Good day, everyone, and welcome to the Ardelyx Third Quarter 2025 Earnings Conference Call. Now I'd like to turn the call over to Caitlin Lowie, Vice President of Corporate Communications and Investor Relations. Caitlin, please go ahead.

Thank you. Good afternoon, and welcome to our third quarter 2025 financial results call. During this call, we will refer to the press release issued earlier today, which is available on the Investors section of the company's website at ardelyx.com. During this call, we will be making forward-looking statements that are subject to risks and uncertainties. Our actual results may differ significantly from those described. We encourage you to review the risk factors in our most recent quarterly report on Form 10-Q that will be filed today and can be found on our website at ardelyx.com. While we may elect to update these forward-looking statements in the future, we specifically disclaim any obligation to do so even if our views change. Our President and CEO, Mike Raab, will begin today's call with opening remarks and an overview of the company's progress during the third quarter of 2025. Next, Chief Commercial Officer, Eric Foster, will provide an update on the performance of IBSRELA and XPHOZAH. Justin Renz, Chief Financial and Operations Officer, will conclude today's prepared remarks with a review of the company's financial performance during the third quarter ended September 30, 2025, before we open the call to questions. With that, let me pass the call over to Mike.

Thanks, Caitlin. It's great to be here with all of you today to share our third quarter 2025 results. Another standout quarter for both IBSRELA and XPHOZAH. This performance demonstrates the power of our commercial model, the momentum behind our products, the exceptional execution by our team and the real-world impact that our differentiated therapies are having for both patients with IBS-C and for those with CKD on dialysis. We generated $105.5 million in product revenue during the third quarter, representing 15% year-over-year growth, a signal of strong demand across our portfolio. In January, I outlined 4 key priorities for Ardelyx this year: one, to accelerate IBSRELA's momentum; two, to execute on our XPHOZAH strategy; three, to build the pipeline; and four, to continue delivering strong financial performance. 10 months later, it is clear that the team at Ardelyx is delivering on these key priorities, and as a result, we're building real sustainable momentum. I'd like to provide a bit more detail on each of these areas. IBSRELA continues to outperform and is the foundation of our portfolio and the main engine for Ardelyx's future growth. IBSRELA set yet another record, generating $78.2 million during the third quarter, a 92% increase over last year. Demand growth is broad-based and demonstrates how vital this therapy is for patients. The IBSRELA team is doing an exceptional job expanding reach and deepening prescriber engagement and conviction. Every driver that has fueled our success remains strong: a passionate patient community, an engaged prescriber base, and a novel commercial strategy. We expect this momentum to continue through Q4 and beyond. As a result, we are raising our guidance, and we expect to generate between $270 million and $275 million in IBSRELA revenue this year. XPHOZAH also had an incredibly strong quarter, generating $27.4 million in revenue, a 9% increase compared to Q2. The XPHOZAH team is navigating this dynamic market with determination and agility as we execute on our strategy, ensuring patient access, strengthening clinical conviction among nephrologists, and driving prescription pull-through. XPHOZAH is a valuable component of our growth, and we expect its contribution to our business will only grow over time. Today's announcement of ARDX-10531, which we will refer to as 531, is the next-generation NHE3 inhibitor and marks an important milestone for Ardelyx as we reinvigorate our pipeline. We at Ardelyx pioneered NHE3 inhibition and with tenapanor, we have the only approved modulator of this pathway on the market. With 531, we may be able to unlock even greater benefits for patients. Early preclinical data demonstrates that 531 is a highly potent, highly soluble molecule that could open development opportunities across a broad range of therapeutic areas. Preclinical and manufacturing activities are underway in advance of a Phase 1 study. This investment in 531 reflects thoughtful stewardship of an important internal asset and is our first new development program in more than 3 years. We are committed to building a broad, sustainable pipeline, capitalizing first on an internal asset, while in parallel exploring external opportunities. As we build this pipeline, we are taking a disciplined and forward-thinking approach, identifying opportunities where Ardelyx can win. We are going to leverage our expertise, assets, and scientific clinical and commercial leadership to unlock value. 531 is a reflection of that approach, and I look forward to sharing more information on our plans for this molecule as we advance through the development program. Finally, I want to highlight our financial strength. With the meaningful revenues we expect to generate in 2026 and beyond, we're extremely well positioned to thoughtfully invest our capital in current commercial endeavors and to grow our pipeline. We are delivering on our 4 key priorities. We are driving meaningful impact for patients, and we are creating lasting value for shareholders. Before I hand the call over to Eric, I'd like to formally welcome Sue Hohenleitner to Ardelyx as our Chief Financial Officer. She's a remarkable leader who brings deep financial and strategic expertise to Ardelyx, and she's already making her mark. Challenging our thinking, strengthening our plans, and energizing our path forward. She's joining a highly experienced leadership team with the technical expertise, vision, and enthusiasm to lead and write the next chapter for Ardelyx. With that, I'm pleased to turn the call over to Eric, who will share his perspectives on our commercial performance.

Thanks, Mike, and it's great to be with you all once again. The commercial organization continues to operate at an exceptionally high level. Our commercial strategy is strong and continues to be the foundation of our success. We are focused on addressing areas of high unmet need, delivering first-in-class medicines, leveraging a targeted sales and marketing approach to both patients and prescribers, and investing in high-impact patient services programs to improve access. I'm excited to share with you today how this focus drove our performance during the third quarter, starting with IBSRELA. The strong demand for IBSRELA continued during Q3, leading to our highest demand quarter since launch. Additionally, we delivered record highs in the following areas: revenue was $78.2 million, posting 92% growth year-over-year. We continue to see the strength of our field sales force and the impact of our marketing initiatives, which drove us to new highs in new writers and total writers, reflecting growth in both depth and breadth of writing. This increase in writers also led to growth in new refill and total prescriptions. Once again, the increased and focused activity from our field access manager team resulted in improved pull-through rates. These results clearly indicate that our strategies are working and our strong momentum continues. We remain focused on the patient, the prescriber, and improving prescription pull-through so more patients can benefit from IBSRELA. First, the patient. IBS-C patients are incredibly engaged and consistently seek information and new options to address their unmet IBS-C symptoms. In fact, more than 75% of surveyed patients report that they continue to experience the symptoms of IBS-C despite treatment on a secretagogue. In contrast, patients report high satisfaction with IBSRELA. In a poster we presented earlier this week at the American College of Gastroenterology's Annual Scientific Meeting, 88% of surveyed IBSRELA patients reported treatment satisfaction. Further internal market research also suggests that when patients learn about IBSRELA, they are motivated to ask for the therapy by name, and when they do, physicians are highly likely to prescribe it. Our focus on the patient will continue. In some areas, we will increase our investment in targeted patient marketing efforts to support our future growth expectations. Next is the prescribing health care provider. The investments we have made in our field-based team and physician marketing efforts continue to demonstrate that HCPs are highly responsive to IBSRELA's safety, efficacy, and tolerability profile and its differentiated mechanism of action. Once again, we saw increased targeted activity from our sales team who drove expanded adoption and utilization. We maintain our focus on driving depth and breadth of prescribing among high-writing HCPs who are frequently seeing patients with IBS-C. Our messages are resonating, and the team will continue to drive clinical conviction and ultimately to identify and prescribe IBSRELA for those in need. Finally, prescription pull-through. The investments we are making in this area are delivering improvements across the patient journey. Our field access manager team increased their call activity during Q3, translating into increased rates of prior authorization approvals and resubmission approvals. We continue to look for ways to improve the patient experience, lessen the burden on HCPs, and help ensure that every patient who is prescribed IBSRELA gets on treatment. We are focused on addressing critical aspects of the patient and physician journey and maintaining and building momentum as we enter the fourth quarter. As I mentioned earlier, my team and I just attended the ACG Annual Conference, and we heard directly from many HCPs about the impact of IBS-C and the important role that IBSRELA is playing for their patients. We are committed to the patient community, and we continue to bring important science to HCPs with 3 posters presented at the conference. I'm incredibly proud of all this team has accomplished, and I look forward to a strong close to 2025 on our path to more than $1 billion peak revenue. Now turning to XPHOZAH. The team continues to execute and drive demand. In Q3, the team delivered $27.4 million in revenue, a solid 9% revenue growth compared to Q2. This demand-driven growth demonstrates a clear need among patients for XPHOZAH. Our strategy is anchored in access to XPHOZAH for all patients who receive a prescription regardless of payer. We are pleased that this strategy is working, and we remain confident in our long-term growth expectations. The team remains focused on driving clinical conviction among nephrologists to prescribe XPHOZAH for appropriate patients, encouraging prescriptions to be sent to ArdelyxAssist to ensure patients get on treatment and providing important resources to support prescription pull-through. Our steady and consistent progress is evident in the growth we see across a number of key demand indicators. Total writers grew quarter-over-quarter. We grew new refill prescriptions, which resulted in growth in total dispenses compared to Q2, including increased volume for both paid and patient assistance prescriptions. In short, more patients have access to XPHOZAH today than ever before. We also saw continued improvement in prescription pull-through following our investment in the field access manager team. Importantly, we saw a second consecutive quarter of growth in the non-Medicare payer segments. These are all very encouraging indicators, demonstrating that the momentum we experienced in the second quarter continues through the third quarter as a result of our strong commercial execution. We focus on expanding breadth and depth of XPHOZAH writing among healthcare providers and continue to place the nephrologists at the center of decision-making. We also connect with other stakeholders in the community, including dialysis providers, renal dietitians, and advocacy organizations that are important to patient care. We have a broad-based team focused across the patient journey and continue to engage with all stakeholders about the importance of XPHOZAH. I will be joining the team on Tuesday at the American Society of Nephrology's Kidney Week to engage directly with HCPs and learn from them about the value that XPHOZAH provides. We also have 3 posters being presented that will further support our efforts and will highlight the importance of XPHOZAH for patients with elevated phosphorus. Consistent progress will fuel a strong finish to 2025 for XPHOZAH and create a solid foundation for further growth next year and beyond. I am proud of this team and their efforts in this dynamic market. We remain confident in our long-term peak guidance of $750 million. Looking at the fourth quarter and into next year across our portfolio of products, we will continue to execute our strategies at a high level and create new opportunities for growth. We have the right team and the right focus. We're making a difference for patients and driving impact across the business, and we remain steadfast in our commitment to bring these important medicines to the many patients in need. I will now turn it over to Justin.

Thanks, Eric. Ardelyx delivered an impressive quarter with continued meaningful growth for both products and another record-setting quarter for IBSRELA. We thoughtfully invested to improve our commercial opportunities, restart our pipeline, and strengthen our balance sheet through significant top line growth. Starting with revenue. For the period ended September 30, 2025, we reported total revenue of $110.3 million, an increase of 12% compared to the $98.2 million we reported in Q3 of last year. The growth was primarily driven by an incredibly strong performance by IBSRELA, recording revenue of $78.2 million, an increase of 92% over the same period last year. The team's focus on driving increased demand for IBSRELA and improving prescription pull-through continues to drive this momentum. The performance was also a result of expected improvement in our gross to net deduction, finishing the third quarter at approximately 31%, a slight improvement over Q2. We expect IBSRELA growth to continue, and as such, we are raising our guidance and currently expect to finish the year between $270 million and $275 million in revenue. XPHOZAH delivered another solid quarter of growth, generating $27.4 million in revenue during the third quarter of 2025, an increase of 9% compared to the second quarter of this year. Our gross to net deduction of approximately 29% was consistent with the second quarter. Finally, you will note that we recorded $4.8 million in non-cash royalty and commercial milestone revenue during the quarter, a significant increase compared to previous quarters and last year. We are pleased to share that our partner in Japan, Kyowa Kirin Co., achieved year-to-date sales levels that triggered a $3.4 million payment, which will be passed along to Healthcare Royalty Partners later this quarter. Now turning to expenses. Third quarter expenditures were up compared to the same period of 2024, reflecting our investment in growth, and spending levels were consistent with Q2 of this year. R&D expenses were $18.1 million for the third quarter of 2025 compared to $15.3 million for the same quarter of the prior year. SG&A expenses were in line with our expectation at $83.6 million compared to $65 million we reported in the third quarter of last year, and reflects our continued investments in commercial activities to drive growth. Our net loss was approximately $1 million or less than $0.01 per share in the third quarter compared to a net loss of approximately $800,000 in the same period of last year. In addition, our third quarter 2025 results included $4.8 million in non-cash revenue, $12.7 million in non-cash stock compensation expense, and $2.2 million in non-cash interest expense. We are pleased to report positive quarter-over-quarter cash flow as a result of significant growth on the top line. We finished the quarter with a very strong balance sheet, including $242.7 million of cash, cash equivalents, and short-term investments. As I prepare to step away from the CFO role at Ardelyx, I would like to thank all the investors and analysts who I've had the pleasure to interact with over these past 5-plus years. I would also like to thank all of the Ardelyx team members who I've had the privilege to work with, and to all, I'm delighted to welcome Sue to the team. We've had the opportunity to work together in transitioning the various tasks over these past couple of weeks, and you will find her to be a strong and capable financial leader. I look forward to following Ardelyx in the future as I begin my next journey. With that, I'll hand it back to Mike.

Thank you, Justin, not just for the thoughtful commentary that you provided as you finish up your final quarter with us, but for your leadership, your partnership, and support of everyone at Ardelyx. Ardelyx's third quarter performance was a continuation of consistently delivering on our priorities. IBSRELA's strength is the foundation of our growth and the opportunities ahead for this business are significant. XPHOZAH remains an important contributor to our business. 531 is our reentry to product development, and our strong cash position demonstrates our focus on being prudent stewards of our resources while investing in growth. I look forward to sharing more updates on our progress in the quarters ahead. Elvis, you can now open the call to questions.

Our first question comes from Chris Raymond of Raymond James.

Best of luck to you, Justin. It's great working with you and I hope to continue in the future. I have a few questions. First, regarding IBSRELA, the SparxIT data stands out to me. You currently have a mid-teens share in the IBS-C market, but it seems that your first-line share is still in the single digits. Mike, you have a long way to go to compete with Linzess for first-line share, so could you discuss how frontline use is influencing your long-term plans and what strategies you are implementing to enhance that aspect? Also, concerning the 10531, I noticed you didn’t mention indications, possibly for a reason, but based on the literature and potential targets for a strong soluble molecule, there are significant indications like hypertension, heart failure, and possibly some diabetes-related indications. Are you considering a broader approach or more targeted indications?

Let me address the second part of your question first. We need to take small steps before we can move quickly in the long run. We are very skilled at developing NHE3 inhibitors, and the unique properties of these molecules, particularly one that is both soluble and potent, allow us to contemplate some of the opportunities you've mentioned. However, it's too early to discuss specific indications until we complete these initial phases. As I mentioned earlier, our ability to invest in NHE3 inhibition is a significant advantage for us. I want to preemptively address any questions that might arise; we are well-equipped to allocate resources and guide it through the development stages taking advantage of the IBSRELA platform. Regarding IBSRELA, I'll invite Eric to add his insights. As we've discussed previously, our clinical studies indicated its use as a first-line therapy. There is nothing in our label or clinical findings that restricts it from being considered first-line. The growth we are witnessing is entirely organic. When we initiated the commercialization of IBSRELA, we deliberately chose to market it as a second and third-line option because, regardless of our strategy with pharmacy benefit managers and formularies, we wouldn't be classified as first-line, which would not yield enough revenue to compete with existing first-line treatments. The organic growth we are experiencing is due to the effectiveness of the drug and the positive experiences of physicians prescribing it. There are millions of patients currently on GCC agonists, with over 80% dissatisfied with their treatment. Even if the market does not grow further, we can still meet our goals and projections. It’s crucial to understand that our commitment to achieving $1 billion or more in revenue depends on targeting second-line therapy, given the established patient base and the outreach efforts Eric and the team are executing. Eric, do you have anything to add?

Thanks, Chris, for the question. Yes, the only thing that I would add to that, Mike, is we're coming off a third quarter where we've got all-time highs in new writers and total writers. Clearly, we are doing a great job of expanding breadth and depth and utilization of IBSRELA. With that comes confidence in the product when they see the results and the impact that it can have with patients. As you mentioned, we know that more than 75% of the physicians or patients that are out there are continuing to experience symptoms, so they need something different. We remain committed to our strategy. We're pleased to see that it does get some utilization first line, as you noted, that we're indicated from a first-line basis, but we remain committed and very confident with what we saw in Q3 and the momentum that we're generating coming into Q4.

Next, we have Yigal from Citi.

This is Joohwan Kim on for Yigal. Congrats on the quarter. Maybe just 2 quick ones for us. I know you had commented on solubility and potency, but just wondering if you could provide a little bit more color on what 531 is hoping to solve that was suboptimal versus tenapanor?

Versus tenapanor is one way to look at it. When you have highly soluble gut-restricted drugs, you may have better penetration into the target of NHE3. Solubility matters to have a molecule do what it needs to do where you're trying to target it. Potency will bring you lower doses or better efficacy. That's exactly the preclinical work that we're embarking upon is to understand how best to leverage those qualities of this molecule. As I said in the previous question, it's premature for us to speak as to whether or not it is to answer questions that tenapanor can't or if there are other indications that make more sense to pursue.

Maybe just one more, if I may. It seems like IBSRELA is really continuing to take off due in part to the investment into the sales force. Just wondering, as you're seeing that there's still a big opportunity there, is there any consideration for perhaps increasing the sales force even further beyond what you had already done to reach that peak 750 as early as possible?

I would like to make a general comment and then ask Eric to provide more details. Each day, we consider where we can further invest in this growth and opportunity, particularly the benefits for patients and the organic growth related to moving into first line treatment. This is an effective drug that is helping many people, but there are still many who are not receiving assistance due to its limited reach. We have various methods to engage with healthcare professionals and patients, and we will continuously explore new and improved ways to expand our presence. Investing in these efforts, including the sales force, is always a priority for Eric.

Yes. Thanks for that question. As Mike said, we're constantly looking at the data to see where we can continue to drive growth and value. As we're looking at the sales force, just recall, we're now about 3 to 4 full quarters in with the expanded sales force. What they've done is really raised the bar. Right now, I've got great confidence in this team. We are well on our path to achieve $1 billion peak year sales. As we go into Q4, I feel really confident about where the team is. We'll continue to look at the size of the field team, but we remain confident there. Also just want to take the opportunity to remind you, it's not just the field team. We've got great marketing initiatives out there. We've got a wonderful field access manager team that's focused on pull-through. It's really a team effort out there that's driving the growth of IBSRELA.

Next, we have Roanna Ruiz from Leerink Partners.

A couple for me. One for thinking about IBSRELA. What pushes and pulls could impact your ability to reach the high versus low end of your new guidance? It did sound like you're making great strides with new and repeat prescribers as well. Could you give us a little bit more color like what's resonating there?

Yes. I mean I think the guidance reflects our confidence in what we are doing with all the questions you've heard previously. I think that increased guidance in the range that we've provided is to show you our confidence in what we're going to deliver this year. I think Eric can go into some more of the specifics around it, but that should speak for itself. I think, Roanna, you've noticed over the years that we've taken a pretty conservative approach in the way that we provide these numbers. What we do is give you numbers that we are confident that we're going to meet. That's been consistently the way we've approached it over the years.

Yes. Like I said earlier, I mean, we're very confident in the strategy we have. If you think a little bit about what I mentioned earlier, we know that there are millions of patients out there that have been on or are on secretagogue. Again, more than 75% of those patients continue to experience symptoms of IBS-C. What they need is something different. We know that this is a multifactorial disease. They need something that potentially offers a different mechanism with a proven safety and efficacy profile. I mentioned the poster at the American College of Gastroenterology that was just presented showing that more than 85% of the patients out there were satisfied with IBSRELA. We have a great opportunity out there to address a high unmet need in this patient population, and we continue to be confident with the strategy.

One question on 531. It did sound like it's just the beginning of building the pipeline. I was curious if there are any other targets or molecules that you're interested in or would consider? Is external BD also an option?

Well, yes, I mean, to the second part first is, as you know, just under 2 years ago, we brought in Mike Kelleher to lead our corporate development efforts. He and his team are always looking and speaking to opportunities that are out there. We will pull the trigger on things when the right thing is there for us. As I said in my opening comments, we're now at a place where we could look at these assets that we had sitting on the shelf because they're really good. Are there other ones? There may be, but our focus at this point for our internal pipeline generated pipeline is 531.

Our next question comes from Dennis Ding of Jefferies.

Congrats on the quarter. Two questions for me. One on IBSRELA. You guys are running trials in peds less than 18 years old. Can you help frame the size of that market versus the adults and if that is already accounted for in your $1 billion peak sales guidance? Also maybe comment on the timing of clinical trials to go into CIC? Then number two, on XPHOZAH, congrats on the progress there, but there's still quite a large gap between where XPHOZAH is now and the $750 million you guys are guiding. What are things that are within your control to really accelerate that?

Thank you for the question, Dennis. Initially, regarding IBSRELA and the pediatric trials, those trials are a commitment to the agency. When looking at total prescriptions for IBS-C, those include pediatric cases. The market we are targeting is relatively small, but any IBS-C medication factors into those prescriptions. We haven't specified whether we will rely on that to reach the $1 billion target since we are focusing on the total market we are addressing. For CIC, we haven't discussed any actions there, but as I mentioned in our last meeting in London, that is an option we would consider if we have the financial capabilities. Regarding XPHOZAH, it’s worth noting that by the end of last year, we experienced a 60% revenue loss due to a challenging market for patients relying on effective phosphorus management. This situation is substantial. Despite losing that revenue from the entire portfolio, we've still presented solid numbers, reflecting the strength of our team. We are confident in our goal to reach $750 million. To clarify, 1/3 of the total addressable market, which is about 220,000 patients, is essential to reach that target. Given the significant need shown by both payers and patients in the assistance program and the turbulence during the TDAPA period, we anticipate improvements once we move past this phase.

Laura Chico from Wedbush Securities has our next question.

This is Thomas on for Laura Chico. Just one from us. You discussed gross to net for 3Q earlier for XPHOZAH. Any thoughts on gross to net dynamics heading into 2026? How might this compare to 2025 levels?

Thank you, Thomas. Our gross to net was approximately 29% for Q3, and we do think that will be somewhat consistent going to Q4. We're not in a position yet to discuss specifics around 2026. Look for us to update that in early 2026.

Next, we have Matthew Caufield from H.C. Wainwright.

When we think about XPHOZAH and getting those prescriptions filled, should these essentially be primarily filled through ArdelyxAssist and the patient's pharmacy at this stage? Or are there scenarios where the drug could come through the dialysis center experience despite being external to the bundle, for example? Just trying to kind of best understand the patient journey there to access and growth.

Yes, sure. That's an important question, I think, to really understand how we can make sure that these patients have access. As we said earlier, we remain committed to access for these patients regardless of who the payer is. On the non-Medicare side, it's covered through their prescription benefit. ArdelyxAssist can adjudicate it, and they can also work with specialty pharmacies to deliver to the patient. On the Medicare side, ArdelyxAssist can fulfill that through our patient assistance program. Because we did not file for TDAPA, the dialysis organizations are not buying and billing it. Important to note, though, what we've seen is actually increased access when we think about patients, whether they're Medicare or non-Medicare, so more patients today have access to XPHOZAH than they ever have before. I think it's important to note that we've got a path to access for these patients, and we're continuing to be able to address the unmet need for them.

Our next question comes from Joseph Thome of TD Cowen.

Congrats on the progress, and let me add my best of luck to Justin. Maybe the first one on the new program. I guess anything that you can share on the profile of this drug, whether it's extended release? Or is there a way to, I guess, improve tolerability? Obviously, the NHE3 mechanism does result in some diarrhea. I guess, is that able to be modulated given that it's kind of...

Joe, great question. I mean those are obviously the things that you begin to explore in the preclinical work that you're doing. I mean we have obviously years and years of experience and knowledge around the translation of what you see in animal models all the way through to human experience. Obviously, that's one thing that we would look at. The benefit that we together have learned about what NHE3 inhibition does, right, it's blocking sodium. Fundamentally, that's what it does. Then it's tightening the junctions, gosh, and that's where it works in phosphorus. That was not predictable. Geez, it also has a benefit in pain, which one would never assume that, that was the case until you start the IBS-C work. Those 3 different things that this molecule, NHE3 inhibition does, does open a vista for lots of things to consider, contemplate exactly around the lines of what you questioned, but time will tell. It is early, early in the process, but we were excited to announce its development.

Yes, and a little bit related to that. I guess, maybe can you talk a little bit about why now is the right time? I guess, did you see anything preclinically that you can share that kind of triggered the announcement or anything in the field, I guess? Or is it just kind of continued progress and now I guess anything?

I mentioned this in response to a few earlier questions, but looking at our balance sheet, we haven't raised any funds for several years. The strength of our balance sheet is largely due to our progress with IBSRELA and XPHOZAH. We experienced a brief dip at the beginning of the TDAPA period, but we've since returned to a balance similar to what we had before that period, which is a remarkable achievement. This success signals to me and the team that we can start exploring additional opportunities to further develop the company. The decision to pursue 531 was a natural choice since we had substantial familiarity with it, and we initiated that pursuit. As I noted in my comments, this reflects our commitment to being responsible stewards of our capital, which is how we intend to proceed with our investments.

Our next question comes from Julian Harrison of BTIG.

It's great to see another beat and raise for IBSRELA. You're at more than 70% year-over-year growth at the lower end of the new range for 2025. I guess looking to next year and beyond, I'm curious to what extent you think this cadence of growth can persist? Then looking towards the intellectual property estate, are you at a point now where you can talk more about how you're exploring extending exclusivity potentially beyond composition of matter? Are there any pending patent applications that you would highlight as potentially being Orange Book eligible?

Yes, great questions. It is exactly what we are doing and should be doing to protect the franchise that we're building. Yes, of course, those things are all the things that we will contemplate and talk about when we can. I think what's important about your question is the growth that you see as you described for IBSRELA, the potential is spectacular, right? If you look at the number of scripts that we have compared to the market that's out there and the growth that is being driven by the need that's out there for the patients by Linzess and others, that is to our benefit over time. Our belief is that reaching that $1 billion is something that's well within our control or we wouldn't have said that we expect it to be there. I think as we gain and continue to gain more perspectives and guidance, we can provide more guidance on when and how that is achieved. We're excited about the future for IBSRELA and what we're doing now, certainly with IBS-C and hyperphosphatemia with XPHOZAH. This mechanism, these drugs are making a huge difference. It's the work that Eric and his team are doing to show that conviction in physicians and getting those prescriptions pulled through.

Next, we have Aydin Huseynov of Ladenburg Thalmann.

Congrats with a great commercial quarter. Regarding business development activities, just curious on the kind of assets you're looking for? Is it more like a GI space? Or is it more like an early-stage Phase I preclinical? Or would you prefer something like Phase III plug and play or complementary to your commercial portfolio?

The answer is yes to all of that at the right time, right? We're going to take some baby steps as we can begin to afford to do more. The natural thing is to look at therapeutic areas and the close adjacencies of the therapeutic areas that we're currently in. Like any biotech company, we're going to be opportunistic as something demonstrates itself. Me too is not very interesting. Even me better, not very interesting. I think this very special and unique way that we approach commercialization is a really important driver of the considerations that we have for things to bring in. That's the lens from which we look at things. I think in the coming year, for sure, you're going to be hearing much more of that as we get our legs under us and look at opportunities that we are confident that we will bring in.

I have one more general question. You're generating nearly $400 million in annual sales and provide long-term guidance of about $75 billion, yet your market cap is only $1.2 billion. What do you believe the market is underestimating: the long-term guidance itself or the outlook beyond 2033? I'm curious about your perspective on this.

I want to be completely open about this, and we've discussed it before. I believe there is a disproportionate focus on XPHOZAH, while our IBSRELA engine deserves more recognition. The growth and benefits it brings to our profits and operating cash, which we can reinvest in the business, particularly for expanding our commercial capacity, should be acknowledged. We will approach this expansion thoughtfully and carefully. Additionally, we are looking forward to other opportunities as we are close to generating the free cash needed to further develop the company. I feel we are not receiving the credit we deserve. Many analysts are predicting that at the end of exclusivity, we might make $1 billion, but there is inconsistency in how people view this product and whether it's being properly accounted for in their models. It’s our responsibility to work with all of you on this. I believe these factors indicate that we are starting to move away from being in the penalty box of needing to prove ourselves. We have consistently demonstrated our capability to meet and exceed expectations, and this represents a significant market opportunity, particularly for IBSRELA. As I mentioned earlier, XPHOZAH is part of that portfolio and will continue to enhance its contribution over time.

Next, we have Prakhar Agrawal of Cantor Fitzgerald.

This is Daz on for Prakhar. Could you comment on any potential tailwinds or headwinds in 2026 that we should be aware of for IBSRELA and XPHOZAH?

I can't identify any challenges. We are eager to see the impact of the bundle on these patients and to assist them to the best of our ability. The situation is considerable, and I believe it serves as a tailwind that will ultimately benefit us as we enter 2026 with this outstanding product. I foresee only positive factors for both products, not just because I am optimistic, but also because the information we are sharing indicates that we have favorable momentum that will help us achieve, at the very least, our projected peak guidance for both.

That concludes our question-and-answer session. With that, I'll turn the program back over to our host for any closing comments.

Thank you, everyone, for joining the call today. We entered the fourth quarter with confidence in our strategy and enthusiasm for the future. We have the medicines, the focus on execution, and the team in place to deliver on our vision of a healthier tomorrow for patients. I'd like to recognize our employees, the people behind every number that we share today. Their hard work, ingenuity, and resilience continue to drive our success. Together, Team Ardelyx is determined to make a difference. I'd like to end by thanking our shareholders for your continued trust and support. We remain focused on driving sustainable growth and creating long-term value for you. With that, we can close the call. Thank you.