Mirum Pharmaceuticals, Inc. (MIRM) Earnings Call Transcript & Summary

Great. Thank you, everyone, for coming, and we certainly did save the best company for last. We have the pleasure of having Chris Peetz from Mirum Pharmaceuticals today. My name is [indiscernible]. I'm an Executive Director at Morgan Stanley Investment Banking division. I have a brief disclosure that I need to read before we get started. Research disclosure. For important disclosures, please see the Morgan Stanley research disclosure website at www.morganstanley.com/researchdisclosures. If you have any questions, please reach out to your Morgan Stanley sales representative. So with that, Chris, thank you very much for making the trek out here. We really appreciate you making the time. Really excited to have you here today.

Maybe before we jump in, can you tell us about Mirum story and how you first got involved and how you got to where you are today before we dive into some of your most recent developments?

Sure thing. Thanks for hosting us. It's great to be here. And for a quick snapshot and a little bit of history on Mirum, we are a commercial-stage rare disease company with a leading franchise in pediatric hepatology that has 3 commercial products now, recently completed an acquisition of 2 additional commercial programs to add to our existing commercial lead, LIVMARLI and Alagille syndrome and positions us for in a real position of strength for growing our commercial business with reinforcing that leadership position, started with LIVMARLI, now with Chenodal and Cholbam, a lot of overlap in prescribers and patient services, diagnosis of patients in these settings. So really a great dynamic for continuing to grow all 3 brands and a very rich set of data and regulatory that's coming up that are all quite interesting growth opportunities across the program. In the pediatric setting with LIVMARLI, having a PDUFA date for PFIC in December, biliary atresia Phase IIb study that reads out later this year. I'm sure we can touch on some of that, for volixibat in adult cholestatic indications, 2 interim analyses that will provide dose selection and transition into potentially pivotal portion of studies for PSC and PBC. And then for Chenodal, we have a Phase III study that reads out in Q4, label expansion opportunity and an ability to set us up to continue to grow that brand and have orphan exclusivity potential for the CTX indication. And what is behind all of this and what we've been able to build with Mirum is a team that has really shown its ability to make great advances for patients with these products in late-stage clinical, regulatory and commercial activities. We launched the company about 5 years ago around the LIVMARLI data set that we saw how transformative of an impact it can be for children with Alagille syndrome, brought that to market and have been able to bring a team of fantastic experts from the biopharma industry to bring some really important rare disease medicines to patients.

Great. Well, thank you for the summary. Maybe we can dive in on some of the recent updates, and congratulations on hiring Eric to be your CFO and getting him to come out of his brief retirement. Now also, congratulations on your recent purchase of the bile acid asset portfolio out of Travere. Now for those that might be some -- unfamiliar with the transaction, can you please provide an overview of these assets and how they are contributing to your pediatric hepatology franchise?

So the 2 products that we recently acquired, Chenodal and Cholbam are both bile acid replacement products. So very relevant in a number of different genetic disorders where the bile acid synthesis pathway is disrupted for one reason or another. And these provide exogenous bile acids to help restore balance to those pathways. And in the clinical effects seen can have a pretty transformative restoration of the bile acid pathways and prevent some pretty bad outcomes, frankly, in terms of what accumulates for some of the toxic byproducts of a disrupted bile acid synthesis pathway in these settings. Cholbam specifically is indicated for bile acid synthesis disorders and is effectively a standard of care for a number of these different rare genetic disorders where that synthesis pathway is disrupted. It's promoted primarily to pediatric hepatology community. And this is one of the ways that we actually got in conversation about bringing these programs into Mirum. It is diagnosed in large part with a common genetic cholestasis panel that's used to identify patients with PFIC and Alagille syndrome. So a lot that comes together in terms of synergy with the LIVMARLI business. And also the distribution for both Cholbam and Chenodal is through the same specialty pharmacy where we -- how we provide LIVMARLI to patients. There's a lot in terms of operating and financial synergy to bring these together. So Cholbam over the years has continued to grow as well as Chenodal at kind of a steady clip from adding new patients and just increasing demand over time. But there's a couple of really interesting opportunities to potentially accelerate that growth. And with Cholbam, there's emerging data on a specific bile acid synthesis disorder that to date has not had much data behind it called Smith-Lemli-Opitz syndrome, really great data set that is already showing kind of early uptake and excited to see how that plays out and continue to grow Cholbam. On Chenodal, and it's worth spending time talking a little bit about the regulatory dynamic and current use of that program. Chenodal is labeled for a gallstone indication. And while it's no longer prescribed for that indication, it has become standard of care for cerebrotendinous xanthomatosis, or CTX. This -- it's commercialized under a medical necessity designation from FDA, quite unique regulatory status. And we are taking over what Travere started and put a lot of thoughtful design work into the RESTORE Phase III study that can be an opportunity to get a formal indication for Chenodal and CTX. That's going to allow with an approval for active promotion. So everything that has grown with Chenodal over recent years, that's all basically through passive commercialization. And we think there's a lot of impact that [indiscernible] by being more active in identifying patients and bringing them into care earlier. CTX as an indication is generally diagnosed late. And you can prevent a lot of neurocognitive deficits that's irreversible with this disease if you can find those patients earlier. So excited about bringing that label expansion potential for Chenodal forward and growing the CTX market based on the RESTORE Phase III study reading out next quarter.

Yes. Great. Thank you. And maybe going back to what you mentioned earlier on the synergy. Can you perhaps maybe talk to top and bottom line synergies from your perspective that you expect with these products?

Yes, these fit so well with what we're doing for LIVMARLI. It positions us from an operating standpoint and financial contribution on really solid footing. So the way we look at even just Q4, the -- adding the contribution from the bile acid programs into business from an operating cash flow perspective, expect the business to be -- the company to be cash flow breakeven. So that kind of sustainable position with a strong balance sheet, a lot of opportunities to continue to invest in growth across all of our clinical and commercial programs. Adding these products just gives us real financial scale as we head into a lot of growth opportunities. Now the couple of points to kind of dive a little bit deeper on -- it's not just synergy but the ability to reinforce growth across these brands is what I'm really excited about. And by having that deepened relationship with the prescribing audience and having Mirum be the name that's helping support diagnosis of their patients, offering 3 of the quite important standard of care medications that are used to treat these different genetic disorders, it really puts Mirum in a position to support growth across all 3 brands.

Got it. Can you comment on the -- perhaps the growth trajectory? You mentioned that it's been growing steadily under Travere's ownership. Now with your perhaps active efforts on commercializing, can you provide some perspectives on kind of what you expect the growth trajectory to be with these 2 assets?

Yes. The first comment I'd make is this is -- all of this financial performance is on top of what we expect for LIVMARLI. So LIVMARLI is in a really interesting position where it's -- this year, we expect it to grow 50% year-over-year just in Alagille syndrome penetration in the U.S., international markets launching on top of that, the label expansion coming up, biliary atresia data set coming up. So there's a lot of really dynamic rapid growth still ahead of us for LIVMARLI. And that's just further reinforced and accelerated with these bile acid programs. We do expect them to grow really as they have historically. Travere did a great job with these programs, setting them up and helping to establish their position as standard of care in a number of these indications. We're excited about with the increased focus, these growth opportunities and continuing forward that steady growth that you see historically in these programs, and we expect that to continue into the future.

Great. Now you mentioned briefly earlier around the Phase III RESTORE trial with Chenodal and CTX. Now can you perhaps talk a little bit about what that expansion opportunity -- label expansion opportunity would actually do for you from a commercial standpoint? And also, any potential for orphan exclusivity?

Yes. So CTX as an indication, it has a gradual accumulation of impacts from the disease. That results in a lot of these diagnoses coming quite late and in some cases, too late to really have a full impact on some of the irreversible effects of the disease. So the opportunity is not necessarily in further penetration into identified patients. It's about expanding diagnosis, right? There's -- our estimate is that only about 10% of CTX cases are diagnosed. So a lot of headroom in bringing more patients to medication sooner and preventing some of the progression that can be seen in CTX without treatment. Chenodal can have a transformative impact for these patients, in particular, if you treat early and prevent the kind of accumulation of impacts over time. So that's the opportunity is trying to move that 10%. Really any meaningful increment would be a large growth driver for Chenodal as a brand. I'm sorry -- I'll add one other thing. You asked about orphan exclusivity. And the Chenodal does have orphan designation. So we would expect with that label expansion that we would have the 7 years of formal orphan exclusivity from the approval date.

Got it. Maybe now shifting gears a little bit to LIVMARLI now. You've had another great quarter with LIVMARLI. Now can you talk a little bit about how you are achieving that growth trajectory, whether it is patient awareness, commercial efforts or sales efforts. What's driving that growth -- upward growth trajectory?

So it's really driven by a number of different aspects of LIVMARLI, its clinical profile and how we're working through bringing patients in the prevalent pool to treatment and then also new diagnosis. So there's a few things to break down in there. First one, earlier this year, we had a label expansion for LIVMARLI and Alagille syndrome going down to now labeled for 3 months and older for treatment of cholestatic pruritus, unique positioning as -- that's the only product that's approved for that age range where a lot of the diagnoses are happening. So important to be able to offer a treatment option for newly diagnosed patients that have the cholestatic pruritus and burden of disease. And we've seen that come through in new patient starts. So since that label expansion, we have seen an uptick in younger patients initiating therapy. We also still continue to see older patients start therapy. And there's a dynamic in Alagille syndrome where a lot of patients before LIVMARLI's approval, the older patients have gone 10, 15 or more years normalizing their day-to-day. And in our discussions with prescribers and with families, we've seen an evolution of them being able to understand all the things that they've done to normalize and cope with a really high burden of disease and continue to see more of those patients from the prevalent population come to LIVMARLI and have -- from what we hear just this tremendous treatment response from initiating. So that's what's driving that continued quarter-over-quarter growth for LIVMARLI and Alagille syndrome. We see it continuing for the quarters ahead as well. There is still a lot more to go and building into the full Alagille syndrome opportunity.

Great. Maybe just to double-click on this a bit more on your genetic testing kits and Mirum Access Plus and how that's helping -- further helping with early identification, detection and also adherence?

So for diagnosis and early detection, I mean, the genetic testing kit is really seen by pediatric hepatologists in the U.S. as one of their critical tools. And so to be able to provide that directly from Mirum is -- that's an exciting add into what our offering is for the customer base. That's provided free of charge to pediatric hepatologists in the U.S., so used as kind of a cornerstone for how they're confirming diagnosis of their patients. For Alagille syndrome, we see it as likely pretty well diagnosed actually. So the genetic kit is typically for confirmation of a suspected Alagille syndrome case is how it's most commonly used in that setting, a lot of other settings where it's more of exploratory diagnosis to understand what liver disease might be at play. So bringing that under the Mirum label really just about reinforcing our leadership position and helping to -- physicians to care for their patients. Mirum Access Plus as a program has been quite differentiated for us and has helped with compliance and persistence. A lot of that, though, was really LIVMARLI and the clinical data and the real tremendous treatment response on pruritus that we've seen across the clinical program. And what we see from the clinical data is patients feel better and are doing better on drug. And so that paired with a support system for Mirum Access Plus that helps make it easy to communicate through the refill process, makes it easy for any questions that the prescriber might have during a prior authorization process all help support ease of access to LIVMARLI for patients.

Got it. Maybe before we switch gears to talk a little bit around your developing pipeline, which is, I think, important for those that are listening [indiscernible] understanding your growth profile, can you talk a little bit around the competitive dynamic you see in Alagille syndrome?

So in Alagille syndrome, there's competitor in [indiscernible], which is another IBAT inhibitor indicated for pruritus in PFIC and most recently had a label expansion into Alagille syndrome. The LIVMARLI label has a broader age eligibility. And that paired with the familiarity of prescribing LIVMARLI and the ease of access with Mirum Access Plus, since that label expansion, we've not really seen an impact to our business in terms of new patient starts and persistence and compliance. So I feel that the Alagille syndrome business in the U.S. continues to be in really great shape with a lot of growth ahead of it. We're watching the international situation, which is really interesting right now as well, particularly in Europe where we're approved for cholestatic pruritus in Alagille syndrome as well, working through country by country and the reimbursement processes. And the -- what we've seen shared for the [indiscernible] process is that there is a kind of a negative opinion on the orphan designation. So it leaves us in a position where LIVMARLI is the only approved product for pruritus and Alagille syndrome in Europe and seeing continued demand growth across a number of countries in Europe.

Great. Now maybe talking a little bit about PFIC, can you perhaps provide us with an overview of what we can expect later this year?

So for PFIC, our submission that's in review right now with FDA and EMA is based on the Phase III MARCH-PFIC study. And that looked at 93 patients across a very broad range of genetic profile. And PFIC is a really pretty simplistic umbrella term for a number of quite different genetic disorders that involve disruptions in bile acid transporters and related transporters. Our study is -- has had the broadest and largest set of different genetic profiles in a randomized data set and saw really quite striking response rates on pruritus and serum bile acids. We also saw changes in bilirubin versus placebo over time, changes in growth compared to placebo. So really strong clinical data set that is under review. PDUFA date for FDA is December 13. So working towards that date for the potential label expansion in the U.S. And in Europe, similarly going through review with EMA and expecting a decision out of the EMA process early next year. So -- but we're hoping for and quite optimistic about the process is being able to get some of that great data from the MARCH-PFIC study worked into our label and be able to roll that out for PFIC patients around the globe.

Great. I have to ask this, which is what can you share about your discussions with the FDA ahead of your PDUFA?

Yes, not much that we can share, of course, or comment in detail. We're going through the review and our -- what we see the process heading towards that December 13 PDUFA date.

Okay. I had to try. Now just another minute on LIVMARLI. Can you perhaps provide an update on where the Phase IIb EMBARK study is in biliary atresia?

So quite excited about the upcoming data readout from EMBARK. EMBARK is a 6-month placebo-controlled study of LIVMARLI in patients in a post-Kasai setting. So in biliary atresia, patients are -- these infants are quite sick and need an emergency Kasai procedure to establish bile flow that is otherwise disrupted as the nature of the disease. After the Kasai procedure, there's still persistent cholestasis, and that's the treatment opportunity to prevent the bile acid overload from causing continued damage to the liver and what is in the setting without treatment, quite rapid progression to transplant with many of these patients, these children needing a liver transplant by the time they're 2 years old. So EMBARK, which completed enrollment in the spring this year, heading towards data readout late this year based on a 6-month primary endpoint, focusing on bilirubin. So bilirubin in the setting of BA post-Kasai is really seen as one of the key prognostic markers for liver events and transplant risk. So we're looking to see not only just mean changes in bilirubin of the LIVMARLI-treated patients versus placebo, but also importantly, to go a level deeper than that and look at how the LIVMARLI-treated patients do versus some of the established risk category. So there's risk thresholds on bilirubin 6 and higher and 2 and higher that are quite prognostic for the course of disease post-Kasai. We want to see the LIVMARLI patients stay in those lower categories compared to placebo. And at 6 months, patients will roll on to open-label treatment as well, and we'll look at safety and progression of these patients over time on open-label LIVMARLI as well.

Maybe now let's talk a little bit around PSC and PBC and around the milestones that are expected heading into the latter part of this year.

So volixibat is currently being evaluated in 2 adaptive Phase IIb studies, the VISTAS study in PSC and the VANTAGE study in PBC. Both of these are randomized placebo-controlled studies that have a dose selection interim analysis that's coming up. So that's the data event that we're expecting around year-end. And for each of them, that will select a dose to move into what we expect to be the confirmatory and potentially pivotal portion of the study. So these -- both studies are evaluating pruritus as the primary outcome. And if pruritus is an outcome, it's so relevant to the day-to-day for these patients and can be -- similar to the pediatric setting, can be an outcome used for the basis of an NDA submission. And that's the strategy here is to use each of these studies to support a filing for volixibat in PSC and PBC.

What's the rough market opportunity like in both PSC and PBC?

These are the -- volixibat in these indications, each one is a really high impact, high potential opportunity for us. PSC, in particular, where the competitive set is wide open, there's no approved therapies in this setting, there's a high unmet need, a lot of procedural work to care for these patients and to bring a new therapy forward would be a really meaningful advance. In the U.S., it's about 30,000 patients. And the majority of them have pruritus and are actively managing it as part of their disease. So really high impact to be had in PSC. In PBC, similarly, there's a really tremendous unmet need for treating symptoms and pruritus and particularly in first-line. And so I know there's a lot of current discussion about emerging therapies in the second-line setting, some really nice data that's come out of the [indiscernible] program, looking at second-line PBC treatment. But there's not been really anything in the first-line setting where even if the biochemical parameters are essentially controlled, the symptomatic disease isn't necessarily controlled. And so we see an opportunity in this first-line PBC patients with pruritus with the associated fatigue and quality of life impact that LIVMARLI can be a really important therapy there and then also in some of the second-line patients that maybe don't have their symptoms controlled from the emerging or currently available therapies.

Okay. And maybe last question. You've been able to get approval and then you're able to do this very elegant business development deal. How do you think about building your franchise going forward in terms of continuing to be smart around business development, also execution of clinical development candidates? What's your vision? Where do you see Mirum being in a few years?

Yes. What's at the core of kind of everything we've done today and what I see as part of how we continue to grow the business going forward is finding these high-impact medicines or potential medicines in development that the connection between the product and the biology and the patient need is all clear and that fit with this great team that we've brought together at Mirum. So a lot of rare disease expertise and commercializing and developing kind of that late-stage and regulatory process in rare disease that the Mirum team has done a great job with. And I want to -- really excited about finding more rare pediatric products that can fit well with what this team is really great at doing, bringing much needed medicines to patients.

Great. You're a rare -- commercial rare disease company that's for biotech. And we really look forward to seeing all the progress that you make in getting these products through the clinic and also your business development efforts. Thank you very much for your time today.

Yes. Thanks for the conversation. I'm really excited about everything that's ahead of us in terms of data from our programs and growth out of the commercial business. So stay tuned for more updates. Thank you.