Akebia Therapeutics, Inc. Q1 FY2026 Earnings Call

Good day and thank you for standing by. Welcome to Akebia's first quarter 2026 financial results conference call. At this time, all participants are in a listen-only mode. After the speaker's presentation, there will be a question and answer session. To ask a question during the session, you will need to press star 11 on your telephone. You will then hear an automated message advising your hand is raised. To withdraw your question, please press star 11 again. Please be advised that today's conference is being recorded. I would now like to hand the conference over to your first speaker today, Mercedes Carrasco. Please go ahead. Thank you, and welcome to

Akibia's first quarter, 2026 financial results and business updates conference call. Please note that a press release was issued earlier today, Thursday, May 7th, detailing our first quarter, 2026 financial results, and that release is available on the investor section of our website. For your convenience, a replay of today's call will be available on our website after we conclude. Joining me for today's call, we have John Butler, Chief Executive Officer, Nick Grund, Chief Commercial Officer, and Eric Ostrowski, Chief Financial and Chief Business Officer. Dr. Stephen Burke, our Chief Medical Officer, will also be available during Q&A. I'd like to remind everyone that this call includes forward-looking statements. Each forward-looking statement on this call is subject to risks and uncertainties that could cause actual results to differ materially from those described in these statements. Additional information describing these risks is included in the financial results press release that we issued on May 7th, as well as in the risk factors and management discussion and analysis section of our most recent annual and quarterly report filed with the SEC. that, I'd like to introduce our CEO, John Butler. Thanks, Mercedes, and thanks to all of you for

joining us this morning. We are very pleased and excited by the start to 2026. I want to focus on three key areas that we feel we need to execute on to create near and long-term value for patients and shareholders. First, we have to drive the near-term launch performance of Vafsio. Second, continue to build the clinical evidence to make Vafsio a standard of care for patients on dialysis. And third, execute on our impressive kidney disease-focused clinical development pipeline. We've made important progress across each of these areas. Starting with the Vapcio launch, revenues were nearly $16 million in Q1, representing our highest quarter of Vapcio net product revenue to date and demonstrating the growth we expected over Q4 2025. We're pleased with the progress we're seeing within and across dialysis organizations as we expand the breadth and depth of prescribing and continue to educate the nephrology community on the benefits of FCO. We believe this growth is being driven by dialysis organizations that have chosen to implement an observed dosing protocol. Nick's going to expand on that important point and provide more detail on the quarter and trends we're seeing in 2026. Now, we continue to work to take advantage of the Tdappa opportunity for the balance of 26. Of course, we're already planning for the beginning of 2027 when Vafsio will enter the dialysis bundle. The ESA market today for patients on dialysis is estimated to be approximately $1 billion. This is the market we're competing in, where we continue to work to become standard of care. This leads to the second area of focus, building clinical evidence. And that body of evidence supporting the potential benefits of Vafsio continues to grow. The post hoc hierarchical composite endpoint analysis from our Phase III INNOVATE program in dialysis was recently published in the Journal of the American Society of Nephrology. The analysis demonstrated that patients treated with Vafsio in the INNOVATE trial experienced a lower risk of dying or being hospitalized than patients treated with the ESA comparator. During Q1, at the annual dialysis conference, we presented an economic analysis on the cost of hospitalizations for patients treated with vatidustat versus darbopoetin. That analysis showed that patients in the INNOVATE trial treated with vatidustat had 7.7% fewer hospitalization events annually, a 16% reduction in hospitalization days, and And based on Medicare cost data, a 14.8% lower annual hospitalization cost. We believe these data further support the potential benefits of managing anemia with Vasio and provide critical data to providers and prescribers making care decisions. We continue to share these important data with the medical and scientific community as we gear up for results from the VOCAL study expected by year end. is being conducted at DaVita Clinics to evaluate Vafsio dose three times weekly, and it contains a sub-study of red blood cell characteristics which we believe will further differentiate Vafsio's clinical profile versus ESA's. Vocal top-line data will be followed by results from the VOICE trial being run by U.S. Renal Care evaluating Vafsio versus standard of care on a hierarchical composite endpoint of all-cause mortality and hospitalization rates. Top-line data from voice are expected in early 2027. If positive, they further support the findings of the recently published wind statistics analysis. Both voice and vocal utilize a three-times weekly dosing regimen aligned with in-center dialysis treatment. Most dialysis organizations are systematically electing to move to an observed dosing protocol. We believe that shift is improving adherence and could lead to greater utilization over time. Now, shifting from VASIO to our third area of focus, our R&D organization has been highly productive in advancing our kidney disease pipeline, which we believe will be an additional and important value driver for the company going forward. Strategically, this initiative is a natural extension for us, as it leverages our expertise in kidney disease drug development, broadens our presence within the kidney community, and aligns to our purpose to better the lives of people impacted by kidney disease. In April, we hosted an R&D Day to review our pipeline with the investor community. We were joined by leading medical experts Dr. Jim Tumlin, Michael Holers, and Jonathan Barrett. During that event, we reviewed the preclinical data in focal segmental glomerular sclerosis or FSGS models and prior clinical data in diabetic kidney disease for perlisiguat, our soluble guanylate cyclase stimulator. This is an indication that has received increased attention as there's now an approved treatment specifically for FSGS. We view this as a positive development for patients and the field. And we believe perlisoglott could deliver a differentiated approach via a unique mechanism of action in this heterogeneous disease. Enrollment in our Phase II study is ongoing. We're targeting up to approximately 60 patients who are already on maximally tolerated background dose of ACEs or ARBs. The study will evaluate change from baseline in UPCR at 24 weeks as the primary endpoint. AKB097, whose generic name is Ebrebifus, or Ebre, is our tissue-targeted anti-C3D complement inhibitor. We believe this product candidate could have comparable efficacy to the most efficacious, currently approved complement inhibitors in a well-characterized pathway. Initial data suggests that Ebre quickly leaves the bloodstream, directly targeting the tissue of complement activation, in this case, the kidney. We believe this could avoid the increased infection risk you see with current products. We also believe this will allow EBRI to be delivered at a lower dose in a more convenient dosing regimen. As Dr. Barrett articulated during our R&D Day presentation, EBRI is a second-generation complement inhibitor. We believe these characteristics support the potential for EBRI to be a uniquely differentiated product in the market. We expect to initiate a phase to open-label basket trial in the second half of this year, evaluating ebrian IgA nephropathy, lupus nephritis, and C3 glomerulopathy. These indications represent a substantial market opportunity, and of course, we're evaluating additional indications to investigate as well. As part of the basket study, we'll be evaluating safety, tolerability, pharmacokinetics, pharmacodynamics, and effects on disease-relevant biomarkers, such as proteinuria and kidney Importantly, we expect the study to be designed to be able to demonstrate the efficacy and tissue targeting profile of EBRI. As a reminder, as the basket studies open label, we expect to begin reporting initial data in 2027. Lastly, this quarter we were pleased to announce the initiation of a Phase I study of AKB9090, our internally developed HIFPH inhibitor product candidate, with an expected initial indication the prevention of acute kidney injury associated with cardiac surgery. This randomized double-blind placebo-controlled SAD-MAD study is designed to evaluate safety, tolerability, and pharmacodynamics in up to 70 healthy adult participants, and top-line data from this program are expected in early 2027. Overall, we've had a strong start to the year, and we're making meaningful progress on both the commercial execution of VASIO and the advancement of a pipeline that we believe can support long-term growth. Now, let me turn it over to Nick for more granularity on the VASIO

launch. Thanks, John. Good morning, folks. Like John, I am encouraged by the growth potential for VASIO in 2026, which we believe is supported by our first quarter trends. While we ended 2025 with approximately 290,000 patients with prescribing access, the start of 2026 was when prescribing access translated to more widespread prescribing and more patients on therapy. I'll recap the quarterly results first and then explain what I believe is driving growth. With the move to observe dosing protocols across multiple additional dialysis providers, we are no longer receiving as much detailed data as we have in the past, but I believe we can still provide a very good sense of Vasio utilization and growth. Q1 brought a significant increase in the number of prescribers writing and patients on Vasio. Approximately 1,025 prescribers wrote a prescription for Vasio, which was approximately 28% higher than the number of prescribers in Q4 2025. Importantly, approximately 30% of those prescribers were from dialysis organizations other than USRC. Dialysis organizations' inventory remained relatively flat from Q4 2025 to Q1 2026. As you know, we reported Vasio inventory de-stocking in the fourth quarter of 2025, as a result of dialysis organizations transitioning to observed dosing protocols and the related shift in distribution from shipping bottles to patients' homes to stocking bottles at dialysis centers. From a patient perspective, we note a 60% increase in the number of patients on VASIO at the end of Q1-26 over the number of patients at the end of Q4-2025 to nearly 7,500 patients. The number of new patients starts in quarter one was the highest in any quarter since the initial quarter of launch. The majority of new patients began in March, so Q1 revenue reflects, at most, only one month of treatment for these patients. We believe increases in number of prescribers' writing and number of patients on Vasio are important indicators that adoption is broadening as more organizations implement Vasio treatment protocols that allow for greater access. Finally, I want to spend some time on adherence, and particularly the transition that dialysis organizations are making toward observed dosing protocol. By the end of the quarter, USRC had observed dosing protocols available in nearly all of their clinics, as did IRC and DCI. In quarter one, approximately two-thirds of all VASIO patients were being treated three times weekly, which we expect to continue to grow in coming quarters due to these protocol decisions. First, refill adherence rates through the end of March were approximately 86 percent for patients treated under an observed dosing protocol. We believe this will reinforce the dialysis organization's decisions to provide access to Vasio using observed dosing. Because of this expanded access, we anticipate the greatest opportunity for Vasio revenue groups will be among dialysis organizations that have implemented observed dosing and expect nearly all in-center patients across DOs to be on an observed dosing protocol by the end of the year. We are clearly seeing more patient starts at the Vita, though more slowly than at other dialysis organizations that have ramped up, and that remains our largest potential growth opportunity from a single dialysis organization. We believe the Vita will implement an observed dosing protocol in the second half of the year. To summarize, we are seeing encouraging signs in the underlying commercial indicators that matter most, including broader prescriber engagement, improved adherence in observing dose in patients, and increased prescribing at dialysis organizations beyond USRC, which all lead to a significant increase in patients on VASIO therapy. As prescribers continue to gain real-world experience with VASIO, and we generate and disseminate more data, we expect to further grow the breadth and depth of prescribing. Let me now turn it over to Eric.

Thanks, Nick. We're pleased to deliver a Vastio revenue growth this quarter as we continue our pursuit to make Vastio standard of care for the treatment of anemia and dialysis patients with CKD. I'll now provide an overview of our Q126 financial results as compared to the prior year. Total revenues, which are comprised of net product revenues and license and collaboration revenues, were $53.5 million in Q126 compared to $57.3 million in Q125. This decrease was driven by lower Eryxia revenues, which was partially offset by higher VASIO revenues. Of these amounts, VASIO net product revenues were $15.8 million in Q1 26, compared to $12 million in Q1 25, representing a 32% increase, with an even larger increase in underlying demand as evidenced by the strong Q1 patient growth Nick described, as well as by the fact that Q1 25 revenues reflected initial customer inventory bills. Eryxia net product revenues were $36.2 million in Q126 compared to $43.8 million in Q125, which was driven by lower Eryxia prices. Looking forward, we note that in addition to the authorized generic for Eryxia that has been on the market for the past year, an additional generic form of Eryxia has entered the market. This increased generic competition is consistent with our expectations and prior guidance. Accordingly, as we've previously communicated, we expect Eryxia revenues to decrease in 2026 as compared to 2025. Lastly, license collaboration and other revenues were $1.6 million in Q126 compared to $1.5 million in Q125. Turning to expenses, cost of goods sold was $12.3 million in Q126 compared to $7.6 million in Q125. This increase was primarily due to an increase in inventory write-downs, including as a result of excess and obsolescence and scrap, primarily related to orexia, during Q1-26. Of note, VAPCO-related CODs in both periods was derived from prelaunch inventory, which does not include the full cost of manufacturing, as a portion of those inventory-related expenses were recorded as R&D expenses in the period incurred prior to VAPCO's U.S. approval. R&D expenses were $14.8 million in Q1-26 compared to $9.8 million in Q1-25. The increase in expenses was driven by increased clinical trial activities related to prolific blood, which we are evaluating in FSGS, and AKB9090, which we are evaluating for the prevention of cardiac surgery-related acute kidney injury, as well as higher headcount-related costs. SG&A expense was $30.4 million in Q126 compared to $25.7 million in Q125. This increase was driven by higher headcount-related costs. loss was $9.1 million in Q126 compared to net income of $6.1 million in Q125. The change to a net loss in Q126 resulted from lower EURXIA revenues along with higher expenses this quarter as compared to Q125. Cash and cash equivalents as of March 31, 2026 were $162.6 million compared to $184.8 million as of December 31, 2025. The decrease in cash was driven by the net loss for the quarter, along with a decrease in working capital. We expect our existing cash resources and cash from operations will be sufficient to fund our current operating plan for at least two years. With that, we welcome questions.

Thank you. At this time, we will conduct the question and answer session. As a reminder, to ask a question, you will need to press star 11 on your telephone and wait for your name to be announced. To withdraw your question, please press star 1-1 again. Please stand by while we compile the Q&A roster. Our first question is from the line of Julian Harrison with BTIG.

Your line is now open. Hi, good morning, and congrats on the progress. First, I'm wondering if you could talk more about the prominent increase of patients on Vapcio in March. Did you see follow-through of that trend into April, and was there maybe a specific dialysis provider providers, accounting for most of that uptake. And then second, is SOSPARI's recent approval relevant at all to your enrollment efforts in FSGS? Can you maybe walk us through how you're thinking about enrollment dynamics going forward for your phase two trial?

Sure. Nick, do you want to take the first question?

Yeah. Thanks, Julian, for the question. You know, the increase in patients nearly 60 percent quarter over quarter really was across all of our DOs, the major ones. USRC continue to have increases as they've really moved to the observed dosing protocol in all of their clinics, which is really, as we've indicated in previous calls, allowed them to start adding new patients on without the complications of a lower adherence rate that we saw in the QD dosing scheme for in-center patients. In addition, we've seen some restarts at USRC, which I think is an important characteristic. Patients that previously were on QD dosing fell off, perhaps for compliance reasons, and now in a TIW or observed dosing regimen, that they're restarting them on therapy with VASIO, which is really important. IRC and DCI, really once they got their dosing protocols in place, if you remember that was in Q4, what we saw was a very, very aggressive and accelerated adoption of the product within their physician base. That advocacy that we're seeing at IRC and DCI is strong. DaVita also had significant growth in the period. They're lagging a bit behind the others. They're still under a QD dosing protocol, but we believe in the second quarter, in the second half of the year, we'll see them moving to an observed dosing protocol as well. And so really great growth across a number of our DOs. We point to diversification. So the diversification away from USRC is an important measure to see how adoption is progressing at other dialysis organizations.

It's good to see we have significant room still to grow at USRC, DCI, and IRC, where we have great momentum. We all know that the Vita needs to increase. And as Nick said, it's growing for sure. But I think it's that observed dosing protocol that's going to make all the difference in So stay tuned. But again, I mean, we're really pleased with the growth that we're seeing in the USRC, DCI, and IRC clinics and expect to see significant growth from them as the year progresses. And, you know, on the FSGS trial, yeah, I mean, we think it's really a positive thing for patients. And from a regulatory perspective, you know, you can see that FDA, and this is on Prolisiguat, your second question, you know, really is supportive of bringing, you know, new products for this patient population. We know, while everyone's excited the Sparsetan's been approved, we know this is not a product that's going to be all the difference in FSGS. so you know i'll i'll let steve comment but i i'll say steve and i were down at a an investigator meeting uh a few weeks ago um and i was incredibly pleased by how excited the physicians were about uh the opportunity for prolissaguat and the unique mechanism of action there and and we're pleased with the progress we're making um it is you know there are multiple products in development there. So it is a competitive space, but we're very pleased that they're as excited as they are about Berlisaguat, and we think that enrollment will progress. I don't know, Steve, is there anything you want to add? No, I just echo

what you said, which is the bigger issue in conducting clinical trials is competing with other sponsors for patients, so I don't think that Phil Sparey approval is going to have a significant... we haven't heard that it's having a significant impact in enrollment. I don't anticipate it will, just because it's, you know, slightly better than, you know, angiotensin receptor blockers or ACE inhibitors, and so the majority of patients are still not going to respond to that drug, and it's going to become basically just a background therapy like ACE and ARBS are. Very helpful all around.

Thanks again. Thanks, Julian, and Steve is not here in the room with us because he's down at the NKF spring clinical meeting, so I'm sure he's getting more feedback on our impressive pipeline

as well. Sorry, Lauren. Next question. Our next question comes from the line of Roger Song with

Jeffries. Your line is now open. Hey, team. Good morning. Thanks for the updates and thanks for taking our questions. This is Nabil on for Roger. So great to hear about the step up in patients and prescribers. And then regarding the first refill adherence at 86%, how should we think about that level as we – dosing scales more broadly across DOs, and then I have a follow-up.

Sure. Nick, do you want to take that one?

Yeah. You know, in previous quarters when we talked about PERS refill, the sample size was still relatively small. Now we're getting to the point where there are – we've gotten to a sample size or penetration of observed dosing where we see significant number of patients being – utilizing dosing protocols that have observed dosing regimen. And so I feel pretty confident about 86 is going to stick around there and may move a couple of points one direction or another direction. But there's no reason for us to believe at this point that it shouldn't apply as other DOs bring on. Now, every DO has a little bit different protocol, whether it be starting at 900 milligrams daily, how often they titrate up, whether they are coming from Mercero or whether they're coming from Epigen, but we've seen this consistent number here bouncing around between kind of 85 and 90 for the last couple of quarters. And so right now, we're really confident that that's how you should

think about it moving forward. Great. Thank you. And then as we think about BAPCO throughout the remainder of 2026, should we expect the growth to be more linear from here or more back half-weighted

as the protocol adoption matures? Thank you. Yeah. I mean, I don't know that we can guide that granularly to how it's going to go. As you see with 7,500 patients on the drug, there's lots of room to grow. We see great momentum at USRC. I think I'm particularly excited to see so many of the patients who went off of the drug last year with the adherence issues that they have being put back on and you know with the adherence rate staying on the drug you know how quickly that will accelerate you know these are all things that will will influence it but there's tremendous room to grow remember there's about 66 000 patients just between usrc dci and irc not all of them have a tdapa reimbursement but the access is quite good so lots of room just to grow there And then the question is, you know, how quickly does DaVita move? And, you know, DaVita has really taken the strategy of allowing physicians to make the choice, where at the others, it's more of a top-down push. You know, here are the patients that are available. You put them on and, you know, they do that over time, as I said, systematically. But, you know, it is different. It's kind of a more traditional adoption curve, which it's harder to, you know, to really kind of handicap exactly how quickly that's going to happen. but we know that pool is so much bigger that, you know, we need to tap into it. So I don't think we could say, oh, it's going to be linear, or there's going to be some, you know, hockey stick at the end of the year. But certainly once DaVita goes to a TIW protocol, you know, and we, you know, I mentioned like the Jason paper, the WinObs paper. Well, as I said, that was just published. Before it was published, our medical folks couldn't talk to physicians about it, right? Now that it's published, they're out there talking about it. Those are the kinds of data that do change shapes of curves. So, you know, but exactly how quickly that happens, that's to be determined. But, you know, we really are pleased with the momentum that we have in the market today.

Thank you for the caller, and congrats on that data update.

Thanks very much.

Our next question comes from the line of Matthew Caulfield with H.C. Wainwright & Co. Your line is now open.

Hi, good morning, guys. For listigwatt development and FSGS, what do you view as the most clinically relevant change for the 24-week UPCR primary endpoint? Is there a certain delta that will be the most clinically relevant there in addition to preserving the podocyte health and just the overall reduced protein area? Thanks a lot. Sure. Steve, do you want to take that question?

Sure. I think we would like to see something that's on par with what was seen with sparsentin, so something around a 20% improvement in the change in UPCR, so 20% over what's achievable with ACE and ARBs. I think the critical thing will be the proportion of patients who end up with a UPCR less than 0.7 grams per gram, because that's the approvable endpoint now for FSGS. So that will be really the key metric that will drive our decision to go into phase three or not.

Understood. Thanks, Steve.

Yeah, I think that, you know, obviously, you know, we think that's the bar, right? the Sparcentin bar for approval, but as Steve said, I mean, the Parasol findings really is encouraging that we have this clarity from the FDA around, you know, what we need to do to get the product approved. And again, given the heterogeneity of the disease, the uniqueness of our mechanism, you know, we really think that there's a place, there's about 60,000 FSGS patients in the U.S. You know, the approval of sparsent is great for patients, but there's significant room for new entrants. And, you know, again, hitting that clinical threshold will be critical for us. Thanks for the question, Matthew.

Yeah, thanks, guys.

Thank you. I'm showing no further questions at this time. I would now like to turn it back to John Butler for closing remarks.

Thank you, Lauren, and thanks again to all of you for joining us this morning. We look forward to continuing to update you on the progress we're making in the launch of Vafcio, building the evidence to support Vafcio's long-term growth, and the continued advancement of our robust kidney-focused pipeline. Have a great day, everybody.

Thank you for your participation in today's conference. This does conclude the program. You may now disconnect.