Welcome, everyone. My name is Roanna Ruiz. I'm one of the senior biotech analysts here at Leerink, and I just want to welcome you to our Global Healthcare Conference. It is my pleasure to introduce the United Therapeutics team. Here with me today, I have James Edgemond, CFO, and Dewey Steadman, a member of IR. Thanks for joining us today. Great. Thank you for having us. Yeah, likewise. General approach today, I'll start with bigger picture questions and then drill down into more specifics. To kick it off, just to sort of set the stage for investors who are either new or revisiting the story, could you walk us through three focus areas of your capital allocation strategy, and what are some of your top clinical and regulatory goals going into 2025 and beyond? Yeah, Roanna, thank you. Thank you for inviting us to your healthcare conference. We're glad to be here. One caveat for forward-looking statements, we, Dewey and I, may make forward-looking statements. I would encourage listeners here in the room and online to review our latest 10-K and 10-Q for those risks and uncertainties regarding those forward-looking statements. To your question, a two-part question. Capital allocation is a question we get often. I would say that our current capital allocation waterfall is, and priorities are still the same. We do focus internally on our research and development activities, and we do spend capital on our facilities. As an example, we're building a new manufacturing plant in North Carolina to support DPI. We are also investing money to support our DPF facilities in Christiansburg, Virginia, for our xenoclinical trial that we will talk about, as well as other facilities in Minnesota and Texas. Our second capital allocation priority is really corporate development. We focus on cardiovascular, pulmonary activities, things that really play to our strengths. One of those is obviously commercial that we will talk a little bit about today, but also the clinical side, regulatory, and many other aspects of UT. Anything that we do on a corporate development standpoint will play to those strengths, and we will look for what we call corridors of indifference, where there is significant opportunity and not many others playing in that space. The third item for us is return of capital to shareholders. If you recall last year, just at the end of the first quarter, we did a $1 billion ASR that was well received. That capital allocation priority will be something that we'll continue to apply going forward. From a clinical and regulatory perspective, we're entering what we call the three-year cascade of clinical and regulatory activity. A good frame is what Dewey and Harry have put up on our website, where we have the foundational, the innovation, and the revolutionary aspects to our ways of growth. In the near term, some of the innovative activities are the TETON studies. TETON- 1 and 2, both are fully enrolled, and we expect later this year data from the TETON- 2 study. That's the study that was done outside of the U.S. and Canada, so rest of the world. We have the TETON-1 study that was recently enrolled, and we expect data next year. Another significant clinical trial that we're working on in the innovation wave of growth is our ADVANCE OUTCOMES study. This is a study that is using ralinepag. If you think about it, it could be one pill once a day to have a 24-hour half-life that has treprostinil levels or prostacyclin levels that could mimic IV Remodulin or IV prostacyclin. We're really excited about those two clinical opportunities in the near term. There are others. If you refer to the corporate presentation, I think you'll see there are many other opportunities there. The revolutionary wave of growth that many people are asking about today so far has to do with the FDA's recent clearance of our IND for a genetically modified pig organ, so a xeno-organ. This is the first-ever xenoclinical trial that should be registration-enabling. I know we're going to spend a few minutes on that this morning as well. That is an opportunity to serve patients that are currently on dialysis that don't have another opportunity to qualify for an organ transplant, whether they can't make it onto the list or, frankly, their health declines before they're able to make it on the transplant list. This is an opportunity to serve hundreds of thousands of patients with our xeno-organs on a going-forward basis. We expect the first transplant to occur later this year. Okay. That's a great recap. A lot going on, so I'll start to take it one- by- one. A lot going on. Yes, in a good way. I'll start with Tyvaso, since that is also driving a lot of the conversations I have. It was approved in PAH, second indication in PH-ILD. Can you just recap and sort of set a baseline of some of the key differentiators for Tyvaso and thinking about the DPI in particular? What are some of those drivers that have been supporting such solid growth over the past year or so? Yeah, it's a great question. If you think about our ways of growth, that is the foundation, and it's a commercial activity that are going extremely well. I would give a lot of credit to Michael and Greg Block and their commercial team for the outstanding work they've done there on the commercial side. From a DPI perspective, there's many ways to think about it. When you think about the product profile of DPI in general, it is a device that is easy to use, requires one breath per session, and has a very high patient satisfaction rate. If you go back to the BREEZE study that we did, there was a 98% satisfaction rate with Tyvaso DPI. From a patient's perspective, we think the product profile and the use of the device is extremely convenient for the patients. From a delivery perspective, it is what is called a low-flow, high-resistant device. When you think about a patient's lungs and their ability to inhale, this does not require a lot of patient force to inhale, but you have a nice distribution of treprostinil through the lungs. From an administrative perspective, Tyvaso DPI is very good for the patients. I think when we think about the manufacturing capacity and availability, there is no question going forward about our ability to deliver DPI. I mentioned that earlier, that we are even building another facility long-term for the idiopathic pulmonary fibrosis trials we talked about to have supply there. Overall, I think Tyvaso DPI has been well received. It is certainly contributing to the growth along with the PH-ILD space as well. Yep, sounds good. You alluded to this a little bit, but how are you thinking about future scalability, meeting potential demand, etc., for Tyvaso, particularly DPI? How do you balance that, sort of getting in front of that demand wave, spending appropriately, things like that? You bet. There are three ways to think about it, or we think about it. At MannKind's facility up in Danbury, Connecticut, they've expanded their capacity over the last few years. They can support about 25,000 patients. That's item one. I think the second way to think about it is finished goods inventory. We, as well as MannKind, have been able to increase our finished goods supply of Tyvaso DPI. We feel we have adequate inventory there. Third, and I touched on this earlier, as part of our investment in ourselves, we're building a facility in North Carolina that could produce up to supply for 75,000 patients. We feel in the near term, medium, and even long term, having the ability to supply patients with Tyvaso DPI will not be a problem for us. Understood. Great. Digging in a little bit more, I just want to ask about the PH-ILD segment and thinking about Tyvaso growth. What is contributing to that demand there in that segment and thinking about future drivers as well? What education are you doing? What is your field force doing behind Tyvaso, etc? Sure. I'm going to have Dewey, since he's up here with me, take one. Thank you, James. I appreciate it. Roanna, thank you for having us. The work we're doing in PH-ILD has shifted from center-based promotion to more in the community setting, so these individual pulmonologists that have just ILD patients, not necessarily pulmonary hypertension or PAH patients in their practices. There is a lot of education and hand-holding that has to go on at these practices to get the physicians comfortable with the idea of doing a right heart catheterization, which is the diagnostic that has to be done to determine pulmonary hypertension, to get reimbursement for these patients. We have to educate the practice on right heart cath. We have to educate the practice on referral forms and patient support programs that we have in place. We have to help with patient training because this is a new device for these practices. Once we get two or three or so patients under each practice's belt, they very quickly go to 10 patients and more. That is depth of prescribing. Last year, we really focused on breadth of prescribing, reaching out into the community and getting as many of these practices as we can to start prescribing Tyvaso and Tyvaso DPI in PH-ILD. This year, we are focusing on continuing expanding that breadth, but also focusing on depth. We expanded the sales force, I guess, in late 2023. They really hit the ground early last year, and they have now round-tripped a year in the field. We are starting to see a lot of progression in the community centers in PH-ILD. That is really our focus: depth and breadth for 2025. Can I add one thing too? What's interesting too, and Dewey covered it wonderfully, some of the key points that was reflected in what Michael Benkowitz talked about on the recent earnings call is when you're seeing in Tyvaso specifically, which is attributable to what Dewey explained on the sales force expansion and then not having kind of a round trip been in place for years, you're seeing Tyvaso referrals and starts at these record levels. What you're seeing is the investments that Michael has made are really coming to fruition. This is what Michael talked about in the recent earnings call about what we're seeing in terms of underlying metrics, which is what he views and we all view in terms of a going-forward basis. Got it. Particularly for these new prescribers in ILD, I actually thought it was interesting. I think in the last earnings call, you were messaging there is use of DPI, but also nebulizer can be used as well. Maybe could you just elaborate on that? What's the rationale behind that in terms of possibly helping to titrate patients up to DPI? How do physicians look at that? Yeah. Yeah. You want it or me? I can take it. Yeah. We are really blessed to have a platform for Tyvaso that is the nebulizer and the DPI. The assumption, and I come from the spec pharma world, and you cycle patients on products and you force switch, and you do not necessarily give patients choice in the spec pharma world. At United Therapeutics, we really believe in patient choice. We want to give patients and physicians the option that is best for them. Some patients prefer the nebulizer. Some physicians prefer the nebulizer. Some patients want DPI. Some physicians want DPI. We will give them that choice. What we found is with this choice in the PH-ILD settings, some practices, not all, but some practices are using the nebulizer to titrate patients up in one-breath increments. The DPI device goes in three-breath increments, and it is a dry powder inhaler. Dry powder, whether it's our device or someone else's device, will cause cough because it's dry. It's a powder. It's not natural for the lungs. The patients are acclimating to dry powder, and they're also acclimating to treprostinil at the same time. It might be easier for some patients to use a nebulizer, which does take longer to use, but it is wet, more natural for the lungs, and can be easier for patients to titrate to their maximum effective dose, and then move into DPI where they can get used to the DPI itself. That's an easier transition for some patients as they start Tyvaso therapy. One of the advantages of our platform approach is really focusing on patient need. Got it. Great. I know we're coming off of your Q earnings. Maybe you could just give us a couple of highlights on what to unpack there for Tyvaso and some of your strategic contracting with payers and what's driving your enthusiasm about the franchise overall going into 2025? Yeah. It's a great question. When you think about the foundational aspects of our business, we're coming off a year from a quarter and an annual perspective where we had more than 20% growth. We feel very confident in the investments we've made, both in the sales teams and other investments on the commercial side. You mentioned some of the contracting side. What Michael had done is to think about the opportunities to make sure that we were positioning ourselves and our products to be able to continue on this growth trajectory. We did make some investments into rebating where there was PBMs or some other contracting. We feel it was a smart investment that we made to be able to continue on this trajectory. You saw some of that impact that really came into play in the fourth quarter. We think that would be a good base, more or less, to grow from. It is a decision we made. I think overall, if you were to step back across the board with the sales teams, the product set that we have, and the continued investment, we think in these clinical trials going forward, sets the organization up for continued double-digit growth going forward. We feel very comfortable with that foundational aspect of the business to continue produced. It's up to us to really focus and just continue to do what we're doing, commercial side, and again, on the investments and the research and the R&D side to continue that growth aspect. Yep. Just to double-check, on the payer negotiation front, do you feel like that's largely settled out? Are there other ones that you're still working with into the year? Yeah. For the most part, we think most of that was reflected already in some of the gross-to-net revenue reductions. There could be a little bit that kind of trickles in as you think about how some of these get pushed down into some of the plans. For the most part, we think they're fully in play at this point going into calendar year 2025. We don't expect necessarily any headwinds at this point going forward. Got it. Great. Sticking with the pricing topic for one more second for Tyvaso, I have gotten a question about IRA as well, provisions kicking in in 2025. Can you just level set for us? What does that look like for Tyvaso? What are your expectations going forward? Sure. Just to go back in time a little bit, if you recall in 2024 in Q1, when the IRA went into effect, we did see a benefit at United Therapeutics where we had patients that were on free drug actually transition to be commercial-paying patients. You saw a big benefit of that kind of in the first quarter of 2024. You did see also for the balance of the year some additional transitions of patients. For the most part, that happened in the first quarter. When you get to 2025, we think there'll be some benefit, but it won't be as significant. We don't expect a significant impact like in 2024 in 2025. We think most of that's played out. You're going to have things where you have an out-of-pocket cost contribution from a patient that they can now spread across the year. There are some benefits. We also just talked about some of the investments we've made also that would have that impact. For the most part, the contracting should have played out in Q4. It really would be a new base, as we say, to grow from going forward. Yeah. That's good to hear. I'll turn to the clinical side of things for a little bit next. I know you mentioned in one of the earlier questions about TETON-1, TETON-2 trials coming for Tyvaso in IPF. Assuming that these are positive, how would these position Tyvaso in the IPF landscape? Maybe we'll start there, and I'll dig in more. Yeah. The TETON studies, both TETON-1 and TETON-2, allow the concomitant use of nintedanib or pirfenidone, but not both, toward Tyvaso as a monotherapy. The ideal label for us would allow us to be used alone or in combination with existing approved agents. That reflects our, I believe, in what we've done in PAH, where dual therapy is what patients start on, and then they add more therapies from there. You're building on addressing multiple pathways of disease, as we call the four corners of disease. In PAH, there are literally four corners to address at this point. In IPF, there's a lot of pathways that could potentially be addressed. You have companies that are working to address individual pathways within pulmonary fibrosis. Some are having success. Some are not having success. Tyvaso has been shown to be antifibrotic in vitro. It also addresses several different pathways beyond vasodilation. We could have something that could work on multiple pathways, but also work with other agents. We are not looking to be a monotherapy. We are looking to be used in combination with other agents, even when they come to the market in the future. I think that is how IPF will progress over time because it is a very deadly disease. It is almost as deadly as lung cancer, which is always polytherapy. To not do polytherapy in this very vulnerable patient population is concerning. We want to make sure that we are able to address multiple pathways here. Got it. Are there any commercial synergies that could happen, assuming that you're already approved in PH-ILD, if you also get an approval in IPF? How does that look in the future? Yeah. On the surface, it would appear to be a similar call point, and it is. But our strategy is our existing commercial strategy is we have two different Tyvaso sales forces, one that does PAH, and then one that does PH-ILD. And then we have a third sales force that does Remodulin and Orenitram in PAH. So our PAH docs are getting two calls from a United Therapeutics rep. We could, and we have not made a final decision yet, field another sales force to do IPF in much of the same vein where we have a Tyvaso rep for PH-ILD and a Tyvaso rep for IPF. Again, we have not committed to the strategy yet, but it is something that we are considering. Any expansion we do for the sales force would be consistent with our budget algorithm where we do not spend more than 50% of prior year revenue in operating expenses, which would include selling expenses. Got it. Just thinking ahead, a question that I get from investors is, what should we be looking for in the first TETON trial to read out in terms of what would be good data, what would be amazing data? How are you thinking about that reading through to the second TETON trial as well? Yeah. To take your questions backwards, the two trials are structured very much the same. They're the same clinical design. It's just the geographies that are different. The geographies in TETON-2 are fairly advanced markets. They're markets that have nintedanib and pirfenidone available. Those are used in patients roughly in the same rate as they are in the U.S., which isn't high. It's only like 30% because of the side effect profiles for the drugs. For us, if you want to focus on the positives only, great data for us would be an improvement in FVC, which hasn't been seen before in a registration study in IPF. We saw that in the INCREASE study, which these are patients with pulmonary hypertension in IPF. We saw between an 80-100 milliliter improvement in FVC in these patients at 16 weeks that held out to 64 weeks when we ended the open-label portion of the study. If we get improvement in FVC, best case scenario, home run. If we get stability in FVC or a minor increase in FVC, that's still a marketable drug because the two drugs that are approved now, nintedanib and pirfenidone, slow the rate of decline of FVC, but they don't reverse it. If we're able to show stability in these patients, that's something that's very much needed in this population. That would be another win for us as well. Even if we're able to slow the rate of decline more so than nintedanib or pirfenidone, or we show a synergistic effect with one of the two drugs or both of the drugs, that could be a good outcome for us as well. There are many different positive outcomes for us from the TETON studies. Yeah. Sounds good. Great. Flipping to another clinical trial, ADVANCE OUTCOMES. You mentioned it briefly earlier for ralinepag. In terms of thinking about the enrolled patients, there are baseline characteristics like background therapy, risk scores. How does that influence the trial's powering? How are you thinking about the primary endpoint as well? Yeah. One of the challenges we've had with the ADVANCE OUTCOMES study is that it's an outcome-driven study. It is a very long duration. We also started the study right before COVID. Then sotatercept came in and kind of took the air out of the room in terms of patient availability. Over the course of running the ADVANCE OUTCOMES study, patients have gotten healthier, which is a good thing. We'll take it. The placebo arm is not accruing events at the rate that we initially predicted because we're using 2018 data for that prediction. We are seeing progress in the study. We expect to close the study for enrollment in the middle of this year and then stop accruing events at the end of this year, which would give us data in 2026. For ralinepag, it really is a, dare I say, a game changer for pulmonary hypertension because the two products that are used first line for patients in the ERA and PDE5 are once-a-day oral pills. Ralinepag is a once-a-day oral pill that is an IP receptor agonist, which is essentially a prostacyclin that can be on board, titrated to the maximum tolerated dose early in the treatment paradigm. We're starting with physicians, high-profile physicians within PAH worldwide, starting to promote the idea of remission in PAH. We can't get full-on remission. It's still a deadly progressive disease. The aggressive treatment of patients from the first moment of diagnosis is critical for these patients. Not having an oral prostacyclin once a day available is preventing a lot of patients from getting a prostacyclin early in the course of treatment, which has been shown time and time again to lead to better patient outcomes. Yep. Got it. Interesting. I'll switch gears to another really interesting program in your portfolio, the Organ Manufacturing arm. I know that you recently had an IND cleared for, I believe, the xenokidney program. Because this is very uncharted territory in an interesting way, could you just lay out for investors what should we watch for next in terms of validation, endpoints, data, etc? Yeah. Xeno is one of my favorite subjects. It was an honor and a validation of decades of work to receive clearance of our IND earlier this year. We expect to dose the first patient or transplant the first patient around the middle of this year. This is uncharted territory for us, for the FDA, for society. It is not like a typical clinical study. We call it a phaseless study. It can enable registration if we move into a larger cohort. The first cohort is six patients at two centers. These are very closely watched patients. Again, open label, so there is no placebo control here. There are no set outcomes that we are seeking. We can look at the totality of the data in the six-patient set and then the totality of data in the total 50-patient set to work with FDA for a potential approval here. We are looking at various items like graft survival, which I think is the most important endpoint for us, overall survival for patients. We are also looking at kidney function. We have four different quality of life surveys. FDA and United Therapeutics really believe that this is something that can change the quality of life and change the direction of life for end-stage renal disease patients. If they are on dialysis, you are in dialysis three times a week. It is three or four hours of session. You do not feel great for the rest of the day. Your life continues to decline rapidly during this 8-10 years on average that patients are on dialysis before they pass away. This is something that can free a patient from the shackles, the tubes of dialysis almost immediately. That is a dramatic change in quality of life. We want to prove that out through this study. Yeah. Sounds good. Great. I also noticed that there's recent preclinical data showing that a single xenopig could offer both heart and kidney scaffolds. I was just curious, digging into the science here a little bit, what are the remaining hurdles to multi-organ harvesting? How does that help with cost-effectiveness, scalability in the future? Yeah. There are two hearts, two kidneys, and one heart in each pig. It would be great if there were two hearts in a pig. That theoretically can give us three different organs. Obviously, the UHeart, which is the 10-gene heart, would be raised in concert with the UKidney, which would be the two kidneys that are in the pig. We have to get UHeart into the clinic first. Our academic partners are still working through non-human primate baboon studies for the heart. If both organs are approved at some point, theoretically in the future, we could time transplants because these are not emergent transplants. The transplants into patients would be a scheduled procedure because you are not waiting for a donor to fall off a motorcycle or something like that to give you an organ. You can theoretically parse out three organs to three different patients in three different locations, all coordinated at the same time. It is going to take a lot of logistics, a lot of engineering, and obviously the approval of the UHeart to be able to do that. That does help us scale over time, obviously with cost of goods and cost of manufacturing. Right now, we're focused on just getting the kidney approved. Then we'll move into the heart. Got it. I noticed the FDA's novel therapeutics division, they're starting to highlight more flexibility for xenotransplantation or at least directly show some interest. How are these dialogues and the feedback you're getting from the agency shaping your strategy going forward? Is accelerated approval on the table? Is that something that you try to consider or ask for in the future? It's definitely something we can ask for. I don't think we've made a decision on whether we'd ask for it or whether we'd get it or set that expectation yet. Our dialogue with the agency has been incredibly positive for the last five years or more since the GalSafe pig approval in 2020. We've been in constant dialogue with the agency. For them to grant clearance of the study is a huge leap forward for the science and engineering behind xenotransplantation. It's a big commitment from the agency to make this a reality. We've had very positive dialogue with the agency. They've been supportive of our efforts thus far. It's been under two different presidential administrations. Got it. Got it. Actually, three different presidential administrations if you go back. Yeah. Interesting. Okay. In our last minute or so, I'll zoom out again and just ask a big picture question. Having all these different programs going on, how are you prioritizing investment between pulmonary hypertension, commercial portfolio, organ manufacturing, R&D, etc., and the spend curve? Are you considering any non-dilutive paths for funding in the future? How do all those pieces fall together? Yeah. I think when you step back, what we have done and we expect to continue to do is to apply. We want to be good financial stewards. We, as Dewey mentioned earlier, have this budget algorithm where we spend no more than 50% of prior year revenue on what are internal cash operating budgets. It would exclude things like milestone payments and other things. When you focus, what we will do internally is make sure we're advancing the programs and putting financial capital to the highest and best use internally. As we've done, and we will continue to do, all these various programs fit within this budget algorithm. Some of the spends to date, for example, on organ manufacturing have not been significant in terms of pushing other programs out. We do make sure we're advancing programs to the highest and best use for the biggest opportunity for patients as well as the organization. That's really still the priority for us. Sounds good. I think with that, we're at time. Thanks again, James and Dewey, for joining us. Great discussion.