Thank you, Demi. Good morning, everyone, and thank you for joining us to discuss Madrigal's Second Quarter 2025 Earnings. We issued a press release this morning and posted a slide deck that accompanies this webcast on the Investor Relations section of our website. On the call with me today is Bill Sibold, Chief Executive Officer; Dave Soergel, Chief Medical Officer; and Mardi Dier, Chief Financial Officer. They'll provide prepared remarks, and then we'll take your questions. Please note on Slide 2, we will 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. And with that, I will now turn the call over to Bill.

Thanks, Tina. Good morning, and thanks for joining us. We have a lot to cover today. Before we move into this quarter’s performance, as you can see on Slide 3, it’s been an incredibly exciting and productive last few months at Madrigal, both driving the launch and building our future. We’ve accomplished a lot, and each of these milestones reflects the deliberate execution of our long-term strategy to maximize Rezdiffra’s value and expand our leadership in MASH. In a short time, we’ve transformed Madrigal into a company with a longer runway, a stronger foundation, and greater flexibility to build for the future. Fundamental to our success is our business in the U.S., which continues to outperform. Rezdiffra’s quarterly run rate now exceeds $200 million, well on its way to blockbuster status. We can objectively say it stands among the best specialty launches of the last decade. Second, we strengthened the long-term value of Rezdiffra with our new U.S. patent providing protection till February 2045. This changes how we think about Rezdiffra’s growth potential and our investment in the business. It’s not about years of opportunity, but decades. Third, we’re preparing to expand internationally, beginning with Germany later this year. Geographic expansion adds another potential future growth opportunity for Rezdiffra. Fourth, we’re working to expand Rezdiffra with an indication in compensated MASH cirrhosis or F4c, where our OUTCOMES trial continues to progress. If positive, it could double Rezdiffra’s market opportunity. And finally, we’re building a pipeline for the next phase of leadership in MASH with the addition of a promising oral GLP-1 to combine with Rezdiffra. And we have the capital in place that will allow us to support and scale all of this. Each of these pieces adds value to the foundation we are building for long-term leadership in MASH. So let’s move into the call with our agenda on Slide 4. A lot has happened since our last call. I wanted to take the opportunity first to talk about the new U.S. patent that was issued today. We believe it’s a significant contributor to our long-term outlook. As we summarize on Slide 5, the patent covers claims directed to Rezdiffra’s commercial weight-threshold dosing regimen as prescribed in its FDA-approved label and will be listed in the FDA Orange book. And we recently learned some favorable news. The patent reflects an updated expiration date of February 4, 2045, which is extended from the previously noted date of September 30, 2044. What gives us such high confidence in the strength of this patent is that it’s based on the clear and compelling finding that different Rezdiffra doses given to two different cohorts of patients, each with different body weights, optimizes the efficacy and safety of Rezdiffra. This finding is based directly on our clinical team’s independent analysis from our Phase III MAESTRO-NASH trial, which was adopted by the FDA for our label. The bottom line, any potential generic competitor will need to adopt the Rezdiffra label and would infringe on our patent. Our confidence in this patent is also supported by precedent U.S. case law. This patent changes the game for us in two ways. First, strategically, it gives us the privilege of time. This extension creates a lot of flexibility for us to pursue our long-term strategy. We can be very thoughtful and deliberate about how we build our future and shape our pipeline. Second, it adds another potential decade of protected revenue and materially increases our value proposition, creates additional opportunity in MASH, and extends our ability to keep innovating to address unmet patient needs. Now let’s turn to Slide 6, and Rezdiffra’s second quarter performance, where we delivered net sales of $213 million, up 55% quarter-over-quarter. U.S. Rezdiffra net sales are now annualizing at well over $800 million. The significant demand we’re generating is driven by strong and consistent execution on two key launch metrics: patients on drug and prescriber penetration. First on patients, as shown on Slide 7. We ended the second quarter of 2025 with more than 23,000 patients on Rezdiffra, up from more than 17,000 patients at the end of the first quarter. As we’ve noted before, this figure represents patients actively on therapy, accounting for any discontinuations. We are encouraged by Rezdiffra’s robust growth, and yet we’re still in the early stages of this launch. Only about 7% of the 315,000 diagnosed F2, F3 MASH patients under the care of a liver specialist are being treated with Rezdiffra. There is significant opportunity ahead. Moving to Slide 8 and our progress on physician penetration. As I said before, building a strong base of prescribers early in the launch is one of the best indicators of long-term success. That’s why the pace of adoption has been so encouraging. In fact, in just over a year since approval, we’ve achieved another key launch goal. 80% of our 6,000 top targets have prescribed Rezdiffra. This level of penetration exceeds the benchmarks we track and is the direct result of the significant amount of work we’ve done to wire the system for a first-in-disease launch like Rezdiffra. We’re also seeing strong progress as we expand into our broader 14,000 target prescriber base. By the end of the second quarter, 60% or roughly 8,500 healthcare providers had written a prescription for Rezdiffra, up from 50% in the first quarter. Looking ahead, more of our focus will be on depth, which is also tracking in line with best-in-class launches. We believe this is largely due to the positive experience that providers are having with Rezdiffra, and we anticipate that it will continue to drive depth going forward. And this positive experience is being driven by Rezdiffra’s compelling profile shown on Slide 9. Rezdiffra is the liver-directed medicine with a mechanism of action that improves the critical processes in the liver that drive MASH. It has consistently strong efficacy regardless of patient subtype, including those with type 2 diabetes, who have a higher risk of progression and comprise approximately 60% of the MASH population. Additionally, Rezdiffra works effectively regardless of fibrosis stage, BMI, or genetic makeup. So it’s very consistent when it comes to treatment effect. It’s also easy to prescribe and take, being a once-daily, well-tolerated pill with no titration requirements. That simplicity matters to physicians, to patients, and ultimately, to adherence. We continue to see strong early signs of adherence consistent with what we see from other well-tolerated oral therapies. So as we look ahead to future competition, we believe Rezdiffra’s attractive real-world profile gives us a durable advantage. The next potential entrant in MASH is likely to come from the injectable GLP-1 class. And you can see on Slide 10, Rezdiffra compares very favorably across key attributes. For example, while semaglutide demonstrated an improvement in fibrosis, it was less pronounced in patients with type 2 diabetes, whereas Rezdiffra works consistently across patient subtypes. Another key difference is adherence in the real world. It’s low for semaglutide; most patients struggle to reach and maintain the 2.4 milligram dose. In addition, only approximately 30% of patients with obesity remain on the medicine after one year. This is especially relevant in MASH, where we’re talking about a 72-week efficacy endpoint. For a progressive chronic disease like MASH, providers want a medicine that patients will stay on and one that they can administer easily without a titration schedule, and that’s where Rezdiffra stands out. Certainly, a key attribute of a GLP-1 is its impact on weight loss. We also know patients with MASH may benefit from a combination approach. Today, about 25% of patients on Rezdiffra are taking it alongside an injectable GLP-1 to manage their comorbidities, and that figure increases to roughly 50% when you include prior GLP-1 users. So combination use is happening in the market today, and we expect it to grow over time. As we look ahead on Slide 11 and consider the upcoming GLP-1 launch in MASH, we believe it has the potential to accelerate the growth opportunity for Rezdiffra. Our focus remains squarely on the 315,000 diagnosed patients with moderate to advanced fibrosis. This is our core specialty market. Novo is targeting a much larger population, many multiples of our 315,000. Their efforts will raise awareness and drive broader screening, diagnosis, and treatment. This will ultimately benefit patients and we expect it will also benefit Rezdiffra, both as the foundational therapy in MASH for first-line patients and from the high real-world discontinuation rate of semaglutide. And there is clearly a need in this large and underpenetrated market for multiple mechanisms and better combinations to treat this challenging disease. That’s why we’re excited to study Rezdiffra in combination with our newly in-licensed oral GLP-1 as noted on Slide 12. We’re taking a differentiated approach focused on MASH. We are looking to develop a chronic therapy for a chronic disease with Rezdiffra as the foundation. We want to optimize the efficacy and tolerability in MASH by balancing the right amount of weight loss from a GLP-1 with the fibrosis and lipid reduction of Rezdiffra in a once-daily, well-tolerated pill. Our data has shown that just 5% weight loss can increase Rezdiffra’s antifibrotic effect. And as we assess the oral GLP-1 landscape, we had specific criteria that we were looking for. We wanted an orforglipron derivative with favorable stability and pharmacokinetic profile that was amenable to develop as a combination therapy and of course an asset that was actionable. We believe that SYH2086 from CSPC Pharma is the right oral GLP-1 asset for our program. It gives us the opportunity to develop what we believe will become a best-in-disease well-tolerated oral combination for MASH. Importantly, we secured this asset with favorable terms. We have exclusive global rights for a $120 million upfront payment and potential future payments based on the achievement of development, regulatory, and commercial milestones. We expect the transaction to close in the fourth quarter and expect to enter the clinic in the first half of next year. We will provide additional updates on our clinical development plans on future calls. Let’s briefly move on to two additional growth opportunities, starting with the international expansion of Rezdiffra on Slide 13. In June, we received a positive CHMP opinion, a key regulatory milestone that sets the stage for approval across the European Union. We expect the final decision from the European Commission later this month and are preparing to launch in Germany in the second half of this year. As we’ve discussed, we’ve made an incredible amount of progress in Germany over the last year. Leadership in our field teams are in place, we understand which providers treat MASH. We’re continuing to engage in disease education. We’ve begun our efforts to wire the system. And importantly, European guidelines already include Rezdiffra as a first-line treatment for MASH, which positions us well. Like the U.S., we’ve defined our initial target population as patients already diagnosed with F2, F3 MASH and under the care of a liver specialist. Based on our research, we estimate that the population is approximately 370,000 patients across Europe. We believe Rezdiffra can be the first medicine approved for MASH in Europe and the foundational therapy for this population just as we’ve established in the U.S. Let’s move to Slide 14 and the opportunity we see in compensated MASH cirrhosis or F4c, an important next step in our growth strategy. First, there is a high unmet need with no approved treatments and serious risk of progression. Second, Rezdiffra’s liver-directed mechanism targeting fibrosis is well suited for cirrhosis. Third, our two-year open-label data presented at EASL showed sustained efficacy and supports our confidence in the ongoing MAESTRO-NASH OUTCOMES trial. No other product or mechanism in development has shown this level of reduction in liver stiffness with such an attractive product profile. Finally, we have real-world momentum, a clear first-mover advantage with OUTCOMES data expected in 2027 and what we believe will be a best-in-disease profile in F4c. We’ve learned what it takes to launch in MASH, and we’re ready to extend that leadership from F2 to F4c period. Slide 15 outlines the opportunity we see in F4c. We’ve taken a thoughtful approach to understanding the F4c population. Our research shows there are approximately 245,000 patients in the U.S. with compensated MASH cirrhosis who are already diagnosed and under the care of our target liver specialist. These patients are sicker and further along in disease progression, which typically translates to greater and faster adoption. That’s why we believe F4c has the potential to effectively double Rezdiffra’s market opportunity in the U.S.

Thanks, Bill. I'll walk through the takeaways now from our two-year open-label extension data in F4c, which we presented at EASL. First, let's look at the liver stiffness data as measured by Vibration Controlled Transient Elastography or VCTE. Patients experienced a mean reduction of 6.7 kilopascals in liver stiffness at two years, statistically significant versus baseline. Over half achieved at least a 25% reduction in liver stiffness. As published in JAMA, that level of improvement is tied to a lower risk of progression to end-stage liver disease. And 35% of patients met the criteria for regression from F4 to F3, suggesting potential reversal of cirrhosis. Turning to Slide 17. Another critical point is Rezdiffra's potential ability to reduce the risk of clinically significant portal hypertension or CSPH. CSPH is a key driver of the most severe outcomes of cirrhosis, like ascites, variceal bleeding, and hepatic encephalopathy. It marks the tipping point into decompensated disease. In our open-label study, 65% of patients with CSPH at baseline improved to a lower risk category by year two. That movement away from high-risk CSPH suggests that Rezdiffra could help delay or prevent life-threatening complications. Taken together, these data support our confidence in the ongoing Phase III MAESTRO-NASH OUTCOMES trial because the baseline characteristics of the patients in the open-label study align closely with those in our F4c outcomes trial. For us, this means Rezdiffra has the potential to become the first approved treatment for compensated MASH cirrhosis, a very sick segment of the MASH market that currently has no therapeutic options.

Yes. Thank you, Dave. Second quarter 2025 net sales totaled $212.8 million, up 55% from the first quarter of 2025. This was another strong demand quarter. As we’ve said, we expected gross to net to be somewhat choppy early in launch, and the team has done an outstanding job managing it to date. As we shared last quarter, we’ve begun contracting with payers. We saw minimal additional impact from contracting in the second quarter with an expectation for that to increase our gross to net discount in the back half of the year. That’s fully expected and consistent with what we typically see with specialty medicines at this point in their launches. We have good visibility into the gross to net dynamic this year and are confident that gross to net will remain within our expected range through 2025. R&D expenses for the second quarter of 2025 were $54.1 million compared to $71.1 million in the second quarter of 2024. The decrease was primarily due to lower clinical trial costs. SG&A expenses for the second quarter of 2025 were $196.9 million compared to $105.4 million in the second quarter of 2024. The increase was primarily due to increases in commercial launch activities for Rezdiffra. Looking ahead, we expect operating expenses in the third and fourth quarters to be modestly higher than the second quarter. Turning to our balance sheet. We ended the second quarter of 2025 with $802 million in cash, cash equivalents, restricted cash, and marketable securities. As Bill mentioned earlier in July, we also entered into an agreement with Blue Owl Capital for up to $500 million in a senior secured credit facility on favorable terms. This non-dilutive financing consists of a $350 million initial term loan funded at closing, a portion of which was used to repay all outstanding obligations under the Hercules loan facility, and $150 million delayed draw term available in multiple draws through 2027. We plan to use these funds to pay the upfront payment for the global license of our oral GLP-1. The Blue Owl agreement also provides a mutual option for an additional uncommitted tranche of up to $250 million to support potential additional strategic business development activities. With this strong cash position, we continue to be well-resourced to support the ongoing launch of Rezdiffra in both the U.S. and our planned launch in Europe in the second half of this year, as well as for business development opportunities to build our pipeline going forward. So with that, let me briefly recap our second quarter progress on Slide 19. We continue to drive strong momentum in the fifth quarter of our launch with a medicine that’s now annualizing at well over $800 million. We have more than 23,000 patients on therapy and expect to continue to steadily add patients going forward. Physician adoption continues to build. We hit a key launch goal with 80% of our 6,000 top targets now prescribing Rezdiffra, and we’re expanding our leadership in F2 to F4c MASH with our new patent confirming Rezdiffra protection to February 2045, our progress in F4c, our expected expansion into Europe, and our exciting new oral GLP-1 global licensing agreement. And now I’ll turn the call back to Tina to open up the Q&A session.

Thanks, Mardi. Let's move into the Q&A portion of the call. Demi, please go ahead and provide instructions for the Q&A session.

Our first question comes from Thomas Smith with Leerink Partners.

And congrats on a really strong quarter here. I was wondering if you could just expand on the comments regarding gross to net and the inventory dynamics in the quarter. I know you guided to there being a little bit of choppiness, but it looks like you may have benefited perhaps from better net pricing in the quarter versus Q1. If you could just help us kind of frame where you see this going for the rest of the year? And then if you could just comment on inventory stocking in the quarter, that would be really helpful.

Tom, thanks very much. Mardi, I'm going to turn it over to you to talk about gross to net.

Yes. Great. Tom, thank you for the question. Let's just start with saying that this is a really strong demand quarter. And the team executed so well once again. Now with respect to gross to net that we addressed in the call that we've been very disciplined and we'll remain disciplined when it comes to gross to net. And we've been very consistent with our messages quarter-to-quarter. We said from the start of launch that gross to net will be choppy early in the launch, and we're still just five quarters in. So that's the case what we've seen here in this quarter. We did say last quarter that we began contracting in April and we also anticipated that we would have minimal additional impact from contracting this quarter and expect to see more of that impact in the second half of the year. So we've explained that we are very focused on gross to net. We have very good visibility and that we plan to stay within the range that we've discussed previously, that's very typical for specialty pharma launches at this point in their launch.

Yes. Thanks, Mardi. Look, and Tom, as you’ve heard me say, we’ve been extremely diligent about gross to net from the beginning, and we don’t think about it in terms of quarter-to-quarter. We’ve taken a very long-term view looking over multiple years. We know that Rezdiffra is going to be a big product. And gross to net is really important. So you want to watch it and work very carefully on it and make sure that you preserve it. So our team has done just an outstanding job on it. And so we feel really good about where we’re at. And as Mardi said, we’ve got a real strong sense of how it will evolve and where we’re going.

Next question comes from Yasmeen Rahimi with Piper Sandler.

Congrats on an outstanding quarter. I guess, team, one of the questions that I think seems to be investors asking us with the entrance of GLP-1 to the market. Let's say you maintain your pricing strategy and don't aggressively rebate to the level of matching semaglutide, how do you foresee sort of maintaining the strong growth curve that you have shown so far? And I think it's very clear that hepatologists are going to prefer liver-directed therapies. But if there is a sort of a prior authorization of GLP-1 step edits needed due to pricing differences. How do you foresee how soon that could play sort of flatten out and not become as important? So if you could just talk about that dynamic, we get that question quite a bit, and I'm sure so do you?

There are several questions in your remarks, so let me provide some context. We just completed an excellent second quarter, which was fueled by strong demand. We have been consistently increasing our patient base since our launch, and we anticipate this trend to continue with the semaglutide launch in the latter half of the year. Additionally, we saw some benefits from the first quarter, and we believe our quarter-over-quarter growth will remain aligned with other successful specialty launches that share similar characteristics. As Mardi mentioned, there's been variability in our gross to net figures each quarter. However, we have strong visibility, and we expect that gross to net discount to increase in 2025 while still staying within the specialty product range we have discussed. My comments are based on the expectation of semaglutide's approval and launch. Regarding your specific question about step edits, it's currently too early to say. The product hasn't received approval, so we don't yet know what the label will entail. These factors will play a crucial role in our discussions with payers. We've been actively engaging with them and believe we've built a solid partnership, but we'll have to wait for the semaglutide label and approval to see how things unfold. Regardless, we have contingencies in place for various scenarios. Implementing a step edit in this area could be complex, particularly since patients may have other comorbid conditions like type 2 diabetes or cardiovascular disease. For instance, if a patient is effectively managing their condition with another GLP-1, would a payer be willing to alter their treatment to switch to semaglutide for MASH? There are many intricacies to consider, and while we don't have all the data yet, we've prepared for all possibilities and remain excited about the opportunities ahead.

Yes, Bill. And yes, I would just add one more thing is, remember, GLP-1s have been on the market for a long time. And our data has been pretty consistent what we've seen to date that of the patients that we've treated, about 50% are either on or have exposure to GLP-1s already and probably 25% are on at any given time. So there's a lot of familiarity in the market already. And clearly, combination use is already established.

Yes. It’s a really great point, Mardi because this isn’t as though it’s a new product that’s entering the market that’s never been used. I mean this has been used everywhere. There’s nobody who hasn’t heard of it or has the ability to get it for some indication now. This is just an extension. So that’s a very different setup than if you have a brand-new mechanism of action entering a market, which has more potential to disrupt.

Next question comes from Jon Wolleben with Citizens.

This is Catherine on for John. I just had a quick question about your new oral GLP-1. How many options did you consider and what was your process for selection? I understand that orforglipron played a significant role in your decision, but could you provide a bit more detail on that?

Yes. Look, thanks for the question. As we’ve said for a long time, BD is a part of our strategy. And we’re looking to add the right assets to our pipeline to extend our leadership in MASH. Oral GLP-1s are something that we’ve been interested in for a long time. Like with any BD process, you look at a lot of different things before you find the one that’s just right. And that’s what we did. We laid out what we were looking for. We were looking for a orforglipron derivative. We wanted favorable stability and a PK profile that’s amenable to combo, and we found that in this asset. So it was a very systematic approach. We looked at a lot of things before deciding and coming upon the one that we think is just right to create that product which we think is going to be a next advancement in MASH. Now just the one thing I’ll say, there are a lot of oral GLP-1s out there. There are a lot of GLP-1s, GGGs, et cetera, but there’s only one that’s going to be combined with Rezdiffra in this form. And that’s how we differentiate in this market. That’s something which is special to Madrigal, and that’s something that we see a huge opportunity for us.

Next question comes from Eliana Merle with UBS.

Congrats on the quarter. In terms of next year, how are you thinking about sequential quarterly growth once semaglutide is available? And specifically on gross to net, can you give us a little bit more color on how you're thinking about how that could trend next year? And lastly, feel free to just not answer this question, but what's your latest thinking around when you might be in a position to issue revenue guidance?

Do you want to take the revenue guidance or anything...

Or any part of it. Yes. Thanks, Ellie. Thanks for the question. So revenue guidance is easy. We haven’t discussed that publicly and we have no plans in the near term to give guidance. In terms of growth, you’re asking about 2026 already, but we’re in Q2 of 2025. So we’re focused on the rest of the year of 2025. And we’ve discussed on the call and we’ll say it again now that we believe that we’ll be steadily adding patients through the rest of the year and continue our growth trend. And as you know, we follow a basket of analogs of specialty medicines that have launched successfully over the last 10 years, and we are tracking right along that growth rate of those top analogs in this basket. So we feel very good about the growth in the rest of the year. And then gross to net, I think we made those comments in 2025, and we feel good and have good predictability. And as the year goes on, then we’ll start focusing on 2026 and discussing that more.

Next question comes from Andrea Newkirk with Goldman Sachs.

Congratulations on the quarter. Bill, just as you think to a potential EU approval next month, just curious how you're thinking about the shape of a potential launch curve there versus what you've seen in the U.S.? And when might you expect to recognize first revenue?

Thanks, Andrea. Look, I think we’ve got a very good view on what curves can look like having just gone through the U.S. launch. It all starts with how you wire the system, how do you prepare, how do you educate, how do you create pathways for patients there. Now the benefit in Europe is they’ve had more time to prepare for this launch than the U.S. did. Because remember, in the U.S., since we were the first product ever approved in MASH, the community had been met with disappointment over 20x. There’s the guidelines in Europe that exist already and with the U.S. getting approved, Europe’s had a little bit longer to prepare. But like any other launch, especially when it’s a first in disease, it takes time, and we have some really good first-hand experience with that in the U.S., and we’re taking essentially all the learnings from the U.S. and transferring them to the really outstanding team that we’ve hired in Europe and specifically, Germany, and I just want to put a fine point on that. It’s Germany that we’re launching in first. We’re not going everywhere all at once. We put extremely rigid guidelines in place for what we need to see in a market for it to launch. So more to come. When will we start recognizing revenue? Look, I would say it’s really not much of a – there’s not much happening in ‘25. We’re going to be starting in the second half of the year in order to get the teams deployed, et cetera, it takes a little time. So really, it’s more of a ‘26 and on story.

Next question comes from Andy Chen with Wolfe Research.

Mardi, you talked about this basket of specialty drugs. Can you give some numbers around what this gross to net range is in that basket that you're analyzing? And then this 20% to 30% that the gross to net that you're guiding to, is that an educated guess and prediction? Or is that already a largely known fact, given your existing contracting negotiations and you know that it's going to end up in the 20%, 30% range?

Andy, thanks for that. I'll turn it over to Mardi in a second. Just to be clear on that. We are very, very clear on the 20% to 30% that is based on decades of experience and knowledge and how our conversations have gone with the payer community. So like everything else that we talked about in this launch, we've been very accurate in our comments that we make to all of you. So maybe I'll turn it over to Mardi for any other comment that you have Mardi. But look, we don't say things just to say things. We say things because we're confident in them.

Right. Yes, just to reiterate that, Andy, we have good visibility for the rest of the year. We’ve talked about this range since I think our first launch quarter, and we feel very strong that we’re tracking along with typical specialty medicines and that the gross to net for 2025 falls within that range. And there’s a lot of components to gross to net, many components, of which contracting is just one and we did say we started contracting in April, and then you’d see more of that in the second half. That’s just sort of the natural dynamics in this marketplace and launching in the U.S., all very predictable for 2025 as we move forward. So we feel good about that. And just to reiterate a point that Ellie asked too, we haven’t commented on 2026, but we see this drug as continued growth and robust growth as we move forward and as we steadily add patients.

Next question comes from Ritu Baral with TD Cowen.

I wanted to ask about some of your underlying plans, Bill, as far as continuing this growth momentum into the potential Wegovy label expansion. You hit your target of 80% prescribers in that top tier. What's the next target? And how does that overlap with your understanding of Novo's potential detailing target for that label expansion? And as part of that answer, could you address the sort of growing awareness of MASH in the diabetic population and amongst endocrinologists? Are they part of that next tier?

Thank you, Ritu. We don't have a specific next target to announce. Right now, our focus is on depth. The breadth of prescribing we're currently experiencing is leading the way for the other products we're examining, including the analogs. We've really excelled in that area. The next step is to focus on depth, and we're observing positive indicators with those analogs as well. The first key indicator is breadth, which leads to depth, and we're seeing more of that. The reason for increased use is the impressive results and real-world experiences we're hearing about. Physicians I've talked to consistently mention how impressive the actual outcomes are and that they're exceeding expectations. Regarding the future from an endocrinology viewpoint, some endocrinologists are quite enthusiastic about Rezdiffra. We've started to engage more with those physicians and will continue to do so. Our primary focus remains on hepatologists and gastroenterologists, but we'll also seek to connect with more endocrinologists who are interested. It's interesting to note that endocrinologists are very curious about the mechanism of action. When they learn about the THR beta aspect, they're excited because it reflects something relevant to their field, even though it's specific to the liver. We do have target areas that will expand as well. Is there anything else, Ritu, or does that sufficiently address your question?

Next question comes from Akash Tewari with Jefferies.

This is Kathy on for Akash. To follow on the gross to net question from before. I know you said you'll see more of the contracting happen in the second half of the year. But based on our math, it looks like the gross-to-net for this quarter roughly returned to Q4 levels. And then we also anticipated a potentially higher Part D impact from this quarter versus last quarter. So what are the biggest drivers behind this price improvement for the quarter? And can you give us some color on the Part D redesign impact this quarter as well as the stocking contribution and the driving factors behind that increase?

Thank you for the question. There were several points raised, and I'm not sure we can address all of them. Mardi, would you like to add any comments?

Yes, let's begin with the easy topic of stocking, which is not related to gross to net. It was a strong demand quarter, so we don't need to discuss inventory any further. Now, regarding gross to net, there has been a significant focus here. To reiterate, the range mentioned earlier for typical specialty medicines during this launch phase this year is 20% to 30%. We mentioned that contracting, one of the several elements in gross to net, started in April and is a normal part of our business. We expect it to continue widening through the end of the year, remaining predictable within that 20% to 30% range. As for Part D, I thought we clarified this earlier, but the impact from Part D was discussed in both the fourth quarter and first quarter calls. This impact is incremental to what we noticed in the fourth quarter due to rebates we had at that time, thanks to the timing of our launch. Therefore, the new IRA Part D impact will be minimal going into 2025, given our starting point from the fourth quarter of 2024. Overall, gross to net remains within the expected range and we anticipate it will continue to do so through the remainder of 2025.

Yes. And look, I mean, we were clear on our first approval call that we would have a choppy gross to net for a period of time. But just what happens in the launch. And just to reiterate again, there are a number of components of gross net, including co-pay assistance. I mean, we have a $0 co-pay assistance program as well which is getting greater and greater utilization. It’s really important. We want patients on co-pay assistance because that just makes it more affordable, which leads to better persistency, and leads to better outcomes for patients.

Next question comes from Mayank Mamtani with B. Riley Securities.

Congrats on a very strong quarter. Could you give us a little bit more detail on the claims of this newly issued patent with 2045 expiry? I guess it's related to the method of treating MASH where those finding work in humans, was a nonobvious finding. And also was curious if there's plan to further build on this with the F4c outcomes data emerging? And then I have a quick follow-up.

Sorry, what was the F4c question? I missed that.

Yes, if there's additional patent work you may do as the F4c and the OUTCOMES data still kind of emerging there?

Yes, great. That’s something look, we don’t have the trial outcomes yet. We don’t have approval yet. Certainly, there will be – we’ll look for opportunities with the F4c indication, we hope, in the future. But look, I think the patent you saw this morning or you are – it’s available now. And as we said, it’s based on clear and compelling evidence that different Rezdiffra doses given to two different cohorts of patients, each comprising different body weights optimize the efficacy of safety – efficacy and safety of Rezdiffra. So that’s the headline for it. We think this is a very strong patent. This is something that has become our base case now. As we think about all of our planning in the company and how we’re thinking about our plans for everything from BD to just investment, et cetera, 2045 is our base case. So look, I think I’m going to let you all spend a little bit more time reading it and so forth. But we think all the facts are very clear. We think that there’s good precedent as well in case law, and we’re really excited about this. This is a really, really, really important development for us as a company.

Next question comes from Jay Olson with Oppenheimer.

Congrats on the quarter and all the impressive progress, especially with life cycle planning. In your due diligence process, can you talk about any preclinical or clinical work done to support a fixed-dose combination of SYH2086 with Rezdiffra? And now that you have an oral GLP-1 what other mechanisms are you considering? And how are you thinking about future business development deals in terms of timing and priority?

Great. Thanks, Jay. Maybe I'll start with just the last bit and then I'll turn it over to Dave. Look, BDs are still very much part of our strategy. We think this is a great first step, but we will continue to look at next best mechanisms of action that are going to add potential value to MASH patients. Either as a stand-alone or in combination with Rezdiffra. Now we really believe that the market is going to move towards combination therapy and that Rezdiffra is going to be the foundational therapy. It already is. It's a standard of care today. And what you see in a lot of different diseases is that you add to that standard of care, whether it be for a different effect you're looking for, a subpopulation, et cetera. Remember, we are at the absolute very beginning, 7% penetrated into this 315,000 population with decades, I would say, of growth in this marketplace ahead of us; it’s going to support multiple mechanisms of action, multiple products. And as the leader with the foundational product looking for those next white spaces or areas of opportunity is something that we are going to be a part of, and more than that, we are going to drive. So Dave, maybe do you want to talk a little bit about this asset?

Yes, sure. I think first of all, let's touch on two things. First of all, the scientific rationale for combining a GLP-1 with resmetirom. And then second, we can talk about this molecule in particular. So we already know based on our experience in MAESTRO-NASH that as little as a 5% weight loss will enhance the efficacy of resmetirom in NASH. So we see better biopsy results in patients who achieve as little as 5% weight loss. So as we talked about, we can achieve that more effectively and in more patients, that level of weight loss by adding a GLP-1 mechanism drug to Rezdiffra. So the scientific rationale, I think, is very, very strong for combining the mechanisms. Second, with respect to this molecule, in particular, Bill touched on some of the properties that we were looking for. We were looking for chemical properties like the structure. We wanted to make sure that came with a derisked structure like in orforglipron backbone. And we wanted to make sure that the pharmacokinetics and sort of initial pharmacology were consistent with what we were seeing with other molecules in this class. So that gave us that assessment, I think it's important to sort of mention that this is still a preclinical asset, and there's still work to be done before we get into the clinic. But from what we've seen, we're very excited about combining 2086 with Rezdiffra.

And maybe just one final point on that, Jay. Fixed dose combo would be great, but it's not completely necessary, right? And again, I think that you have to go back to when you've got the runway that we've got to 2045, right? We had the time to do things in a very thoughtful, precise way. Ideally, it's a fixed-dose combo, but doesn't have to be. It just be more convenient for patients. But we like the properties that would make that a good probability.

Great. And Demi, it looks like we have time for one more question, please.

Next question comes from Kaveri Pohlman with Clear Street.

Congratulations on your progress. I would like to understand the competitive landscape and your reasons for selecting GLP-1s over the various dual and triple agonists available. Additionally, how are you considering the potential benefits for MASH patients with increased weight loss? Do you anticipate any off-label use as this area expands, particularly concerning the oral drug you have? Are there any concerns regarding overlapping toxicities? Given this, how are you planning to approach development? Will you be testing different doses and schedules for both drugs, or will the GLP-1 be adjusted based on the approved regimen for Rezdiffra?

Thank you for the question. There's a lot to address, so let me touch on a few points briefly. We have a preference for oral GLP-1 for the reasons previously mentioned. With just a 5% weight loss combined with Rezdiffra, we observe improved effects on fibrosis. This positions us favorably. However, other products focus primarily on demonstrating maximum weight loss, which creates a competitive landscape based on minimal percentage differences. Our aim is to find an oral GLP-1 that surpasses the 5% threshold while ensuring it's well tolerated, allowing users to maintain it in their regimen, thereby enhancing the overall effectiveness of Rezdiffra. This signifies a shift in our strategy. Rather than targeting substantial weight loss, our primary goal is to achieve a specific weight loss that could enhance the therapeutic benefits of Rezdiffra. It's important for people to understand this perspective as it illustrates how we approach development thoughtfully. Regarding the product profile impacts, our goal is to create a well-tolerated medication without compromising any key aspects, and we’ll explore this through appropriate dosing and adjustments. However, it's too early to discuss our development plan in detail. We will provide updates in due course. Additionally, business development remains integral to our strategy, and we're considering ways to maintain our leadership in MASH.

Yes. I would just add one thing with respect to the diligence on the molecule. So of course, one of the things that we were looking at was the preclinical profile and ensuring that this molecule would be, at least from a preclinical standpoint, compatible with resmetirom. And so we were reassured by our diligence process. And so we're very excited to have this and tested in the clinic.

Thanks, Dave. And thanks, everyone. Thanks, Demi, and thank you all for your time and interest today. This now concludes our call. A replay of this webcast will be available on our website in about two hours. Thank you for joining us.

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