Travere Therapeutics, Inc. (TVTX) Earnings Call Transcript & Summary

Hi, everyone. Welcome. It's great to see everyone in person. This is the fourth day of the JPMorgan Healthcare Conference. My name is Luka Kachukhashvili. I'm an associate here in the Healthcare Investment Banking team. It's my absolute pleasure to introduce Travere Therapeutics. Joining us today will be Eric Dube, the CEO of Travere. With that, I hand it over to you.

Luka, thank you, and JPMorgan for hosting us. I couldn't be more excited and grateful to be able to share the opportunity to talk about Travere. It is perhaps the most important year for us in our 8-year history, but also for the space within rare kidney disease that really were at the forefront of what I believe is a renaissance in being able to bring hope and new therapies for patients living with rare kidney disease. In my presentation, I will be sharing some forward-looking statements. So I'd encourage you to go to look at our SEC filings for additional language there. But I want to start with a real focus that we have at Travere. We are based in San Diego, and we are exclusively focused on rare disease. Our mission really is to be able to change the lives of families that are affected by rare disease and through the development and delivery of medicines. And that's because it's personal for us. I am a rare cancer survivor, and many of my colleagues joined this company because of the mission that we have and the very unique culture that we have in being able to deliver not just medicines but overall focus on improving the lives of rare families. And we have lived experience across the organization, including at the executive level where we have not just myself as a rare survivor, we have a rare kidney patient. We have a rare caregiver, and we have a provider who has been focusing on providing medical care for rare kidney patients. So this is very real for us in being able to address a sense of urgency and a holistic view to be able to deliver and commercialize medicines that will be transformative in this space. This is a snapshot of who we are at Travere, first and foremost, we are a company that is very much focused on being a patient and community-centric leader within rare disease. We have a commercial infrastructure that we've had in place for about 8 years and has successfully been able to identify and maintain therapy for patients with rare and ultra-rare kidney and hepatic diseases. And we have a very strong financial position to be able to move our pipeline forward and ultimately come 5 weeks from now, the first major launch for us with the launch of sparsentan. This is our management team. We come with a depth of experience within rare disease and within the bio and pharma arena. I will call out -- I worked about 20 years at a large pharma launching a number of medicines that really have been important in oncology, rare disease as well as in chronic disease, and I'll call out 2 of our leaders in particular, who joined very specifically for the promise of sparsentan and Travere. That's Peter Heerma, our Chief Commercial Officer, who has spent the majority of his career in nephrology, launching some very important medicines and also working on the development of medicines that you may know well in the pipeline of other companies. And then Dr. Jula Inrig, who is a nephrologist who worked over the last 10 years, both at IQVIA, as the lead nephrologist working on a number of -- in most of the medicines in development in this arena, but also on the kidney health initiative, which has been instrumental at creating a regulatory pathway for the use of proteinuria and other biomarkers to really accelerate the development within this space. Now this is our pipeline. We will focus quite a bit of our time today on sparsentan. We have 2 Phase III programs that we'll be reading out later this year. We have CDCA which is a commercially available medicine but is not promoted, but we are developing and is in Phase III for an ultra-rare condition, CTX. And we will have those data and the ability to submit for that indication later this year. And then we have pegtibatinase, which is a pegylated human enzyme replacement therapy for the treatment of classical homocystinuria, we've reported out proof-of-concept data about a year ago. We'll provide further data from our Phase II program in the middle of this year, and then we'll look to move that asset into Phase III in the second half of this year. I've touched on a number of the milestones that we have in front of us. To characterize this as an important and exciting year is probably an understatement. It will start in about 5 weeks with our expected approval of sparsentan. Our PDUFA date for the treatment of IgAN is on February 17, and we are ready for a phenomenal launch there. Then moving into quarter 2, we have the top line readout of our Phase III DUPLEX trial in FSGS. That will serve as the basis for us to submit a supplemental NDA to the FDA for approval of that indication. And in many ways, we believe that the DUPLEX trial is a landmark trial and really one of the first ever within this very difficult to study and treat disease. In the middle of the year, we expect to have approval from EMA for sparsentan in the treatment of IgA nephropathy. And then moving on into the second half of the year, we expect to submit an sNDA for FDA, a variation for the -- for sparsentan in FSGS. And then also, we will have the top line data readout and the completion of our PROTECT trial, which is the Phase III confirmatory trial in IgA nephropathy. So a very busy year, but one that I couldn't be more confident in our ability to execute and deliver on all of those for sparsentan. Turning our attention to pegtibatinase. There really are 2 major events this year. The first is that we will provide additional data from the COMPOSE study. That's our Phase II, looking at a higher dose cohort of that to be able to see whether we can get even further efficacy than we've already demonstrated. And then by the end of this year, we will look to start our Phase III program in HCU. And then finally, we're providing a bit more visibility in our CTX program. Again, we've been behind the scenes working on that trial. That trial will complete by the end of this year, and we'll look very quickly next year to be able to submit for that indication. Turning our attention to sparsentan. This is a dual endothelin and angiotensin receptor blocker. It's been in development for these rare glomerular diseases. But I want to start with the patients. Now these are 2 indications, IgA nephropathy and FSGS or focal segmental glomerulosclerosis that are oftentimes the most rapidly progressing and difficult-to-treat glomerular diseases. IgA nephropathy is perhaps the most common of the primary glomerular diseases. And for these patients, they oftentimes are diagnosed in early adulthood and otherwise are young, healthy and of working age. And the diagnosis of IgA nephropathy comes oftentimes as a surprise to these patients because they are often told that this is a progressive disease that really is very little other than the treatment with ACE inhibitors or ARBs. And for the patients that we are focusing on those patients with proteinuria above 1 gram per gram. They oftentimes will have a median progression to end-stage kidney disease, transplantation or dialysis within about 10 years. So this is within the prime of their life, they're then told to be prepared for dialysis. And as I'm sure many of you know, oftentimes the mortality rate for patients that are on dialysis are sometimes higher than some of the common cancers. Turning our attention to FSGS. This is an even more rapidly progressing disease. It is characterized oftentimes by nephrotic range proteinuria, these are patients that have difficulty in having any type of response to other therapies. They will typically be placed on ACEs or ARBs, sometimes steroids, but it's very difficult to be able to slow the progression of this disease. Oftentimes between 30% to 60% of these patients will progress to dialysis and end-stage renal disease within a matter of years. And when we talk to nephrologists very consistently, they rate FSGS and IgA nephropathy as 2 of the most challenging diseases to treat and the 2 areas of high unmet need. One of the other things that we hear very consistently from nephrologists is the common component of these diseases is not just the progressive nature, but the way that they're treated, the nephrologist will be looking at proteinuria. These conditions, while different in etiology of their renal dysfunction, but are very common in the high proteinuria and the progressive proteinuria that they have. And I'd like to spend a little bit of time about how that occurs within IgA nephropathy and why sparsentan is so well positioned to be able to address this injury that occurs and the disease process that occurs within the kidney. Now we know very well the etiology of renal damage for patients with IgA nephropathy or IgAN, patients will typically have an infection, a respiratory infection, upper respiratory infection that will then activate and glycosylate IgA. Those glycosylated IgA complexes then become deposited into the kidneys as their blood is being filtered, that deposition within the kidneys is not just injurious alone, but actually starts a cascade of overactivation of both angiotensin and endothelin. And this is perhaps why about 90% of patients that are diagnosed with IgA nephropathy in the U.S. are placed on an ACE inhibitor or an ARB. But unfortunately, it's not enough. We know that most patients with -- that are treated even with an ACE or an ARB continue to progress in their proteinuria. And that's because there is crosstalk between angiotensin and endothelin. And so if you focus on only one of those, you still have the overactivation of endothelin that for -- if you don't have full occupancy of the RAS system, you still will have some kind of up-ramping of angiotensin as well. And so this is where we believe sparsentan as a dual endothelin, angiotensin blocker is uniquely positioned to be able to address this. And what you can see, once the patients do have this over activation, they do have these immune complexes that are in the kidney, you see that it actually creates a further issue where there is a compromise in the integrity of the glomeruli the podocyte, which is the main filtering sale becomes compromised and there's often apoptosis. That is what leads to proteinuria and the ability for the glomeruli to filter the blood and maintain the protein in the blood and then that leads to the scarring or glomerulosclerosis that is seen oftentimes in biopsy as well as inflammation and fibrosis that occurs through the mesangial cells and the glycocalyx for these patients, which is often what renal biopsies are really being assessed for. And so if you're able to block both angiotensin and endothelin like sparsentan does, you're able to then slow and improve the proteinuria, but also allow the kidney structurally to be able to heal. That is essentially what we're aiming to do, not just short term with proteinuria, but longer term, in being able to slow the progression of this disease and ultimately prevent these patients from going into renal failure. We are studying sparsentan in 3 clinical trials. We've completed the bottom trial here, the Phase II DUET study in FSGS, but these patients, many of them are still continuing out to 7 years in an open-label extension. And then we have 2 Phase III programs, the DUPLEX study in FSGS, as I mentioned, will be completed next quarter, and the Phase III PROTECT study in IgA nephropathy the double blind will complete in the fourth quarter of this year. For both of those Phase IIIs, we do have open-label extension to be able to assess longer-term benefit and risk for these populations, and I'll get it more into that in the next slide. This is the trial design for the PROTECT trial. We are perhaps unique amongst really anything else in development where we have chosen to go -- to compare sparsentan to active control. So all patients are randomized to either sparsentan or irbesartan. The other unique aspect about this trial design and the rigor that we have with our Phase III is that all patients before randomization are screened in a run-in for 12 weeks to ensure that their RAS blockade is optimized before randomization. We know all too well that in the real world, even under the care of nephrologists, many patients are not optimally dosed on their ACE or their ARB. We have 2 major time points in this trial. The first is to support accelerated approval, and that is at 36 weeks in the assessment of proteinuria change or UP/C from baseline to week 36, and then all patients are followed out to 2 years to be able to assess a longer-term measure of kidney function in the 2-year eGFR slope. And again, we'll achieve that endpoint in the fourth quarter of this year. The other thing I'll point out on this slide is that we did announce before the JPMorgan conference that we are initiating 2 studies in IgA nephropathy in the combination of sparsentan and SGLT2s. These are smaller studies, but very important in answering one of the main questions that physicians have is how can you combine sparsentan and SGLT2s. We do have a drug-drug interaction study that we completed showing that they can be safely combined. But what we want to do in the open label extension is to show what the incremental benefit and safety profile is of adding SGLT2 to sparsentan. And then we have a separate study looking at what the benefit of adding sparsentan is to patients that are on stable SGLT2. So those data we should expect to have next year. And from the IgA nephropathy study at our 36-week endpoint, these are the results from the assessment of UP/C change. They're one of the most robust and greatest magnitude of proteinuria reduction of nearly 50% compared to 15% on active control irbesartan. That 15%, I think, really reflects again that many patients in the real world are underdosed on their ACE or ARB. And this, again, we designed the trials to be able to show that if you can have a reduction of at least 30% at 36 weeks, that should translate into a robust treatment effect at 2 years on eGFR. Turning our attention to the Phase III DUPLEX study, you'll see a very similar trial design, although there are some important differences here. Patients with FSGS are treated perhaps a bit differently. ACEs and ARBs are still the predominant method to treat these patients, but they are treated with a whole host of other therapies. And so we did have a washout period before randomization and also the target dose is higher in FSGS compared to our PROTECT study. The measure of proteinuria is slightly different and perhaps a more rigorous measure that reflects some of the work that was done in assessing the relationship between proteinuria and eGFR, we looked at a measure of partial remission and then a similar measure of eGFR slope at 2 years. These are the results of the 36-week time point where we see a robust and significant improvement in 42% of patients on sparsentan were able to achieve partial remission. And as if we expect what we did see in our longer-term follow-up in Phase II, we would expect these rates to continue to improve. These are the results from the Phase II. This is at 8 weeks also comparing sparsentan to irbesartan, where you see a similarly robust improvement in proteinuria. And for those patients in our Phase II open-label extension who were followed longer, and this is out to 4 years, we looked at eGFR. This is open label. So take that -- the context there. But against a backdrop of natural history of one of the most rapidly progressing glomerular diseases, typically you will see in an FSGS patient that they will lose between 6 and 10 milliliters per minute per year of renal function. We see that patients that are on sparsentan were able to perhaps slow the progression of their kidney function loss. And it's about 4 milliliters per minute per year. So I think it gives us further confidence that relationship between proteinuria reduction early and being able to have a longer-term benefit seems to be here in this. And of course, we'll be able to answer that question next quarter. This is just a summary looking at the consistent and robust reduction across those 3 trials when you compare sparsentan to active control. And again, a summary here of the very busy regulatory timeline that we have starting with the potential approval in 5 weeks' time, and then Europe approval, and then we will look to complete those trials and quickly submit for full approval for FSGS. Looking at the addressable population, these, again, as I mentioned, are some of larger prevalence of rare kidney diseases and rare diseases overall. FSGS, there are about 30,000 to 60,000 patients in the U.S. We've done a lot of work looking at what is the addressable population at the time of launch, looking at things like who have the -- who has a biopsy proven disease, who's under the care regularly of a nephrologist, who is not so far along that they're close to or in end-stage renal disease and that really is what gets us to 15,000 to 30,000 patients with FSGS. And it's about double that for IgA nephropathy. So these are sizable numbers of patients for us to be able to improve their lives, and that's where we want to make sure that we can quickly reach them with sparsentan. And we believe that sparsentan and Travere are uniquely positioned to become the new foundational therapy to be able to replace the role that ACEs and ARBs play within this disease. We don't believe that anything in development that we've seen thus far has the ability to replace the role of ACEs and ARBs in that foundational therapy as a once-daily oral pill dual mechanism, very simple to use with a predictable safety and efficacy profile. We know that this space is evolving and could evolve quite quickly within the future. But we have a 2-year lead time before anything else is going to be approved within this space. And we believe having launched a number of medicines within my career, a 2-year lead time from a competitive standpoint was such a powerful clinical profile as sparsentan really gives us a strong position upon which to build this medicine. And we have, as I mentioned previously, a commercial infrastructure already. Part of that has been within rare nephrology in cystinuria where we've had relationships with a number -- with several thousand nephrologists within the U.S. Late last year, we expanded our commercial infrastructure to prepare for the sparsentan launch. And I'm very pleased that we now have a full complement of 80 account managers that will cover 6,000 nephrologists within the U.S. In our estimates and our targeting, that covers about 85% of IgAN patients within the U.S. What's important to point out here and perhaps unique from some other rare diseases is that the majority of patients are actually under the care of community physicians under the care of community nephrologists. And so it's important for us to have the capabilities and the infrastructure to not only be efficient but to be -- also to be able to reach where these patients are. Because we know that within nephrology, there typically are not the type of referral patterns into secondary or tertiary care centers. So we want to make sure that we can go where the patients are. And we will be prepared from day 1 of approval to be able to reach out to these clinicians with sparsentan. And finally, and perhaps most importantly, when you think about launch is, are the patients going to be able to access it, can they afford it? And we've been working for a number of years to establish a robust evidence base for the value proposition and the health outcomes and burden of illness of IgAN, the value of sparsentan. We have a team that's already in place and in the field to be able to engage with payers. We'll be ready to be able to do this. And I've been very pleased with the feedback we've received thus far. Payers really in the U.S. understand the burden of this disease, the cost of this disease, the inevitability for many of these patients to be on renal replacement therapy and ultimately, the promise that sparsentan can bring. So we are very focused on getting access because with access allows us to have the uptake and allows us to establish sparsentan as the new foundational therapy. So that in 2, 3, 4 years from now, when other classes of medicines come for patients that may need additional help, they can add those complementary mechanisms on top of sparsentan, if needed. On that note, I'd like to talk about 2 maybe specific things on the potential launch as it is so near. The first is we've done a lot of market research with nephrologists and the most anticipated pipeline medicine in development as this is -- really is a renaissance within rare kidney disease. Sparsentan consistently is seen as the most promising and anticipated medicine there. The #1 measure that I look at oftentimes when I've launched medicines in the past is intent to prescribe. Do the clinicians that intend to use this, do they actually want to. And we've been very pleased to see that consistently over the last year that 90% of nephrologists in the U.S. expect to use sparsentan in the first year. I have never seen an intent to prescribe as high as that. So we believe that there is a recognition of the unmet need in this population, that the understanding and the role of sparsentan in the clinical profile certainly is there. And the second thing I'd like to mention is that we have announced that FDA would like for us to add a component to the planned REMS. Any endothelin receptor antagonist will need to have a REMS for pregnancy due to the fetal toxicity risk. But FDA did ask us to include also liver monitoring because there have been some endothelin antagonists that had been associated with liver damage. We have not seen any cases of liver damage in the history of clinical development with sparsentan. But the FDA has indicated that because this is being approved through accelerated approval and the safety data package is evolving and the full benefit within this population has not yet been proven that they would like for us to have educate physicians on this risk and be able to monitor liver. We'll be able to provide further details on the design of that REMS upon approval in 5 weeks' time. But we are well prepared to be able to address the needs of physicians, make it efficient and ensure that we are educating clinicians about this potential risk. But with all of that, it does not deter us from the vision, and I don't believe that there is going to be a substantial impact on the short-term or the long-term impact of sparsentan's uptake. And in Europe, we have a very established renal partner, CSL Vifor, who will have commercialization rights there. They are well poised with their experience to be able to launch this upon approval later this year. Turning our attention quickly to pegtibatinase. This is, again, a pegylated human enzyme replacement therapy for classical homocystinuria. This is a recessive genetic disease where patients have a defect in their CBS gene. The CBS gene metabolizes total homocysteine and methionine and is associated with an accumulation of toxic accumulation of homocysteine in the blood and tissues over time that leads to a dislocation of lens oftentimes in childhood, leading to seeing disorders as well as perhaps most concerting thrombosis. About 25% of these patients have a thrombotic event by the time they're 16 and 50% before they reach the age of 30. So a very serious underrecognized disease. And unfortunately, even though this is on the panel for most newborn screening, about 50% of newborns go undetected with this disease. So not only do we have the opportunity to innovate with regard to therapies, but really invest in better education, better screening for these children so that they can have as near normal life as possible. Pegtibatinase, we believe, will be disease-modifying and be able to be first in class. It is designed to be able to replace what would be the native CBS enzyme. We have breakthrough therapy designation that was -- we received last year. We have rare disease designation. We have orphan designation, and we have fast track. And this is the design of our Phase I/II COMPOSE study. We announced results from Cohort 5 about a year ago, and we have completed enrollment in Cohort 6. We'll be able to provide those data updates in the middle of this year. Turning our attention to what we provided with regard to Cohort 5, you can see the dose response in the upper graphs, I'll draw your attention to the lower left-hand graph, which shows the change from baseline in total homocysteine levels. There's very little known about this disease. We have a natural history study to help better characterize and understand this disease. But there is a literature and there are treatment guidelines. Those treatment guidelines recommend that patients get their serum homocysteine levels below 100 micromoles. At the dose studied in Cohort 5, we were able to get all patients on pegtibatinase below 100 micromolar within 2 weeks and keep them there for the 12 weeks of the study duration. We're continuing to follow these patients, so we'll be able to have more information on the longer-term safety and tolerability. And we, again, are studying a higher dose to see whether we can get these patients even further below as close to normal as possible. When we talk to these patients, it's not necessarily that they are only afraid about thrombosis or cognitive or psychiatric disorders or losing their sight. They want to eat a normal diet. These patients right now are treated most often with a very, very strict diet of no to little protein. I and many of my colleagues who are working on this program, tried that diet, I couldn't last 3 days. And so when we say we can just manage this with diet, it is a life that many of these patients are really eager to improve. And that's why we're looking at higher dose to be able to see how we might be able to help them not only stave off some of the clinical outcomes but actually allow them to spend time with their family and friends. If you think about what are some of the most meaningful interactions you have with others, it's social with family, with friends, over food. And that's what we want to be able to provide for these kids. Closing out with our finances. We continue to have a strong set of revenues that come from our established commercial portfolio. We announced that last year, we had $201 million in net revenues from the U.S. in our commercial business, and we ended last year with $450 million in cash. That cash position allows us a runway well into 2024. And when you think about the year that I just walked through this year with 2 Phase III programs that -- 3 Phase III programs that are continuing and will finish this year, the initiation of a Phase III, the start of 2 additional studies of sparsentan and SGLT2s and most importantly, to ensure that we have a strong launch to establish sparsentan in the next 2 years as the new foundational therapy, we have the cash that we need to be able to execute, and we have the organization that year in and year out has executed exquisitely well. So we're in a good position to be able to do that. I'll just end with, again, the highlights from what is an incredibly exciting year. But most importantly, this is a year that we believe is going to open up greater hope for a rare kidney disease community that has been waiting for decades for something that's going to transform their lives. I'm proud to be helping to transform, but most importantly, to be able to create the pathway for many others to come and bring other therapies for these patients. So I thank you, and I'm happy to take your questions.

Thank you, Eric, for the fascinating presentation. [Operator Instructions] I can get it started. So you've spoken about sparsentan as the new treatment standard. How do you perceive a physician preference for sparsentan as a foundational care therapy?

Yes. Well, I'll reference back to the intent to prescribe because I think it gives a real view of what are physicians going to do next month when they have a new treatment choice. And I think it's important for us to ground ourselves and what are they going to be thinking about now. Typically, if I were a nephrologist and I had an IgA nephropathy patient, there are limited choices that I have if they are progressive. You can continue them on ACE and ARB as a failure. And essentially, it's going to reflect the story that we hear from many patients that we speak to, which is prepare your life for dialysis. That's really not an ideal option that physicians or patients want. You can give them a round of steroids, but we know that the treatment guidelines say to minimize steroid use and patients and nephrologists really want to avoid that. In fact, the #2 attribute that nephrologists are looking for in an IgAN treatment is steroid sparing and not immunosuppressive. So really, that leads us to sparsentan and SGLT2s. We don't see SGLT2s as a competitor. In fact, we believe that they will be well co-positioned sparsentan for a robust reduction in proteinuria, SGLT2s, as we've now seen from DAPA-CKD and EMPA-CKD as renal protective in the long term. So we will be looking to be able to provide evidence on that combination. And it's no surprise when we do market research with nephrologists that sparsentan and SGLT2s is the combination that they expect to be most common in the future. So we will look to be able to provide further information. As we look for their field in 2-plus years, there may be other treatment options, other classes. But essentially, as we believe and what we hear from nephrologists is you want to have a very solid foundation of a simple therapy that is effective and safe such as sparsentan and then perhaps a personalized approach to be able to add on if patients need it or if they progress. And that's really how we see, but perhaps more importantly, how nephrologists see the treatment paradigm evolving over time.

And kind of to follow up on that. I was wondering if there's any lighter details you can shed on the review process with the FDA. Where do you -- where does the company stand with sparsentan there? And any additional details?

Sure. So we are in very active discussions with the FDA, both on the label as well as details on the REMS for liver monitoring. We're exactly where we would hope to be 5 weeks out from approval. And so while I can't get into any of the details of those discussions, we're very much confident that we will have a successful approval in 5 weeks' time.

Yes, we can switch gears a little bit. I was wondering if you could speak a little bit more about the business side of things. I was wondering how do you view your legacy commercial products versus your ongoing R&D efforts. Is there a specific prioritization of the business you'd like to convey here?