me this morning are Peter Greenleaf, chief executive officer, and Joe Miller, chief financial officer. Peter Greenleaf, chief financial officer, and Joe Miller, chief financial officer, and

Speaker 3: This morning, Arrhenia issued a press release announcing its final audited financial results for the fourth quarter and full year ending December 31st, 2022, as well as its recent operational highlights. In addition, the company filed its annual financial statements on Form 10-K . For more information, please refer to Arrhenia's filings with the U.S. Securities and Exchange Commission.

Speaker 3: factors that could affect Arrhenius' future financial results in businesses, please refer to the disclosures in Arrhenius' press release and its annual financial statements on Form 10-K along with all the recent filings with the U.S. Securities and Exchange Commission and Canadian security authorities. Please note that all statements made during today's call are as current.

Speaker 3: Peter Greenleaf. Peter?

Speaker 4: First, thank you all for joining us on the call today. As you may have noticed, we issued preliminary un-audited fourth quarter of year-end numbers in early January . So on this call today, we're going to provide you with the final audited results for the fourth quarter in year-end 2022. In addition to the quarterly and year-end financials, we'll provide you with an update to our

Speaker 4: to this overview, I'll then turn the call over to Joe Miller to provide additional details on the financial results. So let's get started with our 2022 business performance.

Speaker 4: For the full year, Orini achieved $134 million in total net revenue, which represented a 194% increase over 2021.

Speaker 4: We achieved $103.5 million in net product revenue, representing 120% increase over the previous period.

Speaker 4: For the fourth quarter 2022, we achieved a $28.4 million in total net revenue and a $28.3 million in net product revenue, representing a 21% increase over the fourth quarter.

Speaker 4: Moving to more detail behind our financial results. During the fourth quarter, Arrini added 406 patient start forms or PSS. This represented a 9% increase over the 374 patient start forms that we added in the third quarter of this year.

Speaker 4: For the full year, we added a total of 1,648 PSS.

Speaker 4: And it's important to note that the growth in PSFs was significant in the months of November in December . This momentum was achieved during the months with shorter weeks due to holidays, and we believe shows how the work we initiated in the third quarter is starting to pay off.

Speaker 4: We also monitor our conversion rates from patient start forms to patients on therapy as well.

Speaker 4: the amount of time that it takes to ship drugs to patients.

Speaker 4: I'm pleased to report that we continue to improve our PSF conversion to patients on therapy, reflecting more than 85% of PSFs being converted to shipped on drug. We are now also improving the time it takes to get patients on therapy.

Speaker 4: In the fourth quarter we increased our processing speed at all time periods, 30, 60, and 90 days, with approximately 60% of our patients getting on therapy in 20 days or less.

Speaker 4: I want to note that this is meaningful improvement over the first 18 months of the launch.

Speaker 4: Our 12 month persistency remains at approximately 50%. But when we look out past one year to 15 months, we're encouraged to see almost 45% of patients remaining on therapy.

Speaker 4: Consistent with prior periods adherence to treatment regimen remains strong at approximately 80% at year end.

Speaker 4: Exiting 2022, a total of 1,525 patients were on therapy.

Speaker 4: on therapy in the last quarter was driven predominantly by improvements in new PSFs conversion rates and processing speeds.

Speaker 4: Our net realizable revenue per patient for loop kindness remains higher than our initial guidance of 65,000 per patient per year. But as we discuss previously, we expect to approach this figure on an annualized basis basis as more patients go on and stay on therapy over time.

Speaker 4: and as persistency, dosing and pair mix evolve.

Speaker 4: Every quarter since the initial launch, this number is range closer and closer to our annualized estimate.

Speaker 4: As we've said in the past, the biggest driver of this estimate is go suggesting in persistency.

Speaker 4: and I underscore not significant pay or access discounts driving margin erosion. Moving to the tactical actions that we initiated in the third quarter, we launched a new marketing campaign to healthcare professionals, emphasizing improved clinical outcomes with lukinus when compared to the historical standard of care.

Speaker 4: More specifically, we are educating physicians on the efficacy of lupkinus. It's more complete response rates, including speed and durability, as well as the ability to rapidly reduce steroids.

Speaker 4: And lastly, we're emphasizing loop kinases efficacy in minority patient populations.

Speaker 4: which represent the majority of SLE and Lupus nephritis patients.

Speaker 4: Our customer facing teams in the field are focused on clinical differentiation and delivering the Loucinas clinical story toward targeted, the highest targeted potential writers.

Speaker 4: Our activity against these targets has steadily increased throughout the quarter and into the new year. In addition, in the back half of the year, we increased initiatives focused on patient education and building awareness.

Speaker 4: In Q3, we launched a new consumer campaign focused on both disease awareness and patient activation. With the goal being to motivate the patient to seek your analysis,

Speaker 4: and treatment, and of course, one doing so, reinforcing the benefits of treatment with lupinus. There's room for importance screening for protonuria during SLE patient visits.

Speaker 4: 150,000 SLE patients.

Speaker 4: Revealed that approximately 50% did not receive urine screening for lupus nephritis.

Speaker 4: The guidelines across multiple bodies drive urine screening at every visit as a treatment goal. If every SLE patient receives a urinalysis screen during their regular visits, we would identify more lupus nephritis and do it earlier in the disease progression.

Speaker 4: This represents a big opportunity for better patient management and of course the potential for more disease diagnosis.

Speaker 4: Lastly, we identified and contracted with a nationally recognized spokesperson to further raise awareness around Lupus and the Freitas and its consequences.

Speaker 4: While we're not actually talking about the details of this partnership today, we look forward updating you more on this exciting partnership as we get closer to its launch.

Speaker 4: While much of our marketing approach is designed to increase the depth and frequency of prescribing among our existing physician base, we continuously work to ensure that all patients and prescribers have a good experience with accessing the product.

Speaker 4: Our Rene Alliance patient support team continues to make the process of product acquisition as seamless as possible for every patient and their provider.

Speaker 4: The impact of this group's work is evidenced by the increase of increased speed of starting patients on therapy, as well as improve retention and adherence rates.

Speaker 4: In the fourth quarter, our team spent significant amount of time working with patients and caregivers on their transition into 2023. Many times year-over-year insurance plan changes, policy changes, and patient copay resets can interrupt patient therapy in the first quarter of the following year.

Speaker 4: We put significant work against this to help ensure continuity of care moving into 2023.

Speaker 4: In addition to our commercial execution, it's important to note that our medical team's efforts related to loop kindness are crucial to driving education, awareness, and overall adoption.

Speaker 4: Over the past few quarters, we've generated significant visibility with health care providers, with a substantial in-person presence through one-on-one conversations with physicians in both their offices and all major medical conferences. During 2022, we've developed and presented subanalyses of data from both the Rural 1 and a Rural 2.

Speaker 4: critical part of our overall education efforts. We continue to build on the momentum we established in the fourth quarter with daily prescription trends improving quarter over quarter.

Speaker 4: As of February 24th, we have added an additional 274 PSFs, bringing our total PSFs since launch to approximately 3500.

Speaker 4: Based on everything discussed, we are reaffirming our net product revenue guidance for this year of $120 to $140 million. In 2022, we achieved significant milestones on loop kindness in the global markets.

Speaker 4: As a reminder, we partnered with Utsuka to commercialize Lube kindness in certain European countries in Japan. This collaboration agreement spans clinical, regulatory, commercial, and manufacturing all in a milestone driven, royalty-based, and cost-plus arrangement.

Speaker 4: In the fourth quarter, we received a $30 million milestone payment related to the marketing authorization for LibConnus in the European Union. Additionally, the UK's MHRA granted approval in Great Britain in November of 2023. At Suka, or has also submitted.

Speaker 4: $10 million monolstone from Atsuka.

Speaker 4: Currently we expect this milestone in late 2023.

Speaker 4: We anticipate first commercial sales in Europe during the first half of this year. Moving to Japan, our efforts to gain regulatory approval remain on track.

Speaker 4: We currently expect a PMDA submission in mid-2023. Upon approval, we would be eligible for an additional $10 million milestone payment from Atsuka and then load double-digit royalties on net sales. While we have issued press releases throughout January on this

Speaker 4: resulting in part in the termination of the interpartase review of our 036 method of use patent by the U.S. Patent Office. As a reminder, that patent has a term extending to December 2037. As we stated previously, the terms of this settlement remain confidential.

Speaker 4: Though, as we've noted, both parties agreed to dismiss their claims and counterclaims and cease to bringing any further action against each other.

Speaker 4: strengthening our patent position with more specific language associated with our unique dosing regimen. We would be seeking to have that patent listed in the orange book once issue.

Speaker 4: And this patent once granted would also have a term extending to December 20, 37.

Speaker 4: And then finally, we recently received a notice of intention to grant from the European patent office for a patent application with similar claims to our O36 method to use patent, which once this is granted would provide additional IP protection in the European Union.

Speaker 4: Obviously, these are important milestones in the continued development of our IP.

Speaker 4: these are important milestones in the continued development of our IP as a company.

Speaker 4: Shifting gears to the ongoing clinical work for Lupinus, it remains on track.

Speaker 4: This includes the advancement of both the vocal pediatric study and the in-light LN registry. With the registry, we now have 44 activated sites with 45 patients enrolled. Our plan is to leverage real-world data collected from this study to gain further knowledge about patients taking loop kindness and to help clinicians and payers.

Speaker 4: improve the overall patient care, patient suffering from Lupus nephritis. Throughout 2023, we look forward updating you on the progress of our research pipeline.

Speaker 4: As of now, we continue to advance the IND enabling work for both a UR200 and a UR300. Our aim is to submit an IND for a UR200 by the end of 2023 and an IND for a UR300 in 2024.

Speaker 4: We ended 2022 with a strong balance sheet, and we intend to continue to prioritize and focus our investments towards commercialization with the growth of loop kindness being our primary priority and of course the development of our emerging pipeline.

Speaker 4: So with all of that, let me now turn the call over to Joe Miller for a more detailed review of our financial results. And then I'll return at the end of the call for a quick recap and to open up the line for any questions you might have.

Speaker 4: call over to Joe Miller for a more detailed review of our financial results. And then I'll return to the end of the call for a quick recap and to open up the line for any questions you might have. Joe?

Speaker 5: Thank you, Peter, and good morning, everyone. At December 31, 2022, we had cash, cash equivalents, restricted cash investments of $389.4 million compared to 466.1 million in the prior year.

Speaker 5: The decrease in cash, cash equivalents for stick to cash and investments is primarily related to the continued investment in commercialization activities, advancement of our pipeline, and a payment for the achievement of a one-time milestone partially offset by an increase in cash receipts from loop salivook kindness and the milestone payment received from Utsuka in 2022 related to the EC marketing authorization. We believe that we have sufficient financial resources to fund our current operations, which include funding commercial activities.

Speaker 5: including FDA-related post-approval commitments, manufacturing and packaging of commercial drug supply, funding our supporting commercial infrastructure, advancing our research and development programs, and funding our working capital obligations for at least the next few years. Now let's take a few minutes and go into detail regarding our financial results for the quarter and year end of December 31, 2022. Total net revenue increased 21% to 28.4 million for the fourth quarter compared to the prior year period. Total net revenue for the year increased 194% to 134 million compared to the prior year period.

Speaker 5: the full year periods were 245.5 million and 226.3 million respectively.

Speaker 5: Now let me give you a further breakdown of op-backs, drivers and fluctuations. Costs of sales were 1.4 million and 481 thousand for the fourth quarters of 2022 and 2021 respectively. Costs of sales were 5.7 million and 1.1 million for the full year periods.

Speaker 5: The increase for both periods was primarily due to an increase in product-related revenue, changes in patient mix coupled with an increase in inventory reserves related to process validation batches used for FDA approval.

Speaker 5: Gross margin for the fourth quarter of 2022 and 2021 was approximately 95% and 98% respectively.

Speaker 5: Gross margin for the full year periods was approximately 96% and 98% respectively. Selling general and administrative expenses inclusive of share-based compensation were $4.47.5 million and $44.8 million for the fourth quarters of 2022 and 2021.

Speaker 5: For the full year periods, SGNA expenses inclusive of share-based compensation were $196.4 million and $173.5 million.

Speaker 5: The primary drivers for the increase for both periods were increased professional fees and services, mainly related to corporate legal matters and pharmacovigilance, and increase in travel costs in a COVID-19 pandemic environment, as well as an increased participation in trade shows, medical conferences, and sponsorship to support the commercialization of look kindness.

Additionally, salaries and incentive paying employee benefits increased due to employee promotions and inflationary impacts. Non-CASH S-T-N-A share-based compensation was $7 million and $7.2 million for the fourth quarter of 2022 and 2021 respectively. For the full year period, non-CASH S-T-N-A share-based compensation expense.

was 28.4 million and 26.4 million respectively. Research and development expenses inclusive of share-based compensation were 9.9 million and 11.1 million for the fourth quarters of 2022 and 2021. For the full year periods R&D expenses inclusive of share-based compensation expense were 45 million and 51.1 million respectively. The primary drivers for the decrease was a 10 million dollar license amount.

and 2021 non-cash air base to compensation expenses with 3.3 million and 4.4 million respectively.

The interest income was 2.9 million for the fourth quarter ended to 7.31-2022 versus 109,000 for the prior period. For the full year, interest income was 5.1 million compared to 529,000 for the prior period. The increase was mainly due to higher yields on our investment, a result of increasing interest rates. For the fourth quarter of 2022, Aurelia recorded a net loss of 26 million or 18 cents net loss per common share compared to a net loss of 30 cents.

Thanks, Joe. As you're throughout the call, we remain encouraged by the progress we're making and remain optimistic about the overall opportunity for loop kindness. We saw a positive impact from our efforts in the fourth quarter and that momentum continues into the first quarter of 2023. We remain focused on delivering loop kindness to patients in need.

and driving results in the U.S. and globally. We look forward to keeping you updated along the way. I want to thank everybody for joining us today. We'll now open up the call for questions. Operator? Thank you. And at this time, we will be conducting a question and answer session.

If you would like to ask a question, please first star one or your telephone keypad. A confirmation tone will indicate your lies in the question queue. You may press star two if you would like to remove your question from the queue. The participants using speaker equipment may be necessary to pick up your handset before a person does star keys. We also ask that each participant.

Please limit themselves to only one question and one follow-up question. One moment please, Robbie, pull for questions. And our first question comes from the line of, Mori Rule, Ray Cross with Jeffries, beautiful seat with your question.

Hi, good morning and thanks for taking my questions. You got higher, I think it was 274 patient start forms in the first two months of 2022 or a this year versus 201 patient start forms in the similar period last year. And in March, I think you got a lot more PSFs to end up with 461 for the quarter for last year. Do you expect March 2023 to be similar to March 2022?

and maybe talk a little bit more about the cadence of PSS for this year and how you expect that to play out. Well, hey, thanks for the call, Mori. If you look at PSF progress through the first quarter, and I think as everybody knows, we report total PSF towards the end of each Q and report that, but then we report where we are with PSF as a leading indicator all the way through the most updated date we can leading into the quarterly call, which on this call is February 24th. A couple things.

If you just back calculate the 274 to a number of prescriptions per week and per day, you can see that we're seeing more in the first quarter than we saw even in the fourth quarter. And I think that's building off the trend of both November and December growth that we saw and the actions that we put in place during Q3 to drive that. If you look at the month of March for 2023, there's just under five weeks.

So we've got, you know, call it five weeks or so of reporting left. And if you calculate just the average number per week we've seen year to date, you know, you should get at or around or above that number that you just recently mentioned, Mori. I listen, we hope to see, you know, this type of progress that we saw last year, which, as you just recounted, there's our balance.

wouldn't you plan to disclose more about that and can you comment generally on whether any of the terms are tied to some sales of a sec what the latter part of the question again i'm sort of tied to a confidentiality here and i know that's frustrating for people uh... uh... you know generally speaking that the latter part of your answer

and for the foreseeable future. So the positive is not only these elements in terms of the challenges we were currently having against one another move away, but also in the prospects of any future litigation. In terms of more disclosure, it kind of comes down to finalizing the

You know, the elements of our first ongoing litigation we have with them, the Pat and Fringement lawsuit, and then there is always the prospect that more comes out, but I mean, the gist of what the agreement is is already out there and as I just communicated. Got it. Okay, I'll stop there and hop back in view. Thank you very much. Thank you.

You know, the elements of our first, the ongoing litigation we have with them, the Pat infringement lawsuit, and then, you know, there is always the prospect that more comes out, but I mean, the gist of what the agreement is is already out there and as I just communicated. Got it. Okay, I'll stop there and hop back in the queue. Thank you very much. Thanks more.

Our next question comes from the line of Olivia Breyer with Canada for Zero. Please proceed with your question. Hey, good morning and thank you for the question. I want to ask about the pay or change over headwinds this quarter. And whether you're seeing any positive impact to start the year from the insurance verification efforts you've been focusing on, and then it looks like United Changes are pre-authed rules in September . And I think that went into effect in December . So can you give us any color on whether that's helped with getting patients on therapy so far this year and whether you have a sense of other insurance providers may do the same? Well, I think it's a good question. Thanks, thanks Olivia. First off, all I can say is the efforts we put into...

Q4, as it pertains to verifying, helping patients to verify, ensuring patients are ready for the year-over-year changes, we're hopeful that those will have impact. I think a couple things that we have reported that should point to that and sort of lead into your second question.

First, our PSF rates are looking good entering the year. I think that's encouraging. In terms of our speed to getting patients on therapy, look really strong as well. I think that is part of managing a better process, but alongside of it is also a part of some of the payer policy changes we're starting to see.

As we've said through the start of the original launch of this product, the more patients we get on drug, the more velocity of patients that we can put through the system, the more we believe and you can witness this for other drug launches, not just ours, that payer policies will start to come in line with where...

physicians and payers believe the drug should be utilized. And I think if you look at our 60, I believe it's 60% of our patients now are getting drug within the first 20 days now. So I think that's a direct reflection of the work that we're doing in a Rineo Alliance reflected in the third, fourth quarter, but over time. And of course, payer policies come in and line over time.

Okay, great. Thanks, Peter. And then maybe just a follow up to that. Do you expect other insurers to actually do the same as United any insight into when that could potentially play out this year? Well, I think we walked a delicate balance of trying to let the clinical adoption process and patient volume. Okay.

be the biggest driver of how and of course educating payers but those being the two biggest push factors against getting payer policies to change versus going in and just offering margin and discount to try to you know ease access. I think we're striking the right balance and I think over time the best way to measure that for everyone listening today is going to be you know percentage of patients that we convert and then second to that how fast we convert them. And I think all of those have been have been improving for the last you know 18 months.

and we'll continue to see improvement, and I think if you bench Mark and versus other drug launches out there, we're actually doing better than most. Okay, great, the top full. Thanks.

improvement and I think if you bench Mark and versus other drug launches out there, we're actually doing better than most. Okay, great that's helpful. Thanks. Thanks, Lothia.

Our next question comes from the line of STACE2 with Towing. Please will see if we have your questions. Hi, thanks so much for taking our questions. So we have a few. I follow first for Q1. So given all the improvements, you've stated for conversion rates and timing to pay drug. How should we think about the high deductible resets for Q1? You've stated that there's 1,525 patients exiting Q4.

what might be the expected patient base from Q4 going into Q1? And to just follow up on the question, how should we think about this seasonality and patients start form additions as we think about the year? For instance, as we consider summer or winter holidays, thank you so much.

The first question is, you know, I don't mean to punt on that, but, you know, we're currently in the quarter working at there certain things that we provide within the quarter, but that's when we continue to work through and rather wait till the end of the quarter to give you a realistic, a realistic accounting of how we actually did.

I can tell you very qualitatively we feel real good about the work that we did in the fourth quarter in terms of year-over-year progress where we were last year, January , doing this versus where we are this January . And I think our learnings from last year were applied.

So we think positively about the progress we made in carrying patients from the fourth quarter into the new year based upon all that disruption we typically seen. But in terms of a real sort of quantitative number, we're going to have to wait till the first quarter before we report that. Second, so take away, we feel good, but waiting for the first quarter roll up and to give

and trying to figure out. I think in the first year there were, there was a lot of COVID noise as we entered the summertime. You know, we had a spike in one of the variants right before the summer. And I think as we saw it, it was another lockdown period that in the first year of the launch drove a lot of the COVID.

summertime slowdown. Well, we didn't have that last year, but we saw sort of this seasonal dip in the summertime that as we looked at it, we could track it back to diagnosis, we could track it back to patient visits, we could track it back to our individual rep activity, all the way through the entire chain of how a patient gets diagnosed, treated, and then kept on therapy, we saw less activity.

Our hope would be that this year we sort of washed out that post-COVID, you know Everybody sort of running off on vacation people spending more time during the summertime Making up for lost time and vacations and we see more continuity in the business as we as we as we push through the summer But I think it remains to be seen I would say

feel very comfortable that in terms of tactics in our approach to the summer months that we are putting an incredibly intense amount of time and work against ensuring that we get continuity of care of patients and that we continue to drive, you know, prescription starformer patients starform growth throughout the summer months. So to be determined, we're watching it closely.

Thank you.

Our next question comes from the line of Ed. Ars with HC Wainwright. Please proceed with your question.

Hi guys, thanks for taking my questions and congrats on the continued progress on the launch. For me, I just wanted to ask a couple questions first on the PFS.

As you mentioned, growth in November and December really started to separate from prior months and it's gotten stronger so far this year. Just wondering, I know that you've touched upon this in some of your comments, but I was not. I was wondering if you could sort of explicitly list.

What's really behind that? What are the drivers? What things have you changed recently in terms of learnings over the last few months? And then sort of the same in terms of retaining patients, you know, PFS, getting a new patient and basically the same question in terms of retaining patients longer term. As you mentioned nearly a half are on treatment still at 12 or 15 months.

Thanks so much. Thanks Ed. So Ed starting point was the point that we made about the growth we saw in November and December and I think you have to look back to what we reported in October when we reported 3Q that led you to the growth in November and December was quite different than what we saw as we entered into the month of October . So why, right? And then on the back end of that why are we seeing um...

strong retention and actually good improvement in speed to transition from PSF to start. A lot of this is going to be a tactical answer, Ed, but I think therein lies what I think the impact has been up to this point. I think we have with our field sales organization, and I'll develop into that our appropriate medical efforts and education.

not just setting direction, but also tracking call activity and impact against those targets. So targeting highest deciles and intense focus against those now. Second, really digging into our data and going back and not looking just at who our repeat prescribers are, but looking at a host of physicians who've tried the product.

who've tried the drug, revisit and get them to move from trial to more broad-based adoption. I think those activities have made a difference. I also think that...

You know, our work around the conferences, we had ACR and other conferences that moved to live versus in the past have been more virtual. And lastly, I think, you know, the access is just improving. I can't give you an actual statistic on this, but, you know, centers that were very locked down are starting to open up and no see physicians in terms of...

maybe major medical centers or physicians who had policies that were adopted in COVID are starting to open up more. So I think our access to some of these targets has improved. That's some of the mix. I could also put in there our new campaign, the work I think we're doing around patient work that's driving more patients into offices and hopefully retaining more patients. I think the whole tactical mix is having a difference. And then the retention front, I think it's twofold. One is very intense.

increase on the amount of work we're doing on patient education, retention, diagnosis, across the board we've really amped up our strategy there and our activity as a result. And then second, our Arrhenia Alliance folks have been intently focusing on not just the base of patients that we have in PSFs that have not converted, but put more FTE support and more tactical support against ensuring that we stay in regular contact with patients.

even putting new initiatives in place like text campaigns and things to connect with the patient on their level. So very long-winded answer, but it gives you an idea of some of the tactical work that we've been doing to try to drive these results. And we think so far. We see the impact of it. We hope to see even more moving forward. That's great. That's very helpful. One follow-up then for me, as you mentioned, you expect initial sales out of the EU sometime in the first half of this year. Do you have perhaps even just qualitatively any sense for guidance or not?

specific guidance, but just any sort of sense for the magnitude of sales at least this year for what we could expect out of those perhaps.

3 out of 5 EU countries. So we've tried to be relatively conservative here, Ed, and it's not because we don't have a lot of passion and believe that the XUS markets can contribute. One, I think we have to look at analog products out there, and if we just look at, and this data may be slightly dated, but I think directionally accurate.

Our comparator, Ben Musta, has historically seen somewhere between 10 and 15% of their sales come from XUS markets. So, you know, we've always said that we believe the greatest impact that we can have financially, not from a patient base, but financially is going to be in the U.S. market. Hard to really give a quantitative answer to that, so I would say qualitative.

until we have pricing and reimbursement in a few large countries, it's just hard to know. But going back to what I said earlier, if you use a global benchmark over time, I think some of these analog products might be helpful. So what we have to see is we see what pricing and reimbursement looks like in these countries, and I would...

All right, next question comes from the line of Joseph Swartz with SVP Securities. Please proceed with your question. All right, thanks so much. It's great to see such a strong improvement in the trajectory as a result of some real fundamental tailwinds. So I guess my question is, can you quantify for us in any manner how much more room there is for this acceleration?

how much more room for growth this supports, just because you were growing initially quite well and then saw a disseleration and patient star forms last year, and I'm just wondering how durable this.

acceleration is and whether or not it might also win at some point. Well thanks, Joe. I actually think that's a great question. You know, the first, to try to quantify the opportunity, I think we put data in this in this call from an Optum study a couple years back to chose that...

previous calls we've talked about this element of market development like this this lupus nephritis area has a lot of room to grow in terms of not just new drugs coming into the market but how patients are assessed diagnosed and treated right if 50% of SLE patients only 50% right now over a very large sample are getting

pain and even getting more aggressive about how important that is are going to be helpful there. So hard to say like what our expectations could be of what the top end could be, but I think it's sizable. If you know 100% of those patients.

30 or 40 percent actually of problems in terms of protein urea just by getting more of them screened is going to put more patients in the front end of the bucket. Optimization of our business in terms of getting patients on drug faster, working the queue of the PSFs we have will continue to see opportunity there but eventually you're going to hit a point of.

Hey, you got a really well-run machine here. And it's all going to be about how many patients you're putting into the queue. I think we've got to put up a couple quarters to show you that we can consistently grow it. And I think my eye goes to the opportunity here is big, because we don't even have a market where patients are being screened the right way. But it's going to take time. And the best way to look at it is to see some quarter on quarter results. That's the best I can tell you. We actually have to prove that we can grow quarters. And the data that's outside of a renial like this Optum Studies show that these patients are there.

And if Federer diagnosed gives us a greater opportunity to find them and get them more aggressively treated. Okay, that's very helpful. Thanks, Peter. And then it looks like the whack for a look kindness increased about 8% earlier this year. So how should we be thinking about the average net price and the gross to net looking forward?

gives us a greater opportunity to find them and get them more aggressively treated. Okay, that's very helpful. Thanks Peter. And then it looks like the whack for a look kind has increased about 8% earlier this year. So how should we be thinking about the average net price and the gross to net looking forward?

Joe, you want to take this one? You want me to handle it. I can take a bit. Yeah. The price increase we took towards the back half of 2022, starting to bleed into 2023. Just remember that based on payer mix and other things like that, Joe, and all of them flow through to the bottom line. So I would say if you're kind of looking at overall price increase, about half of that actually makes its way through our gross net calculations at the end of the day. Okay, and just for hopefully, one thing, Joe, on that, Joe mentioned back after the year, we took a price increase in the last month of the year. So the price increase is not realized and are really realized in our 2022 numbers. It's a 23 factor. Okay, got it. Thanks again.

I can take a bit. Yeah, the price increase we took towards the back half of 2022 starting to bleed into 2023. Just remember that based on payer mix and other things like that, Joe, and all of those in flow through to the bottom line. So I would say if you're kind of looking at overall price increase, about half of that actually makes its way through our gross net calculations at the end of the day. Okay, and just to mention one thing, Joe, Joe mentioned back after the year, we took a price increase in the last month of the year. So the price increase is not realized in our, in our, really realized in our 2022 numbers. It's a 24 23 factor. Okay, got it. Thanks again.

Next question comes from the line of Justin Kim with Oppenheimer. Please see which you are. Good morning and thanks for taking my question. Peter, the team has done a really great job giving fair guidance over the quarters. So as we think about the $120 to $140 million into this year, how should we think about the puts and takes towards achieving the low versus high end? Just because RF and the assumption kind of land closer to the higher end and just trying to understand what headwinds and tailwinds may change its trajectory. Yeah, I mean listen, I think as if I'm hearing what the company is reporting out today, I would say we've done a really strong job at working all the elements of our patients through the system and we're doing a good job of doing

that could be to the previous question if we see this seasonality thing kick up on us again in the summer months of the year or you know that was two years of anomaly based on COVID and COVID hangover. Second year once the COVID crisis sort of moved past us if those things continue to be there then that could slow down our PSF activity but to me

It's all about the number of patients we're putting in in the top end of the funnel. And if we can continue to see solid progress against that, you get to the upper end or potentially outside of our guidance range. And the first quarter is going to be the time where we're going to have to address that based upon the absolute result. OK, great, great. And maybe just a separate line of questioning. On the science-based presentation expected this year, is there any chance for seeing biopsy data out of AROR to subpopulation? Yeah, as I've noted historically, just the one caveat around the CISIP, a substudy that was done within the original ARORA study.

of a low number of patients and a low number of patients just because obviously a biopsy is an invasive procedure. So it's hard to get patients to commit to it. But you know, a sizeable enough N where we can look at another measure of impact of the drug on the disease and impact of the drug specific, more specifically on the kidney by doing, you know, a view of what's happening in the actual kidney through biopsy, staining, etc., and histologically.

Our hope would be that we can get something to you this year. So stay tuned, I guess, is what I would tell you. Thanks for taking the questions. And we have reached the end of the question and air session. And I'll now turn the call back over to the management for those remarks. Well, I think everyone's heard through the call today. I'm excited about the progress. We're seeing early in 2023. We look forward to continue to keep you updated on calls to follow. I want to thank you all for joining us today. Have a good day.

And this concludes today's conference. You made us connect you live at this time. Thank you for your participation.

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