Biocryst Pharmaceuticals Inc Q1 FY2022 Earnings Call

Good day, and thank you for standing by. Welcome to the BioCryst Pharmaceuticals First Quarter 2022 Earnings Conference Call. Please be advised that today's conference is being recorded. I would now like to hand the conference over to your speaker today, John Bluth, Head of Investor Relations at BioCryst.

Thanks, Daniel. Good morning, and welcome to BioCryst's first quarter 2022 corporate update and financial results conference call. Today's press release and accompanying slides are available on our website. Participating with me today are CEO, Jon Stonehouse; CFO, Anthony Doyle; Chief Commercial Officer, Charlie Gayer; Chief Medical Officer, Dr. Bill Sheridan; and Chief R&D Officer, Dr. Helen Thackray. Following our remarks, we will answer your questions. Before we begin, please note that today's conference call will contain forward-looking statements, including those statements regarding future results unaudited and forward-looking financial information as well as the company's future performance and/or achievements. These statements are subject to known and unknown risks and uncertainties, which may cause our actual results, performance, or achievements to be materially different from any future results or performance expressed or implied in this presentation. You should not place undue reliance on these forward-looking statements. For additional information, including a detailed discussion of our risk factors, please refer to the company's documents filed with the Securities and Exchange Commission, which can be accessed on our website. I'd now like to turn the call over to Jon Stonehouse.

Thanks, John. With nearly $50 million in net revenue in the first quarter of this year, ORLADEYO quarterly sales continue to provide us with real-world evidence and confidence quarter after quarter that we remain on track for no less than $250 million in net revenue this year, and $1 billion in global peak sales. What's particularly important this quarter, as we face the expected headwinds from some payers requiring reauthorization, higher copay deductibles, and the impact of the Medicare donut hole, is that our team still tapped into strong patient and physician demand for ORLADEYO and produced quarter-over-quarter revenue growth. ORLADEYO plays a critical role in our strategy. The growing revenue stream is creating value by providing evidence our company can discover, develop, and commercialize successful products and by strengthening our financial position. There's plenty of opportunity to capture too. Charlie will go into more detail on this and talk about the steps we're taking to make this important medicine available to every HAE patient who wants to try it around the world. And why would they? If they had a chance to be controlled on one capsule once a day. So for the remainder of the year, we expect steady revenue growth over the previous quarter, culminating with an annual revenue of no less than $250 million. That's more than a doubling of the first-year sales and a quarter of the way to our $1 billion peak sales expectation in just the first two years of launch. Based on what we've seen so far this year, and the trajectory we're on, we remain very confident we can achieve these targets. Our pipeline is another important part of our strategy. Our team has made significant progress in investigating the serum creatinine increases in patients in our BCX9930 clinical trials since we first identified this a month ago. While the investigation is not complete, we believe the dose is the most likely cause of these elevations, and we'll work with regulators to see if there's a path forward to restarting clinical trials. Bill will share more details on this topic. Regardless of the outcome, patient safety is paramount to us in finding a safe and effective Factor D inhibitor. Many patients suffering from complement-mediated rare diseases are waiting. Whether it's 9930, one of our backups, or both, our goal remains to bring a highly competitive oral Factor D inhibitor to patients. We will follow the data and make thoughtful decisions on what to invest in, and what not to invest in, based on how it helps us reach this goal. Time to market, how the competitive landscape changes, and our product profile will also be important factors in our capital allocation decisions. When you step back and look at our company in its entirety, you'll see a company with a growing revenue stream coming from a product and a team that's showing they can execute and successfully launch a drug that we believe will grow to $1 billion at peak. We have a pipeline to create even greater value with the goal of bringing more products to the market for patients suffering from rare diseases. Finally, we have a solid balance sheet to allocate capital to things we believe can create even greater value. When you see all of this, you see meaningful value creation today and even greater value creation for the future. I'll now turn the call over to Charlie to talk about ORLADEYO.

Thanks, John. The first quarter was another strong one for ORLADEYO. The patient base continued to grow steadily, and even with the headwinds of payer reauthorizations, we finished with $49.7 million in ORLADEYO sales and are on track for no less than $250 million in sales for the year. We are confident about the growth trajectory because it is becoming increasingly clear how well patients are doing on ORLADEYO. We're seeing three cohorts of patients emerging: those who are doing great and stay on therapy, those who are still deciding if this is the best treatment for them, and those who decide it isn't. The size of each of these groups is fluid, but the group doing well and staying on therapy is by far the largest and is driving our sales growth. What we're seeing is that the patients most likely to do well and stay on ORLADEYO are those who were well controlled on injectable prophylaxis before switching. We are getting real-world evidence from our specialty pharmacy, showing the patients who were well controlled on TAKHZYRO at baseline, for example, are staying equally well controlled on ORLADEYO. These patients switching from TAKHZYRO represent a sizable and growing cohort because 50% of all patients on ORLADEYO in Q1 originally switched from another prophylaxis, and half of those came from TAKHZYRO. That switching trend continued for patients starting ORLADEYO in Q1 and shows no sign of changing. The real-world evidence is consistent with the 96-week data from our pivotal study showing that the median attack rate was zero in 16 out of the last 17 months of the trial. It is also consistent with data from our long-term safety study showing that patients switching from injectable prophylaxis were attack-free in over 80% of months on ORLADEYO. Further evidence of how well patients are doing is that after switching to ORLADEYO, and the prior authorization processes are complete, 78% of TAKHZYRO patients and 73% of Haegarda patients continue on ORLADEYO for at least six months. Patients switching from acute-only therapy have similar retention. We're also seeing that access and reimbursement correlate with long-term patient retention. Overall reimbursement access improved in Q1, and now nearly 80% of patients on ORLADEYO are on paid drug, up from about two-thirds in the second half of last year. This improved access is important not only because more patients are receiving paid therapy, but also because we are seeing that 70% of patients who reach paid therapy continue on ORLADEYO for at least 12 months compared to 60% retention for patients who remain on long-term free product. We believe the size of the patient cohorts I described is fluid because some patients are making their decisions about ORLADEYO too quickly. One-third of all discontinuations to date have occurred after just one shipment, and 50% overall within the first two shipments. Education and expectation setting are critical in the early phase of treatment. We have added new members to the team to support patients in this process. If a patient has a high probability of doing well, for example, those well-controlled prophylaxis switchers, we want to ensure they don't give up too quickly after an early breakthrough attack or side effect because they might miss out on the long-term benefits of ORLADEYO. The clinical trial and real-world evidence that I described is convincing physicians, leading to greater breadth and depth of the ORLADEYO patient base. In the first quarter, new patient prescriptions were evenly split between new prescribers and repeat prescribers. We also saw an even split in new prescriptions coming from our Tier 1 top 500 HAE treaters and the broader base of treaters. Our latest quarterly survey with allergists matches the prescribers' prescribing trends and tells us how much more opportunity remains. We surveyed another 60 allergists who treat an average of eight HAE patients. They were already prescribing ORLADEYO to 13% of their patients and predicted growth to 23% over the next 12 months, neck and neck with TAKHZYRO for future market leadership. We expect favorable patient outcomes, new prescription trends, and improved reimbursement to drive steady quarterly growth on our way to no less than $250 million this year. The patient growth trends we see give us confidence that at peak, we will reach a stable base of at least 2,000 patients in the U.S. who have great outcomes on ORLADEYO. That's just 25% to 30% share out of the 7,500 diagnosed and treated patients and would generate up to $800 million in annual sales from the U.S. alone. As we've noted before, the U.S. will account for the great majority of sales in 2022, but international launches are gaining momentum. We have launched with our own team in Germany, France, the U.K., Norway, Sweden, and Denmark and with partners in Japan and UAE. We anticipate several more launches and reimbursement approvals this year. We are busy preparing multiple regulatory and reimbursement submissions. The favorable reception that ORLADEYO is getting from regulators, payers, physicians, and patients across countries and regions bodes well for our strategy to bring ORLADEYO to patients around the world on our way to $1 billion in peak global sales. I'll turn the call over to Bill for an update on our clinical program.

Thanks, Charlie. While we have not completed our investigation into the serum creatinine elevations we observed in our BCX9930 clinical program, we have made significant progress. I want to provide an update for you today on what we've learned thus far, and what the next steps are. At the time we announced that we were holding patient enrollment in April, we had four active clinical trials with BCX9930. These are summarized on Slide 4. Patients in REDEEM-1 and REDEEM-2 randomized to 9930, and patients enrolled in RENEW began the trials by starting immediately at 500 milligrams twice daily. Patients in the long-term extension for our proof-of-concept study started at lower doses, and all patients were ultimately moved up to the 500 milligram dose. We currently have three patients from our REDEEM trials, who had severe or moderate elevations in their serum creatinine, beginning several weeks after starting BCX9930 at the 500-milligram dose level. These lab findings indicated renal injury, which is why we proactively paused enrollment to investigate further. Two of the patients were hospitalized for observation and evaluation, and both were discharged after their initial evaluation. These three cases involved a rise in serum creatinine of about 2 to 4 times the upper limit of normal. We're pleased to see that kidney function has improved in all three patients with a fall in their serum creatinine levels during the short period of observation thus far. Two of these patients have been discontinued from therapy, while the patient who had the smallest rise in serum creatinine continues on BCX9930 at this time. These three patients we noted with early onset increases in serum creatinine represent approximately one-third of the patients randomized to 9930 in the REDEEM studies. Other patients in the REDEEM trial for serum creatinine have remained similar to baseline. Additionally, during the investigation, we learned that about 40% of the patients in the long-term extension study had slowly evolving late-onset, mild to moderate increases in serum creatinine, which started about 3 to 12 months after they switched to this 500-milligram dose. This was not observed during treatment with doses lower than 500 milligrams, and none of these patients experienced early onset severe serum creatinine elevations. So, here is the summary of what we know so far. We are observing an emerging signal of increasing serum creatinine early during treatment and also after chronic treatment. Although there may be other factors contributing to these events, it is prudent to assess this signal as probably related to BCX9930. It is noteworthy that we have not seen elevations of serum creatinine at doses lower than 500 milligrams. We have not seen early-onset increases in serum creatinine when starting with a lower dose. In the proof-of-concept study, we have also seen that BCX9930 has encouraging efficacy in teenage patients with increases in hemoglobin and reduced transfusions at both the 400 milligram bid and 500 milligram bid doses. Of course, we are very disappointed by these safety observations, especially considering the strong efficacy we have seen with BCX9930 and the unmet need for better treatments for patients. No one wants patients to experience these types of events in clinical trials. The key question for us now is to explore with regulators whether or not there is a path forward for the program from a benefit-risk perspective. Throughout our investigation, we have been and continue to be in active dialogue with the study sites and investigators, our independent data monitoring committee, and the FDA and other regulators. The FDA has placed the BCX9930 program on a partial clinical hold. Under this partial clinical hold, BioCryst may not enroll new patients in its BCX9930 clinical trials. However, patients already enrolled, who are receiving clinical benefit from BCX9930 treatment and have no other available treatment options can continue to be dosed and remain in the trials. BioCryst had already taken the same action voluntarily prior to the partial clinical hold, and we have of course provided study sites with updated informed consent language for patients and guidance to investigators to reflect the new safety risk. So what comes next? We know BCX9930 shows strong clinical efficacy. This clinical efficacy is seen at both 400 milligrams and 500 milligrams as illustrated on Slide 6. Based on what we are learning in the investigation, the preliminary evidence points to both 500 milligrams twice-daily dosing and the immediate side of that 500-milligram dose level without a period at a lower dose first as plausible contributory factors for the serum creatinine increases we have observed to date. Since we have also seen similar efficacy with BCX9930 at 400 milligrams and have not seen serum creatinine elevations at this dose, we plan to complete the investigation and then consult with regulators regarding a possible path forward with amended protocols using step dosing to 400 milligrams. If they agree with an approach like this, we could restart the clinical program. But if they do not, unless we identify another path to pursue, we would likely terminate the program. We expect to have clarity from regulators on whether or not there is a path forward for BCX9930 by the end of the third quarter. We do not plan on providing interim updates as we progress through these interactions. However, we look forward to completing our investigation and regulatory discussions. We plan to update you once we have clarity on our next steps for the BCX9930 program. Now I'd like to hand the call over to Anthony.

Thanks, Bill. Given the early stage of our discussions with regulators, it's premature to provide revised guidance for OpEx. In the scenario where we recommence enrollment, then spend would likely be at the low end of the $440 million to $480 million range that we guided to previously. If we discontinued the 9930 program, then spend in 2022 would be lower than that. What I can be more certain of is the strong performance of ORLADEYO and our confidence in our revenue guidance of no less than $250 million for this year and peak global sales of $1 billion. This as well as our other pipeline assets give us a tremendous base to build on. You can find our detailed first-quarter financials in today's earnings press release, and I'd like to call your attention to a few items. Revenue for the quarter was $49.9 million, of which $49.7 million came from the net sales of ORLADEYO. Having finished 2021 with revenues of $122 million, this puts trailing 12-month revenue for ORLADEYO at over $161 million as we progress towards our 2022 guidance of no less than $250 million for the year. Operating expenses, not including non-cash stock compensation for the quarter were $90.3 million. Q2 of 2022 will likely be higher given the annual guidance that we gave on OpEx previously, with 9930 investment in CMC and trial expansion being the main drivers. Cash at the end of the quarter was about $447 million, with $75 million from Athyrium that we've agreed to draw in mid-2022. Our balance sheet is very strong. We're deploying this capital towards programs that can create value for the company and for shareholders. Investments in ORLADEYO continue. We are investing to strengthen our launch here in the U.S. while we also expand our reach in bringing ORLADEYO to patients around the world. We will also continue to invest in our pipeline. The targets that we go after are challenging, and there are always obstacles. The challenges that we had with berotralstat in HAE paved the way for the success that we are now having with ORLADEYO. We are hopeful that we can continue to move forward with BCX9930. With the strong efficacy data that we have shown thus far, we believe we can help patients in PNH and beyond. But we will be smart about it. If we can move forward, we will do so with speed and focus. If we cannot, then we will reallocate capital to programs that can add value in complement and in other rare diseases. With the strength of the ORLADEYO launch, the discovery team, our development pipeline, and our strong balance sheet, we are well-positioned for future growth. Operator, we'd now like to open it up for Q&A.

Our first question comes from Ken Cacciatore with Cowen. Your line is now open.

Hey, guys. Thanks for the update. Just wondering if we could get a little bit deeper into some of the analysis on the 400 milligram. Can you talk about duration on treatment or anything that you've learned from that patient group? I know you talked about efficacy, but just wondering, as you looked into the safety, seems as if the duration on that, when they were moving through was a little bit shorter. So just want to know any more analysis you could provide on that? And then also just wondering if we could talk about the R&D, understanding the commentary on reallocating, can you just give us some perspective on the percent that's being allocated right now to 9930? Maybe a little bit more color on would it be completely allocated? Unfortunately, if we have to stop it, to what degree do you think going forward there would be adjustments lower? Thanks so much.

Bill, you want to take the first one? Anthony, the second.

Sure. I can. Thanks for the question. The way that proof-of-concept study was done, because this is such a rare disease, and to be efficient in that trial, we had a combination of intra-patient dose escalation as well as starting at higher doses in sequential cohorts of small numbers of people. The result of that certainly is that as the trial matured, the duration on 400 milligrams was substantial, but the duration on 500 milligrams was quite a bit longer. So, as I mentioned in my remarks, the observations are confined to the 500 milligram period. It's a plausible hypothesis that that is what's driving this, but we can't rule out other factors, obviously. But that's where we stand on the data.

Yes. And then in terms of capital allocation, what we've said is that last year, for example, the Factor D program accounted for around 60% to 63% of our total R&D spend, and that this year was going to be even higher. Hopefully, we can move forward, albeit with delay. If we can, yes, we'll make sure that in the areas we reallocate to have those potentials to create additional value, and I think we've been clear. It'll be potentially in both the complement space and in other rare diseases where we think we have a strong pipeline and a really good discovery team.

Great. Thank you.

Thank you. Our next question comes from Jon Wolleben with JMP Securities. Your line is now open.

Hey, thanks for the update and taking the questions. Along the same lines at 9930, I just want to make sure I heard this right. Were there nine patients enrolled so far across the REDEEM trials? And then were the three patients with elevations, were they all treatment naive or C5 inadequate responders? And any other common characteristics between the patients with the elevations?

Thanks, John, for the question. As I mentioned in the remarks, we only unblinded the patients who had the elevations. So, it's an estimate that approximately 30% of the enrolled patients had those elevations in the REDEEM studies. And those three patients do come from both REDEEM-1 and REDEEM-2.

And maybe one for Charlie, if I may. You mentioned the number of patients switching from TAKHZYRO. Do you have any data on how long those patients were on TAKHZYRO before switching?

Hey, Jon. No, we don't have that. But what we do have is data showing they were stable on TAKHZYRO. Most of these patients when they switched to ORLADEYO maintained that same level of control once they switched over to ORLADEYO. So that's what's really important.

Got it. Okay. Thanks for taking the questions.

Thank you. Our next question comes from Chris Raymond with Piper Sandler. Your line is now open.

Thank you for taking my question. I have a couple of inquiries regarding 9930. I would like to clarify whether you have observed any elevation in creatinine levels in patients treated with the 400 milligram bid dose. Additionally, I want to understand the level of evidence you have regarding the likelihood of not encountering similar issues with longer-term treatment at that dosage.

Yes. So …

Oh, I'm sorry. Also in the extension patients, you mentioned 40% had those level increases. When did that start to show up? What was the trigger? I guess you're actually seeing that effect.

So, Bill, it might be helpful to describe the proof-of-concept study about how he escalated, got to 400, and then increased to 500. I think that could clarify the first part of this question.

Sure. So the study was designed so that patients started at a lower dose. At the beginning, that was 50 milligrams. A few patients stepped through increased doses at 100, 200, and 400 milligrams. At that period, we did the PK PD modeling and had experience at 500 milligrams and higher doses in healthy subjects. We put that together and decided to move forward with the 500-milligram dose level in the pivotal, and so all of those patients then moved to 500 milligrams. The period of time that people were on 400 milligrams varies. In some, it was quite substantial. All observations increased serum creatinine as I mentioned earlier were only seen in the 500 milligram dose period. So does that clarify the question for you?

Yes, yes. Thank you.

And then his second question was around the extension and the 40% and slower rise? So it's after many months at 500 milligrams on average. The other part of your question was, what level are we talking about? We're discussing any level above the normal.

And when did you start? When did you first see that effect in the extension patients?

After quite a long period on drug that can occur within several months on average at 500 milligrams.

Thank you.

There are two patterns here as I mentioned in my remarks. There's this early onset pattern that we saw in the REDEEM studies in those three subjects. And there's this later, more mild to moderate pattern that we saw in the long-term extension, both of those observations that are confined to the 500 milligram dose level.

Thank you.

Thank you. Our next question comes from Jessica Fye with JPMorgan. Your line is now open.

Hi, good morning, guys. This is Daniel for Jessica. Thanks for taking our question. First, was the duration of dosing similar between the two patients who discontinued treatment and the one patient who continues on BCX9930 in REDEEM? Did that patient get any worse with continued dosing? And the second question is, can you maybe give us more – I will follow up after the first question.

Okay. So hi, Daniel. All three subjects who had the early onset rises in creatinine are doing better, and creatinine is falling now. The one patient who had continued dosing with 9930 has had their creatinine come way back down. The duration of treatment in all is similar prior to the onset of these events, as this was early in treatment.

Okay, got it. And I guess one more question on ORLADEYO. Can you give us maybe more color on the persistency difference seen between those who are reimbursed versus free? What could be driving that difference?

It's a good question. It's something we're digging into. One of the things is that the reimbursed patients are most likely good HAE patients who meet clinical criteria for reimbursement. That's analogous to the stable TAKHZYRO and Haegarda patients I described. The other thing is that reimbursement is always a stressor, a worry that patients and physicians have. As much as we try to help them and make them comfortable through that process, if the payer is not paying, it can lead to stress. Stress can cause attacks, stress can cause people to seek other options. So, we're really pleased about how well we're getting patients onto reimbursement and what that's leading to is, launched to date, about two-thirds of the patients who started on ORLADEYO are still on ORLADEYO, and we're building this really stable base of patients who are doing great. That's what's going to drive us to 2,000 patients.

Okay.

I think the other piece, Daniel, is that these are patients early in the process, and that's where we're seeing the bulk of the discontinuation like Charlie described. If you stay on longer, the chances are you're going to stay on the drug. That's another factor that plays into this.

Does that mean the patients on free drug don't stay that long? Sorry, got it. If I could have one more question on 9930. If the FDA doesn't allow for the resumption of the trials with amended protocol, what are the potential paths forward for the program? Is there a backup molecule that you can possibly develop? And if so, what stage is it currently at? Thank you very much.

We're still in the investigation stage, so I can't comment on any other path at this point in time. But you can imagine that we're continuing to look and see if there are other paths to pursue. We're always working on backups. You saw that with berotralstat and ORLADEYO with HAE, and in Factor D in the complement area, we're doing the same thing. They're earlier, and when we're ready to talk about them, we will, but we're always working on backups.

Great. Thank you.

Thank you. Our next question comes from Tazeen Ahmad with Bank of America. Your line is now open.

Good morning. This is Tazeen, and I have a quick question regarding 9930. If you transition to a 400 mg dose, what do you believe the implications will be for its efficacy profile? Since there hasn't been any observed increase in serum creatinine below 500 mg, why not proceed directly to 400 mg instead of taking a stepped approach? Additionally, when do you intend to escalate to the 400 mg dose in the stepped approach?

So the first question Bill is why did we move beyond 400 milligrams in the proof-of-concept? Then why did we choose that as the dose for the pivotal?

On the first point, at the time, we designed the pivotal studies. We wanted to try to give patients an opportunity to avoid breakthrough hemolysis in the event of sequential missed doses. So, that was a theoretical concern. At that time, we couldn't distinguish the safety or efficacy profile of 400 and 500 milligrams. So we thought that was a reasonable choice. With regard to the other aspect of this on efficacy, I'm very comfortable stepping back to 400 milligrams. There's strong evidence that from the proof-of-concept study that's a fine dose in increasing hemoglobin and clone size and controlling hemolysis. That was the decision at that point. Now we have new information. It makes sense to propose an alternative dosing strategy consisting of step-up dosing and limiting the dose. The reason for the step-up dosing is that none of the patients in the proof-of-concept study had early onset rises in creatinine. All of the patients in the proof-of-concept study started at a lower dose and then had to step up in dose. Other drugs on the market show that starting at a lower dose avoids early side effects. It's a reasonable plausible hypothesis as a way to move forward. We'll discuss that with regulators after completing our investigation to see whether there's a path forward or not.

Got it. Thank you so much.

Thank you. Our next question comes from Serge Belanger with Needham. Your line is now open.

Hi, good morning. Thanks for taking my questions. First one on 9930. Can you describe your FDA interaction since the study was paused? When did the FDA issue their partial clinical hold? I believe you mentioned you're planning to have discussions at the end of the third quarter. It seems like a long time to wait. So is that an FDA scheduling limitation or does additional work need to be done before this meeting?

We were informed a few weeks ago, and we had already communicated that we put a pause on enrollment and that we continued dosing in patients benefiting from the drug with no alternatives. This is consistent with the partial hold that the FDA had placed. We knew that we had an upcoming earnings call and we were in the thick of the investigation, and we thought it was better to share all the information at once so that you could have the context. That decision was made.

Jon, I think he asked the question about the timing between now and when we go back to the FDA.

Yes, that's a hard one to predict. By the end of the third quarter, we'd be able to get there. But obviously, you can imagine, we want to work as quickly as we can to get a proposal in front of them. There might be a second go that may include a meeting, so we'll see how that unfolds. But we think that it could happen by the end of the third quarter.

Okay. And then just one for Charlie on ORLADEYO. I think you mentioned there were some challenges in the first quarter. Just curious if there were results of the usual reset of deductibles, or if there was something else impacting those results, and if they've been resolved.

No, it was the expected stuff, Serge. There's always a bolus that happens in the first quarter as payers do their annual reset. It was what we expected. I think Jon mentioned in his comments that it was patients stepping back to free product during the PA process. It's the Medicare donut hole, and commercial deductibles are always higher until those are exhausted early in the first quarter.

Thank you.

Thank you. Our next question comes from Gena Wang with Barclays. Your line is now open.

Thank you for taking my questions. I have two questions. One is regarding HAE 9930. Just wondering if, let's say the FDA allows you to resume under the lower dose and stepping up protocol. Do you need to revisit your clinical trial design and expand the number of patients in order to achieve a presumed clinical benefit to reach statistical significance? My second question is regarding ORLADEYO. For the patients who are naive or switch from on-demand, could you give a breakdown of patients prescribed by community doctors versus academic doctors? What is the attack rate when they switch to ORLADEYO?

Yes, so the first question about modifying the protocol. If you're changing the dose, that's definitely a major amendment. We'd make that, but I can't tell you exactly what other things would change because we haven't had those conversations. We think that the efficacy of 400 is similar to 500, and so powering and things like that. At least, at this point, we don't think we need to change, but we'll have more information once we talk to the regulators.

Gena, on your question on acute-only patients switching to ORLADEYO, consistently since launch, it's been a little less than half the patients coming to ORLADEYO. From an overall attack rate perspective, those patients are doing well when they switch to ORLADEYO and are staying on therapy similarly to what I described with patients switching from prophylaxis. As for who's prescribing those, the acute-only portion of the market has been shrinking. That trend is consistent across the board. There'll be some doctors here and there that might prescribe more, but I wouldn't describe it as an academic versus community split. Overall, most patients these days are on prophylaxis. That prophylaxis market continues to shrink as patients switch to ORLADEYO and other prophylaxis products.

A few markets shrink.

Sorry, the market is shrinking. Thank you.

So just wondering the acute in the attack rate when they switch. If you are giving a rough estimate regarding annualized attack rate, usually what is the range of those patients?

I don't want to reference the 96-week data where they have what an average of three attacks or so per month, and they got down to half an attack per month. That's probably the best information we can give you.

That's right. What we're seeing is that most of these patients are gaining very good control after switching to ORLADEYO, which is the key point.

Yes, and I think the other point that Charlie made, the median attack rate in what 16 out of the last 17 months was zero. A lot of people are really controlled.

Okay. Thank you.

You're welcome.

Thank you. Our next question comes from Brian Abrahams with RBC. Your line is now open.

Hey, good morning. Thanks for taking my questions and appreciate all the detail both on ORLADEYO and 9930. So on 9930, if the FDA greenlights titration the protocol to 400 mg, would you still be fully investing in this drug in the same way as you did before, including incorporating patients with renal diseases in that study? Or would there be some gated investment or perhaps a focus on certain disease areas or subpopulations or more refractory patients? And then for Charlie, I'm just curious during the first quarter, was there any impact from the Omicron wave on either switching or new patient starts or discontinuation dynamics and anything we might expect to see with respect to that evolving over the course of the rest of the year? Thanks.

Yes. So I'll take the first one, Brian. We're not intended to just invest in PNH and that's the only population we go after. If the drug proves to be safe and effective at a 400 milligram dose twice a day, we'll be going into every indication that we can get into. I can't give you the timing on that because there are discussions with regulators and other things that we need to do, but it would be broad if we determine that it's a safe and effective dose.

And then, Brian, your question on Q1 with Omicron. Honestly hard to say. What I can say is our new patient starts were good for the quarter; they were slightly slower earlier in the quarter. But we ended the quarter, obviously at the same rate that we saw in the second half of last year. So really good momentum. Was Omicron a part of that? We've been operating with COVID for some time, so I'm not going to pin anything specifically on Omicron. We're happy with our pace right now.

Understood. Thanks so much.

Thank you. Our next question comes from Liisa Bayko with Evercore. Your line is now open.

Hi. Thanks for taking my question and also thanks for all the color. Just to start with 9930. Just a follow-up on what Brian was saying. Do you have any particular concerns about the idea of moving into renal diseases, just given the serum creatinine? Would we expect some sort of different outcome that group, maybe lower dosing perhaps?

Hi, Liisa. Thanks for the question. I think this PNH is a complicated disease. Every patient with PNH has subclinical kidney effects from the PNH due to hemoglobinuria. When they aren't treated, they get hemosiderin effects on the renal tubules, whether or not you can see that in any of your clinical chemistry or your analysis tests. So, they don't have pristine kidneys to begin with. They don't. I think that, I don't know the answer to your question. That's going to be an outcome of discussions with regulators and experts and ultimately patients and families. In our interactions with nephrology expert advisors through the investigation, when I asked the same question, the responses suggested a need for complement inhibitors to treat the people with no treatments who have complement-mediated diseases. We need to complete the investigation and see if we can move forward. That's not the end of the story, but it gives you an idea of what's in the minds of the experts who treat these diseases.

I think the theme of the feedback we’ve received is really important for everyone to understand. There's strong support in the community to continue moving 9930 forward. We will do it safely and thoughtfully, but I'm pleased to see the enthusiasm that investigators, key opinion leaders, and others have shown around this molecule.

Okay. That's helpful feedback. Can you describe the step-up to 400 protocol that you're considering? What doses would you start and how long would it take to get to the 400?

In the proof-of-concept study, it took a very long time. I think we need to step through the regulatory discussions first before we are certain about the protocol. There’s flexibility in what's the approach there. Let's see how that goes.

Okay. Lastly, regarding ORLADEYO, your guidance of $1 billion, do you factor in any potential competition from other oral kallikrein inhibitors in various stages of development? Do you have an ongoing effort there? It seems like you've created a nice market here and I'm wondering if you have lifecycle management plans.

Yes, we definitely consider future competition and the timing of which is some years out from now. Here's how we get to that number mathematically, right? It's 2,000 patients out of the 7,500. Charlie told you that. That's between 25% and 30% market share, so we have plenty of market left. If you're controlled on one capsule once a day, why would you switch? What incremental benefit would lead you to do that? We've conducted a lot of market research, and we find it difficult for others to take market share away from us now. They may take share from other injectables, but for patients that are well-controlled and tolerate the drug, we think it's a realistic number.

What about your lifecycle management plans?

We're always looking for ways to advance. We've invested significantly in HAE. Developing a pipeline beyond HAE with complement and the like. We also have a long patent life with ORLADEYO as well. Our focus is to get to peak as fast as we can, lock in those patients, and advance our pipeline.

Is it really difficult to develop oral kallikrein inhibitors? Is that what I'm hearing? Without seeing 100% relief of attacks in a clinical trial, could other molecules realize patients staying on the drug or in a clinical trial, and what are you working on? Is it just so difficult? We haven't seen much progress.

Just one thing to correct: while pivotal study results are pivotal, the real-world data shows that people are really well-controlled. This isn't a matter of sacrificing efficacy for convenience. It's very challenging. As evidenced by the fact that we are the only one who's created a once-a-day formulation. We know there are high attrition rates in this industry, especially for difficult targets.

Last question: you received the designation for your FOP program. Are you making investments there? What are your next steps?

Yes, we are. We're excited to receive that designation and aim to start in patients next year. We're continuing to advance that program as it shows promise in a disease with no effective treatments.

Thanks, Jon.

Thank you.

Thank you. Your final question comes from Justin Kim with Oppenheimer. Your line is now open.

Hi. Good morning. Just a quick one from me. I didn't see much mention around experience in the renewed population. Is there substantial enrollment there that clinical experience can be accrued? I'm curious about how you'll get the evidence for confidence in treating this population.

Yes, we're just starting enrollment in that trial. So, it wasn't a substantial number of patients. It was very few, and I think Bill talked about how we evaluate nephritis diseases, complement-mediated diseases. We have more work to do, but if we have a safe and effective drug, we'll explore many indications— that is the aim.

Got it. Thanks.

Thank you. This concludes today's Q&A session. I would like to turn the call back over to Jon Stonehouse for closing remarks.

Yes. Thank you. If you take a step back and look at our company, you see a highly innovative, once-a-day oral kallikrein inhibitor called ORLADEYO, which is on its way to no less than $250 million this year and a $1 billion at peak. What's the value of that? We have a pipeline; yes, we've faced some challenges. What biotech companies do you see that don't face challenges? But we are still excited about bringing more products to market for patients suffering from rare diseases. What's the value of that? Then we have a discovery engine that can repeat this effort; what's the value? Lastly, we have a strong balance sheet, really strong, and we're earning revenue at the same time. What’s the value here? There’s a lot of value today and the potential for even greater value in the future. We'll address challenges as they arise and drive ORLADEYO sales toward $1 billion. We're confident we have what it takes to build one of the next great biotech companies. Thank you for your interest, and have a great day.

This concludes today's conference call. Thank you for participating. You may now disconnect.