Thank you, Operator. Good morning and welcome to Esperion's Second Quarter 2023 Earnings Conference Call. With us today are Sheldon Koenig, President and CEO and Ben Halladay, CFO. Other members of the executive team will be available for Q&A following our prepared remarks. I want to remind callers that the information discussed on the call today is covered under the Safe Harbor provisions of the Private Securities Litigation Reform Act. I caution listeners that management will be making forward-looking statements. Actual results could differ materially from those stated or implied by our forward-looking statements due to risks and uncertainties associated with the business. These forward-looking statements are qualified in their entirety by the cautionary statements contained in today's press release and in our SEC filings. The content of this conference call contains time-sensitive information that is accurate only as of the date of this live broadcast, August 1, 2023. We undertake no obligation to revise or update any forward-looking statements to reflect events or circumstances after the date of this conference call and webcast. As a reminder, this conference call and webcast are being recorded and archived. We issued a press release earlier this morning detailing the content of today's call. A copy can be found on the Investor page of our website. We will begin the call with prepared remarks and then open the line for your questions. I'll now turn the call over to Sheldon Koenig, President and Chief Executive Officer.

Thank you, Alexis, and good morning, everyone. Thank you for joining us today to discuss our second quarter results and the recent progress we've made. Our business is continuing to grow each quarter. We are pleased to report total revenue for the second quarter of $25.8 million, which is a 37% increase year-over-year. We reported $20.3 million in U.S. revenue, reflecting 49% year-over-year growth. We attribute the strength of our U.S. business to increased awareness of our brands and our clinical data, as well as solid execution of our commercial strategy as we prepare for full launch. Let me next walk you through some additional key highlights from the quarter. As I just mentioned, we saw continued RPE growth in the second quarter of 26% year-over-year. We are pleased with this trend, which we've been able to accomplish with a current label and promotional footprint. As promised, we submitted our regulatory filings during the second quarter in both the U.S. and EU to meaningfully expand our labels in both jurisdictions. Our clinical and regulatory teams worked tirelessly to compile the vast amount of data required for these submissions, which come out over the Outcomes trial of this scale, and we're proud of their execution. We anticipate a standard 10-month review for both submissions and therefore expect regulatory approvals of expanded labels in both the U.S. and EU in the first half of 2024. We are continuing to pave the way for the significant growth we believe will result following label change. Our targeted commercial approach involves strategically presenting relevant analysis to the right audiences at a regular cadence, which enables us to effectively educate the market and target different segments of the population. In June, we presented impressive new primary prevention data at the American Diabetes Association Congress, which showed significant and clinically meaningful reductions in cardiovascular risk and LDL cholesterol. This means that our therapies are not only effective in patients who have already had a cardiovascular event but also in those who are at high risk of one, thus meaningfully expanding our addressable market. This primary prevention analysis was also simultaneously published in the prestigious Journal of the American Medical Association, reinforcing its clinical significance. We also presented new intention-to-treat and on-treatment analysis at the Endocrine Society Congress, demonstrating improved outcomes and consistency of benefit, which is comparable to statins and better than PCSK9 inhibitors. We will continue to present results throughout the year at the highest level congresses and meetings we believe are the right fit, including two late-breaker presentations at the European Society of Cardiology in August. We are pleased to share that our partnership with Currax launched in early Q3, as did another 20 in-house sales force members who joined Esperion in new territories. We look forward to seeing increased traction over time as these new additions ramp up their territories in subsequent quarters. Lastly, we continue to have positive conversations with payers and to date, we've now presented Outcomes status to pharmacy benefit managers and national payers who represent over 80% of total U.S. pharmacy lives. Feedback has been extremely positive across the board, and payers are already adapting utilization management criteria to reflect our CVOT data. Based on our CLEAR Outcomes data, we believe we have the potential to benefit a much larger group of patients than is characterized by our current label. Our current label is indicated for a small subset of patients with diagnosed atherosclerotic cardiovascular disease, ASCVD and heterozygous familial hypercholesterolemia who cannot meet their goal on a maximally tolerated statin. Our new and expanded label will add a broad cardiovascular risk reduction indication in both primary and secondary populations, as well as remove current limitations including the requirement of a maximally tolerated statin therapy. From a commercialization perspective, label expansion means we will be able to meaningfully increase our addressable patient population. Our CLEAR Outcomes data increases the total addressable population to approximately 70 million patients in the U.S. alone. Currently, our label covers approximately 10 million patients with documented ASCVD who are on a maximally tolerated statin and who are still not at their LDL cholesterol goal. Our new label will enable us to treat not only that population but also an additional 15 million high-risk primary prevention patients who are taking the statin, plus 5 million patients with ASCVD or who are at high risk for ASCVD and who are statin intolerant. In total, our post-label change focus will be on these 30 million patients, with additional potential upside from the untreated high-risk patient population, which represents another 40 million patients. We are confident that NEXLETOL and NEXLIZET have blockbuster commercial potential and we look forward to being able to reach even more patients who are unable to achieve their LDL cholesterol goals on current therapies alone. With that, I will now hand it over to Ben Halladay, our Chief Financial Officer, for a more detailed overview of our second-quarter performance.

Thank you, Sheldon. Earlier this morning, we issued a press release containing our financial results for the second quarter, which is available on the Investor page of our website. Please note that unless otherwise specified, my comments reflect results for the second quarter ended June 30, 2023. Overall, we posted strong second-quarter results. We demonstrated persistent growth in retail prescription equivalents during the quarter, which increased 26% year-over-year and 16% quarter-over-quarter. The weekly RPE trend is also impressive and we're proud to have recently surpassed the 10,000 RPE mark, reflecting continuing positive reception of our CVOT data. Our European partner continues to report strong growth of our therapies in its territories, showcasing the value these important medicines bring to clinicians and the patients they care for. At the end of May, 123,000 patients have now been treated with our therapies in Europe, representing sequential three-month growth of 26% since February. We also had a new territory addition at the end of the second quarter with our products launching in Italy. Turning to our financial results for the quarter. As of June 30, 2023, cash, cash equivalents and investment securities available for sale totaled $138.5 million, compared to $166.9 million on December 31, 2022. We reported U.S. product revenue of $20.3 million, representing an increase of 49% year-over-year. Collaboration revenue, which includes combined royalty and partner revenue, was $5.5 million, an increase of 4% year-over-year. Finally, total revenue for the second quarter was $25.8 million, an increase of 37% year-over-year. Turning to expenses, the cost of goods sold for the second quarter was $6.8 million, which is 26% lower than last year, driven primarily by decreased product sales to our collaboration partners due to the timing of tablet shipments. We've already seen an acceleration of shipments through July, which will be additive to our original expectation for the third quarter. We anticipate an increase in tablet sales over the next 12 months and therefore expect cost of goods sold to mirror this elevated demand. R&D expense was $22.1 million, a decrease of 32% year-over-year, reflecting lower costs following the readout of our CLEAR Outcomes study. SG&A expense was $34 million, an increase of 15% year-over-year, reflecting upfront training costs for our contract sales force as well as higher legal costs. We still expect full year 2023 operating expenses to be between $225 million and $245 million, and we are tracking in line with that guidance. This total breaks out to $100 million to $110 million in R&D expense and $125 million to $135 million in SG&A expense. As a reminder, our operating expenses are expected to be first half loaded and to moderate in the back half of the year. I wanted to further elaborate on expenses and our approach to prudent cash management now and over the next year. First, we have guided to having sufficient cash runway through mid-2024, which will take us beyond when we currently expect to receive approval of our new and expanded label and corresponding milestone payment. Second, while we are not changing our expense guidance for 2023, we did outperform our internal spending expectations in the second quarter, and we will continue to look for opportunities to generate additional efficiencies in the back half of 2023 without impacting the quality of the full commercial launch we are planning next year. These levers include internal cost control as well as slower pipeline investment, which will occur against the backdrop of continued sales growth. Our plan is for continued execution of these initiatives for the remainder of the year as we approach full-scale commercialization in mid-2024. With our sights set on the massive potential of our NEXLETOL and NEXLIZET franchise, we are steadily and prudently working to reach our goal.

Thank you, Ben. I'll now provide additional corporate updates from the quarter. First, we recently received a letter from the FDA regarding the finality of the determined regulatory review periods for our requested patent term extension, which would extend our composition of matter patent by another five years through mid-2031. As no oppositions were filed, we anticipate receiving this certificate of extension in the next several months. Second, the court has set an April 2024 trial date to hear the amended complaint our legal team at Gibson Dunn filed against our European partner as we requested. We are pleased that our case is being treated with a sense of urgency and remain confident that this matter will be resolved in our favor and that we will receive the $300 million milestone payment we believe we are contractually entitled to. Lastly, I want to emphasize our focus on heads down execution of our strategic plan. We once again delivered on our promises for continued growth and prudent expense management in the second quarter. We still expect the true sales inflection to come following label expansion and are diligently working toward that goal and preparing for full commercial launch. Next, I would like to reiterate our plan to achieve blockbuster status for our franchise. First robust data. Our landmark 14,000 patient Outcomes trial generated a remarkable amount of high-quality data, which enables us to produce powerful subgroup analysis that are extremely relevant to healthcare providers. Next, our data will be used to support a highly differentiated label. Following this label expansion, we expect to see updates to physician treatment guidelines across the globe and a meaningful shift in adjunctive therapy utilization. Finally, we are continuing to execute on our strategic plan, prudently investing in growth initiatives and working to educate healthcare providers and payers alike ahead of our label expansion next year. I would like to wrap up our comments today with a reminder of the commitments this leadership team has made and continues to deliver on. First, we promised to deliver consistent growth following our company reorganization in the fall of 2021. We did just that. Second, we promised to show accelerating growth following our CVOT readout in the spring of 2023. We are doing that, and third, we promised to demonstrate exponential growth following label expansion and full commercial launch in mid-2024, and we will do just that. Plenty of work remains to be done, but I am proud of the progress we have made thus far. I want to thank the entire Esperion team for its tireless work and commitment to this vision. I have unwavering confidence in our ability to succeed and look forward to demonstrating continued progress towards our goals. And with that operator, we are now ready for Q&A.

Thank you. Our first question will come from Dennis Ding from Jefferies. Your line is open.

Hi, good morning. Thanks for taking our questions. Two from me, maybe talk about the April 2024 trial date and how set in stone is that date and could that be delayed in any way by the judge or Daiichi? And then number two, around your OpEx guidance, you've reiterated your guidance this year, but I'm curious how much more could this be managed, particularly on the R&D line? It seems like your guidance is implying R&D spend to be at around $25 million a quarter in the second half. What is this really being spent on appreciating you have two preclinical assets and how much more could this be managed? Thank you.

Hey, good morning, Dennis, and thank you. I'll take the first part of your question and then I'll turn it over to Ben for the second part of the question. So regarding the court date, first, let me emphasize again, as we said in our prepared remarks, we are very happy about the fact that the court solved our way. As you know, I think we had spoken to you about this, Daiichi Sankyo was pushing in for a trial date of October of 2024 or later, and we had always targeted the April 2024 timeline because that is when the milestone would have been due anyhow. So with that said, right now both of the parties are focused on really just pushing forward with an eye on the March 1st close of discovery, and that's really what's going to be happening over the next several months. All the parties will be focused on fact discovery, exchanging documents, etc. And if there are updates that are material to the case, we'll certainly update you. But again, as I mentioned in the initial part of my answer, we're very excited about the fact that the court awarded us the April 2024 trial date. Ben?

Hey, Dennis, thanks for the question. So in regards to R&D expense, we still have a fair amount of levers we can pull there and room to toggle things up or down as needed. For the second half of the year, we have some expense that is still sort of lingering from the Outcomes trial closeout that should wrap up in the next month or two here. But then for the rest of the year, it's mostly related to the preclinical assets and some of our production validation expense. So there's a fair amount of variability that we can move up or down with both of those things.

Got it. Thank you.

One moment for our next question. Our next question comes from the line of Serge Belanger from Needham. Your line is open.

Hi, good morning.

Hi, Serge.

First question, I guess a follow up on the legal proceedings with your partner. Do you expect a resolution around this April, 2024 court date or could it potentially drag out a little longer from there? And then secondly, given the higher volumes of prescriptions and sales that we've seen since the ACC meeting, can you just talk about the overall impact on gross to nets if they have improved, and where do you expect them to be over time? Thanks.

Yes, hi, Serge. I will address the legal question and then pass it to Ben regarding gross to net. Concerning your inquiry about a potential appeal despite the April court date, our legal team has informed us that appellate courts generally show deference to trial court decisions. In the case of the DSC appeal, we would have the option to pursue post-judgment interest on the amount owed, particularly if regulatory approval is granted before any resolution. However, the key point is that this trial is scheduled to happen soon. I am very confident that the courts will rule in our favor. We believe we have a strong case and the desired timing. That's the best answer I can provide at this moment. We will keep everyone updated on our progress with the litigation. Ben, would you like to share your thoughts on gross to net?

Yes, thank you, Serge. So for gross to net we've been in a good place for a while now. We've had kind of this laser focus on managing gross to net and controlling what's within our control for that. And I would say we're in a pretty good shape and we're in steady state at this point and will be for a little while. Increased volumes will help, but it's more to the one or two year horizon that they will help, not necessarily in the immediate quarter term. So I would say as volumes increase post label expansion and the following years, we'll see more incremental improvements, but we've been in the same state for a while now.

Thank you.

One moment for our next question. Our next question comes from line of Joseph Thome from Cowen. Your line is open.

Hi there. Good morning and thank you for taking my questions. Maybe the first one since the ACC presentation maybe, how have you seen, where have you seen these prescriptions? Is increase in prescription coming from, is this increased depth at current prescribers? Are you getting new physicians prescribing the therapy? And then I know you mentioned next year, leading up to the full-scale launch hopefully after these label expansions are granted, can you talk about how much you would potentially increase your footprint and maybe how much of that relies on the Daiichi milestone? And then last really quick question. Obviously, you talked about the appeal, but as we think about that April court date, when should we expect sort of the initial decision on the trial outcome? Is that in the order of three months or longer? Kind of, how should we think about that first read from that trial if it happens in April? Thank you.

Thanks, Joe. Eric, do you want to take the first two and I'll take the legal question?

Absolutely. Thanks for the question, Joe. So with regards to prescribing, we're seeing both depth and breadth increases, and we're seeing it across cardiology and primary care. Right now we're at about an equal split between primary care and cardiology. So really pleased with the changes that we've seen post ACC. And remember, we still have a relatively small commercial footprint, and we're on current label. With regards to footprint changes over time, we recently, as Sheldon mentioned in the opening comments, added about 20 individuals to the sales team that went into effect July 5th. So that's for the back half of this year. And we've got plans to make further additions to the sales force prior to the anticipated label. We also did put the Currax team into place as part of that co-promotion that we've talked about. That's 72 individuals that have P2 responsibility for our products.

Great, thanks Eric. Joe, regarding your question of how long would it take to make a decision? The simple answer is we actually believe that that decision can happen very quickly. It could be a matter of days, possibly a week. But again, this is really a case that's focusing on contract language in Section 9.2 of the contract and we've made that public in the second complaint that we had filed, so it would occur pretty rapidly.

Great, thank you very much.

Thank you.

One moment for our next question. And our next question will come to line of Thomas Shrader from BTIG. Your line is open.

Good morning. Thanks for taking the question. You mentioned primary prevention scripts. Is that a meaningful percentage yet and is any of that reimbursed or are those self-paid patients and where are you in patient support? We have copay card issues for a long time. Is patient support stable now? And can you give us a sense of what the average copay is? Thank you.

Eric, if you want to start that and B.J.

Yes, sure. So first question, Tom, with regards to primary prevention, it is not within our current label, with the exception of the HeFH patient, and our focus has been on the ASCVD patient that's on a maximally tolerated statin that's not at their goal. With that said, there is a lot of pent-up demand for primary prevention. As you know, our CLEAR Outcomes data incorporated primary prevention patients, which is going to put us in a really strong position for when we have the label change. But right now, our focus has not been on primary prevention based upon our current label and on payer contracts.

Okay. Thank you.

One moment for our next question. Our next question will come from the line of Jason Zemansky from Bank of America. Your line is open.

Good morning. Congratulations on the quarter, and thank you so much for taking our questions. I know we keep harping on this, but a couple more on the legal dispute. Appreciating there's a limit to what you can disclose here, but is there any dialogue between the two parties outside of the specifics of the case itself? To what extent do you think, well, to what extent would you be amenable to resolving the issues prior to the trial date? And while you really haven't disclosed many of the specifics regarding Daiichi’s comments here, any sense of their flexibility on the willingness to forego the trial itself? Thanks.

Great, hi Jason. Thank you for your question. So as it relates to having any type of discussions or settlement discussions with DSC, right now we can't comment on our legal strategy in the ongoing suit. Our goal again is to secure the full $300 million that we are contractually owed, and that's what we're focusing on. Following the EMEA approval, which is expected in the first half of 2024, as we mentioned in the prepared remarks and in some of my answers earlier today, that will put us right in the timing of the April court date as well. So I think that's the best we can tell you at this point. And just as it relates to settlement or what would we approve or what would we take, etc., obviously if we had something like that, it's my fiduciary responsibility to take something like that to the Board at that time; that doesn't exist. Right now, as I mentioned, we're focusing on discovery and focusing on that court date in April.

Maybe as a follow-up then, any contingency plans here in terms of potentially finding an alternative EU partner or something along those lines?

Yes, really, there's nothing that we're doing as it relates to that. As we mentioned today, Daiichi Sankyo, our partner is doing a great job in selling the product. They've been showing continuous growth since they've been marketing this product for over two years. And I think that's something that's important on both sides, both the Esperion side, as we mentioned, we're focusing on heads-down execution, they are as well and this is why we're seeing significant growth. As we have always been saying that after statin, NEXLETOL and NEXLIZET are next, and we're seeing that both in the U.S. and also outside of the U.S. and Europe.

Got it. Thank you for the color.

Thank you. One moment for our next question. Our next question comes from Joseph Pantginis from H.C. Wainwright. Your line is open.

Hi, everybody. Good morning. Thanks for taking the questions. So two, if you don't mind. So first for Ben, just curious with your cost management commentary during your prepared comments, any more specifics with regard to, you said pipeline impacts? And then maybe for Eric and Sheldon, maybe getting a little more into the weeds on the detailing process, as you've been sharing the data, and you've obviously seen some impact with regard to prescriptions on the CLEAR Outcomes data, what is the relative percentage or any details you can provide from physicians that essentially say, love the data, but I'm going to wait for the full approval before changing my prescribing habits? Thanks a lot.

Yes, thank you. Good morning and thanks for the question. So as far as it goes for pipeline spending, we've done a great job here, sort of meaningfully progressing those assets while managing the spend. We've gotten very smart about where we put our money and sort of leveraging big data and AI technologies to maximize where we're putting that. I think it's something that we can spend as much or as little on as we want, but still leverage a lot of the work that we've had and move those forward. Even if we do spend as much as we want, it's still, I would say a reasonable amount, but it is something that we can toggle. I mentioned in the prepared comments, we have cash runway until the middle of next year, and I think we can potentially extend that further depending on how much we invest in both pipeline and some of the commercial stuff that we're doing.

With that said, there is a lot of desire to expand the treatment patient population. I've mentioned in the past some of the key limitations we have, but that maximally tolerated statin as well as shedding the focus just on ASCVD and pulling in that high-risk primary prevention. So I'm very pleased with what we're seeing now, but this isn't with us promoting CLEAR Outcomes data. When that happens, we'll expand the population. We'll expand the type of evidence we're able to talk about, and we will expand the commercial footprint. So that's the exponential growth phase that we talked about.

Great. I appreciate the comments. Thank you.

You're welcome.

Thank you. One moment for our next question. And our next question will come from the line of Jason Butler from JMP Securities. Your line is open.

Hi, thanks for taking the question. Just wondering if you could give us any more color about the reimbursement dynamics since ACC. Have you seen any changes in approval rate or time from treatment decision to getting reimbursed for the drug, or any other color that supports the process is getting easier for physicians and patients? And then just one on I guess, treatment ordering. Is there any changes that you're seeing and when the drug is being used now versus before ACC? Thanks.

BJ, do you want to answer the first part and Eric to the second?

Yes. So certainly, when you see the demand, this has been noticed by the payers and based on the presentations that we've had, with over 85% of the pharmacy lives. What we have seen is actually an increase of our prior authorization rates being approved as well as just an overall with key national payers as much as up to 16% with this. Certainly, educating the offices and what we've put a laser focus on is educating the offices just on the prior authorization requirements and really certain tactics and spending some time on that education, which has also helped with the approval rate. So we anticipate again, the closer we get, and with the label we will continue to improve, but we've actually seen a great improvement versus last quarter and over the last year.

And then, Jason, with regards to any dynamic changes since ACC, so as I mentioned, we've seen increases in both cardiology as well as primary care. I would say, from a percentage perspective, there's been increased cardiology excitement because they have been recipients of the data. Still, again, the focus is on the ASCVD patient on maximally tolerated statin not at goal. We have seen increases in NEXLETOL. Still, NEXLIZET is our leader, if you will, but we've seen increases in NEXLETOL, again based upon the press as well as the association between NEXLETOL and CLEAR Outcomes. So our label will expand for both brands, and we anticipate again exponential growth post-label change.

And Eric, just a quick follow-up. Is there any evidence that NEXLETOL is being used before ezetimibe in those scenarios, or can you provide any insight on that?

Yes. So starting to, Jason. So we have done many quantitative surveys where ezetimibe tends to go down based upon seeing the CLEAR Outcomes data, still early. But yes, ezetimibe, as you know, has a 6% Outcomes benefit in that secondary prevention population and you're very familiar with their CLEAR Outcomes data. So ezetimibe will come down, still early now, and again, we're not promoting any of the CLEAR Outcomes benefits.

Thank you. And I'm not showing any further questions in the queue. I'd like to turn the call back over to Sheldon for closing remarks.

Great, thank you so much. First of all, I just want to thank everybody for their interest and their questions and your support of Esperion. Just a couple of key points I would leave you with. And again, what we've demonstrated this quarter is the fact that we've delivered growth across all KPIs. We obviously beat expectations. We are very happy with where we see our prescriptions growing and as we said before, without even having the full label approval behind us. We're on track with our key litigation milestones, again, the case being scheduled in April of 2024. It's a significant win for us. And finally, again, we're seeing it currently after statin, we're next. That's really supported by the 14,000-patient CLEAR Outcomes study. So thank you again, and I look forward to talking to all of you soon. Have a great day.

This concludes today's conference call. Thank you for participating. You may now disconnect. Everyone, have a great day.