Q4 2023 Xeris Biopharma Holdings Inc Earnings Call
Emily: www.xerispharmaceuticals.com and others. Hello everyone, and welcome to the Xeris fourth quarter and full year 2023 financial results conference call and webcast. My name is Emily, and I'll be coordinating your call today. After the presentation, there will be an opportunity for you to ask any questions, which you can do by pressing start, followed by the number one on your telephone keypad. I'll now turn the call over to Allison Wey, Senior Vice President of Investor Relations. Please go ahead.
Yes.
Alright.
Hello, everyone and welcome to the <unk> fourth quarter and full year 2023 financial results Conference call and webcast. My name is Emily and I'll be coordinating Yoko, let's say after the presentation. There will be the opportunity for you to ask any questions, which you can do so by pressing star followed by the number one on your telephone keypad.
I'll now turn the call over to Allison Wey Senior Vice President of Investor Relations. Please go ahead.
Allison Wey: Thank you, Emily. Good morning and welcome to Xeris Biopharma's fourth quarter and full year 2023 financial results and conference call. This morning we issued two press releases, one on the company's financial results and the other on refinancing our debt facility with PACE and capital. Both can be found on our website.
Thank you Emily good morning, and welcome to verify a pharma fourth quarter and full year 2023 financial results and conference call.
This morning, we issued two press releases one on the company's financial results and the other on refinancing our debt facility with paper and capital while it can be found on our website. We're joined this morning by politics, Chairman and CEO and Steve Piper our CFO. After our prepared remarks, we will open the lines for questions before we begin I would like to remind you that this call will.
Allison Wey: We're joined this morning by Paul Edick, Chairman and CEO, and Steve Pieper, our CFO. After our prepared remarks, we will open the lines for questions. Before we begin, I would like to remind you that this call will contain certain forward-looking statements concerning the company's future expectations, plans, prospects, and financial performance. Such forward-looking statements are subject to risks and uncertainties that could cause actual results to differ materially from those forward-looking statements.
All contain certain forward looking statements concerning the company's future expectations plans prospects and financial performance.
Forward looking statements are subject to risks and uncertainties that could cause actual results to differ materially from those forward looking statements.
Allison Wey: For more information on such risks, please refer to our earnings press release and risk factors included in our SEC filings, including our quarterly report on Form 10-1. Any forward-looking statements on this call represent our views only as of the date of this call, and, subject to applicable law, we disclaim any obligations to update such statements. I'll now turn the call over to Paul. Thanks, Allison. Good morning, everyone, and thank you for joining us today.
For more information on such risks please refer to our earnings press release and risk factors included in our SEC filings, including our quarterly report on Form 10-Q any forward looking statements on this call represent our views only as of the date of all and subject to applicable law, we disclaim any obligations to us.
Such statements I'll now turn the call over to Paul.
Thanks, Alison good morning, everyone and thank you for joining US today, let me start by thanking everyone, who contributed in some meaningful way to us delivering an outstanding year for the company, including the patients we serve the health care providers, we enable and the dedicated service team that executes at a very high level. Every day 2023 was an exceptional year performance.
Paul R. Edick: Let me start by thanking everyone who contributed in some meaningful way to us delivering an outstanding year for the company, including the patients we serve, the health care providers we enable, and the dedicated Xeris team that executes at a very high level every day. 2023 was an exceptional year of performance and growth for Xeris, highlighted by our total revenue, which grew by an impressive 49% from 2022 to $164 million in 2023, and ending 2023 with over $72 million in cash. This revenue growth, along with Xeris' strong cash position, continues to demonstrate the sustainability of the enterprise we're building. In 2023, we significantly advanced our once-weekly subcutaneous Xerosol levofotoxin program.
Growth reserves highlighted by our by our total revenue, which grew an impressive 49% from 2000 $22 million to $164 million in 2023, and ending 2023 with over $72 million in cash.
This revenue growth along with very strong cash position continues to demonstrate the sustainability of the enterprise we're building.
In 2023, we significantly advanced our once weekly subcutaneous aerosol Levothyroxine program, we completed enrollment in our phase II clinical study and have made considerable progress on manufacturing and device development.
Paul R. Edick: We completed enrollment in our Phase II clinical study and have made considerable progress on manufacturing and device development. Even more exciting, we're starting to demonstrate the potential value of our Xeris technology. In 2023, we successfully advanced this business and generated over $10 million in total revenue. I'm going to focus the majority of my remarks on our full-year performance, and Steve will touch base on the full-year and fourth-quarter performance, so just prepare for that. Starting with our commercial business and starting with GVOKE, GVOKE had another outstanding year in 2023.
Even more exciting we are starting to demonstrate the potential value of our <unk> technology business. In 2023 was successfully advance this business and generated over $10 million in total revenue.
I'm going to focus the majority of my remarks on our full year performance and Steve will touch base on the full year and fourth quarter performance in his prepared remarks.
Starting with our commercial business and starting with <unk> <unk> had another outstanding year. In 2023, we grew revenue by 28% to $67 million. We grew G. Both prescriptions to over 215000 in 2023.
Paul R. Edick: We grew revenue by 28% to $67 million. We grew GVOKE prescriptions to over 215,000 in 2023. And GVOKE continues to outpace all other products in the category and drove 10% of the glucagon market growth in 2023. The new ready-to-use glucagon products now represent almost 80% of both new and total prescriptions, and GEVO continues to capture the market. At the end of February, G-Bulk's market share of new and total prescriptions in the retail Guggenheim market was approximately 34% and 32%, respectively. As I've said before, we see tremendous opportunity for GVOC. We estimate that approximately 15 million people with diabetes are at increased risk of severe low blood sugar. A primary risk factor for a severe low is being on insulin and siphonureas, and those who are should be carrying ready-to-use respiratory glucagons like Givo type. However, less than 10% of people at risk of a severe hypoglycemic event have a ready-to-use rescue glucon product on hand, leaving far too many people with diabetes still left without protection against a potentially life-threatening severe low-blood-sugar event.
<unk> continues to outpace all other products in the category and drove 10% glucagon market growth in 2023.
New ready to use glucagon products now represent almost 80% of both new and total prescriptions and <unk> continues to capture market share at the end of February G book market share with new and total prescriptions in the retail glucagon market or approximately 34% to 32% respectively.
As I've said before we see tremendous opportunity for <unk>, we estimate that approximately 15 million people with diabetes are at increased risk of severe low blood sugar.
Our primary risk factor for severe low is being on insulin pens to find new areas and those who are who are should be carrying a ready to use rescue glucagon like jabil type okay.
However, less than 10% of people at risk of a severe hypoglycemic event have a ready to use rescue glucagon product on hand, leaving far too many people with diabetes still left without protection against a potentially life threatening severe low blood sugar that we are just scratching the surface of this opportunity.
Paul R. Edick: We are just scratching the surface of this outbreak. The universe of health care stakeholders and advocates has declared that the addition of a ready-to-use rescue group gun, such as G-Voke, should be a key element in the standards of care for diabetes. The challenge remains getting practicing health care professionals to adopt these standards of care as their standards of practice.
The universe of health care stakeholders and advocates declared that the addition of a ready to use rescue glucagon such as Chi book should be a key element in the standards of care in diabetes. The challenge remains getting practicing health care professionals to adopt these standards of care as their standards of practice.
Paul R. Edick: As I mentioned previously, GVOC is driving the majority of market growth in this category, and we believe that GVOC will continue to be the primary and dominant voice in the market. On to recall. We're very pleased with our progress with the Core Lab, driving patient referrals and converting them to new patient starts. We see tremendous potential for record levels and increasing Cushing's dynamic market. The key difference from most other products used in the category is that Recoralev actually treats the underlying condition in Cushing's by normalizing cortisol levels in the body, which is a differentiation that resonates with customers. We grew the amount of net revenues to 29.5 million, nearly a 300% increase compared to the prior year.
As I mentioned previously <unk> is driving the majority of market growth in this category and we believe that <unk> will continue to be the primary and dominant voice in the market.
Onto recall.
We're very pleased with our progress in the core lab, driving patient referrals and converting them to new patient starts we see tremendous potential for our record of increasing dynamic cushings market.
The key difference from most other products used in the categories that require less actually treats the underlying condition in cushing by normalizing quarters out levels in the body, which is a differentiation that resonates with physicians.
We grew we grew recall of net revenues.
To $29 5 million nearly a 300% increase compared to the prior year.
Paul R. Edick: And referrals and new patient starts have outpaced our expectations each quarter in 2023. Recorlav generated $9.8 million in net revenue for the fourth quarter, an increase of 158% over the same period in 2022 and an increase of 21% over the third quarter of 2023. We're very pleased with the steady increase in referral revenue quarter over quarter. Patient referrals continue to be robust, and underlying patient demand grew 28% over the third quarter. The number of unique prescribers with new referrals also continues to grow. The average number of patients on Recorlav increased by over 145% from the same period in 2022. Our healthy pipeline of patient referrals and healthcare professionals using Ricorla as a first-line therapy are key indications that Ricorla is seen as an important option for Cushing's patients, especially given Ricorla's multi-pronged approach to suppressing cortisol production as a post-surgery treatment for Cushing's syndrome.
And referrals and new patient starts have outpaced our expectations each quarter in 2023.
<unk> generated $9 8 million in net revenue for the fourth quarter.
And an increase or an increase of 158% over the same period in 2022.
And an increase of 21% over the third quarter 2023.
We're very pleased with the steady increase in with coral of revenue quarter over quarter patient referrals continues to be robust and the underlying patient demand grew 28% over the third quarter. The number of unique prescribers with new referrals also continues to grow.
The average number of patients on requirements increased over 145% from the same period in 2022.
Our healthy pipeline of patient referrals that health care professionals using korlym as a first line therapy are key indications that recorder that is seen as an important option for cushings patients, especially given record was multi pronged approach to suppressing cortisol production as post surgery treatment for Cushing syndrome.
Paul R. Edick: Moving to GVS, we grew Covea's revenue by 15% compared to 2022, despite the launch of a generic competitor in early 2023. This performance exceeded our expectations for the brand in 2023 by delivering $56.8 million, well in excess of the $40 million revenue milestone, which triggered a CBR for strong shareholding. Steve will provide more detail on the CVR. In the fourth quarter, revenue per conveyance was $14.1 million, which is an 11% decrease from the third quarter of this year.
Moving to SaaS.
We grew the vas revenue, 15% compared to 2022.
Despite the launch of a generic competitor in early 2023.
This performance exceeded our expectations for the brand in 2023 by delivering $56 8 million well in excess of the $40 million revenue milestone was triggered a CVR for strongly to shareholders, Steve will provide more detail on the CVR.
In the fourth quarter revenue per <unk> was $14 1 million, which is an 11% decrease from the third quarter of this year. However, it was a 2% increase compared to the same period in 2022.
Paul R. Edick: However, it was a 2% increase compared to the same period in 2022. In the second half of the year, we started to see modest patient loss due to generic competition. The fourth quarter was the first quarter we saw pressure from generics impacting our net revenue. That said, even with a whole year of generic competition, we exited 2023 retaining over 90% of our patients on Cavao. This is a testament to our team's ability to find new patients and the value of our Xeris Care Connections team, which provides support for primary periodic paralysis patients and providers. As a result, patients and the medical community are willing to fight for the conveyance grant.
In the second half of the year, we started to see modest patient loss to generic competition. The fourth quarter was the first quarter. We saw pressure from the generic impacting our net revenue that said, even with a whole year of generic competition, we exited 2023, retaining over 90% of our patients onto this.
This is a testament to our team's ability to find new patients and the value of our <unk> care connections team, which provides support for periodic primary periodic paralysis patients and providers.
As a result patients and medical community are willing to fight for this brand.
Paul R. Edick: That said, we expect payer pressure will persist, and we may see sequential quarterly declines in Coveas revenue in 2024, which we've accounted for in our 2024 guidance that we'll talk about later. However, we continue to find new patients and build the top of the referral funnel, which is key to maintaining Coveas' contribution to our commercial portfolio. Before I move on to our levothyroxine program, a quick comment on the healthcare cybersecurity issue two weeks ago. We believe this has the potential to temporarily slow the adjudication of pharmaceutical prescriptions in general.
That said, we expect payer pressures will persist we may see sequential quarterly decline in <unk> revenue in 2024, which was accounted for in our 2024 guidance that we'll talk about later however, we continue to find new patients and build the top of the funnel, which is key to maintaining <unk> contribution to our commercial portfolio.
Yes.
Before I move onto our Levothyroxine program, a quick comment on the change healthcare cyber security issued two weeks ago.
We believe this has the potential to temporarily slow adjudication of pharmaceutical prescriptions in general.
The degree to which that potential for delayed adjudication may impact, our specialty pharmacy and retail business is yet unclear and really too early to tell.
Paul R. Edick: The degree to which that potential for delayed adjudication may impact our specialty pharmacy and retail business is yet unclear and really too early to tell. Now on to our Xerisol Levothyroxine Program, a potential once-weekly subcutaneous injection. The last patient's last visit was just last week, which keeps us on track for data from the Phase 2 study mid-year. This oral liquid dose conversion data will help to inform our proposal to the FDA for a Pitotinal Phase 3 program. We anticipate requesting an end of phase two meeting later this year. If we gain alignment with FDA on a phase three study program, we could start that study as early as mid-2025. Now on to our formulation technology business; we're very excited about the potential value this business can provide for patients, caregivers, healthcare professionals, and our Xeris partners.
Now onto our aerosol Levothyroxine program, a potential once weekly subcutaneous injection.
Last patient last visit was just last week, which keeps us on track for data from the phase II study mid year. This oral liquid dose conversion data will help to inform our proposal to the FDA for a pivotal phase III program.
We anticipate requesting an end of phase two meeting later this year, if we gained alignment with FDA on a phase III study program. We can start that study as early as mid 2025.
Now onto our formulation technology business, we're very excited about the potential value of this business can provide for patients caregivers healthcare professionals and others.
Partners.
We made a lot of progress validating <unk> technology in 2023 from signing the Regeneron platform deal a year ago to successfully formulating the pre prescribed target product profile for <unk> to present and as such receiving the associated $6 million success payments from Amgen.
As recently as January Amgen executed the exclusive worldwide license agreement to develop manufacture and commercialize a subcutaneous formulation of <unk>.
Paul R. Edick: We made a lot of progress in validating the Xeris technology in 2023, from signing the Regeneron platform deal a year ago to successfully formulating the pre-prescribed target product profile for Xerijectopeza, and as such, receiving the associated $6 million success payment from AMP. As recently as January, Amgen executed an exclusive worldwide license agreement to develop, manufacture, and commercialize a subcutaneous formulation of Cephasumab using our Xeritec technology in thyroid iodine.
Using our <unk> technology in thyroid eye disease under terms of the agreement <unk> has the potential to receive up to $75 million in development regulatory and sales based milestones as well as an escalating single digit royalties based on future sales of <unk> using the <unk> technology.
Next step in this program the newly integrated Amgen team has been formed around the <unk> program development work continues and planning is underway in preparation for initial clinical stage activities.
As for the Regeneron collaboration we've completed formulation development for both initial molecules regeneron stability in non clinical evaluations will take place over the next six months, assuming continued success that could lead to a potentially to their potentially executing a license option for further clinical development in <unk>.
Paul R. Edick: Under terms of the agreement, Xeris has the potential to receive up to $75 million in development, regulatory, and sales-based milestones, as well as an escalating single-digit royalty based on future sales of Topeza using the XerisTech technology. As a next step in this program, a newly integrated Amgen team has been formed around the Xerijec program, development work continues, and planning is underway in preparation As for the Regeneron collaboration, we have completed formulation development for both initial molecules. Regeneron's stability and non-clinical evaluations will take place over the next six months. Assuming continued success, that could lead to them potentially executing a license option for further clinical development and commercialization of any of the molecules in the platform, which would trigger an additional one-time payment. Regeneron also has the option to nominate additional molecules for formulation development at any time, for which we would receive an additional up-front payment per mile.
<unk> of any of the molecules in the platform, which will trigger an additional onetime payment.
Regeneron also has the option to nominate additional molecules for formulation development at anytime for which we would we would receive an additional upfront.
Per molecule.
We're excited about potential for our <unk> business and believe this could be a significant contributor.
The growth of <unk> over time, we continue to discuss additional <unk>.
<unk> collaborations with numerous companies.
And before I go into our 2024 financial guidance I want to touch on our debt refinance with Haytham capital that we announced this morning.
Since we began our relationship with <unk> two years ago, we've proven to them that we can execute on our strategy growing in Derisking. Our enterprise. This is giving them the confidence in <unk> to further support us by committing an additional $50 million at close of the transaction with another $15 million of committed capital at our discretion.
To settle the 2025 convertible notes and by providing $100 million of uncommitted capital for potential M&A purposes.
Paul R. Edick: We're excited about the potential for our xeris business and believe this could be a significant contributor to the growth of Xeris over time. We continue to discuss additional Xeris. Zero Jet Collaborations with numerous companies.
While lowering our total cost of capital overall.
<unk> got a great partner to <unk> willing to support the growth of our enterprise with non dilutive capital.
Steve will go into more details on the transaction.
Looking at 2024.
As our momentum continues we expect to grow total revenue in the range of $170 million to $200 million. Our total revenue range implies a 4% growth at the low end to 22% growth at the high end and 13% at the midpoint.
Paul R. Edick: And before I go into our 2024 financial guidance, I want to touch on our debt refinance with Hathen Capital that we announced this morning. Since we began our relationship with Hafen two years ago, we have proven to them that we can execute on our strategy, growing and de-risking our enterprise. This has given them the confidence in Xeris to further support us by committing an additional $50 million at closing the transaction with another $15 million of committed capital at our discretion to settle the 2025 convertible notes and by providing $100 million of uncommitted capital for potential M&A purposes, while lowering our total cost of capital overall. Hayford has been a great partner to Xeris, willing to support the growth of our enterprise with non-diluted capital.
However.
Net of nonrecurring partner revenue a range for 2024 represents approximately a 10% growth at the low end, 30% at the high end and 20% at the midpoint very positive potential continued growth of the enterprise either way you look at it.
Recall in 2023, we initially gave a wide revenue range as we are not sure of the latest expected decline in <unk> due to generic competition.
Revenue contribution from technology partners.
Which is an episodic.
In nature altogether same unknowns and uncontrollable exist for 2020 for.
That said this double digit revenue growth coupled with our recent debt financing and continued disciplined cash management allows us to further invest in the growth of our commercial products fund phase III readiness activities for our pipeline Levothyroxine program.
And lastly to make incremental investments in our emerging technology business.
And we still expect to end 2024, with a very healthy cash position of between 55% at $75 million further demonstrating the sustainability of the enterprise that we're building.
Paul R. Edick: Steve will go into more details on the transaction, looking at 2024. As our momentum continues, we expect to grow total revenue in a range of $170 to $200 million. Our total revenue range implies 4% growth at the low end, 22% growth at the high end, and 13% at the mid-period.
I'm now going to turn the call over to Steve for additional details on our financial performance.
Thanks, Paul and good morning, everyone. As Paul mentioned 2023 was another year of exceptional performance and growth for service all three of our commercial products grew revenue for the full year and fourth quarter compared to last year. We ended the year with net product revenue of $150.
Paul R. Edick: However, net of non-recurring partner revenue, our range for 2024 represents approximately 10% growth at the low end, 30% at the high end, and 20% at the midpoint. Very positive potential continued growth of the enterprise either way you look at it. Recall, in 2023, we initially gave a wide revenue range, as we were not sure of the rate of expected decline in caballas due to generic competition and revenue contribution from technology partners, which is episodic in nature altogether. Shame unknowns and uncontrollables exist for 2024.
$3 4, million% to 40% increase compared to last year, our various partnerships contributed meaningful revenue with a record $10 5 million of other revenue for the full year 2023.
Total revenue in 2023 was $163 9, million% to 49% increase compared to last year.
Revenue growth coupled with our disciplined cash management resulted in <unk>, ending 2023 with cash of $72 5 million and generating $6 $5 million of cash in the fourth quarter.
Paul R. Edick: That said, this double-digit revenue growth, coupled with our recent debt financing and continued disciplined cash management, allows us to further invest in the growth of our commercial products, fund Phase III readiness activities for our Pipeline Libothyroxine Program, and lastly, make incremental investments in our emerging technology business. And we still expect to end 2024 with a very healthy cash position of between $55 and $75 million, further demonstrating the sustainability of the enterprise that we're building. I'm now going to turn the call over to Steve for additional details on our financial performance. Thanks, Paul. And good morning, everyone.
This is a significant milestone for <unk> and it continues to demonstrate our ability to be self sustaining enterprise.
Moving on to our fourth quarter and full year results for the fourth quarter total revenue was $44 4 million, representing a 34% increase over the same quarter last year.
<unk> net revenue for the quarter was $18 6 million, representing a 25% increase compared to the same period last year.
Full year net revenue was $67 million, representing a 28% increase compared to last year in the fourth quarter G. Both prescriptions top 59000% to 43% increase compared to the same period last year.
Steven M. Pieper: As Paul mentioned, 2023 was another year of exceptional performance and growth for Xeris. All three of our commercial products grew revenue for the full year and fourth quarter compared to last year. We ended the year with net product revenue of $153.4 million, a 40% increase compared to last year. Our various partnerships contributed meaningful revenue with a record $10.5 million of other revenue for the full year 2023. Total revenue in 2023 was $163.9 million, a 49% increase compared to last year. Revenue growth coupled with our disciplined cash management resulted in Xeris ending 2023 with cash of $72.5 million and generating $6.5 million of cash in the fourth quarter.
<unk> with the historical trend.
Following the typical back to school Spike for the glucagon market in Q3, the total glucagon prescription market declined 7% in the fourth quarter. Despite the 7% market decline Chievo total prescriptions grew 1% in the same period ending the quarter with total retail market share of them.
Proximately, 31%.
<unk> continues to gain market share in 2024, ending February at approximately 32%.
Moving to require less <unk> net revenue was $9 8 million for the fourth quarter and $29 5 million for the full year of 2023 <unk>.
Compared to Q3 2023, net revenue increased by 21% driven by a steady increase in underlying patient demand. We are encouraged by the growth in <unk> patient demand.
Steven M. Pieper: This is a significant milestone for Xeris, and it continues to demonstrate our ability to be a self-sustaining enterprise. Moving on to our fourth quarter and full year results, total revenue for the fourth quarter was $44.4 million, representing a 34% increase over the same quarter last year. Shevoke Net revenue for the quarter was $18.6 million, representing a 25% increase compared to the same period last year.
Which has been fueled by a consistently healthy pipeline of referrals.
Moving to <unk> <unk> net revenue for the quarter was $14 1 million, representing a 2% increase compared to the same period last year.
Full year 2023, net revenue was $56 8 million, representing a 15% increase compared to last year.
Steven M. Pieper: Full-year net revenue was $67 million, representing a 28% increase compared to last year. In the fourth quarter, GBOP prescriptions topped 59,000, a 43% increase compared to the same period last year. Consistent with the historical trend following the typical back-to-school spike for the glucagon market in Q3, the total glucagon prescription market declined 7% in the fourth quarter.
While our strategy to invest in <unk> and defend brand prescribing has been successful to date in Q4, we saw a slight decrease in patient demand due to increased generic pressure, we will continue to deploy strategies to protect <unk> and will continue to invest in <unk>.
Care connections as they offer the best in class therapy and support for primary periodic paralysis patients.
Steven M. Pieper: Despite the 7% market decline, Chivo total prescriptions grew 1% in the same period, ending the quarter with total retail market share of approximately 31%. Chivo continues to gain market share in 2024, ending February at approximately 32%. Moving to RecorLib.
Before I move on to our other revenue and as I covered in my prepared remarks in November I want to again address the <unk> milestone that was achieved in 2023.
2023, <unk> net revenue was over $56 million.
Steven M. Pieper: RecorLib net revenue was $9.8 million for the fourth quarter and $29.5 million for the full year 2023. Compared to Q3 2023, net revenue increased by 21% driven by a steady increase in underlying patient demand. We are encouraged by the growth and correlation of patient demand, which has been fueled by a consistently healthy pipeline of referrals. Moving to Coveas. Covea's net revenue for the quarter was $14.1 million, representing a 2% increase compared to the same period last year.
<unk> the <unk> CVR milestone of $40 million consistent with my previous remarks, we will settle this obligation and <unk> common shares later this month and anticipate issuing approximately $7 5 million common shares which is a modest increase of approximately five.
Percent of outstanding shares.
Moving onto our other revenue in 2023, we generated $10 $5 million in other revenue. This was mainly comprised of our technology partnership business, which we significantly advanced in 2023.
Steven M. Pieper: Full year 2023 net revenue was $56.8 million, representing a 15% increase compared to last year. While our strategy to invest in Cavaeus and defend brand prescribing has been successful to date, in Q4, we saw a slight decrease in patient demand due to increased generic pressure. We will continue to deploy strategies to protect Tavares and will continue to invest in Xeris Care Connections as they offer the best-in-class therapy and support for primary periodic paralysis patients. Before I move on to our other revenue, and as I covered in my prepared remarks in November, I want to again address the Cabeza CBR milestone that was achieved in 2023. In 2023, CAVAS Net Revenue was over $56 million, exceeding the CAVAS CBR milestone of $40 million.
We will be making incremental investments in our technology business in 2024 to further advance our existing partnerships and attract new partners in 2024 and beyond these investments include accelerating GMP manufacturing readiness and clinical scale up to enable our partner.
Grams to move into clinical development.
We believe these investments are necessary to further demonstrate the full value of our technology platform.
Looking ahead to 2024, we expect to grow total revenue and are issuing full year total revenue guidance of $170 million to $200 million.
2020 for revenue will be driven by the continued growth of <unk> and the impacted by an expected decline in <unk> and the potential episodic contributions from our technology partnership business.
Steven M. Pieper: Consistent with my previous remarks, we will settle this obligation in Xeris Common Shares later this month and anticipate issuing approximately 7.5 million common shares, which is a modest increase of approximately 5% of outstanding shares. Moving on to our other revenue, in 2023, we generated $10.5 million in other revenue.
Moving down the P&L cost of goods sold in the fourth quarter was $7 6, million% to 20% increase compared to the same quarter last year for the year cost of goods sold was $28 6 million an increase of 27% compared to last year. These increases are mainly driven by higher product sales.
Research and development expenses were $6 4 million for the quarter and $22 3 million for the full year, a modest increase of 7% compared to prior year driven by our Levo phase two clinical study and an increase in personnel costs.
Steven M. Pieper: This was mainly comprised of our technology partnership business, which we significantly advanced in 2023. We will be making incremental investments in our technology business in 2024 to further advance our existing partnerships and attract new partners in 2024 and beyond. These investments include accelerating GMP, manufacturing readiness, and clinical scale-up to enable our partner programs to move into clinical development. We believe these investments are necessary to further demonstrate the full value of our technology platform.
Selling general and administrative expenses were 37 6 million for the quarter, an increase of $3 $2 million relative to the same period last year. This increase was driven by rent expenses related to the facility lease that commenced in April 2023, and personnel costs, primarily driven by a modest <unk>.
Expansion.
Compared to last quarter SG&A was relatively flat.
On a full year basis, SG&A was $146 1 million, an increase of approximately $8 million or 6% versus last year.
Steven M. Pieper: Looking ahead to 2024, we expect to grow total revenue and are issuing full year total revenue guidance of $170 to $200 million. 2024 revenue will be driven by the continued growth of Jivoke and Recorla and impacted by an expected decline in Cabeas and the potential episodic contributions from our technology partnership business. Moving down the P&L, cost of goods sold in the fourth quarter was $7.6 million, a 20% increase compared to the same quarter last year. For the year, cost of goods sold was $28.6 million, an increase of 27% compared to last year. These increases are mainly driven by higher product sales. Research and development expenses were $6.4 million for the quarter and $22.3 million for the full year, a modest increase of 7% compared to the prior year, driven by our Levo Phase II clinical study and an increase in personnel costs. Selling general and administrative expenses were $37.6 million for the quarter, an increase of $3.2 million relative to the same period last year.
Moving onto cash we ended the year with a very healthy cash position and generated positive cash for the first time in <unk> history in the fourth quarter.
As of December 31, 2023, we had total cash of $72 5 million compared to $66 million as of September 32023, generating $6 $5 million in cash in the quarter.
Cash utilization for the full year 2003 was $49 5 million a significant improvement over 2022 cash utilization of over $100 million.
Earlier today, we announced that we refinanced our senior secured term loan with hasten capital as a result, we are reducing the interest rate we pay on our loans by over 200 basis points as we move from a sofa plus 9% rate to a sofa plus 695% rate in the new agreed.
<unk>.
Additionally, we drew down an incremental $50 million at close resulting in a total facility of $200 million with the ability to draw down an additional $15 2 million to redeem our outstanding 2025 convertible notes.
Steven M. Pieper: This increase was driven by rent expenses related to the facility lease that commenced in April 2023 and personnel costs primarily driven by a modest field expansion. Compared to last quarter, SG&A was relatively flat. On a full year basis, SG&A was $146.1 million, an increase of approximately $8 million, or 6% versus last year.
The new loan is interest only with a term of five years.
We must maintain minimum cash and achieve minimum revenue targets. These covenants are in line with our previous safe an agreement. This new agreement is a testament to the confidence hasten hasnt <unk> ability to successfully execute our strategy.
Steven M. Pieper: Moving on to cash, we ended the year with a very healthy cash position and generated positive cash for the first time in Xeris' history in the fourth quarter. As of December 31, 2023, we had total cash of $72.5 million, compared to $66 million as of September 30, 2023, generating $6.5 million in cash in the quarter. Cash utilization for the full year 23 was $49.5 million, a significant improvement over 2022, when cash utilization was over $100 million. Earlier today, we announced that we refinanced our Senior Secured Term Loan with Haytham Capital.
From a cash guidance perspective, we expect 2024.
To end 2024, with a very healthy cash position of $55 million to $75 million, which includes the incremental $50 million from Haven lab.
Onetime costs, including a call premium commitment fees and other advisor and legal fees, adding a net $35 million to cash in the first quarter, we expect SG&A to be relatively flat to 2023. Furthermore, we expect R&D to increase.
By approximately $5 million relative to 2023.
Steven M. Pieper: As a result, we are reducing the interest rate we pay on our loan by over 200 basis points as we move from a SOFR plus 9% rate to a SOFR plus 6.95% rate in the new agreement. Additionally, we drew down an incremental $50 million at close, resulting in a total facility of $200 million, with the ability to draw down an additional $15.2 million to redeem our outstanding 2025 convertible notes. The new loan is interest only, with a term of five years. We must maintain minimum cash and achieve a minimum revenue target.
We make strategic investments in our own pipeline and our emerging technology partnership business.
The incremental capital from our refinance Hampton facility, coupled with the continued growth of our revenue allows us to further invest in the growth of our commercial products fund phase III readiness activities for our own pipeline Levo program, and lastly, make incremental investments in our emerging technology.
Partnership business.
To summarize <unk> had a year of exceptional performance and growth in 2023, and we look forward to continuing to build on that momentum in 2024.
Steven M. Pieper: These covenants are in line with our previous HAPEN agreement. This new agreement is a testament to the confidence Hafen has in Xeris's ability to successfully execute our strategy. From a cash guidance perspective, we expect 2024 to end 2024 with a very healthy cash position of $55 to $75 million, which includes the incremental $50 million from HAFIN, less one-time costs, including a call premium, commitment fees, and other advisor and legal fees, adding a net $35 million to cash in the first quarter. We expect SG&A to be relatively flat to 2023.
With that operator, please open the line for questions.
Thank you.
A reminder, if you would like to ask a question today. Please do so now by pressing star followed by the number one on your telephone keypad.
Have you changed your mind I would like to be remain from Mckee you can press star and then case.
Our first question today comes from Matt with H C Wainwright.
Please go ahead.
Thanks, I have a couple.
Just to get out of the way on the Amgen partnership first congrats on.
Further validation of that platform.
Steven M. Pieper: Furthermore, we expect R&D to increase by approximately $5 million relative to 2023 as we make strategic investments in our own pipeline and our emerging technology partnership business. The incremental capital from our refinanced Hathen facility, coupled with the continued growth of our revenue, allows us to further invest in the growth of our commercial products, fund Phase 3 readiness activities for our own pipeline LEVO program, and lastly, make incremental investments in our emerging technology partnership business. Summarize.
And what you had in the script is there anything you can tell us about.
Sure and expected timelines to the next important value, creating events and when we might start to get some more clarity on that program.
And.
Let's say if you are the only iron in the fire. They have now on <unk> so to speak or is it within your contract are they a lot also continuing to work with other platforms and I have a follow up thanks.
I'll take the second one first ore and good morning welcome.
Sure.
They can work on anything they want to work on.
We don't have an exclusive.
Deal.
Steven M. Pieper: Xeris had a year of exceptional performance and growth in 2023, and we look forward to continuing to build on that momentum in 2024. With that, Operator, please open the line for questions. Thank you. As a reminder, if you would like to ask a question today, please do so now by pressing star followed by the number one on your telephone keypad. If you change your mind and would like to be removed from the queue, you can press star and then. Our first question today comes from Oren Livnat with HC Ways. Please come back. Thanks; I have a couple.
They've already announced or even Hello, Simon announced that they were no longer working on their program.
They've got some internal programs.
I believe that Amgen may have internal program also so if I was in that market with multibillion dollar asset I'd have a lot of irons in the fire. We're one of those.
And with our technology I believe probably the best option that they have to extend that franchise and grow that franchise as space.
Patient self administered drug.
And the second part timing to an event.
As you can imagine the integration of the companies is just completing.
And the team around.
<unk> has been reformed and Theyre getting up to speed. The work we were doing in terms of preclinical is still ongoing.
Operator: Just to get out of the way, on the Amgen partnership, first, congratulations on... further validation of that platform. Beyond what you had in the script, is there anything you can tell us about, Make sure the expected timelines for the next, and www.kenhub.com. I'll just say, if you are the only iron in the fire they have now on Sub-Q Tepeza, so to speak, or within your contract, are they allowed to also be continuing to work with other tech platforms? And I have a follow-up question. I'll take the second one first, Oren.
And they're mapping out their development and clinical program.
So things are going along well.
With a little bit of a disruption between the horizon than that Amgen transition.
Alright. Thanks.
On levo.
You told US maybe in January that you completed enrollment in the last visit right.
Yes.
Can you give us I guess any more granularity on timing other than mid year or I guess.
Not.
But.
Certainly in the interim have you had any informal.
Paul R. Edick: Good morning. Welcome. They can work on anything they want to work on. We don't have an exclusive...
Issues with the FDA or perhaps.
More work with your consultants.
Paul R. Edick: They've already announced, or even Halozheim announced, that they were no longer working on their program. They've got some internal programs, and you know, I believe that Amgen may have an internal program also. So if I was in that market with a multibillion dollar asset, I'd have a lot of items in the fire. And with our technology, I believe it is probably the best option that they have to extend that franchise and grow that franchise as patient self-administered drugs. And the second part, timing for an event. As you can imagine, the integration of the companies is just beginning. And the team around TEPESA has been reformed, and they're getting up to speed.
As you any more color and expectations around the potential phase III.
And the requirements with regards to endpoints.
Yes. So in January we said, we had completed enrollment and we just last two weeks ago or last week, we had our last patient last visit.
It will take a few months to analyze all that data that's been collected so that's why we should have data midyear, we will as fast as we can go to the FDA for end of phase II phase III discussion.
That has its own calendar as Asian, that'll take us pretty much to the end of the year we believe.
Paul R. Edick: The work we were doing in terms of preclinical is still ongoing, and they're mapping out their development and clinical programs. So things are going along well, with a little bit of a disruption between Verizon and then Amgen. All right, thanks.
And with good alignment on what a phase III program might look like and the other part of your question. We don't know and we haven't had conversations with them about a phase III program yet.
Paul R. Edick: And on Levo... You told us, maybe in January, that you completed enrollment in the last visit, right? Can you give us, I guess, any more granularity on timing other than mid-year, or I guess we won't, but, And most importantly, in the interim, have you had any informal conversations with the FDA or perhaps more work with your consultants that give you any more color and expectations around the potential phase three? in the requirements with regard to endpoints.
Our our going in assumption is one study.
And that if we get good alignment by the end of the year. We can start that study, we're going to get going on IRB and all that kind of stuff will get that study up and running best case middle of 'twenty five.
Hi.
I think I covered the whole thing and I'll jump back in queue I appreciate it.
Thanks.
Yes.
The next question comes from Glenn <unk> with Jefferies. Please go ahead Glen.
Yes. Good morning, Thanks for taking my questions Hey, Paul just a couple of Proto questions for you and then I have a follow up for Steve.
Paul R. Edick: Yeah, so in January, we said we had completed enrollment, and we just last two weeks ago, or last week, had our last patient visit. It'll take a few months to analyze all that data that's been collected. So that's why we, you know, we should have data mid-year. And we will, as fast as we can, go to the FDA for a, you know, end of phase two, phase three discussion. That has its own calendarization that'll take us pretty much to the end of the year, we believe, and with good alignment on what a phase three program might look like. And to the other part of your question, we don't know. And we haven't had conversations with them about a phase three program yet.
First your two growth markets here when you think of <unk> <unk> is now on the vaccine me now for a couple of few quarters.
And then as it relates to Cushing Teva has recently launched a.
The generic version of Korlym, So I'm kind of curious to get your take how you see the competitive landscape in each of those markets kind of shifting and are those shifts positive for you or are they negative.
Thanks, Glenn those are.
Important questions the so <unk>.
<unk>.
We want them to be as active as possible in the marketplace. That's the only way right now like I said in my prepared remarks, there was about 10% growth in the market, where we're basically driving all of that growth. We think that amtrust are kind of picking up the ball from Lilly and really getting going with their commercial business is only going to fuel market growth.
Paul R. Edick: Our going assumption is one study and that, if we get good alignment by the end of the year, we can start that study. We can get going on IRBs and all that kind of stuff and get that study up and running. Best case scenario, middle of 2014, and Peggy Coverdell.
Paul R. Edick: I'll jump back into queue. I appreciate it. Thanks. The next question comes from Glen Santangelo with Jeffreys. Please go ahead. Yeah, good morning.
And thats good for us, we've never really even with Lilly, we werent ever really selling vaccine against <unk> or <unk> against vaccine, where both selling for the benefit of the patient. So the opportunity is so huge.
Paul R. Edick: Thanks for taking my question. Hey, Paul, just a couple of product questions for you, and then I have a follow-up for Steve. You know, first, you know, your two growth markets here, when you think of GVolk, I mean, Amphistar is now on Baximi for a couple of quarters, and then as it relates to Cushing's, you know, Tevez recently launched a generic version of Coralim, so I'm kind of curious to get your take on how you see the competitive landscape in each of those markets kind of shifting, and, you know Those are important questions.
Market growth is really what both companies should be focused on what our focus is and we're hopeful that <unk> really gets going in a more significant way.
As for Teva and the dynamic in the Cushing market.
As we know the Cushing market has been generic for a long time with several new big brands over the last decade or so.
There has always been that dynamic I think this particular situation was korlym being as big as it is that dynamic we believe.
Paul R. Edick: So, GVOC and Amphistar. We want them to be as active as possible in the marketplace. That's the only way, but right now, like I said in my prepared remarks, there's about 10% growth in the market. And we're basically driving all that growth. We think that Amphistar kind of picking up the ball from Lilly and really getting going with their commercial business is only going to fuel market growth, and that's good for us. We've never really, even with Lilly, were never really selling Baccini against GVOC or GVOC against Baccini.
We will play in our favor because.
We think we have a really good differentiation versus korlym in terms of our ability to normalized cortisol and.
Having a generic in the market is going to sort of be disruptive for that franchise.
Our estimation kind of put it in play for others like us to take share so I see both dynamics as potentially positive for us.
Okay, well, thanks for that and maybe if I could just follow up with Steve on the guidance Stephen.
Paul R. Edick: We're both selling for the benefit of the patient, so the opportunity is so huge. Market growth is really what both companies should be focused on; it's what our focus is, and we're hopeful that Amphisar really gets going in a more significant way. As for Teva and the dynamic in the Cushing's market, as we know, the Cushing's market has been generic for a long time with several new big brands over the last decade or so. There's always been that dynamic.
In your prepared remarks, you sort of gave us a little bit of color around the guidance, but when we think about the growth 4% to 22%, it's a pretty big range and so I was wondering if you could just unpack that a little bit are there any sort of incremental sort of milestone payments you're expecting within those within that guidance range and then secondly.
Paul R. Edick: I think this particular situation with Corelim being as big as it is, that dynamic, we believe, will play in our favor because we think we have a really good differentiation versus Corelim in terms of our ability to normalize cortisol. And having it generic in the market is going to sort of be disruptive for that franchise and, to our estimation, kind of put it in play for others like us to take share. So I see both dynamics as potentially positive. Okay, well, thanks for that.
When you think about your three products it kind of sounds like youre, suggesting convey is <unk> seen some weakness and so maybe we should expect that to be down modestly in 2004 with that offset by growth in the other two products and my thinking about all that correctly or is there anything more you can give us related to the guidance.
Well I think we might need to tag team that with a little bit.
Steven M. Pieper: And maybe I can just follow up with Steve on the guidance. Steve, in your prepared remarks, you sort of gave us a little bit of color around the guidance. But when we think about the growth of 4% to 22%, it's a pretty big range. And so I was wondering if you could just unpack that a little bit.
So I'll take the <unk>.
The various products convey is I mean.
We had an amazing 2023 with diverse.
Set all along sooner or later, we're going to start losing to patients sooner or later, we're going to see some price degradation.
The degree to which that is going to potentially happen as is.
Steven M. Pieper: Are there any sort of incremental sort of milestone payments you're expecting within that guidance range? And then secondly, when you think about your three products, it kind of sounds like you're suggesting, you know, conveyance, conveyance is seeing some weakness. And so maybe we should expect that to be down modestly in 24 with that offset by growth in the other two products. Am I thinking about all that correctly? Or is there anything more you can give us related to the guidance? I think we might need to tag team that one a little bit.
The potential downside is just as big this year as it was last year.
And our guidance was to reflect a wide range, because we werent sure and so what we see so far this year is a little bit of patient loss, but we're not too sure of the degree to which that's going to accelerate or not I'll turn it over to Steve Yeah, Yeah, and I think we were I think were hopefully pretty clear in our prepared remarks that we do.
We expect a decline.
Paul R. Edick: So I'll take the various products. Cabeas, I mean, we had an amazing 2023 with Cabeas.
As opposed to 2023, where we saw.
Growth so that's driving the wide range I think we.
Steven M. Pieper: We've said all along that sooner or later, we're gonna start losing a few patients. And sooner or later, we're gonna see some price degradation. The degree to which that is going to potentially happen is, The potential downside is just as big this year as it was last year, and our guidance was to reflect a wide range because we weren't sure. And so what we've seen so far this year is a little bit of patient loss, but we're not too sure of the degree to which that's going to accelerate or not. I'll turn it over to Steve. Yeah, yeah.
We're excited about the growth the continued growth of both <unk> where core lab.
On the top end of the guidance, yes, I think that that we touched a little bit on the kind of episodic nature of this technology partnership business and the contributions we saw $10 5 million from our various partnerships in 2023, the degree to which that that is.
Sticky again in 2024 remains to be seen.
Steven M. Pieper: And I think, you know, we were, I think we're hopefully pretty clear in our prepared remarks that we do expect a decline, as opposed to 2023, where we saw growth. So, yeah, that's driving the wide range. I think we're excited about, you know, the growth, the continued growth of both Jeevoke and Rekorlev at the top end of the guidance. Yeah, I think that we touched a little bit on the kind of episodic nature of this technology partnership business and the contributions we saw of 10.5Million from our various partnerships in 2023. The degree to which that is sticky again in 2024 remains to be seen. We don't control that fully as, you know, that is largely at the discretion of our partners. So, you know, the pace of our partners and the pace of our partners.
We don't control that fully as you know that is that largely at the discretion of our partner so.
The pace of our partner and the pace of our partners. So yes that I think youre thinking about it the right way Glenn that that's what's driving the wide range in 2024, and the potential lack of growth in <unk>, we expect to be made up by <unk> <unk>.
And that's why we also in my remarks, I gave a little bit of the range. If you took out the nonrecurring nonrecurring one timers the ranges.
As.
Greater growth all double digit growth across the range.
Thanks for the details.
Sure.
Our next question comes from Chase Knickerbocker with Craig Hallum.
Please go ahead.
Good morning, guys. Congrats on the good finish to 2023.
Maybe just to start on a clarifying question on guidance, so ending the year, obviously with $72 5 million in cash based on that first press release, Youre, adding about $35 million in the first quarter and so.
Steven M. Pieper: So, yeah, that I think you're thinking about it the right way. Glenn, that's, you know, what's driving the wide range in 2024 and the potential lack of growth and conveyance we expect to be made up by Jeevoke and Rekorlev. And that's why, in my remarks, I gave a little bit of the range. If you took out the non-non-recurring one-timer, the ranges, and greater growth. I mean, all double digit growth across. Thanks for the details. Sure. Our next question comes from Chase Knickerbocker with Craig. Please go ahead.
My math right that that means cash burn if we kind of take that $175 million cash number combined is somewhere around $40 million at the midpoint of your cash guidance is that kind of the right math there.
Yes, you are about right.
Got it thanks for that.
Maybe just first starting with <unk>.
What actions are the payers, taking just a little bit more detail there as far as what you've seen so far.
Operator: Good morning, guys. Yeah, congrats on the good finish to 2023. Maybe just to start on a clarifying question on guidance. So, ending the year obviously with $72.5 million in cash, based on that first press release, you're adding about $35 million in the first quarter.
Forcing patients to switch that are currently on therapy are when youre getting them to the top of the funnel theyre pushing them to the generic first just kind of clarification there on exactly what's happening and then if we look at 2024 is mainly going to be volume as what youre expecting or do you expect to give some some ground on price as well.
Steven M. Pieper: And so, is my math right that that means cash burn if we kind of take that $107.5 million cash number combined, it's somewhere around $40 million at the midpoint of your cash guide? Is that kind of the right math there? Yeah, you're about right. Got it. Thanks for that. You know, maybe just first starting with Cadeas.
So we don't expect any more.
Movement on price unless there is a second generic at the end of the day.
Paul R. Edick: What actions are the payers taking? Just a little bit more detail there as far as what you've seen so far. Are they, you know, forcing patients to switch who are currently on therapy? Or, you know, when you're getting them to the top of the funnel, are they pushing them to generic first?
Going to be volume.
And the payers are going to do with the payers do I mean, it's all the same stuff, there's a denial and appeal et cetera.
And little by little they cleave off a few patients here and there.
It's in their best interest we get that.
And they are going to.
We believe that's going to persist and that will be lost.
Paul R. Edick: Just kind of clarifications on exactly what's happening. And then, if we look at 2024, is it mainly going to be volume, is that what you're expecting? Or do you expect to give them some ground on price as well?
Salt in.
More patient loss.
Depending on net net depending on how fast we fill the funnel, there's still a lot of patients out there.
We're going to be still very aggressive.
Paul R. Edick: So we don't expect any more movement on price unless there's a second generic at the end of the day. It's going to be volume, and payers are going to do what the payers do. I mean, it's all the same stuff.
But we have to be.
Forward looking in terms of our expectations for a decline so that's what we're signaling.
I think that.
Yes that answers it thanks, and then on a core level.
First just kind of give us a little bit of a look into the background as far as how is the how is the funnel kind of looking are you seeing any sort of shrinkage and kind of time from script written script finally being filled and then any kind of increase in your success rate of kind of.
Paul R. Edick: There's denial, there's an appeal, et cetera, and little by little, they clotted off a few patients here and there. It's in their best interest. We get that. We believe that's going to persist, and that will result in more patient loss, depending net net, depending on how fast we fill the funnel. You know, there's still a lot of patients out there. We're going to be very aggressive. But we have to be forward-looking in terms of our expectations for decline, so that's what we're saying. Yep, that answers it. Thanks. And then on RecorLav.
Appeals and all that just success rate of going from a script written the script filled.
Yes, so we're thrilled with the continued.
Growth in the referrals to therapy.
Paul R. Edick: You know, kind of first, just kind of give us a little bit of a look into the background as far as you know, how's the funnel kind of looking? Are you seeing any sort of, you know, shrinkage and kind of time from, you know, script written to script finally being filled? And then any kind of increase in your success rate of, you know, appeals and all that just, you know, success rate of going from script written to script filled? Yeah, so we're thrilled with the continued growth in referrals to therapy. I mean, it is really accelerating.
It is really accelerating we're thrilled with the amount of patients that are being referred to therapy.
Our our conversion to patients on drug continues to be really solid and continues to grow. So we're happy with that the time to.
Time factor is real.
The more you grow the more patients you put on.
The more you become a target with payers and it takes more time that being said.
And I've said this before if you look at the retail market for <unk> and you say what would be a good percent of covered lives between <unk>.
Paul R. Edick: We're thrilled with the amount of patients that are being referred to therapy. Our conversion to patients on the drug continues to be really solid and continues to grow, so we're happy with that. The time factor is real.
Commercial and Medicare.
75% would be great, 80% is about as good as you get in the pharmaceutical business.
Paul R. Edick: I mean, the more you grow, the more patients you put on, the more you become a target with payers, and it takes more time. That being said, and I've said this before, if you look at the retail market for GVOC and say, what would be a good percent of covered lives between commercial and Medicare, you know, 75% would be great, 80% is about as good as you get in the pharmaceutical business. In rare diseases and these expensive drugs, 50 to 60% of conversion from referral to patients on the drug we think is equivalent and really good. And it varies within that range. You know, sometimes it's a little slower, sometimes it's a little more, but it's in that 50 to 60% range. And we think that's a solid conversion percentage for the number of referrals we get. And then kind of taking that commentary and kind of relating it to what 2024 might look like. I mean, this is kind of a hard one for us to model.
In rare disease and these expensive drugs.
50% to 60% of conversion from referral to patients on drug we think is equivalent and really good and it varies in that range.
Sometimes it'll slow or sometimes it's a little more but it's in that $50 to 60% range and we think thats that solid conversion percentage for the number of referrals we're getting.
And then kind of taking that commentary and kind of relating it to what 2024 might look like I mean.
This is kind of a hard one for us to model, obviously, it's been a little bit lumpy.
As far as growth goes I mean, what should we think of some for as far as like a sequential growth rate should we think of it as kind of bouncing between the low teens. We saw in Q3 of 'twenty, three and kind of the low twenty's that we saw in Q4 of 2023.
Steven M. Pieper: Obviously, it's been a little bit lumpy as far as growth goes. But, what should we think of as far as a sequential growth rate is concerned? Should we think of it as kind of bouncing between the low teens we saw in Q3 of 2023 and kind of the low 20s that we saw in Q4 of 2023, as it relates to kind of how the funnel is looking and how those kinds of conversions have been trending? Yeah, I think, good question, Chase.
As it relates to kind of how the funnel is looking and how those kind of conversions had been had been trending.
Yes, I think good question Jake Chase.
And we haven't we've been pretty deliberate in not providing.
Specific product guidance, but what I would say is I think you can expect kind of a similar steady increase.
In patient demand and revenue growth over 2023 so.
Steven M. Pieper: And, you know, we've been pretty deliberate in not providing specific product guidance. But what I would say is, I think you can expect kind of a similar steady increase in patient demand and revenue growth over 2023. So I don't think that there's, we're not expecting some kind of step function increase, you know, in the middle of the year, that would accelerate that. At least that's not, you know, in the cards right now.
I don't think that there is we're not expecting some kind of step function increase in the middle of the year that would accelerate that at.
At least that's not in the cards right now, but I think to expect a similar kind of steady growth.
Year over year.
Is that fair kind of starting assumption yes.
Yes.
Great. Thanks for the time guys.
Steven M. Pieper: But I think to expect a similar kind of steady growth year over year is a fair kind of starting assumption. Great. Thanks for the time, guys. Thanks, Chase. The next question comes from Roanna Ruiz with Lyrical.
Thanks Jay.
<unk>.
The next question comes from marijuana release with Leerink partners. Please go ahead.
Great Good morning, everyone.
So a question for XP 80, 121 could you remind us what your expectations are for the phase III data coming this year and what kind of results would you hope to see that gives you more confidence to advance into phase III.
Operator: Please go ahead. Great morning, everyone. So, a question for XP8121.
Paul R. Edick: Could you remind us what your expectations are for the Phase 2 data coming this year? And what kind of results would you hope to see that would give you more confidence to advance into Phase 3? Hey Roanna, good morning.
Hey, everyone. Good morning.
This study is very is predicated on the.
Paul R. Edick: This study is predicated on confirmation of the conversion from the oral dose to the liquid dose at more dosage strengths across the range. So for levofyroxine, there are like 10 or 12 different dosage strengths. And in our phase one study, where we provided the FDA with a couple of those, you know, a couple of times at a couple of dosage points. They just wanted to see it across more dosages and with, you know, patients who are actually on Levo or former Levo patients. So the information we will get will be a confirmation of that conversion at every dosage across the range, number one. Number two, we're gathering a great deal of information on the market need relative to the screen failures we've seen. Our goal was to get patients who were stable on their current medication, and they were hard to find. So that will be important data as well. But it's just a confirmatory study for the dosage conversion, and then we'll have a discussion with the FDA about the phase three program. Got it, super helpful.
Confirmation of the conversion from the oral dose to the liquid dose at more dosage strengths across the range. So legal thyroxine, there's like 10 or 12 different dosage strengths.
And our phase one study, where we provided the FDA with a couple of those couple of couple of dosage points.
They just wanted to see it across more dosages and across with.
Patients, who are actually on levo or former legal patients. So the information we will get will be a confirmation of that conversion at every dosage across the range number one number two.
Gathering a great deal of information on the market need relative to the screen failures. We've seen our goal was to get patients who were stay.
Stable on current medication and they were hard to find so that will be important data as well.
But it's just a confirmatory study for the dosage conversion and then then we'll have a discussion with the FDA on.
Phase III program.
Got it Super helpful and FERC correlate to when are you guys hearing anecdotally from the field for us in terms of their interactions with physicians about its profile and.
Paul R. Edick: And for Rekorlev2, what are you guys hearing anecdotally from the field force in terms of their interactions with physicians about its profile? And what are you thinking about its expected steady growth into 2024? In broad strokes, could it come from the field force, physicians getting more educated or more experienced with Rekorlev2, something like that? Thanks, Juana.
What are you thinking about as expected steady growth into 2024, just like broad strokes could it come from the field force physicians getting more educated or experience with korolev something like that.
Thanks, Ron.
Paul R. Edick: The patients are coming from everywhere. The more physicians are getting exposed to Ricorla, the more it becomes a valuable tool for them. So, you know, we've seen individual physicians go from trying it to using it first line. So it's the experience that they get, how patients are being treated, and normalized, and patients are not having a lot of side effects.
The patients are coming from everywhere.
More physicians are.
Getting exposed to record levels.
It becomes a valuable tool for them so.
We've seen individual physicians go from trying it to using it first line. So it's the experience that they get which patients are being.
Cortisol is being managed and normalized patients are not having a lot of side effects physicians get more and more comfortable in terms of the physician interaction in the field.
Paul R. Edick: Physicians are becoming more and more comfortable. In terms of physician interaction in the field, it's been very receptive. We're having great conversations with physicians. The receptivity to Recorlav has been very high. So that's been very positive. I mean, depending on where you go do doctor calls, you're gonna find ones that have never even heard of Recorlav because they're not accessible to us.
Been very receptive were getting.
Great conversations with physicians the receptivity to record live has been very high.
So that's been very positive.
Depending on if you go do Doctor calls Youre going to Youre going to find ones that have never even heard of record low because theyre not accessible to us, but the vast majority of physicians that are accessible.
Paul R. Edick: But the vast majority of physicians that are accessible. The initial trial has been good. A broad cross-section of physicians, and the experience has been positive. So. That's all.
Initial trial has been good a broad cross section of physicians and the experience has been positive so.
Operator: I think that's all good. Got it, thanks. The last question comes from David Amsellem with Pieper Sandler.
That's all I think that's all good.
Got it thanks.
The last question comes from David <unk> with Piper Sandler. Please go ahead.
Paul R. Edick: Please go ahead. Hey, thanks. So, on Recorliv, I'm sure you guys are well aware of the CORSEP study called Catalyst, which is looking at prevalence, and that's going to be presented later this year at ADA. I guess I wanted to just get your general thoughts on how you think those results could mean for Recorliv and the opportunity for the product going forward. And, you know, to the extent that there is indeed a fundamentally different understanding of hypercortisolism, do you envisage expanding your commercial organization to target a wider audience of physicians, namely diabetologists? How are you thinking about all that? Thank you. Okay, there's a lot to unpack here, David.
Hey, thanks, so on record.
I'm sure you guys are well aware of the.
The course of study called catalyst, which looked at is looking at prevalent and thats going to be presented later this year at Ada I guess I wanted to just get your general thoughts on how Youre thinking about those results in terms of the prevalence of hyper cortisol Ism, what do you think that could.
Mean for.
Where our core live and the opportunity for the product going forward and.
To the extent that there is indeed, a fundamentally different understanding.
Hyper cortisol rhythm.
Do you envision expanding your commercial organization too.
Target a wider audience of physicians, namely Diabetologist, how are you thinking about that thank you.
Okay, there's a lot to unpack in there David.
Paul R. Edick: Bottom line, we like the direction that Corecept is going in with the Coraline franchise because we do believe that moving up in terms of patient severity is a good thing. Market expansion is really, I believe, their goal, which is good for us as well. We will benefit from that market expansion. And if you recall, on the last call, we talked about how we originally were targeting 3,200 more severe patients. And now our target is expanded to about a patient base of potentially 8,000. And I think the strategy of moving up in the treatment paradigm is even bigger than that. So that's important for us, and I mean as they drive market growth. That expansion helps us as well. Okay, that's helpful.
Bottom line the.
We like the direction that <unk> is going in with the coral and franchise because we do believe that moving up in terms of patient severity is a good thing market expansion is really I believe their goal, which is good for us as well, we will we will benefit from that market expansion.
If you recall I think the last time the last call. We talked about we originally were targeting 3200.
More severe patients and.
Now our target is expanded to about not about a patient base potentially 8000.
And I think the strategy of moving up in the treatment.
Paradigm.
It's even bigger than that so that's important for us and.
As that as they drive market growth that expansion helps us.
Well so.
Okay.
Okay.
Paul R. Edick: And then in terms of expanding the commercial infrastructure, we always look to add resources wherever we can and, however, when we can afford it. One of the things, as Steve said, the benefit of having a great partner like Hafen is they recognize the progress we've made and the degree to which we've de-risked the business. They want to see us invest further for additional market penetration in our commercial business. They want to see us advance the technology business, and they want to see us advance Levo. So they've really stepped up at a reduced cost to help us do all of the above, expanding tomorrow in the Core Lab organization, but we're always looking at it. And, you know, this will be an important year for that.
It's helpful and then in terms of expanding the commercial infrastructure.
We always look to add resources wherever we can and however, when we can afford it.
One of the things.
Steve said.
The benefit of having a great partner like <unk> as they recognize the progress we've made and the degree to which we've derisked the business.
I want to see us invest further for additional market penetration in our commercial business. They wanted to see has advanced the technology business.
They want us to its advanced levo, so they've really stepped up.
Reduce costs to help us do all of the above.
We are.
Expanding tomorrow and the corollary organization, but we're always looking at it and this will be an important year from that perspective.
Okay. That's helpful and then sorry, if I missed this but are you getting.
Paul R. Edick: Okay, that's helpful, and I'm sorry if I missed this, but are you getting frontline Cushing's patients on to RecorLiv? Is that a decent chunk of the overall patient mix thus far? Today, it's a pretty good chunk of the overall patient mix. The answer is, yes, we are getting them. Those patients take a little bit longer to adjudicate insurance, but we're being very successful there as well. Early on, we were getting only the patients who were switching, but as physicians get comfortable with a patient that has been on a couple of different things and has tried several different drugs and the correlative answers his needs, then we begin to get first-line patients from that clinician.
Frontline.
Cushings patients on to <unk> is that a decent chunk of the overall patients thus far.
Today, it's a pretty good chunk of the overall patient mix. The answer is yes, we are getting them.
Those patients take a little bit longer to adjudicate insurance, but we're being very successful there as well.
Early on we were getting only the patients who are switching.
But as physicians get comfort with a patient that has been on a couple of different things in this tried several different drugs and recall of answers as his need then we begin to get first line patients from that clinician. So.
Paul R. Edick: Okay, thanks. I'll leave it there. I'll now turn the call back to Paul Edick for closing remarks, www. XerisPharmaceuticals.com. Thanks everybody for the great questions and thanks for listening today. As you heard, we have delivered another year of exceptional growth, and we're very proud of our performance to date. We expect that momentum will continue in 2024, and we look forward to another year of growing an enterprise for which we can all be proud. Thank you very much. Thank you everyone for joining us today. This concludes our call, and you may now disconnect your lines. www.xerispharmaceuticals.com
Okay. Thanks, I'll leave it there.
Yeah.
I will now turn the call back to Paul <unk> for closing remarks.
Thanks, everybody for great questions and thanks for listening today as you heard we have delivered another year of exceptional growth and we're very proud of our performance to date, we expect that momentum will continue in 2024, and we look forward to another year of growing in the enterprise for which.
We can all be proud thank you very much.
Thank you everyone for joining us today. This concludes our call and you may now disconnect your lines.
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Yeah.