I guess take a step back and.
Primary.
I guess take a step back and go through the data that went into those new labels. Can you just walk us through the CLEAR Outcomes study and the findings there?
The CLEAR Outcomes study was a 14,000-patient outcome study which measured MACE-4, MACE-3, and a variety of endpoints in both a non-statin population in both a primary and secondary prevention patient population. Why that's important is that's obviously the ticket to the game for cardiovascular event. The results were fantastic. We showed some very meaningful reduction across all those endpoints. Really compellingly is we saw almost 40% reduction in events in a primary prevention setting, which those are patients who have not yet had a cardiovascular event. In a patient population that previously only had statins as an option, which as we know with statins there are a lot of nasty side effects. We believe up to 30% of the population can't take enough of a statin to meet their goals, to meet their cardiovascular health that they need to.
Being able for us to demonstrate a benefit in that population gives a whole new slate of tools for primary care physicians, for patients who want to help manage their LDL-C and their cardiovascular risk in an area that there previously was nothing except for statins.
Right. Right. So maybe walk us through the first couple of years of the launch and what changed when you had the label updates, both in terms of what changed in terms of your focus, your messaging, but also the organizational investment.
Yeah. So when we first launched, it was March of 2020, which if that month sounds familiar to anyone, that was the month that everything shut down. I remember scrambling going to the grocery store thinking, I don't know when I'm going to be able to do this next. It was a difficult time to launch. We launched with, I would say, a fairly restrictive label. We were indicated for ASCVD patients on top of a max tolerated dose of statin, which in the U.S. is really only about 8 million patients. It also was a difficult drug to get reimbursed just because of that hyper-restrictive label. In October 2021, we right-sized the organization. We had, I think, about 300 representatives at that point. We went down to 70. We made two promises.
We promised that we would continue to grow consistently every quarter, which we have done since then. We promised we would focus and get to a positive readout of the CLEAR Outcomes trial, which I just mentioned. We did. Back in January of last year, we sort of re-upped our sales force again, knowing that the label was coming in April. We have sort of built the infrastructure needed. We have a, I do not know if I am supposed to use this phrase, we have a legitimate enterprise, a commercial organization. We have been using that as a fuel since the label.
We had them out a few months beforehand to kind of get primed and get ready for, know their routings, know their physicians so that when we did get the label, and then when we further got later reimbursement access around the new label, they were already familiar and familiar with the territories. After April, we got the new label. I would also point out in, I would say, unheard of timeline, the payers came around to this new label. We received reimbursement for not only the outcomes benefit in both the primary and secondary setting. We were able to be used with or without a statin, which I think opens up 70 million patients for us in the United States. Not only that, but I've just been blown away at the ease of the access.
In many of the major payers, the prior authorizations are gone, which I have never worked on a branded drug that did not have a prior authorization. Even those that do have a prior authorization, it's minimal. A lot of times it's an electronic look back or it's just an attestation of checking a box and submitting the form. That to me was the real sort of watershed moment of how do we grow this drug because what was before our biggest hindrance in getting this drug in patients' hands was all but gone. That's been the case consistently. We've brought new payers online. I think we're up to about 190 million covered lives in the U.S. under the new label, under the new prior authorization criteria.
I think you kind of pointed to this, but prior to the label update, what was stopping physicians using the drug? To what extent was it reimbursement access versus wanting to see more data?
It was completely an access problem. Physicians love the data. I will say that forthright. It's a tool that they haven't had before. The outcomes data is incredibly compelling, especially in that primary prevention population that I mentioned. It is an exceedingly tolerable drug. We've not heard any issues from tolerability or from side effects or the patients discontinue because they don't feel like they can take it. It was strictly an access problem. It was difficult to get through that reimbursement process. We could not go into the primary care setting for that exact reason. There is still a slight perception that it's difficult to get, and we're actively working to manage that. We have 15 reimbursement managers out in the field now who are helping doctors' offices walk through that reimbursement process and saying, here are the plans that you have.
You don't have a prior authorization. Here's the ones that you do. When you do have the prior authorization, we will help you navigate that. We are actively working to mitigate that perception out there. I think we are seeing some really good progress there.
What are the, what's the feedback from physicians now that you're hearing in terms of they have access to the drug, they're trying it in more patients and different patients? How's their perception of benefit and safety?
Yeah. So the ones that we're talking to, they love it. We don't get any pushback, to be perfectly honest. We occasionally hear some murmurings around the access side, but we think that's just residual from before. Our biggest headline was just more awareness. Getting out there and getting in front of more doctors and getting the name out there. I think we also have some targeted digital and consumer plans that we're doing in the second half of this year as well that will help spread that awareness. It's progressing. We test our unaided awareness every twice a year, and we continue to see progress against that. We're making good progress. I would say right now we're about where I would expect for a drug of this life cycle. We just need to continue that momentum on awareness.
So then digging in more on that marketing effort, what tools are you using in terms of digital media versus DTC advertising? Where do you think the right investment is?
I'm actually always pleasantly surprised, I'll say, by the return that we get on our digital resources. It's very targeted to the physicians that we know are likely to be prescribing our drug. The ones that prescribe a lot of ezetimibe, they're ones that are not necessarily the entrenched statin or PCSK9 doctors. We can target them directly in terms of an awareness campaign through the digital avenues that physicians use. On the patient side, we have nailed the lipid lurkers. They're little minion-looking things that lurk inside your arteries and kind of awareness on what that could mean. I think if you go to the Cleveland Clinic website for statin intolerance, they're hanging all over the place. Looking at ways that patients who are concerned about their statins or the side effects of statins, which there are a lot of patients out there.
I had one physician mention the TikTok doctors are his biggest nightmare because they talk about the dangers of statins. There are a lot of people out there. Getting them kind of that next step of there is an option available for you. We are able to target them very directly and very succinctly.
Where do you think you've moved in terms of a high-level market share in terms of those populations like primary prevention or statin intolerance, the secondary prevention? Where are you being used most?
I think we're being used mostly in the primary prevention setting at this point. We've seen really good progress there, and we've seen a good response there. Honestly, that's where our value driver is, right? We're the only ones playing in it right now and for the foreseeable future. Of that 70 million patients, that's, I think, 40 million of them. There is a sizable market there that we can go after, that we have demonstrated outcomes in, we have a demonstrated benefit in, and that we know physicians need an answer for.
Got it. So we've seen this uptake show up through the prescription data. You saw really good double-digit growth quarter-over-quarter throughout last year. First quarter slowed down a little bit. Can you just walk us through the dynamics there?
Yeah. It was an interesting first quarter with some of the changes that happened on the Medicare side, right? This is the first quarter that we saw the IRA in place and some of the new cost sharing and smoothing out of how all that works. From patients, from payers, and from providers, we heard a lot of confusion. What is my deductible? What is my copay? What do I have to do to get this prescription pushed through? Even some questions around, is Medicare even going to be funded, period? If we split out internally and look at growth in the commercial plans and growth in the Medicare plans, and when you split those out, commercial plans were growing exactly the way we expected them to. The hampering was entirely on the Medicare side.
We heard some deductibles back in January, or not deductibles, copays back in January, some upwards of $200 for patients. Patients would be deciding, do I take my asymptomatic LDL-C drug or do I take my diabetes medicine? That obviously was a headwind for us. The good news is, and I was just in an investor meeting talking about this, they said, how can you be confident that you'll.
I'll have the next question, right?
Yeah, of a return to normalcy. The answer is we've already seen it. We're already back in the prescription growth trajectory that we would expect to show that double-digit growth. We're on pace to do very well. The copay reset now, I think we're seeing copays of $20, $30, $40, and in a lot of cases, it's zero. Once that out-of-pocket gets hit on a Medicare patient, the copay for a preferred drug, which we are, is zero. To me, that is just fuel on a fire for being able to grow this drug.
You haven't provided guidance, but what's the right way to measure success looking forward in coming quarters? Is it double-digit? Is it 10%, 15%? I know you're not going to give me an exact number, but just give me a sense.
It's nice to try though. No, but I mean, I think you're thinking about it the same way we are. We think this is a very durable growth drug, right? If you look at some of the analogs that we have in the cardiovascular space, it's that consistent growth all the way through LOE, to be honest. That is why we are fully committed to making this a blockbuster drug. By showing that 10%-15% or consistent growth, that gets us there. We expect to continue to see that basically up until the point that generics come in.
Tie that back into how you think about investing in the brand from the commercial organization. Is it right size today? Are there opportunities to build as the product grows?
We think we're in a very good place from both a spend standpoint and from the size of the sales force, the size of the infrastructure supporting that. There's always opportunities to assess new investment. However, I will say that will likely come as a reallocation of less effective investments. We meticulously track the effectiveness of every dollar we spend. I wouldn't say necessarily increasing that commercial spend, but more reallocating it to something that we think might be more effective.
Can we talk about loss of exclusivity a little bit? Walk us through the patents that you have listed in the Orange Book. Of course, like everybody would expect, there are antifilers already. Just walk us through the next steps there, the timelines with that process.
We had nine antifilers, and we say we were very flattered that nine people would want to make this. Yeah, we have solid IP until middle of 2031. That is composition of matter with a PTI extension gets us to June of 2031. To your point, the antifilers came in last year, I believe it was, nine filers, and we are in the process of that, which honestly we see more as an opportunity. We also have patents that go till 2040. Those are formulation patents. We think that there is an argument to be made that we can extend past 2031. We will not see the trial is 2027 for the generics litigation. That is, I would say, when we would expect to have full resolution on this. We are confident that we will get something, but we will have to see what that is.
Great. Okay. Let's talk a little bit about continued life cycle management, label extension opportunities. One thing that you're doing right now is looking at triple combinations with statins. Can you just walk us through that program?
Yeah. We announced back at the year-end earnings call that we were pursuing a triple combination in the United States. This would be bempedoic acid, ezetimibe, and one or two different possible statins. The reason we're doing this is we think, one, this would be the single most efficacious LDL-C drug on the market. We're looking at anywhere 60%-70% LDL-C reduction. All three of those have proven outcomes and would be a tool that physicians could use where it would just be an adherence play, right? Because everyone would just have one pill and you're at goal.
A copay benefit.
Exactly. I think one of the other things is when you look at bempedoic acid, it has a lot of mitigating factors that kind of knock back the negative side effects of a statin, like increasing glucose. We actually slightly decrease it. HSCRP benefits would be tremendous in this pill. If you look at a lot of the way that physicians are thinking about treatment, these combination pills are becoming much more in vogue, I guess would be the way to think about it. We think this is a way that we can kind of get ahead of that shift in prescribing dynamics and have an option that would be very in line with where the course of treatment is going.
Got it. Okay. So how did you pick the statins that you were moving forward with?
We wanted drugs that would work well together in a pill form, but would also be synergistic with what we have. I'm going to choose my words very closely. We will debut a lot more in the second half of this year, but it was a very concerted effort and well thought through.
Got it. You're also pursuing development in, sorry, familial hypercholesterolemia. Can you just walk us through that rationale? You obviously had some of those patients in the phase three program originally.
Yeah. We are going through our pediatric trial, which is the main driver of that, is that six-month extension at the end with the FDA. We are moving into a phase three. It's progressing along very nicely. We think that that is a real driver of six months at peak revenue, is a big driver value for this company.
A few weeks ago at your R&D Day, Analyst Day, you rolled out a new program in PBC. Can you just give us a little bit of the details there? It's a mechanism clearly you know well and are leveraging, but just help us understand why you chose PBC, what the rationale for the mechanism is.
You're going to make the accountant talk science. That's really good. Yeah, no, we're very excited about this. That R&D Day, I think, was a very big capstone for this company because it's something that we've been talking about for years, but have not been able to talk about externally up to that point. It's something we're very excited about, right? For a bit of context, this is our next generation ATP citrate lyase inhibitor. It is a separate compound altogether from bempedoic acid, ESP-1336. We're looking to pursue in PSC, primary sclerosing cholangitis. Practiced that a lot. It's an area that we're very excited about. There are currently no treatments available for this very, very terrible disease.
I think you heard at the R&D Day, one of the physicians said he has treatments that 25 years ago he had nothing, and now it's basically you give them a pill and they're done. With PSC, it's the exact same conversation as it was 25 years ago. We are very excited about that. We think that this is an area that, again, a very unmet need. We think it's a billion-dollar opportunity, and we are going to continue moving this asset forward. We are currently working on sort of the IND enabling work that needs to happen there. I think if you look at our deck, you have our timeline on there, but we think this could coincide nicely with that 2031 date that I mentioned in terms of being able to launch and have the next step in evolution of Esperion.
Let's get back to a more accounting-focused question. One of the things that you, I think, really were successful at last year was cleaning up the capital structure of the balance sheet. Just walk us through those few transactions and where we sit today.
Yeah. So we entered last year with about $700 million in debt, which was just astronomical, would be the way to put it. We did two, I would say, two tranches of deals, one of which was we monetized a royalty stream with our partner, Daiichi Sankyo, and used that to remove a senior creditor royalty agreement that we had, a royalty purchase agreement. Then later down the line, we had about $265 million in convertible notes that were outstanding, and we were able to refinance 80% of those. Now, rather than having $265 million due in November of this year, it is now deferred down to 2030, I believe is the date. It is a much cleaner story on the capital structure side.
It was a busy year, but I think we really set the stage nicely for being able to just focus on the launch this year and grow this drug and also look at some of the, we mentioned before, we're looking at BD opportunities for how we can add something else in the bag. None of that could have happened with the cap structure we had last year.
Let's talk about that a bit. From a BD perspective, what's your focus? What are your priorities? What would you not touch?
Yeah. Yeah. I mentioned before we have this legitimate organization, a commercial enterprise. There are a lot of companies that could leverage that, right? There are companies that are single product. They are either about to have a PDUFA. They just finished a phase three. They're near commercial, and they don't have the infrastructure needed to launch a drug. There is a lot of synergy that could be had with us and that we already have everything. You have a sales force, you have marketing or compliance, something that a lot of people do not think about. There are a lot of things that need to go behind the scenes. In today's macroeconomic world, to raise money and start a commercial organization would be very difficult. We have been doing a landscape analysis.
We've got a few paths forward, I would say, on drugs that, like I said, are about to launch. They need that commercial infrastructure. What we're looking at is things that I would say cardiometabolic, just because that's where we play, but things that make sense from our call deck. Things either primary care or a cardiologist setting that would make sense from a marketing transition, right? It's hard to go talking about lipids to, yeah, let's talk about asthma now. Let's talk about lipids. Let's talk about heart failure. Let's talk about kidney, liver, a lot of the things that are in a similar setting. That's where we're kind of looking. Something that would make sense from a commercial perspective for us to put in the bag that we could leverage the existing field force for.
Are you open to different structures? Would you consider a co-promote with somebody?
Absolutely. Yeah. Yeah. I mean, I think there's any number of ways we could take this. I think all of it is sort of incremental to what we have. We're looking at things that we wouldn't necessarily need to add a lot to the cost structure to support and could just be an easy top-level grab on like a co-promote or a revenue share and easily sort of combine the two.
Just going back to cash, can you remind us where we are today? You have given expense guidance, so we got a sense there, but just how you think about what the platform needs to do to get on a trajectory to cash flow break even.
Yeah. I think we're in a very good position when it comes to cash, all because of a lot of the work we did last year. I think we ended Q1 with about $114 million. You can see the trajectory that we're on, that sort of net burn every quarter gets less and less as the year goes on. I think we're in a great position on cash. I will also mention another big catalyst for us, the Japanese regulatory process is underway. Associated with that is a number of milestones as they get approval and pricing. We expect that in the second half of the year. That would be another tailwind to get us to that cash flow break even point.
You have the partner in Europe and you've monetized that royalty. There is some backend upside as well potentially, but what about other ex-U.S. geographies and plans there?
Yeah. Japan I mentioned that should launch in the second half of this year. We know it's literally hot off the presses this morning, a partnership with HLS Therapeutics in Canada. They will help us launch in Canada, which I think that also is on track for approval in the second half of this year. That one also has about $50 million in various milestones associated with it. On top of that, we partnered in Israel, Australia. I would say we're actually pretty well set up globally to make sure that bempedoic acid is a strong franchise across the globe.