Mirum Pharmaceuticals Inc (MIRM) 2021 Q4 法說會逐字稿

Good afternoon, and thank you for attending today's Mirum Pharmaceuticals Fourth Quarter Business Update Call. My name is Amber, and I will be your moderator for today's call. (Operator Instructions)

It is now my pleasure to hand the conference over to our host, Ian Clements, CFO of Mirum Pharmaceuticals. Ian, please proceed.

Thanks, Amber, and good afternoon, everyone. I'd like to welcome you to Mirum Pharmaceuticals fourth quarter and year-end 2021 conference call. I'm joined today by our President and CEO, Chris Peetz; our Chief Operating Officer, Peter Radovich; and our Head of R&D, Pam Vig.

Earlier this afternoon, Mirum issued a news release announcing the Company's results for fourth quarter and full year ended December the 31st, 2021. Copies of this news release and SEC filings can be found in the Investors section of our website.

Before we begin, I'd like to remind you that during the course of this conference call, we will be making certain forward-looking statements about Mirum and our programs based on management's current expectations, including statements regarding Mirum's business plans, development programs, strategies, prospects, market opportunities and financial forecasts and guidance. Mirum is under no duty to update these statements, and they are subject to numerous risks and uncertainties, and actual results could differ materially from the results anticipated by these statements. Investors should read the risk factors set forth in Mirum's 10-K for the year ended December 31st, 2021, and any subsequent reports filed with the SEC.

With that said, I'd like to turn the call over to Chris Peetz. Chris?

Thank you, Ian, and good afternoon to everyone joining us on the call today. 2021 was a banner year for Mirum and marked a significant turning point for both the Company and the Alagille syndrome community. Our LIVMARLI launch is off to a very strong start, as we deliver on our mission to provide life-changing medicines for rare diseases. Today, we will cover our accomplishments to-date, and our upcoming milestones with some brief prepared remarks and then take questions. Peter will share some launch details, and then, Pam will discuss our pipeline. And finally, Ian, will touch on a few financial highlights.

To start, I would like to remind people of the devastating need for treatment of pruritus and Alagille syndrome. This is the most burdensome effect of cholestasis in Alagille syndrome. It impacts daily life and sleep for patients and families and is a leading indication for liver transplant. The launch of LIVMARLI has introduced a crucial new treatment for cholestatic pruritus in these patients. Our label and our clinical data show the tremendous potential of LIVMARLI.

And the impact of the long-term data set with 6 years of treatment experience was recognized last year in the Lancet and with late-breaking presentations at AASLD, looking at event-free survival and transplant-free survival. The strength of the LIVMARLI clinical data and the hard work of our dedicated team is leading to great launch success.

We are pleased to report fourth quarter 2021 net product revenue of $3.1 million, and we anticipate the strength to continue throughout the year. Based on what we're seeing so far in 2022, we expect first quarter net product revenue to be at least $8 million and the full year to be at least $50 million. As a reminder, we estimate the overall total opportunity in Alagille syndrome to be more than $500 million in the U.S. alone, and the early experience in the market confirms our view of this.

We have built Mirum be a compelling business based not only on the U.S. opportunity, but with global reach. As the U.S. continues to grow, we expect to see approvals in Europe later this year and in certain markets into 2023. Also protecting the value we've built in the business, today, we announced the patent grant and U.S. Orange Book listing for LIVMARLI with coverage into 2040. Building further beyond the LIVMARLI commercialization, we have an exciting calendar of clinical readouts with data expected across all 5 of our additional programs over the next 2 years. And in short, we expect 2022 to be a truly remarkable year for Mirum and the patients we serve.

Now with that, I'll turn it over to Peter, who will provide an update on our LIVMARLI launch progress. Peter?

Thanks, Chris. We are proud of the initial results from our launch of LIVMARLI, the first and only FDA-approved medication for this disease. Today, I'll share further color about our $3.1 million net LIVMARLI revenue, what we're seeing in the commercial business, and why we're so excited about the growth trajectory. At first, it's important to note that there is no inventory in our reported product sales. thus, the revenue number is a true representation of demand.

Revenue is recognized when the patient receives drug. Also, approximately [60%] of dispenses in the fourth quarter were reimbursed, which exceeded our expectations and is indicative of strong performance on our market access team. We believe the proportion of reimbursed dispenses will increase throughout 2022. And in fact, we're seeing this happen already in the first quarter, and we expect to track towards approximately 90% of dispenses being reimbursed by year-end.

We are very pleased with this result and attribute our success both to LIVMARLI's strong product profile as well as stellar execution by the entire Mirum team, who brought a tremendous amount of passion, ingenuity and experience to this launch. Looking ahead, we believe that LIVMARLI has significant growth potential in the United States. We're encouraged by the high level of awareness of the treatment benefits of LIVMARLI, as evidenced by the breadth of physicians, who have prescribed LIVMARLI to-date.

Encouragingly, we're seeing very high refill rates and treatment compliance in the commercial setting. We expected this based on the feedback we are hearing both from physicians and caregivers of LIVMARLI's rapid and robust symptomatic improvement in this highly symptomatic disease. This is further enhanced by our Mirum Access Plus program, which is designed to maximize patient and family support to enable long-term treatment adherence. So putting all the dynamics together, we're seeing in the business, we expect net revenue of LIVMARLI to be at least $8 million in the first quarter of this year. And looking at the full year, a strong start gives us confidence we'll achieve at least [$15 million] for 2022 LIVMARLI net product sales.

Turning to our plans for LIVMARLI's international launches. We remain on track for European approval in the fourth quarter of this year, and we have begun initiating commercial early access programs in Europe, and other international markets. In markets outside of Western Europe, our 7 commercialization partners are making excellent progress towards bringing LIVMARLI to patients suffering from Alagille syndrome around the world. In fact, we're excited to share that our partner GC Pharma recently filed in South Korea.

And much like what we've seen in the United States, prelaunch engagements with healthcare professionals and payers in international markets reveal both a high unmet medical need in Alagille syndrome, as well as receptivity to LIVMARLI's strong value proposition. Thus, in addition to the 2022 revenue growth driven by launch success in the United States, we believe, we are also well positioned for LIVMARLI revenue growth in 2023 and beyond, as international markets come online.

And now I'll turn -- I'll hand it over to Pam to provide an update on our pipeline. Pam?

Thanks, Peter. It has been an outstanding finish to 2021, where we have presented groundbreaking data first through the publication in the Lancet from our pivotal study in Alagille syndrome, highlighting the rapid and sustained symptomatic relief provided by LIVMARLI, followed by 2 late-breaking presentations at AASLD showing that LIVMARLI improved 6-year event-free and transplant-free survival as well as identifying predictive markers of event-free survival. Now, these data have reinforced our belief that LIVMARLI is a huge step forward for patients with Alagille syndrome. And we continue our efforts on research and analyses, as we remain committed to expanding our scientific knowledge and worldwide academic collaboration.

Now on the PFIC front, we're excited to have recently announced that we have completed enrollment in our MARCH Phase 3 study, and we expect top line data in the fourth quarter of this year. As a reminder, the MARCH-PFIC study enrolled all PFIC subtypes at higher doses than previously tested and is the largest randomized PFIC Phase 3 clinical trials and were conducted with more than 90 patients enrolled in the study. Now this is a remarkable achievement given the size of the PFIC population. Lastly, we're pleased to share that we have opened an international expanded access program for eligible patients with PFIC.

Now on Mirum's pipeline, we have 4 other indications, addressing cholestasis in both children and adults with several milestones ahead. In 2022, we're expecting 2 interim analyses from our volixibat program, one from our Phase 2b VISTAS study evaluating volixibat in patients with primary sclerosing cholangitis, and a second from our Phase 2b OHANA study for patients with intrahepatic cholestasis of pregnancy. In 2023, we're targeting interim data from our Phase 2b VANTAGE study evaluating volixibat in adults with primary biliary cholangitis, as well as primary data from our Phase 2b EMBARK study, evaluating LIVMARLI for children with biliary atresia. Now all of these upcoming milestones as well as our robust R&D pipeline and research efforts, puts us in a great position for continued growth.

And on that note, I will turn the call over to Ian. Ian?

Thanks, Pam. The press release and 10-K issued and filed today provide a full financial update. I'll call out a few of the highlights here.

In addition to the $3.1 million of net product revenues discussed, we recorded $16 million in licensing revenue from our partners in South Korea and China, bringing our total revenue number to $19.1 million for the year.

Our total operating expenses for the year were $192.6 million, which includes research and development expenses of $131.4 million, SG&A expenses of $59.2 million and cost of sales of $1.9 million. Of note, these costs include $18.9 million of expense for the Vivet option agreement that will not continue into 2022. And also $23.2 million of expense from regulatory and clinical milestones related to the multiple progress points across the programs last year.

Mirum remains well funded. And at the close of the fourth quarter ended December 31, 2021, we had cash, cash equivalents and investments of $261.5 million. Recall that in November of last year, we announced the sale of our priority review voucher granted by the U.S. FDA in September of 2021 with the approval of LIVMARLI for $110 million. This, with our growing top line contribution, puts us in a strong position to achieve critical milestones and expand our commercial presence over the next few years.

So with that, I'll turn the call back over to Chris for any final comments. Chris?

Thanks, Ian, and thank you, everyone, for joining today. To close, Mirum has made remarkable progress this past year, as we continue to advance treatments for devastating rare diseases. Our launch is off to a great start, and the Mirum team is energized by the stories we are hearing from physicians and caregivers on the impact that LIVMARLI is having on Alagille syndrome patients. Again, based on what we're seeing in these early days of commercialization, we have confidence in achieving at least $50 million in net product revenue this year. This will provide a tremendous base to our business, as a pipeline of 5 late-stage clinical programs matures. Thank you again for joining us.

Operator, please open the line for questions.

(Operator Instructions) Our first question comes from Jessica Fye with JPMorgan.

Just a couple. First, can you walk through the patient and reimbursement dynamics that underpin your expectation for at least $8 million of sales in the first quarter of 2022.

Yes. Quite excited about what we're seeing in the early days, and I'll let Peter speak to some of the dynamics underneath that number.

Yes. Thanks for the question, Jess. So on the patient side, we're seeing really strong adoption as noted by our net revenue number. I think it's important to note that the net revenue number we're providing here doesn't have inventory. It's a really direct and transparent view into what's happening at the patient level [if it's to be] [net account] is recognized as net revenue in our distribution model, the family actually assigning the LIVMARLI (inaudible). So it's giving you a direct view of what's happening there.

And on the reimbursement side, we've been really pleased with where we've gotten to the payers. I think this is a direct reflection of us kind of getting out there early last year, educating on the burden of Alagille syndrome, having those clinical discussions and what we expect by the end of the year to have 90% of our dispenses reimbursed. And as we kind of come into the year, we've seen coverage policies come down from several (inaudible) plans that are really in line with the LIVMARLI labeling and just kind of a lot of physicians to use this in line with that labeling, which is very broad.

Couple of follow-ups. How many current LIVMARLI patients were previously on expanded access? And can you talk a little bit more about the decision to launch the expanded access program for PFIC patients? And how much (inaudible) you expect to get there in the context of Bylvay already approved in that setting?

Yes. Thanks, Jess, for the question. I'll take the expanded access point briefly here, and then pass it over to Peter. And on the PFIC expanded access program, it's important to keep in mind that PFIC is more rare than Alagille syndrome. So we don't expect to see as many patients coming into that in total. But there are many countries, where the drug is not available. And also, as we've seen response is not universal to build those. So there is still an unmet need that we're seeing demand for.

Thanks to that. On the Alagille side, we have rolled over all of the Alagille expanded access patients in the U.S. to commercial drug. Important to note though that in Q4, the $3.1 million net revenue number, the majority of that was actually driven by de novo prescriptions. So the -- really, the clinical, [EAP] rollover is really the minority of that. And the majority of that just driven by new prescriptions and really encouraged by the broad prescriber base we're seeing. We're seeing broad participation in prescribing from across our 120 or so key accounts, as we launched, which we think is a real indicator of health.

And just the last one. Can you elaborate on what the new 647 patent covers?

Yes. So I mean, just briefly, it covers the use of LIVMARLI and Alagille syndrome at the label dose. And so I'm quite excited to see that grants and get listed in the Orange Book.

Our next question comes from Mani Foroohar with SVB Securities.

Congratulations on the process -- on the progress. So if I'm hearing you correctly, the $8 million for this quarter and [$63 million a year], is that exclusively U.S. sales? Or is there any probably adjusted European Japanese, et cetera, sales in there? And then secondarily, how should we think about modeling licensing revenue coming in from your partners will be -- is it the right way to think about the proportionate -- proportional relative to net product sales. Do you expect that it will be lumpier or how should we be modeling that?

I can start with the first question, Mani. Yes, while we are launching some of these commercial early access programs in international markets, as I mentioned, we expect that to be very small this year. And really 2022, you should think about as substantially all of the revenue will be coming from the U.S. But really excited about in 2023 and beyond what the international launches can mean for LIVMARLI revenue growth sustained over time.

Yes. And just to round it out on the licensing front, there will be some contribution from them, but relatively modest compared to the U.S. business. So that's the [$8 million] and $50 million that we talk about, that's from the U.S. business exclusively.

Okay. And I propose that $8 million. So what I'm hearing suggest that number is kind of form of the quarter, which suggests to me that it represents the revenue one would expect from the patients that you already have prescriptions for in hand. Is there some proportion of some -- some assumption around new patient adds between now and the end of the quarter also baked into that $8 million? Or is all of that incremental?

So the way we look at -- we're looking at those numbers is -- I'll borrow some of your language. It is in a sense of floor and what we're seeing in the business. That does assume some modest growth in prescriptions as well. But we're trying to give some of that transparency to what we're seeing in the business, which is really strong here in these early days. So kind of trying to communicate here from where we stand today, really early in the year, already comfortable on hitting those numbers.

Our next question comes from Steve Seedhouse with Raymond James.

This is Ryan Deschner on for Steve Seedhouse. I wanted to ask you guys if you give us a little more detail on the prescription volumes between large and small accounts for LIVMARLI. Interesting, any super prescriber account so far?

Yes. Thanks, Ryan. I'll pass it over to Peter to answer that one.

Yes. Thanks, Ryan. We've actually seen prescriptions from across the board. It's been really encouraging. We've seen some of the biggest programs in the country, the early adopters, and you've also seen that regional, current community (inaudible) hospitals already prescribers. So it's been a broad participation across our prescriber base.

And then just real quick, can you also comment on the duration of treatment that you're seeing so far?

Yes. And that's I think one of the -- as we try to get to in our prepared remarks, that's one of the real strengths here. What we're seeing is that the refills are really happening on a very kind of predictable pace every month. And the feedback we're hearing from physicians and caregivers is just really, really positive that they're able to see a rapid and robust symptomatic improvement with LIVMARLI compared (inaudible) which is, we think, one of the major drivers of the -- of those refills kind of occurring on a very predictable pace.

Our next question comes from Ed Arce with H.C. Wainwright.

Congrats on the early progress here. Three questions for me. Firstly, on the reimbursement. You've noted 60% of drug dispensed has already been reimbursed and you're targeting 90% reimbursement rate by the end of this year. Firstly, so just kind of walk through the process as that improves throughout the year, what particular things need to happen and kind of walk us through that process?

Secondly, is -- just commentary around the penetration across your targeted physicians. I think you said 120 key accounts, just some more detail around where that stands now and how you see it expanding throughout this year?

And then lastly, if you have this metric, it would be helpful. Just thinking about the time it takes between first writing the script to drug in the hands of patients?

Thanks. Those are all -- in Peter [shops], I'll pass it over to Peter [to walk through].

Sure. Sure. Thanks for the questions, Ed. So yes, on the reimbursement kind of [what we're trying] to get to ending the year with 90% of dispenses being reimbursed. And the first step is to ensure we have reimbursable pathways in place kind of a way to get reimbursed. Generally, the 2 categories of those either [plan or have a policy] or they'll handle a rare disease drug like this through medical [exception]. By the end of Q1, we expect 100% of Alagille life in the U.S. to have a pathway to get reimbursed.

And then the next step after that is ensuring high quality of coverage, and that's kind of mentioned that the policies we've seen so far from the bigger plans have just -- have been really very favorable and very much aligned with the evidence that's in the literature for LIVMARLI and the labeling by the FDA. So that's really -- those are really kind of ensuring the quality of access is there, now that we have a pathway for all Alagille patients in the U.S. is really the next step and are hard working to pull those through to pay dispenses. So that's probably -- that's really what needs to happen on the reimbursement side.

I think your second question was about kind of penetration. We have seen a significant number of the 120 accounts prescribed. And kind of the pattern you can ask, what is it going to -- how is it -- what is it going to sort of expand that. The pattern we're observing in the early days is usually a new physician that hasn't prescribed LIVMARLI before will prescribe, often to maybe 1 or 2 of their kind of most phenotypically severe patients, gained comfort with the medicine based on that initial trial, and then we see kind of expansion, as that experience kind of unfolds in those accounts. So that's kind of how we see those dynamics playing out.

And then finally, you asked about prescription to fill. And there, we're seeing the average time from a prescription received to fill being a couple of weeks on average. In some cases, this is fastest days. We've seen some [grow out] really fast. In other cases, obviously, longer than that. And that's something that we hope to continue to be able to work on as we go through the year. But really, really happy with where we're at there as well.

Our next question comes from Josh Schimmer with Evercore.

Just one on volixibat for ICP. Maybe you can give us a sense of what we should be looking for in the interim Phase 2 analysis later this year. And what do you think approvable endpoints for that indication are likely to be?

Thanks, Josh. I'll let Pam work through that.

Yes. Thanks, Josh, for the question. So for ICP, we know the FDA the approvable endpoint is pruritus and so targeting that, but it's a little bit of a different disease setting. These women not only have pruritus and as well as elevated serum bile acids, but there's also harm to the fetus with very elevated serum bile acids. And so on that front, we know that every increase in serum bile acid micromole per liter is an increased risk to the fetus. And so frankly, any reduction in serum bile acids that we see in this study is going to be meaningful for the fetus and obviously, those reductions in serum bile acids will be meaningful for pruritus. So we expect open-label interim data later this year and looking forward to reporting that out.

Our next question comes from Brian Skorney with Baird.

This is Luke on for Brian. For the MARCH-PFIC readout, can you remind us of the [powering] assumptions on the observed its primary endpoint?

And then is there a level of improvement on pruritus and serum bile acid reduction that you believe could provide a meaningful commercial advantage as a power in the space?

Thanks for the question. I'll let Pam set some expectations on what we're thinking about for data and powering.

Yes. So with regard to the study the MARCH-PFIC Phase 3 study, we're really excited about that. As I mentioned, we've got 90 patients enrolled in this study across all PFIC subtypes. And I think a really important factor in this study is that we are going to much higher doses than what we've done previously in our Phase 2 INDIGO study. And in that study, if you recall, when the dose was doubled, we had an increased rate of response. And so what we're hoping for is that even with higher doses, we'll see an increased response rate across PFIC subtypes, and that will be reported out top line data later this year. And then yes, so I don't know anything else to add there, but that's -- we're really excited about that data and looking forward to reading that out.

Our next question comes from Yasmeen Rahimi with Piper Sandler.

I have few for you. Maybe the first one to start off is, can you comment on if you're seeing any scripts being filled off label for PFIC or other cholestatic diseases. Two, can you actually quantify sort of the compliance rate that you're seeing in the real world other than maybe describing it to the extent you can. And then the third one is in regards to the volixibat readout, especially on VISTAS and OHANA that are both due in the fourth quarter, as well as, I guess, MARCH-PFIC in the fourth quarter, like how do we really get comfortable that the data is really coming in the fourth quarter and that were not notified that it could push into first half of 2023. Like just kind of provide some color or some metrics that give us really comfort that this is the time line at which top line data is going to be expected?

All right. Thanks for your questions. I'll touch on the first couple, and then, I'll ask Pam to speak to the volixibat and MARCH timing. I think first on off-label, it's really insignificant. So we're not seeing any notable off-label prescriptions. And compliance rate, put an actual number on it this early in the launch, we think it's just -- it's premature. But I'd tell you it's strikingly supportive. It's really a highlight of the launch and what we're seeing so far.

As we get further in and you have more of that longer-term treatment, similar to what we see in our 6 years of clinical follow-up, that's when I think will be more relevant to get a view of that. So throughout the year, we expect that compliance and persistence to be a real highlight in supporting the early success in the full year numbers. And let Pam speak on pipeline timing?

Yes. Thanks, Yas, for the question. So really excited about our [outlook] for that program, so I'll start there. The first data will be on the PSC VISTAS study in an interim analysis expected later this year. And what we've seen so far is that patients are rolling into the long-term extension portion of the study, and they're staying on drug. So we view that as a really strong signal of the study effect and excited to share that data later this year.

For ICP, we continue to push forward in this setting. There are some enrollment challenges on the backdrop, as you can imagine, of COVID and pregnancy, but we're working to address those by making adjustments to the protocol as necessary and operational adjustments as needed. And for PBC, interim data is expected in 2023.

And on the MARCH-PFIC Phase 3 side, we have completed enrollment for the study. So it's a 6-month primary endpoint. Enrollment is done. So you can wind the cost forward and certainly, top line data will be shared this year.

There are currently no additional questions reading at this time. So I will pass the conference back over to Chris Peetz for any additional remarks.

Great. Thank you, operator, and thanks, everyone, for joining. Your support makes the advancement of our important medicines possible. We will talk with you next quarter. Goodbye.

That concludes the Mirum Pharmaceuticals Q4 business update call. Thank you for your patience. You may now disconnect your lines.