Good day, and thank you for standing by, and welcome to the Kiniksa Pharmaceuticals First Quarter 2023 Earnings Conference Call. At this time, all participants are in a listen-only mode. After the speaker's presentation, there will be a question-and-answer session. To ask a question during the session, you will need to press star one one on your telephone. You will then hear an automated message advising your hand is raised. To withdraw your question, please press star one one again, and please be advised that today's conference is being recorded. I would now like to hand the conference over to your speaker today, Rachel Frank, Head Investor Relations. Please go ahead.
Thank you, operator. Good morning, everyone, and thank you for joining Kiniksa's call to discuss our first quarter 2023 financial results and recent portfolio execution. A press release highlighting these results can be found on our website under the Investors and Media section. As for the agenda, our Chief Executive Officer, Sanj K. Patel, will start with an introduction. Ross Moat, our Chief Commercial Officer, will provide an update on our ARCALYST commercial execution. Then Mark Ragosa, our Chief Financial Officer, will review our first quarter 2023 financial results. Finally, Sanj will return for closing remarks and to kick off the Q&A session for which Eben Tessari, our Chief Operating Officer, and John Paolini, our Chief Medical Officer, will also be on the line.
Before getting started, please note that we will be making forward-looking statements today that are subject to risks and uncertainties that may cause actual results to differ materially from these statements. A review of such statements and risk factors can be found on this slide as well as under the caption Risk Factors contained in our SEC filings. These statements speak only as of the date of this presentation. We undertake no obligation to update such statements except as required by law. With that, I will turn it over to Sanj.
Thanks, Rachel. Good morning, everyone. I'm happy to review our first quarter 2023 financial results today. We have continued to execute across our cardiovascular and autoimmune franchises, which positions us for success and growth in 2023. On the commercial side, Q1 represented another quarter of growth for ARCALYST with a net product revenue of $42.7 million. We are encouraged by our commercial execution to date and with recent increased prescriber adoption and patient enrollments, we're seeing clear signs of success from our field team expansion. We've also continued to see high patient satisfaction, strong payer approval rates, as well as longer duration of therapy. With that in mind, we have raised our 2023 expected ARCALYST guidance range to $200 million-$215 million.
We also remain focused on building the maximum value across our portfolio of clinical stage assets, and that includes KPL-404, which is our CD40 antagonist program. We're currently enrolling the third and final cohort of our phase II study in rheumatoid arthritis which is designed to evaluate the efficacy, dose response, PK, and safety of chronic SubQ dosing over a duration of 12 weeks. We expect data from this study in the first half of next year. Additionally, we continue to pursue collaborative study agreements with mavrilimumab to evaluate its potential in rare cardiovascular diseases. This is a molecule that we continue to be excited about, and it has the potential to impact a number of diseases. With that, I'll turn it over to Ross to review our commercial execution for ARCALYST. Ross?
Thank you, Sanj. ARCALYST has now been on the market for two years. I'm delighted to share further details on our first-quarter 2023 commercial performance and our plans for continued growth in recurrent pericarditis. We've been very encouraged by the meaningful acceleration in Q1 in both total and repeat prescribers, in large part due to our expanded field force. Total prescribers since the launch of ARCALYST in recurrent pericarditis are now in excess of 1,000, which is a growth of more than 200 versus Q4 and is the largest jump we've seen to date. Additionally, repeat prescribers grew to 23% off the much larger total prescriber base. The underlying patient growth seen in Q1 drove a net revenue of $42.7 million, representing approximately 7% growth versus the prior quarter.
Our revenue growth is despite the Q1 seasonal-related impacts to insurance plan changes and resets of copays, which are very typical for specialty drugs in the first quarter of the year. These impacts resulted in a gross-to-net of 10.7%, which is higher than in prior quarters. In addition to growing prescriber adoption, we're also continuing to see high reported prescriber and patient satisfaction and strong compliance and adherence when patients are on therapy. I'll also highlight that the payer approval rate in Q1 remains greater than 90% of all completed cases as it has been every single quarter since launch. Moving to slide eight. Our commercial launch is focused on building the market and establishing ARCALYST as the standard of care in recurrent pericarditis. In the two years since launch, we've gained several insights which have helped inform our tactics.
Some of those learnings led to the expansion of our field team from around 30 to around 50 representatives during Q4 of 2022. I'm pleased to share that in the early days of this expansion, our field team are executing well. So far, we're seeing a significant jump in total activity and increased reach and frequency with our target doctors. As a result of those metrics, we're seeing an acceleration in the total prescriber base and a more meaningful jump in overall patient enrollments than we've previously seen. We believe these are all early indications of the type of impact we need to be making in the marketplace to continue to advance our business and help many more patients suffering from this debilitating disease.
In addition to the efforts of our sales team, there is increase in interest as a growing number of both private and academic institutions across the U.S. to build their own referral networks and to streamline patient access to centers and healthcare professionals who focus on the treatments of pericardial diseases, in particular, recurrent pericarditis. We believe this growth in expertise specific to recurrent pericarditis will help improve patient care in the future. Additionally, we're continuing to make inroads into digital marketing, having built a database of approximately 4,500 pericarditis patients and caregivers where we're advancing education so patients can self-advocate for ARCALYST when appropriate. Into slide nine, I'd like to provide an update on duration of therapy. As we follow more patients over longer periods of time in the commercial setting, we've seen an evolving picture in the average total duration of therapy.
We had previously seen an average of approximately 18 months. Now with the latest data, we've seen an increase to approximately 20 months. What we're currently seeing is patients are initially staying on treatment for around 14 months before trialing a stop. This is an increase of two months over what we saw at the end of Q4. Once patients stop treatment, given the persistence of the disease, many are seeing an unmasking of the disease with a return of symptoms till they restart ARCALYST. In fact, approximately 45% of all patients who stop ARCALYST go on to restart, the vast majority within eight weeks of the stop.
These factors will continue to evolve the total duration of treatment, and our efforts are placed on educating physicians and patients on the natural history of the disease, which is a median of three years, and that continued treatment with ARCALYST results in continued treatment response. We continue to be delighted with our ongoing commercialization efforts, including the early results from our expanded field team. These results, along with the feedback that we're getting from physicians and patients, the growth in the prescriber rate, the strong payer approval dynamics, and the growth in total duration of therapy, mean that today we're increasing our 2023 ARCALYST sales guidance from a range of $190 million-$205 million to $200 million-$215 million.
We continue to have a growing profitable collaboration with ARCALYST, as well as a significant opportunity ahead as we build and develop the marketplace. Two years post-approval, we are in a brilliant condition. With that said, we're highly ambitious, and we now continue to do what we do best, which is driving the opportunity and solidly executing to grow our business and help patients. I'll now hand over to Mark to cover our financial results. Mark.
Thanks, Ross. Good morning, everyone. Our detailed first quarter 2023 financial results can be found in the press release we issued earlier today. I'd like to call your attention to a few items on this slide, as well as review our 2023 ARCALYST net product revenue guidance. First, total revenue in the first quarter of 2023 was $48.3 million, compared to $32.2 million in the first quarter of 2022. Total revenue in the first quarter of 2023 included ARCALYST net product revenue of $42.7 million, in collaboration revenue of $5.7 million from our vixarelimab global license agreement with Genentech. To date, we have recognized close to $94 million of the $100 million in upfront and near-term supply payments received from Genentech.
We expect to recognize the balance over the course of the next year. Second, ARCALYST collaboration operating profit continued to grow in the first quarter of 2023. It was $16.6 million compared to $4.5 million in the first quarter of 2022. Third, Kiniksa's net loss in the first quarter of 2023 was $12.3 million compared to $25.2 million in the first quarter of 2022. Fourth, we received a $20 million supply-related milestone from Genentech in the first quarter. This inflow limited our net cash burn to approximately $3 million and brought our end-of-period cash balance to $187.5 million. Importantly, these reserves, as well as continued ARCALYST commercial execution, are expected to fund our current operating plan into at least 2026.
Lastly, turning to our financial guidance. With an uptick in enrollment in new-to-brand patients from the recent sales force expansion, as well as slightly longer average duration of therapy, we now expect 2023 ARCALYST net product revenue of between $200 million and $215 million. This represents close to 70% year-over-year net product revenue growth at the midpoint and reflects our expectation for continued execution against our opportunity to help recurrent pericarditis patients by reshaping the treatment paradigm with ARCALYST. With that, I'll turn the call back to Sanj for closing remarks.
Thanks, Mark. As you've heard today from the team, there's a lot to be excited about in terms of the summary. In addition to our successful commercialization of ARCALYST, we also have a pipeline of mid-stage clinical programs that are aimed at making a meaningful impact on patient lives. As a reminder, we're rolling in the third and final cohort of the phase II study at KPL-404 in rheumatoid arthritis. That data is expected in the first half of next year. Importantly, as Mark just reviewed, we are well capitalized. Thanks to those growing ARCALYST revenues, non-diluted capital from strategic out-licensing transactions, and our continued financial discipline. We now, as Mark said, have our expected cash runway into at least 2026. Ultimately, our mission is to continue to help patients in need, create massive value, and make a generational impact.
We believe we are strategically positioned to do exactly that. I do wanna thank you all for your time today. I'm gonna hand it back to the operator for the Q&A session. Thank you.
Thank you so much. As a reminder to ask a question, please press star one one on your telephone keypad and wait for your name to be announced. Your first question comes from the line of Paul Choi of Goldman Sachs. Your line is now open.
Thank you. Good morning, and congratulations on the quarter. One clinical question to start maybe for John, which is, as you look at the landscape in RA and the 404, CD40, program, which you're now enrolling the, you know, next cohort on, how do you think about what you'd like to see with regard to, you know, potential disease activity scores, as the top-line data here? You know, what would sort of be the, data you'd look for to think about a go forward decision, on your phase II?
My second question for either Sanj or Eben is, you know, as you survey the landscape for assets, you know, what are your thoughts on valuations for assets that could either fit into either the cardiovascular or II space that would be, you know, potentially synergistic with your commercial and or R&D efforts?
Sure. good morning, Paul, and thank you so much for the question. Regarding the expectations, if you will, for the phase II study that's going on now in rheumatoid arthritis with KPL-404, what we like about this program is that there's a lot of external proof of concept, if you will, benchmarks in this disease area as well as with this particular pathway of blocking the CD40, CD154 costimulatory interaction.
you know, we've looked at, you know, those benchmarks, if you will, as a way of positioning the size of the study, which as you know, in the parallel design group, which is going on right now, is really testing the efficacy of the very, essentially very practical 5 mg/kg subcutaneous dose administered either biweekly, versus placebo, and then asking the question whether 5 mg/kg administered weekly achieving higher plasma concentrations in the model, you know, it delivers even more efficacy.
Our intention is to then compare that against those established benchmarks, whether those are other assets in the rheumatoid arthritis space, where I think the reductions in DAS28-CRP, as well as attainment of low or no disease activity with the DAS28 score, are really well established benchmarks in the disease without going into specific numbers. Similarly, we can also look at the two, if you will, assets that are in that space as well, one CD40 asset and one CD154 targeting asset, and those also have some established benchmarks. We'll be looking at that, and then, but most importantly, really focusing on our own asset and testing, you know, how it is delivering using that practical subcutaneous dose.
In terms of BD, Paul, we continue to be very active, highly active, in fact. you know, we've got a very strong team under Eben, looking at a number of opportunities. As you can imagine, there are quite a few things for us to look at right now, and we do believe there are opportunities that could add substantial value, but our bar remains very high. We'll be very discerning as we have been to date. To the extent that we do find something that's tangible, both scientifically and commercially, then we'll obviously elucidate at that point.
Okay, thanks. I'll hop back in queue.
Thank you so much. Your next question comes from the line of Geoff Meacham of Bank of America. Your line is now open.
Great. Thanks. Hey, guys. Good morning. Thanks for the question. Just had a few. The first is when you look at ARCALYST' duration of therapy, you guys gave some stats on patients who have restarted after discontinuation. The question is, are there themes in why a patient would discontinue and, you know, obviously there's a benefit from keeping them on, but I'm wondering if there's an effort there to retain patients that initially start therapy? You know, just another one on 404. Talk a little bit about, you know, how you see the, kind of the investments needed here to get to, you know, perhaps the next step.
Is there a scenario that you could sort of co-develop some indications or some geographies and still retain, you know, broader rights? Thank you.
Yeah. Hi, Geoff. Thanks for the question. This is Ross. Maybe I'll make a start on the first part, which is around the duration, which, as we said in the prepared remarks, that we've seen a growth in the duration, elongation of the duration, through to around 20 months in total for patients now. In terms of the restart rates, that's remained pretty consistent over the last couple of quarters at around 45% of patients who have stopped that have eventually gone back onto therapy. The vast majority of those are within eight weeks of stopping. But of course, some patients do stop and kind of go through to several months and then, you know, probably have a flare again and go back on onto treatment.
There's not really any correlation right now. Bear in mind, the numbers are still reasonably small and data builds over time in terms of which patients are stopping therapy and which ones are then restarting. Ultimately it comes down to a judgment from the physician and the patients on how long they've suffered with recurrent pericarditis as a disease, which of course fluctuates against the time in which they start ARCALYST treatments as well.
Ultimately, you know, that judgment from the physician based upon, you know, either the patient's baseline characteristics, how long they've suffered from, how many flares they've had or the cadence of those flares have been, or, you know, informed through, you know, cardiac MRI imaging, for example, looking for whether there's underlying autoinflammation still present within the patient or not before trialing or stop. I think there are multiple factors there that go into making that judgment call. I guess it's positive to know that, you know, when patients do stop therapy, that they do have ARCALYST there as a safety net to be able to go back onto therapy. That's well proven that they go under control again, very quickly and continuous treatment results in continuous treatment response.
Our focus really is on the education for physicians and for patients around the tenacity of the disease and how long it can persist. You know, we don't want patients, you know, going back and having to restart therapy because they've suffered a flare. Again, we want treatment throughout the course of the disease and adequately treated throughout the entire duration. It's an evolving picture at this point.
All right. Well, thank you.
Jeff, on the 404 .
I'm sorry. Go ahead, presenters.
Sorry, Jeff. Repeat the second the second part of your question.
Yeah. The other question is just on KPL-404. Obviously a pretty robust, you know, marketplace, in I and I, but is there a scenario maybe where you know, co-develop some indications, some geographies? Just wanted to get kind of the strategy there with respect to maximizing the value of the asset.
Yeah. No, that's a great question. It really depends on the data, you know, the results. I mean, we're certainly open to it. You know, I think you've seen that we're open to sort of creative collaborative deals in the past. At the same time, you know, if the results are, you know, excellent and we really believe there's an opportunity for us to do go it alone and create more value ourselves and capture all of the value or at least most of the value, then we're more than happy to do that as well. I think you've seen that we can commercialize and execute as well as develop. I think that's important to take in mind. I think we'll look at all options available, determine which one brings us the most value, and then go from there. It's certainly an option.
Okay, thanks.
Thank you so much. There are no further questions. I would now like to turn the conference back to Sanj Patel, Chief Executive Officer.
No, great. Thank you, everybody, for the questions and joining us on the call today. We clearly have an exciting year ahead of us and very much looking forward to providing additional updates in the future. With that, have a great day. Thank you.
This concludes today's conference call. Thank you for participating. You may now disconnect.