All right. Good afternoon, everyone. Welcome to the afternoon session at Day Two of the Wainwright Conference. I'm Brandon Folkes , one of the biopharma analysts here. Next up, joining me for a fireside discussion is Milestone Pharmaceuticals, and joining me from the management team at Milestone is Joseph Oliveto, the CEO, and Lorenz Muller, the Chief Commercial Officer. Thank you both for joining me. Joe, I guess, you know, we know the company well, but let's maybe just start with a bit of an introduction, if that's okay, just so that people kind of know the good work that's gone into sort of where we are today.
Okay. Well, first, let me say thank you, Brandon, and thanks to the colleagues at HCW for inviting us. We had a great time at the event last night and full schedule today. So thank you for all the support. So Milestone is focused on our lead asset and lead indication. It's a drug called etripamil, trade name, provisionally approved as Cardamyst, and it's a nasal spray calcium channel blocker for certain types of arrhythmias. SVT is our lead one, of which we're filed with the FDA and expecting an answer from them by the end of the year in mid-December. And the second indication, maybe a little more familiar with folks, is atrial fibrillation. And we've completed a phase two program there and are interested in starting phase three sometime after we get the product launched for SVT.
Fantastic. And you mentioned you've filed with the FDA, you know, that's sort of a response to CRL. So can you just walk us through the interactions you had with the agency ahead of the filing and sort of the confidence you have that you've addressed the issues that they raised?
Yeah, and that's right. We had a PDUFA date in March. We were really quite optimistic about that, but we wound up getting a complete response letter from the agency. It was very focused on a couple of issues around manufacturing. The primary issue was nitrosamines. For those who may be unfamiliar with nitrosamines, they're impurities or potential impurities that come from or could be associated with compounds that essentially have nitrogens in them. And we fall into that class. And the impurity characteristics or guidelines for those nitrosamines change during the review process. So what we did is, after we received the CRL, we went, we met with the agency in June. We understood what was required for the new guidance. We waited for that meeting until we had completed studies that allow us to characterize our compounds and allow for different levels of these nitrosamines.
We submitted those to the agency as part of a briefing package for that meeting. We had the meeting in June, and then coming out of the meeting, we quickly turned around and submitted that very same package for the briefing package for the meeting in the form of a Complete Response Letter, so we feel quite optimistic that we've delivered what the agency needs based on the guidance that we received in that June meeting.
Fantastic. So with that, I'm going to sort of move towards potential launch timing and sort of launch activities. You know, so maybe just starting, you know, straight off the bat, can you just talk about the gating factors, pushes and pulls, post- approval, how quickly you could launch? You know, you did hold a very informative Investor Day, I think it was in February, about sort of your commercial plans. So can you just help us think through sort of what needs to be done post-a pproval before the product gets to market?
Yeah, so I'll take a step back, but certainly think ask Lorenz to really expand on the preparations for this launch and how we're thinking about it. We do feel very bullish on SVT as an opportunity, especially for a smaller company to come to the market. Most people hear cardiovascular, know of the big players there. And we really, Lorenz and team have been on this market for the better part of six or seven years right now. We have a very good grasp of this market. We see this market as two million patients, of which about half of them could be candidates. When we dollarize the potential, we believe, for etripamil for SVT, you know, we come up with numbers in the range of, well, in excess of $500 million, right? So we think there's a big market there.
We've got the work behind it to support that, we believe. And it's a matter of then how do we access that market? And really, that's where I'll turn it over to you to talk about our plans and how to get maybe more specifically to Brandon's question of launch.
Yeah, and maybe just to remind everyone, you know, we think about key stakeholders. So this is primarily a cardiology-driven market. So you've got cardiologists treating an arrhythmia. There's a relatively low bar to prescribing. It's a calcium channel blocker. They've been using this class of drug for 30 years. So we think that's a bit of a tailwind, but also a very focused effort where you don't have to deploy hundreds of reps to get traction in a launch year. We have a motivated group of patients. There's been nothing new for this population in almost 30 years. And so, and it's symptomatic disease. It's something that when it happens, patients want in the majority of cases to do something about it. And payers, uncharacteristically, are supportive as long as we price it rationally. We'll probably talk about that a little later.
They're not encouraged to put a lot of things in our way as long as we do the right thing as we launch. So it's got a lot of tailwinds. And in that environment, we're able to deploy a staged launch, putting, as I mentioned, you know, 50 or 60 reps out there initially, focusing on commercial coverage first, partly because it comes sooner. So our gross-to-net won't be as bad necessarily as when you have to do a lot of, you know, heavy copay mitigation or denial conversions. That's an area we can focus. And that should allow us, with those other tailwinds I mentioned a minute ago, to demonstrate that there's a real market here. And we should be able to do that in a launch year. And then that's just the start.
Then we can grow to a lot of different areas, obviously new indications, but also within PSVT, given that a lot of patients are so dissatisfied with their therapeutic options that they're just in the woodwork, sitting at home, suffering through literally millions of episodes a year without having something that helps them.
Fantastic. And, you know, within that, right, large market opportunity, you talked about focusing on the commercial insurance early on. But you did mention two things, right? And I think one of these is sort of no real innovation in the space for a long time, right? So you are changing a very ingrained prescribing habit. And along with that, sort of patient awareness of this new product that's out there. So can you just talk about sort of how do you go about getting this product in the patient's hands and getting the patient to use it and see, getting the patient to see the results we saw in the clinical trial and trust the product going forward?
So our strategy for patients is to make the drug easy to access and easy to afford. This is not life-threatening disease. So you have to kind of pass those hurdles in order for you to get broad adoption. So we do that. The ease of access is through retail distribution. This is not specialty pharmacy. It's not that kind of a rare disease where you only have a few tens or hundreds of thousands of patients. You heard millions of patients. So we make it available at the retail pharmacy. We distribute it through wholesalers. And then we make it affordable. We make it affordable by focusing on commercial books of business initially, partly because we believe we can get commercial payers through interactions with them to review and cover it more quickly than Medicare, which can take a couple of years sometimes, depending upon the review cycles.
I failed to mention earlier, but this market, unlike other cardiovascular diseases, is sort of 50-50, commercially insured under 65 and Medicare eligible. So the ability to get a patient to pay for it is important. So you have to invest in both tools to make sure that the script that the physician writes actually ends up going to the pharmacy and getting filled. And we can talk about that maybe a little later. But then on the back end, once it gets to the pharmacy and the patient is told, "Hey, it's going to be $200, $400, $600, whatever it could be without the right tools," you're going to lose a lot of fulfillment there. We would have appropriate and compliant copay mitigation, a pay no more than type programs early in a launch where you don't have broad coverage.
You also want to invest in either medical or formulary exception processes so that the scripts actually can get into the pharmacy and invest in the kinds of things you would do normally. We're not doing anything outrageous here. It's just what companies normally do to demonstrate demand early in a launch and then equalize your gross-to-net as you get more to steady state.
Yeah. Great. Just coming back to the clinical data or to the data generated with the trial, because I think this leads into the pricing question, right? Is, you know, you showed that reduction in emergency department visits by quite a significant amount. But can you just talk about your pricing strategy about, you know, there's obviously a lot of value in the product and reducing emergency room visits by that amount. But that said, you also talked about sort of being very rational on pricing and getting that product into the patient's hands. So can you just talk about in a bit more granularity, how you think about that pricing strategy and sort of what do those points lead to in terms of a pricing range?
Yeah, maybe I'll start and let you get to the specifics of the pricing. Foundationally, the value prop for this drug, Cardamyst, is in its clinical benefits to physicians and patients. This is a patient-driven market. This is a disease or condition where they're having highly symptomatic events. And what's very clear from other symptomatic conditions is when you solve that, it's a reinforcement effort for the patient. It's not as if for many cardiovascular conditions where you're intervening now to hopefully prevent an asymptomatic killer from impacting you in 30 years, right? This is here and now. We liken it a lot to pain. In pain indications, drugs that do well quickly are used often again, right? Because it's immediate fulfillment of a problem being solved. We have that component here. The emergency department offset is important because the options available to these patients are not great right now.
There's nothing approved for sure and very little available to patients when they're in an event. If it were to happen to you right now, if you really needed to get rid of this event, the intervention is somewhere down one of these streets at an emergency department. It's an IV drug. It's very uncomfortable, and that's on top of getting there, waiting, dealing with the stress, and then paying for it. So that is, I would say, a secondary value to the foundation of solving the problem in the moment. And what's important is when patients come in and they deal with all that and they know that that's the issue, the alternative is to wait these out. So that's the point about Lorenz made before. There are actually millions of patients that are just, we call them in the woodwork.
They've gotten out of the system because there's nothing else available to them. The ability for this drug to do well is to reach those patients that are dealing with episodes now, trying to make decisions as to how to handle this and for Cardamyst to be an option for them, and down the road, we'll pull the other patients in. Lastly, and then I'll let you get to the pricing per se. When you go to the emergency department and the bill, average emergency department bill is kind of around $3,000-$4,000. What we've recently published on is that between one quarter and one third of patients, 25%-30% of patients are actually being admitted for overnight stays. That turns it into tens of thousands of dollars, you know, between $10,000 and $20,000 on average. So that offsets the value prop.
Where we think that helps a lot is no one wants to go to the emergency department unless they have to. That's an appeal to the patient and the physician. This cost benefit is really helping support the payers to not really want to overly manage it. Again, it doesn't drive them. In the world of most pharmaceuticals, cost additive, this is certainly a cost offset that's important to the foundational pricing.
It resonates with payers. We've done lots and lots of PIE, pre-approval information exchange presentations, and presented budget impact models to all the payers you'd expect us to be talking to. It's connecting with them. They understand the value. A lot of that's driven, to your point earlier about the copay, the offsets of emergency department visits. To answer your question about pricing, it brings me back to the access strategy, which is broad, affordable access to the product for patients. Price is simply a tool to implement an access strategy. If that's our access strategy, we want that because we want patients to be able to use it whenever and whenever they want to and wherever they want to. That means they have to be able to afford it.
So that means tier two or tier three preferred brand or non-preferred brand copays, $30-$50 on the commercial side, $50-$80 on the Medicare side. Remember, Medicare is not unimportant, just not necessarily in the launch year. So in order to achieve that access strategy, we have to have a price for some idiosyncrasies around Medicare and what they will allow, above which they will put it into specialty tier. Specialty tier is mostly co-insurance, which is hundreds of dollars, which is not going to be affordable by Medicare patients. So you've got to think about your commercial pricing strategy and your Medicare strategy to make sure you don't get out of sync.
For us, the bottom line is we think we can charge or deliver a net sales price that's net to us, not net to the payer, of somewhere between $500 and $1,000 per prescription. That's in a launch year. So if you want to, you know, pick a number, $750 in the middle, you can dollarize our volume at that number. We will obviously set a WAC that's higher than that, take into account distribution costs, copay mitigation, rebates, which in passing, I'll say, are going to be nominal to modest because there's no competitive pressure. There's nothing forcing us like in migraine or in oral anticoagulants to compete, you know, to fight with somebody to the bottom.
Great. And, you know, it is still a drug launch though, right? And so that stuff does take time to implement. So can you just talk about any sort of assistance programs you anticipate in the first year, how we should think about sort of access to medication, how you support that in the first year? You know, I guess when I think about this drug, right, it's keeping people out of the emergency room, patient administered. So maybe just, and we've talked a lot about the efficacy, right? What about safety, right, given it's patient-delivered? And how do you get that into the patient's hands early on in the launch? And how do you convince them to trust the product?
Yeah, I'll start. But again, I'll ask Lorenz to provide some of the details that we provided in that commercial day. Foundationally, the message for this product is a simple one. This is a calcium channel blocker that's very well understood by cardiologists to work in this area. IV calcium channel blockers work. When you look at our PK curve, it looks like an IV drug. It's in a convenient patient-oriented spray. And what we hear is this should work. We have the data now to show that it does. Let's hope the FDA agrees and approves it. And foundationally, doctors rely on data to make decisions. The comfort of the mechanism plus the data, we think, provides a very low bar for doctors wanting to try it. And what's foundational to that is they really don't have good options right now, and we're providing a safe option.
Safety is key, and our safety profile is essentially four or five tolerability descriptions of nasal irritation or some form of that, so that's a very attractive profile for someone to try, and what we've seen in our clinical trials is that patients who have a good experience with it will want to continue to use it. We've seen it in repeat dose trials that we've run, expanded access programs, and open-label safety studies, so it is, you're exactly right, Brandon. It is about trial, having good experience, and then the built-in multipliers for us, what's the hard part for us when we try to think about the size of this market? How often will a patient have an event? How often will they use it? Will they have it with them?
We have a lot of data to triangulate on that, but we'll know once we get into the market. But what is very well understood is a good experience will lead to other experiences. And a built-in multiplier for this drug of over time, as refills become more important part of the sales of the product, you almost have a built-in kink to that curve. As Medicare comes on, you'll have new patients and then refills coming on later. So you can think of it as a lag compared to a chronic oral, for example. But I view it as a multiplier because the other thing we have is with a symptomatic condition, you don't have falloff as much as you do with chronic orals for non-symptomatic conditions.
So long story short, that's a lot of how we think about this being a patient-oriented market that's really driven towards low bar for prescribers to trial and let the patient have the good experience to build refills.
And to me, the whole exercise in the launch year is really twofold in terms of being successful. One, generate demand. So get a sales force out there, get them in front of the right doctors, get them to be aware, and then trial. So write the script. So that's good, but not the end game because that script doesn't necessarily show up in IQVIA data down the road, right? You also have to make sure that that script shows up at the pharmacy and is filled, right? So the investments you're talking about are really around initially, so I'll say ahead of broad coverage, you've got medical exceptions. Most of the scripts are going to be medical exception, formulary exception.
You have to invest in the tools so that doctors' offices that aren't set up to do prior auths, they can call CoverMyMeds PA Plus or whatever the tool is that we invest in to be able to quickly fill the paperwork, sign it, send it in, get the medical exception, and then get it to the patient. The second piece is when the patient shows up at the pharmacy, you know, they have to be able to afford it. There we would have, there's a lot of tools now that the pharma industry has, from electronic copay mitigation to actual physical cards to different ways, even up to including if they're denied that initial exception to do some denial conversion, because we want to demonstrate there's real demand there, because that will ironically also drive coverage down the road, right?
Those are really the two pieces we invest in. And there's a number of tools that we would use. I want to emphasize just in passing, this isn't like full-on hub support and everything you would do for a specialty drug because we're retail and because of the way we're pricing it and because of the size of the market. We don't need to invest in that kind of stuff. We just more put together a constellation of services that over time, as we get broad coverage, we can pull back on because we don't need it anymore. And that helps our gross-to-net.
Fantastic. We are out of time. Joe, Lorenz, thank you very much for joining us and all the best with the rest of the conference.
All right. Thank you so much, Brandon.