Madrigal Pharmaceuticals, Inc. Q1 FY2024 Earnings Call

Thank you, Lisa. Good morning, everyone, and thank you for joining us to discuss Madrigal's First Quarter 2024 Earnings Call. We issued a press release this morning. There's also a supplementary slide deck that accompanies this webcast that will post immediately following the call on the Investor Relations section of our website. On the call with me today is Bill Sibold, Chief Executive Officer; and Mardi Dier, Chief Financial Officer. They'll provide prepared remarks, and then we'll take your questions. We're shooting to keep today's call to about 45 minutes. Please note we'll be making certain forward-looking statements today. We refer you to our SEC filings for a discussion of the risks that may cause actual results to differ from the forward-looking statements. With that, I'll now turn the call over to Bill.

Well, thanks, Tina. Good morning, and thanks to everyone for joining the call today. Before we begin, I wanted to take a moment to acknowledge Dr. Stephen Harrison, who passed away at the end of April. Becky and I attended his celebration of life last week. Stephen was a leader in the field and a great partner with Madrigal as our principal investigator for the MAESTRO-NASH trial. He worked closely with Becky and had the same tenacity and determination to bring Rezdiffra through clinical development and ultimately FDA approval as the first medicine approved for NASH. We're grateful for his years of dedication that advance this field, and our thoughts go out to his family, friends, and colleagues. I know that many of you listening to our call today knew Stephen well. I'll now move to our earnings call and an update on the business. We're off to a terrific start in 2024 and have made substantial progress against our goal to establish Madrigal as the clear leader in NASH. We achieved U.S. FDA approval on March 14; this followed the landmark publication of our Phase III trial in The New England Journal of Medicine. Following approval, our field teams were deployed and the Madrigal Patient Support Program was up and running. In April, we started shipping product to our specialty pharmacy network, and most importantly, patients started receiving Rezdiffra. From a supply perspective, we're confident in our ability to fully meet demand. As we work to expand our leading position in NASH, we're also focused on maximizing the value and future growth of Rezdiffra. To that end, so far this year, we submitted Rezdiffra for approval in Europe; our MAA was validated and we expect a decision in the first half of 2025. We continue to advance the MAESTRO-NASH outcomes trial in F2/F3 patients, and we have the potential to provide first-in-disease outcomes data years ahead of others. We continue to enroll our outcomes trial in NASH patients with cirrhosis to expand the eligible patient population, which has the potential to double the Rezdiffra opportunity. And finally, we raised $690 million in gross proceeds from our public offering. As of March 31, we had $1.1 billion in cash on our balance sheet, enabling us to fully resource the launch. So we've accomplished a great deal through the first quarter of this year and are laser-focused on a successful U.S. launch of Rezdiffra. You've heard my enthusiasm since I joined Madrigal about this opportunity, the clear unmet need, the product profile, and the strong label. My reason to believe has only been reinforced with the launch. I've been out in the field since approval, engaging with the community and the feedback has been overwhelmingly positive. My sample size isn't small. I've met with more than 100 prescribers at their offices in the field with our reps, at our speaker trainings, and at conferences. And as I think back on the launches that I've led in my career, I haven't seen this level of anticipation for any new drug launch that I've been part of. I'm more confident today that Rezdiffra will be a significant success for Madrigal and especially for the patients that have been waiting for this therapy. Much of the positive feedback has been about the Rezdiffra product profile. On Slide 4, as we discussed on our approval call, Rezdiffra has a best-case label that positions it as a foundational therapy in NASH. We've a great indication statement. Rezdiffra is indicated in NASH patients with moderate to advanced fibrosis, exactly the patients we studied in our trials. There are no biopsy requirements. It's a liver-directed oral once-daily pill with simple weight-based dosing. There are no contraindications, no box warning, and no monitoring requirements beyond standard of care. We've the enviable position of being the first to market in NASH, which we believe will give us a strong and sustainable competitive advantage. First-to-market medicines usually achieve and maintain higher market share versus subsequent entrants. We intend to take full advantage of this opportunity, positioning ourselves for long-term leadership. As we're first to market with the product profile that's incredibly strong as you can see on Slide 5, it's a liver-directed medicine that has set a high bar for efficacy. The only medicine to achieve statistically significant results on both endpoints in Phase III, NASH resolution and fibrosis improvement. Importantly, Rezdiffra stops or improves fibrosis in more than 80% of patients after only 52 weeks or 1 year of therapy. It's well tolerated with safety data in more than 2,000 patients. We've resourced to launch the right way to build toward our aspirations for peak sales. So while Madrigal, the company might be launching its first-ever medicine, our commercial and medical leaders are veterans. Each has more than 25 years of industry experience and have launched dozens of blockbuster medicines. Our field team averages nearly 20 years of experience with strong hepatologists and gastroenterologists relationships. We've the team, the talent, and the resources to make this launch a success. With this product profile and first-to-market advantage as seen on Slide 6, we believe Rezdiffra will be positioned as the foundational therapy for NASH patients with F2/F3 fibrosis, now as the only FDA-approved medicine for NASH and for many years to come. The unmet need is significant and urgent. There are 315,000 F2/F3 patients diagnosed today under the care of the specialists we're calling on, who need a liver-directed, well-tolerated therapy like Rezdiffra that will stop or reverse their disease. These patients are on the cusp of cirrhosis and are at a 10 to 17 times higher risk of liver-related mortality and don't have time to wait. Our trial in F4 patients with well-compensated cirrhosis is underway to expand Rezdiffra's indication to even more severe patients. Let's move to the Rezdiffra launch progress on Slide 7. As we discussed on our approval call in March, over the first 12 months of launch, we're focused on wiring the system. With a first-in-disease medicine, it's about spending the necessary time upfront with physicians and their office staff to create the care pathways for patients. This work builds the strong foundation needed to support the future volume of prescriptions we expect. We're making great progress. Rezdiffra has been added to the compendia and subsequently to many electronic medical record systems so that it can be more efficiently prescribed. Our field team was trained on the Rezdiffra label post-approval, enabling them to start calling on their target physicians. Our teams are educating providers on the disease and Rezdiffra as well as the operational aspects of prescribing and ensuring access for patients. This often takes additional calls upfront to familiarize all key staff at the practice with these details and address their questions. This process will become more and more established as we progress through the year, particularly as commercial payers continue to make Rezdiffra coverage decisions and as physician offices become educated on those payer requirements. We expect full Medicare coverage in place beginning early next year, which is another step towards having patients flow more efficiently through the offices. So to evaluate our early progress, we're measuring a number of leading indicators as seen on Slide 8. It's about targeting the right doctors with the right level of frequency to build the breadth and depth of prescribers needed to achieve our aspirations. The metrics so far are very encouraging, especially since we're less than a month out from when the product was shipped. We're driving breadth and depth. Our sales team has already reached more than 80% of their top physician targets. There is remarkable interest and our reps are getting access to physicians that typically don't see reps. They're engaging with the staff to ensure that many of those wiring the system activities I just discussed are completed to allow an office to more efficiently prescribe Rezdiffra. And as payers increase their coverage of Rezdiffra, and physician offices build their understanding of the coverage requirements, the volume and pace of prescriptions will increase. We're targeting the right physicians; 75% of prescriptions to date are coming from our top targets. We're driving our efforts from the top down as well as from the bottom up. Wiring the system extends beyond individual practices to the large health systems, the IDNs, GI Supergroups, the really large systems across the country. We've an experienced team that has strong relationships across these key accounts, and they're all interested in establishing care pathways for NASH patients that are at various stages of implementation. This means that a physician through their EMR system has a clear guideline to identify, diagnose, and treat their NASH patients with moderate to advanced fibrosis. Importantly, these pathways filter down to the associated individual practices. Another proof point that not just at a practice level but at a system level, the launch is progressing well. We're educating healthcare providers on Rezdiffra to drive clinical conviction for the medicine. We've held speaker training meetings, a national broadcast, symposia at conferences, and local programs across the country. There is phenomenal interest to attend these meetings. More than 1,200 prescribers attended the national broadcast – a very high turnout compared to industry benchmarks. We're engaging with payers. To that end, coverage is in place for 30% of commercial lives, tracking right in line with our goal to achieve 80% by year-end. Our reimbursement team continues to have active dialogue with payers with a focus on the comprehensive Rezdiffra clinical data set and the use of non-invasive tests or NITs as a means for patient identification and monitoring. We expect many of the larger plans to begin to cover Rezdiffra in the months ahead as they work through the typical P&T committee processes and determine prior authorization criteria. The criteria we're discussing with payers and what we're seeing in early coverage are generally aligned with our label. We also expect medical societies, such as the AASLD to publish updated NASH treatment guidelines that will include Rezdiffra and help reinforce for both physicians and payers how and when to use the medicine. Of course, we know you're interested in patient numbers, and we'll share more details on patients on our next quarterly call. What we've seen to date is really encouraging. Patient growth is accelerating, which correlates well with the leading indicators we've just described and the progress our team is making as we continue to call on more prescribers, spend time with the staff and activate more accounts. The positive momentum we're seeing is also confirmed by market research as noted on Slide 9. 90% of physicians familiar with Rezdiffra believe it offers high clinical utility. More than 80% are enthusiastic about Rezdiffra's final label and cited its efficacy, no biopsy requirement, and simple dosing as the top 3 reasons. And in our most recent wave of research with our top physician targets, 78% of respondents said they've prescribed or intend to prescribe Rezdiffra within the next 1 to 2 months. An independent market research firm reported similar findings with more than 75% of providers expecting to prescribe Rezdiffra within 6 months of launch. We're engaging diagnosed patients in a very targeted way as well. Our direct-to-patient disease education campaign on Slide 10 has been underway for a little over a year now to provide patients with NASH information and resources. Post-approval, the team is now focused on activating those patients to ask their doctor about Rezdiffra. Patients are engaged and 50% of those who registered on the site have downloaded a doctor discussion guide. In addition to the U.S. launch of Rezdiffra, we're making progress in other areas that will extend our leadership, including maintaining our scientific presence at key medical meetings. On Slide 11, you can see we're building on our strong HEOR foundation with additional publications. At the recent AMCP scientific meeting, we received recognition for our abstract that showed NASH patients were progressing even more rapidly than we thought to advance liver states like cirrhosis, liver cancer, liver transplant, and death. In fact, of those that progressed, 80% progressed directly to decompensated cirrhosis instead of cirrhosis as one would expect. The results are particularly impactful because this data is from an Optum database, which includes commercially insured patients that are likely receiving better care and are of higher socioeconomic status compared to NASH patients in other care settings. The annual cost per patient that progressed was twofold higher when compared to those that didn't, with the cost gap increasing over time. The conclusion is therapies like Rezdiffra that help stop or improve fibrosis may help alleviate the financial burden of NASH. We'll also have a strong presence at the upcoming DDW meeting in D.C. later this month and at the EASL Congress in Milan in June, where 11 abstracts have been accepted. As I referenced at the start of the call, we look to further differentiate and expand the Rezdiffra label with data from the outcomes portion of our pivotal Phase III MAESTRO-NASH trial and our MAESTRO-NASH outcomes trial in well-compensated cirrhosis for F4 patients. As noted on Slide 12, these studies will allow us to generate outcomes data years in advance of any potential competitor outcomes data, expand our indication and further extend our leadership in NASH. The MAESTRO-NASH outcomes is an event-driven trial enrolling approximately 700 F4 patients with a composite primary endpoint that assesses conversion to decompensated cirrhosis. There is an even higher urgency to treat F4 patients because of their elevated risk of developing serious and costly liver-related complications. Data from this study is anticipated in the 2026, 2027 time frame, and an indication in the F4 patient population could double the opportunity for Rezdiffra in the U.S. The potential for the MAESTRO-NASH outcomes trial is supported by data we've shown in to date in 180 patients with compensated NASH cirrhosis studied in the Phase III MAESTRO-NAFLD-1 and MAESTRO-NAFLD-OLE trials. Before passing it over to Mardi to cover the financials, let me wrap up with a brief summary of the launch. It's really remarkable how much we've accomplished in such a short period of time. We were able to achieve FDA approval in March with a best-case label and a first-in-market medicine. We had product in the channel in April and our teams are out in the field executing. The feedback we're hearing from our customers is overwhelmingly positive. There is high interest. They've the patients and they're prescribing Rezdiffra. I'm really encouraged by the early progress so far and even more confident today in the blockbuster potential of this medicine.

Thank you, Bill. The press release we issued earlier today contains our full financial results, so I'll provide a few highlights for the first quarter of 2024. As we discussed on the launch call, initial Rezdiffra shipments to our specialty distribution network began in April. So we recorded no Rezdiffra revenue for the first quarter. As Bill discussed, there is good momentum with the launch, and given the need to wire the system early on and our expectation for it to take 60 days on average to fill a prescription through the first 6 months of launch. We expect revenue to be weighted to the back half of the year with modest sales in the second quarter. We're still in the early days of the Rezdiffra launch, and we look forward to sharing more about our progress in the coming quarters. R&D expenses for the first quarter 2024 were $71 million compared to $62 million for the first quarter of 2023. This increase was related to timing of manufacturing, headcount growth, activities in our Madrigal Peer Group, and stock compensation expense. We'd anticipate a relatively steady level of R&D expense for the rest of the year. SG&A expenses were $81 million compared to $16 million for the first quarter of 2023 and an increase sequentially from $47 million in the fourth quarter of 2023. This significant increase is as expected due to the scale-up of our commercial operations in anticipation of the March FDA approval of Rezdiffra. We hired the field team in January and February, so the second quarter will be more reflective of a full quarter of spend. Moving to our balance sheet, we announced an oversubscribed public offering that grew $690 million for the company and further strengthened our financial position. Our net cash balance as of March 31, 2024, stood at $1.1 billion. Note that the green shoot from the offering was executed in early April and therefore, an additional $86 million in net cash will be recognized in the second quarter. We're fully resourced to support a successful multi-year launch of Rezdiffra.

Thanks, Mardi. Let's move into the Q&A portion of the call. We'd ask that you limit your questions to one as our goal is to wrap up the call by 8:45. So Lisa, please provide instructions for the Q&A session.

Thank you for the update. And maybe before I go with my question, I want to express my sincere condolences to you and the entire team of Madrigal for Dr. Stephen Harrison. He will be greatly missed for what he has done for the space. On my question, I guess, team, it would be wonderful if you could maybe highlight whether there is heterogeneity in the payers' discussions or if it seems that the majority of the payers are aligned in terms of their requirements of just simple blood-based tests? If you could just talk about how many payers you've spoken with, the heterogeneity, etc.? And I'll move back into the queue.

Thanks, Yas. Thanks for the question. Thanks for the comments about Stephen. Look, regarding the payer discussions, first of all, I think it's still really early. We're out having conversations. Remember, we've been having conversations for a year with the payers. And I can tell you some of the themes. There is tremendous interest in Rezdiffra in NASH. People are aware of the unmet need. They're very aware; the payers are of the cost that NASH patients have to bear. So there is great interest in learning about the product, learning about our outcomes, just learning about our approach. And the reason why I say the approach is what's resonated very well with payers is the fact that we're focusing on 315,000 patients. We're focused on those that are diagnosed that are in the office of specialists, which is also important for them. So that has been the starting point of all of our conversations. Whether it be a regional or international player, we're out meeting with them. P&T committee meetings have been scheduled. We're getting some reads early on. As you heard in the prepared remarks, we're at about 30% of covered lives now, commercial covered lives, well on the way to our target of 80% by the year-end. I'd say that at this point, there are no real surprises that we're having in these conversations, especially with the bigger plans. We expect to get this resolved. Patients are still getting drug. That's really the great thing. While this is going on, patients are moving through. We're getting prescriptions. Prior authorizations are required, medical necessity, in some cases, so right where we're right now is where I'd expect it to be. I'm happy with the 30%. We're well on the way to be 80%. There's always going to be some outliers that I talked about even before we launched, we're seeing a little bit of that, but that's certainly by no means the trend.

You mentioned that 75% of prescriptions have been written by top targets. Can you give us any color on what proportion of your top physician targets have written a prescription? And then just in terms of the prescriptions that have been written, could you give us any color on physician feedback on the medical exception process? And are most physicians going through medical exceptions at this point when they prescribe Rezdiffra?

Thanks, Ellie. So on the latter, I'd say that most are going through medical exceptions at this point. That's completely what we'd expect. In fact, if any aren't going through medical exceptions, that would be more of a surprise, because there just aren't the established pathways yet. So just to give you the layout, the prescribers and where we're focusing and where we're seeing the prescriptions? The universe of physicians is about 14,000. Our target physicians are about 6,000 of that. And that's where we've said that we've seen great success in seeing those physicians; the reps have been out and had interactions, sometimes a couple or three interactions with those high prescribers. We haven't said how many have prescribed or anything yet, but these are all some stats as we get further along into the launch. I mean, again, we've only had the product out in the market for less than a month. It's still really, really early and difficult to project from such a short period of time. But all leading indicators, and that's why we went with the leading indicators, are very supportive of things going really, really well for us.

I wanted to ask about the VA along the lines of an earlier question about heterogeneity and wanted to understand their requirement for a liver biopsy? And can you talk about how you interpret that? What you can do to lift that? And also what percentage of the 315,000 patients are part of the VA?

Thanks for the question, Liisa. And look, the VA is pretty particular, right, in that if you're going to launch a product inside of a budget year, it's difficult because they have a fixed budget. That requires congressional approval every year. So any changes to the budget are actually kind of problematic for them. So look, we're disappointed in the decision. It certainly isn't great for patients. It is certainly counter to any guideline that's been written anywhere, that says the use of NITs is adequate. And that's certainly what we believe the field is. However, the facts are the facts, that's where we're at this point. Now as we look forward to '25, then it's a new budget year, we're going to be working with the VA to have that corrected. We think that certainly the guidelines and the medical community. And certainly, the patient community is on our side to have that happen. But this is just one of those things, as I said, the 12 months that you're wiring the system, sometimes you've to rewire portions of it. And in this case, this is one of those examples.

Sorry, Lisa, just adjusting in terms of the number of patients that VA covers, it's very small. So when we do a product mix, and we've that 10% that's Medicaid and VA patients, it's in the single digits. So it's not going to be a large impact at this point, particularly in '24.

Congratulations on your launch progress. Can you share some details about the preparations you're making for the EU launch and your strategy for it, as well as how that might affect your operating expenses?

Okay. Jay, thanks for the question. We're really excited, as we said in the call about the opportunity to expand geographically. The EU is certainly a very interesting market for us. We announced in the first quarter, obviously, that we had filed. We're now working through the strategy for the EU. We're looking at what we're trying to achieve 1, 3, 5 years from now. Where do we want to be? Where are we today, the realities of where we are today versus what we think we're going to grow and become? We want to be the leading company in NASH. We think that's achievable. And we think that, obviously, that's going to come not only through Rezdiffra, but we'll develop a pipeline, and that's going to be geographic expansion as well. So we're working through those details. A little early for us to report out on them. We'll come back to you at a later call and be more specific about what we're doing in Europe. But it's an exciting moment for us to be able to expand globally.

Yes. The only comment I'd make, Jay, because we're early in our decision-making there and mapping out the expenses that the investment that we'd make, the payback will be within the 1 to 2 years. That's how we look at our strategic decision-making. So there would be an impact likely if we get approval in '25 and going into '26, but then it should pay itself back. And that's just looking at Europe specifically. Clearly, the U.S. launch will cover a lot of the spends there in the EU.

I want to dig in a little further about the noninvasive algorithm for pre-authorization that may be coming together in your insurance discussions. Per Yasmeen's question, are you finding that things are mostly blood based? Are you finding that there's blood-based plus an imaging and which imaging is being preferred? And then how could that ultimately affect time to fill? Or how could these be affected by ASLP guidelines?

Ritu, thank you very much for the question. Really appreciate it. And look, it's still early in the process. Generally, payers are evaluating a menu of the NITs. There isn't 100% consistency across. And I think you've heard me mention even the community is still working through what's the best sequence? What's the best combination of NITs? I think that the guidelines have started to help with that. I think pending guidelines will hopefully again provide additional comments on NITs. Regarding the availability, and I think you kind of hinted to that, we don't see that as a limitation at the moment. Certainly, any of the decisions that we've seen, the physicians in the area certainly seem to have access to those types of NITs. Between blood and imaging, it's typically a combination of blood and imaging. But as we have more final decisions and we've trends, we'll be able to report out to you what that looks like. We're really excited about updated guidelines. We know the community is working on them.

Congrats on the early launch progress. I wanted to follow up on some of the early payer coverage and specifically on the VA decision. Do you expect to still have any read-through to how any other commercial or government plans are likely to cover Rezdiffra, at least with their initial coverage policy decisions? And how important are updates to the treatment guidelines with respect to the payer discussions? Have you received any feedback from payers suggesting that this could help drive either more favorable coverage or less restrictive prior-off coverage?

Thank you for the question, Thomas. Firstly, I don't believe there's a connection here. We are engaging in separate conversations with each payer. As I mentioned earlier, particularly with the larger payers we are in discussions with, there is a genuine recognition of the severity of the disease, appreciation for the clinical data, and a positive view of our launch strategy. Therefore, these are independent decisions. Each payer makes its own decisions, so we don’t see a connection. Regarding the guidelines, I think they are significant. As I mentioned previously, the existing guidelines are already being referenced. However, it would be beneficial for both the physician and payer communities to have updated guidelines that include Rezdiffra and offer clearer direction on its usage and timing. We are aware that various organizations are working on this, and we are optimistic about seeing at least a draft in the near future.

So do we have any early color on the patient enrollment form? Are they exceeding your internal expectations? And when we think about rewiring of the system, Bill, you previously indicated we should not expect to see any significant revenues for Rezdiffra in 2024. Is that still the case? I just want to make sure we're clear on what expectations are going to be. And then maybe if I could sneak this in, if semaglutide shows a fibrosis benefit that's in line with Rezdiffra and its upcoming Phase III trial, do you expect GLP-1s to be step-added by payers ahead of your product? And would that affect your internal launch projections for next year?

Okay. Thank you for the questions. Let me see if I can get through them all here. Look, we aren't providing anything with patient numbers or initiations or anything at this point. So it's just too early. I think it's pretty clear in the call that I'm really pleased with the way things are progressing with the launch. Our focus right now is really this wiring the system. If we don't build a strong foundation, we will not be able to push through high volumes of patients in the future. A lot of companies make the mistake that they just try to chase getting patients on drug without preparing the practice, the payers, and the whole system for being able to handle the flow. And we're focusing on that. However, we're still having patients come through, which is really great. So I'm very pleased where we are. I'm looking forward to as we get through the next quarters of being able to further wire and also to give you a report out on just how things are going. Your next question was about the expectations for revenues.

Thanks. Yes. So Akash, just to be really clear what we said, we said because of the time to wire the system and the time for prescriptions to be filled for the first 6 months, which we estimate on average to be 60 days. So we think that comes down to 30 days after 6 months, that 2Q sales will be modest. And that sales for the year will really be back-end loaded for Q3 and Q4. We haven't given numbers for that. We haven't given guidance on that. But we've validated and said where the Street is as an average or consensus that we feel confident with. So that's the message regarding revenues for 2024.

I mean, look, I guess we'll find out more this year about if anyone manages to show the same impressive efficacy results that we've achieved by hitting on both primary endpoints. Let's see. So look, looking ahead to the future, regardless of what happens, what they show, I think you've to come back to the facts. The facts are, first of all, that there's an incredibly high unmet need. There's 315,000 patients, so there's a lot of patients. And up until March 14, I think, there was not an approved therapy. Now what was the therapy that was approved? Rezdiffra. And look at that profile. Efficacy hit on both endpoints, greater than 80% of patients have a stop or reverse fibrosis. So the response is deep, and the response is wide. So we've an effective product that happens to be a once-a-day pill that has been shown to be well tolerated and safe. So we've got a profile, which is really a fantastic profile. I mean, it's every kind of drugmaker's dream is to have a once-a-day pill for a serious disease. And I'll take that profile and we'll compete against anyone, especially since we're at the beginning of the market, we're not talking about a zero-sum game here, where market shares are all locked in place and one person is going to lose share and one person is going to gain it. We're hopeful that there are going to be other products in NASH, because it helps to grow the market. And we think that with our profile, which is still emerging. Look, we've got a proven 52-week data, and we saw this as a 54-month study. We think some of our best days are ahead actually in showing what this product can do. So will they force a product for the patient to go through a GLP-1? I don't know. We'll see what they do. But I think that on our profile alone, there is a very compelling reason for patients to be on Rezdiffra. So we're extremely confident under any scenario of what anyone else shows in data.

Wondering if you could talk about the patient services you're providing and if you're expecting patients to start on paid therapy after that 60 to 30 days or if there's going to be a lot of free drug in the system?

Okay. So Jon, thanks for the question. You mean the types of services that we're going to offer or do you want more specifically how we see that mix of patients?

I guess the latter is more informative, but if you could also speak to the first one.

We've established a thorough patient support group because we believe it's essential for the initial interaction patients have with our product. This support helps build a long-term relationship and assists patients in navigating any challenges they might encounter. Through our Madrigal Patient Support, patients can receive co-pay assistance, and those who are underinsured or without insurance may qualify for our patient assistance program to receive free medication. It's crucial not only at the outset but also in maintaining this long-term relationship and addressing any adherence issues that may arise. We are convinced that having a robust patient support services group is vital, and we are pleased with what we've initiated. In terms of providing free medication, as I mentioned earlier, during the first year, some patients will be on free medication via our bridging program. This can create some variability in gross-to-net calculations for that initial year. Our commitment to the community focuses on ensuring equitable access, as we aim to provide medication to those who need it. For commercially insured patients, the co-pay can be as low as $10. Currently, the challenge is with Medicare patients, as we missed the opportunity to address this for 2024 and are now considering options for 2025. Medicare patients may need to navigate their plans or may have to wait until 2025 for access. We are exploring alternatives for them, such as charitable foundations, and if they have a significant unmet need and cannot obtain medication through other means, we will provide it free of charge. However, at the moment, we have patients progressing through the system with paid prescriptions, which puts us in a favorable position. We will balance the needs of various patient types—insured, uninsured, commercial, and Medicare—as we move forward. This summary gives you a broader understanding of our approach rather than a specific figure, but you can expect all these elements to be evident especially in the first 12 months.

Thanks, Andrea, and thanks, Lisa, and thank you all for your time and interest today. This concludes our call. A replay of the webcast will be available on our website in approximately 2 hours. So thank you so much for joining us.

Ladies and gentlemen, thank you for your participation in today's conference. You may now all disconnect. Have a wonderful day.