Good day, ladies and gentlemen, and welcome to Akebia Therapeutics Second Quarter of 2021 Financial Results and Business Update Conference Call. As a reminder, this call is being recorded. I would now like to introduce your host for today’s event, Kristen Sheppard, Senior Vice President of Investor Relations with Akebia.

Thank you, and welcome to Akebia’s second quarter 2021 financial results and business update conference call. Please note that the press release detailing our results for the second quarter was issued earlier this morning and is available on the Investors section of our website. For your convenience, a replay of today’s call will also be available on our website shortly after we conclude. Joining me for today’s event is John Butler, our Chief Executive Officer; David Spellman, our Chief Financial Officer; Dr. Steven Burke, our Chief Medical Officer; and Dell Faulkingham, our Chief Commercial Officer. Before we begin, I would like to remind everyone that this call includes forward-looking statements. Each forward-looking statement included in this call is subject to risks and uncertainties that could cause actual results to differ materially from those described in the statements. Additional information regarding these risks is described in the forward-looking statements section of the press release we issued earlier today, as well as in the risk factors and management's discussion and analysis sections of our most recent annual and quarterly reports filed with the SEC. The forward-looking statements on this call speak only as of the original date of this call, and accepted as required by law, we do not undertake any obligation to update or revise any of these statements. With that, I would like to introduce our CEO, John Butler. John?

Thank you, Kristen, and thank you all for joining us today. The first half of 2021 has been marked by significant milestones that have further strengthened Akebia’s position, and the potential market opportunity for vadadustat, setting the stage for an exciting and catalyst-rich year ahead for us. During the quarter, these achievements were highlighted by the publication of our global Phase 3 program results for vadadustat in the New England Journal of Medicine, and more recently, FDA acceptance for filing of the vadadustat NDA for the treatment of anemia due to chronic kidney disease, in both adult patients on dialysis and not on dialysis, with a PDUFA target action date of March 29, 2022. Putting all this together, as there are currently no approved HIF-PHIs to treat anemia due to CKD in the U.S., we believe vadadustat is positioned as a potential first-in-class product, and that these achievements bring us one step closer to having a novel oral therapeutic available for patients living with this disease. This is an exciting time in Akebia, and we believe we have a tremendous opportunity ahead of us, which is why I want to spend some time this morning and really remind everyone of the clarity of the global Phase 3 data for vadadustat, our clinical development program, and vadadustat’s potential market opportunity in dialysis, which we believe is now broader than originally anticipated. I also want to underscore the significance of our existing commercial footprint. We’ve established a strong reputation in the kidney community with our commercial product, Auryxia, and we look forward to leveraging both, our nephrology-focused sales force and our expertise upon the launch of vadadustat. And, of course, all my comments today regarding the launch of vadadustat, its adoption and use, are all subject to its regulatory approval. So, let’s begin. We believe strongly in vadadustat’s potential as a treatment for anemia due to CKD. And we’re excited with the prospect of having vadadustat lead a new class of therapeutics and help people living with this disease. Today, there are approximately 560,000 dialysis patients in the United States, a number that will continue to grow as the overall population ages. In general, this is a group of patients with significant health issues. Approximately 90% are being treated with erythropoiesis-stimulating agents or ESAs, to manage their anemia. The impact of this disease on patients with CKD is profound. In addition to the well-known symptoms of fatigue, dizziness, and shortness of breath, anemia has been associated with more severe adverse outcomes, such as cardiovascular complications, including left ventricular hypertrophy and congestive heart failure. Multiple large peer-reviewed studies have demonstrated the increased cardiovascular risks associated with ESA use in both dialysis and non-dialysis patients. Physicians and key opinion leaders associate that risk with the speed of hemoglobin increase and hemoglobin overshoots above their target level. These concerns were raised recently in the context of the FDA’s review of another company’s HIF-PHI product under development and their newly disclosed adverse event data. Well, we will not speculate on the outcome for their company or their data, we believe there are differentiating and important aspects of the global Phase 3 data for vadadustat and our program. As the vadadustat NDA is actively under review at the FDA, I’ll limit my comments to our public data, which fortunately, there’s an abundance of, and it’s published in one of the most reputable journals in the world. Our team has done a great job executing on our publication plans. First, our global Phase 3 clinical data show that once daily dosing of vadadustat increased hemoglobin in a gradual and steady manner. The data also showed that vadadustat minimized hemoglobin overshoots compared to darbepoetin alfa and ESA. We have been highlighting this treatment goal in the design of our studies for a number of years. And it’s encouraging to see this approach validated in the Phase 3 results across both, our dialysis and non-dialysis programs. I’d also like to remind you that our entire global Phase 3 program, including the starting dose used in both dialysis and non-dialysis programs, was designed after extensive dialogue with both the FDA and European regulators. This was a very significant undertaking, and we’re very pleased that it enabled us to align with regulators on the details of our statistical analysis plan, the pre-specified analyses, and the non-inferiority margins. We’re also grateful to have the support of the chairs of the Independent Executive Steering Committee for both INNO2VATE and PRO2TECT, doctors Chertow and Eckardt, and the entire committee, who have continued to ensure the ongoing quality of our program, as well as an objective, independent voice in data analysis and publication. Having the results of our global Phase 3 program published in the New England Journal of Medicine was tremendous validation of all of this work. We believe these publications not only reinforce the scientific rigor and quality of our program, but also speak to the clarity of the data for the broader medical community. This is one more tangible example of Akebia’s commitment to transparency. Feedback and interest in these publications from key opinion leaders and the broader kidney community continues to be very positive. We believe these publications will be highly informative for physicians, patients, dialysis providers, and payers, as they make important decisions about patient care, and potentially a key consideration when differentiating among HIFs in the class, as well as differentiating vadadustat from treatment with the assays. Importantly, as seen in the New England Journal publications, our global Phase 3 data showed no significant safety signal on adverse events, including thromboembolic events, seizures, and infections. More specifically, the data show that these events were very similar for vadadustat as compared to darbepoetin alfa in the dialysis and non-dialysis programs. We’ve provided the links to these journal publications in today’s press release, and of course, they are also available on our website. I encourage you to read these papers and the supplementary data as well as we believe they will provide a very clear understanding of vadadustat and our program. And of course, we have Dr. Burke, our Chief Medical Officer, on the call today to answer any questions you have about the journal publications. With vadadustat’s PDUFA date set for March, we’re progressing on the path to commercialization and are highly focused on pre-launch activities to ensure that we are well positioned for a successful U.S. launch in 2022, subject to regulatory approval. More recently, with the exciting potential for vadadustat to now be first-to-market, we’ve been expanding our planning to include a broader market opportunity in dialysis than originally anticipated. We believe dialysis represents a large and growing potential $2 billion market opportunity in the U.S. alone. We believe we have a clear path ahead of us in dialysis. And we’re confident that upon U.S. approval, we will have the potential to address the unmet needs of over 0.5 million adult patients on dialysis, and rapidly establish vadadustat as the new oral standard of care for the treatment of anemia due to CKD. We anticipate that the consistency and clarity of our dialysis data bolstered by recent publication in the New England Journal will play a meaningful role in helping develop treatment protocols within dialysis providers, which are critical to driving adoption in the dialysis market. We’re also conducting two studies, one led by our partner Otsuka to show that vadadustat can also be dosed three times a week. Assuming the data are positive, we expect to use this data to support the supplemental NDA for this dosing regimen post approval. Although the significant majority of dialysis patients are cared for in centers, several factors including the COVID-19 pandemic are supporting a growing shift towards home dialysis. Based on reports from the largest dialysis providers, home dialysis appears to be the fastest growing segment of the dialysis population. CMS is also creating payment models to encourage this move to home treatment. These trends are exciting as we believe that as a convenient once daily oral therapeutic vadadustat has the potential to offer an important value proposition, both to the growing number of home dialysis patients and to dialysis providers looking to better support these patients, simplify administration, and grow their home practices. With our planned commercial launch and strategic alignments, we believe that we can enable broad market access for patients and support rapid adoption of vadadustat in the dialysis market. As a potential first-to-market product, our go-to-market strategy now has a broad focus. Our plans include leveraging our exclusive distribution relationship with Vifor Pharma to access Fresenius Medical Care and certain independent dialysis providers which include up to 60% of the U.S. dialysis patients. Additionally, we plan to leverage our direct nephrology-focused sales force to facilitate adoption at DaVita and other strategically important dialysis providers that account for the remaining 40% of patients with our partner Otsuka sharing in the launch costs and responsibilities. Adding to this is a unique reimbursement model in the U.S. dialysis market with TDAPA and add-on payment to the bundle that’s intended to encourage adoption of innovative therapies by clinicians and dialysis providers. Although there’s limited market experience with the TDAPA process, our understanding of the process suggests it may take approximately six months from regulatory approval to TDAPA designation. Now, as TDAPA payments will continue for two years following TDAPA designation, we believe that the timing of TDAPA designation will be important to the rate of adoption. Again, as a potential first-in-class product, we now believe vadadustat has a broader market opportunity in dialysis than originally anticipated. And we believe we created a go-to-market strategy to support both our near-term and long-term growth potential in this market. Now, turning to non-dialysis. Consistent with our prior comments, while we remain cautious for approval in non-dialysis, we believe we have put forward a compelling and extensive NDA data package. And we look forward to continuing to work with the FDA in their review of the efficacy and safety data. We believe the patient need for a safe and effective oral treatment for anemia due to CKD is clear across both, the dialysis and non-dialysis populations. Now, shifting gears to performance of our existing commercial product, Auryxia. We’re encouraged with Auryxia’s performance in the second quarter. We continue to be pleased with how the market is viewing Auryxia’s strength. And importantly, the team continues to do a great job supporting our customers and patients, getting our therapies to those in need. We’re hopeful that as the industry continues to focus on prioritizing vaccines for dialysis patients, COVID-related hospitalizations and mortality will continue to decline. We continue to expect Auryxia to deliver annual revenue growth for 2021. And again, we’re excited to leverage this outstanding team with the expected launch of vadadustat next year. Finally, I’d like to share with you a number of potential catalysts that we’re focused on for 2021 and beyond. As our largest potential market, the U.S. remains our highest priority with vadadustat with a PDUFA target action date of March 29, 2022. We’re also continuing to collaborate with our partner, Otsuka, and expect to file vadadustat’s MAA submissions to the European Medicines Agency later this year. We continue to explore potential development opportunities from vadadustat and look to share more information on these efforts later this year. As we discussed previously, UTHealth is engaged in an ongoing investigator-sponsored study of vadadustat as a potential therapy to prevent and lessen the severity of acute respiratory distress syndrome or ARDS, in adult patients who’ve been hospitalized due to COVID-19. They currently have over 300 patients enrolled in this 400-patient study, and when possible, we’ll share an update on the study. We look towards additional presentations of our Phase 3 results and data, including multiple abstracts expected at ASN and at future medical conferences and in peer-reviewed journals. Lastly, as we move closer to the potential launch of vadadustat, we’ll also look to share progress on our pre-commercial activities. So, to briefly summarize, this is a busy and exciting time at Akebia. We remain confident in vadadustat’s potential as a first-in-class treatment for anemia due to CKD. And we look forward to continuing to engage with the FDA in their review of our NDA. I’ll now turn the call over to Dave, who will review our financial results. Dave?

Thank you, John, and good morning, everyone. As John mentioned, having laid the groundwork for potential approval, we’re advancing pre-commercial launch preparations for vadadustat. We believe we are well-positioned with our existing commercial footprint, and together with our partners, our team is fully engaged in the work to ensure appropriate commercial drug supply at the time of launch, subject to approval. Turning to our financial results for the quarter, starting with revenue. Total revenue was $52.9 million in the second quarter of 2021 compared to $90.1 million for the second quarter of 2020, reflecting lower collaboration revenue consistent with successfully completing our global Phase 3 clinical development program of vadadustat. In terms of Akebia’s commercial performance, net product revenue for Auryxia increased 7.4% to $33 million for the second quarter of 2021 compared with $30.7 million for the second quarter of 2020. We are encouraged by this growth, which we believe is a great illustration of our commercial team’s execution in this ongoing COVID-19 environment. We believe this performance also highlights Auryxia’s favorable product profile and the critical nature of this therapy. Looking ahead, we believe the team’s focus and execution on our marketing, sales, and payer strategies will continue to drive net product revenue growth. Turning to expenses. We continue to prioritize investments to support both vadadustat and top-line growth, while also continuing to focus on improving costs and advancing our pipeline of development opportunities. Cost of goods sold was $52.5 million for the second quarter of 2021 compared to $174.6 million for the second quarter of 2020. The current year includes a $30 million non-cash charge for excess purchase commitments, consistent with continued execution of our long-term care contract strategy, which remains focused on contract economics and net product revenue growth. Cost of goods sold for the prior year period included the impact of a non-cash impairment charge of $115.5 million related to the Auryxia intangible assets in addition to other charges noted in our press release for that period. Research and development expenses were $37.2 million for the second quarter of 2021 compared to $52.8 million for the second quarter of 2020. The spending reduction was primarily driven by a decrease in costs, consistent with completing the INNO2VATE and PRO2TECT global Phase 3 clinical programs. We expect that R&D expenses will remain significant, as we continue to support ongoing planned clinical work, as well as the cost of our supply chain and inventory build ahead of the expected approval of vadadustat. For clarity, we would like to remind you that consistent with the terms of collaboration agreements for regions including the U.S., Europe, Japan, and others, vadadustat supply chain costs are shared with our partners, respectively. Selling, general and administrative expenses increased to $41.7 million for the second quarter of 2021 compared to $35.5 million for the second quarter of 2020. The increase compared to the prior year period was due primarily to higher marketing expenses as we prepare for a potential launch of vadadustat, subject to approval. As our commercial team is already in place, we expect only a modest increase in SG&A for the remainder of 2021 for these efforts and Auryxia growth. For our bottom line, net loss was $83 million for the second quarter of 2021 compared to $175.8 million for the second quarter of 2020. The improvement in net loss compared to the prior year period was due primarily to the non-recurrence of the one-time impairment charge in the prior year quarter as well as lower operating expenses, partially offset by lower collaboration revenue for the second quarter of 2021. Turning to our capital position. We ended the second quarter with $247 million in cash, cash equivalents and available for sale securities. Our Q2 cash balance includes the impact of $37.3 million in net proceeds from sales of stock under our ATM in the second quarter. We also received $16.1 million in net proceeds from sales under the ATM subsequent to the quarter-end through July 16th. We believe that our cash resources will be sufficient to fund our current operating plan through at least the next 12 months. Additionally, we believe our cash runway would extend beyond that period, assuming timely regulatory approval of vadadustat and the receipt of associated regulatory milestones. With respect to future milestone payments to Akebia, I’ll remind you that subject to the terms of our collaboration agreements with Otsuka, Akebia has the right to receive milestone payments from Otsuka upon the approval of vadadustat in the U.S. and Europe. Given the tiered nature of these milestones, if vadadustat succeeds in being the first HIF-PHI to market in the U.S., the U.S. regulatory milestones from Otsuka are estimated to be $15 million and $50 million for dialysis and non-dialysis indications, respectively. Additionally, there are significant sales and commercial milestones. As a part of our existing R&D funding arrangement with Otsuka, up to 50% of these milestones may be used to offset accumulated R&D pre-funding, which today stands at $100 million. In addition, consistent with the terms of our license agreement with Vifor, Akebia has the right to receive a $25 million milestone payment upon U.S. approval of vadadustat and its inclusion in the Prospective Payment System, or TDAPA, whichever is first. With that, we’ll open the line to questions. Operator?

Thank you. Our first question comes from Chris Raymond with Piper Sandler.

It’s Ally Bratzel on for Chris this morning. I have a couple of questions regarding vadadustat in light of the roxadustat Advisory Committee meeting. First, could you address how the outcome of the roxadustat panel might influence the likelihood of the FDA convening a panel for vadadustat? Second, could you confirm whether your MACE analyses for vadadustat were conducted on an on-study basis rather than an on-treatment basis? This was part of our vadadustat plan in the indiscernible articles, but it was a topic of debate during the roxadustat AdCom, so I wanted to clarify. Lastly, regarding dosing, you observed a slower rise in hemoglobin for vadadustat in the INNO2VATE and PRO2TECT studies. This seems to support the dosing schemes in your Phase 3 trials. Can you share your confidence in the dosing protocol you've established that would meet regulatory acceptance? Additionally, how did the FDA's discussion regarding roxadustat’s dosing and the increased hemoglobin levels inform this? Steve, could you also share your perspective on the profitability of the three times weekly regimens you’re exploring with vadadustat? Thanks.

Good morning, Ally. Thank you for the questions. That was quite a lengthy list, so I hope I captured them all and we can address each one. We’re ready to respond to all your inquiries. Your first question concerned the likelihood of a panel for vadadustat. As we mentioned previously, the last communication we received from the FDA indicated that we shouldn't expect a panel. At this point, I don't think it's productive to speculate on whether it’s more or less likely. However, as we noted earlier, even before the roxadustat panel, we are planning and preparing for one. Should the FDA decide to hold a panel, we will be ready for it, but we have not received any updates on that front. Your second question was regarding the population for the analysis, specifically if it was an on-treatment or on-study analysis. I will now ask Dr. Burke to provide some insights on that. Steve?

Yes. As outlined in the New England Journal of Medicine publications, it was an intent to treat analysis in the safety population. So, if a patient was randomized and received a dose of study medication, we followed those patients until the very end of the global study completion date, at which time we announced the closure of the study and asked the sites to bring the patients back in further end of treatment and the study visit. So, it’s a pure intent to treat.

And I think that’s one of the strengths of the way we design the studies, and again, did that in consultation with the regulators. But, it was a true study where because you had an active control, you were able to continue to follow the patients. I think, your third question revolved around the dosing regimen and the gradual dose. And, again, I’ll pass it to Steve for that.

Right. The dosing regimen was designed in collaboration with the FDA, including the starting dose. It was designed to have a gradual and sustained increase in hemoglobin while minimizing hemoglobin overshoots, rapid rise in the hemoglobin. And this is described in the New England Journal of Medicine paper.

We have consistently communicated our discussions with the FDA regarding our starting dose in the Phase 2 studies, which was initially set at 450 milligrams a day. However, after consulting with the agency and addressing concerns about a rapid increase in hemoglobin, we decided to lower the starting dose to 300 milligrams for both dialysis and non-dialysis patients. The results have proven successful, demonstrating a gradual rise in hemoglobin and fewer overshoots. This reinforces our confidence in the efficacy data for both patient groups. Physicians prefer a steady increase over time, avoiding overshoots and maintaining hemoglobin within the desired range long-term. The FDA also shares this concern about overshooting. We believe the design of our program and the resulting data are solid. Regarding your third question about TIW, our studies related to that are ongoing and fully enrolled. Once the data is available, we will assess the viability of the three times weekly dosing. We did see potential for that in a small Phase 2 study. In the meantime, we are confident in the safety and effectiveness of our once-daily dose for dialysis, which will be our launch dose pending regulatory approval, as the data supporting it is quite compelling. Steve, would you like to add anything about TIW?

No.

Okay. Did we cover all your questions, Ally?

Yes. Thank you.

Thank you.

Thank you. Our next question comes from the line of Bert Hazlett with BTIG.

Could you provide more details on home dialysis and the TDAPA process? Specifically, what long-term efforts are being considered for home dialysis and what are the immediate priorities for TDAPA? Additionally, could you elaborate on your commercial sales force infrastructure following regulatory approval? Thank you.

Great. Bert, thanks for the questions. So, of course, home dialysis and TDAPA are both dialysis issues, but they’re so they’re related, but not exactly the same? And I’m going to turn to Dell to ask, maybe to start on home dialysis.

Yes, absolutely. Thanks for the question. We feel like we’re in a real position of strength, as you think about home dialysis. Clearly, our data is under review with the FDA. So, we’re not sure exactly what our final label is going to look like. But when you think about the clarity of our Phase 3 data, when you look at the things that John just talked about relative to the gradual steady rise, hemoglobin overshoots and I think then thinking about the dosing, it really does align very well with the home dialysis population. And this is a population that is growing at about 15% a year right now. It’s the fastest growing segment of the market. And we feel like that vadadustat is really well-positioned upon approval to drive rapid adoption there, through the dialysis organizations. I think, to speak to your second question…

I want to highlight the shift towards home care. Dell accurately pointed out that we are dealing with a growing population, with centers still hosting the majority. However, all current initiatives are aimed at providing patients with more options and facilitating their transition from centers to home. The COVID pandemic clearly illustrates the importance of this shift. Previous small studies indicated a mortality rate of 20% to 30% within the dialysis population, which underscores the challenges of having patients in centers. The CMS is implementing various payment programs, including the ESRD Treatment Choice program, to encourage dialysis providers to transition patients to home care. This segment is poised for significant growth. We believe that vadadustat will be effective in both home and center settings, but home presents a notable opportunity for daily dosing. Additionally, TDAPA represents another critical opportunity for us. Although there is little experience with the TDAPA process, we feel confident in our understanding and expect to gain more insights along the way. Dell, would you like to elaborate on this?

Yes, our understanding of the rule is very clear. We believe that vadadustat will be eligible for TDAPA coverage, which will last for two years once approved. Our understanding is that the quarterly coding system will apply as soon as possible after approval. We estimate that there could be about six months before we receive TDAPA reimbursement, which we believe will be crucial for patient adoption as we launch and consider the revenue ramp for the product. Our commercial infrastructure is ready for a quick launch, supported by a team of approximately 142 people, most of whom are field-based employees currently supporting Auryxia. This team has significant experience in nephrology sales and a strong reputation among nephrologists and the dialysis community. The overlap in our promotion of Auryxia with dialysis patients experiencing hyperphosphatemia is substantial, giving us confidence that we have the right commercial leverage for a successful and swift launch of vadadustat.

I want to highlight the TDAPA process. We plan to launch as soon as we receive approval and will move through the TDAPA process swiftly. It's crucial for dialysis providers to access the drug right after approval so they can begin developing their protocols. These protocols are essential for successfully transitioning patients. The timing is favorable. We wanted to stress this process because, as Dell mentioned, the TDAPA reimbursement will significantly affect the speed of our ramp-up. I just wanted to ensure that was clear. Does that help, Bert?

Yes, that does. Just a quick follow-up if I could, actually just shift. With regard to manufacturing and CMC, are any of those issues gating items with regard to the progress of the NDA, just a quick one?

No gating items for us. Obviously, all of that was part of our NDA. And we’re confident we’ll have multiple drug products, drug substance manufacturers as our plan and that was included in our NDA. So, we feel fine about that.

Our next question comes from the line of Alethia Young with Cantor Fitzgerald.

Hi. Thanks for taking my questions. And congrats on the progress. This is Nina on for Alethia. We were wondering if you could just share some differences in the market dynamics for dialysis and non-dialysis in Japan, the U.S. and Europe. And also, if you could share how much more investment is needed for the dialysis launch, if approved in 2022, since you already have sales force broadly in place? Thanks.

Thank you for the question. I will discuss the market dynamics in general terms. The dialysis and non-dialysis markets in the U.S. differ significantly in terms of reimbursement and treatment. We have addressed this issue previously. Non-dialysis patients typically do not receive ESA treatment due to safety concerns, the challenges of obtaining the product, and its injectable nature, while dialysis patients are commonly treated with ESAs. In the U.S. dialysis market, we see opportunities for gaining market share, while the non-dialysis market is expanding in terms of potential. In Europe, compared to the U.S., the dialysis market is somewhat smaller, and it’s challenging to generalize because each European country has distinct characteristics. The UK has a small number of large dialysis centers, while Germany has many smaller ones. Additionally, non-dialysis patients in Europe are more frequently treated with ESAs, and safety concerns have not been as pronounced, with good access available. There are also more biosimilar products in the European market. In Japan, dialysis patients tend to be healthier compared to those in other regions because organ transplants are not culturally accepted. As a result, their outcomes are typically good and last longer. We are also focused on expanding the non-dialysis market in Japan. Dell, is there anything I missed?

No, I think you’ve covered it all.

I think the last question was the investment in the U.S.?

Dell, do you want to?

Absolutely. We believe that with our current commercial infrastructure, we are in a strong position to launch vadadustat. We are excited about the upcoming opportunities. Our sales organization has the right experience, and we anticipate that incorporating vadadustat into our portfolio will require only a modest investment beyond our current resources. We collaborate closely with Otsuka, and together we will develop a strategy to ensure a successful launch of vadadustat. Overall, we feel confident moving forward from a position of strength.

Thank you. Our next question comes from the line of David Lebovitz with Morgan Stanley.

This is Avatar Jones standing in for Dave this morning. I have a few questions. First, have you received any inquiries from the FDA regarding the causality of MACE events? If you have, how do you intend to address them? Secondly, aside from the rapid rise in hemoglobin, Roxa's panel has suggested that the MACE events may be linked to non-specific HIF inhibition. Can you provide any comments on vadadustat in that context? Lastly, do you have any updates on the status of Auryxia’s litigation and coverage? Thank you.

Great. Thank you for the comments. So, we are in discussions with the FDA. Now, it’s kind of the normal review process; won’t speak to the nature of them, because they look broadly. So, they’re very, very robust package. And again, we have confidence in the data. And so, we feel confident in being able to answer any of the questions that the FDA raises. So, commenting on a panel, or the fact that they brought up this idea that there may be non-specific HIF target effects. I think, it’s really important to look at the data. I think that’s what kind of where I think FDA will always land is, what does the data tell us? And we are very confident in the safety profile that we’ve generated with vadadustat. I don’t know if that data was driven because we have the right dosing regimen or because of the differences in the product. We have the data to support the safety and efficacy of vadadustat, and we believe that’s what matters. And we’ve always recognized the complexity of the HIF pathway and that before any of us who are in the room here today, were with the company, we selected vadadustat as product for development based on the characteristics that we’re going to give it the most kind of preference for increasing EPO and managing anemia. So, we’re really quite confident in the product. And we’re quite confident in the product because of the data that we generated. And then, the third question was around Auryxia litigation, and that is ongoing. And as soon as we have any further updates beyond that, we will update you.

Our next question comes from the line of Difei Yang with Mizuho Securities.

Hi, thank you. This is Dan Clark on for Difei. First question from us, has the feedback from the nephrologists community changed on the outcome of your competitor? We’d be curious to know anything you’ve heard regarding data versus ESAs and data versus other oral HIFs?

I think it's early in the process of communication, but we are very encouraged by our discussions with nephrologists. The advantage of vadadustat is that nephrologists can directly review the data published in the New England Journal of Medicine, which enhances the credibility of that publication. I believe we may not emphasize this enough. The lead authors of those papers in the New England Journal were the co-chairs of our Independent Executive Steering Committee for INNO2VATE and PRO2TECT. The analyses published in the New England Journal, how we abstract that information, and the presentations at scientific meetings have all been overseen and developed in collaboration with this independent steering committee. This brings great credibility to the data and the process, allowing us significant differentiation. I’m not sure if Steve or Dell would like to add anything.

Yes. I think, certainly recent market events create perceptions and some confusion in the marketplace. And we certainly hear that from nephrologists. But I think as the potential first-in-class product here, we have a lot of work to do, moving forward and ensuring that we are differentiating vadadustat from other HIFs and ESAs as well as ensuring that people are really clear on the unmet need, which we believe is still very substantial and nephrologists understand that as well.

That might have been the most important thing that came out of the AdCom was that hour of open discussion where you heard from patients both dialysis and non-dialysis patients about the need. And I think, I know the FDA heard that as well and sees the need here also. So, we’re encouraged by our position.

Just another quick one from us. As your commercialization plans materially change, I understand that you mentioned as a larger opportunity out there now following the AdCom, have you made changes to your commercialization plan following that AdCom meeting?

So, yes, I mean, I guess in fairness, the opportunity is still the same, the market still same. We just have the opportunity for us. I mean, Dell and his team are pretty excited about that.

Yes. We’re really excited about it. I think the opportunity to be first and to be a leader in the marketplace gives us the opportunity, as mentioned, to really differentiate ourselves from the other HIF products, as well as the ESA, and to really help build that unmet need in the marketplace, as John talked about. So, when you look at our overall commercialization plan, I don’t think it’s materially changed in customers that we’re working with in the marketplace, how we’re engaging with Auryxia today and how we plan to engage with vadadustat upon approval. But we certainly recognize the opportunity to be the market lead, as the first product to market potentially, and really, really excited about it.

And in relationship with Vifor still has a lot of power for us also. As we said that that’s what really moves the needle quickly for us in the dialysis community. So, yes, it’s an exciting time, it really is. The opportunity to potentially be first to market is kind of a game-changer for us.

Thank you. Our next question comes from the line of Eric Joseph, JP Morgan. Your line is open.

Assuming approval in both the non-dialysis and dialysis settings, can you just unpack a little bit more how the reimbursement and economic constraints differ between the two segments? And what that could mean for net pricing with vadadustat in the two segments? And then, perhaps separately, is TDAPA eligibility something that applies in the non-dialysis setting? Thanks.

They are two very different markets and different from a reimbursement standpoint. And I’ll ask Dell to walk through that.

Starting at a high level, the dialysis opportunity is primarily driven by contracts at the dialysis organization level. The TDAPA payment, for which we believe we are eligible, aims to promote the use of new and innovative products upon their launch. We believe the rule is clear, and it will cover patients included in the PPS bundle. There are additional payment groups, but the majority of payments are driven through dialysis contracts. In terms of the NDD population, it will follow a more conventional contracting process with payers and PBMs for product coverage. Given the significant unmet need in this area, we expect to secure coverage for our product, facilitating access and reimbursement. This will be crucial for us moving forward, and it's our main focus at this time.

Yes. As we mentioned earlier, I want to emphasize that we are cautious regarding the NDD indication due to the uncertain base. However, we still feel quite confident in the data we've submitted and will be prepared to launch in both areas. You had a second question...

TDAPA eligibility.

Yes. TDAPA eligibility was not applied to the non-dialysis setting.

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

Three questions for me. First, regarding the discussion on differentiation, we touched on the adverse events that were mentioned at the recent AdCom. Is there any quantitative data available about the EPO overshoots? Considering the emphasis on the rapid increase, do you have any specific data that you can reference, perhaps from the New England Journal, or could we anticipate looking for that at ASM as a potential follow-up publication or analysis? That’s one. Second, with the receipt of CRO on tenapanor for hyperphosphatemia, what are your thoughts from clinicians about its overall impact on the space and the potential effects on Auryxia’s growth moving forward? Lastly, I have a question about the regulatory milestones. I know we covered this in the prepared remarks, but I missed some of the details. Could you please repeat those? That would be very helpful. Thank you.

Ed, thanks so much for your questions. So first, on the AEs, we haven’t published the data on EPO, which is what we said is that it was clearly fewer overshoots to vadadustat versus darbepoetin. That certainly could be the basis for a publication later. And we do think it will be an important differentiator. So I think you were right to bring that up.

And that is all mentioned in the New England Journal publication.

Yes, it's mentioned. The data just isn't available at this point, but it would certainly make for an interesting publication on its own. Regarding your second question about the CRO for tenapanor and its impact, as a purpose-driven company focused on patient care, we welcome anything that can help patients achieve lower phosphorus levels and manage hyperphosphatemia. From that perspective, it's disappointing. We never considered it a direct competitor, but we expected that our products would be used together. However, we don't see much impact from that. Nonetheless, we believe in Auryxia's growth potential, and it will grow this year. Dell, do you want to add any comments on that?

No, I think there is a tremendous amount of room for improvement in patient outcomes, and so certainly, from an impact perspective in the space. But, as John said, we believe that Auryxia is an important part of that equation in improving outcomes. And it’s a foundational treatment for hyperphosphatemia and it has been for more than six years. And we have a lot of real-world efficacy and safety data that supports that. So, from our point-of-view, it hasn’t really changed our view of what we hope to accomplish with Auryxia. And we’re going to continue to execute against our commercial plans to drive net revenue growth moving forward.

Thanks, Dell. And David…

Yes, Ed, I can clarify the regulatory milestones. So, in the U.S., for a first HIF approved in dialysis, the milestone would be $15 million; and if we are the first HIF approved in non-dialysis, that would be $50 million.

Ladies and gentlemen, that concludes our Q&A session. I would now like to turn the call back over to Mr. Butler for closing remarks.

Thanks, Towanda. And thanks to everyone who joined us for the call today. As I mentioned, this is a very exciting time for Akebia. The potential to be first in class is really energizing the Company. And we’ll look forward to continuing to update you on our progress as we move through the year. Thank you.

Ladies and gentlemen, this concludes today’s conference call. Thank you for your participation. You may now disconnect.