Conference Transcript - KNSA 2026-06-03

Roger Song, Analyst — Jefferies

Okay. Morning, everyone. Welcome to Jeffrey's 2026 Global Healthcare Conference. My name is Roger Song, one of the seniors' covers makeup at Jeffrey's. It is my pleasure to have a five-side chat with the next company, Connexa Pharmaceuticals. So we have Ross, the Chief Operational Officer, and then also the CMO, John. So welcome, gentlemen.

Ross Moat, COO

Thanks very much, Roger.

Roger Song, Analyst — Jefferies

Awesome. So maybe either Ross or John, you want to give us a state of art where Conexa is right And then I think the momentum is so strong, the commercial launch is still, commercial sales and not even launch, so still very just strong, and then the people are expecting that the growth trajectory continues, and then obviously we have the monthly and the the life cycle management even cannot, you know, continue the tailwind right here.

Ross Moat, COO

Yeah, thank you very much, Roger. So this is Ross, Chief Operating Officer at K'Nexa, and joined with John Paolini, our Chief Medical Officer. It's a privilege to be here. Thank you very much for joining in the room and online, and Roger, to you and the Jeffress team for hosting us here today. It's always good to be here. Before I make a start, maybe I'll just share that today we will be making some forward-looking statements which are subject to risks and uncertainties, and a copy of which can be found in our SEC filings or on our webpages. So with that said, maybe I'll give a high-level overview of the organization and where we are before I hand on to Roger for the Q&A. We're pretty excited about where we are across the business. You may know that Canixer is now around 10 years old as an organization. We've made phenomenal progress up until this point. We've been a commercial stage biotech company for the last five years. The commercial progress is working along very nicely, as you may have followed in our earnings calls and some of the commentaries with Jeffries to this point, and we'll go into that more today. But in Q1 of this year, we saw strong growth. We increased our net revenue guidance for ARCALYST in recurrent pericarditis from $900 to $920 million, up to between $930 and $945 million as a net revenue for 2026. Additionally, we're also excited about the pipeline opportunity that we have and we're building. And you will know that we're in clinical trials with KPL 387. in a phase 2-3 clinical study. We are expecting data from the dose-focusing portion of the phase 2 clinical study in recurrent pericarditis in the second half of this year, and we're anticipating starting the phase 3 study by the end of the year also. For our other assets in our pipeline, KPL1161, we have said that we are moving forward and accelerating into the clinic in a phase 1 study by the end of this year also. And you may know that that's an FC-modified monoclonal antibody with a target profile of a quarterly regime for an interleukin-1 alpha and beta inhibition drug. So we're pretty excited. Great to be here and happy to crack on and go through your questions, Roger.

Roger Song, Analyst — Jefferies

I think we say the momentum for the cells in recurrent pyrocanitis is so strong. you know as the chief operating officer and then commercialize and what are the key driver here and then the more interesting thing is that we're going to continue this momentum and then you're going to do something new or incremental to continue the trajectory yeah thank you very much so acknowledging that we're five years out from from the launch when we came with our q1 earnings call a little while ago now, it was interesting to share that in Q1 of this year, we actually

Ross Moat, COO

saw the highest ever quarter-on-quarter growth of new prescribers, as well as the highest ever quarter-on-quarter growth or the quarter growth of enrollments, meaning new patients gaining a prescription for ArcLIS, which I think is quite some feat five years out from launch, but I think it speaks to the momentum, as you say, Roger, but also to the opportunity that we have ahead. We've always said that the launch in recurrent pericarditis is going to be one that we build over time. We are establishing this marketplace, and we are changing the treatment paradigm and changing physicians' mindsets from historically how they treated and identified patients and looked after this disease to this new way of doing it, utilizing a biologic and really understanding that recurrent pericarditis is a disease that is ultimately driven from the two key cytokines, interleukin-1, alpha, and beta, and by inhibiting both of those cytokines like we do with ArcList, you have pretty tremendous efficacy and a very solid safety profile with ArcList. And as more and more physicians gain familiarity with that and with prescribing ArcList and they see the effects that it has on their patients, we think that builds momentum over time. And that's ultimately what we've seen. It's also against the backdrop that unlike in many other rare disease spaces, this is a disease that is, patients are kind of pretty dispersed across the country. It's not generally looked after by a very small number of concentrated key centers of excellence that are looking after a very high proportion of the patients. So what that means is that we've got to go and educate and change the treatment paradigm with a large number of doctors all over the country and we see it It really is a one-by-one challenge of educating and informing and sharing best practices. And then as that's grown over time and now we have, you know, around 4,550 total prescribers, that's actually out of a base of around 25,000 physicians, cardiologists or rheumatologists, that actually see a recurrent pericarditis patient in a year. So you can see that we're making penetration into that, but the opportunity of switching on more and more for the future is very much there. So we're very focused on that challenge. We also have, you know, a lot of publications and, for example, the ACC Concise Clinical Guidance, which was published in August of last year, which is also emphasizing this change in the treatment paradigm that we've really been focused on since the time of our launch. and ultimately placing interleukin-1-alpha and beta inhibition after the use of NSAIDs and colchizine and before the use of corticosteroids, which is really how we've promoted this drug since our launch five years ago. So it's nice to see that, you know, other angles are also helping to kind of shift that treatment paradigm. So, you know, good progress so far, but very excited by the future. and what you would know about Konexa hopefully is that we're an organization that does not rest on our laurels at all. Yes, we've built good momentum and we've got very strong fundamentals of the business, but we very much see this as the start and the foundation for what we want to achieve in the future.

Roger Song, Analyst — Jefferies

Yeah, it's a great start. So it's getting towards the billion dollar already. So I know the initial targeted population right now, the focused population is multiple recurrence and then that population is the initial and then you do see some penetration into the first. Maybe focus on this one first and I think based on the recent estimate about 18% penetration rate just curious about what are the seeding factors you cannot get to 30, 50 even more. One of the dynamics my understanding is this population is dynamic. It's not like you have this one person all within this pool. So even you say 18%, you're actually treating a lot more than 18% of this. You know, people will have the multiple recurrence in any given time. So maybe just walk us through how you think about this TAN and then also the penetration right here.

Ross Moat, COO

Yeah, thank you. So when you think about the target addressable population in this disease space, There are around 40,000, 40,000 patients in any given year, acknowledging that this is a disease for many patients that goes on for many years. It's certainly a chronic multi-year disease. But for most patients, it's probably not a lifelong disease. So what happens in any given year is that there are patients that naturally stop having the disease, but there are new patients that go in and start having it. So you've got a kind of a static 40,000 population with a lot of kind of turn within that, which means that you've constantly got opportunities for identifying new patients and helping them as they come into the patient pool. So the target addressable population is really 40,000 patients. And then that's broken down into patients that are on their first recurrence or multiple recurrences. Out of the 40,000, there are around 14,000 that have two or more recurrences in any given year. So certainly at the time of the launch, that was really our main focus. And I think logically so, because that was where, you know, we had the majority of the data from the Rhapsody, the phase three clinical study, which was for patients that had two or more recurrences. It's also the patient population that has the highest burden of the disease. They've been suffering for the longest. And generally in this disease, the more recurrences you have, the more severe the disease is, the longer the disease goes on. So clearly there's a significant need to help those patients. But we also acknowledge that the label of ArcList is very broad and is actually completely agnostic to the number of flares that a patient has to have suffered before they actually get the help that they need through blocking interleukin-1 alpha and beta. And as we've seen kind of time move on since the very early kind of launch months and years, we've seen a shift in using ArcList earlier on in the disease. So today, you know, we're in a situation where we have around 20% of all of the prescribing that happens for ArcList is for patients that are on their first recurrence, and around 80% on the 2-plus recurrences. When you look at the 2-plus recurrence group, we shared at the end of last year we were around 18% penetration into that 2-plus recurrence group, which again shows good progress but 18% I think also tells you that there's a lot of patients there that are on 2 plus recurrences that have currently not got the help that they need with Arcalist let alone obviously the first recurrence group which is a much larger group with a smaller penetration so the opportunity is really there to help patients across the broad label of Arcalist and I think what we've seen over time is that as physicians treat their patients with ArcList and they see the magnitude of the effect that it has and how patients generally get on very well with ArcList, we've seen patients on ArcList for many years now, and the mindset rather than kind of short treatments of just treating the flare of the disease through to actually treating for the duration of the natural history of the disease over the long term, which is what ArcList was really designed to do, has really got cemented within the healthcare professional population. We've seen patients on therapy for a long time now. And, you know, the opportunity to grow much further into the 2+, and the first recurrence is very much there. As people get more familiar and see those impacts that the patient has, I think that gives people the confidence to prescribe earlier on And to really take the mindset of why does a patient that, you know, may have, you know, signs of severe disease, but they're on their first recurrence, why should you have to wait until they suffer more recurrences before they get access to this therapy? So that's what we've seen, and I think that's, you know, kind of a positive shift in the physician community over time.

Roger Song, Analyst — Jefferies

Yeah. Maybe also, John, you can comment a little bit on this population, because I think, as Ross mentioned, this is a kind of dynamic population. Some of them have a multi-year disease, but at some point, they think, I don't have a disease anymore, right? So how does churn in this, you know, even just entire 40,000, maybe more important is for the 14,000 multiple recurrence, when those patients will start to think about, okay, I don't have that disease anymore. I don't need to treatment, including the alkylists.

John Paolini, Analyst — Other

Yeah, thank you, Roger, and that's a great question about the duration of the disease because, as Ross mentioned, it's very important that the duration of therapy be matched to the duration of the disease. I think what the clinical trials have shown, as well as our residency registry data show, is that, you know, and the epidemiology data shows, you know, it's a long disease. Ross mentioned the, you know, three-year median duration of disease with a third of patients still suffering at five years, a quarter of patients still suffering at eight years, and that was the end of the data set, right? And other orthogonal data sets also point to a very long duration. And so that is an interesting question because there are no direct biological markers that tell you at any given time, you know, especially while on therapy, whether the disease is still present, and so a lot of that thinking actually begins when the patient is identified. There are, for example, risk scores that look at a variety of different presenting clinical characteristics that can tell you, at a minimum, what is the likelihood that this patient could achieve drug-free remission at one year, at three years, at five years, and so those are important variables for a clinician to think about when they initiate therapy. So as that time then goes along, patients while on therapy, certainly on IL-1 pathway inhibition, have done incredibly well. Pain, inflammation, other markers usually go quite flat. And so what we've shown in the clinical trials is that when a clinician decides with their patient that if they're interested in seeing if the underlying disease is present or not and if therapy could be stopped, There is an approach that we have tested in the clinical trials, which is that it actually takes advantage of the long duration of action, if you will, of Archelist, that upon suspension of therapy, it takes approximately six weeks for the drug to gradually wash out. And then there's usually a two-week prodrome that we saw in the clinical trials where pain gradually increased. And so it's that seeing that the pain is gradually increasing that's the marker of the fact that the disease is still present and that IL-1 pathway activity has resumed. And so while in the clinical trials we follow that all the way to the point of an actual flare, but in actual clinical practice it's not necessary to do that. If you see the increase in pain, that would then indicate that disease is still present and then therapy could then reinitiate with Rolanocept, with Arcalist, and putting the disease back under control. And those are the tools that are available to clinicians at the current date, but that allows for the long-term management of these patients so that, again, the duration of treatment matches the duration of disease for as long as they need it.

Roger Song, Analyst — Jefferies

Got it. Okay. That's very helpful. And then I visited your office a couple of years ago when we started to cover you guys, And then I think you're building a real company, right? So commercial-wise and clinical-wise. And then I think, Ross, you mentioned this targeted physician group is 25,000 cardiologists and rheumatologists. What's the current outreach look like? And then intensity-wise and how your sales rep and on the ground to cover those populations? And then I believe you have about 50% of the prescription coming from repeat prescriber. How this will change over time? And then what's the average patient number for those prescribers?

Ross Moat, COO

Yeah, well, thank you, Roger. Yeah, there's a lot there. I mean, yes, we have been very focused with both our field force execution, what we do on medical affairs as well is incredibly important because we are really shifting mindsets in the treatment paradigm and changing the learning of how people think about this disease. But we're also very focused on other ways of constructing dialogue with physicians and also with patients as well. So, for example, you know, we have been supporting the American Heart Association initiative called Addressing Recurrent Pericarditis, which I think is a very important initiative that has helped to evaluate and work with centers that really want to become pericardial disease specialist centers across the country. There are now around 18 of those centers across the U.S., and the importance of that collaboration is also how those centers share knowledge between them and the best ways of approaching and looking after pericardial disease patients per se, of course which of recurrent pericarditis is one of several pericardial diseases so we think that is very important for kind of changing the education across the country. We also recently launched initiatives such as our DTC campaign in a very targeted very structured way of going out to patients who we believe are suffering from recurrent pericarditis and in order to enable us to do that, we've actually utilized a lot of more modern learning and ways of analyzing data using artificial intelligence and machine learning to really try to specifically target the base of patients that are suffering from recurrent pericarditis and enable to serve up ads through DTC that are empowering to those patients so it increases the knowledge of not just the disease but ultimately of treatment that is available to them so we've looked at that route as well which is kind of very supplementary to what we what we do in the field and we think that's very important because you know one of those metrics you know to share with you on why we we stepped into the DTC campaign is partially because historically really DTC is something for you know bigger pharma and big disease spaces but now by using modern technology you can do things in a very targeted structured way and a cost effective way. But we know that when we do surveys with recurrent pericarditis patients who are suffering with the disease and ask them what their unaided awareness is of ARCLIST as the only approved treatment therapy for this disease, it was 14%, 1, 4%. So generally the awareness among the patient community is not very high. And maybe that's a construct of how dispersed the patient population is and where we are with kind of building this market and helping in the patients. But then conversely, when patients are aware of ArcList and when they go in and speak to their healthcare professional and discuss ArcList with them, a prescription for ArcList is written in 80% of those cases. So we know that it's actually very powerful if you can identify patients that are suffering from the disease, inform them of ArcList, and empower them to go to their physicians to discuss ARKLIS. So that's an area that we've been very focused on. But, you know, a lot of it is just continued execution in the field, in the doctors that we call upon and how we try to create, you know, a halo effect with every doctor that you switch on and then how they become repeat prescribers over time. Obviously, because the patients are dispersed, there are many doctors that just don't see many recurrent pericarditis patients in a given year. So sometimes it's a matter of time of waiting until they see the next patient, they identify the next patient to help. So sometimes there's a lag there. But as you said, Roger, we're now in a situation where about 50% of the prescriptions in a given quarter come from repeat prescribers, and around 50% come from new prescribers. And I think that's actually a very healthy metric, given that we're five years out from the launch, and the opportunity that we have ahead, as I said, to continue to switch on up to the 25-odd thousand prescribers that look after recurrent pericarditis patients and where we are with the penetration rates and the opportunity we have. So that kind of 50-50 mix, I think, actually kind of speaks volumes of the progress we've made, but the future that we have.

Roger Song, Analyst — Jefferies

Yeah, I think that's pretty encouraging. You do have a relatively low awareness among patients, but once they are aware, and then the conversion rate is very high. And then the physician part is that once they prescribe and you have 50% people they are wanted to repeat But not because they don't like the drug because they probably not seeing the patient too often, right? Okay, got it the dynamic. All right, so I understand the commercial for Aclis still the dominant, you know conversation among the investors, but also people starting to pay a lot more attention on the pipeline 387 that's probably the monthly hour one. It's the upcoming, you know, pretty soon So, you know, what's the latest message? Because we've been talking about this for a while. I think now we're about to get to the level, you know, we're going to have some disclosure or updates for the Phase 2 portion of the study. And then what would be the profile to support the next stage of Phase 3? I understand the study design, the pretty smooth transition.

John Paolini, Analyst — Other

Sure. Thanks for the question and your interest in KPL 387. We're very excited about the KPL387 program because of the possibility that this could enable once-monthly dosing in a liquid formulations for self-administration. So what we've disclosed so far is that the Phase 2-3 clinical trial is underway, right, and that we anticipate data from the Phase 2 portion of the trial in the second half of the year, and that we anticipate starting the Phase 3 portion of that trial by the end of the year. So that gives you a little bit of the time frame of how that is going. And in addition, you know, we have ongoing the transition to KPL-387 monotherapy study, which is really about dosing and administration. So the phase 2-3 study, or certainly the phase 2 portion of that, is a dose-focusing study. So we have four arms that are ongoing, you know, four arms that are in the trial. And the purpose of that is to define, if you will, the PK-PD relationship of KPL-387. So understanding that it's a phase two trial, right? And so it really focuses on onset of action. It focuses on that cadence and magnitude of effect, as well as the durability of that effect as you look at different dosing intervals. And so it's really that totality of information that comes together that will help us understand, you know, the the dose that we would take forward into the phase three portion of the trial. And that's kind of, you know, where we are and what we anticipate for the second half of this year.

Roger Song, Analyst — Jefferies

All right. And I also want to set the right expectation. This trial or the phase two portion of the trial is not supposed to see, you know, statistical efficacy or anything, maybe just so what are the key data points that we should be looking at? And then as you make the, you know, clinical strategy, so how you will make decisions to say, okay, I will move this dose to phase three?

John Paolini, Analyst — Other

Sure. No, that's a very interesting question. So you're absolutely right that, for example, with ARCALIST, the registrational endpoint came from the phase three portion of the trial in the randomized withdrawal portion. So when you see that 96% relative risk reduction, that came from the randomized withdrawal portion of the trial. And so that's a very phase three kind of endpoint, and that's what we have, as we've discussed, for the phase three portion of the KPL387 trial as well. So the phase two trial is a different focus, and you have to dial back essentially to the 2018-2019 time frame when we did the initial studies of Rolanosept. And at that time, what we were looking for, you know, we were taking patients who were on, you know, oral therapies and then looking for, who were, you know, flaring despite those therapies and then added on top Rolanosept at the time. And then what we were looking for was the cadence, so the speed at which the drug, you know, took effect. And we saw that, you know, as quickly as after the first dose. The magnitude of effect, meaning how much it lowered, you know, NRS and the inflammatory markers, right? And then that durability of effect that we saw by using weekly dosing that in that Phase II program we were able to see, you know, a consistent effect throughout the dosing interval. So in that sense, that's kind of what we saw in the Phase II portion. In fact, at our last earnings report, we kind of re-shared a little bit about what that Phase II experience looked like. And, of course, we refined and extended that at the front end in the run-in period of Rhapsody, which was the pivotal trial, but it was in that run-in portion that was roughly similar. So in that sense, the KPL387 study actually takes four dose levels into that, and so it achieves different peak levels of drug as well as different trough levels of drug over time and works different dosing intervals. And so those are the kind of pieces of information that would come out. But in terms of how we then put that together, this is part of our experience that goes back over practically a decade, to put that together into using the totality of the information to select the dose level that we believe would be the best for patients and to lead to what we would hope to be the best outcome as we proceed then into that randomized withdrawal kind of trial.

Roger Song, Analyst — Jefferies

Got it. Okay. And then because this is a once-month liquid formulation, self-injection, and then you do have the Arculus launching pretty well, sales pretty well, how should we think about if 387 is also successful and then how you're going to position those two product in your portfolio? And then not to mention that you have a partnership with, or at least a collaboration with Regeneron, so how should we think about that relationship with 387?

Ross Moat, COO

Yeah, thanks, Roger. I mean, there's a lot to be determined there, but we're just very focused on what we're doing around ArcList, the potential that ArcList has, which we think has a very bright future, given all the things that we've discussed today and where we are at the time of our launch and the opportunity ahead. So we think ArcList has an incredibly strong future, and we're 100% focused on that. At the same time, we're very excited about a potential new treatment option in KPL 387 with the target product profile that you mentioned of an interleukin-1-alpha-beta inhibitor with high efficacy and potentially a good safety profile in a monthly format. And we think that could provide a good future treatment option for patients as well. So we're very focused on the clinical picture and moving along our pipeline. But a lot more to be discussed over time.

Roger Song, Analyst — Jefferies

Yeah, it's a good problem to have. And once you have a successful S3D7 and then you're going to decide what's the strategy over there, Got it. Maybe just last minute, what's the financial guidance? I think you raised the revenue guidance for the year and then the cash, and I think you're profitable. Maybe just a last wrap-up.

Ross Moat, COO

Yeah, thank you, Roger. So maybe just to close out and kind of thank everyone for attending today. We are very pleased with where the business is overall. We have growing commercialization with huge potential left. And, you know, in Q1, we increased our net revenue guidance to between $930 and $940 million as net revenue for the full year 2026. We'll also focus on KPL 387 and bringing in the Phase 2 data in the second half of this year, hopefully initiating the Phase 3 study by the end of this year. We'll also focus on KPL 1161 to move into the clinic in a Phase 1 by the end of this year also. So, clearly, we have substantial catalysts ahead of us. And maybe as a reminder, K'nixir is a profitable organization at this point. We have strong cash reserves of around $468 million as of the end of Q1. And we are incredibly excited about the future. Thank you very much.

Roger Song, Analyst — Jefferies

Thank you, everyone.