Afternoon. Thanks for joining us. Welcome back to the Bank of America Healthcare Conference. I'm Jason Gerberry. I'm one of the senior SMID biotech analysts here. It's my pleasure to have our next presenting company, BioCryst Pharmaceuticals, which, as a point of trivia, is one of my longest covered names, both as a lead and as an associate analyst. So I've known Jon now many years. Sitting next to me is, of corse, CEO Jon Stonehouse. Welcome back to Vegas, Jon. Yes. Thanks for coming. We were talking about how many years. It's probably too long to admit, but it's great to be back here. Yes. Thank you. We're always happy to have you. Yeah. Maybe for those folks who aren't as familiar with BioCryst, could you give us a quick two-minute... Sure. ...summary of the company, and then we can go into Q&A? Sure. I will be making some forward-looking statements. John Bluth would get angry if I didn't say that those have risks. The risk factors can be found on our website. Yeah, we're in a really interesting spot. We have a product on the market that is a oral once-a-day drug. Mm-hmm. In an injectable market in a rare disease, and we've gotten off to a fantastic start in the launch of that drug, and we're now entering our third year. Yeah. We expect no less than $320 million in revenue in the third year. For a rare disease launch, I think that's pretty impressive. We're on our way to $1 billion at peak sales. That by itself is unique, but we also have a discovery engine at our discovery center in Birmingham, Alabama, and we believe that we can create another ORLADEYO in that discovery center. We weren't lucky. We believe that, you know, it was our second-generation kallikrein inhibitor. There's only been one plasma kallikrein inhibitor that is a once-a-day prophylactic therapy that made it to market. Five tried and failed. Mm-hmm. Our first one was one of those. We think we can do it again. We think with the capital that we have through the growth of ORLADEYO, the recent refinancing of our debt with Pharmakon, and then the great science in the company, we have the potential to build a really valuable company. Yeah. You have had a great launch with ORLADEYO. I think when you initially come out of the gate meaningfully beating expectations are that you just do that to perpetuity. That necessarily can't be done at the same pace. You know, for those who may not have fully appreciated, you know, the first quarter's results and the, you know, the, I guess, the tenor of the rest of the year, maybe let's talk about, you know, what you saw in terms of uptake, where most of your new growth, let's say, in 1Q came from. Yeah. 1 Q was a really good quarter for us. Mm-hmm. Just recently, we crossed the 1,000 patient- Mm-hmm. threshold in the United States which is impressive. With 7,500 diagnosed and treated patients in the U.S. with HAE, there's still a lot more to go. That's exciting. The growth rate in new patients was 46% year-over-year. Mm-hmm. The net patient adds, on average each year has been around 300 patients. That's a nice, steady trajectory. Mm-hmm. We feel like there is no loss of steam, plenty of opportunity, and it makes sense. In an injectable market where you can take an oral once-a-day therapy, why wouldn't you try it? You know, and this is a highly competitive market. There are eight therapies that have come onto the market in the last 12 years. Yeah. You know, it's a well-served market. People's disease is controlled, so doctors don't see them as often. We gotta convince them to switch and that takes a little bit of effort, but we're making some great progress. Okay. You know, we talked about the importance of, of your drug being the only oral available on the market. As you said, this was, even though it's a rare disease, it was a pretty crowded space when you entered. Yeah. It seems like other companies continue to explore similar or other modalities and all the way including gene editing. As you think about the future, growth potential of ORLADEYO, what do you think needs to happen in order to reach that billion-dollar target? It's not an unrealistic target given that at year three, you're already at $320 million. Is it gonna require that, you know, people stay on drug, you know, at a certain%? Yeah. Is it gonna require just a lot more, you know, throughput in terms of new patients coming on, or is it both? Well, let me describe what it'll take mathematically. Yeah. This might help you. Of the 7,500 to get to 80% of that $1 billion coming from the U.S. and 20% from the rest of the world, we need about 2,000 patients in the U.S- Mm-hmm. on our drug for a full year to get to the- Yeah. -roughly $800 million. From a market share perspective, that's somewhere between 25% and 30%. Yeah. That's very reasonable. Yeah. The other questions are, will we keep these patients on? One of the things we're finding is that, and this pattern is really stabilized now going into the 3rd year of launch. If you've been on ORLADEYO for a year and you're benefiting from ORLADEYO, the likelihood that you'll stay on ORLADEYO is really high. The attrition rate after a year is 1%-2%. Mm-hmm. If that continues to stabilize and we keep adding more of those 7,500 to try it, we'll lose some because it doesn't work in everybody. You can see the math. You can get to 2,000 from a pretty straightforward perspective. Then with new competition, you know, we've done, I think, more market research than anybody in this space, both before the launch and since the launch. We spend a lot of time trying to understand switching, which it's a switch market. Mm-hmm. It's a sticky market, right? People, if you're controlled, you know, this was, you know, there's still a decent amount of CINRYZE sales out there where you infuse, you know... Mm-hmm ... twice a week. Why is that? Because it saved that patient's life, and they don't wanna take the risk of going off that therapy. What's the incremental benefit of any new therapy to switch off the old one? With ours, it's the oral, right? If you're controlled on our drug and you're taking a once a day drug, what incremental benefit do any of the other therapies offer? With regard to gene therapy, I just think there's a lot of risk. I talk to a lot of patients and physicians, and while the thought of a cure is appealing to a lot of people, the risk associated with what gene therapy could do scares them. We think we can hold on to share and build share over time, even with competition, new competition. I think you might have made a comment about the $1 billion is totally reasonable. It might just take longer than people had previously anticipated to get there. Mm-hmm. Maybe give a little bit of color on why that is. There's two main causes. One is that this point of satisfaction with your current therapy. We've gotta work with every doctor and every patient on what is the benefit to switching to oral. Word of mouth is starting to spread, and patients are saying the oral drug has changed their life. They're taking a capsule a day, like their daily vitamin, instead of looking at their medicine in the refrigerator, sticking themselves with a sharp needle, you know, every two weeks, once a month, whatever it is. They forget they're sick. Mm-hmm. That that is a huge benefit. What's the risk? The risk is you go back to your old therapy if it doesn't work. It's not like there's not rescue therapy if you have a breakthrough attack, the risk is really low. Why wouldn't you try it, is a really big piece. The second piece is because these people are under control, the doctor doesn't see them as often as they did 10 years ago. Mm-hmm. They may make a decision that, "Yeah, I'm ready to switch some of my patients over," but they might not see them for six or 12 months from now. It's just, it's a longer cycle time, and that's why it's not a hockey stick, it's more of a straight line steady growth- Mm-hmm. Okay. to peak. Got it. What is your view about patients, in the future that you will add? Are they gonna be still mostly switch patients or are they gonna shift more to treatment naive? Yeah. There's two populations of switchers I would call. There are very few newly diagnosed that aren't on any therapy. Okay. Very, very small, like 100- Okay fewer patients a year. It's a switch market and they come from either on-demand therapy where they're treating their attacks with injectable therapy or they're on another prophylactic injectable therapy. Right now we're getting about 50/50 of the new patients each quarter. Half are coming from prophylactic switches, half from on-demand. The on-demand population's shrinking. You know, you have three companies, Takeda, CSL, and BioCryst all promoting, you know, prophylactic drugs. So more and more patients are switching to prophylactic and it's 70/30 now, prophylactic to on-demand. We think it could go to 80/20 or even- Mm-hmm 90/10. Mm-hmm. Eventually it's gonna be more prophylactic switches than on-demand therapy switches. Okay. Where in particular would those switches be coming from? Like, what other drug are they switching out of? You know, they come mostly from TAKHZYRO... Mm-hmm ... because that's the market leader. Those happen to be the patients that actually do the best on our drug too- Yeah which makes sense if you're controlled on an antibody that reduces kallikrein. Why wouldn't you do well... Mm-hmm ... on a small molecule that reduces kallikrein? You know, we get HAEGARDA switches as well, and then some CINRYZE switches. You also recently started a pediatric study. Mm-hmm. I think you called it the APeX-P. P ... for pediatrics. Why is it important for that, ages two and above, 2-12 to be addressed? Yeah. It's really important, right? If, you know, you're a parent, you know, you definitely know that your children don't like to be stuck with needles... Mm-hmm ...it's traumatic for a six-year-old or an eight-year-old to have to get an injection every two weeks. We've been having parents chasing Bill Sheridan, our Chief Medical Officer, and I down at meetings saying, you know, "Where's the pediatric formulation? Mm-hmm. We have a really interesting formulation that's looks like cake sprinkles almost. It's called granules, and it's in a little packet sachet that you sprinkle on yogurt or applesauce... Mm-hmm ... you know, you can take it very easily for children. A massive unmet need for this population. It's small. It's probably 500-ish patients in the U.S., but this is a patient for life. It's clearly a segment we should own. There's a, I don't know if I wanna call it a halo effect, but a follow-on effect where we've seen with adolescents, a 13-year-old does really well on our drug, and all of a sudden the mother or the dad who has HAE says, "Hey, maybe I should try this drug. Mm-hmm. My son or daughter are doing really well. We think there's some carryover to the family since it's a hereditary disease. What% of the HAE population is pediatric? It's about 500 patients in the U.S., so it's pretty small. Okay. Less than 10%. Are they easily found? Yeah. Most parents that have HAE get their kids tested, I think, within the age of two years. Okay. It's a C2 test, C4 test and Are there breakthrough attacks similar to what adults get? It depends on the child. I would say in most cases, kids don't start having attacks until puberty and hormonal changes... Mm-hmm. are taking place. I know some families that have really young kids that, you know, are five years old that are having, you know, multiple attacks per week. Okay. It can be awful. Okay. What are they mostly on right now? TAKHZYRO is I think has approval now down to two. CINRYZE, of course, is available as well, but they're injectable therapies, right? Okay. All right. Maybe let's, like, move to the pipeline for a few minutes 'cause there's a lot. Sure. going on there. maybe with BCX10013, can you talk about, you know, why you chose to prioritize this particular molecule in your pipeline? Yeah. let me just back up just for, 30 seconds and- Sure. What we're trying to do is what I said at the beginning, which is show that we can bring forward another ORLADEYO. Mm-hmm. We believe serine proteases are something we're good at, and the complement system is full of them. We believe there's a lot of rare diseases with one pathway that we could go after. The alternative pathway is where we started. We had early discovery efforts years ago in Factor D, and we, you know, we started that back up again and came up with 9930, our first generation. That didn't work out, didn't have the profile that we wanted. Mm-hmm. We switched to 10013. The reason we really like the potential of 10013 is it could be a once-a-day drug that, you know, controls disease in the alternative pathway. We think that could be a best-in-class molecule. It's early. Yeah. It has risk. If we get there, we think it could absolutely be another ORLADEYO. you know, complement system has now become pretty popular just because of some other companies that have gotten, data, positive data in diseases of the eye, for example. As you look at the different potential targets within the complement cascade, both the classic and the alternative, how are you deciding on what you would wanna focus on at BioCryst? I mean, and, you know, what part of your science is best suited. Yeah. for complement, mediated development? Again, I think, small molecule serine proteases is something that we've shown we can do. That, you know, C2 is another target... Mm-hmm. that we're really interested in, and we have a program going right now where we're trying to optimize a lead for an oral- Yeah. C2 inhibitor. The other idea is the terminal part of the pathway. We think there's some really interesting serine protease targets there as well. Lastly, combination therapy. One of the things we're hearing in renal diseases is that you gotta hit both the classical and lectin and the alternative pathway. Mm-hmm. How do we address that? We're looking at all of that. You know, because there are multiple diseases with one target, there could be lots of opportunity to help there. Have you talked about what particular diseases you think you'd wanna target nearer term? I think the renal diseases are most interesting to us. In the dose-ranging patient study, we're looking at PNH because you get an answer really fast. Uh-huh. You look at the hemoglobin, you look at the LDH levels. You can get an answer if it's effective or it's not effective quickly in a small number of patients. Diseases like IgAN, where there's actually a really interesting subset of the total population that the alternative pathway plays a bigger role Mm-hmm. -could be really interesting with an oral once-a-day drug. Yeah, you mentioned PNH, which similar to HAE, is a pretty crowded space. Mm-hmm. Is it your view that the same formula you used for HAE would be an established market where you could find the patients, but you would provide the oral option? That would be the same reasoning for wanting to pursue PNH? Do you think that you could also provide an efficacy advantage? I think PNH is one of those that really gets us a near-term answer. I think things like IgAN, C3G, aHUS. Mm-hmm. Are all indications that are probably more attractive for a once-daily oral. Yes, we wanna replicate the ORLADEYO commercial success by having something that there's an incremental benefit. Mm-hmm. We think once-a-day dosing and similar efficacy could be that incremental benefit. Factor D is something that we've talked about before. As a target in the complement cascade, I think other companies have tried to look at it in various different ways. What are you doing differently that gives you confidence that this should be one of the areas of the cascade to focus on? Yeah. Again, I think it's what do we offer that's different? The, you know, the pathway is pretty clear. Whether you choose Factor B or Factor D. Mm-hmm. At least so far, it doesn't look like there's a difference. We may find that out in other indications, I think having a once-a-day dose is really the big difference. Having really good efficacy and a once daily dose and a safe and effective drug is the key. Okay. Now, can you just give us an update on safety observations for 10013? Yeah. We nearly completed the SAD/MAD, and we saw some really impressive drops in the alternative pathway. Mm-hmm. With this Wieslab assay in healthy volunteers. At a single 110 mg dose, we saw almost 98% suppression of the Alternative Pathway. That was really exciting. We were running our toxicology program, and you have early toxicology for 28 days, then you do the mid 13-week study, and then you do chronic tox- Mm-hmm. six and nine month. In the six and nine, one of the six and nine-month studies, we had some observations early before 13 weeks in this study that caused us to go slower. What we're doing now is we're completing that study, so it's not finished. It's a nine-month study at the end of the day. Mm-hmm. You've got histopath and all the other things that help you understand what's going on. What we think is the path forward is to go to places that don't have drugs, for example, for PNH, like South Africa, and study it in a small number of patients and do the dose-ranging. Mm-hmm. If we can get to a once daily dose that brings the LDH into the 1.5 x the upper limit of normal or lower and is safe, we think we might have a best-in-class molecule. Okay. When do you think you'd be able to move forward clinically with the program? You know, I guess, what would be the next defined catalyst? Yeah. What we have to do is we have to get regulators with the information that we have about... Yeah the tox program be comfortable that we can study it safely in patients. We have to get investigators to agree to that as well, we have to get patients to wanna enroll in the study. Yeah. We're in that process now. I can't tell you with certainty when or if we'll get there, but I think we're reasonably confident that we'll be able to start a study. This calendar year, perhaps? I hope so, but, you know, no guarantees on that. Yeah. Okay. I think you were also running the non-clinical rodent tox study. Is that right? The chronic study is in two species. We didn't say which species. Okay. but- We're guessing. Rodents, rodents could be one of the two. Yes, yes. Is that on track? Yeah, I mean, we only see this in one species so far. Yeah. It's unusual that you would complete a 13-week study, and then in your chronic you would see something before 13 weeks. Yeah, yeah. That could be the law of small numbers, but, that's part of what we're trying to sort through- Yeah, right. what's going on here. We don't think we're at a point yet where we can definitively say we know exactly what's going on with that. Okay. Whatever it is, rodents or otherwise, I think you were guiding to being able to finish that by year-end. Yes. That's still on track. Yeah, yeah. Okay. You're also doing these SAD/MAD studies, I believe. What are you hoping to take away from those? Do you wanna find the dose? Yeah. No, I think we've got enough data out of the SAD/MAD- Mm-hmm to now move into patients. Yeah. What we saw, there's a slide in our deck that shows the AP hemolysis or AP suppression... Yeah ... through the Wieslab assay. You know, like I said before, with a single dose of either 80 or 110 mg, you see it knock down the AP pathway. I think we know where to start. Yeah. The question is, in patients, where can we stop in terms of how high do we have to go? Yeah. You can't do that in healthy volunteers. It's better to do it in patients. Okay. Do you have a view about how many clinical programs BioCryst can do at any particular time, just given the size of the company and the responsibilities that you have as a commercial organization as well? Yeah, I think, I think the way we look at it is what's a smart allocation of capital? Mm-hmm. Right? With the growing revenue we have with ORLADEYO, with the refinancing and the additional capital we have access to with the deal we did with Pharmakon, I think we can, I think we can do multiple studies, maybe multiple programs. I think the key, though, is to make kill decisions early enough- Mm-hmm ... where you're not advancing something that you're wasting money on. Mm-hmm. I hope we've shown that we have that discipline. I know it's frustrating at times for, it's certainly frustrating for us in patients, but if the product's not gonna be differentiated in the marketplace, we shouldn't advance it. Right. Right. Well, I've covered you long enough to know you have made those decisions. Mm-hmm. So, um- Thank you. I guess you talked about that Pharmakon deal. Can you give us a little bit of background on how that came about? For the last, I don't know, what is it, John? Three years now, we've looked at alternative financing to things other than our shares, and we've done royalty deals with- Mm-hmm ... you know, three years ago, we did this Athyrium deal, or two years ago. There's a lot of interest and there's a lot of. Mm-hmm ... to help companies like BioCryst continue to advance. You know, we wanna take ORLADEYO around the world, for example. Getting it registered and getting it launched in other parts of the world is an investment. Mm-hmm ... that we think is a good one to make. We had a process that had some really good lenders in there and we got to terms that we agreed with Pharmakon. They're a really well-established, good lender, good partner. We felt it was a way better deal than what we had, and it gave us some future flexibility that was good for the company. Honestly, I believe personally that it dramatically reduced our dependence to go back into the capital markets. In this environment. Mm-hmm ... that's so important. You know, between the growing ORLADEYO revenue and this refinance deal, I think we may never go back. I'll never say never, but we may never. Okay. Yeah, my next question was going to be, where does your current cash position balance sheet... Yeah ... allow you to go? Yeah. I'm not gonna give you a year because we could get to profitability, right? Mm-hmm. It all is a matter of what are we investing in the pipeline. If BCX10013 is successful in this PNH study, we'll do a bigger study. That'll be a bigger investment in that program. Mm-hmm ... because De-risk the program by showing we have a safe and effective once daily dose. Yeah, I think with what we have in hand, the cash lasts us a long time. A long time. That's good to know. You've always talked about having an oral that's convenient, always once per day dosing. Is there any work that you've done on certain types of diseases where an oral might work but maybe dosing more than once a day might be needed? Is that... Does that kill the idea right there? No, I think if there's an injectable market where there's no sign of another. Mm-hmm. twice a day might be okay. We'll always continue to work to make it better and get to a once a day. Right. Our team. That's a really hard thing to do because when you make something more orally bioavailable, it's usually bigger and it has a bigger charge. Yeah. I'm sorry, smaller and less charge, and that makes it less potent and less specific. It's a hard thing to do, but we're always striving to get to once a day. As you look at the complement cascade, there's so many different directions that you can go. Is there a disease category that you just think, you know, they're well-served, we don't really need to try anything on our end here? Not really. I mean, especially with an oral drug, I think, you know, there's a lot of people in the space that doesn't scare us away. Mm-hmm. Because most of them are injectable. Yep. If they're oral, they're more of a shotgun approach than a laser approach to the pathways. You know, we're not limited to complement alone. You know, I'll go back to something I said earlier. One of the attractive things about complement is it's highly likely in a number of these diseases that you gotta hit the alternative pathway and the classical and lectin, and that means you gotta hit two different targets. Mm-hmm. That's a lot easier to do with a small molecule, than a biologic. You might be able to do it with a biologic, but, it's challenging. Is there anything that's in the allergy space that could be complementary to HAE that you'd wanna do? I think rare disease is still, like, paramount to us. Mm-hmm. You know, there are other immunology rare diseases that we could go after. You know, you and I talked briefly. Yeah. We started around the eye and we're certainly open to looking to work with other companies in delivering our drug for eye disease. That's not something we're gonna be doing by ourselves for sure. Yeah. We're exploring a lot of different options, and we're looking forward to sharing with investors later this year or early part of next year in an investor day in Birmingham, Alabama, just more... Mm-hmm. Of what we do and where we're doing it and why we believe we're really confident that we can bring another ORLADEYO forward. Do you think that for, like, specific organs like the eye, that an oral option is ideal? N-No. Yeah. No. I think one, I think we're learning in these eye diseases, you gotta get it concentrated... Yeah. in the site. A distributed way of delivering it and hoping it gets to the eye- Yeah. is a lot harder. It, it could mess up pricing and things like that as well. I think having a distinctly different one that goes injected. The key is, can it stay there for a long time? Right. 'Cause people don't want a weekly or monthly injection. Right. right? Right. What about the idea of gene editing kind of encroaching into certain types of rare diseases now, including potentially HAE, as we mentioned before? Just mechanistically, what could be some of those pitfalls? I think it's the risks. You know, the FDA put out guidance about following patients for 15 years. I look at ORLADEYO as almost a functional cure. We've had patients and physicians tell us that, you know, you're taking a capsule once a day, you forget you're sick. Mm-hmm. You don't have attacks. It's basically a functional cure. That's what you wanna do, is control the disease without a heavy burden of therapy, and I think oral drugs do that. I, you know, I think gene therapy could be great for people that have no alternative. Their disease is not controlled by any of the other therapies. I think that gives people a lot of hope. Over time, we'll see what the safety brings. Mm-hmm. I think we're quite a ways away from that. Okay. Now, when you talk to investors, you know, you've been doing this now a long time and you've seen several cycles. Just given where we are today, what do you think is the biggest disconnect between what the company is doing versus how the street might be appreciating or not appreciating it? Yeah, I think convincing investors that we're gonna hit $320 million this year, I think the first quarter we're off to a good start. Mm-hmm. I think the second quarter will be more evidence- Mm-hmm. that we do that. I think convincing investors that we can get to the $1 billion, definitely we, John Bluth and I heard some investors thought that we kept losing patients, 40% of patients over time. When they get to a year, we lose about 1%-2%. There's, they're not a bunch of people falling out that we have to replace. Mm-hmm. after we get them to a year. I think then more and more people are gonna be convinced that we can get to $1 billion. Then I think proving that we weren't lucky with ORLADEYO. Right. That we can do this again, and that we'll be smart and careful about how we allocate capital to get there. Sure. I think is the other piece. If we can do that, I think there's a ton of value here. Well, it certainly looks like ORLADEYO, even if you take the very conservative estimate of half of what you think it could do, your valuation does seem attractive here for sure. Sure. Sure. With that, we're going to stop the conversation. If you guys have any questions, feel free to reach out. Thanks everybody for joining us for this last session today. Jon, as always, it's always great to catch up with you. Yeah. Likewise. Here at the Vegas conference. Yeah. Thank you.