Mineralys Therapeutics, Inc. ($MLYS)

We have from Mineralys, I have here with me today, Jon Congleton. Jon, thanks for joining us. I'm just going to hand it over to Jon for some opening remarks before we dive into some Q&A.

Thanks, Dana. I appreciate it. I appreciate the opportunity to participate in the Bank of America Conference was a positive conference for us. So Jon Congleton, CEO of Mineralys. We had a very productive 1.5 years, I would say. -- last year with a lot of data readouts nominated in the submission. We had opening call last. We announced that -- during Q1, we had the acceptance of the NDA, a significant milestone from Mineralys. That puts us 1 step closer to the 1 stat to patients that fundamentally need this drug. That NDA -- very proud of what the team put together the thing it's very distinct and differentiated data set of things going. And what are the FDA will review effectively 5 clinical trials showing a very consistent robust benefit that has online blood pressure to safely profile -- but I think that's easily into the use case that physicians have for those unfolded resistant. Is that better? So obviously, only you in the room got the opening preamble. So that data set to me, is very important because it speaks to the 20 million patients in the United States that are on 2 or more meds and cannot get to goal. For those of you that have met me in the past, you know I started my career as a sales rep in the hypertension space. And so I saw the great innovation and how transformative that was in the '80s and '90s, but we've lacked innovation, fundamental innovation for 20, 25 years. Aldosterone is the uncovered target that's going to help a significant portion of those 20 million patients get the goal. We think the data set that we have generated to date shows that benefit. The market research that we do whether it's with patients or physicians or payers, the demand, the intent to prescribe the interest, the enablement of access is all there. I think really focusing in on, and we started guiding to this in our earnings call, the resistant hypertension patient population is probably the beachhead. That's the low-hanging fruit. That's where there's just continuous churn within this marketplace that notes the dissatisfaction with currently available treatments, that notes there's still energy and interest in trying to get to goal or get closer to goal. And that's where I think we'll understand can certainly provide benefits. So this year, with the NDA acceptance. We're continuing to prepare for a successful launch for the molecule. What that means is we stood up a national account team in. We're having those pie or those preapproval information exchange dialogues with the payers as we speak. We've got MS cells out in the field going deeper into the advocacy space. We know Baxter stat has potential FDA action coming up, but I think it's important to realize that while they may have 6 months ahead of us, we're not silent in that marketplace. We're having the dialogues with the key constituents, both payers and KOLs are going to be important to really ensure we have a successful uptake of this drug, presuming positive FDA action later this year.

Great. You can dive a little bit more into some of the commercial things you outlined, looking ahead to the stat approval and potential launch. So with LaRonde trap being about 6 months behind Axtrastat's launch, what are you kind of looking to learn from AstraZeneca's launch? Is year 1 more about establishing product differentiation or just building out market and awareness for this new approach in the HTM space?

Yes. I think it will be interesting to see the label. It will give us some insight into the FDA, how they view that package that will be informative for us as we head into our negotiations with the FDA later this year. What studies were included, the indication how Section 14, which has all the clinical data -- and then beyond just the approval, their launch, how they think about pricing, access, go to market. All of that will be very informative for us. I think that creates a bit of an advantage being 6 months behind us to see all of those moves and then we can kind of have our counter rooms that we have in mind relative to that. The first year, I think, is going to be a little bit of both. I think it is going to be about building the awareness, building the awareness around the importance of targeting aldosterone, the use of an ASI relative to that, but also the differentiation between these 2 molecules between these 2 data sets. Again, I think that data package that we have is going to speak very distinctly to the constituent prescribers within this resistant hypertension space. We know it's partially made up of cardiologists, that's why we did advance 10 probably the most challenging study done as far as any confirmed resistant and uncontrolled hypertension population. Launch HTN, the largest ASI hypertension study done to date. We'll speak to the primary care prescribers. And things like Explorer CKD will also speak to the nephrologists who are dealing with patients with a lower GFR with uncontrolled and resistant hypertension that is the #1 target these nephrologists look for to help control CKD, and that is get their blood pressure below -- down to go where it needs to be.

You put some numbers around kind of physicians that are responsible for certain percentage of third line prescribing about 60,000 physicians are responsible for about 50% of that third line HTM prescribing. What is that split between primary care versus specialist? And what role do you see dedicated sales force versus DTC playing?

Yes. When we think hypertension, we tend to anchor to the 120 million patients that have hypertension in the U.S. alone, and that immediately gives you this view -- must be a ton of prescribers. And there are. But when you begin to get further in the lines of treatment, that population narrows. It's a typical pyramid of prescribing. And to your point, we've noted about 60,000 doctors control about half of the prescribing third line and later. What's interesting about that is they also influence the other half because these are the kind of the top pyramid, they're easily in hypertension centers, whether they're cardiologists or primary care. They're the ones that are driving the volume and they're influencing the other part of the volume. The split is about 60-40, primary cardiologists. It doesn't mean that there won't be nephrologists or even endocrinologists within that mix, but largely primary caring cardiology. I think DTC is but a tool to use along this continuum. I think where I get excited about where we're at in 2027, which could be a potential launch here is there are technologies digital that enable a company like Mineralys to actually act and be bigger than we are by what -- so certainly, we'll have the appropriate size sales force to affect the behavior of those 60,000 physicians, but we can also use digital nonpersonal power technology to extend the reach, augment those sales reps get to white spaces where we may choose not to have sales reps just as far as discrete uses of capital. DTC, DTP, all of that may play a bit of a mix within that part of the goal, again, back to I think your question, it's a combination of raising awareness of the role of aldosterone, the need to target aldosterone and the differential story of Lorenson.

You've kind of mentioned that fourth-line setting is where you at least initially see uptake for LaRonde Strat. Can you just speak to when we could see or when you expect expansion earlier to third line? And what the drivers behind that could be?

I think the way we view it and what we hear in the market research we do is -- at launch, there could be interest there even could be access. As we talk to payers, it's not just fourth line and only 4 point. There are some payers that see the absolute need of helping their patients get the goal having their constituent they being the payers, the PBMs, having their constituent population goal as part of their quality scores. So whether it's Star or HET we're seeing hypertension in getting those patients to goal is becoming more and more important to payers. So it's fourth line is kind of the ideal target. Third line, where it really gets more compelling for payers for prescribers is when there are comorbid conditions. So if you have hypertension in CKD, it's why we did the EXPLORER SA study because there's such an overlap of OSA with hypertension. So having those more complex patients having a data set that speaks to that complex patient population is what I think begins to open third line. But I think also just in due time, that fourth line utilization having access created having physicians prescribing is then getting gender utilization earlier in the treatment paradigm. Because fundamentally, that dysregulated aldosterone doesn't just suddenly appear in a fourth-line resistant hypertension patient population. Frankly, they probably had it throughout their journey of treatment and are finally getting to a point where they need a very exquisitely targeted aldosterone therapy. So getting earlier in the lines of treatment is part of the story that Liunderstat will have over its line.

And this is a space where kind of the hypertension guidelines pretty clear and drive a lot of the prescribing patterns. So at what point -- do you kind of see the hypertension guidelines begin to incorporate the data from the launch in advance trials? And could it happen before launch? What are your expectations kind of on timing for that?

Yes. We've been meeting with various constituent bodies, meeting with KOLs who are part of those committees, making sure they're aware of lorenderstat our data set -- the guidelines used to be fairly rigid. The guideline committees used to be fairly rigid as far as how frequently they would update the guidelines. I think they're acknowledging now that we're in a bit of a renaissance with new technology, new therapeutics coming in have become less rich. In other words, when there's innovations, they want to make sure that they're guiding their constituents on how to think about utilizing those. I don't know the specific timing of it. I do know that that's been something top of mind for us going back 5 years when we began meeting with Steve Nissen in Clinic. That was why we did the Advance HTN study. Fundamentally, we wanted to go to the guideline committees with the absolute best form of evidence for inclusion in advanced frankly, is probably going to be a bit of a lift for Baxter stand as a class, because we anticipate the class will be treated fairly similarly by those guidelines, but we definitely have the data set that will be most informative for those guideline committees and how to think about utilizing Morinda and ASIs in third and fourth.

Mindfully, you can't comment necessarily on label. But -- and you mentioned -- touched upon this a little bit before, but -- what are your expectations -- or sorry, what are the most important like label variables in your view? How are you thinking about -- you mentioned comorbidities, the data you have being an important value proposition? And how do you think the EXPLORER CKD data could be kind of reflected in the label? And maybe your thoughts on doses, like how those would be -- is the 25-milligram dose going to be included in the label?

Yes. I think it's back to 1 of your earlier questions, I think seen the -- presuming a positive action with Baxter stat seeing their label is going to give us a little bit of insight into how the agency is looking. I think our working assumption is right now, both of these drugs will have near identical indication. So treatment front controlled blood pressure, inadequately control blood pressure on top of background meds. It won't prescribe the number of meds that won't prescribe resistant hypertension only, it will just be fairly broad. And that's consistent with what the FDA has talked to us about for 5 years. So I think the indications will be quite similar. I think the Section 14 is where you'll potentially see some distinction. Back HTN is certainly going to be or to that approval, what role does banks 24 have other data they have, how does that get incorporated. From our standpoint, again, that's why we did a very distinct clinical development program for lorunderstat. I would anticipate both launch and advance being included in Section 14. EXPLORE CKD, the blood pressure reduction, which is, again, a very important thing to be able to convey the nephrologist in a lower EGFR population. You can safely use this drug and see blood pressure reduction. We did include about 25 and 50 milligrams in the NDA submission. Again, it will be part of label negotiations with the FDA, but we would anticipate both those as being available. We think that's important because when you get to patients that are -- have more complicated control and resistant hypertension, such as those with lower eGFR you've got to be mindful of the safety profile, specifically for the on-target adverse events like hyperly hyponatremia, change in eGFR. And so having a lower dose, was important. It's why we tested that. And so I think fundamentally, the distinctions that are seen with the clinical development programs have the potential to be seen and revealed within the distinct labels between these 2. But again, time will tell and that will be part of the negotiations that we'll have with the agency later this year.

You mentioned hyperkalemia. What -- do you think there's going to be a need for physician monitoring of potassium levels? If so, how frequently?

Yes. I think the beauty of the ASI is they fit within an existing treatment paradigm that physicians already have. And that's driven by ACE inhibitors and arms. They have a very similar profile. These are RAS inhibitors. At the end of the day, SIs are part of that RAS system and you see a very similar construct of response that fits the current use case. And what does that mean? That means Currently, when a physician prescribes an RAS, they get a blood panel, they do blood pressure draw, they start them on a Nasea and bring that patient back in 3 to 4 weeks. -- again, they get a blood draw, they look at taste they look at sodium, they look at changing EGFR and then they get a blood pressure measurement. The ACE inhibitors and ARBs tend to have that profile shipped within about 2 to 4 weeks and then it stabilizes. What we've seen with LaRonde said is a very similar construct. Within 2 to 4 weeks, you see or so of the blood pressure reduction. You see any increase in potassium decrease in sodium and change in eGFR occur within that 2- to 4-week period and then tends to stabilize. And so that fits very nicely into the existing treatment paradigm that physicians have. And I think we're going to see that reflected in the label as well. So the labels for the ACES and arms follow that construct. Get a blood panel, measure blood pressure, bring the bank went 4 weeks, do the same and then monitor period. So I would anticipate that's what the label will guide. And I would anticipate that's likely to be a class effect. I don't think there'll be a distinction between the two.

Maybe turning to the OUS opportunity. How are you thinking about the relative importance of the OUS market versus the U.S. market? And OUS, what in your view are the key geographies.

Our goal ultimately, the purpose we talk about a Mineralys lot is more better days, 3 words that are fundamentally linked to what better control of blood pressure means for patients. We know -- it's frankly why we'll get an outcomes claim if we get approved because there's such strong linkage between lowering BP and better long-term outcomes. Our goal within that is, is to get this drug to as many appropriate patients as we can. And that's not just in the United States that includes outside of the United States. I have been clear in the past that Mineralys will not be the 1 that will introduce some runners debt outside of the United States that will do that through partners. We haven't guided to specific targets by region or by country. But it is important that we great access for patients, create partnerships that may be global in nature. That's where our main focus has been as opposed to regional, but to ensure that we get this drug to as many appropriate patients.

Can you just give us the latest on your thoughts on the OUS regulatory submission -- is it gated by partnership discussions? What's kind of the time line there and just kind of your latest update there.

Yes. I don't know that it's gated by partnering. I think we have the appropriate data set in hand, certainly for Europe, Japan, we may need to build some additional in population data -- but even that, I think, is becoming more streamlined. We haven't given specific guidance on the regulatory. Our main focus right now has been on the U.S. on working with the FDA to get lorendastat approved in the United States and caring from a commercial launch standpoint.

And on the commercial launch, maybe on thinking about the size of the field force, gearing up to invest in that. When do you kind of plan to update -- the Street on sales and marketing costs to support your U.S. launch? There's some of the pull -- pushes and pools relative to comp launches that historically might have involved a very large 700-person sales force team.

We haven't guided on the size of the team yet or specifics around our go-to-market model. Part of that is just, frankly, a little bit of competitive protection so that we don't reveal our strategy too soon. We may do that in future guidance. To date, we haven't done that. If we feel it's appropriate, we want to -- I think we've always tried to be as transparent as we can with investors, but we also need to be mindful of the competitive nature of the market we're going into.

Maybe turning to pipeline and label expansion opportunities here. For OSA, you shared some data earlier this year. Just maybe curious to your kind of your thoughts on that data. Did the Phase II study design, kind of limit the lower interest rate ability to show benefit. Curious your thoughts there? And where does OSA kind of go from here? What's the pop forward?

I think it's important, why did we do that study. We did that city because there's -- when you get to a resistant hypertension patient population, you have a convergence of a lot of factors. It's not that patients just in isolation have resistant hypertension. I think about 85% of OSA patients have resistant hypertension. There's massive overlap with obesity within this population. And we saw that within the baseline characteristics of this study. I think the BMI average was somewhere 37%, 38%, a significant portion or more albeit the BMI over 40%. The AHI, which is the index of how severe our SA is is 48%. Sber begins at 30. That means they had 48 apnea hypopnea events per hour. -- and they were resistant hypertension. This study was intended to be a quick 4-week crossover design study, I think it was very informative for us. Again, we saw a very consistent reduction in blood pressure that we've seen -- had seen in 5 studies -- or 4 studies preceding that. So while we didn't see a signal in OSA, I don't know that it means the pursuit of that is done because, frankly, future studies we're going to do, we're going to see that overlap. And we'll be able to continue to dig into that see with longer time, maybe in a less effective population that, that translates not only into a benefit on BP reduction, but potentially on the symptoms of OSA. But fundamentally, you make no mistake, lowering the blood pressure is what's improving the cardiovascular risk for this population. There have been countless studies, whether it's with CPAP, other agents that lower AHI, but have not impacted blood pressure. And so that does not change their cardiovascular risk profile. It's having that control of BP that fundamentally translates into that reduction in CV risk. And so that's why I think there's a lot of positive big becomes out of the study was not part of the NDA submission. But by virtue of if we get approved for the reduction of blood pressure, we're going to be able to use that study as part of our communication, whether it's promotion or MEDCOM because it's all about lowering BP in these more complicated patients.

And you spoke a little bit about this, but does -- do these data impact your view on probability of success for other profiling studies or other adjacencies. Yes, heart failure, CKD, kind of those other opportunities for Lorana.

No, I don't think it does. I mean certainly, CKD, export derisk that. In fact, it gave us a data set that would enable us to go in and speak to physicians who are treating patients with uncontrolled or resistant hypertension and CKD, lower EGF on. And that's why in that study, we had a key exploratory was reduction in UACR and just in 4 weeks, we saw a 30% reduction in UACR. So Clearly, we know there's a benefit with Lorenesdet on BP on kidney function. And if you look at where the medical community is going as far as how they think about kidney disease and heart disease and heart failure, they're not in these silos or isolated syndromes, which is, I think, where medical community was 15, 20 years ago. They're now realizing they're even doing the CKM initiative, but these are all interrelated. You got to a heart meeting, you're going to hear about the kidney. You go to a kidney meeting, you're going to hear about the heart. So aldosterone sits at the nexus. And I think we've progressively de-risked, obviously, Lorenestat for blood pressure benefit, but even beyond that, what it can do for kidney, for heart, likely for stroke as well. So I think hypertension is the beginning of the story, not the end -- and I think where we've taken this molecule to date derisk the profile of it opens up a lot of opportunities for further clinical.

And on that further clinical development, should we kind of be thinking about these studies or how you're going to pursue these indications in the future? Is it about indication expansion versus label boosting.

I think maybe a little bit of both. It's part of the partnering dialogue as well. It's not -- partnering is not just about the commercial, it's not just about promotion, either U.S. or ex U.S., but it's also about how we continue to expand the value lorendestat in these other indications. If I look back at what we've done to date, and again, that's why we did very distinct studies, they really bolstered the hypertension profile itself, having, because again, it's hypertension is not in isolation. It's driving these other conditions, showing a benefit on BP and these other conditions, builds that value prop, but it also is about indication expansion and just growing that.

And how important are -- I know you guys haven't put out kind of a peak sales opportunity or anything there. But how important do you view these comorbidities to its leanest multibillion peak sales opportunity?

I think it's 1 bolstering the use case for hypertension itself. Again, as we go out and speak to physicians and ask what attributes matter to you, we see reflected back that complexity that they're dealing with. And so having data that speaks to not only blood pressure, only safety, but what's happening with the kidney, can I use this with a comorbid OSA patient, all of that takes us deeper into that resistant and eventually uncontrolled resistant hypertension population. So the penetration of lorendastat into the use for that uncontrolling resistant hypertension. But then I think it also builds into other categories, kind of the end of the journey. So CKD, heart failure, heart disease.

And could you discuss where the company is at from a financial standpoint, kind of cash runway and maybe the importance of a partnership to extend cash runway and where that kind of fits in to -- yes, your expectations of kind of gearing up to support the launch?

Q1 earnings call, we noted we have about $646 million in cash, cash equivalents and investments. That takes us into 2028. That includes ongoing clinical development, corporate needs that obviously includes the presumed commercial launch on successful FDA action. None of that is dependent upon any kind of partnering capital inflow. So that's an alternative that we continue to evaluate, but we're very comfortable with our cash situation right now and covers us into 2026.

Great. Thank you so much, Jon. I appreciate you being with us here today.

Thank you.