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

All right. Hello, everyone. My name is Prakhar Agrawal. I'm a biotech analyst at Cantor. Welcome to day 2 of the Cantor's Global Healthcare Conference. For the next session, we are very excited to host the team of Travere Therapeutics. Representing Travere, we have Eric Dube, President and CEO; and Peter Heerma, Chief Commercial Officer. Gentlemen, thank you for coming.

Thanks for hosting us.

My pleasure.

So obviously, a lot going on at Travere right now. We'll go into the specifics. But maybe just to level set expectations, why don't you start with an overview of the key priorities right now for the company?

Sure. So this is indeed an exciting year for Travere and the role that we look to play within the rare kidney and broader rare disease space. Our #1 priority for this year is to continue the success of the launch of FILSPARI in IgA nephropathy. And we've been very pleased with the performance for the first half of the year. And we've got some very exciting updates to continue that success in the back half of this year, including the recent modification of the liver monitoring REMS and the removal of the pregnancy testing REMS, which makes it that much simpler for patients to access. The second priority is the ongoing work with FDA for the potential approval in FSGS. This would be a transformational approval for that community that's been waiting far too long and has nothing approved for them. In the background, we have continued the work on our pegtibatinase program in classical homocystinuria or HCU. That progress has gone according to plan, and we're on track to reinitiate enrollment in our Phase III next year. And yesterday, we presented at the Inborn Errors of Metabolism Conference in Japan, the data at 1 year from our Phase I/II that shows a long duration of effect for those results for patients in the open-label extension. So giving further excitement to that community for something that really addresses the direct cause of the disease.

Okay. Maybe let's start with the FSGS side of things for FILSPARI. Just start with a brief overview of the PARASOL initiative and the FDA's involvement throughout the process?

Sure. For background, PARASOL was formed in the fall of 2023. It's a public-private partnership from thought leaders within the FSGS space, the patient advocacy organizations as well as global regulators, including the FDA. We have been able to observe some of the workshops that were done, but we are not directly involved within that PARASOL work. It was formed really in the intent much like the kidney health initiative to use evidence in that disease to best identify and define endpoints for clinical trial development within that space. And whereas there was a limited literature that helped us to define both the potential for partial remission and eGFR for approval. Certainly, with the readout of our Phase III DUPLEX trial, we showed that we were able to show a profound reduction in proteinuria that did not translate into a statistically significant effect in eGFR. So PARASOL really started with that premise and said, what is it about this disease that we need to better understand to identify endpoints. And they really came away with 3 conclusions. Those conclusions were based on an analysis of 26 different real-world registries of patients with FSGS with long-term follow-up. The first conclusion was that eGFR, of course, is important to any kidney disease, but it's not a feasible endpoint in a trial design for FSGS because it is highly variable. And it's highly variable for 2 reasons. The first is that FSGS is a heterogeneous disease. The second is that patients' individual eGFR can vary significantly over time, contributing to a lot of variability within a 2-year clinical trial. And so you would need to have nearly 1,000 patients per treatment arm in order to show a statistically significant difference for the magnitude of treatment effect that sparsentan showed over an active comparator. So the conclusion was eGFR important, but not feasible. The second conclusion was we need to look at what is the biologic plausibility of another endpoint. And when you look across the different types of FSGS, there's one commonality, and that is the podocyte. This is the filtering cell within the nephrons. This is really what helps to keep protein within the blood. And unfortunately, with patients with FSGS, those podocytes begin to slough off that leads to proteinuria. That proteinuria actually directly causes further injury to healthy podocytes, which leads to this vicious cycle of proteinuria increase over time. So that really led to the third conclusion, which is can proteinuria independent of eGFR predict the patient's risk of kidney failure. And that's what they found that if you can reduce proteinuria at 1 to 2 years, you're able to substantially reduce the patient's risk of kidney failure at 7 years. And so it sets us up to then have a discussion with our Phase III data of what does this mean for the potential of sparsentan in FSGS.

Got it. So you have the upcoming AdCom for the FSGS indication. What's the latest thinking on the topics for the AdCom?

Sure. Well, we don't yet have insight from FDA about the specific questions. We assume that that's going to come much closer to them announcing the date of an advisory committee on the -- publicly and on the public register. We do have some insight into how they would be thinking about our file. So after PARASOL reported out, we had a Type C meeting with the FDA to ask whether they would be open to us filing this sNDA. And they agreed and they said that this review is largely going to focus on understanding your clinical data in the context of PARASOL. So we've obviously been very focused on making sure that we can articulate what is the clinical benefit of this proteinuria reduction and the superior proteinuria benefit that we see over a nephroprotective medicine, irbesartan, and then see whether there is a consistent pattern of results with what PARASOL saw in these registries.

Okay. And if we had to nitpick the PARASOL analysis, the database included a lot of observational data. So has the robustness of the PARASOL data or the sample size really come into the conversations with the FDA?

So we've not had discussions with FDA about PARASOL or their robustness. What I can say is this is not just typical of rare disease. This is actually a fantastic example in rare disease where oftentimes you have academic physicians that are reluctant to donate their data. This is a proprietary data set for them. We were amazed to see how eager these nephrologists were to donate their data. 26 different registries across the globe gave sufficient power to really look at longitudinal data that is robust. And we would love to be able to have clinical trial data to aggregate and do a meta-analysis or pooled analysis, much like was done in IgA nephropathy years ago. Unfortunately, those trials just don't exist. Our DUET and DUPLEX trials are really the only trials, interventional trials that were done in FSGS.

Okay. And those trials were not part of the PARASOL foundation, but is that something that could be part of the data updates that we see in the foreseeable future?

Yes, it's a great question. And we were very intentional not to contribute our data for that initial analysis in PARASOL. We wanted to maintain the independence. And so that any type of endpoint recommendation that comes out of PARASOL is not dependent on what we see with sparsentan. So we don't bias those results. We think that, that maintains a high level of integrity with the PARASOL recommendations. Certainly, we'd be open to contributing that later if there is a strong rationale, but we think that where we stand going into a review shows that our clinical trial evidence actually is consistent with what PARASOL showed in a real-world setting.

Right. And do you have a sense of endpoints that the FDA could focus on regarding approval? I know you mentioned about proteinuria-based endpoints, but any specific threshold, time frame, anything that you can add?

What I would say is reflecting what was discussed at the PARASOL workshop when the committee, including FDA was asked, and that is that those recommendations are going to be based -- they're going to be up to the sponsor to the company to recommend. And there was an important reason why. And that is because what threshold or what endpoint or measure of proteinuria may be dependent upon the types of patients that you enroll. Pediatric patients are different. If more advanced patients have more scarring and so you may only be able to show certain types of reductions in proteinuria compared to earlier patients. So I think it was wise that the PARASOL panel said they're going to leave it up to the company. What we -- what's important within our data set is every single threshold that we prespecified shows a meaningful difference in superiority over active control irbesartan. I want to be cautious that most of those at 2 years are nominally significant. All of them are nominally significant. We do have alpha protection showing statistical significance at 9 months with our partial remission endpoint because that was the primary endpoint in our trial.

Okay. And so we still get some lingering questions on the level of eGFR data that could be required here. Like will there be a focus on eGFR on the FSGS regulatory side?

It's hard to know at this point what level of detail will be the focus at an advisory committee. What I would say is in that type meeting that we had with the FDA, there was no discussion of eGFR. It was really understanding our data in the context of PARASOL. Of course, we will be absolutely prepared to talk about the eGFR data, which was all about the slope of eGFR. We saw that there was a numeric benefit of sparsentan on the slope of eGFR over time compared to irbesartan and that there was no evidence of harm on eGFR or on kidney function. But I don't believe if you assume and accept the results of PARASOL, then the role of eGFR becomes less important in assessing the benefit is what I would assume.

Right. And it's been a few months since the recent FDA changes. Anything you can comment on based on your interactions with the regulatory agency on -- specifically in the cardiorenal division?

Sure. We've been very pleased with the level of engagement. We see the same types of changes within FDA broadly, but the cardiorenal team has been consistent. The only change that I would say of note is that the long-standing Director of Cardiorenal, Norm Stockbridge, retired earlier this year. And so Aliza Thompson, who was the lead nephrology reviewer and the Deputy Director is now the Director of Cardiorenal. She's been actively involved in rare kidney disease endpoints through the Kidney Health Initiative and PARASOL. So we've been not only pleased with the stability of staffing there, the level of engagement. And keep in mind that we've had another sNDA on our REMS modification with the FDA, and they approved that not just on time, but a day early. So we've been very pleased with the level of engagement.

And because this is an sNDA, will Aliza Thompson be the ultimate sign-off on the up?

That's our understanding for an sNDA, the Division Director is responsible.

Okay. And any latest thinking on the timing of the AdCom?

So the typical advisory committees are held 4 to 8 weeks before the PDUFA date. That would put us in the November, December time frame. And they're typically announced in the public register for anywhere from 2 weeks to 6 weeks before. So I think we can expect to hear in the next month or so.

Okay. I did want to touch on the commercial side for FSGS as well. I guess once FILSPARI gets approved, just talk about the strategy there in terms of the launch, the addressable market that you...

Yes. Yes, great question. Maybe it's good to talk first on like how we see the opportunity for FSGS. We think FSGS is an even bigger opportunity for FILSPARI than IgA nephropathy. I think both have the potential to be blockbuster indications. The reason why I'm so confident about FSGS is the unmet need is very well established. Every nephrologist has FSGS patients top of mind as this is the most rapidly progressive glomerular disease and patients are often symptomatic. With IgA nephropathy, we really had to establish the urgency to intervene earlier. That's not the case for FSGS. On top of that, this is basically the same prescriber base. So physicians have a strong brand awareness for FILSPARI. Many of them have already experience. And from a payer perspective, we are already in formularies and payer plans. So all the heavy uplift that you do normally in the first 12 to 18 months prior to launch is already established. So I'm expecting an even bigger opportunity for FSGS, but also a more rapid uptake.

Okay. And so how much is the overlap with the current IgAN prescriber base?

Yes, it's over 80%. Basically, every physician that is treating IgA nephropathy is also treating FSGS patients. The only target physician that we haven't targeted so far is the pediatric nephrologist. We anticipate that we will get an indication, including pediatric. And so that's a new call point, but overall, very consistent and similar to IgA nephropathy.

Right. And for the FSGS launch, how much of an incremental sales force expansion would you need?

Yes. So we will be expanding our field force to the point that I just made, given the high overlap, it's not like a full new field team that you have to add. But it's still incremental sizing that we are doing because we want to make sure that we remain competitive in IgA nephropathy and really take the opportunity, and we are on a very strong trajectory that we can continue that trajectory, but that we also have the uptake that I was just talking about in FSGS.

Okay. And you mentioned about access that's already there for the IgAN market. So does that help ramp up the coverage of FSGS? Or like do you have to sort of renegotiate the contracts and the policies with them?

Yes. So you still have to add like the indication. So we have the value proposition in place and our account team is already actively having conversations with payers for them to understand that indication. But to your point, I mean, once you are in the formulary as a product, it's much easier to do an add-on for an additional indication.

Got it. And what's the latest thinking on pricing for the FSGS indication?

So it's linear pricing. So it's the same price. But for FSGS, it's -- since it's a sicker patient population, spilling more protein, it's double the dose for the adult patient population.

So you expect linear pricing?

That's right.

Yes. Yes. And I think importantly, if we take a step back from the dosing, our strategy for pricing across both IgAN and FSGS is really based on the position that we think it will play in the treatment algorithm, which is broad foundational therapy longer term. And so we've done a lot of work over the years to understand for both indications, what is that price that's going to be delivering the right value proposition and that really is established for this chronic condition of foundational therapy. And we're very pleased that we're able to provide strong access so far in IgAN. We would expect that we would see that same broad access with this pricing in FSGS. I mean this is a therapy that patients should be able to get access to.

Okay. So how many diagnosed FSGS patients could be out there? And like how does it compare versus IgAN?

Yes. So we have done quite some research on it over the past. We anticipate that it's about 30,000 addressable patients FSGS at launch. That could increase over time when you see more biopsies and earlier biopsies. But to Eric's earlier point, I mean, there is no approved therapies for FSGS, and we don't anticipate there is anything else in the foreseeable future.

Okay. And so longer term, do you see FSGS as a bigger opportunity than IgAN?

We see IgAN as a blockbuster opportunity, but we see FSGS as an even greater opportunity.

Got it. It's a good segue to IgAN. 2Q, great quarter. And we're doing some analysis where it seems that within the IgAN market, a lot of the products have started to see some sort of hockey stick growth, including FILSPARI in 2Q. So what's -- just talk about the market dynamics that you're seeing.

Yes, there's definitely a lot of dynamic in a rare disease market, very uncommon in rare disease. But to your point, I think we are on a very strong trajectory. When I think about the launch so far, it's basically 2 phases. The first phase was within accelerated approval. We were at about 400, 500 new patient start forms per quarter. After we had full approval last year in September, we grew that basically was 40%, and we have been stable around 700 new patient start forms per quarter Q4, Q1 and Q2. And that's on top of a very strong compliance and persistence for patients that are already on the drug.

Right. And you had some recent updates to the label with the removal of REMS for pregnancy and reduction in liver monitoring frequency. So is there a way to quantify the impact there in terms of new patient starts?

Yes. The opportunity that I really see for the REMS modification is twofold. One, it's broadening the patient population because physicians often have a certain patient profile in mind that would be compliant to monthly monitoring. Quarterly monitoring will broaden the patient base. The second part is the competitiveness. You spoke earlier about the dynamic. You have more entrants coming to this market, and we want to make sure that FILSPARI remains competitive. This is an angle that the competition was focusing on. I think that this takes part of the wind out of their sales.

And so what will be the next step for the REMS removal completely?

Yes. So we've had over the years a strategy of 2 steps to be able to first modify the REMS, and we're very pleased to be able to now achieve that. Second step would be removal of the REMS, and that would take additional exposure data and again, assuming that we continue to see no cases of Hy's law, so -- which we've not. And we'll continue to work with FDA on the level of exposure that they would want to see. They have -- we have a post-marketing requirement for 3,000 patients for 2 years. We'll continue to see whether the amount of information we have is sufficient given that they've recently approved another therapy in the class without a liver monitoring REMS.

Right. And so with that therapy's approval, do you think there might be more flexibility in terms of the safety exposure database that's required?

It's hard to say. Certainly, that's a question we'd like to explore with the agency, but I wouldn't be able to speak for them at this point on that.

Okay. And maybe if you can comment on the competitive dynamics here. Novartis is -- WINREVAIR was recently launched. So what are you seeing in the market in terms of the impact?

Yes, it's still early days. They were approved about 5 months ago, so early in April. So the second quarter was the first full quarter that we were competing against them. It was our strongest quarter. So the initial signal is positive. I think it's also good to realize that the biggest challenge that we had in the launch was really to establish the urgency to intervene earlier. I was talking about it earlier. When you have more competition coming into the market, they kind of like reinforce that message. The second part is with Novartis now also having an endothelin inhibitor is also reinforcing the importance of endothelin inhibition as part of foundational therapy. So in that respect, it will help us to establish the class. Within the class, then you're competing. We have the long-term data, the broad label. We are well established in the mindset of the physicians and the payers. So I think we have a strong position. Also given the differentiated profile, FILSPARI is a dual mode of action, so it provides a consistent nephroprotection with the long-term superior data versus a maximal tolerated RAS inhibitor. So I think we are in a very strong position there.

And so are you -- in terms of the impact, any impact in terms of the new patient starts? Or is it like the market is just growing?

It's hard to say because Novartis is not disclosing their patient start forms. The first quarter that they were in the market was a strong quarter for us in a new patient start form perspective.

Okay. And so some physicians have highlighted the ease of new patients that can get on WINREVAIR because you don't have to discontinue any medication. So just speak to how are you managing that dynamic in the market?

Yes. It's an interesting one. I've occasionally heard that. I often hear the opposite side that physicians actually are pleased that they can stop a medication for IgA nephropathy. In particular, when you think about this is a patient population that in average takes about 5 different medications. And historically, there were no approved medications for IgA nephropathy. What we are hearing from physicians is that patients are saying, for the first time, we feel we are winning. For the first time we hear from the nephrologists, you are doing well, you're hitting the target levels and you can actually stop a medication. So it's the way you look at this. I think in this dynamic market where you will have different mode of action and different modalities, it will be adding and adding and adding. FILSPARI is taking away a treatment. I think that's a positive rather than a negative.

Yes. We've not heard one patient say, "Oh, I'd rather add another medication rather than stop and get to a medication that was actually designed for them.

Okay. And maybe on the other competitor that's upcoming, Otsuka's anti-APRIL drug will be launched in 4Q, and there will be a lot of B-cell modulating agents launching in the next 1 to 2 years. So just talk about the dynamics there.

Yes. We actually don't see that class of medicines as competition. We see the B-cell therapies as complementary and another treatment option. And I think if we take a step back to how this disease historically has been treated and how it's characterized in the global KDIGO guidelines, I think it gives a very clear sense that there is an important role that both FILSPARI plays as well as immune-targeted therapies like B cells. Patients with IgA nephropathy have essentially an overactive immune system that damages the kidney. But by the time every patient is diagnosed, they already have kidney damage. They have kidney disease that is demonstrated based on their biopsy. And so the guidelines really are recommending that you have every patient with proteinuria with IgAN is on combination therapy. A nephroprotective foundational regimen, we believe that the best option is FILSPARI plus SGLT2s, and we now have really exciting data to demonstrate the additive benefit of FILSPARI plus SGLT2 and then addressing the overactivation of the immune system. Historically, that's been steroids. There's been a shift away from steroids in this space because of the safety tolerability aspects. And we believe that the B-cell therapies when they come, like Otsuka's launch potentially soon will help to be able to shift for more patients to be on that regimen. But those are all being studied on top of foundational nephroprotective therapies. And so I think the evolution is going to be increased combination and patients are essentially going to be treated better. I really hope that in the years to come, we have a future where no patient with IgAN will ever have to see kidney failure, whereas 5 years ago, every single patient with IgAN was modeled to have kidney failure within a 10- to 12-year period. So I am really optimistic that we're going to see that combination in that future that's best for these patients.

And is that data something that you guys can generate in terms of the combination or...

We're certainly eager to. Yes, we're eager to, we're open to. I would suspect that those types of studies would only happen once those therapies are approved. I think that's what makes most sense for development. But as we've done with the 2 studies we've completed with SGLT2 combination, we'd be very open to looking at combinations with B-cell inhibitors.

And maybe on the market, I think one thing that is interesting is the duration of therapy for these drugs. I think we've been trying to do some work around that. Are you able to put numbers on what you are seeing as the average duration of therapy given the drug has been launched for a couple of years now, more than a year, a couple of years?

Yes. So to Eric's earlier point, I mean, FILSPARI is really focused on protecting the remaining nephrons, and you want to do it in a chronic way. So FILSPARI is used chronically. What we have seen so far is that both the compliance as well as the persistence has been incredibly high, much higher than I was anticipating beforehand based on historical data on chronic often nonsymptomatic disease. So I think the high compliance and persistence speaks to, one, the efficacy of the drug, but also the patient services support that we are giving that is well appreciated and allows for long-term protection of the nephron that Eric was talking about.

Okay. And as we look forward to second half of 2025, what are some of the headwinds and tailwinds that Street should be focusing on?

Yes. I think the -- if I think the remainder of '25 and then moving into '26, some of the things that we talked about already, one is the modification of the REMS. Second component that we didn't talk about is the KDIGO, the global guideline final publication. The draft publication was disclosed a year ago. We do anticipate the full publication this year. That helps us 3 points. One is that the treatment target will be more aggressive. Historically, that was 1 gram per day. What the draft guideline indicated was 0.5 or preferably 0.3. So a much more aggressive treatment target, number one. Second one is what Eric was just talking about. This is basically 2 diseases. So you want to protect the kidney, but you also want to impact the immune oversuppression. So FILSPARI is positioned in a certain way. And then the third one is FILSPARI in the draft was called out as the only drug that has shown superiority versus a maximally tolerated RAS inhibitor. So I think that will further help us as well. So that's the second part. The third one is really in preparation for FSGS. We will be expanding our field force. And I think once you have the FSGS approval, I think there will be a halo effect from FSGS on IgA and vice versa.

Okay. Yes, if you can talk about that, like once FSGS is approved because it's the same prescriber base, how does it help you competitively? How does the FSGS approval help you in terms of the competitive dynamics in IgAN?

Yes, because the physician will see a broader utility for this medicine that other products don't have. And rather than to have different products in different indications, it further reinforces the utilization for FILSPARI.

Right. And given the KDIGO guidelines, the draft guidelines have been there for about a year. Are you seeing more physicians treating earlier in the disease like in terms of the proteinuria baseline that you're seeing?

Yes, we certainly see that. I think it also is indicative a little bit to the hockey stick that you were talking about earlier on. I see it more in the thought leader community and the academic hospitals. I think there's an opportunity to really educate the broader community nephrologist, and that's where the majority of the patients reside. So I think that's where really I see the opportunity. And take in mind, we see this IgA nephropathy as an addressable market of about 70,000 patients. In my opinion, we only scratched the surface so far.

Got it. And maybe just longer term because Street is probably not there at blockbuster sales. So what's the long-term sort of opportunity for FILSPARI in just IgAN indication?

Yes. I mean I would say it starts with what is the role in the treatment algorithm. 90% of the patients with IgA nephropathy are on an ACE inhibitor or an ARB. If we look at the new treatment guidelines of ideally getting these patients into complete remission, only 10% of patients on a RAS inhibitor are in complete remission. So they're essentially nonresponders to that degree and really can do better with FILSPARI. So this is a very broad opportunity for us to be able to reach. And as we're seeing in the data, in the guidelines and in the KOL opinions, combination of RAS inhibitor, ERA, SGLT2 and immune targeted is the way of the future. And so we're going to play a very important role for continued growth that will help us to be able to reach that status.

And maybe just last question, and we don't have to bring Chris on the stage for that. But on the cash runway, like what does it cover, especially in the context of you preparing for the launch of FILSPARI in FSGS?

Yes. What we've said is that we've got cash into '28 potentially beyond, and that's based on the growing revenues and the net income of milestone payments. And that really covers the continued support of the IgA nephropathy launch, preparation for the FSGS launch and really fully supporting that opportunity and all of the ongoing work that we have with pegtibatinase going into Phase III next year. So we're very well positioned from a capital standpoint to really invest in these 3 very important community opportunities.

Right. That's all the time we have today, but thank you to the Travere team for joining us, and thank you to the audience for listening in.

Thank you.

Thank you.