Albireo Pharma, Inc.
Q4 2020 Earnings Call Transcript

Published: 25 Feb 2021

[Operator:]

Good morning, and welcome to the Albireo Pharma's Fourth Quarter and Year End 2020 Financial Results and Business Update Presentation. At this time, all participants are in a listen-only mode. A Q&A session will follow the formal presentation. Please note that this conference is being recorded. I'll now turn the call over to your host, Paul Arndt, Managing Director of LifeSci Advisors. Thank you. You may begin.

[Paul Arndt:]

Thank you, operator, and good morning, everyone. Thank you for joining today's call. This morning, Albireo issued a press release highlighting its recent business accomplishments and reporting its financial results for the fourth quarter and year ended December 31, 2020. This press release is accessible via the company's website at www.albireopharma.com.

[Ron Cooper:]

Thank you, Paul. And thank you everyone for joining us this morning for Albireo's Q4 and year end 2020 results and business update. With me today are; Simon Harford, our Chief Financial Officer; Dr. Pat Horn, our Chief Medical Officer; and Pamela Stevenson, our Chief Commercial Officer. I'd like to begin today by giving a short review of 2020 and then moving into 2021. 2020 was a transformational year where we delivered against all our stated milestones and commitments and plan. And we're looking at another transformational year in 2021 where we plan to deliver against guidance, starting with becoming a fully commercialized organization with the plan launch of odevixibat, expansion beyond PFIC into other rare pediatric conditions and progressing our pipeline in adult cholestatic & viral diseases. Starting with 2020, the story was overcoming unprecedented challenges. Albireo, like many other companies, worked under new conditions with the global COVID-19 pandemic, new constraints with remote working and unforeseen challenges conducting clinical trials and manufacturing around the world in a fully virtual manner. Despite these headwinds, our team persevered, overcame the challenges and ultimately delivered on a very successful 2020 measured by our progress with odevixibat, our pipeline and advancing the growth of the company. First, with odevixibat. We've committed to delivering the PEDFIC 1 Phase III study results in PFIC. Not only did we deliver those results, but they were strong, hitting both primary endpoints with triple-digit p-values and a solid tolerability profile with low diarrhea rates.

[Simon Harford:]

Thank you, Ron. Let me quickly summarize our financial results for Q4 and full year 2020. Revenues were $8.3 million for the year ended December 31, 2020, compared to 9.6 million for the year ended December 31, 2019. Revenues were $2.7 million for the fourth quarter of 2020, compared to $6.4 million in the same period last year. The decrease in revenue for both the full year and fourth quarter primarily relates to a sales based milestone, achieved in 2019, offset by higher sales based royalties earned in 2020, from EA Pharma, which, as you know, are passed on to HealthCare Royalty Partners as part of an agreement to monetize the royalty stream. R&D expenses were $76.8 million for 2020, up from $45.6 million for the same period in 2019. R&D expenses were $20.1 million for the fourth quarter of 2020 compared to $14.2 million to Q4 of last year. The increases for both the full year and fourth quarter were mainly the result of headcount and program expenses related to odevixibat. The main drivers of the increase in expenses for our lead asset were related to the PEDFIC regulatory submissions, as well as clinical trials for biliary atresia and Alagille syndrome, as we continue to progress our development programs. In addition, for the full year, R&D expenses increased due to preclinical programs. General and administrative expenses were $42.4 million for 2020, compared to $23 million for the previous year. For the fourth quarter of 2020, G&A expenses were $14.2 million, compared to $6.2 million for the same quarter in 2019. For both the full year and fourth quarter, the increases were primarily attributable to headcount and expenses related to commercial readiness, as discussed during our recent commercial day. Net loss for the year ended December 31, 2020, was $107.6 million, or a loss of $6.73 per share, compared to a net loss of $62.7 million, or a loss of $5.04 per share for the year ended December 31, 2019. For the fourth quarter of 2020, the net loss was $24.8 million, or a loss of $1.30 per share, compared to a net loss of $7.5 million or a loss of $0.57 per share in the fourth quarter of 2019. As of December the 31, 2020, we have cash or cash equivalents of $251.3 million, which compared to $278.7 million in September 30, 2020. Given significant financings during 2020, using both equity and non-dilutive capital, we currently anticipate our cash to last into 2023. Additionally, we are eligible for a priority review voucher, assuming approval, and we would plan to monetize it at the appropriate time. For 2021, we are providing guidance for operating cash burn, to be in the range of $120 million to $130 million as we advance our development programs and prepare for the anticipated PFIC launches for odevixibat. We also anticipate 2021 revenue for odevixibat to be in the low single digit millions, assuming timely approval, and then ramping up over time as access is achieved, approvals in other countries have gained and new potential indications are launched. With that, let me turn the call back over to run for closing remarks. Ron?

[Ron Cooper:]

Great. Thanks, Simon. So to recap, we have a number of significant milestones that we expect to drive our growth and we feel good about the milestones to come in 2021, and to deliver against guidance. We’re confident or a path to a billion because the tremendous global opportunity, a robust value proposition and our high level of readiness and our action to expand beyond PFIC to other diseases. The Albireo opportunity is not about odevixibat and PFIC in the US. Rather, it's about building odevixibat into a leading global product on the back of multiple indications and geographies, and taking out promising new compounds into larger adult patient populations. We thank everybody for joining us. We're pleased to open the call now for Q&A. Over to you, operator.

[Operator:]

Thank you. At this time, we'll be conducting a question-and-answer session. Our first question comes from the line of Yasmeen Rahimi with Piper Sandler. Please proceed with your question.

[Yasmeen Rahimi:]

Hi, Tammy, thank you so much for taking my questions. I may have -- you may have stated that, but if you could remind us again, what is the number of the -- how big is the sales team of Travere that they have? And what is the outreach just to their pediatric hepatologists across regarding regardless whether they're transplanters centrist or not. So you could just give a little bit color of the depths of Salesforce and expertise that they have would be helpful. And then I have a follow up question.

[Pamela Stephenson:]

Hi, Yasmeen. It’s Pamela here. Just answering your question on how big their sales team is. They have a team of 12 representatives in the US who are highly experienced and have long standing relationships with the pediatric hepatologist. They also call on some other related specialties as well, but their primary focus is the pediatric hepatologist. So we're really excited about this and how it will help accelerate our launch and uptake at launch.

[Yasmeen Rahimi:]

Thank you. And then another question I have is, can you provide a little bit color on now as one-third has begun enrollment, how it's progressing? Maybe also remind us what percentage of the sizer here in the US versus ex US? Can you give us a little bit more of that granularity and also whether you're planning to turn on more sites across those studies as third and bold, given the pandemics to just kind of give us a little bit numbers around the progress that you're making on both fronts would be very helpful for us?

[Ron Cooper:]

Yeah, absolutely. Look, we're absolutely really pleased that where we are with ASSERT, it’s actually going exactly according to plan. So we have our first site up and going, we anticipate having all of the sites up and going. In the first half of this year, we've accounted for the challenges, the global pandemic, and that's why we have 35 sites around the world. And we'll try and use -- the global aspect of the study as an advantage, to go to places where things open up. But as I said at the beginning, we're up and going, and we feel pretty good about our guidance for the Alagille ASSERT study.

[Yasmeen Rahimi:]

Thank you so much. And I'll jump back into the queue.

[Ron Cooper:]

Thank you. Yasmeen

[Operator:]

Thank you. Our next question comes from a line of Liana Moussatos with Wedbush Securities. Please proceed with your question.

[Liana Moussatos:]

Congratulations on your progress, and it was an excellent commercial day. I have two questions. So say two years from now, and what would be the parameters for you to decide to extend your collaboration with Travere? And my second question has to do with A3907, the Phase 1 trial, any biomarker data in there, what kind of data are we going to see this year?

[Ron Cooper:]

All right, Liana thanks very much for those questions. I'll take the first one, and then Pat maybe comment on A3907. Look Liana, we go on and get ahead of ourselves here, right. We're just starting this partnership together. But I think the thing to talk about this partnership is, you know, Simon, Pamela and myself and others, we've been involved in many global launches, many global launches, right? And if we reflect back on those launches, the one thing we might have regretted is not going hard enough at the beginning, right. And so in our experience, we always say, now we're doing well, we can add some resource, and maybe at the end of a product lifecycle, we probably leave on too much resource. So since we have a real opportunity here, we said, let's use our experience and really go at it hard to really flood the zone. And that was our thinking with, you know, working with our relationship with Travere. And then we looked at a bunch of other different companies, and different potential partners, but absolutely Travere is right at the very top, because why, they have five years of history with our key customers. So we think this is going to be a wonderful relationship. I've spoken to their leadership, they're very excited to be part of an exciting launch of odevixibat, we're excited to work with them and together, I think we're going to -- we're really going to accelerate the uptake a lot of expense. So, let us do that first. And then we'll figure out how the rest of it goes. But Pat, do you want to talk about A3907?

[Pat Horn:]

Yeah. So, you know, A3907 is really the first systemic IBAT inhibitor. So this is a traditional Phase 1 study, it’s going to be a combined single and multiple dose study. And we'll be looking predominantly at pharmacokinetics and safety tolerability in a typical dose escalation fashion. But at the same time, there will be major environmental biomarkers related to bile acids, bile acid production and bile acids elimination.

[Liana Moussatos:]

Thank you very much.

[Ron Cooper:]

Thanks Liana.

[Operator:]

Thank you. Our next question comes from line of Ritu Baral with Cowen and Company. Please proceed with your question.

[Unidentified Analyst:]

Good question. Hi, guys, this is Amita on for Ritu this morning. Thank you for taking our questions, and congrats on the quarter. So two questions from us actually. Firstly, what data will you have in hand before beyond the NAPPED natural history data to support the pharmaco economics behind the pricing at the time of approval? And then following-up on Yasmeen’s question from earlier, did you give us some color on the estimated number of treating physicians you will get access to via Travere? And would you have any plans to do additional similar agreements in the US and EU? Thanks.

[Pamela Stephenson:]

Hi. It's Pamela. So the first question you asked around, what data we'll have in hand beyond the NAPPED data. You know, of course, we have our open-label study going on now, which gives us great long term data to add into the dossier submissions with payers. And then secondly, I call out our PEDFIC study, which is our burden of illness and caregiver study that we are currently working on and fielding and that is collecting data on the burden that this disease takes on caregivers and their families and the cost to these families and to society. This will be very important, as we know, as we talk to payers to really be able to show them the value and they're looking for this type of evidence and value as to the impact of the burden of disease. Your second question which has to do with the treating physician, the beauty of this relationship with Travere is they are calling on the exact same for potential prescribers that we will be calling on. And so it's the same universe that we've talked about before, which at the top is the 100 pediatric hepatologist, who are the specialists, but there is the broader universe of about 1,100 potential prescribers. And as Ron has outlined, having two teams work on this right from day one, allows us to get out to all of these potential prescribers that much faster. So again, really, really pleased with the synergies of the two teams here.

[Unidentified Analyst:]

And do you have – yeah.

[Ron Cooper:]

Just to sort of loop around that a little bit. From an access perspective, I think that, we're very confident our ability to gain access to some the fact that the access strategy indeed impact that we have between PFIC and PEDFIC studies, the two studies between the NAPPED data and the caregiver burden. So that is a good package. And we're already in dialogue with payers. So we feel really good about that. And as it relates to the Travere relationship, that's a US only relationship. And we'll focus just on the US for that. We're not planning on any other geographies to go into partnership, at this time.

[Unidentified Analyst:]

Okay. Okay. Great. Thank you.

[Ron Cooper:]

Thanks very much for the questions.

[Operator:]

Thank you. Our next question comes from line of Brian Skorney with Baird. Please proceed with your question.

[Brian Skorney:]

Hey, good morning, everyone. Thank you for taking my question. Just wondering, if you had any recent dialogue with the FDA on the potential for an advisory committee? And you say, you're prepared for a second half 2021 Launch Road events about I guess, what sort of position would be in should approval come early, end of the Travere deal at all, provide some buffer to help you do that? Should you get an approval ahead of PDUFA?

[Ron Cooper:]

Thank you for the question, Brian, wouldn't it be great to have an approval early. Look it's hard for me to comment on the regulatory discussion, only – or engaging in a very good dialogue with them in the event that we did advisory committee – we are going to be – we're going to be ready. So we're pleased with the dialogue thus far. And you're absolutely correct. One of the other considerations of working their relationship with Travere is they are already out there. They are already calling on pediatric hepatologist. They already know how to navigate those special hospitals. And so in the event that we were lucky enough to have an approval earlier. We will be ready to go with Travere team but frankly, we'll also be ready from perspective, as well. So, let's cross our fingers for both scenarios.

[Brian Skorney:]

Right. Thanks, Ron.

[Operator:]

Thank you. Our next question comes from line of Joseph Stringer with Needham & Company. Please proceed with your question.

[Joseph Stringer:]

Hi, good morning. Thanks for taking our questions. For the Alagille trial, can you describe a little bit more detail around sort of the genetic identification process of the patients in terms of percent of patients who could potentially be excluded from the trial? And maybe just more generated for the Alagille and the biliary atresia trial, can you may be talk about potential screening failure rates assumptions there relative to what you observe in PFIC? Thanks.

[Pat Horn:]

Yes, this is Pat. So, in Alagille, our study is open to patients with mutations in both NOTCH2 and JAG1 genes and that is almost all of the Alagille patients. So, from a genetic point of view, almost all of the Alagille patients will be eligible. In terms of screen failures, so we have assumed roughly for Alagille a similar screen failure rate that we had in the PFIC population because in order to intervene elevated bile acids and an elevated pruritus score. Biliary atresia is a bit different. So, these infants are eligible right after Kasai and it really is an all-comer study. So, there are very, very few exclusion criteria, and we expect the majority of patients who are identified and whose family are willing to participate will be eligible.

[Joseph Stringer:]

Okay.

[Pat Horn:]

Thanks very much.

[Operator:]

Thank you. Our next question comes from line of Tim Lugo with William Blair. Please proceed with your question.

[Tim Lugo:]

Thanks for taking the question and congratulations on the partnership. I know Travere team, while not large and size, is outstanding and quality and experience. I'm sure they'll be very focused on the new product. And that kind of leads to the question will they be distributing events about atresia specialty channels? Well, I'm just wondering kind of how integrated the back end will be between the two companies around distribution, MSLs, or maybe even if there was a need for a pair hub?

[Ron Cooper:]

Thanks very much for the question, Tim. You're absolutely right. We're excited to be working with the Travere team and I know that they're excited about being part of a big launch. But we try to keep this as simple as possible, right? So, think about it this way. Albireo is responsible for all the distribution. We book all the revenue. This is just a simple arrangement where we pay Travere certain fees to compensate sales representatives for their efforts for selling out of expense during the lifecycle promotion, and that's it, right. So it's very much focused on their sales team, the rest of it we will take care of.

[Tim Lugo:]

Okay. And maybe Simon, can you help us on how that will flow through the P&L as we kind of worked the partnership into our model?

[Simon Harford:]

Yeah. I mean, it's very simple. We'll book all of the revenue related to that. And in the operating expense line on the commercial you would expect to see the costs related to the fee-for-service that we paid to Travere will be booked.

[Tim Lugo:]

Okay. So we'll just work it into the SG&A kind of….

[Simon Harford:]

Reps.

[Tim Lugo:]

Through up to their reps. Okay, fantastic. And I guess one last question, are you looking at any partnerships for other regions?

[Simon Harford:]

Not in this type of structure, right. So when I talk about this type for the Travere arrangement is a relationship to actually boost from a promotional perspective. In other parts of the world, our plans in Europe, we'll have our dedicated Albireo team. And then in other countries, such as we announced medicine in Israel, Israel, but other countries like the Middle East, parts of southern Europe and Latin America, we plan on engaging in relationships with top quality companies in those regions. And we're well advanced in our discussions with those companies note to announce some more of that as the year progresses.

[Tim Lugo:]

Great. Thank you for the question.

[Simon Harford:]

Thanks, Tim.

[Operator:]

Thank you. Our next question comes from line of Ed Arce with H.C. Wainwright. Please proceed with your question.

[Ed Arce:]

Hi, great. Thanks for taking my question. Just a few for me. Firstly, on your commercial outlook, is there -- well, first of all the -- if you could share with us, given your data what you're seeing in terms of the breakdown of targeted physicians between sort of transplant centres and other sort of academic centres or other sorts of sites? And if there's any sort of meaningful differences in the way that you approach the targeting of those physicians, that's question one. Second is, if you could remind us the breakdown that you see at this point between sort of commercialized and other medicare medicaid split. And then lastly, with the ex US markets, and some of the regions I think clearly, certain countries like Turkey and Israel are of interest due to the higher prevalence of patients with -- that are due to consanguineous disease, are there perhaps other specific countries or regions that would fit that sort of profile that you're also targeting? Thanks so much.

[Ron Cooper:]

Thanks for the question. So I think the three questions were sort of a breakdown of kind of where the targets are, the second one on sort of the mix between payers and what it looks like in some of these high prevalence countries. Let me just take the first one. And then the other two, I'll let all that Pamela address because this first one is pretty simple, right? So as Pamela said, there are about 100 key individuals in the US, and they are in about 60 centres, right. Then if you go down a little bit deeper, there's probably another 400 key pinion leaders prescribers, and then another 600 hospital folks. So there's a very concentrated approach in between the Albireo team and the trivia team will be able to cover them and in a very intense way from day one, to try and maximize the number of patients that we will get on odevixibat. And then, you know, Pamela, can talk a little bit about the mix of what we expect, and then what other countries have a higher prevalence. So maybe over to Pamela?

[Pamela Stephenson:]

Hi, sure. It's difficult for us to know in advance how – what percentage of our patients will be, you know, primarily Medicaid, Medicare, but based on looking at other analogues and my own experience with other populations. We you know, we saved likely between a quarter and a third of the US patients will be Medicaid patients. So that's your – the second question you had asked. And on the third question around other countries where we sort of see a little bit of a higher prevalence rate, certainly in the Saudi Arabia, Turkey are two important countries that come to mind that have higher rates.

[Ed Arce:]

Great, thanks so much. That's helpful.

[Ron Cooper:]

Thank you, Ed.

[Operator:]

Thank you. Ladies and gentlemen, this concludes our question-and-answer session. I'll turn the floor back to Mr. Cooper for any final comments.

[Ron Cooper:]

Great. Thank you, operator. Well, thank you all for attending today's conference call. You know, as we enter into a new stage of the company, we will continue to update you on our commercial planning and our overall growth in our ambition to Albireo. Appreciate the attend today. We have a lot of exciting near term milestones ahead of us. Our financial position is strong, and this will enable us to continue to advance Albireo mission to provide hope to families, liver diseases and the entire liver community. Thanks again for your continued support.

[Operator:]

Thank you. This concludes today's conference. You may disconnect your lines at this time. Thank you for your participation.