Earnings call transcript Q2 2023

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Operator

Good day, and thank you for standing by. Welcome to the Kiniksa Pharmaceuticals Second Quarter 2023 Earnings Conference Call. At this time, all participants are in a listen-only mode. After the speakers presentation there will be a question and answer session. [Operator Instructions] Please be advised that today's conference is being recorded.

to Frank, conference Head like speaker to now Rachel today, of would hand over the your I Investor Relations.

Rachel Frank

Good to quarter operator. joining recent you, morning, thank and Thank you portfolio Kiniksa's execution. call financial discuss XXXX second our results and everyone, for

section. can Media these Investors results website the found be Highlighting our on under and

outlet XXXX Mark be second John As for Tessari, and for an Executive the provide Ross the on our will our results. our Q&A Moat, quarter Chief remarks off update introduction. our also Officer, Officer, an Officer; Operating Paolini, Patel, will financial will line. Then Sanj return the Officer, our agenda, And finally, local on Financial kick Eben Chief closing Chief Chief Sanj session, our Medical Chief Ragosa, our which in will with will execution. Commercial and review Officer, start

Before uncertainties results getting today that subject statements note these from are to will may forward-looking making statements. that we be started, differ materially please risks cause and that to actual

such statements and well except speak found update as as as statements slide caption filings. law. date review under the statements, this presentation, SEC undertake can of we no factors of obligation the our this Factors as on Risk only be These and such taking risk in Our to required by

to that, With over will Sanj. turn I it

Sanj Patel

We've execute I'm in everyone. to us morning, XXXX review today. growth success positioning our results to autoimmune and good XXXX. happy and Rachel, Thanks, our continued for cardiovascular franchises, quarter financial across and second

net product $XX.X represented another quarter On growth the with million. of QX of commercial a for revenue side,

prescriber and we the enrollments our continue patient by commercial date, second encouraged execution quarter. to see and strong adoption We're in to

our and by million. ARCALYST satisfaction, We XXXX $XXX we've the the guidance raised now high rates patient also of $XXX to to therapy. remained million Accordingly, duration approval payer encouraged

This is a dosing focused response, safety CDXX side, efficacy, the program designed development XX arthritis. dose we remain chronic of is weeks. our to Phase PK on over antagonist subcu KPL-XXX, in duration study the which evaluate rheumatoid the enrolling and On II of

in next from We study expect this first data year. half the of

pursue study evaluate its rare about, be the is that to Additionally, a we potential and agreements a collaborative with to continue potential molecule continue This diseases. it number excited we to impact cardiovascular to diseases. of has in mavrilimumab

execution With that, Ross? commercial I'll turn to our of over Ross review it to ARCALYST.

Ross Moat

Sanj. revenue continued the you, to and our delighted further our quarter of underlying I'm on second growth. Thank strong share XXXX commercial drivers details performance

This approximately In possible. to as The well revenue help recurrent a experience represents QX, the net grew prescriber the growth. success as within as existing with our the is deepening XXX% underlying of driver year-over-year for of peritonitis dual as $XX.X million. this patients base on to ARCALYST broadening many strategy prescribers focus

than in ARCALYST which growth of launch the is now are since prescribers versus greater QX. more of a Total X,XXX, pericarditis recurrent than XXX

patients are of which prescribing in more visit experience the XX% prescribers. total those highlighting This growing commercial repeat prescribers repeat will an acceleration with Additionally, at future the new base, in and ARCALYST, us demonstrates help awareness physicians. much as larger

total are current the of When months. end duration around therapy. for be continues of therapy around QX, we restart One months. of calculating period, of ARCALYST that to was the approximate seeing averaged XX the treatment important subsequent of revenue rates duration drivers XX period of initial At the and the treatment the duration average

X. Slide to Moving

continue pericarditis, the and ARCALYST and we care in We are to in recurrent a huge an making as good opportunity ahead. standard a have progress of market building establish

with being Our interleukin-X as drivers ARCALYST to alpha focus frequency has physicians on beta as been and pericarditis. of increasing reach with and underlying familiarity the the recurrent well enable

a in with increased resulted spike QX growth and rapidly couldn't this of team on previously led to on of our for awareness called treatments, frequency to This field QX, a in the knowledge the off as doctors reach in we've well total increase growing as of ARCALYST activity those substantial an expansion need informed we In after discontinuations in strategy The the stable the active previously. rate patients. even base that accounting has patients number on of XXXX.

As appropriate. so our by ARCALYST focuses growth can digital patient our patients sales for advancing marketing, we're on they direct-to-consumer where advocate team continuing are complemented where self education

program, for remain patients also the through eligible are patient including committed We Connect affordability who experience prescribed Kiniksa to ARCALYST. supporting One ensuring

on generation recurrent in focused evidence we're increasing Additionally, pericarditis.

real-world in and the resonance the the the duration inform goal patient increase disease. recurrent decision-making management better physician and enrolled clinical to the data with Our registry understanding pericarditis the has over of of XXX patient-reported of of and patients already gathering to burden

Overall, our continues to we changing delivered of to we as quarter to the collaboration. our the execution, our treatment expansion, another and sales our revenue by pericarditis net helping advance paradigm strong growth many our commercialization on prescribing as focus on commercial of our the and impact possible. as of force patients base, to Based recurrent profitability boosted

to of quarter. QX. the great patients This active commercial number of a led a end had higher-than-expected at on We therapy

$XXX result, a increase further million million to $XXX $XXX from to And for to of our million we're delighted revenue As $XXX range guidance a XXXX. to million.

cover Mark I hand financial to results. over that, with Mark? And our to

Mark Ragosa

Ross. Thanks, Great.

release your several XXXX results are quarter There the in can this like earlier I'd to found attention press items issued morning. today. to financial second we detailed be Our call

approximately we reflecting the million, revenue the agreement of date, the the and deferred of second quarters. under product First, consisted Vixarelimab. collaboration the was of ARCALYST milestone representing indication $XXX million XXXX million million the $XXX and the annual a of of next development or balance in over over recognize for $XX.X earned net quarter recognition and $XX.X To license the we Genentech million three of revenue license new million, to have Genentech agreement, a under recognized expect XXX% growth; $XX of $XX revenue largely total revenue

we'll revenue third development we in recognized the book and the milestone, cash Regarding quarter. this inflow quarter the the

$XX profit to the collaboration operating of collaboration resulted grew $XX a quarter second expense million million. in in ARCALYST Second, and

million net tax million Third, the $XX.X assets. a benefit allowance tax quarter. benefit of a the in second $XX deferred to was tax helped This due of noncash release valuation on primarily income drive

our brought net well balance XXXX. ARCALYST continued was execution least fund our approximately end-of-period second million burn operating to We current quarter, as as into $X.X cash $XXX in plan expect cash the reserves which million. to Fourth, at now these commercial our

and approximately product revenue million expectation year, Lastly, patients recurrent our the growth a represents execution turning XXXX year-over-year from ARCALYST force reflects the XX% uptick product against XXXX revenue in at opportunity midpoint ARCALYST this active of This net million. between product now net expect with pericarditis expansion at on revenue to $XXX total guidance of and greater-than-expected the we beginning therapy our sales help continued $XXX to patients. for net

remarks. With for that, I'll to turn the closing Sanj call back

Sanj Patel

Thanks, Mark.

to pipeline ARCALYST, have at a also of meaningful patient mid-stage a lives. making addition successful commercialization programs we clinical In of aimed our impact on

we data study expect rheumatoid of As in first Phase the KPL-XXX arthritis half the a of II next in from reminder, year.

cash we out-licensing non-diluted into thanks and least Importantly, discipline, said, we capitalized, revenues, are financial strategic continued growing capital transactions expect XXXX. at as Mark runway, from our well now to ARCALYST

a impact. to continue make strategically do help mission is to we are and believe our We massive to patients exactly positioned need, generational Ultimately, value create in that.

operator their to I'll today, for hand questions. and the time back I to Thank you. want for it everyone thank

Operator

comes JPMorgan. Rama from first Our Anupam Instructions] [Operator with question

Anupam Rama

as Congrats a repeat the you on standpoint, prescribers? here. seeing sort qualitative as terms a more what with new I prescribers from quarter expansion force strong of guess in from well pull-throughs are driving sales of

Sanj Patel

an Anupam. by increase Thanks, Ross, And over generally, I'll you early hand I our have in prescriber base. encouraged it's as somewhat it recent why still expansion. still obviously, -- we the really to we're seen we but days, see, think

do to want Ross, you elaborate? But

Ross Moat

think very much you the that's absolutely I Yes, question. right. for Thank

And end field having So in I active which the what having ARCALYST really in team included this total to field we've morning, then the of nicely. of jump those and impact up this any for the In of of the is having reported early as pericarditis. expansion QX, some patients towards increase in of started seen, our QX an benefits of jump we've of started year, a remember in activity last signs place, enrollment we've we recurrent in And year. up larger got number see a of the rates. team think very you a

going. So how are things we're pleased with

early said, it's of As in the days that team. Sanj field expansion

visiting see both have we'll larger doctors things just team previously. how But familiarity there just do we onetime happy field-based time get and recurrent in further ARCALYST you well with brand-new that the So progress to the physicians as of I'm as who from previously of were quick reaching the slightly as, them with out a representatives smaller number with and pericarditis upon called of unable here. with for a first the hits course, we frequency

Operator

Instructions] question Sachs. comes [Operator next Our Goldman Paul with from Choi

proceed. You may

Paul Choi

good add my us commercial congratulations as questions for Two me and P&L question. Let one a on well. quarter

vicinity. First, tracking sequential lockstep all prescriber roughly prescribers the growth in of as the revenue the the and as repeat are base in growth, the number in well XX%

just understand with the reimbursement prescriber the could prescriber? you a And a comfort to on product? to comment with Is just so repeat wanted onetime familiarity process become of it for point I if tipping what maybe the sort is or

potentially pay on commercial Second, where with government the can comment that's you how just impacting you price? been are the realized versus maybe pay and mix,

R&D that the It ticked that's of there sequentially. driving And quite the related my getting Is stages just anything final question study? on bit into up quarter expense. mostly this XXX to Or third is is a else increase? that that

Ross Moat

the Yes. Paul, much for Thanks Ross. this question. is very

to tipping and the commercial repeat first then go to the So is there. revenue, initial is I'll we've prescribers, mix seen government what piece in prescribers growth that then really both the your on the also and And I'll begin versus question. take which the the point payer with, around

precipitate point. believe I we physicians strongly So once very experience prescribing mean, tipping a good for ARCALYST, with or will once future patients. the -- get patients that in that

their aware underlying is driven that so disease. and a a on going understanding beta pericarditis to means alpha the ARCALYST first is that particular often of of new and to really for for mechanism then is the which prescribe time, staff. office is that And are first disease which that cardiologists which making all, many interleukin-X recurrent So the sure us, in physicians by experience mechanism

to the drug, enrollment the very prescribe around are they mechanisms have what's side payer the that at how all how around ensuring the prior form authorizations complete to required important. regarding familiarity on that So of

of staff to seeing benefits that prescribers. initial time we're of So we and through of lot a and office their rate do educating the growing that, the spent physicians in how

sure also but as prescribers to who the then for the of patients is, the patient ARCALYST or affordable next for the eligible the And the having there's there. to can for but that in little that next patient good that very time is discuss are I that well success one, tipping as waiting the come the the we seen across point getting the suitable But whole on a patients around payer I'll a terms becoming access support bit. for to flow, drug really, treatment; go co-pay program bit; through rate mix, identifying making little well to things which repeat have patient as explained we process, eligible patients also, a first all patients therapy, like for

for advantageous really increase repeat that. the very prescribing. strongly get and n if we reporting believe And a positive and think then back quarter-on-quarter, significantly prescribing the patients will goes experience, size prescriber outcomes be good So go progress clinic therapy we the we've to as increase making continuing the rate good that with and from they on time on, being we're into have therapy, on seen

for in So Medicare pericarditis important XX% a of if a commercial payer the whether insurance, approval bit think to reminder, mix, in XX% I we high based. a payer point go about patients as here have ARCALYST that on I the very government remaining Medicaid. of and all patients XX% across or we it's commercial recurrent about rate And about under with the the is little talk mix, see

approval across So rates we're the seeing high board.

question. hand to I'll the And P&L over

Mark Ragosa

thanks, Great. Paul. And Yes.

you question, your think answered it I sort of right.

think are saw of largely and tick I XXX, you the and right, related initiation X to we X. where R&D had cohort and cohort cohort sequentially continuing, up X

R&D the the the spend So that or additional of sort in to speaks really quarter. incremental

Operator

with [Operator Meacham Geoff Instructions] Bank comes question of Our from America. next

Alex Hammond

through Hammond Can Alex the out is on Meacham. deployment to recurrent build the continue Congrats for quarter. needed walk on the us This market? Geoff to you pericarditis capital

are time. And Can looking cardiovascular collaborator? continuing what now then Connected high on where versus collaborative And some are the been to in is the you in Mabry, how study to bar? has XQ? pursue you you for speak the diseases agreements for a rare And

Sanj Patel

think to you've did seen first Ross, reach -- and assess late force last And We're we to part? the take our do you year I a we we've good as sales obviously that, feel growing want continuing have described, Within quarter-on-quarter. our revenue increase now. Ross essentially, needs. really

comments on that expanding far needs going team any Mark, the as the as forward?

Mark Ragosa

is absolutely help are the evaluating look and we always I to more best I do Sanj at think to patients Yes, data sooner. correct. mean our ways

And so I on at that's where the ARCALYST. behind we're think investment

Sanj Patel

we're to On John, looking want make what Mavrilimumab, for there? do comments you some on

Clearly, that program. about excited we're very

reach some at comments. lines patients scientific We there are there and looking study that value increase -- help agreements the their at that very interesting are to increase any with collaborative various looking we're centers, into of research and

John Paolini

question. the for you Thank Sanj. Absolutely,

in So yes, confident very Mavrilimumab. mechanism of we're the

regard study see new hypothesis generating agreements, to we in capital-efficient as way And provide so so experiments. this collaborative to very data with a

academic comment result, of as more any this by approach the Many this be you filed the trial we to have we progress of discuss so And work additional that a more INDs color and would is engaging primary [Indiscernible] point, be at the research for these at you collaborators as on held this of will And as our studies focus with investigators. follow that do to type don't time.

Operator

next Wedbush comes Nierengarten [Operator Securities. question David Instructions] Our from with

may proceed. You

David Nierengarten

there? else? guess, Is include financial much a for a the future Phase something development or in the a quick indication, Does -- assuming on just XXX I in cash Maybe that question additional guidance. runway III how

Mark Ragosa

Yes, David.

I the appreciate So question.

alternatives, to I drives continue guidance pipeline and the to where also development. advance ARCALYST to to It behind the past in to continue invest pursue is grow commercialization what flexibility does think say the said business then profitability we've including we strategic nicely. continue and flexibility continues that provide to to

much have we our haven't And little discipline, collaboration ARCALYST, But upon the last lower the sort flexibility. outlined as helped we XXXX, the into the of certainly, so burn while. sort really do general over and with in based buckets has of time runway which how of revenue our confidence as financial well market

the to runway, in confident does very flexibility it invest. So to and some continue provide

Operator

[Operator Instructions] question Our Liisa ISI. next Bayko with from Evercore comes

You may proceed.

Liisa Bayko

follow-up on a Just R&D.

expand think bit you Maybe the run Might for $XX million, So is to from a of that look little the on about good up a rate year? here? remainder that? can just

Mark Ragosa

Yes.

to are too R&D, on So John as a IV/XVRX Vixarelimab our haven't I mavrilimumab about, sort take indications. I've that So the we right? PN at what synergistic remaining beyond cardiovascular on evaluating costs we just it sort discussed And sort There focused trial. talk about, some and Phase of as current the are are with largely II specifically to you resources look heard complete sort trials, then what we think we're of sort David opportunities, of trial. and much ongoing our investing of really are talked of

really forward. that's not R&D our at guidance focus further where and provided And the is moment looking have so really

Liisa Bayko

on you in you to for -- had Can comment any addition net that? And free gross ARCALYST for maybe quarter? quantify the to what drug the

Mark Ragosa

start. So guess we I can

and on is this We XX.X%. big in haven't level to fluctuation, year-over-year point. largely increase certainly setting believe net there's gross swings as assistance we consideration of quarter, don't said co-pay talked our was the sort always in gross about And really guidance. free patients the additional as some second in to up to the in and quarterly far therapy we through quantify goods some when result, net but more the quarter, or year-to-date the expect these as of second the past to attributable take a as And factors at continue past we've into and

Liisa Bayko

a then like Or this the of by chronic to is kind How Is was the on It's duration think what's therapy may great thinking are really duration a And going I struck thinking you latest more about XX-month therapy? Okay. therapy. treatment? be long how -- this patients update. the do of be on really you of now?

Ross Moat

Ross. is this Liisa, Yes.

that. seeing different we becomes ways there I the grows obviously of robust, thinking more are around sharing what certainly at the given So as and look think more we're time. data at about information And

disease. the of for history initial their that the around of trial is once But at average in see duration usually on the patients. XX We're what the we a is or moment the restart end at rate treatment discontinue months is stopped, seeing there natural patients believe

about back an So come period therapy, of quickly well. as pretty on X-week patients and to XX% time usually within

therapy. seeing patients total for is of as back X you the subsequent total really around of to to At duration months. we data months And come on patients XX we're of median building takes average the the the when at the about on duration end see duration moment, It a then your QX.

that are up to the date, I the contemplate evolve to to years look is into still that mind natural at from of median building to patients from when the prescribed into ARCALYST? being. to eventual in that's the and this what Bearing pericarditis they suffer you out around far weigh need But into X disease that of disease, X the of a forward of obviously, continues And data therapy what mean, of additional something to are that history the that's we may dynamic against end we're being more. how the duration patients is seeing to just backdrop it's disease. years, and the then something continues And continue recurrent X/X build.

Liisa Bayko

just then for sneak if Mark. X in, Great. final I And X can question,

the to could just are noticed bit. what you referring of in -- revenue $XX X of you in mean the a are next a about the you related? talked it little that a talking about completed is had exactly elaborate million deferred Can you I You what explain Genentech -- the milestone, development the by balance X next And the quarters? Or payment? you was milestone upfront being continuation just you If development quarters.

Mark Ragosa

Yes, sure.

we $XXX sort and digits in I low million the fulfilling we as upfront as million before upstream transaction, double about when Genentech milestones -- in mid-teens royalties the $XXX near-term obligations. announced So as we talked of of think to and payments well

the today, so earned quarter, as the the the of have we agreement. license as end $XXX recognized under million $XXX second And of of million of

more obviously, the than And the for that's new also of -- from upfront, so began $XXX portion Genentech -- development a it reflects recognizes recognition of development reflects a in recognition the they million indication the for. that milestone

so million, $X course $XXX the million that the there's we agreement. deferred X earned next And quarters. $XXX of of under there's in to to license the million $X recognize million the recognized over We've date revenue expect

Operator

Thank back to like I'd Patel any for turn remarks. to it you. Sanj now closing

Sanj Patel

We today. you, Thank the the questions the updates and an exciting joining everybody, to thanks, operator, call have ahead of rest clearly of looking us, in and the for year additional forward for future. providing

So thank all. you

Operator

This participating. for call. Thank concludes conference today's you Thank you.

You disconnect. may now

Rachel Frank	Associate Director of Investor Relations
Sanj Patel	Chief Executive Officer
Ross Moat	Senior VP & Chief Commercial Officer
Eben Tessari	Chief Operating Officer
Mark Ragosa	Senior VP & CFO
John Paolini	Senior VP & Chief Medical Officer
Anupam Rama	JPMorgan
Paul Choi	Goldman Sachs
Alexandria Hammond	BofA
David Nierengarten	Wedbush Securities
Liisa Bayko	Evercore ISI

Kiniksa Pharmaceuticals (KNSA) 25 Jul 232023 Q2 Earnings call transcript