Q4 2024 Esperion Therapeutics Inc Earnings Call
Okay.
Ladies and gentlemen, thank you for standing by and welcome at this time all participants are in a listen only mode.
Following the presentation there will be a question and answer session. Please be advised that today's conference call maybe recorded.
Speaker Change: I would now like to turn the call over to Ilene that Vanessa Yeah director of Investor Relations for Experian Therapeutics you may begin.
Speaker Change: Thank you operator, good morning, and welcome to experience fourth quarter and full year 2024 earnings conference call.
Speaker Change: With us on today's call are Sheldon Koenig, President and CEO, and then holiday CFO. Other members of the executive team will be available for Q&A following our prepared remarks.
Speaker Change: <unk> issued a press release earlier this morning detailing the content of today's call.
Speaker Change: Copy can be found on the Investor page of our website together with a copy of the presentation that we will also be referencing.
Speaker Change: I want to remind callers that the information discussed on the call today is covered under the safe Harbor provision of the private Securities Litigation Reform Act.
Speaker Change: I caution listeners that management will be making forward looking statements.
Speaker Change: Results could differ materially from those stated or implied by our forward looking statements due to the risks and uncertainties associated with the business.
Speaker Change: These forward looking statements are qualified in their entirety by the cautionary statements contained in today's press release and in our SEC filings.
Speaker Change: This conference call contains time sensitive information and is accurate only as of the date of this live broadcast.
Speaker Change: March 4th 2025.
Speaker Change: Undertake no obligation to revise or update any forward looking statements to reflect events or circumstances. After the date of this conference call and webcast.
Speaker Change: As a reminder, this conference call and webcast are being recorded an archive.
Speaker Change: We'll begin the call with prepared remarks, and then open the line for your questions I'll now turn the call over to Sheldon.
Sheldon Koenig: Thank you Elena and good morning, everyone and thank you for joining us as I have noted in prior calls 2024 was a transformational year for spirit as we receive the expanded labels for our benefit Doug acid products in the U S supported global expansion with our partners in key markets and significantly strengthened our financial structure to enhance our balance sheet.
Sheldon Koenig: <unk> and provide us with financial and operational flexibility to support our future growth.
The advances and improvements we made during 2024 formed a strong foundation from which we can focus on our bold vision for the future that is centered around three strategic pillars for building a blockbuster company.
Sheldon Koenig: Continued revenue growth operating profitability and portfolio expansion and pipeline advancement.
Sheldon Koenig: Focusing on our first pillar, increasing revenue and operating profitability, let us turn now for a look at our progress and plans moving forward with the sales and marketing of our <unk> acid products in the U S and global markets.
Sheldon Koenig: In March 2024, we received U S. FDA approval for the expanded label for <unk>, making it the only FDA approved non statin to lower LDL cholesterol and reduce the risk of myocardial infarction and coordinate rate revascularization in both primary and secondary prevention patients.
Sheldon Koenig: <unk>.
Sheldon Koenig: Since that time, we have consistently posted double digit sequential quarterly growth in total retail prescription equivalents or trp's.
Sheldon Koenig: During the fourth quarter of 2024, we achieved 12% sequential quarterly growth in trp's compared to the third quarter of 2024.
Sheldon Koenig: Substantially expanded payer access and now have more than 173 million lives covered in the US We are also proud that <unk> and Thats what that had been recently added as preferred agents to the U S Department of defense uniform formulary now accessible to the 9 million active duty dependent and retire.
Sheldon Koenig: <unk> covered under this program.
Sheldon Koenig: In tandem we increased our prescriber base by 10% from last quarter and now have more than 25000 health care providers, writing scripts, the large and growing prescriber base is an important indicator of potential future growth as we have the opportunity to grow their base as they prescribe our products to more and more of their eligible.
Sheldon Koenig: <unk>.
Sheldon Koenig: We expect to continue to build on this momentum throughout 2025 and believe that the established cardiovascular clinical benefits of our products combined with an expanding awareness among health care providers and ever improving and growing patient access will support increasing trp's and revenues.
Sheldon Koenig: To drive both physician and patient awareness of the prevalence of statin intolerance. We are introducing a series of leave behind resources that highlight the fact that up to 30% of patients are statin intolerant and showcase the evidence that demonstrates how <unk> can effectively manage these patients at high risk of <unk>.
Sheldon Koenig: Vascular disease.
Sheldon Koenig: Our goal is to continue to underscore the persistent unmet need while promoting a safe and effective solution.
Sheldon Koenig: Consequently to further aid health care professionals and the management of partial statin intolerance, we are developing triple combination products in the U S that would provide physicians with the flexibility of a suite of options that include monotherapy Netflix Hall dual therapy, <unk> and triple combination therapy.
Sheldon Koenig: <unk> acid is that the market and either atorvastatin or receive a statin.
Sheldon Koenig: This represents an exciting opportunity to expand our role in the cardiovascular prevention market as the published literature suggests triple combination products can lower LDL cholesterol in excess of 60%.
Sheldon Koenig: This level of efficacy has the potential to rival both existing and emerging injectable and oral therapies offering a valuable oral option for both patients and physicians.
Sheldon Koenig: Now turning to the meaningful progress, we're making internationally through our partnerships. We are looking ahead to an exciting year of continued growth in Europe, and new product approvals and launches in key geographies.
Sheldon Koenig: First we are particularly pleased that our Japanese partner Otsuka pharmaceutical has submitted a new drug application for the manufacture and sale of our <unk> acid product in Japan for LDL cholesterol lowering.
Sheldon Koenig: They expect approval and National Health insurance pricing in the second half of 2025.
Sheldon Koenig: Japanese market is the worlds third largest cardiovascular prevention market and we believe the royalties on Japanese products health will be a meaningful revenue contributor over time.
Sheldon Koenig: Turning now to the European market, our European partner DSC continues to successfully market in Orlando and New study that has demonstrated strong revenue growth.
Sheldon Koenig: Our royalty revenue from DSC increased 9% sequentially to $9 $7 million in the fourth quarter of 2024 for.
For the full year of 2020 for royalty revenue increased 116% year over year to $32 $6 million.
Sheldon Koenig: As of the end of December approximately 453000 patients have been treated with our therapies in Europe, representing 19% sequential growth over the past three months. Since September. This continued expansion gives us confidence that with our label expansion, we can build a sizable market in the U S.
Sheldon Koenig: Tech transfer for both new Orlando and New study are also progressing nicely.
Sheldon Koenig: Yesterday, we were pleased to announce that we partnered with CSL soliris to commercialize <unk> in Mexico, and Australia, and New Zealand under the terms of the agreement we received an upfront payment and are eligible for near term milestones along with a profitable transfer price on product sales.
Sheldon Koenig: This is an important market for our products as cardiovascular disease affects one 2 million people and is a leading cause of death in Australia, and New Zealand and estimated 175000 adults are living with cardiovascular disease and one in three deaths are caused by cardiovascular disease.
Sheldon Koenig: Furthering our international expansion, we entered into a licensing agreement with Neil from Israel for the exclusive rights to commercialize <unk> and extra that in Israel and expect to file an NDA for marketing approval in Israel in the first half of 2025. In addition, we filed new drug submission to health, Canada for <unk>.
Sheldon Koenig: <unk> and anticipate marketing approval in the fourth quarter of 2025.
Sheldon Koenig: Collectively our international partnerships are delivering increasing royalty revenue further demonstrating the global potential of our <unk> acid products and supporting our strategic focus on driving revenue growth and operating profitability.
Sheldon Koenig: Finally, we continue to reinforce the cardiovascular risk reduction benefits of our products with the ongoing presentation and publication of compelling clinical data in the coming weeks, we look forward to presenting two post hoc analysis from our clear outcome study and poster presentations at the upcoming American College of Cardiology.
Sheldon Koenig: <unk> scientific session being held in Chicago.
Sheldon Koenig: Fortunately, we will be presenting these data to an audience of key physicians, who play a critical role in treatment decisions.
Sheldon Koenig: In addition, we will have an interactive exhibit allowing health care professionals to engage with our clinical and commercial teams to gain deeper insights into the cardiovascular benefits of our <unk> acid products for.
Sheldon Koenig: For those attending this year's ACC, we welcome you to visit us at our Booth.
Sheldon Koenig: Turning our attention to our other pillars for growth portfolio expansion and pipeline advancement are commitment to R&D strengthened all three strategic pillars continued revenue growth operating profitability and portfolio expansion and pipeline advancement with a strengthened balance sheet, we are well positioned.
Sheldon Koenig: To in license or acquire a synergist take cardio metabolic assets, while continuing to advance our clinical pipeline.
Sheldon Koenig: Leveraging our leadership in ACL why biology, we are actively exploring new therapeutic opportunities and developing next generation inhibitors designed to address serious diseases.
Sheldon Koenig: <unk>, a rare and orphan chronic liver and kidney diseases.
Sheldon Koenig: We look forward to sharing more details on our clinical development plans at our R&D day on April 24, 2025, where we will announce a lead indication and introduce our first candidate for development.
Sheldon Koenig: With that overview of the business, let me turn the call over to Ben for a detailed review of our financial progress during the fourth quarter.
Sheldon Koenig: <unk>.
Ben: Thank you Sheldon and good morning, everyone and thank you for joining US today. During 2024, we executed two transformational financial transactions that fundamentally reshaped our capital structure, providing us with enhanced operational and financial flexibility.
Ben: These improvements coupled with our fortified balance sheet empower us to focus on investing in our three pillars for growth to build a leading global biopharmaceutical powerhouse.
Ben: In June 2024, we closed on a royalty purchase agreement with <unk> life Sciences, receiving approximately $304 $7 million in cash in exchange for 100% of our royalty interest from DSC royalty sales.
Ben: <unk> will receive the DSC royalty stream net <unk> acid product sales in Europe until it has received an aggregate amount equal to one seven times its investment thereafter, all future payments on Dfc royalties will revert back to a spirit.
Ben: Proceeds from the royalty purchase agreement facilitated early payout and termination of the Oberland secured facility, removing all liens and covenants associated with that agreement.
Ben: In December 2024, we executed a series of financing transactions that supported the repayment of the majority of our $265 million convertible debt facility.
Ben: Transactions included a $150 million secured term loan facility led by funds managed by <unk> capital and joined by funds managed by healthcare royalty and a new $100 million convertible note with a credit investors.
Ben: We used the proceeds from the loan at approximately $60 million of the proceeds from the note to repay $210 million of the existing convertible debt with the remaining approximately $27 million of the net proceeds for general operating purposes.
Ben: Our fourth quarter 2024 financial results can be found in the press release, we issued this morning and more detail will be included in our upcoming 10-K.
Ben: Fourth quarter 2024, total revenue was $69 1 million, an increase of 114% compared to $32 3 million in the fourth quarter of 2023.
Ben: U S net product revenue of $31 6 million compared to $20 $8 million for the comparable period of 2023, an increase of approximately 52%.
Ben: We have continued to demonstrate double digit RPE growth with a 12% increase from last quarter and 8% growth in new to brand prescriptions.
Ben: We have previously discussed the impact of the Medicare coverage gap and in Q4 2024, we experienced an exceptional impact due to the number of new Medicare contracts, we initiated in 2024.
Ben: With the anticipated Medicare reform this year and the removal of the coverage gap. We are confident that quarterly revenue growth will more closely align with RPE growth growing forward.
Ben: Collaboration revenue was $37 6 million compared to $11 5 million for the comparable period in 2023, an increase of approximately 227%.
Ben: This revenue growth reflects the strong momentum we are seeing from our partner DSC as well as a one time milestone from otsuka upon the J NDA submission.
Ben: Turning to the rest of the P&L for the fourth quarter 2020 for research and development expenses were $11 million compared to $17 7 million for the comparable period in 2023, a decrease of 38% primarily attributable to a clear outcome study that was completed in 2023.
Ben: Selling general and administrative expenses were $36 9 million compared to $45 4 million for the comparable period in 2023, a decrease of 19%.
Ben: The decrease was primarily related to increased legal litigation expenses, reflecting onetime legal expenses from legal resolution of the fourth quarter 2023.
Ben: Partially offset by increased compensation costs related to the ramp up of our sales force associated with our commercial launch and promotional costs. We continue to manage expenses prudently and expect expenses to remain similar to current levels in 2025.
Ben: We entered 2025 and a very strong financial position with cash and cash equivalents of $144 8 million as of December 31, 2024.
Ben: With the expected milestones from our global partners. We believe we will finish 2025 with an even stronger cash position.
Ben: We are reiterating our full year 2025 operating expense guidance, which is expected to be approximately $215 million to $235 million, including $15 million of noncash expenses related to stock compensation.
Ben: With that I will now turn the call back over to Sheldon for closing remarks Sheldon.
Ben: Our advances in 2024 form the foundation for us to successfully execute three strategic pillars for growth that will drive our mission forward. These pillars are supported by innovation collaboration and expansion. These are not just words, they represent our commitment to advancing cardiovascular prevention and improving patient.
Ben: Outcomes.
Ben: Innovation is at the heart of what we do we continue to implement cutting edge sales and marketing programs to reach more health care providers and patients our strengthened financial position supports our goal to acquire or in license synergistic products and we are investing in novel research and development to bring new.
Ben: Lifesaving technologies to market.
Collaboration is essential in our field.
Ben: <unk>, we continue to forge strong partnerships with leading health care providers industry experts and global partners.
Ben: Together, we are executing a robust strategy that supports our vision and amplifies our impact.
Ben: Expansion is our promise to reach more patients and communities. We are growing our U S revenue entering new markets by enhancing our global footprint and have plans to add to our portfolio.
Our goal is to make cardio metabolic prevention accessible to everyone everywhere.
Ben: As we look to the future I'm confident these pillars will guide us to new Heights, our commitment to excellence, our passion for innovation and our dedication to our mission, we'll continue to drive our success.
Ben: Before we open the call to your questions I want to take a moment to thank our shareholders partners and team members for your unwavering support.
Ben: Together, we are making a difference in the lives of millions and I look forward to sharing our continued progress with you throughout the coming year. Operator, we are ready to open the call to questions.
Speaker Change: Thank you to ask a question. Please press star one on your telephone and wait for your name to be announced and to withdraw. Your question. Please press star one one again and the first question will come from Dennis thing with Jefferies. Your line is open.
Dennis: Hi, good morning, and congrats on all the progress.
Speaker Change: On the triple.
Speaker Change: <unk>.
Speaker Change: I have one question on the Triple combo in the U S.
Speaker Change: You agreed with the FDA on the regulatory path forward here and we need to have to run any cbot and then does the triple combo impact through 2031, <unk>, which I think is based off of composition of matter patents. Thank you.
Speaker Change: Thanks, Dennis So right now we're not going to provide any additional details related to our discussions with the FDA, we will be sharing more of that.
Speaker Change: Probably in the fall timeframe, what I can tell you is that it does not necessitate a cbot.
Speaker Change: It does not necessitate any heavy lift as it relates to doing any type of clinical study. So stay tuned we're very excited about it.
Speaker Change: How they to comment as it relates to impact on low band, yes, similar to what Sean just said, we're going to release more information over the course of the year. However, I will say this is a very important step to the lifecycle management of <unk> acid and further substantiates and solidifies our position and potentially extending our patents.
Speaker Change: Okay.
Speaker Change: Okay got it very helpful and if I can have one follow up.
Speaker Change: For us the cost of revenue in 2025 is it reasonable to assume the quarterly revenue growth and accelerate this year since volumes should pick up from improved access and the typical gross to net pressure that you traditionally see going through the year has now smoothed out with the part D redesign.
Speaker Change: No.
Speaker Change: Ben.
Speaker Change: Yeah, I think Youll continue to see the same steady and I would call it significant growth that we've seen in the past.
Speaker Change: On the gross to net factor I mentioned it in the prepared remarks, youll see that smooth out of the gross to net and so you should see more of a one to one translation of RPE growth to revenue growth, which when you look at the second half of the year that was our biggest headwind going through there so compared to 2024, I think that second half growth will be much more consistent.
Speaker Change: And much more steady which is a net positive for us.
Speaker Change: Perfect. Thank you.
Speaker Change: And the next question will come from Joe <unk> with H C. Wainwright Your line is open.
Joe: Hi, good morning, everyone. Thanks for taking the question a couple of questions. If you don't mind. So first with regard to U S sales, how should we view your efforts to build efficiencies into Cogs.
Speaker Change: So I can take that one from from the U S side, our Cogs have been very consistent to put some numbers behind our price per tablet hasnt really changed since beginning of 2024. When you look at Cogs. It really the biggest driver is some of that gross to net deterioration in the second half.
As well as the I would say proportion of DSC tablet sales.
Speaker Change: We are constantly.
Speaker Change: We are evaluating how we can drive our per tablet costs down that's a longer term discussion as we started validating some of these cheaper and lower cost suppliers.
Speaker Change: That again is a longer term discussion and I think once we complete the tech transfer. That's when you really will see that gross margin benefit as we remove most of these low margin sales off our books.
Speaker Change: No. That's very helpful. Thank you and then I guess maybe.
Speaker Change: Maybe some feedback from the field if you don't mind.
Speaker Change: I guess as Youre really detailing and marketing here.
Speaker Change: The launch really in play now I guess I would phrase it this way what are the key yes is that you're getting right now.
Speaker Change: From new prescribers number one and what are the key.
Speaker Change: Those if you will.
Speaker Change: Presumably education is still the main reason for not prescribing yet or any other factors you'd like to share with us.
Eric: Hey, Joe It's Eric I'll take that one so.
Speaker Change: Yes.
Speaker Change: As you state are based upon the efficacy of the clinical profile of the.
Speaker Change: The products that we have next I'll call. It back book that do something that other products don't deal and they have that outcome benefit from our primary and secondary prevention perspective, and they've also been studied in a really unique population a partial and.
Speaker Change: Statin intolerant patients. So those are the drivers as you asked if you will the distinct profile that we have unique population that we've been steady then in terms of the opportunities. We continue to educate on the improved coverage that we have.
Speaker Change: So I think the coverage started to improve towards the midpoint of last year.
Speaker Change: And still represents an opportunity for us to get the word out that coverage is at better but overall tons of excitement.
Speaker Change: In the field just.
Speaker Change: In Houston.
One estimating and our team has been doing a fantastic job and it's motivated and the customers are responding well.
Speaker Change: I just wanted to add we actually just had also Joe gotten some feedback directly from the field. Yes. There is one physician in New Jersey that was after he had seen some of the new data and the piece that Erik showed.
Speaker Change: A large practice so I'll just give you a real live example, said Wow I should really not be starting in these patients.
Speaker Change: Going from a stat and so has that in mind I shouldn't be going right <unk> that it's almost like the population health management. They are also actually going back now and looking at patients who've been on the stat in for at least six months who've tried and failed and have not taken anything almost complete status failure. If you will and they are.
Speaker Change: Next one is that for these patients as well because to Eric's point, that's what's really unique you can use this as a monotherapy you can use it some combination.
Speaker Change: So that's real life feedback from the field that we're getting now.
Speaker Change: That's actually very helpful feedback I appreciate it and then Mike just a quick question here, probably can't provide too much visibility is I guess can you describe the level of maturity at least with regard to your discussions for potential in licensing.
Speaker Change: Yeah. So we were actually looking at this since last year and as you know Joe We mentioned this at JP Morgan I think it was a small boy and lost upon folks, but where we are right now as we are doing the landscape analysis. We've been looking at products that are either late stage phase II.
Speaker Change: <unk>.
Speaker Change: Soon to be approved are already approved.
Speaker Change: And I would say, we're far along but we wanted to make sure that it's the right product.
Speaker Change: And as you know.
Speaker Change: Yes, I think the one thing that really differentiates us as a company is that we are a company.
Speaker Change: We have medical affairs, we have a sales force we have a compliance department, we have manufacturing a lot of these companies. They don't have the infrastructure and Thats, where we think we can really add value. So we're still looking at these different companies. We wanted to make sure we pick the right one and we will continue to up.
Speaker Change: <unk>, but we're really excited about the fact that we can leverage what we have in order to do this.
Speaker Change: Great I appreciate all the color.
Speaker Change: Thanks, Joe Thanks.
Speaker Change: And the next question will come from Tom Shrader with <unk>. Your line is open.
Tom Shrader: Good morning, I wanted to make sure of what I think I just heard that you think it's attractive to help sell somebody else's product, we've got a big opportunity given there were such a dearth of cardiovascular sales force since right now.
Speaker Change: And then I have a second question for Sheldon that I think you were close to when Merck added a statin.
Speaker Change: Did that drive sales and can you give us a sense of how much. So we can think about what the growth opportunity you have to your next combination is thank you.
Speaker Change: Hey, Tom It's Eric I'll take the first part of that so the answer is yes, and whether that.
Speaker Change: Commercializing someone's compound or whether we're actually.
Speaker Change: Acquiring <unk> and <unk>.
Sheldon Koenig: Asset and the key is we've built a really compelling commercial infrastructure as Sheldon mentioned in addition to other elements of the company.
Sheldon Koenig: Got a team that's proven and their ability to generate 50% year over year growth.
Sheldon Koenig: A team that covers about 20000, HCP is including cardiologists and primary care and has a digital footprint that goes to not only clinicians but patient. So when you think about these companies that have assets in late stage development or under regulatory review maybe just.
Sheldon Koenig: Starting to be commercialized, it's a pretty compelling value proposition for those organizations and for us to be able to infuse additional assets that complement the existing portfolio enables us to be really efficient with that so hopefully that answers your question.
Sheldon Koenig: And let's be honest brings in more money into our company as well if we strike the right deal, which we would regarding combination therapy. So.
Sheldon Koenig: I think what you're referring to Tom is after Victorian Merck actually looked at doing a combination of <unk> with lipitor, which was called <unk> and it was never available in the U S. Because just kind of find out couldn't figure out the right way that package it but in Europe. It was and it did.
Sheldon Koenig: Very well I think poly pill strategy has come a long way since then as a matter of fact.
Sheldon Koenig: The World Health organization and also the World Cardiology Association have both issued guidelines, where similar to where you treat diabetes and hypertension with multiple products, they're recommending and their guidelines that patient start as soon as possible with multiple therapies.
Sheldon Koenig: To manage their LDL cholesterol. So now the fact as we said in our prepared remarks that we have honestly a mono therapy, we have <unk> and soon.
Sheldon Koenig: We'll have a triple combination it allows physicians and patients to have this flexibility to achieve their goals more rapidly but.
Sheldon Koenig: <unk>.
Speaker Change: The reason why Merck pursued it for the same reason, we're pursuing that is because our market research shows that patients.
Sheldon Koenig: And physicians want this.
Speaker Change: Okay. Thank you.
Sheldon Koenig: Yeah.
Jessica Fye: And the next question will come from Jessica Fye with Jpmorgan. Your line is open.
Jessica Fye: Hey, guys. Good morning. This is done on the purchase I have a bunch of questions on these triples. So.
Jessica Fye: First of all why are you starting to pursue these triples just now.
Jessica Fye: And you mentioned in the PR that triple combination products of LDL lowering in excess of 60%. So.
Jessica Fye: What I'm trying to get at.
Jessica Fye: Are there any are there any other ways to differentiate <unk> from other products.
Jessica Fye: Other than the LDL metric.
Jessica Fye: Sure.
Jessica Fye: First let me start with your first question, we view the Triple combination is complementary to our existing portfolio and it definitely supports our path to achieving blockbuster status.
Jessica Fye: With the products that were already commercializing.
Jessica Fye: As it relates to what further differentiates versus just lowering LDL first of all I would say, it's all about lowering LDL. If you look at the guidelines it's about <unk>.
Essentially getting patients in Europe as you know the guidelines show.
Jessica Fye: And who are at.
Jessica Fye: High risk to at least 55 milligrams per deciliter now in the U S. There really isn't a goal and guidelines arent coming out we have heard until 2026, but most cardiologists and primary care physicians use be too they wanted to get patients down to that 55 milligram per deciliter, especially if they're at high risk.
Jessica Fye: But I think the other differentiating factor with our product that drugs like PCF canine and future competition do not have as we also lower Hs CRP and Theres a lot of information out there regarding lowering HFC RP.
Jessica Fye: As you know is a key marker of inflammation also.
Jessica Fye: As you know we have.
Jessica Fye: At least with episodic asset no effect on glucose.
Jessica Fye: So I think that's also important and we think that will also play a role as we move forward in the development of this asset.
Jessica Fye: You might have seen also that we.
Jessica Fye: Submitted a paper recently regarding our effect on those patients who are obese and our efficacy there. So there's a lot of the facts that <unk> asset.
Jessica Fye: In combination with other products in this case, a statin that we think will be very favorable and I can tell you that this is something payers are looking for as well it helps them with their NCQA in heat as quality measures. So theres a lot of aspects of.
What this product would bring in and why we are developing it now.
Jessica Fye: Alright.
Jessica Fye: One more can you also briefly comment on the overall development timelines for these triple products on.
Jessica Fye: How long do you think you'll have exclusivity for them.
Jessica Fye: Yeah, So we're going to speak more around the development timeline in the fall as we mentioned earlier as it relates to patent life, it's too early to say, but.
Jessica Fye: We will have more clarity as development progresses on what this means as it relates to extending our patent life.
Jessica Fye: Alright. Thank.
Jessica Fye: Thanks, so much.
Jason: And the next question comes from Jason <unk> with Bank of America. Your line is open.
Jason: Good morning. Thank you so much for taking our questions and congratulations on the progress I wanted to ask a follow up on some of your earlier comments Sheldon.
Jason: Appreciating.
Speaker Change: The commentary from Kols back in January who mentioned that awareness.
Jason: It may be an issue and I was curious.
Jason: What youre hearing from your sales force from prescribers.
Jason: How familiar are they with <unk> acid.
Jason: Do you expect this to inflict anytime soon if it doesn't.
Jason: Okay.
Jason: And what Youre hearing from.
Jason: Yeah. So on the ground there. Thank you.
Speaker Change: Yeah I'll take this one basin, it's Eric Yeah. So every.
Speaker Change: Quarter or two we do something called <unk>, where we look at the.
Speaker Change: Awareness and we look at the trial, we look at utilization.
Speaker Change: We do it.
Speaker Change: <unk> of HCP.
Speaker Change: Keep score on how we're doing from a progress perspective.
Speaker Change: We look at awareness on two levels, we look at unaided awareness and then we look at aided awareness and I think the bottom line as we've progressively seen improvements.
Our unaided awareness this is Eddie.
Speaker Change: Just asking HCP, what theyre aware of them without giving them any prompt where roughly where one would expect and we asked.
Speaker Change: The <unk> associates for their benchmarks when you look at the aided awareness.
Speaker Change: We're in the 95% range. So the bottom line is the word is getting out on our products.
Speaker Change: The team is doing a great job at reaching the universe that we have our HCP digital is allowing us to broaden that net.
Speaker Change: The efficacy is really what's resonating for us and as I mentioned earlier in the Q&A the opportunity for us and not only is to communicate that efficacy, but also that expanded coverage that we have.
Speaker Change: Got it maybe during the recent healthcare conference Sheldon mentioned that Salesforce was appropriately sized but but is this something that would.
Speaker Change: Benefit from an increased sales force. Thanks.
Sheldon Koenig: Yes, I would say right now we're appropriately sized we continue to evaluate.
Speaker Change: And whether that's changing the size potentially changing some of the composition of the components of the team Sheldon mentioned, our ability to go to it systems for example.
Speaker Change: On his broader utilization so right now our focus is on being efficient.
Speaker Change: <unk> profitability with profitability, which is on the near horizon will be able to potentially pull up their leavers and one other lever I would mentioned Jason is that we have seen that consumers are being activated and.
Speaker Change: I would say Eric team has a lot of initiatives that are geared towards to consumers. We're actually expanding that what we're finding is when consumers ask for the drug they get the drug.
Speaker Change: So.
Speaker Change: It's not just going through the traditional physician pathway, but also using our digital assets to activate consumers.
Speaker Change: And that's going very well.
Speaker Change: Great. Thanks for the color.
Serge Belanger: And the next question will come from Serge Belanger with Needham Your line is open.
Serge Belanger: Hi, good morning.
Speaker Change: I guess first question for Ben.
Speaker Change: The Medicare contract impact in the fourth quarter do you expect that to linger into 2025.
Speaker Change: And then secondly.
Speaker Change: Regarding recent prescription trends.
Speaker Change: I guess midway through one or two here.
Speaker Change: We're seeing low single digit growth.
Speaker Change: Stepped down from <unk>.
Speaker Change: Just curious what is behind that trend is it the typical slowdown in the first quarter.
Speaker Change: Does that portend, a tick down in sales.
Speaker Change: Sequentially from <unk>.
Speaker Change: Yes ill answer that Medicare contract real quick so the short answer is no you would the changes coming in 2025.
Speaker Change: Medicare coverage gap will go away and that sort of seem like I said that seasonality will go away and we will have a much more steady and I would say normalized.
Speaker Change: Gross to net rate over the course of the year. So I think we've seen the worst of it now we do have some additional contracts that came on in January that we that we've talked about.
Speaker Change: However, I think we will see a much more consistent steady and normalized gross to net rate.
Speaker Change: And I can take the Q1 start Serge it's Eric yes. So they are typically starts off a bit slower what are the key reasons is.
Speaker Change: Those deductibles as you are aware.
Speaker Change: Research and patient has too.
Speaker Change: Achieved those before they start getting lower prices for their branded products.
Speaker Change: It impact all branded <unk>.
Speaker Change: <unk> across the industry.
Speaker Change: News as they start to reach that point towards where we are now and March typically is a strong.
Speaker Change: In the quarter.
Speaker Change: So we fully anticipate that mentioned again, we were with the field last week. They are energized, they're motivated coming out of that meeting we continue to hear great stories on the impact that they're having with our customers. So.
Speaker Change: Yes, we continue to expect growth from us in January and February tend to typically be like.
Speaker Change: And the next question will come from Paul Choi with Goldman Sachs. Your line is open.
Paul Choi: Hi, Thank you good morning, and thanks for taking the questions.
Paul Choi: I had a question regarding the Triple development and is this something that both you and your partner in Europe will be doing concurrently or is this a separate development program for <unk>.
Paul Choi: Barry on proprietary Triple and then my second question is for Ben can you just give us maybe the net.
Paul Choi: Interest.
Paul Choi: Impact change based on all the recent financings and just sort of what that annualized is that thank you very much.
Speaker Change: Thanks, Paul I think it's safe to say, we've talked about this before and it's been our 10-K. The Daiichi Sankyo Europe is also developing a triple combination also in the past and also at J P. Morgan more recently I talked about the fact that I think when people think about that but Doug assay. They think about just disappearing.
Speaker Change: We have two other large companies are also heavily invested in this product to your point Daiichi Sankyo, and Otsuka and we've always talked about that it's important for all of us work together.
Speaker Change: To make this product as big as possible and to achieve the blockbuster status, we talked about and you see in the corporate deck.
Speaker Change: How well Daiichi Sankyo continues to do as well as we do so not to make it a long answer but.
Speaker Change: The answer is yes.
Speaker Change: They're doing it we're doing it we're doing it together.
Speaker Change: And Youll hear more about this as we go into the third quarter Ben.
Yes, so to answer your question Paul So I don't have the exact percentage off hand, but I can follow up with you on that one but overall interest expense, we expect to remain roughly consistent with where we were in Q4 going forward I will note that actually the majority of that is kind of a noncash interest.
Speaker Change: Component related to how we account for the <unk> deal.
Speaker Change: So.
Speaker Change: Consistent and large portion of it is really just accounting noise.
Speaker Change: If you look at Q4, I would expect to carry that forward throughout the year.
Speaker Change: Got it thank you very much.
Speaker Change: And the next question comes from Chris Sin Class, Scott with Cantor Fitzgerald. Your line is open.
Speaker Change: Hi, good morning, everybody for the Triple combination studies I know you cite literature in terms of your expectations of a fact, but im curious now that there've been a lot of patients treated in the real world with these therapies, if you're hearing any anecdotes about this being utilized in combination.
Speaker Change: And or if any physicians have ever approached you about the potential of this study such a combination.
Eric: Hi, Kristen, it's Eric Yes, we do have.
Eric: Fair amount of utilization in combination with <unk>.
Eric: And as you know one of the key challenges with that is either.
Eric: Inability to titrate, any eric tolerate any or to tolerate higher doses. So we're hearing clinician that employ lower doses of these high intensity statin atorvastatin and receive is that in.
Eric: And they add in Mexico is that to enhance that efficacy and I think that 60% number that we put forth is as conservative.
Eric: The numbers tend to typically be higher from what we hear but.
Eric: It positions us incredibly well when we think about what clinicians want they want efficacy they want complementary mechanisms and as Sheldon said.
Eric: Combination employed three mechanisms that work together two of them that have proven cardiovascular outcomes and stat and Panther like asset. So, it's a really compelling value proposition, which positions us not only well for patients and our customers, but positions us against the potential call.
Eric: Petition in the future and if I just may add Chris.
Chris: Chris does that we also have a cardiovascular advisory board not too different from what I think our friends.
Chris: Friends in cardiovascular medicine, Amgen, Merck et cetera, do as well we have the top key opinion leaders.
Chris: On the Advisory Board I can tell you. They are very excited about this and what it offers to patients again.
Chris: It really encompasses kind of where medicine is going into the future with this poly pill delivery. It really helps so that adherence and compliance as well so to the latter half of your question. They are very excited about it.
Speaker Change: Okay. Thanks, and just on that note then how would you be thinking about the dosing regimen.
Speaker Change: And just to your point to.
Speaker Change: <unk> balance that you are still getting the added efficacy, but because it's in a combination setting you may allow for lower dosing so that it becomes more tolerable.
Speaker Change: Yeah I think.
Speaker Change: I was giving it all away I think what you just said it makes a lot of sense Kristen so lower doses of high intensity statin <unk> in combination with <unk> and is that to get the best of both worlds outcomes.
Speaker Change: <unk> reduction.
Speaker Change: Obviously safety.
Speaker Change: Sparing those high doses of high intensity statin.
Speaker Change: Thanks very much.
Speaker Change: Thank you.
Sheldon Koenig: I show no further questions at this time I would now like to turn the call back over to Sheldon for closing remarks.
Sheldon Koenig: Thank you operator, and thank you all again for your time and attention. This morning, we are looking forward to our upcoming R&D day on April 24th and hope to have the opportunity to connect with many of you then in the meantime, if you have any questions or would like to have a call with the team just reach out to our head of Investor Relations Aline <unk> have a great day.
Sheldon Koenig: And thank you again.
Sheldon Koenig: This concludes today's conference call. Thank you for participating you may now disconnect.
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