Good morning. Welcome to the H.C. Wainwright's Second Annual BioConnect Investor Conference at Nasdaq. My name is Oren Livnat, Specialty Pharmaceuticals Analyst here at H.C. Wainwright. It's my pleasure to welcome for a brief chat today, Zevra Therapeutics, and with us today is President and CEO, Neil McFarlane. Welcome, Neil.
Good morning.
So I have covered this company for about five years now, and it's gone through a pretty radical transformation, both in business model, identity. You took the helm, I think, about seven months ago as well, and it's a really pivotal time, really exciting right now for the next few months for the company especially. So hopefully you can tell us how we got here and where we're going in the near future. So I guess for those unfamiliar with the story, just can you give a brief overview of Zevra's strategy, you know, what you're most excited about right now?
Yeah. Thank you, Oren, and, thanks for having us today. Let me start by saying I'm gonna make some forward-looking statements and, take a look at our SEC filing before we get started. To answer your question, the company's had quite a transformation. A few years ago, it decided to be able to pivot to the rare disease space. With that pivot, came an acquisition, came a name change, and then came another acquisition. As part of that, it now sets us up to be a commercial stage, rare disease company with a very exciting pipeline, solely focused on making an impact in the lives of patients, with rare diseases. Along that line, and I'll maybe just elaborate a little bit more.
We've put together a team of people who are company builders, who are entrepreneurs, who are solid scientists, to be able to go after what we think is still high unmet need in not just rare diseases, but in the specialty areas in which we're focused in. So with that in mind, we're looking forward to having a conversation today about the rest of the portfolio and this pivot.
Right. So you are suddenly a commercial stage company. You are launching right now, OLPRUVA, an ultra-rare UCD indication. Can you talk about that product's differentiation, the early feedback you're getting in the field from physicians regarding awareness, and maybe, you know, initial interest in the product profile?
Sure. So you're right. We were thrusted into commercialization by design. We had acquired a company last year that had an approved product for urea, certain urea cycle disorders. I won't spend too much time because we only got a short time here today. Urea cycle disorders are breakdown in the enzymatic process in the urea cycle that allows you to have increases in ammonia, and you can have hyperammonemic crisis. There are a number of nitrogen scavengers on the market today, mostly phenylbutyrates, in general. The marketplace is about $400 million. It's dominated by one glycerol phenylbutyrate and multiple sodium phenylbutyrates that are on the market.
OLPRUVA was built and designed to really be able to address the large unmet need that still exists, which is 25% of the patients that of the 1,000 or so in the United States that have UCD, still have breakthrough hyperammonemic crisis. And with that, it has a lot to do with compliance, where patients have a really hard time with the smell, the taste, the odor, the viscosity, what have you. That compliance just becomes a real issue for these patients. OLPRUVA was developed to be able to be taste-masked, to be able to be put into liquid that you can drink, that that has a more palatable, it's portable, it has small packages, sachets that you can bring and move forward with.
Those clinical differentiators that we have, we hope will actually improve the overall compliance of patients that are in this 25% of the patient population today that still needs it. The product was approved about a year ago and became commercially available at the end of last year. However, there was no awareness being built. The company had financial challenges that didn't allow them to be able to get boots on the ground and really get out there with physicians, patients, payers, and drive the message of this differentiated product.
So when we closed the deal in November, we quickly had and took the talent that we could from the previous company, and actually drive to hiring our full commercial organization, sales, medical affairs, patient services, inside sales, across the board, to be able to, in 6-8 weeks, hire really talented people with deep, deep experience in the ultra-rare disease space, which I'll talk a little bit more about in a minute. And these folks hit the ground at the end of January and truly started the launch of OLPRUVA. In our Q1 call that happened a few weeks ago, we talked about what has taken place since launch.
We came from a very low awareness, which we knew going into the acquisition, but we've been able to, with this, the depth of talent, kind of hit 90% of those 40 centers of excellence as the experts in those areas, and actually call on those folks in the first few months of with launch. As you know, in this space, access to physicians, access to facilities is very challenging and continues to be challenging. That was really one of the areas on why we wanted to make sure that we hired the very best talent that we could, and they clearly are delivering on that today. We also had market access. It was about 50% or so when we took it over for, you know, covered lives, both on the government and commercial payer side.
We were able to increase that as of May first, up to about 75%. So we're making progress there as well. And we mentioned on our Q1 call that we had four patient enrollments that we also brought on board in the first few months of launch. So we're on our way, increasing awareness and competing in a place where we've been able to level set the playing ground for market access.
Hub services, access, getting patients onto therapy is always, you know, the main challenge in the rare disease space. You know, how should we think about enrollments translating to paid patients on therapy? You know, where is it tracking versus your initial estimates? Are we seeing acceleration, you know, with more weeks of boots on the ground?
Yeah. So early-
Yeah
... is what I would say into the launch of a product that had very low awareness. We are seeing and have seen patients coming into the funnel. We define an enrollment as a patient that's eligible for a benefits investigation or eligible for a quick start program. And part of this quick start program, we saw right off the bat, physicians didn't know who Zevra was, 'cause Zevra has only been around for a year. Right.
Physicians didn't even know OLPRUVA. A lot of physicians didn't even know OLPRUVA was being developed and had these clinical benefits and differentiators for their patients. So, we initiated that. We're driving through that. The sales force is delivering on that right now, so it's a little too early to tell you, but we are continuing to see enrollments continuing to progress. But the other component of this that is important is patient... This is a mature market. Patients who are on product and stable may only see their physicians every 6-12 months.
Right.
We have to do what we can to again, go after that 25% of the patient population that is having these hyperammonemic crisis on a regular basis and share that there is a differentiated product out there.
All right. Given the time, I want to pivot to arimoclomol, right? That's what I'm most excited about, for now, and I'm just really curious. But first, just give us a very quick overview of the opportunity in NPC, in terms of the size of the market, and, you know, the level of interest out there in the space, and then we'll dig further in.
Yeah. So Niemann-Pick C is a devastating disease, and it's a lysosomal storage disorder that you get a buildup of cholesterol in the cells, and those cells die. And, as you know, a lot of cholesterol and fat is in your brain, and you have a lot of motor movements, swallowing challenges, cognition challenges that are really impacting the lives of these folks. The average age of death is 13 years old. Arimoclomol has been developed and to be able to improve the metabolism of cholesterol inside the lysosome. We have phase III data that shows that it works. We've kind of driven through that process. We'll maybe get into a little bit more of that.
We are really excited about it, too, because it's a product that now has had a lot more maturing data since the original filing and the CRL, which we then answered, kind of the due date of September twenty-first. And they intend, the agency intends to bring us to an AdCom. Now, all that being said, I think we started with OLPRUVA because the commercial infrastructure and medical affairs infrastructure and payer infrastructure that we built was built also for the launch of arimoclomol. Arimoclomol, and today, our medical affairs reps are on... Our medical affairs medical science liaisons are on the ground today actually educating physicians on Niemann-Pick C. Our market access folks are giving presentations on Niemann-Pick C and the potential for an arimoclomol as we move forward.
So this investment we've made in OLPRUVA is actually, overlapping and already invested in for arimoclomol. So we're really excited, too. Feedback has been great, so far, and I might just add one thing, which is that OLPRUVA, you know, this is 300 and this is 800 patients in the U.S., 900 patients in the U.S. About 350 of them are on some type of treatment today. We have an expanded access program with 70 of those patients inside and have been treated with arimoclomol for some time. We just presented data at SIMD in adult patients in the U.S. that had 2 years of stability with the treatment of arimoclomol. And all of that excitement is really underpinned by a patient community. And that patient community's...
You know, we had about 6 of these patient advocacy organizations come together and put an informal petition to the agency that had almost 1,000 signatures of patients, some of them on arimoclomol, of physicians, of family members, of caregivers, you know, also supporting arimoclomol's review with the agency that we feel very, very blessed to have.
So I'm sure all of that will carry momentum into an expected AdCom, which I guess we should be hearing, you know, keeping our eyes open any day for news, announcing. But just to step back, you know, you acquired this product in the registrational phase, I guess, which is pretty uncommon. And so can you just talk about the evolution of the filing and what Zevra brought to the table to sort of get it up to snuff, so to speak? And, you know, with the three-month extension, which you didn't mention, from June to September, PDUFA date, relatively recently, I think that was in March.
Yeah.
Can you just talk about what we can or can't infer from that move with regards to maybe the FDA's disposition towards this application, and, you know, based on data you submitted more recently?
All right, I'm gonna try to take those one at a time, and if I miss one, help me out. So the evolution of the program was that it had a CRL a couple of years ago under the previous management. And when we acquired the asset, we really relied on the fact that we had competencies within the organization, high level of competency within the organization, had worked through regulatory challenges and worked through multiple CRLs to then gain approval for products. So the bet was on us, on the people that we have, to be able to drive. What the diligence we did was that we felt we could address the three areas of the CRL, which we have been able to do based on the fact that we got a PDUFA date.
Those issues that were raised in the CRL and then submitted in December. I won't, maybe we don't have time to get into all of the various levels of the areas, but having the PDUFA date means we answered it, 'cause it could have given us another CRL. The other component of this is that the agency never asked for a new study, and I think that's a critical component as well. What we did do as part of the last few years was answer the question in regards to the scale. We have a five-point scale, the Niemann-Pick C severity scale. That had a five-point scale. It was down to a four-point scale, and so the revised four-point scale, cognition was removed, and we rescored swallowing.
We did do that work that then showed similar data to the original package. Also, what to do with missing data. We did the FDA preferred analysis and showed very similar outcomes. And then a lot of the work we did was in the preclinical stage, to be able to get the biologic plausibility of arimoclomol and connect it to the single phase III study in rare disease that you do and the data that we got. So we did some additional work in the preclinical setting.
We actually submitted longer-term, 4-year open-label extension data for patients who had been in the program, and then also the natural history data that was now more robust, and then both delivering that and the confirmatory evidence train directly to the study that we originally did and the data that we got out of it.
All right, so, you know, things are coming to a head pretty quickly here. Assuming things go well at both the AdCom and in September at this PDUFA date, first, can you just confirm, are you certainly getting, if this is approved, a priority review voucher? I guess, as we think about the potential disconnect in valuation between, that value and where your market cap is now. And, then can you just characterize the level of excitement in the field, and anticipation and awareness of arimoclomol?
So the awareness is incredibly high. Unlike that, OLPRUVA, arimoclomol is in a different, different stratosphere.
Yeah.
The patient advocacy organizations, the patients, we, we have a, a very, very deep bench, in that regard. In regards to the PRV, yes, we have had a number of conversations with regulatory folks, legal folks, what have you. With an approval, we will be eligible for the PRV. I think you might have asked, what are the average PRVs?
Yeah, yeah, just the value.
You know, we have seen them. I think the most recent one sold for $105 million. So an average about $100 million non-dilutived capital that we would have at our disposal with the sale-
Right
-of the PRV.
I guess just when we think about the launch, right, so OLPRUVA is one kind of launch, just sort of building awareness from the ground up. Arimoclomol, you mentioned earlier, you have an EAP program, expanded access. So I guess how, how should we think about how fast you can hit the ground running, given all this infrastructure you've put into place recently, and, and importantly, can, you know, finding and converting this large installed base that you already have onto paid therapy?
Yeah, that's, that's part of the investment that we pulled forward for the launch into arimoclomol, launch into OLPRUVA. We obviously, we know that we've got 70 patients that are in the United States in the EAP program. We also have another 70-80 patients in Europe as well. But in terms of the current launch, we feel like we'll be able to profile, help with the patient community to be able to get those EAP programs, patients converted over time after launch. Now, the other component of this is that the EAP program is only in about 15 centers in the US of the 40 centers of excellence today. So we need to make sure that...
Our goal is to be able to make sure that we provide access to every patient that has a Niemann-Pick C diagnosis and can benefit from arimoclomol. So our guys are on the ground now, profiling those accounts, understanding what the payer dynamics are in those accounts, understanding how we're gonna be able to drive the education of a product that, and as you see in rare diseases and throughout my career, once you get a approved product for a disease, all of a sudden, more diagnosis happens with that disease 'cause you have physicians who are now educated and understanding that there's something they can treat the patients with.
We feel like we're doing all the pre-launch activities, all the medical affairs things in the most compliant way we can, to drive and know where the rest of those patients are and have access available to them as soon as possible.
So I know it's early and probably premature, and you can tell me no, but are you comfortable talking about, potential ultra-orphan pricing ranges or value per patient in this space as you imagine it? And given the size of this market, nothing approved, what kind of peak potential investors should be thinking about here?
It's too early.
Yeah.
That being said, the opportunity for us is to make this product available to everybody. The ability for us to be able to compete in the space. There are other symptomatic products that are utilized today for this heterogeneous disease in Niemann-Pick C. Some of them that are utilized off-label have up to a generic price of $500,000 per year patient today. You know, based on our labeling discussions that we will have, you know, later in the process and we get that labeling discussion, we would absolutely see that the value of our, you know, first-in-class cornerstone and foundational therapy for disease-modifying therapy would be north of that.
Got it. We don't have a lot of time left, and I hate to give your pipeline short shrift in addition to what we've talked about, but KP1077, something you guys have been talking about for a while, that's your, you know, your legacy, serdexmethylphenidate prodrug for IH, idiopathic hypersomnia and narcolepsy. Just quickly, can you just tell us what sort of data people should be excited about at the June sleep meeting coming up, how that might differentiate you in the space, and just timelines in general as we start thinking about when I need to start paying more attention to this product?
... Great.
-going forward?
Well, we appreciate you paying attention now. Our phase II study data will be presented at Sleep in the first week of June.
Yeah.
We are actually announced on our earnings call a week or so ago that, we're taking that data and showing it to both physicians and patients. It's just ongoing, help us inform a phase three, which we had planned to have an end of phase two meeting at the, in Q3, and the phase two meeting in Q3.
When we think about just timelines in this space, how long it takes to develop something in IH based on the experience of other players, you know, what timeframe, if everything goes well, could this thing potentially come to market? I know it's quite early.
I can't tell you that until we understand what size trial. What I can tell you, though, is, is that, we were able to enroll this study, in IH patients, diagnose IH patients, and, deliver it, and then absolutely actually deliver our, our phase two results a quarter early. So we know what we're doing in the IH space and feel like we can actually execute.
Okay. Just lastly, as we approach time here, just remind investors, you know, where your balance sheet stands now. Talk about your runway to support the ongoing launches and your planned development, you know, runway, and whether that with and without the PRV, obviously-
Yeah
... and any debt facility you might have to help along the way.
Great. I realize we're running short here, but we did close a debt facility and cleaned up our shorter term maturity debt with HCR as well as Perceptive, $100 million facility. We took down $60 million. We have two $20 million tranches in the event that we'd like to take down more. So we sit with $60 million in debt today. And on our Q1 call, we mentioned that we have cash out to 2025, 2026, I think, further in 2026 is the words that we utilized. And that is without actually a PRV. That is without our molecule. So we're taking a conservative approach to being able to bring our cash runway into 2025-
Okay
-six.
I think that's time. I guess if there's a question, probably a couple of minutes over- Yeah.
If anyone has a question in the room, but if not, you know, we can wrap it here. Anybody? All right. Don't be shy, but no, I appreciate you coming. This is gonna be really exciting in the next few months. So a lot of eyes are gonna be on you guys, and I wish you luck.
Thank you. Appreciate it.
All right. Thanks for coming.