Madrigal Pharmaceuticals, Inc. Common Stock Q2 2026 Earnings Call

Good morning, and thank you for standing by. Welcome to Madrigal Pharmaceuticals Second quarter 2020 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. To ask a question during the session. You will have to press star one one on your telephone. You will then hear an automated message advising that your hand is raised. To withdraw your question, please press star one one again. Please be advised that today's conference call is being recorded. I would now like to introduce Miss Tina Ventura, Chief Investor Relations Officer. Please go ahead.

Good morning, everyone, and thank you for joining us to discuss Madrigal's second quarter 2026 results. We issued a press release this morning and posted a slide deck to accompany this webcast on the Investor Relations section of our website. On the call with me today is Bill Sibold, Chief Executive Officer Dave Soergel, Chief Medical Officer and Mardi Dier, Chief Financial Officer. They will provide prepared remarks followed by Q&A. Please note on slide two, we will be making certain forward looking statements today. We refer you to our SEC filings for a discussion of the risks that may cause actual results to differ from the forward looking statements. With that, I will now turn the call over to Bill. On slide three. Thanks, Tina and thank you all for joining. Before we review our second quarter results, let me let me remind you why we're so excited about Mash and why we believe Madrigal is uniquely positioned to lead this market. The market fundamentals are exceptional. Mash is a high unmet need disease with the potential for decades of growth. Given today's low diagnosis and treatment rates and a rapidly expanding patient population. We are at the forefront of one of the most attractive growth opportunities in the industry.

We also have what we believe is the foundational therapy. Rezdiffra is the first approved medicine for Mash, a liver directed, once daily oral medication, with demonstrated efficacy across each Mash subgroup and an outstanding real world profile. Add to that our commercial execution, our experienced team and our industry leading pipeline. We believe Madrigal is exceptionally well positioned to lead in Mash today and define where this market goes over the long term Slide four summarizes how we're executing on our two strategic growth priorities. Maximizing the value of rezdiffra, and advancing our pipeline Rezdiffra continues to exceed expectations as we steadily add patients quarter over quarter over the last 12 months. Rezdiffra has generated nearly $1.3 billion in net sales, reinforcing its megablockbuster potential. We're also strengthening the long term value of the franchise. A key pillar of that strategy has been to build a robust patent estate. Last year, we secured our pivotal 2045 F2 F3 patent. This month, we build on that foundation with three additional patents, two that reinforce our protection and F2, F3 and one supporting our potential F4, see indication As we've done successfully to date, we'll continue pursuing IP that protects the future of Deciphera.

And because we believe Rezdiffra is the foundational therapy in what will become a large specialty market. We're investing behind. It. In less than a year, we built what we believe is the industry leading Nash Pipeline, adding more than ten programs. We now have four clinical stage assets. Following the initiation of the phase one study of our oral GLP one last month, each of our programs is designed to build on Rezdiffra foundation and extend our leadership in Nash for years to come. We've. Accomplished a tremendous amount in a short period of time, but we're just getting started. Our team continues to execute on these priorities to strengthen the leadership position we've established. Let's move to our Q2 results, where I'll provide an update on Rezdiffra. Dave will discuss our pipeline, and Mardi will close with a review of our financials. Turning to slide six and net sales, we are continuing to see strong demand for Rezdiffra second quarter 2026. Net sales were $364 million, representing year over year growth of 71%. This. Continues to reinforce that Defra is tracking in line with, and in many cases, exceeding the best in class specialty launches. We compare ourselves to.

Our strong performance is a result of successful launch execution. It's driving our near results and building the foundation for the long term growth we have. Effectively wired the system to build a broad and durable prescriber base and importantly, prescribers continue to tell us that Rezdiffra is performing even better in the real world and that experience is translating into action. Today. Our target specialists are prescribing rezdiffra more often, which is driving greater depth across our prescriber base. That growth. Depth, combined with broad first line commercial access as differs differentiated profile and strong patient adherence, continues to drive patient growth. That's why we've steadily added patients, ending the second quarter with more than 49,000 active patients on Rezdiffra more than double a year ago Importantly, momentum remains strong as we progress through the third quarter, where we surpassed the 5000 patient milestone earlier this month. A significant accomplishment in any launch. One of the things we're most excited about is how quickly this market is developing. As shown on slide eight. From year end 2023 to year end 2025, the US addressable market has grown nearly 50% from 315,000 diagnosed F2, F3 patients at our target specialists to 460,000.

That's remarkable growth in just two years, and it's being driven by exactly what you would expect in a new therapeutic category. Greater disease awareness, increasing diagnosis, more patients being referred to specialists, a growing urgency to treat and increased investment by multiple companies. We have continued to see strong market growth again this year and expect the mass market to expand at a double digit pace for the foreseeable future. In. Fact, we see parallels between mashed and other large chronic disease markets like rheumatoid arthritis. IBD, and psoriasis, as shown on slide nine. Each started with 1 or 2 therapies and evolved into markets supporting more than a dozen products and more than $20 billion in annual sales We believe that Mash will follow the same path, and that differ has a stronger profile than the first products that launched in any of those categories. And today. We're only about 10% penetrated in a market with a roughly 10% diagnosis rate. Think about that. 10% of 10%. That's 1% of the total potential market. Yet even from that starting point, as shown on slide 11. Rezdiffra is already generating north of $1 billion in trailing 12 month net sales. That's why we're so excited about the future.

We are still at the beginning of what we believe will become one of the largest specialty markets in the industry, where we have a first to market medicine with a best in disease profile. Everything I've discussed so far speaks to the strength and opportunity of rezdiffra in F2, f3 mash. But there is another significant unmet need ahead of us in Well-compensated mash, cirrhosis or F4. As noted on slide 12. It's an untapped market with no approved therapies and a much higher urgency to treat with approximately 245 thousand patients under specialist care in the U.S., we believe F-4c could double dippers opportunity. We have an event driven outcome trial underway in F-4c that if positive, is expected to support expansion into this indication and support full approval across F2 to F-4c. And we see the market evolving beyond these initial stages. As noted on slide 13, like other complex chronic diseases, treatment will evolve to include multiple mechanisms. Combination regimens, and increasingly personalized approaches Thats why we've strategically invested in building the industry leading Mash pipeline. Rezdiffra gives us a foundation no one else has, allowing us to thoughtfully add complementary mechanisms that can provide even more efficacy, broaden patient reach, and define the next generation of Mash therapies.

And one of the reasons we believe Rezdiffra is foundational is what we've heard consistently from prescribers over the last two years of launch. They not only value its liver directed efficacy while tolerated profile. And once daily dosing, but appreciate that differ works across each patient subgroup in clinical practice, that breadth and consistency across patient subgroups is exactly what you want in a foundational medicine, and it's unique to differ Dave. We'll talk more about this in his section and share key data demonstrating risk differs broad efficacy. So with that, I'll turn it over to Dave. Thanks, Bill. As Bill just mentioned, for a therapy to be truly foundational, it should work effectively across patient patient subgroups. This is especially true in heterogeneous disease like match. The forest plot on slide 14 with data from our phase three Maestro Nash clinical trial demonstrates exactly that patients on risk differ consistently demonstrated improvements across key subgroups, including fibrosis, stage. Diabetes status, BMI, and genetic background risk factors that may expedite disease progression This is another way in which we are differentiating ourselves from the competition and why health care providers overwhelmingly prescribe recipro when the patient is diagnosed with F2 or F3.

Nash. But we're not standing still. Leadership means continuing to advance the science and generating evidence that supports risk differs clinical benefit well beyond approval. It's an ongoing effort to better understand risk differe and. Answer important clinical questions and continue to raise the bar for what's possible in Nash. At. Easl. This year we presented more Mash abstracts than any other company. I'll highlight three presentations that reinforce our belief that Rezdiffra is the foundational therapy in Nash. First is our F-4c analysis on slide 15 using the anticipate. Nash risk model. Anticipate. Nash is a validated model developed specifically for patients with Nash cirrhosis. It estimates the patient's likelihood of developing clinically significant portal hypertension, or csph, and future liver related events. The. Marshfield is rapidly evolving, and this model is becoming increasingly accepted. Tool for assessing risk in patients with compensated cirrhosis. This is an emerging area of science, and we are an early adopter of this new tool. That's an important part of how we approach leadership at Madrigal. We're not simply following the evolution of the field, but we're helping pioneer new ways to understand treatment response and disease progression. We applied the anticipate Nash model to the 122 patient, two year open label cohort from our phase three maestro, NAFLD one trial.

The proportion of patients classified as high risk for Csph declined from 75% at baseline to 55% at two years of resmetirom treatment. Why is this important? The development of portal hypertension is the key. Pathophysiological inflection point in compensated cirrhosis. Once. Patients progress to csph their risk of decompensation and other serious liver related events increases by approximately five fold. These findings further strengthen our confidence that Resmetirom has the potential to delay disease progression and improve long term outcomes in patients with f-4c mash. The second data set extends our understanding of risk differe beyond the liver. Patients with F2, F3, mash don't just have liver disease. They also carry substantial cardiometabolic risk. In fact, cardiovascular disease remains the leading cause of death in this population and Mash itself is an independent driver of cardiovascular risk. Our. Secondary analysis from Maestro Nash and Maestro NAFLD one showed significant reductions in Apob, including LP, little and LDL. Regardless of baseline statin use. Taken together, these data suggest that may positively impact both liver disease and cardiovascular risk. Slide 17 highlights rates, differs performance in the real world. Clinical trials establish efficacy. Real world experience builds. Prescriber confidence after treating tens of thousands of patients, prescribers continue to tell US risk differ as performing even better than they expected.

The. Data at Easl support those observations in one large gastroenterology practice over a mean follow up period of approximately nine months, nearly half the patients achieved at least a 25% reduction in liver stiffness, a key measure of treatment response. Real world evidence like this complements what we've already seen in our clinical trials and reinforces Rezdiffra best in disease profile. To. Deepen our understanding of risk difference. Full clinical potential. We're broadening our evidence generation efforts across real world studies. Investigator initiated research and company sponsored trials. We will continue to pursue the questions that matter most to physicians and patients, and work to generate new data that can further inform how Mash is diagnosed, treated and managed. Putting it all together on slide 19, we've translated our leadership into action. In just one year, we built the industry's leading Nash pipeline with more than ten programs, including four clinical stage assets, all anchored by Rezdiffra. This momentum will continue into 2027, when we expect to initiate three phase two trials. The first will evaluate Merle 206, our oral GLP one, in combination with Resmetirom. Our goal is to potentiate Resmetirom anti-fibrotic effects. We began dosing mg L 206 in a phase one single ascending dose study in June.

Results from this first in human study will inform the phase two trial. We also plan to initiate a phase two study of our Dgat two inhibitor, or Ergostat, in combination with Resmetirom, and will engage with regulatory authorities on the design of a phase two trial combining Resmetirom with MG L 0795. R s RNA targeting Pnpla3 in-licensed from Arrowhead in May. We also. Are progressing one of the six preclinical siRNA assets that we in-licensed from Rebecca. We recently nominated the first candidate to move into IND enabling studies. All. Of this is advancing alongside our two ongoing phase three Rezdiffra trials. First, our F-4c Maestro outcome study, which is an event driven trial that we expect to read out in 2027. And second, the F2, F3 Maestro Nash study, which is primarily histology driven with data expected in 2028. We've made significant progress in a very short period of time with recipients of foundation and long term patent protection providing the runway to invest and innovate. We have an opportunity to define the future of Nash care and meaningfully improve the lives of patients. With that, I'll hand it over to Mardi. Thank you Dave. Turning to slide 20 and a summary of our financial results.

We delivered another strong quarter with second quarter 2026 net sales of $364.3 million, representing 71% growth year over year. Demand for Rezdiffra remains strong. We once again steadily added patients, more than doubling patients on Rezdiffra compared to a year ago. We also continued to effectively manage growth to net and continue to expect our gross net discount to be in the mid to high 30s for this year, taken together, these fundamentals support our expectation for continued steady patient adds and robust net sales growth. Moving to operating expenses, which included a total of $35.4 million of non-cash stock based compensation expense in the quarter, compared to $25.2 million in the prior year period. Cost of sales for the second quarter of 2026 was $40 million, compared to $9.1 million for the prior year period. Cost of sales was primarily driven by an increase in royalties payable to Roche and a write down of certain work in process inventory. R&D expenses for the second quarter of 2026 were $91.2 million, compared to $54.1 million for the prior year period. The increase was primarily due to a one time upfront business development expense of $25 million. Related to the in-licensing of MG L 0795, a clinical stage S I program from Arrowhead sG&A expense.

For the second quarter of 2026 were $289.4 million, compared to $196.9 million for the prior year period. The increase was primarily due to continued investment in commercial activities for Rezdiffra, including headcount for the endocrinology, field force expansion that occurred in the fourth quarter of 2025, as well as marketing efforts including our DTC campaign Looking ahead, we expect full year 2026 R&D expenses to be roughly the same as 2025, which is inclusive of the one time upfront payments we've announced for strategic business development investments in both periods, we expect a full year 2026 G&A expenses to increase compared to 2025, with the annualized return of the Indo Sales force. As we continue to support the launch of our and build the foundation for long term growth Net loss for the second quarter of 2026 was $57.9 million, compared to $42.3 million for the prior year period. Net loss for the second quarter was inclusive of a one time upfront business development expense of $25 million, while our focus remains on supporting our top line growth and building our pipeline, we are also preparing for profitability. Turning to our balance sheet, we ended the second quarter of 2026 with $838.9 million in cash, cash equivalents, restricted cash and marketable securities compared to $988.6 million at year end 2025, with a strong cash position, we continue to be well resourced to support the ongoing launch of Rezdiffra, the advancement of multiple pipeline programs, and continued business development.

So to conclude on slide 21, we believe Madrigal is exceptionally well positioned for continued value creation, with nearly $1.3 billion in trailing 12 month net sales, with difference on its way to Megablockbuster status. And as Bill said, the third quarter is off to a great start. We've more than doubled the number of patients on therapy over the past year. While the addressable market itself has expanded by nearly 50% in just two years. And we believe it's still in the early stages of what will be decades of growth. We're building on foundation with the industry leading pipeline of more than ten programs. We look forward to multiple future data readouts, including our phase three F4 trial. We're investing from a position of strength with an R&D strategy designed to extend our leadership and create long term value. Taken together, we believe Madrigal is exceptionally well positioned not only for continued growth in 2026, but for sustained value creation for many years to come. I'll now turn the call back over to Tina to begin the Q&A session.

Thanks. Mardi. Let's move into the Q&A portion of the call. Operator. Please go ahead and provide instructions for the Q&A session.

Thank you very much. At this time, we will conduct a question and answer session. As a reminder to ask a question, you need to press star one one on your telephone and wait for your name to be announced. To withdraw your question, please press star one one again. Please stand by while we compile the Q&A roster. Our first question comes from the line of Prakhar Agarwal of Cantor Fitzgerald. Your line is open.

Hi. Congrats on the quarter and thank you so much for taking my questions. I had two. Firstly, I wanted to ask about the three key trends. What are you seeing? And expectations for? Net patient ads for remainder of the year? Just wanted to get a little bit color on what segments are going to drive further growth here. And how do you feel about where the consensus is sitting for three Q and full year 2026? And second question. You started targeting endocrinologists last year. Any initial thoughts on what you are seeing on the uptake among endocrinologists? Could that be a meaningful growth segment or is it more niche right now? Thank you.

Thanks for the question, Prakhar. It's Bill. Maybe just a comment on where we are year to date here we had really, I think, an exceptional quarter in Q2. That was driven by exceptional execution, exceptional market dynamics. And I think that is really the best indicator of where we're headed for the future. The fundamentals of the business are terrific. We have great access. 2026 is going to be another great year. As you know, we exceeded Q2 expectations. Q3 is off to a great start. You know we have said and we continue to steadily add patients with 49/49,000 patients at the end of Q2, more than doubling year over year. Patient numbers. And, you know, we did announce this 50,000 milestone, which that is a really remarkable number in any launch. I don't care whether you're in a specialty launch. Non-specialty launch 50,000 represents great progress. And that's something that we crossed in. July So we continue now. Looking forward to Q3 and beyond to steadily add patients. We've been steadily adding we're going to continue to steadily add patients through third quarter and through the rest of the year. So I think we're set up really well for 26.

But Marty, do you want to talk maybe a little bit about some of the specifics?

Yes, absolutely. And high Prakhar and good morning, everyone. As Bill said, we're off to a great start in third quarter. And we're going to expect to steadily add patients as he discussed and with respect to third quarter and fourth quarter, what we'd like to say is that, yes, we're we're comfortable with the consensus quarterly growth rates for the rest of the year. So that means from going the growth rate, the consensus growth rate from second quarter to third quarter. And then again, the consensus growth rate from third quarter to fourth quarter. So taken together, just as we've said, robust sales growth for 2026.

And Prakhar, just to talk about kind of the segments where it's coming from, you know, this continues to be driven by Heps and GIS for the most part. That's just where the prescriptions have been, where we would expect that they're going to continue. You also asked about endocrinology. Endocrinology. Endocrinology was a fourth quarter 2025 focus of ours. So, you know, we're still really early into that. And you have to remember endocrinologists just I'll make two quick points about them. Number one, they've been using GLP one for over a decade, and they still are seeing lots of Mash and want to talk about different. You know, check that box. Number two, they just got started really in the fourth quarter of last year. So they're in kind of that first year of launch. And Hepes and they have to take their own time to wire the system, know how they're going to access their. NITs. What's the pathway they have for their practice. So lots of potential in endocrinology in time, but you have to just know where they are. They're kind of nine months into the launch really at this point, but a lot, certainly very promising.

Thanks.

Great. Thanks, Prakhar. Cary, next question please.

Thank you very much. Our next question. Comes from the line of Ellie Merle of Barclays. Your line is open.

Hey, guys. Thanks for taking the question and congrats on the strong performance., just in terms of patient growth, it seemed to accelerate versus the first quarter, I guess, what are the drivers of this and your expectations for patient growth from here., and then just in terms of F-4c, I guess, how is the event rate tracking in that study? And, any clarity on when in 2027, you might expect to release the data? I recognize you might not comment, but figured I would try. Thanks.

Thanks, Ellie. Thanks for the question. On the patient growth. Now, I just wanted to make sure. Just to level set the way we report patient numbers is the number of patients that are on Reddit. On the last day of the quarter. And that is the net of patients that are coming in the top of the funnel. And patients that are going out the bottom of the funnel, right? I mean, you know, and you get a bigger and bigger denominator, you have more and more patients exposed to us. Potentially dropping off. Now, the great news is here is that we continue to steadily add patients. As you know, as I've said, and we don't see that slowing down at all. But remember, you really have to do work a lot harder on the top of the funnel as you have a bigger denominator that patients can fall out of. We're seeing persistency like a well oral, a well oral at the one year mark is in that 60 to 70% range., no changes there. Product's been performing exceptionally well. When we talk to the community, we hear stories of persistence, which are even higher than that. So we have focused our efforts with our internal teams on how do you address persistency to have,, you more patients stay on longer?

And then how do we work with specialty pharmacies, pharmacies, etc., to get that same result? So it's, you know, a real focus of ours to drive the top of the funnel, adding new patients and to keep patients on. And then we get to that net number. And we think that we have a really good. Approach. And that's why we continue to say we expect to steadily add ,, maybe Dave, I'll turn to you on efficacy. Yeah, sure.

Hi, Ellie., yeah.

A quick update. So,, I mean, clearly my outcomes is an important trial for the field given the unmet medical need and the fact that this is going to be the first outcomes trial in F-4c to readout with outcomes, which is, you know, a big a big thing for the field., so the good news is we're seeing events accrue in the trial. However, as we said in the past, you know, this isn't,, you know, like, for example, a cardiovascular outcome study where you have a large number of target events,, so in this case, precision is very difficult. And when we can be more precise, we'll provide, you, we'll provide you an update at that point. But right now we're tracking to 2027, as we said.

Great. Thanks, Ellie. Corey. Next question please.

Thank you very much. Our next question comes from the line of Thomas Smith Thomas. Your line is open.

Hey guys. Good morning. Congrats on the nice quarter here and thanks for taking our questions. I was wondering if you could clarify and maybe expand on the comments regarding gross to net and inventory dynamics in the quarter and how you see those evolving through the balance of 26. And then,, could you also clarify the contribution of Europe to the worldwide revenues and patient numbers? We saw there was an early access program that launched in France during the quarter. And anecdotally, from some Kohl's, it sounded like there's been some nice early uptake there. But can you just comment on that program and how you think about Europe contribution for the year? Thanks so much. Great.

Thanks, Marty, do you want to talk about gross?

Yeah, absolutely. So gross to net. As we said last quarter, our gross to net projected for 2026 is in the mid to high 30s. And,, we are right in that zone for two. Q and that's what we expect for the rest of the year. And that's really balanced with a, you know, mostly up with a high demand quarter .,, with respect to inventory, just as we have with every quarter, no big changes there., so overall, everything's going well for the rest of the year in 2026, as we've discussed,, what we believe the growth rate is for the rest of the year., in Europe. Do you want me to.

Yeah, I'll talk.

About, I'll talk about Europe.

Thanks for the question, Tom.

Look.

Contribution of Europe is negligible in the quarter. And we would expect that to be for the year. Now let me just talk a little bit. Just what comes in general. You know we've launched in Germany and as you say, we have the early access program in France, and we received approval in the U.K... A couple observations. This is not a US disease. It's a global disease. There's a high unmet need. Interest is really high from prescribers and from patients. Reimbursement is challenged. You remember, we're in an MFN context here where there is still uncertainty about where that all lands. And I think, you know, we're going to be in a period in the next 12 to 18 months where things are still settling down. So yeah, systems have not., when I say systems, other countries have not yet adopted what the ask is of the administration and MFM, which is paying US prices. So that's something that we're at the table, we're talking with all of the governments there about this., I'm really hopeful for a long term solution, but as I said, in this time where it's just kind of really dynamic and a lot of uncertainty as to where policy lands and so forth, you know, that's why we say it's going to be negligible.

But remember, we've only launched in Germany. That's where we've done our Bill. We've been extremely disciplined about the build and spend there. So you know, more to come in in the following quarters. But as I said, it's certainly is there certainly is a high unmet need. It's just we've got to solve the reimbursement piece. And this isn't a Madrigal specific issue. This is an industry issue overall.

Great.

Thanks, Tom. Corey, next question please.

Thank you very much. Our next question comes from the line of Ritu Baral of TD Cowen. Your line is open.

Good morning guys. Thanks for taking the question. I wanted to drill down a little further on outcomes for C. Time. And sort of the drivers there for, the data. Can you guys confirm that ,, per your design publication that you're still aiming for that 92 event threshold?, or is there a possibility that you might want to boost powering based on what you're seeing and based on further, just based on our conversations with Kols, they indicate to us that like events in F4 ,, tend to be. Be almost more asymptotic in the sense that they accumulate much, much more rapidly and, and barely at all in the, in the first part of the trial versus more sort of linear cardiac outcome study event accumulation. Can you comment on what the natural history tells you on that event accumulation curve and how that contributes to how you're approaching, giving us additional clarity and narrowing of data timing, guidance. Thanks.

Great. Thanks, Ritu. I'll pass that over to Dave.

Yeah. Thanks, Rita. Hi. How are you doing today?, you know, I think the first thing to comment on is we haven't actually confirmed the target number of events. So what we've said generally is there's there's a publication by Harrison that's a few years old. That was sort of,, you know, evaluating an earlier version of the protocol. And we've heard other numbers out there. What we said in general is, that, you know, most of these numbers are in the ballpark, but we haven't confirmed the actual the actual number., I think to your point about,, accumulation events, look, I mean, you know, we're pioneering in this space, you know, this, as we've said many times before, this is really the first. Well controlled F-4c outcomes trial with a therapeutic agent., so,, you know what? We've, we've, we've heard the same thing from Kohl's that the possibility is that,, that events accelerate over time as patients sort of age through the F-4c pathophysiology and the, the development of, for example, I think the good news is, like I said, you know, we're seeing events. Accrue. They're in line with our projected,, other completion. Date in 2027., so you know, when we can be more precise, we'll provide more precision.

But I think what you're highlighting is, is one of the, is one of the questions that's out there, right? So it's what, how does the placebo sort of evolve over time within a controlled trial?

Great. Thanks.

Thanks, Ritu. Thank you. Oh, yeah. Go ahead Corey. Next question.

Thank you very much. Our next question comes from the line of Andy Chen of Wolfe Research. Your line is open.

Hey, thank you for taking the question., so we noticed that you provided a timeline guidance on oral GLP one and the Dgat two. Just curious if what can you maybe tell us a bit more about the Arrowhead asset?, when is phase two going to begin?, and, and then with the oral GLP one,, the Sad has initiated,, is it reasonable to maybe predict that maybe we're going to get data next year? Thank you.

Great. Thanks, Andy. Dave.

Yeah. So, well, first of all, thanks. Thanks for the question, Andy. On the pipeline. I love it., you know, it's one of the main reasons why I came to matrigel sort of the opportunity to,, to build a pipeline in a space where there's so much potential and so much need. And what I love about our pipeline is that we have a diversity of mechanisms. And yet all the mechanisms we know a lot about already. So there's a lot of data on GLP one, there's a lot of data on Dgat. There's a lot of data on Pnpla3., so specifically with respect to the programs, all of these programs have been chosen because there's a strong scientific rationale for complementarity with thyroid hormone receptor beta agonism with, with resmetirom. So specifically for the oral GLP one, as you recall, we're developing the oral GLP one. Ultimately in combination with Resmetirom to dial in a little bit of weight loss to potentiate resmetirom efficacy., so as you pointed out, we started our Sad last month and we'll be running the sad and the mad sort of through this year is our plan. And then the data from that trial will then inform the phase two study, which after we talk to health authorities, would start in 2027., so timing with, with respect to timing, we haven't given a specific date to expect phase one.

But,, you know, that study will sort of proceed through through this year. Similar story with Dgat. We've talked about running a pretty straightforward drug drug interaction study later this year with Resmetirom and, and Ergostat., again, we know a lot about that because Pfizer took the compound through phase two. So we now we know it provides a lot of pdph reduction in patients with Nash and that pdph reduction could also potentiate resmetirom efficacy., so once we finish that drug drug interaction study again, go to health authorities, talk about our phase two plan and,, estimate to start that in 2027. Same story with Pnpla3., so that siRNA program that we licensed from Arrowhead, you know, we start with,, you know,, some very good phase one data where we have a good understanding of dose range,, with the molecule as a monotherapy., again, we'd have to go to health authorities to talk about the combination program. And again, estimating a start in 2027. We'll provide more of an update on the specific plans in phase two as we get closer to the initiation., but, but right now, just on based on where the programs are in their lifecycle, we'd expect them to start, start phase 2 in 27.

Yeah. And, you know, just maybe just a point on. The pipeline, right. We've, we brought in these assets to be used in combination with Risdiplam. And they pointed out in the presentation, as I said. As a foundational therapy, you see it working across various groups within,, within Mash consistently. So our objective is to find even more efficacy. Either in a subgroup or in the total Mash population. And you think about that in comparison to the rest of the industry or those that are participating in Mash, they have single assets that they're hoping, you know, still to readout, maybe positive data and maybe get approved and then be able to launch. They're going to be doing that and we're going to be already moving forward with our combo strategy, which is going to raise the bar for the entire field. But there's only one company that has raised different. I think that's a point that sometimes just doesn't get quite picked up or understood. We are starting from kind of that foundational therapy, which is the building block for Mash. Thanks for the question.

Thanks, Corey. Next question please.

Thank you very much. Our next question comes from the line of Yasmeen Rahimi of Piper Sandler. Your line is open.

Hi. Good morning team. Congrats on a great quarter., and all the color maybe ,, would. Love to get color as you guys have been. And I'm sure you're tracking ,, sort of event rates in the real world and the f two of three population, which is the indication, but maybe to the extent that you're seeing, you know, if there is any off label use in a force, any observations that are being made there, whether it's, you know,, consistent with the maestro, Ola data, which you reminded us of earlier today, just would love to get sort of real world experience. And I know it's limited and it's probably,, you know, occurring,, at a less extent, but appreciate any color around that ., and thank you. It seems like probably we could quantify, you know, like your confidence that the data is in 2027 and the likelihood that it could get pushed out into 2028, that could also be really helpful. Sorry for the very long winded question.

Yes, thanks for the question. I mean, maybe just a comment on kind of the real. World. What we're seeing in F2, F3. You know, it's it's you never know what's going to happen in the real world, right? You have your,, clinical studies they read out there, well controlled, everything is, you know, everything is controlled for patients. Stay on drug and you do your readout and you create a bar chart and everyone starts comparing against a bar chart. Then you get to the real world. And that's really what counts. How does the product perform and what we're hearing overwhelmingly from patients and prescribers, is that red zipper is performing exceptionally well. I don't hear stories of red difera not working, just and that's, you know, in and I speak, as you know, to hundreds of physicians, hundreds of prescribers. And I have not heard anyone say Bill. It isn't working. What I hear is that this is working better than I even thought it would. It is a. Effective? Well. Tolerated. Safe. Easy to use. Supported by a great patient. Support program that we have here. So, you know, we really take care of patients. Take care of prescribers.

So early feedback and we're seeing it also in real world evidence as being reported. It's a product is performing really, really well. And you know, that's exciting. You never know that. So, you know, as you think about, as I said, you can compare products on a bar chart, but what really counts is when you move into the real world and, you know, you didn't ask question about,, Sima, but you know, Sema, I think. Is on kind of the opposite side of that well controlled clinical trial. Looks, looks good in a clinical trial in the real world though, you have to stay on a drug, get to a high enough dose and be on it long enough for it to actually work. And I think that's a really, really great example. And I think as we look into the future profiles, really matter. And we've got a great profile, I like to call it a holy grail profile. Having been in the industry 35 years, you know, this is what the industry has always wanted to have a once a day pill that works, right? So maybe that's maybe that's the place just to give you some context on what we're hearing in the real world now., regarding off label use, but we've been crystal clear from day one, do not use Rezdiffra in F-4c patients until we have ,, the trial complete.

And we know that it works. And, you know, I think that is just the responsible thing to do. And also look. It makes sense what you don't want to do is have a product used in an area where there, you know, could be any kind of adverse event that then carries back to your already indicated population. So, you know, I think there is some use we can't quantify it. And there isn't a lot of data to suggest what the experience has been with people. So maybe, Dave, can I turn it over to you?

Yeah, just just a quick add. I mean,, you made a comment. About the open label experience. And so we didn't talk about it this time around, but we have in the past where, you know, the event rate in that 122 patient cohort over, over a two year period is quite low. It's a 2 to 3% annualized rate. So, you know, that's a, you know, even though it's an open label population, it's a well controlled and well characterized population with F-4c that looks very much like the maestro outcomes. Phase three population. So that low event rate is some of the basis for our confidence that Resmetirom, is could be effective in F-4 as well. I think with respect to timing, you know, as we said, when we when we have more precision on the estimate, we'll provide you with an update at this point, we're still projecting into 2027.

Okay. Thank. Our next question please.

Thank you very much. Our. Next question comes from the Line of Akash Tiwari of Jefferies. Your line is open.

Hey, this is John for Argus. I just want on the FOC outcomes trial. So given the main baseline platelet count in open label was around 125 K, somewhat higher than the baseline of 150 K in the efficacy trial. Do you view the event rates observed in the on as the realistic guide for what we should expect in the FOC and also other blinded event rates in the outcomes trial is tracking in line with what what we would expect from the oil data. Just just, a rough estimate on that point.

Okay. Do you want to.

Yeah, sure., yeah, I think with reference to the platelet count, I mean, you know, there's going to be some variability, as you know, in the measure of platelets. So,, you know, in general, we enriched both populations by having a very low exclusion criterion for platelet count. So,, you know, greater than 70,000 in the study and the distribution, as we've talked about of patients with CF is pretty similar. When you look at the open label population compared to the maestro outcomes, phase three study. So if you recall anticipate Nash scoring and you criteria are the combination of liver stiffness measurements by VCE and platelet count. So, you know, when you combine the two, you get a risk of csph ., so I think the fact that we were, we, we sort of pushed the population towards the c f, you know, higher CSF risk is, is one of the reasons why we're seeing events and maybe other, in other programs, you know, at other sponsor companies are maybe not seeing as robust,, accrual of events., we, we've, we think we've enriched this trial in a particularly effective way, both in terms of CSF and using other markers like MRE ., so., I think that's the, that's the key point.

Your second question was.

Whether the,, Yeah.

The pricing in line with the expectation. Yeah.

Yeah. So,, as we said, I mean, the, the events are tracking,, in a way that would ,, estimate a delivery of the data in 2027. And when we're able to provide more precision on that estimate, we'll give you an update. But right now, 2027.

Great.

Okay, thanks.

Next question please.

Thank you very much. Our next question comes from the line of Ash Verma of UBS. Your line is open. Ash.

Oh, great. Yeah. Thanks for taking my question., yeah, I got two on F4 also., so just maybe,, can you talk about like what type of relative risk reduction on the composite would position? That's different as a drug that can have broad adoption based on the feedback that you're getting from physicians? I use it 50%.. Outcome or can we get even a broader adoption with a lower risk reduction?, that's first. And then secondly, yeah, a lot of discussion on just the event rates here. Maybe just like if you can help us understand,, on the placebo events in this study,, like why would this be any different in this study versus the prior 5 to 10% annualized event rate that we've seen? And I believe your stat plans assumes an annualized 10%, but if it's more like a 5%, is it still 2027 readout? Thank you.

Dave.

Well, I mean, I think look, first of all, what's a clinically relevant reduction and hazard in F4?, the reality. Is I think anything that's statistically significant and yields an approval would be clinically relevant. I mean, this is this is a disease where there is no treatment in these patients are really on the cusp of end stage liver disease. And either death or a transplant. So,, I think, you know, I think one of the really important things is getting a medicine to these patients and, and any risk reduction is going to be, is going to be, a big change in the field for, for patients with respect to the placebo rate. I mean, we've, we've sort of guided to the 5 to 10% range based on, on the natural history, as you pointed out ., we there in the, in the earlier Harrison paper, which again was done., you. Know, sort of drafted using an earlier version of the protocol, the, the estimate of the placebo rate was about 10%. The, the, the 10% placebo rate, as you know .. Determines sort of the duration of the trial. It doesn't really affect trial powering. So,, you know, the hazard reduction is, is the key thing that determines trial powering.

And those two things together, the placebo rate and the drug effect determine the blinded event rate., so as we've said, the blinded event rate is tracking in line with delivery in 27. And we have more data. We'll provide you more precision on that estimate.

Thanks. Thanks, Ash. Next question please.

Thank you very much. Our next question comes from the line of Michael DiFiore of Evercore ISI. Michael, your line is open.

Thank you. Thanks so much for taking my question, guys. Two for me, the first, regarding Rezdiffra patient growth and underlying demand, can you separate? Two Q patient growth into new starts versus Reactivations following first quarter insurance disruptions? Versus Discontinuations? And my second question is, you know, you've already reached over 10,000 prescribers that have indicated that. And they've indicated that the commercial focus is increasingly shifting towards prescription depth. My question is, what percent of Uk-eu new prescriptions came from existing prescribers versus first time riders, and how is that? How is that mix changing? Thank you.

Hey, thanks, Mike, for the question. Maybe let me start a little with that. You mentioned the ten 000 prescribers. That is another really, really significant milestone to cross in the launch. I mean, my experience, you exceed 10,000 and you've really got your base prescribers that can drive your future into, in this case, a mega blockbuster., and that's something which hasn't been reported on that number in a while, but it continues to grow. We have new prescribers all the time.. You know, when you think about that mix, you're always going to have more of your scripts on a monthly basis coming from the existing,, pool. Of prescribers. So, you know, think about it, you know, if you add, you know, ten prescribers on the 10,000 disproportionately, there's so many. I'm not that's not the right number. Adding ten. We're adding more than that. I can assure you., so it's always going to be weighted towards the current prescribers. And that's why depth becomes much more important than breadth. Once you cross that ten 000 threshold. And we're continuing to see across all of the prescribers just increased depth of prescription. And why is that? Well, because they're having good results., why is that?

Because they're diagnosing more patients and they're learning the product. They're setting up their wiring, their system. They're setting up their pathways, they're making sure they have access to or have their own. And so that is what takes time. And a launch. And, you know, that's why, you know, products typically don't go from 0 to 100. It takes years to get to full penetration Because people just get more comfortable and work down through their deck of patients, if you will. And we're seeing exactly that. And we're tracking exactly like we had had hoped and like what we had thought we would. Now, so how does that translate? Now back to your question about ,, monthly,, monthly. Oh, you had said the mix. We haven't reported out on the mix of, you know, prescribers and so forth. If you think about Hepes and guys are the are the predominant riders, GIS outnumber Hepes just in the market in the country by about 10 to 1. So that's where the volume is going to be. Because they just have more patients and more prescribers. Okay. Now what about patient ads? You know that. Net number that we show we don't break it out into what's coming in the top of the funnel, what's going out the bottom of the funnel, and net.

And, as you can see that steadily adding, when you look back over the quarters, that's kind of our definition of steadily adding. And, you know, most importantly, we expect to continue to do so going forward. Now we're going to do everything we can to accelerate, adding to the top and decelerate, leaving from the bottom. That's, you know, that's what we do. That's,, that's what continues to make it a great launch. So,, that's what I'll leave it now. Mike, and we'll, you know, we'll update in the future, but,, you know, we are in really, really great shape on kind of all key metrics and, you know, really the one at the end of the day that counts as patients. And that's the one that I think that is,, you know, this 50. 000 milestone that is a big number. And, you know, just and that's why we kind of pulled that one ahead. We didn't want to wait another quarter and say, and we knew everyone would be doing well. What day of the month was it that it happened? Let me assure you, the 50,000 is consistent with the steadily adding patients It's just it's a big number that the world should know about.

Thanks.

Great. Thanks, Corey. Thank you. Next question.

Thank you very much. Our. Next question comes from the line of Jay Olson of Oppenheimer Jay. Your line is open.

Oh. Hey guys, congrats on all the progress and thank you for providing this update. Since you have a number of new patents and. Multiple levers available to drive DiFiore sales growth, including potential combinations. How are you thinking about the peak sales magnitude and timeline to achieve peak sales And what's your vision of how the mass market dynamics may evolve in the next ten years in terms of patient segmentation, and which genotypes or phenotypes do you suspect might be appropriate to target for a more personalized approach to treating Mash with precision medicine? Thank you. Yeah.

Okay. Thanks for the question. Let me start with kind of the market dynamics, because I think these are this is something which is really so remarkable about Mash. You know, I'll go back first of all, to when we communicated what the approachable patient number in F2, F3 was at the end of 23. That was the 315,000. And we did that same analysis at the end of 25. And that was 460,000. So almost 50% growth in patients Now you would say, well, gee, how sustainable is that? Well, here's why it's really sustainable because it's about 10% diagnosed today. The disease. And we have about 10% penetration. So we're. About 1% into the journey now. That is a setup where all the demographics, everything that we're looking at is driving towards Mash, continuing to be a challenge not just for the next three, five, ten years, but decades. So that's the backdrop that we're against. We've got we had almost 50% growth in two years. We expect double digit growth for the foreseeable future. And you heard me say that, you know, Q3. Is off to a strong start, but that we are expecting and seeing patient growth ,, in the market in 2026, consistent with what we've communicated before.

So that growth of the market is where the real opportunity lies. And as great as differ is, as I said, in my opinion, Holy Grail profile. We're looking for even more efficacy in either the whole population or segments of the population. And, you know, a real specific you said, how do you, you kind of the personalized medicine. This is where the Pnpla3 deal that we did with Arrowhead, we're so excited about. You know, that is a very specific, identifiable patient population that could benefit from having a not only a foundational. Therapy like Rezdiffra, where we work really well in that if you look at our presentation. But if you add to that this targeted siRNA, could we get even more efficacy? So we look at. There's going to be these segments that open up in time, partially driven by