All right, everyone. I think we're going to go ahead and get started with the webcast. Thank you all for joining us today. I am Joe Thome, one of the senior biotech analysts here on the team at TD Cowen. It is my pleasure to have with us today the team from Ardelyx. We have the CFO, Justin Renz, who's going to be delivering today's presentation. Also around for questions, we will have the CCO, Eric Foster. The company will do the presentation. Please feel free to jump in with Q&A after the talk. Thank you very much.
Thank you, Joe. Good morning, everyone. As Joe mentioned, I'm Justin Renz, Chief Financial and Operations Officer for Ardelyx. Great to be here. Thank you. Before I get started, I want to give a shout-out to my friend and supervisor, Mike Raab, who unfortunately had to go back home last night to deal with a family emergency. We wish him well. I'll be making some forward-looking statements. We filed our 10-K a week ago Thursday, which was a great achievement, as always. We are looking forward to 2025. Yesterday, I had the privilege of going to the TD Garden. Our friends at TD Cowen also happened to have the naming rights to the arena downtown. I went to the Celtics and Nuggets basketball game. The Nuggets, as you know, won the championship two years ago.
The Celtics last year, the Celtics were missing Kristaps Porzingis, Jrue Holiday. You may have noticed Jason Tatum had an off day. He actually was only one for seven from three-point land, four for 15 overall, and had six turnovers. If I told you those facts, you probably would say the Celtics had no chance. Believe it or not, they won by seven. It was a great game. The reason why I say that is biotech and pharmaceuticals is a total team sport. Everybody's got a chip, and everybody's got to step up and lift up each other. I am so very proud to be part of the Ardelyx team. We have had our challenges over the years. Mike wrote the investment thesis for us over 15 years ago. Now here we are with two approved products that are doing very, very well.
I am looking forward to taking you through this story. It's just amazing to think about how our company and our team discovered, developed, got approved, and launched two products, which is a great accomplishment for a relatively small company. If you look at our slides, you'll see, and you know from our filings, that last year we did over $158 million in product revenue from IBSRELA and over $160 million in net product revenue from XPHOZAH. We have a strong cash foundation. Again, we were actually cash flow positive at the end of the year, finishing the year with over $250 million in cash and cash equivalents and short-term investments. We are really excited about our achievements.
If, as I move forward and think about it, to sort of paraphrase a former head football coach in the region, that was last year, and we're on to 2025. Moving forward, we really have a great opportunity ahead of us. IBSRELA is really where I'd like to start with. There really is an opportunity here. There is a legitimate market with unmet need. There is a need for a differentiated therapy, and that's what we bring. Linzess and Trulance are GC-C agonists, and they have done wonderful things for patients over the last 10 to 15 years. There still is unmet need. I had the privilege of meeting a patient last week. It's really the symptoms of pain and bloating that really is something that there's a need for.
That is where I'm really grateful to see that we have shown some signs in patients of actually helping those afflictions that they have. There is a true opportunity here. You can see from the slide, over 6.3 million prescriptions were written for IBS-C-indicated drugs last year. We believe we can get over a 10% market share. When you think about that, and our price point and the need, this can be a billion-dollar product. That is kind of where we are right now. We're really excited about the chance to do it. Our growth, again, going from roughly $16 million in 2022, we launched it in March of 2022, to $80 million and then $158 million, really an impressive accomplishment. Again, looking forward to growing this over the next roughly nine years. I'll get to that as we proceed.
It is a new class of therapy. As you can see, it's an NHE3 inhibitor. I talked about the GC-C agonist. This allows the writer to say to their patient, "Would you like to try something different? Would you like to try something new?" That is what we're offering, a new treatment. It's one pill twice a day. It really seems to work quite quickly and quite well. Abdominal pain, as I mentioned, improvement in symptoms really is something that we see over time. We published some data that shows this. It is not a segregated drug. We actually call it a retained drug now, very minimally absorbed. Our side effect profile is relatively modest. We are really, really proud of this accomplishment that we discovered, developed, and got approved and now launched this three years in.
Here's a good look at that performance that I was alluding to. You can see we started out in March of 2022 with our launch. Now it's coming up on our three-year anniversary. You can see the 80,158 that I mentioned. We have given guidance that we believe this year we can do at least $240 million in sales. We've guided publicly $240 million-$250 million in net product sales revenue this year on our path to over a billion dollars. If you look at our growth, you can see that from 2023 to 2024, we grew approximately 98%, really impressive growth. We've expanded the sales force. When we initially launched, we had 34 sales reps. We grew to 64 just over a year ago. This past year, we expanded to 124.
We did not really have the full complement of the 124 ABDs. We call them area business directors in the field and fully trained and out there until the fourth quarter, so end of the third quarter, early fourth quarter. We started to see that growth. That is why we actually had over 32% growth from the third quarter to the fourth quarter. Looking forward to 2025, again, we think the Q1 has usually some challenges. That is why it is often the most difficult quarter for drugs indicated with the IBS-C space. Again, we feel comfortable in our guidance that we can achieve at least $240 million in net product sales revenue this year. XPHOZAH was approved in October of 2023, a real great accomplishment for the team, again, developed by us, discovered by us, and approved by us.
We were able to launch it in November of last year. Hyperphosphatemia is a very challenging space, an area with clearly, like IBSRELA, unmet medical need. These are end-stage renal disease patients on dialysis. Hyperphosphatemia is exactly what it sounds like, elevated levels of phosphate in your blood. Roughly 80% of the 550,000 patients in the US that have hyperphosphatemia need some sort of prescription treatment to help them manage their phosphate. I think if you ask a nephrologist, they'll say, "Actually, eventually everybody needs some sort of pharmaceutical intervention to help with their hyperphosphatemia." We do know from the data it's been remarkably consistent that roughly 70% of patients within a given six-month time period are out of range. The KDIGO and KDOQI guidelines are roughly try to get below 5.5 mg/dL .
Believe it or not, a normal range is between two and a half and four and a half. The guidelines actually are not even to what I would call normal level. That is often considered the best we can do, to get below five and a half. It is amazing over the years that both the number of patients who need pharmaceutical intervention as well as the monthly serum phosphorus level changes have not really changed. This patient population grows modestly each year. Unfortunately, folks pass away. There is roughly, on average, a five-year mortality rate for some of these folks. That is really unfortunate. The need to help them with another hyperphosphatemia medicine, because this leads to additional comorbidities with cardiovascular events, is clear. If we can somehow help this group, there is a real chance for us to make a difference.
That is what we think XPHOZAH can do. XPHOZAH is different. It is a phosphate absorption inhibitor. It is non-absorbed. Again, like IBSRELA, a different mechanism of action, a first-in-class medicine, a different option in this case for the nephrologist as opposed to the gastroenterologist to have in their toolbox. It blocks the absorption of phosphate in the primary pathway. That is very much a differentiator of XPHOZAH. Binders are excellent. They do just what you think. They bind to the food and your phosphate, if you will, in the food that you eat. You have to think with every meal. This is really a simple medicine, one small pill twice a day. It really does its thing. It has been incredibly well received. Because, as I mentioned, there is truly significant unmet need in this patient population.
I'm going to reiterate, in a given six-month time period, 70% of these patients, so think about that, there's 550,000 patients or so in the United States on dialysis, roughly 440,000 of them need pharmaceutical intervention. 70% of those 440 are out of basically the established guidelines, which actually could be even better, if you will, in a given time. There is truly unmet need here. This is where we're focusing on. We did, as I mentioned, $161 million in sales next year, our first year of launch. As I mentioned, we launched in November of 2023. We did lose Medicare Part D coverage for some of our patients. All of our patients who are on Medicare Part D coverage lost their pharmacy benefit on January 1. There is still, as I mentioned, a huge unmet need.
That is why we feel very comfortable in saying that XPHOZAH can generate more than $750 million in peak sales prior to patent expiration. This is a real opportunity here for us to give a new medicine, a new treatment option for nephrologists and the nephrology community. Pulling this all together, we did, as I mentioned, $158 million with IBSRELA, first-in-class medicine. We believe we can do over $240 million in net product sales this year. XPHOZAH, $161 million last year. We have not given guidance yet because as we work through these new changes in reimbursement, we feel very good about its opportunity long term. Again, we have that strong balance sheet with over $250 million in cash as of the end of the year. We believe before patent expiration that combined, they can do over $1.75 billion in sales.
IBSRELA, we believe, can do over a billion in its patent expiry is August of 2033. And XPHOZAH, again, as I mentioned, we believe we can do more than $750 million in sales prior to its patent expiry, which is currently April of 2034. There is really a strong foundation for us to grow. We have started to expand internationally. We are partnered with Knight in Canada. They currently sell IBSRELA. They started selling IBSRELA in Q4 of 2021. We have received a royalty from them. Kyowa Kirin actually got their version of XPHOZAH called Fosoval approved a month before we did. They got that approved in September of 2023 and launched in February of last year. They are doing quite well. We were pleased to be able to announce that last week Fosun was able to get their drug approved for hyperphosphatemia.
It is branded now, as you can see, Wantele as of last week. We look forward to them launching in the near term. We are excited about Fosun and what they can do, tremendous opportunity in China. It is also approved in Hong Kong and Macau. Our drug is unpartnered in Europe and as well as IBS-C in Japan. There is a tremendous opportunity for both products in Europe, rest of the world, and again, IBS-C in Japan. We are obviously always looking to do the right thing. We do not want a deal ever to do just a deal. There is definitely opportunity for us to grow across the globe. Let's talk about our strategic priorities right now. Right now, our goal is to really keep that IBSRELA growth going. As we saw, roughly $15 million, then $80 million, then $158 million. We would love to keep that building.
Again, we believe we can do $240 million-$250 million this year. XPHOZAH, again, tremendous launch, clearly unmet need in that patient population. We want to be steady. We want to get the message out that this new option is available. We have been focusing on access to make sure the nephrology community knows that we will be there for them and make this drug available to them if they qualify. We have actually had a patient assistance program from day one that was quite generous. That has expanded a little bit, as you might imagine, with the loss of Medicare Part D coverage, but still is absolutely available for all patients that need it. Now our next step, really, in our iteration of our company, now that we have this solid base, is to build a great pipeline and build a great company.
That is led by Mike Kelliher in our business development group. We are really focusing on similar ideas, right? Novel medicines, novel mechanisms of action, unmet medical need where we can make a difference. We want to keep executing, executing, executing. That is so important. With that, I would really like to introduce Eric Foster, our Chief Commercial Officer, to join me at the stage with Joe. We are going to open it up to questions and answers. Thank you.
Sure. If there are any questions from the audience, feel free to throw them out. Maybe we will start with IBSRELA. If you can talk a little bit about how you are going to get from here to that $1 billion number. Is it just continued execution on what you are seeing so far, or should investors anticipate an inflection at some point? Maybe related to that, you did mention the sales force expansion. Have we seen the full benefit of that yet?
Yeah, thanks, Joe. Have we seen the full benefit? I would answer that, and I would say no. As Justin mentioned, we finished the expansion at the end of Q3 and had the team in place for Q4. They continue to be out in the field. Last week, we had our national sales meeting, tremendous amount of excitement for the team moving forward. As they continue to build their relationships with the physicians and continue to have access to these customers, not only did we expand the sales force, but we also expanded the target list. Some of these customers were new for the team. I do feel like we will continue to have momentum moving forward.
In terms of your question on the path to a billion, I feel very confident about this. If you think about how we are approaching it, one, expanding the sales force, continuing to drive more patients into the top of the funnel, I think we have an opportunity to expand the voice or amplify the voice of the patient. We know it's a very motivated and engaged patient population. We want to embrace that. We want to make sure that physicians really understand the seriousness of this disease, high incidence of depression, anxiety, suicidality. There are significant causes that are related to this disease. I think we really need to pull that to the forefront. I think amplifying the patient voice, magnifying the impact of the disease on these patients will really help connect the physician and the patient even better.
Lastly, this year, we've committed to pulling those patients through. We have a great program in Ardelyx Assist, and they've done a tremendous job for us over the past couple of years. This year, we've decided to expand there to a new role called a field access manager. They've all been hired this quarter, and they'll be out there starting the second quarter to really help the physicians and the patients as they go through their journey once they've been identified from the sales force. Really, it's driving patients to the top of the funnel, really working to amplify the impact of the disease and the patient voice, and then working with the field access managers to pull those patients through. We really feel very confident that we're well on track to that billion-dollar peak revenue.
Perfect. Now that the therapy has been out for a little while, can you comment a little bit on just overall patient retention and kind of real-world safety and refill rates? Are those as expected? What is kind of the overall compliance level?
Yeah, I would say that they are, it's as expected. There are a couple of avenues that patients have access for IBSRELA. They can go to a retail pharmacy. They can also go through a specialty pharmacy or Ardelyx Assist, our specialty pharmacy of choice, transition pharmacy. What we do see is better compliance when they do go through a specialty pharmacy and transition pharmacy. We are very proud of that. We are very connected with the specialty pharmacies and working with them. We do have a preferred path for the patient to be able to go through so that they can get the attention that they need as they go through their journey. We're able to see a bit better compliance there.
Perfect. Maybe jumping over to XPHOZAH, maybe for those that are a little bit less familiar just with the bundling dynamics, can you just give us a little bit of a backdrop of kind of what happened as of January 1, this year? We'll kind of go from there on any sort of changes that you're doing.
Sure. XPHOZAH is a class of drugs that is part of the overall dialysis patient treatment regimen. Years ago, they set up rules around the framework of how dialysis organizations would be reimbursed, which includes drugs that are, again, in the treatment of dialysis.
That includes binders and now XPHOZAH. We may disagree with that, but those are the rules as written. As a result, the time was delayed, postponed several times. January 1, 2025 was here. The dialysis bundle went into effect. What that means is essentially there is one payment where the government will pay the dialysis organization. The dialysis organization needs to furnish all the medicines to the patient. Of course, it has been kind of choppy and challenging as they all work through this. This is really something where Medicare Part D patients no longer have the benefit of what I will call a pharmacy benefit. The binders and our drug, which were covered by Medicare Part D, that part now shifts to Medicare Part B, as in boy, with the other services.
That has been the change for XPHOZAH. Essentially, it has been consistently around 60% of these dialysis patients have Medicare Part D coverage, and now they no longer do. As I mentioned in our slides and alluded to, we believe there still is a very good opportunity from a revenue perspective from the non-Medicare patients. Between Medicaid, VA, commercial, Tricare, we can drive a meaningful business. That is where that $750 million number comes from.
Maybe can you talk a little bit about the type of patients that have been coming on over the past year? Were they the most severe patients where their phosphate levels were out of control? Are you seeing more kind of broad usage across the paradigm? What are you seeing from that perspective?
Yeah. Yeah, I would say we do see utilization across all of the different patient types. Just like with most drugs, I think physicians gravitate to the more severe patient to get their first few experiences with that. With XPHOZAH, what we've seen is anecdotally significant response from patients. Physicians see that. I would say out of the gate, the vast majority were more towards the severe type patient, 6.5 or higher. We absolutely are seeing it come down now that physicians are gaining greater confidence. I'd like to just address a little bit more on what Justin was saying as well with regards to the change at the end of the year. This is Medicare only. I like to think of it more around it's a reimbursement situation, not an access situation. Those patients still do have access.
If you think about bucketing them into the Medicare patients and then the non-Medicare patients, for us, it was important to see early on, is our strategy working? Do the patients have access? As we look at the patients that were on our products, both Medicare and non-Medicare in 2024, do they have access in 2025? We have been able to validate that they do continue to have access through our patient assistance program if it is a Medicare patient, or through their prescription benefit or their pharmacy benefit if it is non-Medicare. We have also been able to validate for new patients identified in 2025, if you are a Medicare patient, do you have access to XPHOZAH? The answer to that is yes, through Ardelyx Assist and our patient assistance program. Of course, non-Medicare as well.
For us, it's important that we are able to validate that our strategy is working. From an operation standpoint, those patients who were on product in the past and new patients identified in 2025, they still continue to have access to XPHOZAH.
Maybe to that point, just to make sure that physicians are still prescribing and obviously the dialysis centers are aware that this change is going on, can you talk a little bit about what you and your sales force need to do either on the physician touchpoint or with the dialysis organizations to make sure that prescribing trends aren't changing, even though the bundling dynamics maybe are?
Yeah. It's a great question. I will say right now, one of the things that we continue to hear is there's been a lot of turmoil out there in the market, particularly for the binders.
This is new for physicians. For us, one, we're just very empathetic to the situation and all the additional work that the teams at the dialysis organizations and the nephrologists are having to absorb because of this. For us, our message is very simple. We want the nephrologists at the center of prescribing just as they were in 2024. It is important for us that we come out of the gates, that we have a high share of voice. What I mean by that is we're communicating that message clearly and consistently to the physicians as well as to the dialysis organizations. Even this past Friday, I had a meeting with some dialysis organizations just to continue to reiterate because there can be confusion out there in the market, particularly for the phosphate binders. We want to keep our message simple.
That is that they continue to put the nephrologists at the center of decision-making based on patient need. We just need to continue to do that. Instilling confidence and then action, continuing to identify those patients that are appropriate for XPHOZAH.
Perfect. When you think about revenues for XPHOZAH this year, how should investors be thinking about this? Is this a little bit of a kind of a relaunch year in this new environment? Obviously, you give IBSRELA sales guidance. When do you think you might have enough comfort around the new reimbursement pushes and pulls that you could be in a place to give XPHOZAH revenue guidance as well?
That is a great question, Joe. That is top of mind for us. We try to be very methodical and measured in our approach. As Eric mentioned, there is a lot of disruption in this space right now. We are sensitive to that. We are seeing that with all our patients. As Eric mentioned, our most important thing is to make sure that the nephrologist writes the script and we make sure the patient gets the script. Roughly 60% of the patient population historically for us, and we have seen over the years, was a former Medicare Part D coverage. That is what we are trying to observe to see how much that impacts us. It is too early for us to really give a definitive answer.
We are monitoring it closely. We do not block access to prescriptions. Although Imperfect, IQVIA, and Symphony do publish numbers, IQVIA tends to not publish non-revenue scripts. That is probably the best one to follow. We're not in a position yet to give you a definitive answer. As soon as we feel comfortable as a group collectively that we have it in a place where we know we're confident of what we're seeing, we'll certainly share that.
Yeah. I would just go a little bit farther and just say at least a couple of quarters. We're certainly seeing some new things. We need to continue to validate those and work through it. It's not impacting access for our patients. As Justin mentioned, quite disruptive out there with the binders. We need to allow them to kind of get to more of a steady state so that we see repeatable trends and are confident in those trends. Probably a couple of quarters at least for us.
Perfect. You mentioned during the presentation bringing in Mike Kelliher, how are you thinking about the overall BD strategy? Obviously, the company's done a good job at kind of establishing a commercial presence, working through the prior authorization process. You have established your chops there. Do you want to add to the commercial side? Do you want to have some pipeline events on the development side? Kind of how are you thinking about where you want to supplement the business?
Yeah, a little bit all the above. I mean, for us to add a commercial product, it really has to make sense and hit all the key elements that we look for as a company: novel mechanism, unmet need, long patent life. Those are, of course, very much in demand.
We may not be able to go shopping at some of those nice malls like we have outside these doors. We are going to be really methodical. We are looking at every stage to answer your question, specifically from phase one to commercial. It has to really meet that fit that I alluded to, that we believe our commercial chops are excellent. We have built a great team. We also have an excellent development team looking for additional work to do. We have to keep those folks busy as well. We are agnostic really to stage of development. We do want to build a great pipeline. I think the right long-term growth is for us to have multiple assets at multiple stages of development.
Yeah. We want to make sure we do not take our eye off the ball with IBSRELA and XPHOZAH.
We've got deep insights in nephrology and in gastroenterology. It makes some sense there in some of the adjacent areas there. As Justin mentioned, I'm very proud of this team and what they're able to do from a commercial standpoint. We've proven that we can pivot from nephrology to gastroenterology and set sound marketing strategy, have a very experienced team to be able to establish relationships, identify patients, drive clinical conviction, and then a great program in Ardelyx Assist to help pull those patients through so that they can get access to our medicines. I feel like that certainly can be replicatable and something that we can lean on.
Is the sales force for XPHOZAH and IBSRELA the right size right now? Do you anticipate making any changes in the year ahead?
Yeah. I do not anticipate making any changes. Just to remind the team or remind folks about the IBSRELA expansion. We moved from 64 to 124. What that allowed us to do was to bring in more high-riding non-GIs as well as additional advanced practice providers or APPs, physician assistants, nurse practitioners, so that the team can focus on the writer group that's responsible for the vast majority of those prescriptions that Justin showed you. I feel like we have plenty of opportunity within our physician list now and do not anticipate adding more there.
Really the same holds true for XPHOZAH. Out of the gate size, I think right. We've got a target list of the physicians there. We've been able to see good penetration first year in launch. Still room to grow there. Before we kind of disrupt things and add more physicians there, I think there's still plenty of opportunity within our focus group right now.
Perfect. And Justin, you are the finance guy here. Do you want to just touch a little bit on the state of the financial side of the business? Where does your current cash balance get you to? And maybe how much of that could be earmarked for a BD deal?
Yeah, great question. As we mentioned, we finished the year with $250 million in cash. We do have some debt, which is interest only until July of 2028. We were fortunate to be cash flow positive towards the end of last year, which is great. I think we'll have a minor setback in Q1 because of the loss of Medicare Part D reimbursement for our XPHOZAH patients.
In a way, as you mentioned, sort of a relaunch year for XPHOZAH, so to speak, from an economics perspective. Again, we are pretty well resourced. We do not have any imminent needs at all for capital. Our capital needs are going to be really to expand the business. Depending on what the right fit is that we as a team think to build our pipeline is the right answer. We are going to spend a little more money this year than last year to try to build out a great company. We have plenty of reserves right now to do what we need to do.
Perfect. Awesome, with that, I think we are just about out of time. Thank you all very much for joining us. Thank you to the Ardelyx team.