Mirum Pharmaceuticals, Inc. Q3 FY2022 Earnings Call

Hello, everyone, and welcome to the Mirum Q3 2022 Business Update. My name is Emily, and I'll be coordinating your call today. I'll now turn the call over to our host, Ian Clements, CFO of Mirum. Please go ahead, Ian.

Thanks, Emily, and good morning, everyone. I'd like to welcome you to Mirum Pharmaceuticals Third Quarter 2022 Conference Call. I'm joined today by our President and CEO, Chris Peetz, our Chief Operating Officer, Peter Radovich, our Head of R&D, Pam Vig, and Professor Richard Thompson from King's College London. Earlier this morning, Mirum issued a news release announcing the company's results for the third quarter of 2022. Copies of this news release and SEC filings can be found in the Investors Section of our website. Given that we have Professor Thompson on the call today to discuss the exciting full results from our Phase III MARCH-PFIC Study as presented earlier this week at AASLD, we intend to keep the rest of our updates brief. Full details on updates on the quarter can be found in our news release and the 10-Q issued this morning. Before we begin, I'd like to remind you that during the course of this conference call, we'll be making certain forward-looking statements about Mirum and our programs based on management's current expectations, including statements regarding Mirum's business plans, development programs, strategies, prospects, market opportunities and financial forecasts and guidance. Mirum is under no duty to update these statements, and they are subject to numerous risks and uncertainties, and actual results could differ materially from the results anticipated by these statements. Investors should read the risk factors set forth in Mirum's 10-K for the year ended December 31, 2021, and any subsequent reports filed with the SEC. With that said, I'd like to turn the call over to Chris. Chris?

Thank you, Ian, and good morning to everyone joining us on the call today. The last quarter for Mirum was packed with major milestones as we continue to realize our vision of bringing life-changing medicines to patients suffering from rare diseases around the world. The LIVMARLI launch in the U.S. continues to track well with $47.2 million in net sales year-to-date, on track for an estimated $70 million in net product sales in 2022 for a strong first full year of approval. Setting the stage for growth outside the U.S., we recently received a positive CHMP opinion for LIVMARLI in Europe for treatment of cholestatic pruritus and Alagille syndrome for patients 2 months of age and older. Our launches in key European countries next year will also be supplemented by further approvals and demand from partner markets, like the recently announced approval in Israel. We're excited about the potential for label expansion based on the positive results of the MARCH-PFIC Phase III study. These data build on the years of treatment experience we have in Alagille syndrome and PFIC with a broader genetic type and higher response rate than earlier studies, showing the potential for improved outcomes for patients. It is a moment where the Mirum team is hitting its stride on both commercial performance and realizing the value of our pipeline. The great advances we've made at Mirum are only possible with the participation of patients and dedicated researchers. On that note, we're delighted to have Professor Thompson join us today to share the recently presented details from the MARCH-PFIC Phase III study. And with that, I'll pass the call over to Peter for a couple of brief remarks on the commercial business before diving into the new clinical data. Peter?

Thanks, Chris. Today, I'll share additional color around LIVMARLI's third quarter net product sales and upcoming plans for the commercial business. We are happy with the continued quarterly growth with $18.8 million in LIVMARLI net sales in the third quarter, and we are raising full year net product sales guidance estimate for LIVMARLI to $70 million. We continue to observe high levels of compliance and persistence to LIVMARLI and maintain strong reimbursements. Coming into the fall, we've seen an acceleration in new patient starts on LIVMARLI and continue to believe we're early in reaching the full addressable Alagille syndrome patient population in the United States. Our commercial business is strong and profitable, which positions us well as we turn to launches in international markets. Germany will be the first European country to come online in Q1 of 2023, with others following over the course of 2023 and into 2024. Beyond our core U.S. and EU markets, we expect to see contribution in 2023 from our partner markets with several approvals occurring over the next 12 to 18 months. Outside the United States, over 130 Alagille patients are currently receiving LIVMARLI from clinical and expanded access programs. These patients will be eligible to transition to commercial LIVMARLI upon local approvals. On that note, I will turn the call over to Pam. Pam?

Thanks, Peter. Over the last few months, our team has continued to take major strides in advancing LIVMARLI for pediatric cholestatic diseases. We've just returned from the AASLD Liver Meeting, where we presented exciting late-breaking data. First, we reported on PK, safety and tolerability in infants with Alagille from 2 months of age to 1 year of age. These results observed in infants were similar to those observed in children greater than 1 year of age. We also showed real-world safety and tolerability data, which demonstrated a profile that was well tolerated with only 8% GI-related disorders, including diarrhea and no GI-related discontinuations from this analysis. Now, this aligns with feedback from the commercial use of the product, where the tolerability profile has been very well received. This profile, along with the efficacy observed in Alagille, including the 6-year outcomes data that has been previously presented, really highlights the ability of LIVMARLI to make a meaningful impact in these patients' lives. We are most thrilled by the late-breaking presentation of our MARCH-PFIC Phase III study, by Professor Thompson. The MARCH study enrolled 93 PFIC patients, which is the largest PFIC study conducted. The study met its primary endpoint and secondary endpoints and included PFIC types that have not previously been studied. The postulation that higher doses would translate to a greater magnitude of response and higher response rates has played through in the magnitude of effects observed across the PFIC types exceeded our expectations. We're so excited about what this means for PFIC patients, and the data set will help answer questions that have, until now, gone unanswered. We're looking forward to digging even deeper. And with that said, it is a pleasure to hand over to Professor Thompson. Professor?

Thank you very much indeed. As a pediatrician who looks after children with liver disease and conducts research into the underlying causes of these diseases, I'm really pleased to be able to present these data because I think they are important. Following Pam's introduction, I think we can jump straight through to Slide 4, which talks about what PFIC is, which is progressive familial intrahepatic cholestasis, a group of genetic disorders characterized by abnormalities of bile composition and flow. The consequence of those genetic abnormalities is these children have progressive liver disease. But clinically, the most important thing is that they have intense atrial pruritus and other consequences thereof, particularly the impact on the quality of life for them and their families. The most frequent types of PFIC are BSEP (bile salt export pump) deficiency, and patients with this disorder are the focus of the primary cohort in this study, but as you will see from the slide there, several other subtypes are also described, in particular, FIC-1 deficiency and 3 deficiency, GJP2 and myosin 5B deficiencies, all of which are in the other PFIC cohort that I'll go through today. Previously, we've treated all these patients with off-label drugs, which had some benefit mainly on the pruritus rather than the liver disease. We have historically used a surgical interruption of the enteropathic circulation of bile acids, requiring the formation of a stoma, an external bile drainage every day, which has helped approximately 50% of patients who have been treated in that way. However, it is a major surgery with a high threshold for undertaking. Many patients have not gone through this form of surgery due to the associated risks. Consequently, the majority have ended up with liver transplants in childhood, which is effective but a major undertaking. I'm delighted that IBAT inhibitors are now becoming available as an alternative pharmacological treatment for the conditions. If you move to Slide 5, you'll see the concept, which is that bile acids undergo this intrahepatic circulation, from being synthesized in the liver, excreted in bile, used in the small intestine for the absorption of fats and vitamins. Those that are not used in each cycle are reabsorbed in the terminal ileum by the ileal bile acid transporter, a sodium coupled transporter. Bile acids are absorbed from the intestine and return through the portal vein to the liver, continuing the cycle. Patients with PFIC, however, have reduced transport capacity in the liver, leading to lower levels of bile acid and accumulation of bile acids in the liver, which is associated with pruritus and progression of liver disease. As shown from previous studies, we have observed that maralixibat improves pruritus and reduces bile acid pool size, as measured by peripheral serum bile acids. In our Phase II study, we have shown that those who do respond are associated with prolonged native liver survival and avoidance of liver transplantation. Slide 6 shows the schema of this randomized study in children with PFIC over 12 months of age, randomized 50-50 to either receive maralixibat or placebo. The entry patients had to have persistent moderate to severe pruritus and elevated serum bile acids as a further marker of disease severity. The vast majority of patients went into the open-label Phase III study with a retrospective analysis being ongoing. The primary endpoint was an improvement in pruritus measured by the ItchRO tool, previously published. The secondary endpoints include change in serum bile acids as a marker of cholestasis, changes in bilirubin, and growth metrics. Our primary cohort shows significant improvements, which is clinically important in pruritus, and again, we'll look for similar changes in the other PFIC cohorts. The totality of the data shows the clinical and biological improvements, leading to a better long-term prognosis for these patients. Clearly, we hope that these will be reproducible as we advance into the next phases of study. Overall, it looks like maralixibat is well-tolerated, and although there are side effects, they're manageable and transient. I hope to demonstrate through this study that we can systematically improve outcomes for these children, fulfilling our obligation to provide care and relief for pediatric patients suffering from these conditions. Thank you for your attention.

Okay. Thank you, Professor Thompson. As you can tell, the results from the MARCH-PFIC Phase III study show convincing promise for LIVMARLI. We plan to begin regulatory submissions early next year to get LIVMARLI to PFIC patients as quickly as possible. It was a great quarter for Mirum and for families suffering from pediatric cholestasis. With that, we'll open the line for questions for both Professor Thompson and the Mirum team. Operator, please open the line for questions.

Our first question today comes from Jessica Fye with JPMorgan.

I have two questions, one for the management team and one for the physician investigator. First for management, I think in prepared remarks, you mentioned an acceleration of new starts on LIVMARLI. I may have missed the time frame of when you saw the acceleration, but just wondering how to reconcile that with what looks like a deceleration in revenue growth that was reported? And then for the physician, can you talk about what you see as clear differences between LIVMARLI and Bylvay? If we fast forward to a time when LIVMARLI is approved for PFIC, how would you select between those two agents for a PFIC patient?

Thanks, Jess, for the question. I'll go ahead and hand it straight to Peter to comment on the top line and then to Professor Thompson for your second part.

Yes. Thanks, Jess. In terms of the comments, we are seeing an acceleration in the fall and continue to see that acceleration in new patient starts with LIVMARLI. That's really what gives us confidence in the raising of guidance to $70 million in 20% quarter-over-quarter growth that implies going from Q3 to Q4. Looking at the full Q3 picture to your question, we did see some softness in the summer. Keep in mind in the U.S. that many of these children are seeing once every 6 or even every 12 months. What we observed is families going on vacation chose not to do their physician appointments where new patient starts typically occur in those summer months. So that’s what we served, obviously, the summer months for most of Q3 but the acceleration coming in into the fall is continuing now.

So Jessica, obviously, as you know, there are two IBAT inhibitors that have been studied in these conditions. I'm delighted that we've got a positive response from both drugs, and it's disappointing that, of course, neither drug treats effectively all the patients that are being studied. So yes, there is a distinction between the two drugs. The honest truth is that despite the similarities in studies, we haven't done a head-to-head comparison. If you attempt to do that right at this moment, you may not find a statistically significant difference between the two drugs. They do have a significant response rate, thus the results at 62% is excellent, with 64% for PFIC showing response rates in terms of pruritus. I believe that the major determinants of patient response relate to the amount of residual bile acid transport. The best approach would be looking at individual mutations these patients carry. Therefore, once we have investigated these factors, can we truly determine any clinically meaningful differences between the two drugs. Additionally, other factors such as availability, formulation, and pricing will play important roles in decision-making. However, it's crucial we further explore these nuances.

Just on the acceleration of patient starts, again, I'm wondering if you can comment. Is there any extent that, that's being driven by repeat prescribers at this point? Or are you still mostly gaining patients through new prescribers?

I think we see both. The prescriber base in the U.S. is pretty well defined. There are only a certain number of pediatric hepatologists taking care of these patients. Quarter-over-quarter, we do see more coming on board, particularly from medium or smaller centers that may not have as much volume. But in terms of the acceleration, I think it kind of comes from across the board.

Regarding ICP, we are on track for the first half of next year and have seen patients come in with the updated protocol. Sorry, Steve, it sounds like you got cut off. Did you have another follow-up?

Yes. I was just asking about MARCH-PFIC and the patient with the liver transplant. If you could share details of why they ultimately elected for that—were they nonresponders? Any color there?

The reason for transplant, my understanding, is that it was the family's choice, and they were perceived to be nonresponders. While I haven't got all the figures to hand, I'm fairly certain that the discontinuations were slightly greater than seven. The majority were in the placebo group. The bile acids and the pruritus storing were not evident to the families who made decisions based on clinical grounds rather than hard data.

I want to drill down a little bit on patient dynamics and growth going forward. Have you seen any mix shift in age, mean body weight, et cetera, for patients in this recent sort of additional fall patients coming on versus the initial cohort? Also, as markets broaden next year, how do you account for revenues coming in from partnered geographies compared to others?

I'll comment on the broader international piece and then pass it to Peter for specifics in the U.S. When we think about the international markets, we are preparing for launch in Western Europe and using distributors in other geographies worldwide. We expect that these distributors will have orders that are more substantial, perhaps on a monthly basis for multiple patients—potentially leading to chunkiness in revenue recognition. However, our strategy is to have as many different distributor sources as possible, which should help smooth out any extreme variability.

On patient mix in terms of age and body weight, there have been no changes recently. It's consistent with what we saw in early FDA approval, aligned with the pivotal study in the clinical program. One thing to note is that the most severe patients tend to be prioritized by physicians initially for treatment. As physicians gain comfort with the medication, prescriptions tend to broaden to include patients perceived as more moderate, exemplifying a typical treatment pattern.

Would you be able to comment on comparability with Bylvay, given differences in trials such as measuring in the morning versus measuring in both morning and night? Overall, how was efficacy calculated in the studies?

From a high-level perspective, we know our data and how our endpoints were calculated. Unfortunately, we're not in a position to make definitive cross-study comparisons across drugs. However, in our study, we've observed consistent results regardless of the time measurements. We'll expect this consistency throughout.

My questions are directed to Dr. Thompson. Do you think any part of the MARCH-PFIC results is critical for the label that could drive stronger adoption? Secondly, could you share your thoughts on the differences between the two IBAT inhibitors compared to Alagille? Lastly, regarding Mirum working on dolobaxibat and other indications, do you see a stronger mechanistic rationale?

The critical aspects for patients are the chances of a clinically meaningful improvement and the chances of avoiding transplantation. I would indicate that there's a 2/3 chance for a clinically meaningful improvement in pruritus, translating to a 50% chance of avoiding long-term transplantation based on data thus far. Regarding the potential for future studies, it's comparatively easier to demonstrate clear results in PFIC than in other conditions due to their varying mechanisms, which complicate treatment outcomes. We believe that addressing bile acids will ultimately lead to improvements in both pruritus and liver health overall. I hope this answered your questions adequately.

Thank you for the insightful questions. I appreciate everyone for joining today's call. Special thanks to Professor Thompson for his contributions, and I hope everyone has a great day. Goodbye.

Thank you, everyone, for joining us today. This concludes our call, and you may now disconnect your lines.