Good day and thank you for standing by. Welcome to Kiniksa Pharmaceuticals Fourth Quarter 2024 Earnings Conference Call. At this time all participants are in a listen-only mode. After the speakers' presentation, there will be a question-and-answer session. Please be advised that today's conference is being recorded. I would now like to hand the conference over to your speaker today, Jonathan Kirshenbaum, Investor Relations. Please go ahead.

Thank you, operator. Good morning, everyone and thank you for joining Kiniksa's call to discuss our fourth quarter and full year 2024 financial results and recent portfolio execution. A press release highlighting these results can be found on our website under the Investors section. For the agenda today, our Chief Executive Officer, Sanj K. Patel, will start with an introduction. Dr. John Paolini, our Chief Medical Officer, will review our recently announced KPL-387 development program. From there, Ross Moat, our Chief Commercial Officer, will provide an update on our ongoing commercial execution with ARCALYST. Then, Mark Ragosa, our Chief Financial Officer, will review our fourth quarter and full year 2024 financial results. And finally, Sanj will return for closing remarks and to kick off the Q&A session, for which Eben Tessari, our Chief Operating Officer, will also be on the line. Before getting started, please note that we will be making forward-looking statements today that are subject to risks and uncertainties that may cause actual results to differ materially from these statements. A review of such statements and risk factors can be found on this slide, as well as under the caption Risk Factors contained in our SEC filings. These statements speak only as of the date of this presentation and we undertake no obligation to update such statements, except as required by law. With that, I will turn it over to Sanj.

Thanks, Jonathan, and good morning, everyone. Thank you for joining our fourth quarter and full year 2024 earnings call. As you know, we reported our preliminary ARCALYST revenue and cash balance earlier this year. Strong execution drove continued growth in 2024, and we're incredibly excited about the opportunities ahead of us. Today, I'm going to focus on the exciting program announcement we made earlier this morning. We are advancing our newly announced KPL-387 program, which is an independently developed monoclonal antibody IL-1 receptor antagonist with the potential to enable monthly Sub-Q dosing in recurrent pericarditis. We are incredibly excited about this program and the opportunity to extend our leadership of the recurrent pericarditis market and to potentially expand the treatment options available to patients. KPL-387 is an IL-1 pathway inhibitor which we understand very well from our work and experience with ARCALYST, the first and only FDA approved therapy for recurrent pericarditis. Dr. John Paolini, our Chief Medical Officer, will share additional details about the mechanism of action and data we've generated to date, but our deep familiarity with this pathway provides us with added confidence as we advance KPL-387 through clinical development. In addition to the ongoing Phase 1 study, we've interacted with the FDA and plan to start a Phase 2/Phase 3 trial in recurrent pericarditis patients in the middle of this year, with data from the Phase 2 portion expected in the second half of 2026. We plan to move as fast as humanly possible and our goal is to have this treatment option available to patients by the '28/'29 timeframe. Moving to our Q4 and full year 2024 performance and future growth. On the commercial front, we continue to grow ARCALYST revenue and collaboration profitability with fourth quarter net product revenue of $122.5 million and full year 2024 net revenue of $417 million. Ross will review the commercial highlights in a moment, but overall, we believe there is substantial opportunity for us to continue to grow the recurrent pericarditis market with ARCALYST in the years ahead. Our full year 2025 ARCALYST net revenue guidance is between $560 million and $580 million. As you can see on our pipeline slide, we remain focused on developing novel therapies for diseases with unmet need prioritizing cardiovascular indications. In addition to KPL-387, we're advancing KPL-1161 which is an Fc-modified IL-1 receptor antagonist with a target profile of quarterly Sub-Q dosing. We are currently conducting IND enabling activities with this molecule. Based on these opportunities, we plan to discontinue development of abiprubart in Sjogren's disease. Through Phase 2 studies, abiprubart has been well tolerated, and we look forward to evaluating strategic alternatives for this asset. I want to extend our sincere gratitude to the patients, caregivers and investigators who contributed to our Sjogren's Disease study. Moving forward, in addition to prioritizing our portfolio development strategy, we have a robust balance sheet, and we are cash flow positive on an annual basis. Together, we expect these to provide additional capacity to continue investing in value creating opportunities across our business. The bottom line is that we've made tremendous progress with ARCALYST, and we think there is substantial opportunity still ahead with that first product. As the market leader, we are committed to exploring additional treatment options for patients. And with that, I'll turn it over to John to review KPL-387 and our development program in recurrent pericarditis.

Thank you, Sanj. As Sanj mentioned and as outlined in our press release this morning, Kiniksa has announced the development program for KPL-387, an independently developed fully human IgG2 monoclonal antibody antagonist of the IL-1 receptor. Extending our leadership in recurrent pericarditis and IL-1 pathway inhibition, we are developing KPL-387 as a potential additional therapeutic option for patients, with a target profile of a monthly subcutaneous single injection in a liquid formulation. The mechanism of action of KPL-387 is that it binds to the IL-1 receptor subunit called IL-1R1 and in this way, it directly inhibits the signaling activity of the cytokines IL-1α and IL-1β. This was demonstrated first in preclinical in vitro studies in which KPL-387 was shown to be a potent inhibitor of IL-1 receptor activation as well as IL-6 production induced by IL-1α or IL-1β. Subsequently, KPL-387 was shown in in vivo pharmacokinetic studies in non-human primates to have favorable pharmacokinetics that supported advancement into the Phase 1 first in human study. On this slide, you can see some of the top line data from the single dose subcutaneous administration portion of the Phase 1 first in human study. This is a randomized double-blind placebo controlled study in approximately 112 healthy subjects evaluating the safety, tolerability, pharmacokinetics, pharmacodynamics and immunogenicity of KPL-387 administered subcutaneously or intravenously as single ascending doses and as multiple ascending doses administered subcutaneously. These data show that the single dose pharmacokinetics of KPL-387 at the dose level shown in red demonstrated sustained serum concentrations above the target concentration supporting the profile for a monthly dosing paradigm. Data from the study were utilized to support the design of the upcoming Phase 2/Phase 3 trial. As Sanj mentioned, we have had interactions with the FDA regarding the next steps for the KPL-387 program and we expect to initiate a streamlined Phase 2/Phase 3 trial in recurrent pericarditis in the middle of this year that we believe may support approval. Details of that trial will be forthcoming at a future date. I will now turn it over to our Chief Commercial Officer, Ross.

Thanks John. As you heard from Sanj, we are incredibly excited about KPL-387 and the opportunity to further expand the treatment options for patients with recurrent pericarditis. We also remain very excited about the substantial growth potential still ahead with ARCALYST. Having launched ARCALYST nearly four years ago and delivered continuous revenue growth, we have built a deep understanding of the market, and we plan to continue our ARCALYST growth by serving many more patients in the years ahead. After driving our net revenue in 2024 to $417 million, our 2025 guidance is between $560 million and $580 million, and there are a number of key initiatives that we are taking to continue to build the marketplace for ARCALYST. Firstly, disease education and awareness continue to be fundamental to our strategy. Initiatives such as our Life DisRPted campaign and our sponsorship of the American Heart Association's Addressing Recurrent Pericarditis initiative are raising disease awareness, helping doctors to identify more patients, and promoting a proactive approach to earlier diagnosis and treatment. Secondly, we continue to be focused on increasing the breadth and depth of prescribing as evidenced by the increase in number of total and repeat prescribers every single quarter since launch. We believe the utilization of ARCALYST is growing as a result of the experience physicians and patients are having in terms of prescribing, gaining access and witnessing the high efficacy of the drug. We are focused on promoting to the full scope of the ARCALYST label, and we're seeing an increase in ARCALYST prescriptions being written across all recurrences, including for patients on their first recurrence, which highlights doctors are becoming increasingly confident in moving ARCALYST earlier in the disease course given its targeted mechanism and robust efficacy. Additionally, as the leader with the only FDA approved therapy for recurrent pericarditis, we remain committed to supporting the development of a more efficient network of care through supporting the establishment of regional centers of excellence. We believe this approach has the ability to streamline referral pathways, reduce the barriers to care, and in turn enhance patient outcomes. Importantly, while we've made great progress since our launch, we believe there is a significant opportunity ahead for ARCALYST, as we continue to build the market and transform the treatment paradigm. With that, I'll turn it over to our CFO, Mark.

Thanks Ross. It is certainly an exciting time at Kiniksa. We are well-positioned from a financial standpoint and through continued commercial execution and financial discipline, we expect to continue to create value across our business. This morning, I will cover our fourth quarter and full year 2024 financial performance. You can find our detailed financial information in today's press release. There are a few items of note. First, starting on the left-hand side of this slide with our income statement. As you've heard from Sanj and Ross, strong commercial execution throughout 2024 drove continued ARCALYST product revenue growth. On a year-over-year basis, ARCALYST product revenue grew 72% to $122.5 million in the fourth quarter and 79% to $417 million for the full year 2024. Second, operating expenses grew year-over-year in both the fourth quarter and full year 2024, primarily driven by cost of goods sold due to ARCALYST revenue growth and tech transfer related expenses, collaboration expenses with continued ARCALYST collaboration profit growth which I'll detail shortly, as well as R&D to support abiprubart and KPL-387 development and SG&A to support ARCALYST commercialization. Third, net loss was $8.9 million in the fourth quarter and $43.2 million for the full year 2024. Fourth, on the right-hand side of the slide, you'll see a calculation for ARCALYST collaboration profit which largely drives collaboration expenses. On a year-over-year basis, ARCALYST collaboration profit grew 125% to $76.3 million in the fourth quarter and 108% to $234.7 million for the full year 2024. Of note, fourth quarter and full year 2024 collaboration expenses included a $10 million charge for Regeneron's share of a $20 million milestone from Huadong Medicine with the approval of ARCALYST in China. The cash from this milestone was received in January and will be captured in our first quarter 2025 cash balance. Lastly, regarding our balance sheet at the bottom of the slide, we ended 2024 with an approximately $244 million cash balance, representing approximately $37 million of net cash flow for the year and we expect our current operating plan to remain cash flow positive on an annual basis. With that, I'll turn the call back to Sanj for closing remarks.

Thanks Mark. I hope you can all sense the excitement that we have about the future here at Kiniksa and we certainly plan to continue to execute across our clinical and commercial business. As shared this morning, we are eager to drive additional growth in our fourth year post launch with ARCALYST, as well as extending and maintaining our leadership in recurrent pericarditis with ARCALYST and with the development of KPL-387. There's a lot to look forward to as we continue to advance novel therapies for patients suffering from debilitating diseases and unmet need. With that, I'll turn the call back to the operator for the questions. Thanks very much.

Thank you. Our first question today will be coming from the line of Anupam Rama of JMP. Your line is open.

Hey, guys. Thanks so much for taking the question and thanks for the update here. Two quick ones for me. First, maybe what does your market research suggest about what a monthly subcutaneous formulation such as KPL-387 could mean for patients in the market overall versus the weekly regimen that you have with ARCALYST Sub-Q. And then just quickly on slide 10, slide 10 I just wanted to confirm that that dose F, the red line, that's referring to a monthly subcutaneous dose, not an IV dose. Thanks so much.

Hi Anupam, this is Ross. Hope you're well and thank you very much for the questions. Maybe I'll answer your first question and then hand over to John for the second question. So yes, a good question regarding market research and kind of patient acceptability and desire and preference, we believe that the compliance rate and the acceptance rate of ARCALYST is really very good, and we see that through the adherence and duration to the therapy. Having said that, moving potentially from a weekly to a potentially monthly therapy could be advantageous for many patients in terms of preference. Additionally, along with the drug itself, from a lyophilized powder to a liquid formulation we think may also provide some advantages for patients. So just overall we feel as the market leader within recurrent pericarditis, it's upon us to continue to look at the marketplace and really understand what patients need and require within this marketplace and support alternative treatment options for patients for the future.

Good morning, Anupam. Thanks so much for your question. Your second one and yes, I can confirm that the dose that was administered and characterized in the red line was indeed subcutaneously administered, and you can see that it lasts above the target concentration for the time denoted thus supporting moving forward with a monthly dosing paradigm subcutaneously.

Thanks so much for the questions, guys.

Thank you. One moment for the next question please. And the next question will be coming from the line of Eva Fortea-Verdejo of Wells Fargo. Your line is open.

Hi, guys. Thanks for taking a question and congrats on the progress. A couple for Ross. So, first, how is KPL-387 differentiated from ARCALYST? Is it only the dosing schedule or are you expecting changes in the efficacy and safety profile? And then, a quick follow up. Just do you own the full rights to KPL-387 and 1161? Thanks.

Sure. Good morning, Eva. I'll address the first part of your question and then pass it to Sanj. Regarding the mechanism of action of KPL-387, it is distinct as it binds to the receptor subunit. This action blocks the signaling of both IL-1α and IL-1β, showing some mechanistic similarities in terms of delivery. Being a monoclonal antibody allows it to remain stable in a liquid formulation. This stability, combined with the capability to deliver enough medication to last for at least a month, as indicated by the red curve, supports the feasibility of monthly dosing in a liquid format.

Thanks Eva. Second part of your question, yes, this is an independently developed wholly-owned molecule, we do own the rights, full rights of KPL-387 at the moment.

Thank you. One moment for the next question. And the next question will come from the line of Paul Choi of Goldman Sachs. Your line is open.

Hi, good morning, everyone. Thanks for taking the questions and congrats on the progress. My first question is for John, and I was hoping maybe you could paint some broad strokes for how you're thinking about the KPL-387 clinical development plan. Are you envisioning perhaps a switch study or non-inferiority study? Any sort of broad color there would be helpful. And then second down the road, post approval and launch, can you maybe just remind us of the terms with the Regeneron arrangements if you were to sort of focus on promoting KPL-387 and just sort of what the terms of your arrangement sort of specify in terms of unwinding future promotion of ARCALYST? Any comments that would be helpful. Thank you very much.

Paul, good morning. Thank you for your question. Today, we are pleased to discuss our Phase 1 profile, specifically addressing the subcutaneously administered KPL-387 and its monthly dosing interval, which supports the design of our Phase 2/3 study. At this moment, we can confirm that we have engaged with the FDA and had discussions regarding the trial design, with plans to start in the middle of this year. We will provide more details about the trial specifics at a later date. Additionally, you can monitor updates on ClinicalTrials.gov. Now, I will hand it over to Sanj.

Yeah. Thank you, Paul. And appreciate the second part of the question. So, first and foremost, Regeneron has been a great partner, and we're really pleased with their commitment to patients, as have we. We are fully committed to ARCALYST and we believe there's an awful lot of opportunity ahead of us with ARCALYST and we continue, as you've seen, to execute right since launch. And we believe there's substantial growth. We are only 13% penetrated into the target population, as you're aware. So, we'll continue that. That said, of course, we're very excited about 387, the potential for monthly liquid formulation subcutaneous dosing, and we do believe there's also need for that. And it's a very exciting potential treatment option for patients. We do not have a non-compete with our contract with Regeneron for ARCALYST. That said, we are committed to continuing the growth of the opportunity there and obviously, we're committed to getting 387 available to patients as a very important treatment option for them as well. So, very exciting times ahead. Looking forward to continuing to work with Regeneron, helping patients continuing to get 387 on the market as fast as humanly possible. And that's what we're going to do.

Great. Thank you.

Thank you. And that does conclude today's Q&A session. I would like to go ahead and turn the call back over to Sanj Patel, Chief Executive Officer, for closing remarks. Please go ahead.

Thank you, operator. Thank you everybody for the questions. Thanks for joining the call today. Clearly, got a very exciting few years ahead. We're just going to keep on it, cracking away and I look forward to talking to you again. Cheers.

This concludes today's program. Thank you all for joining today's conference call. You may now disconnect.