MDGL Q4 2025 Earnings Call
Operator: Good morning, and thank you for standing by. Welcome to Madrigal Pharmaceuticals, Inc. Fourth Quarter and Full Year 2025 Earnings Conference Call. At this time, all participants are in a listen-only mode. After the speakers' presentation, there will be a question-and-answer session. As a reminder, today's conference call is being recorded. I would now like to introduce Ms. Tina E. Ventura, Chief Investor Relations Officer. Please go ahead. Thank you, Michelle. Good morning, everyone, and thank you for joining us to discuss Madrigal Pharmaceuticals, Inc.'s fourth quarter and full year 2025 earnings.
Tina E. Ventura: We issued a press release this morning and posted a slide deck to accompany this webcast on the Investor Relations section of our website. On the call with me today is William J. Sibold, Chief Executive Officer; David Soergel, Chief Medical Officer; and Mardi C. Dier, Chief Financial Officer. They will provide prepared remarks followed by Q&A. Please note on slide two, we will be making certain forward-looking statements today. We refer you to our SEC filings for a discussion of the risks that may cause actual results to differ from the forward-looking statements. With that, I will now turn the call over to William J. Sibold on slide three. Thanks, Tina. Good morning, and thanks for joining us.
William J. Sibold: Today, I will provide an update on the Rezdiffra launch where we ended our first full year on the market at nearly $1,000,000,000 in net sales and solidified Rezdiffra as the foundational therapy in NASH. We will discuss the significant growth in the U.S. NASH market, which is up nearly 50% since 2023 and growing at a double-digit pace. And then Dave will provide an update on our R&D strategy, where we now have more than 10 programs in our pipeline. Before turning to our fourth quarter results, I want to reflect on what we accomplished in 2025 and in just the first six weeks of this year. In a remarkably short period of time, we built the leading company in MASH and assembled a pipeline we believe will help define the future of this category. We continue to execute on a fantastic U.S. launch, extended Rezdiffra’s patent exclusivity to 2045, and initiated our ex-U.S. rollout beginning in Germany. Advancing our F4C trial for Rezdiffra, and we are accelerating evidence generation to further differentiate the product. At the same time, we moved quickly to build a high-quality pipeline around Rezdiffra, completing three transactions in roughly six months adding an oral GLP-1, a late-stage DGAT2 inhibitor, and a portfolio of six preclinical siRNA targets. Each designed to be studied in combination with Rezdiffra. The reason we are moving with this level of urgency is simple. Assets like Rezdiffra do not come along often. We have a high-quality, high-growth foundational therapy driving strong top-line performance with patent protection into 2045. When you have an asset like that, you have an opportunity to build a sustainable and durable franchise for the long term. That is exactly what we are doing. Rezdiffra gives us a unique ability to pursue combinations, to attract high-quality assets and to shape the market in ways other companies simply cannot. As a result, we are fundamentally a different company today than just six months ago. Transitioning from a single asset launch story into a fast-growing biotech with a pipeline designed to extend our leadership for years to come. Let us turn to net sales performance on slide five. We delivered fourth quarter 2025 net sales of $321,000,000, more than tripling fourth quarter 2024. For our first full year on the market, net sales totaled $958,000,000, an exceptional launch by any industry standard. That nearly billion-dollar result took a lot of work, we did not just launch a product. We built a market from scratch. Let us take a second and really think about that. Remember, NASH was long viewed as the graveyard of drug development. No treatments, no market, and skepticism that one would ever exist. Particularly with GLP-1s on the horizon. We took a different view. The unmet need was substantial, and demand for an effective therapy was real. We believed in the science and Rezdiffra’s ability to become the standard of care. We built the right team. People who have created categories and launched blockbuster brands. And we got to work. We executed with a long-term mindset. Wiring the system practice by practice, educating prescribers, establishing care pathways, expanding prescriber breadth and depth, and securing first line through disciplined contracting. And we continue to iterate and improve. The results speak for themselves. We were first to market, and that matters. Rezdiffra, with its liver-directed and differentiated profile, has established itself as the foundational therapy in NASH. The market is real and only beginning to take shape. GLP-1s are here, and as we expected, we are still steadily adding patients. There is room for competition, which we believe will further expand the market and we are building a pipeline designed to extend our leadership over time. As a result of the foundation we have built in our large base of prescribers, we continue to steadily add patients quarter over quarter as seen on slide seven. Remember, the number we report reflects the net of new starts and discontinuations at the end of each quarter. We continued to steadily add patients ending the fourth quarter with more than 36,250 patients on Rezdiffra up from more than 29,500 at the end of the third quarter. That tells us two things. First, Rezdiffra’s profile is exceptional and resonates very well with prescribers and patients. Second, this large and expanding market is capable of supporting multiple therapies. This represents a small fraction of the growing addressable population, and we expect to continue to steadily add patients quarter over quarter going forward. Let me spend a moment on the U.S. NASH market on slide eight. We are still in the early stages of what we expect to become a large specialty market. In just the last two years, the F2-F3 target population of 315,000 representative patients seen by our target specialists has expanded nearly 50% and we expect this market to grow at a double-digit pace for the foreseeable future. Rezdiffra’s approval and the increased industry investment across the ecosystem has fundamentally changed the market dynamic. Driving increased awareness, diagnosis, referrals, specialist involvement, and patients seeking care. This is a category in its very early stages where Rezdiffra is now established as the standard of care. As the market expands, we expect to benefit from its growth, increased penetration, and ultimately the introduction of additional therapies from our pipeline. NASH is a rare opportunity in biotech. Few therapeutic areas offer this combination of and high growth potential. That is why we expect MASH to follow the trajectory of other large specialty markets as shown on slide nine. Markets that support 10 to 15 plus therapies and have grown over decades to exceed $20,000,000,000 in annual sales. We believe MASH will evolve the same way. With one important difference, we are first to market with a product that has an unmatched profile. As an effective liver-directed, safe, and well tolerated oral medicine, it far surpasses the profile of first-to-market products in those other categories. And we continue to hear from our prescribers that Rezdiffra is performing even better than expected in the real world. This profile positions us well to expand into compensated MASH cirrhosis or F4C, the next phase of our growth strategy outlined on slide 11. We believe F4C could double Rezdiffra’s opportunity with approximately 245,000 patients, no approved therapies, and a significantly higher urgency to treat. Assuming regulatory approval, we expect to be first to market in F4C. Importantly, our F4C outcomes trial focuses on clinically meaningful outcomes, preventing decompensation, rather than relying on biopsy. Rezdiffra would be the only medicine with outcomes data solidifying it as the standard of care in NASH and supporting full approval across F2-F4C. Before I turn it over to Dave, I want to briefly outline how we see the MASH market evolving and why Madrigal Pharmaceuticals, Inc. is uniquely positioned to lead it by building on the pipeline strategy that I described earlier. NASH is a complex heterogeneous disease. Over time, we expect distinct patient subpopulations to emerge, each requiring different mechanisms, combinations, and sequencing approaches all anchored by Rezdiffra. We have seen this evolution before in other diseases, where progress was driven by matching the right combinations to the right patients. That is the model we are pursuing in NASH, and it is why we have moved quickly to add these specific assets to our portfolio. And the reason we can execute on this strategy is our high confidence in the growth potential of Rezdiffra. We are able to build an industry-leading MASH pipeline because we have an outstanding product. One that is performing exceptionally well today and is positioned for continued strong growth. That strong foundation allows us to develop the next generation of NASH therapies for patients. That is exciting, and it is a true differentiator for Madrigal Pharmaceuticals, Inc. Dave, I will turn it over to you to walk through our R&D strategy.
Tina E. Ventura: Thanks, Bill.
William J. Sibold: Our objective in R&D at Madrigal Pharmaceuticals, Inc. is straightforward. Build the industry-leading pipeline in MASH to make better therapies for patients. We are doing that through targeted business development and smart clinical execution leveraging the expertise of an R&D team that pioneered modern MASH drug development. Our strategy has four goals. Deliver outcomes data and full approval for Rezdiffra from F2 through F4C, advanced complementary mechanisms for combination with Rezdiffra to deliver the best efficacy across the NASH spectrum. Remain modality agnostic, keeping development to the best combination regimens as our strategic aim. Note our recent addition of injectable siRNAs. Leverage our experience to evolve the science. Design smarter, more informative clinical trials enabled by our extensive data and operational experience in NASH. Our aim is to use capital efficiently to take more shots on goal and advance only the most promising programs for patients. The first pillar of our R&D strategy is delivering outcomes data in F4C. The basis of our high confidence in our outcome study are the data from our two-year open-label study, the importance of the two-year data is better understood in the context of how cirrhosis progresses. Development of clinically significant portal hypertension or CSPH is a critical inflection point in the disease. Marks a transition from compensated cirrhosis towards decompensated disease. And is when the most serious complications like variceal bleeding and development of ascites begin to occur. Crossing the threshold into decompensated cirrhosis predicts poor prognosis, with an average survival time of two to three years without a liver transplant. From the literature, it is clear that patients with CSPH have meaningfully higher rates of liver-related events, and reducing CSPH risk lowers liver-related events. That is why the two-year open-label 122 patient F4C data from our NAFLD1 trial are so exciting. As shown here on slide fourteen, 65% of patients with CSPH at baseline moved into lower risk categories by year two. These data support Rezdiffra’s potential in F4 and reinforce confidence in our outcomes trial. Particularly given that both trials have very similar patient populations. The second pillar of our R&D strategy is advancing combination therapies anchored by Rezdiffra. Slide 15 shows many of the known mechanisms involved in NASH. NASH is driven by excess free fatty acid delivery to the liver leading to steatosis, inflammation, and fibrosis. While there are many potential points to intervene in the disease, it took decades and more than 20 industry failures before Madrigal Pharmaceuticals, Inc. cracked the code with Rezdiffra. Today, only two mechanisms have crossed the finish line, THR beta agonism, addressing NASH at its source in the liver and indirect acting GLP-1 agonism. But NASH is a heterogeneous chronic disease and therefore, we expect treatment to evolve toward combinations. Rezdiffra gives us a unique solid foundation on which to build combinations to achieve better efficacy overall, or in certain patient subpopulations. Our combination strategy is simple. Prioritize validated mechanistically complementary approaches that enhance efficacy while preserving Rezdiffra’s strong safety and tolerability profile. In orange, you see where we have already acted, an oral GLP-1, a late-stage DGAT2 inhibitor, and multiple targets using siRNA. Let us discuss why we are excited about these new mechanisms starting with siRNA on slide 16. First, siRNAs target validated genes that drive MASH progression. Using precise mRNA knockdown, we can either enhance efficacy broadly or develop more tailored approaches for defined patient subpopulations. Second, the modality. GalNAc conjugated siRNA is well established and highly liver targeted. The clinical safety of the platform is supported by multiple marketed products. We acquired six preclinical siRNA assets that are highly complementary to 17 covers our DGAT2 which we are excited about for a number of reasons. First, DGAT2 inhibition is a complementary mechanism to THR beta agonism. Evogastat prevents free fatty acids from being incorporated into triglycerides, and Rezdiffra restores mitochondrial function to allow those free fatty acids to be turned into energy through beta-oxidation. The two mechanisms together, therefore, address both the production and clearance of excess hepatic fat. Second, we know a lot about Evogastat. It is already completed a phase 2b trial in NASH, demonstrating robust MRI-PDFF reductions and clean safety. In the MIRNA study, 72% of patients at the 150 milligram dose achieved at least a 30% reduction in PDFF. And 61% achieved a 50% reduction, what many experts now consider a super response predicting a greater likelihood of a reversal of fibrosis.
Mardi C. Dier: The combination of these two mechanisms has the potential to move more patients into that super responder category, and drive better anti-fibrotic efficacy and better outcome. We plan to initiate a drug-drug interaction study this year and to begin a phase 2 combination program in 2027 following FDA discussions. Next, our oral GLP-1 on slide 18.
Tina E. Ventura: Let us start by acknowledging that there is strong real-world enthusiasm
Mardi C. Dier: for combining GLP-1s with Rezdiffra with an understanding of the mechanistic complementarity of GLP-1 and Rezdiffra. GLP-1s act outside the liver by improving systemic metabolism and reducing free fatty acid delivery to the liver. This complements Rezdiffra’s liver-directed mechanism of action. Importantly, our focus for this program is on developing a better treatment for NASH not maximal weight loss. And therefore, our goal is to balance the right amount of weight loss to potentiate Rezdiffra’s anti-fibrotic effect. So what is the right amount of weight loss to achieve better efficacy in NASH? In MAESTRO-NASH, we saw that as little as 5% weight loss meaningfully potentiated Rezdiffra’s fibrosis benefit. So our aim is a once-daily, well tolerated oral fixed-dose combination that optimizes efficacy while maintaining good tolerability. Phase 1 single-ascending dose study of MGL-2086 is expected to start in the second quarter. Putting it all together on slide 19, we are translating our into action with one goal in mind. Build the leading MASH pipeline. And this is really just the beginning of an exciting journey. With Rezdiffra protected into 2045, we have a long runway to invest and innovate. Building a pipeline that will define the future of NASH care. With that, I will hand it over to Mardi.
Tina E. Ventura: Thanks, Dave, and good morning. Turning to slide 20 and a summary of our financials. Fourth quarter 2025 net sales totaled $321,100,000 reflecting another quarter of strong demand and bringing full year 2025 net sales to $958,400,000 As we have discussed, we have made excellent progress
Operator: contracting for first line access in 2026,
Tina E. Ventura: with some contracts taking effect in the fourth quarter of last year as anticipated. As a result, our gross-to-net impact increased from the third quarter to the fourth quarter. As a reminder, gross-to-net includes several components. Commercial rebates, government rebates, copay assistance, and channel distribution costs.
Operator: The team did an exceptional job managing these dynamics resulting in a full year average at the low end of the 20% to 30% range we previously outlined
Tina E. Ventura: an excellent outcome for 2025. We are off to a strong start this year and continue to steadily add patients. As indicated last quarter, we expect our payer agreements to bring our full year 2026 gross-to-net impact into the high 30% range,
Operator: consistent with specialty medicine analogs.
Tina E. Ventura: Looking ahead, we expect robust net sales growth in 2026 despite the step up in gross-to-net from contracting that begins in Q1 plus the typical
Operator: first quarter dynamics related to benefit plan changes and insurance reverifications. The fundamentals of the business are strong, and we are looking forward to another outstanding year of performance.
Tina E. Ventura: Moving briefly to operating expenses. R&D expenses for the fourth quarter and full year 2025 were $116,300,000 and $388,500,000 respectively, the increase over the prior year periods was primarily due to business development. In the third quarter, this included a $120,000,000 upfront payment for our oral GLP-1 and in the fourth quarter, $50,000,000 upfront payment for Evogastat and our two additional early-stage MASH pipeline assets. Of note, the upfront payment of $60,000,000 $60,000,000 for our 2026. SG&A expenses for the fourth quarter and full year 2025 were $240,000,000 and $8,800,000 respectively, the increase over the prior periods was expected to support the Rezdiffra launch. Looking ahead, we expect 2026 R&D expenses to be roughly the same as 2025 as we build our organization and begin to invest in our pipeline programs.
Operator: We anticipate SG&A expenses to increase next year as we continue to support the launch of Rezdiffra and build the foundation for exceptional long-term growth.
Tina E. Ventura: Turning to our balance sheet. We ended 2025 with $988,600,000 in cash, cash equivalents, restricted cash, and marketable securities. With a strong cash position, we continue to be well resourced to support the ongoing launch of Rezdiffra and the advancement of multiple pipeline programs and continued business development. So to close, slide 21 captures why we are so confident about where Madrigal Pharmaceuticals, Inc. is headed. Rezdiffra is the foundational therapy in F2, F3, NASH is just getting started. F4C represents another meaningful growth driver that could double our commercial opportunity. And our pipeline, now more than 10 programs deep positions us to extend our leadership position as a durable
Operator: category-leading franchise.
Tina E. Ventura: Taken together, this is a company built for sustained value creation,
Operator: across our launch, indication expansion, and pipeline.
Tina E. Ventura: We believe we are exceptionally well positioned to lead in MASH
Operator: in 2026 and beyond. I will now turn the call back to Tina to open the Q&A session.
Tina E. Ventura: Thanks, Mardi. Let us move into the Q&A portion of the call. Michelle, please go ahead and provide instructions for the Q&A session.
Operator: We will now open the lines for questions. And to open your line, please press 11, and you will be added to the queue. And our first question is going to come from Eliana Merle with Spark. Your line is open.
Eliana Merle: You are seeing meaningful growth in the number of diagnosed patients. Can you elaborate on the drivers here and talk about your expectations for category growth in 2026? And then second, you are also seeing an acceleration in patient starts despite the launch of Wegovy. Can you elaborate on the types of patients you are seeing starting on Rezdiffra now versus say, in the past and any trends you are seeing across the types of different prescribers. Thanks.
William J. Sibold: Great. Eliana, thanks for the question. Yes. We are seeing really strong growth. As you saw on the slides, which say a lot, almost 50% growth over a two-year period. And this you know, we had talked about the market is in a position to grow. Right? The 315,000 diagnosed patients was diagnosed sitting in the offices of the target specialists that we were calling on. And what we are seeing is our efforts are really paying off on a couple of fronts. Number one, as awareness goes up, there is going to be more people that are diagnosed. I think that having another company in the mix Novo who is really trying to drive, I would say, broad awareness and uptake in the primary
Operator: care
William J. Sibold: offices, etcetera, is leading to more diagnosis. Our focus has always been the 315 as we see a path to peak essentially through what is already available. Now, inevitably, though, as you bring products to market, you see higher growth in that space, and that is where we have seen the 50% and double-digit growth we are expecting, into the foreseeable future. So we are really quite excited about it, and it gives us not only a clearer path to peak, but also perhaps it gives us a greater opportunity than we had even anticipated in planned around. So, growth you see in all these markets you are going to see patient growth for, really, years and years. And, you know, I will leave that there. The question on patient adds, you know, we have been saying and we continue to steadily add patients. And we have seen really no difference in the type of patients that is being prescribed Rezdiffra. They tend to be a pretty even mix between F2 and F3. And as it relates to I think you mentioned a little bit about endocrinology. Or how our efforts are just in general with growing. You know, we are seeing prescriptions mostly in the hep GI space. That is the predominant number of obviously, more gastroenterologists than endocrinologists. They have just gone deeper into the deck, I would say. You know, we said that we have established really great breadth of prescribing, and now it is a matter of going deeper into their patient population. And I think what we are seeing is proof points that, this is becoming the standard of care. Patients are being put on Rezdiffra, having great experiences, staying on the drug, and you see that reflected in the patient adds? Great. Thanks, Eliana. Next question, please.
Operator: And our next question will come from Thomas Jonathan Smith with Leerink Partners. Your line is open. Hey, guys. Good morning.
William J. Sibold: Congrats on the quarter, and thanks for taking our questions. Maybe just one quick clarification question on I just wanted to ask about the contribution of the Germany launch to the worldwide revenues and patient numbers, and maybe if you could expand a little bit on expectations for 2026. And then on the pipeline combo programs, I know you are starting to look and you have guided today to a phase 2 study with Evogastat next year. Could you just elaborate on how you are thinking about sort of mid-stage phase 2 studies from here? Do you think these studies will need to evaluate
Michael DiFiore: liver histology via biopsy before you progress into, pivotal studies is there potential for a more accelerated path that perhaps leverages NITs? Thanks so much. Yeah.
William J. Sibold: Tom, thanks for the question. I will start off with answering Germany. Germany contribution in 2025 was negligible. And we do not see actually a lot in 2026 as well. You know, really, part of the driver of that is as we are launching into an MFN world, it is still uncertain how ex-U.S. is going to evolve. And that is not a Madrigal Pharmaceuticals, Inc. issue. That is for the whole industry. So, negligible in 2025, we are just getting started really in 2026. Do not expect a lot of contribution from Germany or ex-U.S. in 2026. This is U.S. is the base business. U.S. has had exceptionally strong dynamics to it as you have seen. Not only from a performance perspective, but from an outlook perspective. So we are very, very comfortable being able to have robust growth in 2026 the way 2026 is unfolding from an international market perspective.
Tina E. Ventura: And maybe I will just put on a finer point about our 2026, Tom. We really do expect robust growth, and where consensus is coming out for 2026 already, we feel really good about that, which reflects very good growth from where we ended up with the $958 for 2025.
Mardi C. Dier: Dave, do you want to Yeah. Sure. For the for the combination. Thanks thanks for the question, Tom. So, you know, it is it is a bit early to be definitive about our program in phase a conversation about their expectations two at this point because, you know, we do need to go to the FDA and have for the phase 2b program, you know, then leading into the phase 3 program. However, what I will what I will say with respect to NITs is that, you know, clinical care has moved well past biopsy. You know, biopsy is not used in clinical care anymore. And FDA has, shown more and more interest in qualifying noninvasive tests, for use in drug development. I would say in phase 2, our expectation is that NITs will play a major role in our assessment as, you know, as we show in the in the slides, we have a strong understanding the relationship between PDFF reduction and a potential improvement in fibrosis. So, as you can see, we are anchoring a lot, how we are looking at the program around, evaluation of NITs in phase 2.
Tina E. Ventura: Great. Thanks, Dave. Michelle, next question, please.
Operator: And the next question will come from Yasmeen Rahimi with Piper Sandler. Your line is open.
Tina E. Ventura: Yeah. Good morning. This is Yasmeen Yeah. Good morning. Is Emma on for Yasmeen. Thanks for taking our questions. Firstly, it is maybe help us understand for MAESTRO-NASH outcomes in F4C, how are you tracking blinded event rates? Like and how is this, like, tracking for on-time data? At what point in this year might you tighten guidance in that regard? And is there any additional cirrhosis open-label NAFLD data follow-up that we could get to further strengthen conviction in the test? Thank you. Great. Thanks for the question, Dave. I will turn that over to you. Yep. Sure.
Mardi C. Dier: I I guess for, thanks for the question. I think on the, let us start with the last part. Is there going to be any additional open-label data? I mean, think we have shown quite a bit already. So we have gotten quite a lot of information out of those 122 patients in the open-label NAFLD1 study. And I think what you can see from that experience is that even patients with the most severe disease, so individuals with clinically significant portal hypertension, we see what look like a positive effects of Rezdiffra in that population. You can move people into lower risk categories, of CSPH over a two-year time frame. So we have already gotten a lot out of this. Out of this open-label experience. With respect to the progress of MAESTRO outcomes, we are seeing events track in the range that were expected. So, as as we have talked about, historically, if you look at natural history data, you see about a 5% to 10% annual event accrual in patients with cirrhosis. We estimate in the placebo group somewhere in that range. And we are seeing, events, track, with expectation to deliver data, in 2027. With respect to guidance, we need to get a little bit further along to get, more precise on our timing.
Tina E. Ventura: Great. Thanks, Dave. Michelle, next question, please.
Operator: And the next question will come from Prakhar Agrawal with Cantor Fitzgerald. Your line is open.
William J. Sibold: Hi. Good morning, and thank you for
Akash Tewari: taking my questions and congrats on a strong quarter. Maybe firstly on gross-to-net, you could comment on gross-to-net for 4Q and cadence for the rest of 2026. And would you still expect broad first line access without step edits for Rezdiffra in 2026. Now that we are seeing no contract. And maybe just another follow-up, if you can comment on compliance persistence and discontinuation rates that you are seeing especially since Wegovy’s launch in the market. Thank you.
William J. Sibold: Great. So, maybe I will start a little bit with just the payer contracts. They are complete. They were in place January 1 or earlier. And as we previously said, we were contracting for broad first line access. No step edits, and improved utilization criteria where it is possible. So that holds true. We are in a really great place for contracting. I think this when I think about kind of the accomplishments, the way we have managed contracting and gross-to-net is absolutely best in industry that I have seen that certainly any launch I have been a part of. Remember, we came out of the gates. We did not contract. It is now only entering into the quarter of launch that you are going to be having broad contracting. So the focus really has been preservation of gross-to-net, and I think we have done a great job at it. And we have set ourselves up, exceptionally well for 2026. Before turning it over to Mardi for gross-to-net, let me finish the compliance and persistence question. Same as what we have said, well tolerated oral. You know, a well tolerated oral at the one-year mark is in this 60% to 70% range. Certainly, we are continuing to see that strong performance and, you know, really encouraged. As I said, we have seen some institutions have been able to have persistence up in the 90% range. We are doing everything we can to learn from kind of the the best performance and how to apply that to the broader population. We have got an outstanding patient service team that is all over this. We work closely with specialty pharmacy and providers and patients to work on that. You asked the question about Wegovy. And, you know, what is the what is the impact that we are seeing there. Well, look. Wegovy is being used, but certainly not to the detriment of Rezdiffra. In fact, we just had our best NBRx week since launch, which says to me that just as we had said, you can have multiple products in the space, but that Rezdiffra really is the winning profile. Maybe with that, why do I not turn it over to Mardi to talk about gross-to-net evolution?
Tina E. Ventura: Yep. Great. Thanks, Bill. Yeah. Let us break down gross-to-net a little bit.
Operator: Prakhar, thanks for the question, and maybe a little comment on Q1 as well. So nothing is really changed from what we discussed.
Tina E. Ventura: Last quarter with respect to gross-to-net. So we ended the fourth quarter exactly where we thought we would be, which was the midpoint of our 20% to 30% range. And that was a bit of an from third quarter as anticipated as some of the commercial contracting, which remember is one component of gross-to-net, took hold in the fourth quarter. So again, ending fourth quarter in that midpoint of the 20% to 30% range as expected. Now going into 2026, none of our messages have changed here either. With the, basically, zero to contracting that we have been discussing as we put those commercial contracts into effect.
Operator: As of 01/01/2026, that moves our gross-to-net discount our overall gross-to-net discount, with all the components into the high 30s for 2026. And we have broken that down really by quarter. It really
Tina E. Ventura: stays in that high 30s for each of the quarters for 2026. There is always intra-quarter variability because there are so many components but generally in the high 30s, for gross-to-net all as expected. And remember, as Bill just said, we get that excellent first line access no step edits, etcetera. So we are in very good shape and have always taken our gross-to-net our diligence around gross-to-net very seriously. But, you know, for as we discussed about Q1, looking at
Operator: Q1 and what our expectations are for Q1, not much has changed there either. So we have to
Tina E. Ventura: take into effect
Operator: which is different than most companies that we have this zero to contracting impact to gross-to-net for Q1. In addition, to just the normal Q1 effect. So if we look at our analog
Tina E. Ventura: all the specialty medicine analogs that we refer to
Operator: frequently and have since launch, if we look at what the typical first quarter impact is, it is a decline in net sales of
Tina E. Ventura: mid to high single digits. And that takes into effect the reverifications of the insurance plans and sort of the typical Q1 effect. And that is really reflective of where we believe our first quarter will be as well. But you have to consider not only do we have the Q1 effect, we are never immune to that. But we also have this in this order, the zero to
Operator: contracting impact on gross-to-net that we just discussed.
Tina E. Ventura: So we feel that that is pretty impressive considering that we have been able to steadily add and still have a strong Q1.
Operator: With the typical Q1 effect and zero to contracting. So we think we are going to be in good shape. Overall. For 2026. And as I already mentioned, we will have robust sales growth in 2026.
Tina E. Ventura: Great. Thanks, Mardi. Next question, please, Michelle.
Operator: And the next question comes from Akash Tewari with Jefferies. Your line is open.
Akash Tewari: Hey. This is Manoj on for Akash. Thanks for taking our question. Just one from our end.
Gao Yi Chen: You mentioned about, like, 60% to 70% persistence rate. When we looked at the AASLD data, there was, like, some presentation showing more than 90% adherence rate in the real world. How important is to keep the adherence rate to that 90 is to maintain the current patient adds and the revenue growth. And also, do you expect any acceleration in patient adds going forward now with all the contracts in place, or should we think about, probably around 6,000 to 7,000 patients net patient adds every quarter? Just to trying to understand that point. Thanks.
William J. Sibold: Great. So thanks for the question. Let me start with the patients. Look. We have said that we have been steadily adding patients, and we expect to steadily add patients going forward. And I think that is certainly an important measure as we show you this quarter, how we did in light of having another product on the market. So the fundamentals are really, really great, and we would expect in this environment to continue to steadily add to the contracting, remember, we have had great access from the beginning. The contracting does not really accelerate anything. Because we through if there was no policy in place, if you had a medical exception, those were flowing through very quickly. But in this next phase of launch, you know, we partnered with the payers. I think we have had some really great discussions. I think they have understood the value of Rezdiffra. They see the cost of these patients in their systems, and you know, we I think we have landed in a really good place for the future with them, and, you know, we do appreciate the partnership that we have. Now regarding persistence, you know, we are in that well tolerated oral range, as I said, the 60% to 70%. And, yes, as you point out, there are some institutions that have reported rates all the way up to 90%. Now what we will always try to do is look for ways to, you know, help appropriate patients stay on product as long as they need it. And I think that sense of urgency has increased coming out of AASLD where we presented data from both the F2-F3 population and the F4C population if you discontinue therapy. Disease comes back, and it comes back quickly. So, you know, we do believe this is a chronic therapy and that it is in patients' best interest obviously, prescribers' best interest, and overall for the system. Best interest that they stay on therapy. So we have a lot of initiatives underway that we are doing with our own patient services group. Partnering with specialty pharmacy and institutions, and working with patients as well directly to try to help that persistence rate improve to a level which is even higher than the well tolerated oral range. But that takes a lot of work, and, you know, there is just you know, people look. They regardless of whether it is for regardless of the type of indication, people tend to drop off drugs in time, but we are going to do everything we can to educate people on appropriately.
Tina E. Ventura: Great. Thanks so much. Next question, please.
Operator: And the next question will come from Michael DiFiore with Evercore. Your line is open.
Michael DiFiore: Hi, guys. Thanks so much for taking my questions, and congrats on the continued progress. Two for me. The first, over the past several months, you have added multiple combination assets around Rezdiffra, including DGAT2 and GLP-1 and siRNA programs. My question is how do you avoid diminishing return from putting too many synergistic mechanisms into the pipeline? And what is your go, no-go criteria for advancing a second agent both clinically and commercially? And then my second question is briefly has there been any change in expected timing of MAESTRO-NASH outcomes now that the FDA has approved AI-supported pathology rates? Thank you.
William J. Sibold: Okay. Dave, I am going to pass over to you in a second. But just, you know, just let us just take a step back what we are trying to do here, Mike. And thanks for the question because I think this is really important. So with Rezdiffra, we have what has become standard of care and is truly a foundational therapy. And that is just not from use. Looking at the clinical data, one of the things that is really striking is that across all subgroups, you have essentially a consistent effect. So in other words, it tends to be that, you know, all these F2, F3 patients do well. It is not as the one group does, you know, like, a super responder group. Now that is a great therapy. And, you know, rarely do you see something that has that type of results. Now if we can, through the addition of new mechanisms of action, find a way to have the whole population or a subpopulation do better then that really provides an opportunity for better patient outcomes. And that is how we are thinking about this. So when we are going out and looking at any of the mechanisms we are bringing in, it starts with we believe that there is a strong mechanistic rationale that in combination we could see a better effect for all or some patients. Now we have to test that theory, and that is why we are going to do these trials to quickly determine whether we if there is a there there. And we will kill or move forward quickly. The goal is not to have a lot of straggling things in the pipeline that never do anything except for suck up resource. We are not doing that. We are going to try to only take forward what is meaningful for patients. Now we also see the market evolving, though, where various subpopulations or let us call them segments may emerge. And we are well positioned not only with Rezdiffra, but now as we make these combo programs to provide a better product for those segments. So this is extremely when I say well thought out, it is well thought out. It is deliberate. It is based on mechanism, what we like, and it all starts with the fact that Rezdiffra is a foundational therapy that is really one which is amenable to either dose combinations or combinations for instance, with siRNA where you may have a pill and an injection but in a very favorable regimen. So that is just to give you the thinking of it. Dave, maybe Yeah. Just over to you for a little bit more color around it. Yeah. Yeah. I think I think
Mardi C. Dier: the only thing I would add there is that when you start with a solid foundation that works in everybody, that is not necessarily true of every combination partner you add. Right? So it could be that, a particular combination partner, for example, DGAT the GLP-1 or one of the siRNAs, does better, for certain patient subtypes, whether they have a genetic predilection to disease progression or they have some comorbidity that sort of the combination partner happens to target more effectively. So the other thing I think that is really important about our strategy is that it is adaptable. Right? It is adaptable to the science. So as we run our phase 2 studies, we will be able to determine whether or not you know, the drug is kind of going to be broadly applicable to the population and broadly does something you know, that is going to be meaningful for patients with NASH or a subsegment within the NASH population is going to be a better target for that combination treatment. So I would just add the adaptability part for how we are thinking about pursuing these agents. Yeah. Then I think your second question was about MAESTRO outcomes and AI path reading. So it is great, you know, that the agency again is sort of evolving their perspective on MASH drug development. MAESTRO outcomes is an event-driven trial, so it does not it is not a histology-driven study. So, you know, AI path reading would really would not be relevant there. For MAESTRO-NASH, our F3 study, that is a biopsy-driven trial, but it is a landmark study. In other words, everybody gets, a biopsy at, month 54. Which is then, you know, compared to baseline. So it, we would certainly, consider using AI path reading as part of our analysis, but it is not the primary assessment we would
William J. Sibold: Thanks for the question, Mike.
Tina E. Ventura: Thanks. Next question, please.
Operator: Next question comes from Jay Olson with Oppenheimer. Your line is open.
Tina E. Ventura: It is always Oh, hey. Congrats on the impressive
Mardi C. Dier: progress, and thanks for taking our questions. Just to follow-up on the previous question. Since you have two all oral combos, where do you envision the siRNA modality to fit into the future
Jay Olson: treatment landscape of NASH? And is there any color you can share with us on the targets of those six siRNA programs, and when should we expect the timing of clinical development? Thank you.
William J. Sibold: Thanks, Jay. Look. First of all, on the siRNA targets, for competitive reasons, we are not going to disclose the targets at this point. But stay tuned as we move along. We will certainly be sharing that, with, with you. Look. Where does where does it fit? So first of all, you know, we thought of the targets that we are looking at, we believe there is a rationale. For MASH and potentially making a better product. As I said, it starts with mechanism and the rationale to make a better drug. I am going to let Dave kinda walk through kind of our whole siRNA siRNA strategy, but you know, we really think it is a nice combo when you think about it. A every three to six month injection and a daily pill. Pretty easy. You know? If you are getting if you get a better effect from that, that is not a that is a pretty strong value proposition. What makes it an even stronger value proposition is it is all within the same company. So this is not going to be a it is not a battle for somebody having to optimize a single product. It is us being able to look holistically across the disease and say, what is the right solution for that patient or segment of patients? And we can provide that in an efficient manner. And so it will always be about what is the right therapy rather than having to sell a therapy. Dave, maybe I will pass it over to you. Yeah. I mean, I think just to add on, I mean, from a
Mardi C. Dier: scientific standpoint, the you know, as Bill mentioned, siRNA technology is really had a breakthrough over the last ten years or so, and we can develop now highly targeted, well tolerated therapies that last three to six months as Bill said or even up to twelve months. You know, the latest technology can even get you that much further. So we are, you know, we are very fortunate to be working with Ribo Life Sciences, you know, a leader in siRNA technology. To be developing these drugs. And, you know, I think the key is that that sort of that combination regimen that sort of approach will make sense for either all patients or some patients. Again, we look for drugs that either have preclinical, clinical, or genetic validation and all of these targets kind of fit within those categories. So we think that, you know, with Rezdiffra, that solid foundation to add on these long-acting therapies, this could be a real advantage for patients with NASH.
Tina E. Ventura: Good. Dave. Thanks, Jay, for the question. Next question, please, Michelle.
Operator: Next question will come from Jonathan Wolleben with Citizens. Your line is open.
Michael DiFiore: Hey, thanks for taking the question and congrats.
Andrea Tan: You guys have talked about this growth of the market. This is the first time you guys put some numbers to it, and it does not seem like any of these dynamics you are attributing it to are going to go away anytime soon. Wondering how should we think about you know, five years from here, the F2-F3 target population, growing? And then also, should we expect, you know, further growth of the F4 population as well with patients still advancing? Just trying to get a bigger picture about the road ahead. Thanks.
William J. Sibold: John, thanks for the question. Yes. I mean, look, what we said is that we would expect double-digit growth for the foreseeable future. That is certainly for the five-year period. So pretty robust growth I think now, again, you have got a therapy that works. People are talking about the disease. And, you know, as I said, we are benefiting from having a competitor that is out there talking a lot about it. And as we know, they need, you know, really lots of patients in order to make MASH a meaningful, indication for them. So we think that it is a position for years of growth. And your other question was
Tina E. Ventura: Laid that four.
William J. Sibold: Oh, F4. Look. Yes. We would expect to see similar not similar growth, but growth there. We are still working through the details of what that F4 population looks like, but I think you can assume that there will be growth as we get a little bit further into our analysis of the market and we are getting closer to our launch, we will provide updates as to where that is going. But overall, you know, as MASH grows, F4C will grow as well.
Tina E. Ventura: Great. Thanks, John. Next question, please, Michelle.
Operator: Next question is from Ritu Subhalaksmi Baral with TD Cowen. Your line is open.
Eliana Merle: Hi, everyone. This is Nicole on line for Ritu. I am just wondering about the extensive script
Andrea R. Newkirk: growth needed over the fiscal year 2026 to grow revenue off of the increased for the gross-to-net. And just a quick second question, what do you think companion diagnostics predisposition would need to be developed to show any genetic to for NASH if you are going to eventually move forward with the siRNAs if data is positive. Thanks. And, Nicole, can you just clarify your first question? It was a little we missed a word. Yeah. Sure. Yeah. Absolutely. The extent of script growth or patient adds needed over fiscal year 2026 to see a growth in revenue. To offset the increase in gross-to-net.
William J. Sibold: Well okay. So let me let me start then. But let me be clear. There is
Mardi C. Dier: there is
William J. Sibold: we are growing. The fundamentals of the business are exceptional. We are steadily adding patients. We are going to see robust growth in 2026. And into the future. So, I mean, let me just be crystal clear. When we talk about Q1, Q1 has two Q1 things going on. First of all, the Q1 effect that every single product in the industry experiences, reauthorizations, etcetera. On top of that, though, we have the zero to contracting. So instead of contracting for the two years previously, and having a steady increase in gross-to-net, we held off contracting until the seventh quarter of launch and or eighth quarter of launch, I guess. And so you have the zero to contracting effect. So we are still, despite that, in the range of the comps that we look at, which is kind of really remarkable. It says how strong the underlying business is. So expect to see growth. Our you know, look. We are not going to do the model is the number of patient adds, etcetera. But robust growth now and in the future. Mardi, do you have any other comment on that?
Andrea R. Newkirk: Exactly. We talked about it, Nicole, for 2026. From a consensus standpoint, we feel really good where where the Street is right now for 2026, which reflects robust growth
Tina E. Ventura: from where we ended in 2025. So we feel like we are in good shape. We already talked about the Q1 effect and gross-to-net as daily adding patients. And I will just reiterate what Bill said. Last week was our best MBRx week ever. So the underlying business is in really good shape, and we anticipate that that growth through 2026 and beyond. Quite frankly.
William J. Sibold: Yeah. And yep. That is right. Go ahead. Dave.
Mardi C. Dier: So companion diagnostic. Real interesting question. I mean, you know, it is early to sort of comment on that because, you know, to consider a companion diagnostic, you have got to be looking for a particular, for example, genetic or biomarker type target. To tie your therapy to. So as Bill mentioned, Rezdiffra, of course, does not need that because it works very well across all patient subpopulations. We will see, you know, as the combination products move forward, you know, if there is a need to develop a companion diagnostic. But as of right now, we do not foresee that, with these programs. Right. Or just just really quickly to follow-up. Are genetic screening common in the clinic already? They are becoming I think, generally speaking, I cannot speak in NASH in particular necessarily, but across general clinical care, genetic screening is becoming more common. Yes. But, you know, I think producing, a genetic or another biomarker companion diagnostic, you know, takes an additional lift for sure. Yeah. And just remember, we
Jay Olson: let us just
William J. Sibold: let us just put a fine point on this. We are seven quarters into the launch of an entirely new category. There are decades of growth and evolution in front of us. The decisions that we are making today with the pipeline are not 2026 decisions. They are not even 2027 decisions. These are helping to form treatment which will include diagnosis any kind of test that obviously will be done to segment patients, etcetera, that will evolve in time. So we are very much on the forming side of this. And remember, we are less than 12% penetrated into the 315. It is less than 8% into the 460 that we talked about. This is at the beginning of a very significant specialty market. We are the company at front end of it that can drive it, not only for the coming years, but for, we believe, decades in advance.
Tina E. Ventura: Great. Thanks. Next question, please, Michelle.
Operator: Next question is from Thomas Smith with B. Riley Securities. Your line is open.
Jay Olson: Thank you so much for taking our question, and congrats on a very nice quarter.
Catherine Okoukoni: Just sort of sticking with what you were just talking about, Bill, in terms of the market increase from 315,000 to 460,000. Just curious if you or know, if you see that correlated with the increase of patient prescriber interest and potentially we should think about that as reading through to sort of new patient adds. Is this more of a longer term, just more runway in terms of patients? Or is this actually feeding increased new patient additions. And then I have a follow-up.
William J. Sibold: One of the real important yes. Thanks. Look. So I think pieces of this of the update is if you look and see where that real growth is taking place is in the target specialists that we are calling on. And I think that is really important. What it is saying is that our efforts really are working in that patients that are diagnosed are making their way to the specialists that treat NASH. And, you know, we have been clear from the beginning. We think this is a specialist disease. That is why we are focused on hepatology, gastroenterology. And now some endocrinology as well. That is where the patients are. Those are the experts that should be treating it, and that is where we are seeing the biggest growth taking place, which is indicative of our wiring of the system being extremely successful. So I think what you are going to see is, remember, we are still at a very low rate in the already diagnosed. And so we still have a lot of patients to get through just in that initial 315. And then as more and more come in, and this becomes standard of care, that is when you see just treatment rates get higher. As well as diagnosis rates gets higher. So, you know, that is just you a little bit of flavor around it. And you said you had a quick follow-up. Maybe, it is just real quick because we have got to move on.
Catherine Okoukoni: Yeah. Thanks. In reference to your GLP-1 and your DGAT, it looks like GLP-1 might be, initiation starting for your for phase 1. It looks like it might be pushed back slightly from first quarter to second quarter. In terms of both those programs, just curious what remaining gating activities still need to be completed.
Mardi C. Dier: Yeah. We so we I think we guided initially to first half.
William J. Sibold: And then we have refined it to second quarter. So there is there has been no delay in the no change. No delay. Okay. Thanks. Okay. Thanks.
Tina E. Ventura: And, Michelle, we have time for one more question, please.
Operator: Okay. The last question will come from Srikripa Devarakonda with Truist. Your line is open.
William J. Sibold: Hi. This is Alex on for Kripa. Thanks for taking our question. Congrats on the progress. Now that we are seeing more and more patients on for longer time periods, we want to know, have you seen any challenges in the reimbursement process to keep patients on drug
Michael DiFiore: for the extended time periods? We can imagine that for many patients with Rezdiffra, that their fibrosis scores could improve, and they might technically be outside of the label requirement.
Catherine Okoukoni: That is that. Thanks.
William J. Sibold: Okay. Thank you very much for the question. So, you know, first of all, the reauthorizations we said are very routine. Oftentimes, it is physician attestation or showing some kind of stabilization or improvement in one of the NITs that has been used initially. I think you know, look. We are, again, we are really early into the treatment of the disease. Think what is very compelling for the community is I will go back to the AASLD data which showed that discontinuation of Rezdiffra led to a return of disease in both F2 and F3 and also F4C patients. So I think that, you know, more and more the belief is that this is a chronic disease. And, you know, you just you cannot stop the medicine even if you have a response because you will have done all that hard work. And then you are just going to have disease come back. So we think that is how it is going to evolve in the future again, though. You know, look, it is early, but our belief is that this is a chronic therapy. That is the way the community tends to be using it. So we feel really, you know, quite confident that will be the case. So
Tina E. Ventura: Alright. Yeah. Maybe we will maybe we will end it there. Maybe, look. Just just maybe I will finish off just with
William J. Sibold: a remark of just kind of what is the state of the union, if you will. Rezdiffra is performing exceptionally well. This is truly a best launch I have ever been associated with, and I can tell you that is from a that is a factual perspective. Nothing is done as well as this. And it is poised for substantial long-term growth in a rapidly growing market. It is because of those two things that we can build a pipeline now to establish long-term leadership. Most companies have a pipeline looking for a great product, we have a great product. That is performing exceptionally. Is poised to perform exceptionally for the future, now we have a chance to build long-term leadership. It does not happen often. This is an opportunity. We are not going to waste the opportunity. So with that, we will close the call. Perfect. Thanks. Thanks, Bill. And thank you all for your
Tina E. Ventura: time and interest today. This now concludes our call. A replay of this webcast will be available on our website in about two hours. Thank you for joining us.
Operator: Ladies and gentlemen, thank you for your participation in today's conference. You may now disconnect. Have a wonderful day.