Q2 2025 Esperion Therapeutics Inc Earnings Call
Operator: Hello, ladies and gentlemen, and thank you for standing by. Welcome to Esperion's second quarter 2025 financial results. 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 is being recorded. I would now like to hand the conference over to Alina Venezia, Head of Investor Relations for Esperion Therapeutics. Please go ahead.
Hello, ladies and gentlemen, and thank you for standing by. Welcome to Esperion's second quarter 2025 financial results.
Alina Venezia: Thank you, Operator. Good morning, and welcome to Esperion's second quarter 2025 earnings conference call. With us on today's call are Sheldon Koenig, President and CEO, and Ben Halladay, CFO. Other members of the executive team will be available for Q&A following our prepared remarks. We issued a press release earlier this morning detailing the contents of today's call. A copy can be found on the investor page of our website, together with a copy of the presentation that we will also be referencing. I want to remind callers that the information discussed on today's call is covered under the safe harbor provisions of the Private Securities Litigation Reform Act. I caution listeners that management will be making forward-looking statements. Actual results could differ materially from those stated or implied by our forward-looking statements due to the risks and uncertainties associated with the business.
At this time, all participants are in a listen-only mode for the following. The presentation will be a question-and-answer session. Please be advised that today's conference is being recorded. I would now like to hand the conference over to Alina Venezia, Head of Investor Relations for Esperion Therapeutics. Please go ahead. Thank you. Operator. Good morning and welcome to Esperion's second quarter 2025 earnings conference call.
With us on today's call our Sheldon, kenik, president and CEO and Ben Holladay. CFO. Other members of the executive team will be available for Q&A following our prepared remarks.
We issued a press release earlier this morning detailing the content of today's call.
A copy can be found on the investor page of our website, together with a copy of the presentation that we will also be referencing.
I want to remind callers that the information discussed on today's call is covered under the Safe Harbor. Provisions of the private Securities. Litigation Reform Act, I caution listeners the management will be making forward-looking statements.
Actual results.
Materially.
Through those stated.
Alina Venezia: These forward-looking statements are qualified in their entirety by the cautionary statements contained in today's press release and in our SEC filing. The content of this conference call contains time-sensitive information that is only accurate as of the date of this live broadcast, August 5th, 2025. We undertake no obligation to revise or update any forward-looking statements to reflect events or circumstances as to the date of the conference call and webcast. As a reminder, this conference call and webcast are being recorded and archived. We will begin the call with prepared remarks and then open the lines for your questions. I will now turn the call over to you, Sheldon.
Statements are subject to the risks and uncertainties associated with the business.
This forward-looking statements are qualified in their entirety by the cautionary statements contained in today's press release and in our FTC file,
the content of this content call contains time-sensitive information that is only accurate as of the date of this live broadcast,
August 5th, 2025 we undertake no obligation to revise or update, any forward-looking statements, to reflect events, or circumstances after the date of the conference, call and webcast.
As a reminder, this conference call and webcasts are being recorded and archived. We will begin the call with prepared remarks and then open the line for your questions. I'll now turn the call over to you Sheldon.
Sheldon Koenig: Thank you, Alina. Good morning, everyone, and thank you for joining us. We are thrilled to report a standout second quarter that delivered double-digit sequential growth, more than 42% year-over-year gains in U.S. net product sales, and our first quarter of operating income from ongoing business. These results reflect accelerating clinical adoption of NEXLETOL and NEXLIZET, fueled by our sharpened commercial execution, strong payer alignment, and our ongoing targeted promotional strategy that is resonating with the statin-intolerant community. Total revenue for the second quarter 2025 grew 12% year-over-year to $82.4 million. Looking at our strong U.S. performance, where we saw a return to sequential double-digit quarterly prescription and revenue growth, U.S. net product revenue grew 42% year-over-year to $40.3 million and grew 15% sequentially from the first quarter of 2025.
Thank you, Alina. Good morning, everyone. And thank you for joining us. We're thrilled to report a standout second quarter that delivered double digit, sequential growth more more than 42% year-over-year. Gains in US, net product sales and our first quarter of operating income from ongoing business. These results reflect accelerating clinical
Adoption of nexo and Nexus at fueled by our sharpened commercial execution, strong payer alignment and our ongoing targeted promotional strategy. That's resonating with the Statin intolerant community.
Total revenue for the second quarter of 2025 increased by 12% year-over-year to $82.4 million.
Sheldon Koenig: Given our strong performance, we achieved operating income from ongoing business of approximately $15 million, giving us confidence that with continued global growth, we expect to transition to sustainable profitability beginning in the first quarter of 2026. As we shared on our last call, the endorsement of NEXLETOL and NEXLIZET from leading cardiovascular professional societies was a powerful validation of our science, and it has already translated into action. Later this month, we look forward to the European Society of Cardiology updating their lipid management guidelines at the society's annual meeting, where we expect to be included in these updates. Turning to the progress we made on a number of our core marketing initiatives, including our campaign to reach patients who are statin-intolerant, our tagline, "Can't Take a Statin? Make NEXLIZET Happen" was well received, and this catchy phrase supported increased brand awareness among our target audience.
Looking at our strong U.S. performance, where we saw a return to sequential double-digit quarterly prescription and revenue growth in the U.S. Net product revenue grew 42% year-over-year to $40.3 million and grew 15% sequentially from the first quarter of 2025.
Given our strong performance, we achieved operating income from ongoing business of approximately, 15 million dollars, giving us confidence that with continued Global growth. We expect to transition to sustainable profitability, beginning in the first quarter of 2026.
On our last call the endorsement of Nexa tall necks luzette from leading cardiovascular. Professional societies was a powerful validation of our science and it's already translated into action later this month. We look forward to the European Society of Cardiology updating, their lipid management guidelines at the society's annual meeting where we expect to be included in these updates.
Sheldon Koenig: In fact, during the second quarter alone, we had more than 650,000 visits to our new consumer statin intolerance website and more than 600,000 click-throughs to our physician site, underscoring the impact of this successful campaign. We are implementing the right balance of in-person and digital outreach and are pleased to report that 23%, or nearly one quarter, of our prescriptions were written by physicians with only digital touchpoints. In addition, of prescriptions coming from new writers, 38% were driven by digital-only touchpoints. This highlights the importance of our digital omnichannel programs and underscores the impact they can continue to have. We remain committed to building on these successful programs and are confident in their continued contribution to our growth. Our expanded U.S. field reimbursement manager support team made great strides in supporting our growing prescriber base by educating over 1,100 target prescribers on NEXLETOL and NEXLIZET's favorable reimbursement landscape.
Turning to the progress, we made on the number of our core marketing initiatives, including our campaign to reach patients, who are Statin intolerant. Our tagline can't take a Statin make Nexus that happen was well received and this catchy, phrase supported increased, brand awareness, among our target audience. In fact, during the second quarter alone, we had more than 650,000 visits to our new consumer, Statin, intolerance website, and more than 600,000 click-throughs to our physician site underscoring the impact of the successful campaign.
We are implementing the right balance of in-person and digital outreach, and we are pleased to report that 23%—or nearly one quarter—of our prescriptions were written by physicians with only digital touch points. In addition, of prescriptions coming from new writers, 38% were driven by digital-only touch points. This highlights the importance of our digital omnichannel programs and underscores the impact they can continue to have.
We remain committed to building on the successful programs and are confident in their continued contribution to our growth.
Sheldon Koenig: This was evident by an increase in all targeted prescriber approval rates to over 80%. Combined with further expanded payer coverage, reductions in prior authorization requirements, increased reimbursement support resources, and our appropriate balance of direct and digital marketing efforts, we believe we have significantly improved the access environment for patients and physicians alike, which resulted in a 10% increase in total retail prescription equivalents from this first quarter of 2025 and increased our total prescriber base to more than 28,000 healthcare practitioners. This momentum validates the growing confidence among clinicians and the expanding role of our therapies in addressing the unmet needs of statin-intolerant patients. Our consumer marketing program, featuring the lipid lurkers, tackles the challenge of high cholesterol, a silent but serious threat, by transforming it into mischievous characters that demand attention, which may be quietly lurking without their knowledge.
Our expanded us field reimbursement, manager, support team made, great strides in supporting our growing prescriber Bass by educating over 1100, Target prescribers on nexo and nexo vets favorable reimbursement. Landscape. This was evident by an increase in all targeted, prescriber approval rates over 80%,
Combined with further expanded payer coverage reductions in prior, authorization requirements, increase reimbursement, support resources, and our appropriate balance of direct and digital marketing efforts. We believe we have significantly improved the access environment for patients and Physicians alike.
Which resulted in a 10% increase in total, retail prescription equivalents from the first quarter of 2025 and increase. Our total prescriber base to more than 28,000 Healthcare practitioners.
This momentum validates, the growing confidence among clinicians and the expanding role of our Therapies in addressing the unmet needs of Statin intolerant patients.
Sheldon Koenig: Rather than relying on fear tactics, the lurkers personify LDL cholesterol's hidden dangers, making the risk tangible and manageable without intimidation. This fresh, compelling approach reshapes how patients perceive and address their cardiovascular risk. By blending engagement with patient empowerment, the campaign stood out in a crowded market, driving awareness and action for proactive cholesterol management with NEXLETOL and NEXLIZET, the next step after statins. This campaign has won the prestigious MedAdNews Best Consumer Digital campaign and is nominated for several more awards this year. Moving forward, we plan to launch a consumer television ad later in the year that will stream on connected TV, such as Hulu and NBC Sports. These branded ads are expected to broaden awareness of statin intolerance and will feature our award-winning lipid lurkers.
Our consumer marketing program featuring The lipid lurkers, tackles the challenge of high cholesterol, a silent but serious threat by transforming it into mischievous characters that demand attention which may be quietly lurking without their knowledge. Rather than relying on fear tactics, the lurkers personify LDL cholesterols hidden dangers, making the most tangible and manageable without intimidation
This fresh, compelling approach reshapes how patients perceive and address their cardiovascular risk.
By blending engagement with patient empowerment, the campaign stood out in a crowded market, driving awareness and action for proactive cholesterol management with Nexletol and Nexlizet as the next steps after statins.
This campaign has won. The prestigious Med ad news, best consumer, digital campaign, and is nominated for several more Awards this year.
Moving forward, we plan to launch a consumer television ad later in the year that will stream on connected TV such as Hulu and NBC Sports.
Sheldon Koenig: The combined strength of the statin intolerance and lipid lurkers campaign, coupled with improving payer dynamics, supports our continued growth now and into the future. Speaking of future growth, we remain committed to Esperion's continued growth in cardiovascular risk reduction with our plans to develop a triple combination product. This therapy has the potential to be the most effective oral LDL cholesterol-lowering option and to rival both existing injectables and emerging oral therapies. Development remains on track. In addition, our business development efforts are progressing nicely as we evaluate a number of potential opportunities to in-license or acquire synergistic products to leverage our existing commercial infrastructure. We look forward to updating you on progress here as it unfolds. Additionally, we reached important settlement agreements with three generic manufacturers. Three generic manufacturers have agreed not to market a generic version of NEXLETOL in the United States prior to 2040.
These branded ads are expected to broaden awareness of statin intolerance and will feature our award-winning lipid lurkers.
The combined strength of the Statin intolerance and lipid, lurkers campaign, coupled with improving payer Dynamics support. Our continued growth now and into the future.
Speaking of future growth, we remain committed to experiencing continued growth and cardiovascular risk reduction with our plans to develop a triple combination product.
This therapy has the potential to be the most effective. Oral LDL cholesterol lowering option and to rival both existing injectables and emerging oral Therapies.
Development remains on track. In addition, our business development efforts are progressing nicely as we evaluate a number of potential opportunities to in-licensed or acquire synergistic products to leverage our existing commercial infrastructure.
We look forward to updating you on progress here as it unfolds.
Additional additionally, we reached important settlement agreements with 3, nexl tall.
Sheldon Koenig: We continue to identify opportunities to strengthen our intellectual property position and look forward to updating you on our progress. Turning to our pipeline, where our strategy is to expand into high-need, high-value indications that highlight the broader potential of our novel ACLY pipeline, we continue to make progress advancing IND-enabling studies to support our recently introduced program targeting primary sclerosing cholangitis, known as PSC. PSC is a rare progressive liver disease with no approved therapies and represents a major unmet need with an estimated $1 billion annual market opportunity. We look forward to completing these studies and to filing an IND and potentially initiating first-in-human studies in the second half of 2026. Throughout the second quarter, we and our international partners continue to make tremendous progress across a number of key geographies.
Three generic manufacturers have agreed not to market a generic version of Nexletol in the United States prior to 2040. We continue to identify opportunities to strengthen our intellectual property position and look forward to updating you on our progress.
Turning to our pipeline where our strategy is to expand into high-need. High-value indications, that highlight the broader potential of our novel. Acli biology. We continue to make progress advancing, IND, enabling studies to support our recently introduced program targeting primary sclerosing cholangitis known as PSC. PSC is a rare Progressive liver disease with no approved therapies and represents a major unmet need with an estimated 1 billion dollar annual Market opportunity.
We look forward to completing these studies and to filing an IND and potentially initiating first in human studies, in the second half of 2026.
Sheldon Koenig: Our European partner, Daiichi Sankyo Europe, continues to expand their reach of NILEMDO and NUSTENDI to benefit patients at the risk of cardiovascular disease who cannot manage their LDL cholesterol levels. Our royalty revenue from Daiichi Sankyo Europe increased 30% from the first quarter of 2025 to $13.6 million in the second quarter of 2025. We are also thrilled to report that Daiichi Sankyo Europe has surpassed the 500,000 patient mark for patients who have been treated with our therapies in Europe, half a million patients. This is a meaningful milestone that reinforces confidence in our ability to build a similarly sized market in the U.S. Throughout the first half of the year, we continue to advance multiple processes for the technology transfer for manufacturing of NILEMDO and NUSTENDI to Daiichi Sankyo Europe with the various working capital benefits expected in 2025.
Throughout the second quarter, we and our international partners continue to make tremendous progress across a number of key geographies.
Our European partner diti Sanko, Europe continues to expand their reach of nmo and knee to benefit patients at the risk of cardiovascular disease. Who cannot manage their LDL cholesterol levels.
Our royalty revenue from DSC increased 30% from the first quarter of 2025 to 13.6 million. In the second quarter of 2025.
We are also thrilled to report that DSC has surpassed the 500,000 patient Mark for patients, who have been treated with our Therapies in Europe.
Half a million patients, this is a meaningful Milestone that reinforces confidence in our ability to build a similarly sized Market in the US.
Sheldon Koenig: Our Japanese partner, Otsuka Pharmaceuticals, submitted for approval of our bempedoic acid products in Japan for LDL cholesterol lowering and remains on track for approval and national health insurance pricing in the second half of 2025. Upon this achievement, we expect to receive milestone payments of up to $120 million. The Japanese market is the world's third-largest cardiovascular prevention market, and we believe the royalties on Japanese product sales will be a major revenue contributor over time. Building on our global progress, we expanded our international reach through a commercial partnership with Esperion Therapeutics, giving them the exclusive rights to commercialize NEXLETOL and NEXLIZET in Canada. Our previously filed new drug submissions to Health Canada are on track for review, and we continue to expect market approval in the fourth quarter of 2025.
Throughout the first half of the year, we continue to advance multiple processes for the technology transfer for manufacturing of the limbo Andy to DSC, with various working capital benefits expected in 2025.
Our Japanese partner otsuka, pharmaceutical submitted for approval of our pick acid products, in Japan for LDL cholesterol, lowering and remain on track for approval and national health. Insurance pricing in the second half of 2025,
Upon this achievement, we expect to receive milestone payments of up to $120 million.
The Japanese Market is the world's third largest cardiovascular prevention market, and we believe the royalties on Japanese product sales will be a major Revenue contributor over time.
Building on our Global progress, we expanded our International reach through a commercial partnership with hls, Therapeutics giving them the exclusive rights to commercialize nexo and nexo set in Canada.
Sheldon Koenig: Our partner in Israel, Neopharm Israel, remains on track for market approval of NEXLETOL and NEXLIZET in the first half of 2026. CSL Seqirus, our partner in Australia and New Zealand, filed a marketing application in Australia for NEXLETOL and NEXLIZET in July 2025 and expects market approval in Q4 2026. The progress with these international partnerships is expected to deliver a consistent cadence of approvals and product launches over the coming months and year that will also provide a growing royalty stream and milestone payments, all of which support our strategic focus to drive revenue growth and profitability. With that overview of the business, let me turn the call over to Ben for a detailed review of our financial progress during the second quarter. Ben?
Our previously filed, new drug submissions to health Canada are on track for review and we continue to expect Market approval in the fourth quarter of 2025.
Our partner in Israel neoarchean.
The progress with these international partnerships is expected to deliver a consistent cadence of approvals and product launches over the coming months and year. That will also provide a growing royalty stream and milestone payments, all of which support our strategic focus to drive revenue growth and profitability.
Ben Halladay: Thank you, Sheldon. Good morning, everyone, and thank you for joining us. I am extremely excited and proud to share our financial results today. Our second quarter 2025 financial results can be found in the press release we issued this morning, and more detail will be included in our upcoming 10Q. As you have heard Sheldon discuss, we had an exceptional second quarter highlighted by our first quarter of operating income from ongoing business in the company's history, which sets us up nicely and supports our plans to transition to sustainable profitability starting in the first quarter of 2026. We are proud of the progress we have made, and it underscores our long-held assertion that incremental growth, when compounded and expanded, will drop to the bottom line. Over time, this gives us considerable leverage as we move forward with confidence.
With that overview of the business. Let me turn the call over to Ben for a detailed review of our financial progress. During the second quarter been
Thank you, Sheldon. Good morning, everyone. And thank you for joining us. I'm extremely excited and proud to share our financial results today. Our second quarter 2025 Financial results can be found in the press release. We issued this morning and more detail will be included in our upcoming 10q.
As you've heard Sheldon discuss. We had an exceptional second quarter. Highlighted by our first quarter of operating income from ongoing business, in the company's history, which sets us up nicely and supports our plans to transition to sustainable profitability starting in the first quarter of 2026.
Ben Halladay: Turning now to the financial results, second quarter 2025 total revenue was $82.4 million, up 12% from the comparable period in 2024. Note this impressive growth was achieved even when compared to second quarter 2024, during which we received a $25 million one-time milestone payment, further highlighting the strength of our underlying business. U.S. net product revenue was $40.3 million compared to $28.3 million for the comparable period in 2024, an increase of approximately 42%. Sequential quarterly net revenue growth was 15%. Collaboration revenue was $42.1 million compared to $45.5 million for the comparable period in 2024, a decrease of approximately 7%, driven by the settlement agreement milestone with Daiichi Sankyo Europe received in the three months ended June 30, 2024, offset partially by increases in royalty sales with our partner territories and product sales to our collaboration partners from our supply agreements.
We are proud of the progress we've made and it underscores our long-held assertion that incremental growth. When compounded and expanded will drop to the bottom line over time. This gives us considerable leverage as we move forward with confidence.
Business.
Us. Net product, Revenue was 40.3 Million compared to 28.3 million for the comparable period in 2024, an increase of approximately 42%.
Sequential quarterly, net revenue. Growth was 15%.
Ben Halladay: Excluding the settlement agreement milestone, collaboration revenue grew 105% from the comparable period. Turning to the rest of the P&L, for the second quarter 2025, research and development expenses were $7.2 million compared to $11.5 million for the comparable period of 2024, a decrease of 37%. Selling, general and administrative expenses were $39.5 million compared to $44.2 million for the comparable period in 2024, a decrease of 11%. The decrease quarter over quarter was primarily related to decreased media and marketing costs. We are reiterating our full-year 2025 operating expense guidance, which is expected to be approximately $215 million to $235 million, including $15 million in non-cash expenses related to stock compensation. We are on our way to transitioning to sustainable profitability starting in the first quarter of 2026, and our operating income from ongoing business in the second quarter validates those expectations.
Collaboration Revenue was 42.1 Million compared to 45.5 million for the comparable period. In 2024, a decrease of approximately 7% driven by the settlement agreement. Milestone with DSC received in the 3 months, ended June 30th 2024 offset partially by increases in royalty sales with our partner, territories and product sales to our collaboration Partners from our supply agreements.
Excluding the settlement agreement, Milestone collaboration Revenue, Grew 105% From the comparable period.
Turning to the rest of the p&l. For the second quarter, 2025 research and development. Expenses were 7.2 million compared to 11.5 million for the comparable period of 2024, a decrease of 37%
selling General and administrative expenses for 39.5 million compared to 44.2 million for the comparable period. In 2024, a decrease of 11%
The decreased quarter of a quarter was primarily related to decreased media and marketing costs.
We are reiterating our full year 2025 operating expense guidance, which is expected to be approximately 215 million to 235 million, including 15 million, in non-cash, expenses related to stock compensation.
Ben Halladay: We ended the quarter with cash and cash equivalents of $86.1 million, which, combined with our excellent operational results and continued global growth, well positions us to create value and achieve our goals. With that, I will now turn the call back over to Sheldon for closing remarks. Sheldon?
We are on our way to transitioning to sustainable profitability starting in the first quarter of 2026, and our operating income from ongoing business in the second quarter validates those expectations. We ended the quarter with cash and cash equivalents of $86.1 million, which, combined with our excellent operational results and continued global growth, well positions us to create value and achieve our goals.
Sheldon Koenig: Thank you, Ben. As you have heard today, we have yet again delivered strong results and are executing with precision and building meaningful momentum across every dimension of our business, from commercial performance and clinical adoption to global expansion and pipeline innovation. We are not just growing; we are transforming the landscape of cardiovascular disease prevention for underserved patients. With NEXLETOL and NEXLIZET, we are delivering real-world impact, and with every new prescriber, every new patient reached, and every new market entered, we are advancing our mission to reduce cardiovascular risk on a global scale. Looking ahead, we are energized by the opportunities in front of us. Our international partnerships are poised to unlock new revenue streams, and our pipeline is expanding into high-value areas of unmet need with the potential to shape the future of care.
With that, I will now turn the call back over to Sheldon for closing remarks. Sheldon.
Thank you, been as you've heard today, we have yet again delivered strong results in our executing with precision and building meaningful momentum across every dimension of our business from commercial performance and clinical adoption to Global expansion and pipeline innovation.
We are not just growing. We are transforming the landscape of cardiovascular disease, prevention for underserved patients with nexo and Nexus at, we are delivering real world impact. And with every new prescriber, every new patient reached and every you Market entered, we are advancing our mission to reduce cardiovascular risk on the global scale.
Sheldon Koenig: When you combine all these factors with diligent expense management, we are on a path to sustainable profitability beginning in the first quarter of 2026 and remain deeply committed to creating long-term value for our shareholders, our partners, and most importantly, for the patients we serve. Thank you for your continued support and belief in our vision. We look forward to updating you on our continued progress next quarter. At this time, we are ready for questions.
Looking ahead, we are energized by the opportunities in front of us. Our International Partnerships are poised to unlock new, revenue streams, and our pipeline is expanding into high-value areas of unmet, need with the potential to shape the future of care.
when you combine all these factors with diligent expense management, we are on the path to sustainable profitability, beginning in the first quarter of 2026, and remain deeply, committed to creating long-term value for our shareholders, our partners, and most importantly, for the patients, we serve,
Thank you for your continued support and belief in our vision. We look forward to updating you on our continued progress next quarter.
Operator: Thank you so much. As a reminder to ask a question, press star 11 on your telephone and wait for your name to be announced. To remove yourself, press star 11 again. One moment for our first question. That comes from Serge Belanger with Needham. Please proceed.
At this time, we are ready for questions.
Thank you so much. And as a reminder, to ask a question, press star, 1 1 1 on your telephone and wait for your name to be announced to remove yourself, press star 1 again, 1 moment for our first question.
That comes from search Bellinger with medium. Please proceed.
Serge Belanger: Hi, good morning, and congrats on the progress this quarter. A couple of quick questions on NEXLETOL and NEXLIZET. Can you remind us how many remaining prior auths are relative to the TAM for the product? I think you mentioned you had over 80% approval rates for these prior auths. Is that a number you expect to continue improving on? Secondly, for Ben, I think you mentioned you expect some of the working capital benefits from the tech transfer to Daiichi Sankyo Europe to start occurring later this year. Just curious what that will look like on the balance sheet when it starts coming together. Thank you.
Hey, good morning and congrats on on the progress, this quarter. Um, a couple quick questions on, um,
Next call. Max was it um can you remind us how many remaining prior Arts are relative to the tan for the the product? And I think you mentioned, you had over 80% approval rates for these prior Arts. So is that a number you expect to to continue improving on
Sheldon Koenig: Great. BJ?
And secondly, for for been, I think you mentioned, you expect some some of the working capital benefits from the tech transfer to DSC to start a career in later. Uh, this year, just curious what that will look like uh on the balance sheet when it starts um coming together. Thank you.
Betty Jean Swartz: Yeah, Serge, how are you? As far as the approval rates, as Sheldon Koenig had mentioned, in less than 60 days with the new field reimbursement team, they've hit 1,100 targets in those 60 days, and we're showing rates well over 80%. We have certain pay setter regions that are even higher than 80%. As you know, with our approval rates like CVS, where we had our prior authorizations removed, we've hit an all-time high there at hitting 93% approval rates there, Aetna 94%, and overall, we're well over 80%. We have the certain key places where we've negotiated those prior authorizations and improved that criteria. We're at 92 million lives updated, or 192 million lives, excuse me, aligned to our new label, and we continue to just see these approvals increasing day after day.
Um, but as, you know, with our approval rates, um, like CVS, where we had our prior authorizations removed, we've hit an all-time high there at, um, hitting 93% approval rates there Aetna, 94% and overall, we're well over 80%, but we have this certain key places where we've negotiated those prior authorizations, really and improved that um, criteria. We're at 92 million uh lives updated, our 192 Million Lives, excuse me. Um aligned to our new label and we continue to just see these approvals increasing day after day.
Ben Halladay: Thanks, Serge. This is Ben. Thanks for the question. On the working capital side, you know this is just in line with what we've been emphasizing on the importance from the tech transfer, right? We have a long time, long production timeline with our product. As Daiichi Sankyo Europe takes over, we will start to ramp down inventory production on our side, which we expect to happen towards the second half of this year. So inventory will come down as we start working through that backlog, and they will start ramping up in 2026.
Thanks search. Uh, this is Ben. Thanks for the question on the working capital side. You know this is just in line with what we've been emphasizing on the importance from the tech transfer, right. We have a long time, long production timeline with our product and so, as DSC takes over, we will start to ramp down, inventory production on our side, which we expect to happen towards the second half of this year. Um, so I would inventory will come down as we start working through that backlog and they will start ramping up in 2026.
Serge Belanger: Thank you.
Operator: Thank you. Our next question is from Kristen Kluska with Cantor Fitzgerald. Please proceed.
Thank you.
Kristen Kluska: Hi, good morning. Congrats on a strong quarter. If I look at the graph on slide 10 where you talk about the growth, it looks like the jump from April to May was probably the largest numerical gain in the two and a half years. I know you talked about several growth levers, but what in particular really stood out during that transition time?
Thank you. Our next question is from Kristen Kloska with Cantor Fitzgerald. Please proceed.
Hi. Good morning. Congrats on a strong quarter. So if I look at the graph on slide 10, where you talk about the growth, can you? It looks like the jump from April to May was probably the largest numerical gain in the two and a half years. So if you can, I know you talked about several growth levers, but what in particular really stood out during that transition time?
Sheldon Koenig: Thanks, Kristen. I think really for us, it has really been our strategy. We have talked a lot today about going after statin-intolerant patients and really establishing this beachhead, which has really continued to drive growth and create a significant amount of awareness. I think what you have heard today also is our plans as we move forward. You heard our tagline, "Can't Take a Statin? Make NEXLIZET Happen." We have representatives out there that are promoting that. We have a lot of material that shows that, asking the question, "Can you take a statin?" To me, I think that is what is really continuing to drive the growth. I also have Lisa Schafer, who is our Head of Marketing in the U.S., also provide some comments.
Betty Jean Swartz: Yep, absolutely. We see the strong growth both from Medicare and commercial, which was really great, and also with primary care physicians and cardiologists. So it really was just sustained growth quarter over quarter. But the out-of-pocket expense for Medicare patients has really improved in the second quarter as they reach that deductible. So that really will be tailwinds for the rest of the year as well.
Uh, thanks Kristen, I think really for us it's really been our strategy. You know we've talked a lot today about going after satin intolerant patients and really establishing this beach head which is really continued um, to to drive growth and create um, a significant amount of awareness. I think what you've heard today also is our plans, as we move forward, you know, you heard our tagline. Can't take a stat and make Nexus that happen. We've got Representatives out there that are promoting that we have a lot of material that shows that, you know, asking the question, can you take a Statin? Um, so, you know, to me, I think that's what's really continuing to, to continue to, to drive the growth also have, uh, Lisa Shaffer, who is our, um, head of marketing in the US also provides some comments. Yep, absolutely. And we see the strong growth, um,
Both from Medicare, uh, which was, uh, Medicare and Commercial, which was really great. And also with, uh, primary care, physicians and cardiologists. So, it really was just sustained growth quarter over quarter. Uh, but the out-of-pocket expense for Medicare patients has really improved in the second quarter as they reached that deductible. So, um, that really will be Tailwind for the rest of the year as well.
Kristen Kluska: Okay, thanks for that. With the growth of the new prescribers that are coming on board, is the number one selling point essentially that they have an option for these statin-intolerant patients? I guess what would you rank maybe as the number two and number three selling points then? Primary prevention, secondary, or anything else in particular that's really standing out as the other two selling points? Thanks so much again.
Betty Jean Swartz: Yes, absolutely. The fact that NEXLETOL and NEXLIZET are the only products indicated for reducing CV events in primary prevention is a very strong selling point. In addition, the only products that have the CV risk reduction, as you mentioned, in statin-intolerant patients, no other product now or in the future is studying that population for CV risk reduction. Those are really the strongest points that we have. Sheldon, anything to add to that?
Okay, thanks for that. So, with the growth of the new prescribers that are coming on board is the number 1 selling point, essentially, that they have an option for these satin tolerant patients. Uh, I guess, what would you rank? Maybe as the number 2. And number 3, selling points, then, uh, primary prevention, secondary, or anything else in particular that's really standing out as the other 2 selling points. Thanks so much again.
Yes, absolutely. So the fact that nexo tall and nexo is that are the only products indicated for uh, reducing CV events in primary prevention is uh, very strong selling point. In addition of the only products that have the CV birth reduction, as you mentioned in Staten and tolerant patients, no! Other product now, or in the future is studying that population for CV risk reduction. So those are really, uh, the strongest, uh, points, uh, that we have.
Serge Belanger: Thanks.
Sheldon anything now, thanks.
Operator: One moment for our next question, please. It comes from Dennis Ding with Jefferies. Please proceed.
1 moment for our next question, please.
Any comes from Dennis? Ding with Jeffries, please proceed.
Kristen Kluska: Hi, good morning. This is Georgia on for Dennis Ding. Thanks for taking our questions. Two questions from us. The first is, how do you view consensus U.S. revenue for the year, which is around 170, and the underlying script growth required to get there? When will you consider giving revenue guidance? Our second question is, can you remind us on the cadence of milestone payments from Otsuka Pharmaceuticals, and are there very simple thresholds that need to be met, and the contract language is very clear? Can you reiterate that there won't be any confusion like we saw from Daiichi Sankyo Europe a few years ago? Thanks.
Uh, good morning. This is Georgia on for
Questions, uh, 2 questions from us. The first is, how do you consensus, uh, us revenue for the year, which is around 170 and the underlying script growth required to get there.
When will you consider giving Revenue guidance?
Ben Halladay: Yeah, hi. Thanks for the question. I will take those in two parts. On the consensus side, yes, I think you can see that we are tracking nicely and in line. I think this was a good quarter in terms of beating consensus, and you know we are tracking well ahead of where we would want to be for that. On the milestone side, I will reiterate we have milestones in the second half with the Japanese regulatory process, which is up to $120 million in milestone payments. We expect those to come, like I said, in the second half of the year. You know we are confident we are going to achieve that full amount based on the contract language. There are tiers and thresholds associated with it, but looking and knowing what those are, I think we are in good shape to maximize the potential for those milestones.
From Asuka, are there very simple thresholds that need to be met? And the contract language is very clear. Could you reiterate that there won't be any confusion, like we saw from Daichi a few years ago? Thanks.
Yeah, hi, thanks for the question. Um, I'll take those in two parts. So, on the consensus side, yes, I think you can see that we're tracking nicely and in line. I think this was a good quarter in terms of beating consensus, and you know, we're tracking well ahead of where we would want to be for that. Um, on the milestone side, I'll reiterate we have milestones in the second half with the Japanese regulatory process, which is up to $120 million in milestone payments. We expect those to come, like I said, in the second half of the year. Um, you know, we're confident we're going to achieve that full amount based on the contract language. There are tiers and thresholds associated with it, but looking and knowing what those are, I think we are in good shape to maximize the potential for those milestones.
Kristen Kluska: Okay, thank you. On the underlying script growth required to get there for the consensus, which is around 170?
Okay, thank you and and on on the underlying script growth required to get there.
For the consensus, which is around $170.
Sheldon Koenig: We're not, I mean, we, you know, we haven't really disclosed what we're doing. It falls in line with guidance. We haven't really given the financial guidance. We're not giving script guidance. I think what's important is to show, and something we've talked about before, is that we will continue to demonstrate double-digit script growth, which we've done again this quarter with over 10% script growth. We're confident that that momentum will continue.
Kristen Kluska: Okay, thank you so much. Congratulations again.
We're not, I mean, we, you know, Georgia where we haven't really disclosed what we're doing it, it falls in line with guidance, we haven't really given the financial guidance. We're not giving script guidance, but I think what's important is to show and something we've talked about before is that we will continue to demonstrate, uh, you know, double digit, script growth, which we've done again, this quarter with over 10%, 10% script growth. And uh, we're confident that that momentum will continue.
Sheldon Koenig: Thanks.
Okay, thank you so much. Congratulations, again.
Operator: Thank you. Our next question is from Jessica Fye with JPMorgan. Please proceed.
Thanks.
Serge Belanger: Hey, guys, good morning. I have several questions this morning, mostly about the model and then kind of a bigger picture question. First, can you talk about the gross margin trend we should expect in the back half of the year and into 2026? I guess I had thought it would kind of start to materialize, but maybe not. So I am just curious kind of how to think about the back half and then next year, and frankly, ultimately where you land. How should we think about gross to nets over the rest of this year? It looks like R&D, particularly after this quarter, is tracking below the 2025 R&D guidance. Should we expect a significant ramp-up in R&D in the back half to kind of get you into that range? Those are the model questions.
Thank you. Our next question is from Jessica fee with JP Morgan, please proceed.
Hey, guys. Good morning. I have several questions this morning, uh, mostly about the model and then kind of a bigger picture question. Um, first, can you talk about the gross margin Trend? We should expect in the back half of the year and into 26, I guess I had thought it would kind of start the materialized but maybe not. So, just curious kind of how to think about the back half. And then next year, um, and frankly ultimately where you land, um, how should we think about gross to nests over the rest of this year? And then, it looks like R&D, particularly after this quarter is tracking below the 2025 R&D guidance. Should we expect a significant ramp up in R&D in the back half to kind of get you into that range?
Serge Belanger: The last one is just basically wanted to ask you to kind of make the case here that NEXLETOL will remain competitive in the non-statin LDL space with additional oral mechanisms coming to market. Thank you.
So those are the model questions. And then the last one is just, um,
Basically, I want to ask you to kind of make the case here that Nexus Hall will remain competitive in the non-statin LDL space with additional oral mechanisms coming to market. Thank you.
Ben Halladay: Thanks, Jess. I will handle the very exciting model questions first and then turn it over to Sheldon for the competitor side. Looking at the model, I think going in order of what you asked about, on the gross margin side, the true benefits from the tech transfer will kick in, I think, early next year. This quarter was good. It was a good gross margin. I think it was largely in part due to the revenue mix as well as some of the underlying movement of materials that we had. I think it is indicative of what we can expect once the tech transfer kicks in place and the beneficial margins we would see there.
Ben Halladay: On gross to net, I think we are in a steady state at this point. We have seen two quarters of what a post-IRA gross to net would look like and the lack of the Medicare coverage gap. Frankly, it has been a huge tailwind for us over the course of this year. We will not see that kind of compounding factor of gross to nets worsening over the course of the year. We will keep seeing the steady, favorable gross to net, which you have seen so far in Q1 and Q2. On the R&D side, Q2 was light, but I think that is mostly just a timing thing. We have our pediatric trial, which is beginning to ramp up, and you will see in the second half, I would not use the word significant ramp-up.
Thanks, Jess. I will handle the very exciting model questions first and then turn it over to Sheldon for the competitor side. So, uh, looking at the model I think kind of going in order of what you asked about on the gross margin side, the true benefits from the tech transfer will kick in I think early next year. Um, you know, this quarter was was good, it was a good gross margin. I think it was largely in part due to the revenue mix as well as some of the underlying movement of materials that we had. But I think it's indicative of what we can expect. Once the tech transfer kicks in place and the beneficial margins. We would see there.
On Gross to net. I think we're in steady state at this point. We've seen 2 quarters of what a post Ira gross net would look like and the lack of the Medicare coverage Gap. Uh, and frankly, it's been a huge Tailwind for us over the course of this year. So we will not see that kind of compounding factor of gross in its worsening over the course of the year. And, you know, we will keep seeing this steady favorable gross to net, which you've seen so far in q1. And Q2 on the R&D side, um, you Q2 was light, but I think that's mostly just a timing thing. We have our pediatric trial, which is beginning to ramp up.
Ben Halladay: R&D still remains pretty minimal in the grand scope of our spend, but you will see an increase compared to Q2 as that pediatric trial starts to ramp up in the second half of the year.
Sheldon Koenig: Great, thanks, Ben. Hey, Jess. Let me address your question as it relates to NEXLETOL and NEXLIZET being competitive into the future, and I will segment this in two ways. We do these live now, and actually, our computers were updating while I was actually reading the script. I want to reiterate one part of it, and that is from an IP perspective, we have already mentioned that we have had three of the antifilers settled to 2040. That is important because, as you know, our baseline projections were always June of 2031, and we have started to actually plan beyond that. We are very confident, as we stated before, about our patent. From a future perspective, that is going to allow us to continue to grow these products for a number of years. That is one aspect.
Up and you'll see in the second half. I would not use the word significant ramp up. Um, R&D Still Remains pretty minimal in the grand scope of our spend, but you will see an increase compared to Q2 as that pediatric, trial starts to ramp up in the second half of the year.
Sheldon Koenig: The second aspect is more about what do we have today? We are on the market today. We are the only product that has studied statin-intolerant patients. We are the only product that also has, as Lisa mentioned, an indication in primary prevention. No other future product is actually doing an outcome study, whether that be oral PCSK9 or CETP inhibition in primary prevention. Let us also not forget there have been four CETP inhibitors that have failed previously, and it remains to be seen what happens with the CETP that is in development. We are very confident based upon where we stand. Really, a summary of what we did today from a reimbursement perspective, how we have been able to drive growth, physicians becoming more aware of this product. You know, very bright future ahead.
Sheldon Koenig: I have always said when this product becomes generic, it is going to be the most utilized generic product ever in lipid lowering. Our mission is to make that goal now.
So you know we're very confident as we stated before about our patent and so from a future perspective that's going to allow us to continue to grow these products for a number of years. That's 1 aspect, but the second aspect is more about what do we have today? We're on the market today, we are the only product that has studied Statin intolerant, patients. We are the only product that also has, as Lisa mentioned, an indication in primary prevention. No, other future product is actually doing outcomes study, whether that be oral pcsk9 or cetp inhibition, in primary prevention. Let's also not forget. There have been 4, CP Inhibitors that have failed previously and it remains to be seen what happens with the cetp that's in development. So we're very confident based upon where we stand really a summary of what we did today from a reimbursement perspective. How we've been able to drive growth Physicians becoming more aware of this product. Um so you know
Very bright future ahead. And um, you know, I've always said when this product becomes generic, it's going to be the most utilized, generic product ever in lipid lowering. Our mission is to make that
That goal now.
Operator: Thank you. One moment for our next question. That comes from Jason Zemansky with Bank of America. Please proceed.
Serge Belanger: Good morning. Congrats on the quarter, and thanks so much for taking our question. I guess, Sheldon, maybe for you, at a high level, we appreciate it is still early days in the launch, and we are certainly not overlooking the progress to date. But you have talked about the potential of bempedoic acid reaching blockbuster status and sort of comparing where we are. We are curious, what gets you there, and when should we expect the inflection to occur, particularly given the potential of competitive oral non-statin agents entering and additional potential headwinds, including reductions in Medicare and Medicaid spend and so forth.
Thank you. One moment for our next question. That comes from Jason Szymanski with Bank of America. Please proceed.
Sheldon Koenig: First of all, it kind of goes back to slide 10 of the presentation. We have seen an inflection. This is a big market. This is a TAM of 70 million patients. This is not like an orphan rare oncology product where you see this hockey stick takeoff. It is something that, a market that will continue to grow, and you will continue to see the growth in our product. We are very happy in where we stand. The fact that we have been able to provide double-digit growth in basically every single metric that you look at, we think that, to your point, early in the launch, we have got a long way to go. We are just starting, and we are seeing tremendous gains. As we mentioned today, Europe is a great bellwether as well, as we continue to maximize our label from the clear outcome study.
Good morning. Congrats on the quarter and thanks so much for taking our question. I guess Sheldon maybe for you at a high level. We appreciate it still early days in the launch. And and we're certainly not overlooking the progress to date. But you've talked about the potential of of Bic acid reaching Blockbuster status and sort of comparing where we are. We're curious, you know, what gets you there and and when should we expect expect the the inflection to occur, you know, particularly given um you know, the potential of uh competitive uh oral non-statin agents entering and um additional potential headwinds including uh reductions in in Medicare Medicaid spend and and so forth.
Yeah. So uh, first of all, you know, it kind of goes back to slide 10 of the presentation. You know, we've, we've seen an inflection. This is a big Market. This is a tam of 70 million patients. This isn't like an orphan rare or you know, as you know oncology project, where you see this hockey stick take off. It's something that, you know, a market that will continue to grow. And you'll continue to see the growth in our product. We're very happy and where we stand. Uh, the fact that we've been able to provide, you know, double digit growth and basically, every single metric that you look at, uh, we think that to your point early in the launch. We've got a long way to go.
Sheldon Koenig: As you know, Jason Zemansky, we have not given guidance of when we will be at certain points. But I think you can see by our ongoing successful quarters, we are going to get there. As it relates to future competition, as I mentioned previously, we really need to see what the outcomes data shows for these products, and they are a long way off. So I would actually ask you to ask them how they think that will look versus us in the future. Thank you.
We're just starting and we're seeing tremendous gains as we mentioned today, Europe is a great bellweather as well. Um, as we continue to maximize our label from the clear outcome study, as you know, you know Jason. We haven't given guidance of you know, when will be at certain points. Um, but I think you can see by our ongoing successful quarters. You know, we're going to get there as it relates to Future competition. As I mentioned previously, you know we really need to see what the outcomes data shows for these products and you know, there are there are a long way off. So I would actually ask you to ask them how they think that will look versus us in the future. Thank you.
Operator: To ask a question, simply press star 11 to get in the queue. We have a question from Joseph Pantginis with H.C. Wainwright. Please proceed.
And as a reminder to ask a question, simply press star, 1 1 1 to get in the queue.
Joseph Pantginis: Hey, everybody. Good morning. Thanks for taking the questions. I have two, please. First, on the back end, with regard to ACLY pipeline and your plans, what would you consider any, if any, rate-limiting steps that might potentially impact your second half of 2026 guidance?
And we have a question from Joe paninis with HC Wayne Wright please proceed.
Hey everybody. Good morning. Thanks for taking the questions I have 2, please. So first, um, on the back end with regard to PSC and your plans. Um, what would you consider any if any rate limiting steps that might potentially impact your second half of 26 guidance.
Ben Halladay: I mean, we don't really anticipate any, to be honest. Everything associated with our PSC program is baked in and incorporated into our expense guidance. You know, we've always reiterated this is a relatively cheap program to move forward through the IND process, which we expect to continue in the second half of the year.
Joseph Pantginis: So that's from an expense front. Also, from the scientific or preclinical study part components?
Um I mean we don't really anticipate any to be honest. Everything associated with our PSC program is is baked in and incorporated into our expense guidance. Um and you know we've always reiterated. This is a relatively cheap program to move forward through the IMD process, which we expect to continue in the second half of the year.
Ben Halladay: Oh, no, no, no, nothing this year.
That that's from an expense front. Also like say from the site uh the scientific or preclinical uh study part components.
Joseph Pantginis: Okay, got it. My second question, I will admit, is somewhat rhetorical, but I would love your thoughts. When you look at just the U.S., you talked about currently having about 28,000 healthcare providers prescribing the drug. Looking at your various marketing campaigns, the new ones coming up, the digital campaigns, and what have you, what would you say would be the key inflection areas that would take you more quickly from 28,000 ACPs to, say, 50,000 versus, say, 28,000 to 29,000?
No nothing nothing this year.
Okay, got it. And and my second question, I will admit is somewhat rhetorical, but I would love your thoughts. So when you look at just the US, um, you talked about how currently having about 28,000 Healthcare Providers, uh, prescribing the drug, you know,
Would take you more quickly from 28,000, hcps to say, 50,000 versus say, 28,000 to 29,000.
Sheldon Koenig: Well, look, I mean, I think, you know, to your point, Joe, we have been showing this growth every quarter as it relates to physicians increasing prescribing. I think what it has allowed us to do is also analyze what are the tactics getting us there. We talked about this TV ad in connected television. This is not a big DTC campaign, but this is something as more folks look at their phone or their tablet or their iPad. These are consumers, and they are watching, whether that be Hulu or NBC Sports, as we mentioned, there will be others. Consumers being driven to the physician also is very helpful. Matter of fact, we have done market research that has shown that every time a consumer has asked for this drug, they have gotten it.
Um, well.
Sheldon Koenig: So, this tactic of can't take a statin, make NEXLIZET happen, that is one that is driving physician growth. The consumer activation will also drive growth. What we are also seeing is that physicians who use this drug and patients who can't take a statin, whether they can't take a statin at all or they can only take a low dose of a statin, they say, wow, if it works this well without even taking the statin, what would it be like if they were taking the statin? So we are seeing more adoption than that add-on therapy also. Primary prevention is a big driver. All of those levers are going to continue our growth. Again, I would remind folks that primary prevention is a lever. We own that airspace. Nobody now or in the future will have that type of indication.
Look, I mean, I think it's your point Joe. You know, we've been showing this growth, you know, every quarter as it relates to Physicians increasing prescribing. I think what's allowed us to do is also analyze, you know, what are the tactics getting us? There, we talked about this TV ad and connected television. This is not a big DTC campaign but this is something as more folks look at their phone or their tablet or their iPad, these are consumers, and they're watching, you know, whether that be Hulu or NBC Sports. As we mentioned, there will be others, consumers being driven to, The Physician also is very helpful. Matter of fact, we've done market research that has shown that every time a consumer has asked for this drug. They've gotten it. So you know, this tactic of can't take a Statin make next, was that happen? That's 1 that's driving physician growth. The consumer activation will also Drive growth and what we're also seeing is that Physicians who use this drug and patients who can't take a Statin whether they can't take.
Joseph Pantginis: Perfect. I love the thoughts. I appreciate that. And again, it is just the growing strong blocking and tackling that you guys are doing. Thanks for the answers.
Take a stand at all, or they can only take a, a low dose of a Statin. They say, wow, if it works this well, without even taking the Statin, what would it be like if they were taking the Statin? So we're seeing more adoption than that add-on therapy also. So, um, and again, primary prevention is a big driver. So um, all of those levers are going to continue our growth. And again, I would remind folks that primary prevention is a lever. You know, we own that airspace nobody now or in the future will have that type of indication
Sheldon Koenig: Sure.
No, perfect. I love the thoughts. I appreciate that. And again, it's just the growing strong blocking and tackling that you guys are doing. Thanks for the answers.
Operator: Thank you. This concludes our Q&A session. I will turn it back to management for final comments.
Sheldon Koenig: Thank you, Operator, and thank you all again for your time and attention this morning. We are looking forward to participating in a number of September conferences 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, Alina Venezia, and have a great day and a great week. Take care.
Yes, sir, thank you and this concludes our Q&A session. I will turn it back to management for final comments.
Operator: This concludes our conference. Thank you all for participating, and you may all
Thank you, operator. And thank you all again for your time and attention this morning. We are looking forward to participating in a number of September conferences, 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 Elena venetsia and have a great day and a great week, take care.
And this concludes our conference. Thank you all for participating and you may all disconnect.
Mm.
Mhm.