United Therapeutics Corporation Price & Performance (UTHR)

We marked today will include forward looking statements representing our or beliefs regarding future events. These statements involve risks and uncertainties that may cause actual results to differ materially. Latest SEC filings, including Forms 10 ks and 10 Q, contain additional information on these risks and uncertainties. We assume no obligation to update these forward looking statements. Also, today's remarks may discuss the progress and results of our clinical trials and or other developments with respect to our products. These remarks are intended solely to educate investors and are not intended to serve as the basis for medical decision making or to suggest that any products are safe and effective for any unapproved or investigational uses. Full prescribing information for the products are available on our website. On today's call, are Doctor. Martine Rothblatt, our Chairperson and Chief Executive Officer Michael Binkowitz, our President and Chief Operating Officer James Eichmond, our Chief Financial Officer and Treasurer Doctor. Lee Peterson, our Executive Vice President of Product Development and Xenotransplantation and Pat Hazon, our Executive Vice President of Technical Operations. Note that Michael Bigwitz and my colleague Carrie Silvers were participate in a fireside chat and one on one meetings at the TD Cowen forty fifth Annual Healthcare Conference in Boston on March 3.

And along with Gil Golden, our Chief Medical Officer, I will be at the UBS Europe European Healthcare Conference on March 4 in London. And finally, James Edgmon, Harry and I will be at the Leerink Global Healthcare Conference in Miami on March 11. And our scientific, commercial and medical ferrousines will present at the twentieth Annual John Vane Memorial Symposia in London on March. At the International Society for Heart and Lung Transplantation Conference in Boston, on April 27 to the thirtieth. And now I'll turn the webcast over to Martine for an overview of our development pipeline and [indiscernible] Thank you, Dewey, and good morning, everyone. We have slides available for reference and I encourage you to review those at your leisure. I'm not going to speak directly to the slides, Congratulations to the more than 1,300 Unitharions and to you, our shareholders, for supporting yet another record revenue year for United Therapeutics in 2024. In fact, 2024 was our third year in a row of record setting revenue This amazing performance was driven by our relentless drive to deliver patients with rare and underserved diseases a broad array of solutions to help them improve their lives. Beyond our stellar commercial performance, we have now begun our three year cascade of clinical and regulatory events starting with the recent IND clearance for our U. KIDNEY clinical trial, this trial is the first FDA cleared registration supporting clinical and could provide an opportunity to put an end to dialysis for the hundreds of thousands of patients with end stage renal disease who cannot qualify for a human kidney transplant or who have little chance of obtaining one before their health declines.

We expect the first transplant in the middle of this year Last month, we completed enrollment of the inhaled treprostinil TETON-one study in idiopathic pulmonary fibrosis. We expect top line data from the TETON-two study in the second half This year, and TETON1 top line data in the first half of twenty twenty six. Treprostinil, which has been scientifically demonstrated to be anti fibrotic, anti proliferative and anti inflammatory is far more than just a vasodilator. We believe its multifactorial mechanisms of action could be complementary to existing approved IPF agents and even to many of the potential IPF drugs in late stage development. IPF is extremely hard to treat but we are encouraged with the success we saw in a post hoc analysis of IPF patients with pulmonary hypertension in the INCREASE study. Our goal is to bring this potential innovation to market as quickly as possible to patients in need of some things additional to existing therapies on the market. And that's not all. We're tremendously excited for the potential of ROLENAPAG to be the first true once a day oral prostacyclin agonist for pulmonary arterial hypertension patients. If successful, Ralinepag could fundamentally change the positioning of prostacyclins in the PAH treatment paradigm potentially leading to the upfront use of prostacyclins in PAH.

As an example of the potential for Ralinepag, SLEXIPAG, a twice daily oral prostacyclin agonist, logs more than $1,500,000,000 in annual U. S. Sales. And this is for a twice daily oral product with a dose ceiling. Unlike ROLONTAPAG, we expect to conclude enrollment in the ADVANCE OUTCOME study later this year allowing for top line data in 2026. Literature has long suggested that earlier prostacyclin use leads to better results. And the once a day oral would complement traditional ERA and PDE5 orals that PAH patients generally use for first line therapy. Any one of these potential products, u kidney, inhaled treprostinil for IPF or Ralinepag, could fundamentally change how patients with ESRD, IPF or PAH respectively are treated and each represents a multibillion dollar revenue opportunity for us. We've posted record revenue performance, progressed several registration studies and launched the first revolutionary trial of a xeno organ we remain focused on the needs of you, our shareholders, through a disciplined financial algorithm and capital allocation philosophy. In the past five quarters, we have touched on all three areas of our capital allocation philosophy across both our commercial and development portfolios. We've invested in CapEx to support our new Tyvaso DPI manufacturing facility and acquired additional real estate to support future commercial manufacturing needs.

We also commissioned the world's first clinical scale DPF in Virginia and plan to complete two others On corporate development, we acquired IVVA and MirrorMatrix to enhance our organ alternative development expertise. And we've licensed in new technologies to support our treprostinil business. And with all this, we still returned $1,000,000,000 to you, her shareholders, through an accelerated share repurchase program that was universally well received we will continue to evaluate all three core areas on an ongoing basis Record performance progress with our innovative and revolutionary development programs disciplined financial management and capital allocation We've never been in a better position at United Therapeutics and we're excited to forge ahead in 2025. And with that, I'll now turn the call over to our President, Mike Benkowitz, who will give an overview of our commercial performance for the quarter. Mike, Thank you, Martin, and good morning, everyone. Today, as Martine mentioned, we are pleased to report another year of record breaking revenue driven by double digit percent revenue growth for all our major revenue contributors. Tyvaso, U. S. Remodulin, Orenitram and Unituxin. Leading to almost 24% growth over full year 2023. The quarter, we saw 20% revenue growth from the fourth quarter twenty twenty three and saw record total Tuprostinil referrals, and patient shipments along with near record total start.

Our fourth quarter total net revenue was down slightly sequentially, while our gross revenues for the fourth quarter was record setting. The modest decline in net revenue is due in part to our recent contracting efforts Tyvaso, which I will discuss in a moment. Total TYVESO revenue for the fourth quarter was $416,000,000 a 19% increase over the previous year. This continued strong commercial execution in what is normally a seasonally challenging quarter was driven by record patient shipments and near record referrals and starts, largely on par with the previous quarter. The sequential decline in Tyvaso revenue from 3Q to 4Q was primarily driven by a larger gross net deduction associated with our recent contracting efforts that we've been highlighting for the last few quarters. Our investment in these contracting efforts was conducted to help position nebulized Tyvaso and Tyvaso DPI at parity with current and potential future competitor products. As we have previously noted, these new contracts became effective over the third and fourth quarters of twenty twenty four and we saw this impact primarily in the fourth quarter. At this point, we believe these additional investments and rebates have largely been pulled through creating a new base from which Tyvaso can continue to grow. [indiscernible] Moving to our retrotrim, we reported 28% revenue growth in the fourth quarter of twenty twenty four to $108,000,000 largely in line with the third quarter of twenty twenty four and again what is normally a seasonally weak fourth quarter for specialty pharmacy ordering.

In the fourth quarter, we saw record patient shipments for Orenitram. Close to 50% of Orenitram starts are now coming from remodel and transition. Indicating to us that our educational efforts around use with intermediate high risk patients needing additional PAH treatment along with scientific discussions about the expedite study are influencing Orenitram use. Moving to Remodulin. We reported fourth quarter worldwide revenue of $135,000,000 up 17% from the prior year period. U. S. Revenue grew 11% setting another record for patient shipments. We continue to see strong referral and start trends for Remodulin. In January, our partner, DECA, received FDA clearance for the new immunity pump. RemUnity Pro is the next generation in subcutaneous pump technology optimized and designed for patients with PAH. RemUnity Pro built on our unique RemUnity pump platform with features designed with input from PAH practitioners and patients to further simplify daily use. Compared to Rimunity, Rimunity Pro offers broader accessibility through intuitive technology and incorporates a touchscreen remote with step by step guidance. Streamlined alerts, simplified patient filling, and automatic pump driven We expect to launch from ImmunityPro later this year. Finally, Unituxin achieved record revenue of $68,000,000 for the fourth quarter, up 25% from the prior year quarter.

U. S. Revenue for Unituxan was $62,000,000 driven by both price and volume increase. Is This growth demonstrates the product's strong market presence, presence and the effectiveness of our commercial strategies. To wrap up, we are extremely proud of our team's accomplishments this quarter as the underlying dynamics of our business remain And with the recent investment in our commercial contracting efforts, we believe we are well positioned to continue providing our important medicines to patients while delivering value to our shareholders. Martin, I'll turn things back to you to run the Q and A. A. Thank you very much, Mike. Operator, please open the lines to any questions.

Our first question comes from Roger Song of Jefferies. Go ahead please. Great. Congrats for the quarter. Thank you for taking our question. Maybe start with the top line commercial franchise. Given you don't provide 2025 sales guidance, can we understand the growth trajectory for the year. And then also you mentioned some seasonality 4Q. And then how should we think about This year, in the upcoming quarters and then I have your one or two pipeline questions. Thank you. Thank you, Roger, for the kudos and I'll bounce that question to Mike.

Sure. So I think as you kind of think about 2025 and beyond as it relates to our what we call our foundation business, which is our existing commercial portfolio of products. I think what we've been saying for the last [indiscernible] last couple of years really is that we expect to continue to grow double digits into the mid decade and then obviously with expected at Rillenopec and IPF approval for TYVEYSEO, we can [indiscernible] That gross reduction you should should inflect in a meaningful way. So really even with the contracting efforts, we employed over the last couple of quarters or that went to effect over the last couple of quarters we really see no change in that in that perspective in terms of of the base business for the next year or two years. So we're just going to continue to execute commercially. And like I said, deliver that double digit revenue growth performance.

Perfect answer, Michael. Thank you. Operator, next question.

The next question comes from Jessica Fye of JPMorgan. Go ahead please.

Great. Good morning. Thanks for taking my question. So with the first transplant for the ukidney clinical trial expected mid year, you talk about what you'll be looking for to support proceeding to the next I think there's a waiting period in between the first and the second. Then just talk about what proof points in that program what ungate larger scale investment in additional DPS facilities? Thank you.

Thanks, Jessica. Nice to hear your voice this morning. And I'll flip that question over to Doug Peterson, our EVP Xeno.

Great.

Yes. Yes. Hi. Yes. So as you mentioned, we have this is a single phase list study and it starts with a cohort of six participants. And then we have a twelve week review period where we will be involving well, we're actually involving our DSMB, which is our independent data safety monitoring committee as well as our steering committee throughout the study because it's open label, but we'll have a formal review of all of the data data safety data and as well as patient and graft survival data at that point and determine the risk benefit ratio of going forward. Into the remainder of the what we have a planned of up to 50 patients. And as far as the endpoints or the demonstration of success, going to be looking again at a six month graph survival rates, patient survival rates as well as several parameters of of kidney function and then of course of safety which includes transmission of infections including potential zoonotic infections. Lee, that's a great answer. Thank you so much.

And Jeff, in terms of additional spending on DPF facilities, it premature to speculate on that, but it will just be something that we'll consider as the trial proceeds. Operator, next question?

The next question from Ash Verma of UBS. Hi. Thanks for taking my question. I wanted to understand Wind River to your business? This study finished earlier than expected.

And in the past, I understand that you've talked about that the minimally rare late line and combo therapy used with some of your products was kind of insulating your pH position. But now that Winderwear moves earlier line and faster than expected, can ThaiVASO still grow on the PA side? Thanks.

Thank you, Ash, for dialing in this morning. Mike, I think that would be the best person to answer that question.

Sure. So I think in terms of the Hyperion study, I mean, obviously, we'll see how that plays out over the next couple of quarters. As I said in the answer to the first question, we still expect that we're going to continue to grow double digits across our franchise. I do not think as we said all along, Wind River is not a a it's not a cure. It's definitely an addition to the the PAH treatment armamentarium. Which is great for patients. It doesn't replace prostacyclin. I think what we we've seen up till now is that's being used in combination with prostacyclin. I think that will continue to be the case if for whatever reason physicians start to move use when we're here, head of prostacyclin over the long term I think that's immaterial because PAH continues to be a progressive disease and whether patients start on procyclicline before or after winRevear eventually they're going to get to prostacyclin. So as we kind of think about our business over the long term, we think the impact is going to be really be immaterial.

Excellent, Michael. Operator, next question. The next question comes from Joseph Toome of TD Cohen. Go ahead please.

Hi there. Good morning. Thank you for taking my question and congrats on the progress. Maybe another on the xenotransplant. Can you put into context the baseline disease severity of the first patients that will be enrolled maybe as it relates to kind of the baseline disease severity of Tuatulunie And then related to that, we've obviously been able to follow these patients progress through either press releases from the hospitals themselves or new sources. I guess, do you expect this to continue in the formal clinical study as early as yesterday? It seems like mezzanine was able to return home. We can kind of watch this as it happens. Is that going to be the case in the formal study as well? Thank you.

Thank you, Joe. I think Doctor. Peterson could give you a very good answer on that question.

Yes. So I think you're your second question was about how we will follow our clinical study patients with regard to the news and what's been shown with Ms. Looney.

We will not be doing that. Our For clinical studies, the data are there's patient privacy. It will not be the same as what you've seen with this EIND case. It will be more like a traditional clinical study where you don't have names and you don't follow that. As far as the eligibility, we it will our eligibility includes two populations of patients. One are patients who are not eligible for the current kidney transplant waitlist And but They don't have several comorbidities, like very they're not very, very sick patients, probably like you're asking specifically about the first two heart patients. Our patients won't have severe cardiovascular comorbidities as well as several other. So [indiscernible] But again, they won't be eligible for the list due to medical reasons. And then we also have a second population, which probably Ms. Looney would fall into, which is that they are not an Allo transplant due to things such as HLA sensitization or or other factors Type O blood, or a combination of these factors. They're not expected to get an allo transplant for at least five years. And so this is a second population where again they're on the list but they're not expected to really to have a good chance of receiving an allo transplant.

So I hope that gives you a little bit of an indication. Again, in comparison to Ms. Looney, where you've really been able to follow her status, which is really great. We're really really happy to help patients like her and and Probably the second category is very similar to of patients It's very similar to to what you understand and what we understand [indiscernible] Thank you, Doctor. Peterson. Superb three sixty degree answer. Next question [indiscernible] The next question comes from Roanna Ruiz of Leerink. Go ahead please. Great.

Good morning, everyone. So question about Tyvaso in PH ILD specifically. Could prescribing growth on the ILD side plus increase in commercial volumes under Part D redesign possibly outweigh some seasonality trends from 1Q going to 2Q? Just curious if any color on that?

Very interesting question, Roanna. Michael, can you answer that?

Sure. I think in terms of the the first part of the question around PHILB growth, as you recall, We expanded our sales force coming into 2024 really to try and drive [indiscernible] drive prescribing growth in the PHILD or in the I'm sorry, in the ILD treaters, those physicians that are seeing the PHILD patients. So it'll be prior to that, or at least at launch and up till that, think what we were seeing is the vast majority of PHILD patients were being referred to pulmonary hypertension clinics and it was those physicians that were that we're prescribing prescribing Tyvaso. And so but as think of the patient population, that really wasn't a sustainable model going forward if we really were going to have impact and be able to penetrate the market. So that was really sort of the idea behind the expansion was to really start to continue to educate the ILD treaters on not only the disease, but how to use Tyvaso, how to start managing these patients. And so I will say that that so far has paid off in spades.

If you look at our prescriber growth, over the course of 2024, the majority of that growth is in the ILD treating community. So we are starting to get We're starting to get the breadth of prescribers in in that group and then actually starting to get make some end roads on the depth I talk often about the three plus doctors that get to three plus patients, then they quickly jump up to six, seven, eight, nine, 10 patients. So So we're having a lot of success both in terms of the growth of the breadth of the prescribers and starting to get more depth among prescribers. And so I think we just expect that to continue as [indiscernible] And beyond. And I was just looking at calculating if you look at patient growth between PHILB and and PAH. The nice thing is with Tyvaso is we're actually growing on both indications. So in 2024, we grew roughly, I think it was about 37%, 35% to 40% in PHILD, still a mid teen growth in PAH. So it's nice to see that we're growing in both indications. So I think hopefully that addresses the first part of your question around prescriber growth and then growth in PHYLE versus PAH.

As it relates to Part D impact, I think as we said for the last couple of quarters, I think that largely played out last year. So we saw in Q1, we saw more patients or patient assistance patients convert over to to commercial paying patients in Q1 of twenty four and then that continued over the course of the year. We kind of settled it at about roughly 90% of our patients are commercial paying patients and then 10% are in our roughly 10% are in our PAP program. I would expect that that's going to be kind of new normal or new baseline going forward. Bounce around a little bit quarter to quarter or just depending on the type of patient we're getting in. But generally, I would expect to kind of settle in around that. So I'm not expecting to see much of an impact in Q1 or Q2 as a result of the [indiscernible] Excellent. Michael, your encyclopedic knowledge is a benefit to all of us. Thank you so much. Really appreciate it. Operator, we only have time for one last question and whoever that may be, maybe it will be a question for our Chief Financial Officer since this is an earnings call.

Next question, operator?

Okay. The next question comes from Andres Aguirrez. Go ahead please.

Thanks. Good morning and thanks for taking our question and Martin, apologies, you put me on the spot on the financial question. I don't think I had that one teed up here. But first of all, kudos to the the great year.

And also to the milestone on getting IND clearance [indiscernible] it's pretty fascinating and interesting going forward here. And following Tawana's Progress here, Hearing Messaging's resume daily activities is a kudos to the team. My question was really just quickly around Hi, VISO. And IPS getting a sense of the intellectual property you've built around that, how long you can expect exclusivity And then quickly on contracting and some of the competitive dynamics behind that, I don't know if I squeezed two in there, but apologies for that. Yes. Okay. Well, thank you, Andreas.

We appreciate your kudos. You're off the hook on the question for James.

We don't really like to discuss publicly the issues relating to IP and whatnot and about out of time, so I'm going to ask just Michael If he could talk about the contracting aspects of our anticipated launch into IPF. Michael?

Yes. So Andre, I'm not sure if it was the question was related directly to contracting an IPF or just contracting generally or what we've done thus far. But really, I think the philosophy that we and the strategy we employed last year was to start to lock in payers with some additional rebates in anticipation of future competitors. And then the idea behind that is if we start to have those rebate dollars flowing through regardless of where the potential competitor comes in with with rebates, we have dollars flowing through. And so that puts us, I think, we think, in a stronger position keeps us at parity. I think payers will be less reluctant I'm sorry, less likely, more reluctant to enter into contracts that would disadvantage us because at that point they'd basically be turning off the spigot to the rebate dollar. So that was really the idea behind the payer strategy, which is get the rebates place, start to get those dollars flowing, keep us at parity with competitors and then we feel like if we're really and then have the discussion with the clinicians around what's the better product for their patients and we feel very strongly that we're better positioned and very well positioned to succeed on that front.

Thank you, Mike. Perfect answer. Operator, you may now wrap up the call.

Thank you for participating in today's United Therapeutics Corporation Earnings Webcast. A rebroadcast of this webcast will be available for replay for one week by visiting the Events and Presentations section of the United Therapeutics Investor Relations website at ir.ir.unither. Thank you.