Q1 2023 Intercept Pharmaceuticals Inc. Earnings Call

Speaker 2: Good day and thank you for standing by. Welcome to the first quarter 2023, intercept pharmaceuticals earnings call. At this time all participants are in listen only mode. After the speakers presentation there will be a question and answer session. To ask a question during the session you will need to press star 11 on your telephone.

Speaker 2: You will then hear an automated message advising you your hand is raised.

Speaker 2: To withdraw your question, press star 11 again. Please be advised that today's conference is being recorded. I would now like to hand the conference over to your speaker today, Nereg Sajarian, Executive Director of Investor Relations. Please go ahead....

Speaker 3: Good morning, and thank you for joining us on today's call to review Intercept's first quarter 2023 financial results and key business updates. We are also pleased to share an overview of our commercial launch strategy for OCA andincome.

Speaker 3: Our first quarter 2023 press release and accompanying slides are now on our website at interceptpharma.com

Speaker 3: Before we begin our discussion, I'd like to note that we will be making forward-looking statements, including statements regarding our approved product and clinical development program, certain regulatory matters, and our strategy, prospects, financial guidance, and future commercial and financial performance.

Speaker 3: Listeners are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date of this call, and we undertake no obligation to update such statements except as required by law.

Speaker 3: These forward-looking statements are based on estimates and assumptions that, although believed to be reasonable, are inherently uncertain and subject to a number of risks and incentives.

Speaker 3: Some, but not necessarily all, of the risk factors that could cause our actual results to differ materially from our historical results or those anticipated or predicted by our forward-looking statements are discussed in this morning's press release and in our periodic public filings with the FCC.

Speaker 3: Today's call will begin with prepared remarks from our President and CEO , Jerry Durso, our President of Research and Development and Chief Medical Officer, Dr. Michelle Berry, Financial Officer, and Duseik.

Speaker 3: and our Chief Commercial Officer Linda Richardson. We will then open the call for questions.

Speaker 3: Please note that our prepared remarks on today's call are more in-depth than typical, but we have allotted additional time for Q&A during the call.

Speaker 3: Let me now turn the call over to our CEO , Jerry Durso.

Speaker 4: Thanks, Nurag, and good morning, everyone. Thank you for joining us on our first quarter of 2023 earnings conference call.

Speaker 4: Today we will review key business updates for the first three months of the year and preview our commercial launch strategy for OCA and Nash.

Speaker 4: The strategic actions we took in 2022 established a strong base for us to build on in 2023. As we proceed through this critical year for intercept, I'm pleased with the disciplined execution our team has taken to grow our leadership in PBC, to work through the regulatory review process for OCA and NASH and prepare its potential commercial launch.

Speaker 4: and to advance our pipeline.

Speaker 4: First, I want to highlight our important upcoming milestones in NASH and then I'll discuss the sales performance of Ocalaver and our outlook in PBC.

Speaker 4: We're actively preparing for our Advisory Committee meeting on May 19th to review our new drug application for OCA as a treatment for pre-sirotic fibrosis due to NASH.

Speaker 4: Given the robust body of evidence we've gathered through our OCA Nash clinical development program, we're confident in the improved benefit risk profile of OCA and believe it has the potential to become an impactful therapy for patients in urgent need of pharmacologic intervention.

Speaker 4: as well as its monitorable and manageable safety profile with the advisory committee.

Speaker 4: At the same time, we look forward to our upcoming PDUFA target action date on June 22nd.

Speaker 4: In parallel, we're progressing our launch readiness activities, which Linda will elaborate on later in this call.

Speaker 4: Now turning to PBC, our PBC business continued to perform well in the first quarter. We recorded $68 million in net sales for O'Callivan PBC, representing 15% growth over the prior year quarter.

Speaker 4: This strong performance is evidence of the sustained growth of our foundational PVC business.

Speaker 4: Importantly, we're seeing a consistent trend in attracting new first-time Okalva writers, which is a key factor in our growth trajectory.

Speaker 4: Specifically, four out of ten total prescribers in the first quarter of 2023 were in fact first time O'Caliber writers. Looking ahead, we have strong conviction in the strength and long-term opportunity of our foundational PVC business for several reasons.

Speaker 4: First, we know that patients on Ocalava persist on therapy at a rate better than what is typically seen with many other chronic disease therapies.

Speaker 4: In fact, over 95% of our business is driven by existing patients and our refill rate continues to be strong at approximately 90%.

Speaker 4: Additionally, our market research shows that patient satisfaction on Ocalaba therapy remains high. 85% of patients report a strong intent to remain on therapy and would highly recommend Ocalaba to others living with PBC.

Speaker 4: This satisfaction rating jumps to 95% when you survey patients from Interconnect, which is our patient assistance platform. Because of these high satisfaction ratings, 65% of currently active patients on Ocalaiva have been on therapy for more than two years. Our market research also shows that published data of the impact of Ocalaiva on clinical outcomes is...

Speaker 4: strong motivator among healthcare providers when considering their intent to prescribe TVC therapies in the future. We know the primary treatment goals for managing PVCR to prevent liver transplant or death. We assess the ability of O'Calliva to meet these goals with multiple real-world analysis that were published in gastroenterology and presented last year at medical meetings. This includes six years of data through our Poison Open Label Extension.

Speaker 4: Supporting our well-established leadership position in the PVC market is strong IP protecting Ocalivate market exclusivity into the 2030s.

Speaker 4: And finally, our OCA in Vesafibrate Fixed Dose Combination Program, which we shall will discuss in a moment, further adds to our long-term leadership in this space. In summary, I'm confident the strength of a Calibre's market position and the long-term opportunity with our foundational PVC business. As evidenced by double-digit sales growth for the third consecutive quarter and clinical development progress for the OCA.

Speaker 4: as a five rate fixed dose combination. Importantly, our strong financial position gives us the optionality to drive continued growth in PVC, execute on our upcoming milestones in Nash, and develop innovative new medicines through our pipeline programs.

Speaker 5: I'll now turn the call over to Michelle. Thank you, Jerry, and good morning, everyone. As you can imagine, our organization is actively preparing for an advisory committee meeting on May 19. Our NDA for OCA is supported by a robust body of evidence, including two independent, positive 18-month intermenalities from the Pivotal Phase 3 Regenerate Study.

Speaker 5: and a pool safety database of almost 28 hundred patients with nearly 1,000 patients on study drug for four years. In these analyses, OCA has demonstrated a strong and consistent anti-fibotic effect. As we've seen in the Phase 2 Flint study, the first clinical study to show anti-fibotic benefit. Additionally, our safety database.

Speaker 5: which is the largest in the Nashville with the longest duration of patient exposure, provides the well-characterized safety and tolerability profile that supports the potential chronic administration of OGR. It's also important to remember that while there are various pathways being studied in national drug development, patients with national exhibits signs have been veered signaling in the ethics of our pathways specifically.

Speaker 5: which triggers progressive fibrosis. Therefore, addressing underlying mechanisms related to effect-dark dysfunction is one important aspect of the Avoidance Titan ?????, but newspapers are perché??weight.

Speaker 5: OK, is an anti-fibrotic, meaning it drives fibrosis improvement through direct restoration of effects are mediated signaling. It does this in three ways.

Speaker 5: decreasing fiber genesis and collagen deposition, regulating inflammation, and reducing bile acid induced cytotoxicity.

And we move toward our advisory committee meeting, we continue to believe that OCA has the potential to become an impactful therapy and the first approved therapy for this devastating disease.

Based on the additional data we have generated, we believe that the benefit risk of OCA has improved since our initial regulatory submission.

We look forward to discussing this with the Advisory Committee next month and progressing toward our June 22nd PDUFA target action date.

I'll now share more about our commitment to innovating in PBC with our fixed dose combination of OCA and Bevafibrate, the first potential fixed dose combination of an FXR agonist and a P bar agonist.

We're excited about the progress we're making.

Our Phase I study is now complete, and we expect to complete the planned interim analyses from our two ongoing Phase II studies this year.

Pharmacoconetic data, dynamic biochemical changes, and safety tolerability will service the basis for an end-of-phase two meeting with FDA.

We plan to provide an update on the timing of that meeting as well as a Phase III study once we have those data in hand.

At the upcoming easel meeting in Vienna, interim analysis results from one of the two phase-to-studies evaluating the effects of the combination of serum biomarkers and PVC will be presented. This podium presentation is one of seven abstracts and PVC and NASH accepted for the Congress.

We look forward to providing more information in the easel embarcos list. We believe that a fixed-dose combination of OCA and bezofibrate prevents an opportunity to optimize the doses of each medicine and further improve the treatment of PBC with the potential to establish best-in-class clinical benefits.

We know from many years of data in Europe that OCRA and BESA-Fibrate have synergistic mechanisms of action and have the potential to drive relevant biochemical markers to well within normal ranges, changes that have been associated with improved clinical outcomes in PBC.

In late 2022, we published data on the improved transplant-free survival, demonstrating the long-term clinical benefits of OCA and PBC. In other words, its impact on lives, not just labs. We believe that a fixed-edge combination of OCA and Bezofibrate may meaningfully improve treatment options for individuals living with PBC.

While our fixed-ish combination program advances, we also remain on track for a regulatory submission to FDA this year in support of fulfilling our post-marketing requirements for Ocala.NPBC.

This submission will include data from our post-marketing study, COBALT, with external controls, real-world evidence from the Global PBC Patient Registry, and supportive evidence from the Poise Open Label Extension.

At this point, I'll turn the call over to Andrew for a brief financial update.

Thank you, Michelle, and good morning, everyone. I encourage you to refer to our press release for a detailed summary of our financial results for the first quarter ended March 31, 2023.

I will begin by sharing some highlights for the first quarter.

First, we are pleased with our strong sales performance this quarter. Recording $68 million in net sales is compared to $59.2 million in net sales in the prior year quarter.

This represents 15% growth, which is in line with the midpoint of our annual revenue guidance provided during our last earning skull.

Selling general and administrative expenses were $57.7 million in the first quarter of 2023, compared to $37.8 million in 2022. The period-over-period increase was primarily driven by NASH commercial launch preparation as we approach our PDUFA date in June , and to a lesser extent, costs related to our ANDA litigation which was settled prior to trial.

Research and development expenses decreased to $41.7 million in the first quarter of 2023, from $47.6 million in the prior year quarter.

This decrease was primarily driven by the closeout of our Phase III reverse study and R&D cost sharing reimbursements.

Interest expense in the quarters ended March 31, 2023, and 2022, with $2.8 million and $6.7 million respectively, and is related to our convertible notes outstanding.

We reported a net loss from continuing operations of $31.9 million for the first quarter of 2023, a decrease compared to a net loss from continuing operations of $33.4 million in the first quarter of 2022.

As we mentioned last quarter, we anticipated a heavier than normal cash burn to occur in the first quarter relative to the rest of the year. We experienced the typical Revenancies in Audi and Q1 as patients were impacted by the resetting of insurance plans and Medicare coverage gaps.

Additionally, cash outflows related to accrued expenses were higher in Q1 than in a typical quarter, as can be seen by the drop of approximately $20 million in accrued liabilities in AP from year-end to the end of this quarter.

As of March 31, 2023, Intercept had cash, cash equivalents, restricted cash, and investment debt securities of $435.2 million. As previously mentioned, we plan to use $110 million to pay off the convertible notes due on July 1, 2023. In summary, we believe that our balance sheet, cash position, and foundational PBCC uses constant, long duration central cash throughout calcium hydration, high intensity

later in the year, pending potential regulatory approval for our MBA, for OCA, and pre-cerotic ayudar hustle on a three-day scholarship for one grade monthly prior trap of 2019 civil which sells due the fill of

With that, I will now turn the caller to Linda to provide more detail on our commercial launch strategy for OTA and Natch. Linda?

Thank you, Andrew. Good morning, everyone. I'm excited to provide greater insight into the opportunity we see ahead for OCA as the first potential treatment for patients who have advanced fibrosis without cirrhosis due to NASH. This is a specific subset of the overall NASH patient population at our regenerate population.

One where patients and their healthcare providers are in urgent need of a pharmacologic intervention.

The work we've been doing to prepare our strategies and plans for launch is grounded in robust market insight analytics using third-party databases, primary and secondary market research, data from publications, and feedback from multiple advisory boards.

We've included HCPs, patients, and payers in the pre-launch work that I will discuss in my upcoming remarks. In addition to our robust market research program, we also have considerable marketplace knowledge from our years of directly engaging the hepatology and gastroenterology communities through our work delivering Ocalaba in PBC.

Now, let's start by digging into this advanced fibrosis population in a little more detail in terms of both the size and the significance of this group of patients.

We are focusing on this population for several reasons, notably.

These patients are fundamentally at greater risk for mortality as their fibrosis progresses to cirrhosis.

One in five patients with advanced fibrosis progresses to cirrhosis within approximately two and a half years.

The fact that we cannot currently predict which patients are most likely to progress makes treating these at-risk patients an urgent priority.

Also, we've updated our understanding of the size of this advanced fibrosis segment, as you can see here on slide 14.

Starting near the top of the funnel on the left, the subset of adult mathlete patients who are believed to have Nash is approximately 26 million US adults.

Of this group, slightly more than 5 million are estimated to have a NASH diagnosis.

As NASH ICD-10 codes are not consistently used, we would expect that the number of formally diagnosed cases should grow over time as new treatments become available.

We then looked to evaluate how many of these NASH patients are under the care of a specialist, meaning a hepatologist or gastroenterologist.

Currently, this seems to be on the range of 2.7 million patients.

We believe that these specialists will primarily oversee the management of NASH in the advanced fibrosis without cirrhosis population and will therefore be the primary focus of our commercial efforts. Our in-depth work with these specialists has strengthened our belief in the development of the National Center for

that these patients can be readily identified using non-invasive tests. This is the group that we refer to as patients with advanced fibrosis without cirrhosis due to NASH. We now estimate this OCA target population to be approximately 700,000 patients.

This is an updated number from the roughly 500,000 figure we've previously referenced based on work done several years ago.

Over the past few years, we've seen significant increases in recognition of the importance of fibrosis as the strongest predictor of disease progression and awareness of negative outcomes in NASH.

In a retrospective study comparing NASH patients with and without fibrosis, survival among those with fibrosis was significantly reduced as their fibrosis progressed.

Our recent market research shows that HEPs and gastros clearly understand this risk of progression in their patients with advanced fibrosis.

Six out of ten respondents agreed that fibrosis reversal of one or more stages is more important than improvement of steatohepatitis. And seven in ten believed that preventing progression to cirrhosis and fibrosis reversal of greater than one stage is more important than improvement of the

are the most important treatment goals for this patient's sediment. We've been tracking physician sediment on the importance of fibrosis and the need to treat advanced fibrosis patients differently in one of our large market research studies. The most recent research confirms the following.

An increasing number of Habsome Gastros believe that advanced fibrosis patients need to be treated urgently, they require a different management approach, and reversing their fibrosis is more important than improving steatohepatitis. We see similar beliefs from patients under the care of a gastroenterologist or hepatologist.

These patients cite that they are aware of the risks of advanced fibrosis, know it must be urgently treated, and intend to speak with their physician about treatment options.

Later on in the presentation, I will show complementary data from PEARS, who also see the importance of addressing advanced fibrosis.

We note the importance of treating these advanced fibrotic patients in NASH, but how can physicians readily identify and stage them? This is where the use of non-invasive tests, or NITs, becomes a very important element of the care pathway.

We believe the availability and acceptance of these diagnostic and staging tools in NASH is a potential game changer.

Numerous practice guidelines from a variety of associations, including AASLD and the joint ACG-CLDF publication, now endorse the use of NITs as an appropriate option to liver biopsies.

liver biopsies are invasive, not without their own risk, and are often very painful for patients.

Thought leaders in the NASH space have indicated publicly that biopsies are infrequently used in office settings and are instead primarily used for screening patients in NASH clinical trials.

For levelset everyone, NITs include simple scoring tests like BIV4 or APRI, proprietary serum tests like ELF and FibroSure, and imaging done with a Fibroscan or by MRA.

To increase sensitivity and specificity, many of the guidelines suggest that a two-step system be used, starting with a simple scoring test like FibBorn, followed by imaging or a serum test, such as Viberscanner-ELF, respectively. In fact, FibBor has now been added into many electronic health records like F.

these test results.

Our market research shows that target prescribers, meaning heps and gastros, are familiar with NITs and are increasingly using these options.

Approximately four and five surveyed hepatologists, gastros and APPs indicate that they are already using at least two MITs to diagnose, diagnose Nash and confirm fibrosis stage.

A growing number of these HCPs are using Fibroscan for their imaging, and the majority feel that it is the most ideal approach to non-invasive imaging for their NASH patients.

Conversely, our analysis of the Comodo Health Database showed that only 14% of confirmed or suspected NASH patients were ever biopsied.

meaning nearly 9 in 10 or not. We believe that the growing adoption of NITs among KOLs and specialists will help drive and facilitate the identification of NASH patients with advanced fibrosis without cirrhosis, exactly those patients who need to be treated.

The inherent impracticality of using biopsies to identify and stage potential mass patients, contrast it with the growing endorsement of NITs, will be considerations for all aspects of the healthcare ecosystem as it relates to NIT.

Payer's willingness to use NITs will also be an important factor in the reimbursement and access space. Earlier in our call, Michelle spoke about the importance of the FXR pathway in NASH. To reiterate, weakened FXR signaling in NASH is a major factor in the reimbursement process.

is associated with the disruption of multiple biologic processes, which lead to the progression of liver fibrosis. OCA directly targets these fibrotic, inflammatory, and bile acid cytotoxic mechanisms.

The majority of other late stage compounds in NASH development target steatosis, or fat in the liver, which occurs in earlier phases of the NAFLD spectrum.

For example, GLP1s appear to regulate food consumption and weight. Other drugs in development address statoosis by thyroid hormones that regulate hepatic lipid metabolism. Understanding where and how ocafix into the treatment of the disease is an important foundational understanding.

of the demonstrated anti-fibrotic effect OCA produces. We previously highlighted the efficacy of okinash from our phase three regenerate trial, evidence supported not only by liver biopsy data, but also by NITs.

Using astrology, we see that OCA 25 milligrams demonstrated double the response rate of placebo and reducing lipopibrosis without worsening Nash.

Our MIT data reinforced the findings of histology data, showing similar efficacy and measurements of key biochemistries and liver stiffness associated with fibrosis. Furthermore, our byproduct effect is even more pronounced in patients who are considered more advanced at baseline, the ES3-like patients so to speak.

Importantly, we also see improvement in fibrosis in nearly 40% of patients who had baseline and month 18 liver biopsies in regeneration.

This compelling efficacy data on fibrosis reversal, the most important parameter of concern for specialists and the driver for urgency, comprise the message platform that we plan to carry forward to prescribers.

So far, I focused on the size of the target population for OCA therapy, the strong desire among specialty prescribers to urgently stop or reverse advanced fibrosis, the increasing availability of NITs to facilitate staging NASH patients, ensuring the most appropriate patients receive treatment.

The role of FXR dysregulation in NASH and how OCA as an FXR agonist addresses that to help stop and reverse fibrosis and are compelling efficacy data.

I'll now focus on how we are planning to leverage our current knowledge and resources in this space to launch effectively in the landscape.

As an organization, we have been working to understand the NASH market for years and are leveraging our deep knowledge to ensure launch readiness.

We've done extensive modeling using claims databases to confirm our target prescribers, hepatologists, gastroenterologists, and advanced practice providers. We've learned that three in four of the highest potential NASH prescribers are HEPs and GIs already in our existing PBC target list.

allowing us to easily pivot to a national launch focus while maintaining critical support for our PVC business. We have existing relationships with these offices and prescribers. Importantly, reaching this substantial percentage of identified national targets can be achieved at launch

using our current field footprint, which we view as a strength and differentiator. Of course, we will assess the decision regarding whether to add to our field courses as we progress through regulatory and market access milestones.

We've also started to prioritize these HCP targets based on our insights regarding accessibility, influence within the NASH space, familiarity with omedicolic acid through PBC prescribing, acid patient loads, and proximity to fibroscan machines.

to facilitate inclusion of a second NIT when staging NASH patients.

We understand the GASTA group affiliations and networks, and the roles that internal staff play in handling reimbursement paperwork.

We believe this gives us a significant advantage when it comes to being the potential first-to-market mover and ness.

Additionally, we are sharing research results that show our reps are highly regarded in gas throw and hemp offices, and our corporate reputation is equally strong in the Nashville.

We believe that it is not just the educational messages that we will deliver regarding Open Nash, but who is delivering that information. We are already underway with pre-launch activities to prepare the market as slide 22 highlights.

We are engaging with key audiences at major congresses using peer-to-peer dinner programs to educate HCPs of Nash, and our disease awareness website is up and running as well. We are already training our reps to deliver Nash education in the field, which we plan to start in May.

Our medical affairs teams are also engaging in appropriate educational efforts. Now I'd like to discuss what we are hearing from our payer communities as access and reimbursement are critical drivers of launch success.

First, I can share that we plan to expand our field reimbursement manager team to help facilitate reimbursement processes at launch. We are committed to providing assistance on this front, including the use of a hub for additional patient support.

As this slide highlights, payers share many of the same sentiments that HEPs and GIs stated regarding the significance of treating patients with advanced fibrosis and a willingness to use MITs, especially if they are supported by KOLs and guidelines.

There is an overarching recognition of the unmet need and nash, and an acknowledgement that different pathways and corresponding therapeutics may be needed.

We see all of these as positive indicators for productive reimbursement conversations, following a potential approval, and access to a final label. In our discussions, we are focused on the advanced fibrosis without cirrhosis segment of NASH patients. We believe this focus helps payers understand exactly the sense

We'll make a final decision about our pricing with full insight from our label, along with the most up-to-date insights from our key payers. At that time, we'll be able to provide our pricing decision.

Slide 24 depicts the range of prices within a continuum of categories. We believe that OCA falls into the chronic specialty drug segment and are assessing our pricing options within that context.

As this is a separate MDA with a 25 milligram tablet and a unique trade name and MDC code, we will have the opportunity to consider differential pricing for Mocalovin PBC, which is an orphan disease with a distinct value proposition for PBC patients.

especially as Ocalaba is the only approved second-line treatment and has demonstrated real-world evidence that shows improved transplant-free survival. Our strategy remains to have optionality and make the best decision with full insight in hand. Imposing.

We are excited about the opportunity to potentially bring OPA to market as the first treatment for NASH in the patient segment that most urgently needs it. The approximately 700,000 patients with advanced fibrosis without cirrhosis due to NASH who are under the care of a hepatologist or gastroenterologist.

The NASH landscape in 2023 shows a greater understanding of the real risks caused by advanced fibrosis.

and the endorsement and growing acceptance of NITs to diagnose and stage NASH patients. Much has changed over the past three years, including a better understanding of the safety and efficacy profile of open NASH from a regenerate trial.

I'll now turn the call back over to Jerry.

Thank you, Linda. In summary, I'm proud of the progress we've made in the first quarter of the year and believe we're in a strong financial position as we manage our upcoming milestones, including our advisory committee meeting for OCA and MASH and planning for a potential launch. I'll now open the call for questions for the team.

Thank you. As a reminder, to ask a question, please press star 11 on your telephone and wait for your name to be announced. To withdraw your question, press star 11 again. Please limit yourself to one question. Please stand by while we compile the Q&A roster. separating

Our first question comes from Yasmin Rahimi with Piper Sandler. Your line is open. Does a three daymoar survey for Given's height isolation, family and care data. Moving on let's give my

Yes, me please check your mute button. Oh, I am so sorry. Thank you so much for allowing me to ask my question and congrats on the great updates that you provided for us this morning. Thank you so much for providing us with for us this morning.

You noted that the pair discussions really recognize the need of patients with advanced fibrosis. And I think the slide says, after we're in above, could you maybe help us understand how one could identify with the current available NITs, that particular patient population, and therefore, and then secondly, if you have any flexibility in pricing.

if you chose to go very specifically into F3 instead of F2, and I'll jump back into the queue. Yeah, Yasmeen, thank you very much for the question. As Linda indicated, obviously we're doing deep work with the payers as we progress here. Importantly, just for clarity, so the patient group that we outlined in is...

is clear on the slide which is available and people can pull it if they don't have access to it currently. That 700,000 we're defining as the launch target for OCA, you can describe as F3-like population. This is a group that can be found in the real world, again utilizing usually two NITs, and then the NITs.

We've done quite a bit of work using both of the published information and the cutoffs that are out there. We've also, and we'll in the future, put some of the additional analysis of our own data from Regenerate and some of the work we've done specific to the NITs. Also importantly in that algorithm.

We're also trying to make sure that we're opting out patients that might have a high probability to be patients with cirrhosis since we expect those to be outside of our indication. So the 700,000 is F3-like. Found, we think, by non-invasive, that is a little, and we did notice, it is growth from the number we put out in the past, but it's essentially a similar population.uesto. It is a Kellertvd Mass? stool scan, with Modfatested Chum Arstling or Cain Veteratism.)

As you can imagine over the last two to three years, both based on the epidemiology and the growth in NASH, as well as a greater understanding of the disease. We've seen that population grow. But it's a similar, it is F3, and that's when we talk with payers currently about our value proposition. We're focusing on this group.

The fact that it is a subset of our potential indication is a productive place for the discussion with pairs.

Thank you so much, Jerry, and best of luck as you're headed into the outcome.

of block as you're headed into the outcome. Thank you.

One moment for our next question. It comes from Mayank Memptani with B Riley. Your line is open. Okay.

Good, good morning team. Thanks for taking our questions and congratulations also on the progress. So on the OCA, there's a combination of a planned inter-analysis that easel. We'd love to hear what specific efficacy and points that...

Real quickly first question I have is I know, it's a little early.

For the software we requirement for the update us on number just wondering how they sent you the briefing documents yet and then on the upcoming opioid above a library combo results. Maybe you can just give us some insight into what you may ask <unk> to meet in terms of British sport regional halfway to request I know that the hope would be that before would have a role in treating the underlying.

Susan ultimately, leaving for production from longterm literally that outcomes, but I also know that some people are data has indicated reductions and write us a waste of bandwidth.

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Would you be thinking about the registration will have a rude potentially through sort of clinical symptom reduction on provided us or do you see this was another biomarker.

Alright.

So Brian on the first one we do not have the briefing book from the agency as you said it is.

Early according to the to the normal timetable shall can you.

Answer the question on the F D C police.

Yeah, absolutely. So the end 0.3 suspect will still be at.

The important lenses out about.

Biochemical changes that have been correlated with longterm outcomes. The pathway currently is accelerated.

Accelerated approval on that basis with a longer term outcomes follow up for confirmation as though it certainly is important to look at the ability for individuals to remain on drug and we think overall symptom improvements would be really.

Really critical or that we're looking forward to sharing the data <unk> and a lot more conversations to come in the second half of this year.

Okay. Thank you.

Thanks, Brian .

Our next question comes from Thomas Smith, with SV Bealer Securities.

Securities Your line is open.

Good morning, Thanks for taking the questions just.

On the National regulatory from I was wondering if you could clarify whether there's been any kind of mid cycle review meeting at this point and.

Whether there's been any requests from the agency for data from the phase III reverse trial, either safety or efficacy.

Michelle.

Sure we have been in in communications with the agency since the submission.

And I can't really comment on the the topics there.

But a lot of clarifications on data that were submitted with the with the package.

December 22nd.

And then on with regard to reverse so that study wise under a separate IMD and we did have top line, but had not completed all of our analyses sorry for those two reasons. We've not we didn't included in the.

And the NDA or regenerate.

However, I think it is important that we didn't see differential safety in that patient population with cirrhosis.

Even though we didn't hit the primary regulatory endpoint, you'll certainly be somewhere analyses that are.

<unk> coming for that patient population, but we.

We are excluding patients with with cirrhosis and are are proposed.

Population is linked to walk through earlier.

Okay got it. Thanks, so it's very helpful.

Thanks.

Our next question comes from John Woolman with JMP Securities. Your line is open.

Good morning, and thanks for taking my question.

You spent a fair bit of time, it's been Super helpful. Hearing about identifier creation fusing noninvasive tests, but you're also proposing a strategy for monitoring responds on drug it evokes something payers or up year focused on his longer early discussions on how to tell who is responding and what that looks like overtime.

Hi, This is Linda thanks for the question I think really what we're seeing is the use of the nineties can help in the staging but when we look at the regulatory requirements for approval, which were very.

Very straightforward and talking about one or the other we hit the fibrosis reversal. What we know is also clinically very meaningful is to look at.

Reversal stopping progression. So if they don't move forward. This is a great thing and clinicians eyes, and preventing getting to cirrhosis the cost the trouble the impact on the patient is such a flip over when you get to cirrhosis efficacy and regulatory standards versus real world can be a bit.

<unk> so obviously.

Can be used to monitor that as well and it will be up to payers and physicians as part of the routine monitoring over their patients to see how they're doing they'll continue to use these tests.

That's kind of how we are looking at it right now.

I think for our recommendations for on the safety side. It is really the same.

Following the same clinical standards that they are already using AD for monitoring their patients with Nash because if if someone does progressed as there are more advanced than they thought they were at that time that they started dragging may see evidence that they have had a decompensation event or biochemical changes.

That would indicate that they've progressed as cirrhosis than those patients would also just continue drug so that it's it's really more with the clinical monitoring that we would be recommending is part of our education during the launch.

That's helpful. Thank you sure.

Mmm Thanks, John .

We have a question from Merrill from UBS. Your line is open.

Hey, guys. Thanks for taking my question the address on PVC with that.

Four out of 10, prescribers, where d'you prescribers can you elaborate a little bit on that.

What you're seeing in terms of the new prescriber cross, what's driving at and how you expect us to continue going forward and just overall I'm thinking about the PVC penetration sort of where you are versus the total potential prescriber pool. Thanks.

Yeah. So so maybe I'll take a quick quick one on that and then Linda can comment if she likes.

So yes, the fact that this far into the lifecycle level Calva, we still have.

40% this quarter of the prescribers being new prescribers for the first time.

Is it really good.

Sign that our strategy to expand to a larger number of gastroenterologists as in fact, having the desired effect we.

We still see less than 40% of the potential.

Eligible patients have received caliber so again, there's still quite a bit.

To go the challenge in PVC is that the patients are spread across a very large number of these gastroenterologist. They tend to have a small number so in order to continue to source gross we have to get new prescribers and it's been good to see the cause and effect.

As intended to the plan that Linda <unk> are executing.

Mmm great. Thanks.

Thank God.

Our next question comes from Microage with Jeffries Your line is open.

Hey, guys. Good morning, Thanks for letting me ask a question I have two.

Two.

One was around your visibility on launch and.

What does your work in the field suggest around any bonus of patients show recently biopsy patients in the last 12 months that'd be ready to go.

At [noise] appreciate their needs to repair coverage, how does that visibility look for you in terms of any sort of bullets.

And the second question is related to.

Your view of how to spend go up in the base case of an approval versus what I think you said was pivoting the profitability in the case that it was not approved and maybe you could clarify a bit about that thanks.

Okay, Yeah, Thanks, Mike for the for the questions I'll take the first and then Andrew can can take the second.

So there are patients that that.

Or with the specialists to understand that they have.

Nash.

And who have been previously count salt.

Is there a risk is going up nonetheless, I think.

While that urgency is there we all the work that we do might continues to indicate that those patients will probably present. According to their normally scheduled visit pattern. So while there is a willingness to act we're not anticipating to expect.

Quote ball less.

In that upfront period, I think the other normal element is the one that you mentioned that of course that the player.

Decisions happen over time, depending on which players so.

Again, I think we're anticipating if we get approved will be ready to launch quickly will go to the most important and highest potential prescribers first.

But we don't anticipate aware housing effect like you might have seen in some other categories.

Yeah. So.

Thanks for the question with regard to the expenses.

We obviously guided the 360 to 390.

Eight year, and we're spending to that level as you can see the the spin this quarter was well within the guidance range, if you extrapolate that out.

We don't expect a big change this year.

We are holding steady and as we said before we've been very careful to manage are expensive. So we're obviously spending everything we need to to be ready right. So the loans prep is going with working with the payers. We're doing the limbus team is doing all the hard work to get us ready to launch what we haven't done as commit too and infrastructure built.

We're going to wait and see what other regulatory agency responds and if we choose to increase our footprint tore field tours.

Will lead to let everybody know at that point and will revised guidance, but at this point, we're holding where we are we feel very comfortable with our son.

What happens if we pivoted profitability. So obviously the first thing to do would be to stop the mass trials. If we don't get regulatory approval that would take a lot of our expense down right away. Obviously, then look at the organization to make sure. We're right size, but those are things that will will deal with later, if we're not able to achieve regulatory approval. We are full speed ahead with.

Our outcome and getting ready for producers and we're hopeful that we go to an approval here next quarter.

Okay that was super helpful. I appreciate that if I may ask you a quick follow up I would love to hear either Michelle Jerry to view on this which is.

I think your base case would be that there could be another oral competitor on the market by next year.

Here that two drugs on the market is a good thing Ah Ah or what is your view about that impacts the landscape and the short and medium term.

Hey, Hey, it's Linda I'm happy to take that I I think for us really because of the way. This market exists and is very in a mile wide inch deep with patients and PVC.

I think that.

Now and Nash, Yeah, Mike, Mike, maybe I'll, maybe I'll, maybe I'll jump in there.

Look I think that one of the thing.

Yeah.

Primarily for.

Are both but I'll just bet on Dash and then we can we can clearly take the PVC, but there is a.

A common factor here, which is look both PVC Nash, they're still high unmet need and I think one thing we know about chronic classes and this will I believe apply to <unk>.

It won't be satisfied by one or two or three drugs are mechanisms here and there is an effort as we have talked about a lot multiple companies have talked about a lot to educate too.

To ensure that the right information is out there to start to organize the treatment continuum in a way that gets patients.

Treated so we prepare as if we like.

The opportunity we have to potentially be the first but of course, we see a future where there's there's multiple therapies for patients and there is clearly some commonality in some of the objective of helping patients get the right treatment in terms of the right utilization of Ni, where you can imagine some some common.

Ah messages out there that would be important for the development of a large chronic class, where there's a lot of unmet need here.

Thank you.

Thanks, Mike.

Our next question comes from Brian Abram Abraham from Rbc's. Your line is open.

Hey, good morning, guys. Thanks for taking my question and I appreciate that very clear and comprehensive overview.

On the non invasive diagnostics.

Diagnostics.

Can you give us a sense as to what the comfort out there is discerning the yossi target population from an F for Frank F for patients using entities.

I guess I'm curious if you have a sense of the percent of that 700000 patients you mentioned, who have biopsy confirmed Nash at this point is it is it.

Right around that 14% that you mentioned for the full of population or do you have more specific metrics for that 700000. Thanks.

So I think for for that is probably no not that much different it's a it's a low number these patients are typically not getting.

Biopsied and then some that do get biopsy don't always get the formal ICD 10 code. So it is.

It's a low number and we know that biopsies tend to be avoided except for clinical studies or some complicated patients where they're trying to to do something else. Michelle maybe you can comment on.

Brian first question around.

The identification of those patients that might be on the upper end around.

Cirrhosis that we will be looking to identify to opt out yep yep. So what we recommended using is more of the upper bounds criteria more so than the noninvasive tests, they're really good at identifying and.

And excluding the patients who have not yet progressed to pre surrounding fibrosis, though excluding the app zero is F. One.

In and concentrating on kind of asked to an app.

You can use fiber scan through a combination in some of the wet biomarkers plus fiber scan can help delineate afterwards, but really that using god will be called upper bounds criteria looking at platelets albumin in other markers that you get the patient may have progressed.

Even prior to decompensation events.

And physicians and the data that we've looked at in particular, the screening data or a reverse study.

Are pretty good <unk> are pretty good at delineating exactly who has to reach I assume that's why it's going to be important for peace.

Patient identification at baseline, but also for monitoring patients.

Using standard clinical practice they.

They will be seen every three to six months typically for a battery of blood tests, and maybe fiber scan and that that should be sufficient for them to be monitored base for safety, but also to make sure. They haven't progressed this arises.

Got it thanks, so much.

Sure.

Thanks Bye.

One moment.

Our next question comes from J Olson with Oppenheimer. Your line is open.

Oh, great. Thank you for providing this update can.

Can you talk about the key questions that you expect to come up with the FDA Dotcom and how you plan to address them.

If I could please.

Michelle.

Yes, Sir actually discuss the issues around this year round worry about overall benefit risk so what's changed between our prior submission and.

<unk> that was submitted in December that'll be the the topic.

Advisory Committee meeting is really looking at the efficacy the confirmation of Antipyrotic benefit that we've shown with this second validated and point.

Again, showing very consistent antifibrotic benefits double <unk> <unk>.

Estimates for treatment in fact, the second element is safety.

With the initial submission there were some safety questions that couldn't be addressed with the data that had been submitted at that time the media exposure for patients with about 15 months and we didn't have any patience you and yet reached 36.

We now have pages, three and a half times more exposure. So our safety database of almost 2500 patients in the phase three study.

Three or 400 patients from the phase two studies 2800 patients.

A median of 39 months of exposure.

In patients with four years or more of exposure. So it really focusing on the overall benefit risks specifically being able to review those adjudicated a ease of special interests. So the paddock safety cardiovascular safety and Hai and we now have all of those events.

Fully adjudicated by panels of experts and have shown that there is no excess cardiovascular risks that we have a low imbalance.

And that's important in a patient population that is an increased risk for both cardiovascular and renal disease and very specific guidance Orange hepatic safety in a disease that is progressive so it will be important as we've talked about how those patients continue to be monitored.

Using that regular cadence clinical visits and noninvasive tests to make sure those patients haven't progressed to some races, which terms that drugs should be discontinued, but also looking for any short term mixed gear excursions and biochemistries that would indicate the need to have a short term.

<unk>.

For Intercurrent illness, hospitalizations things like that.

I think that'll be predominantly with with is focused on and that's what we are.

Fully prepared to address and that in just a couple of weeks.

Great. That's helpful. Thank you.

Thanks, so much for sharing your market research could you comment on any feedback on the competitive positioning associated with <unk>.

Compared to other drugs in development.

Demonstrated efficacy and both natural resolution.

Grossest improvement in how physicians my perceived overseas position in the mesh competitive landscape. Thank you.

Yeah, absolutely. So I think when we look at our strong data and the more advanced patient population that really resonates with the physicians who are it's really a nice.

Intersection of high unmet need in that particular patient population the urgency to tree and risk of progression and then our data set and the effects are pathway and what we're talking about in terms of what happens there and how our ethics are agonism addresses this very strongly and fibrosis.

Is resonating I think it's really makes sense to them and in the patient population that they are most concerned about so as we look at that.

The reception to that is a very strong and there has been historically a lot of data on fibrosis. So the mechanism ties we believe to the efficacy that we've shown there and frankly speaking we've even seen.

Control of fibrosis, and our and our locale of this study so in multiple areas. We are clearly very strongly and anti fibrotic drugs.

Great. Thank you very much for taking the questions.

Welcome Thanks, Sir.

One moment for our next question.

Our next question comes from AD or with Ht Ramate. Your line is open.

Hi, everyone. Thank you for taking my questions through for me.

Firstly I just wanted to ask.

I know you mentioned earlier on that.

We've been doing a lot of deep work with preparers and so <unk>.

Mmm those discussions if you.

Had any payers confirm that a myth only diagnosis would be sufficient to support.

Reimbursement coverage and if there is any differential there in terms of <unk>.

Restricted or unrestricted.

Coverage.

And secondly.

I know, there's a lot of different algorithms and combinations of myths out there that are used wondering if your discussions with those players there is any sort of differential preference for specific algorithm.

Perhaps.

Strongest accumulation of data that could support that thank you so much.

Thanks, Ed mainland and you can comment on the ongoing ongoing discussions which of course.

Will continue as we get more information on the regulatory front, but maybe you start with.

What we've heard or I think first of all the receptivity to the advanced fibrosis story and the use of cheese to get their versus biopsy has resounded with payers as it has with our physician treating community. What they've said is if there is a willing.

This to use <unk>, if they're endorsed by guidelines and Kols and I think we certainly showed that in my opening remarks that numerous guidelines from.

Groups that are very involved in the treatment of Nash and identification of that they have already incorporated these guidelines.

Into the guidelines the impracticality of really performing biopsies on every patient who may or may not have nash coming into the market space I think is a little bit prohibitive in and of itself they're not inexpensive.

<unk> there'll be a delay potentially and getting them et cetera et cetera. So what they want is a reasonable way to ensure that the right patients are getting on drugs and that I think is something that in this whole healthcare continuum is a line between all of the audience is so.

There we haven't heard honestly.

A preferred use or algorithm right now there are slight differences between the guidelines, which is why I think it's incumbent upon us to understand our data and look at the end of it and how that crosses over with our biopsy data to ensure that we know how to recommend the right patients for us. So we continued use deeper.

Work there.

No more to come on to pay upfront and I think we're doing that.

The important things on an ongoing basis and just to underline of course, we sometimes of these sessions talk about the payers as if they're one group and you obviously.

Our meeting and having discussions with along the way with the individual.

Who sometimes have a different perspective on one part of the or another so we'll do the deep work and continue to update appropriately as as we progressed sir.

Great. Thanks, so much.

Thanks.

One moment for our next question.

It comes from solving Richter with Goldman Sachs. Your line is open.

Hi, this is metal for solving could.

Could you sharing feedback youre doing from Doctor payers on alcohol coexist with <unk> within this target population.

And then also how are you thinking about the use of open leave and Nash patients that have morbid obesity or diabetes.

In particular do you have any feedback on.

How 'bout could be used in combination approaches with other agents like GOP ones.

Thanks.

Certainly we don't have and I'll take that last one first we really don't have outside of our own patient population, where we did have patients on SDLP choose NGL P ones on there was carry over there I can say from a practical standpoint, given that the different mechanisms of actions that are.

Working there where you see the G. L. P. One is really use for weight reduction clearing sat out of the liver.

That manner.

That is an interesting proposition paired with a an anti fibrotic agent like ourselves in terms of where they see resume and <unk>.

<unk> being used in the Nash patient population I think that there are no there's going to be patient profiles that perhaps people feel more comfortable with will.

We'll see how they go about it but for advanced fibrosis I think we're position are very very well there with the strength of our data. It is perceived to be not just about our data and efficacy that we've shown on fibrosis, but also understanding the safety profile of this drug that you use that they've had.

With a beta colic acid in this population managing side effects understanding how to use our drug.

Patient support services that we offer that's a whole package of looking at where you would use open your patience, it's not just one bit of it.

Can't really speak to haven't seen I think all of the data on <unk> safety and efficacy to this point and how that holds up but we're really focused on running are raised in understanding our patient population and where we have the greatest benefit.

Yeah.

Thanks.

Thanks Man.

One moment.

We have a follow up from <unk> from Cowan Your line is open.

Hi, guys. Thanks for taking the follow up I guess.

For for.

Michelle Uhm.

<unk> when you mentioned cost savings.

Preventing progression to survive.

How that resonates.

Data, but you can be generating from that 1004, plus year treatment experienced that you can green to the table for pay your discussion.

Even though it's.

Even though.

<unk>.

They are cost savings analysis that you can start extracting from this will have those discussions thanks.

Well, what I can tell you.

You can start and then I've got some other practical numbers to share.

Okay.

You still there.

Okay.

Yeah Yeah.

They're.

As you know we're focused on a Monday team histologic data with just focus only on an improvement in fibrosis, but one of the key things that has changed between the prior submission and the submission is the strengthening of the data that shows that fibrosis is really the only as an <expletive>.

Parameters that has been associated with improved outcomes with clinical benefit.

We now have data not just on a single measure and staging and risk of archives and liver specific mortality.

Have shown that improvements and liver stage.

That have shown improvements and those risks improved.

<unk> a progression to liver transplant in that so I think there is the strength of that data has improved we are not yet looking at our outcome data.

So we can't go into the specifics on there, but as I think windows Gonna share with you. There's a lot of data there that does show the importance of <unk>.

Process and.

And certainly fibrosis over any improvements and piano hepatitis alone without improvements in fibrosis Linda.

Yeah, I think if you let's take it at a high level first.

Estimates are that the distribution of Nash population in the U S has about 10% of patients with cirrhosis.

Those 10%.

Have a total annual predictor direct medical costs in Nash.

$8.3 billion, so once they tip over into cirrhosis, you're seeing a lot of expense dedicated to those patients versus maybe 90% of the population with $1.9 billion. So it's not inexpensive, but when you think about it in those numbers the obvious benefits of preventing the progression.

To cirrhosis, not only from a cost management side kind of perspective, but also from the health and the terrible consequences to patients both Thai and when you go back to it you can there's a two year a kind of a follow up study that was done looking at the costs related to Nash without cirrhosis Bay.

Baseline and then with cirrhosis baseline overtime and you see three times the cost difference you see cost per member per month filling up so just in terms of payer lens on what it's costing them, whether they're tracking it currently that way or not is very important and then we'll pair it with what we can get out of.

Our other trials and and doing the work, but I think that there's a recognition and that the payor community sees what's ahead. So the benefits of preventing that are are pretty strong.

Thanks.

Thanks for gifts.

Thank you and there are no other questions in the queue. This does conclude today's conference call. Thank you for participating and you may disconnect.

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