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The final time I spoke about Ardelyx, Inc. (NASDAQ:ARDX) within the Looking for Alpha article entitled “Ardelyx: Underappreciated Biotech With Potential FDA Approval On Deck,” it was gearing as much as have its drug tenapanor as an add-on remedy for lowering serum phosphorous ranges in sufferers with power kidney illness [CKD] on dialysis. It was capable of obtain FDA approval of this drug after having a profitable resubmission of tenapanor with respect to 3 section 3 scientific research generally known as PHREEDOM, BLOCK, and AMPLIFY. This drug, for use to scale back serum phosphorous ranges for this affected person inhabitants, goes to be marketed as XPHOZAH. This newly authorised drug is off to a reasonably good begin, whereby U.S. internet product gross sales income for its first quarter of commercialization is anticipated to be round $2.5 million.
Apart from the power for this biotech to lastly obtain regulatory approval for the therapy of those CKD sufferers on dialysis, it was additionally capable of information greater with gross sales of its different regulatory authorised drug IBSRELA. Matter of reality, it was said that this drug will be capable of generate U.S. internet product gross sales of round $80 million for its first calendar 12 months available on the market, with gross sales anticipated to extend in 2024 much more. With such profitable development on these two fronts, I imagine that buyers can have nice long-term positive aspects, so long as administration continues to ship its promise of elevated gross sales product progress for each XPHOZAH and IBSRELA.
XPHOZAH Gross sales Might Be A Nice Addition To Further Income Era
As I discussed within the prior article, it did not look good for Ardelyx, particularly with the truth that the FDA had given it a complete response letter [CRL] for its drug tenapnor to scale back serum phosphorous ranges in sufferers with power kidney illness [CKD]. Nevertheless, I am comfortable to report that since then it has gone via a number of hoops to beat this setback by ultimately having the ability to refile its New Drug Utility [NDA] submission to the FDA. Not solely was it capable of resubmit its regulatory utility to the FDA of tenapanor, however it was capable of have it accepted as a class 2 review, which might solely require a 6-month evaluation interval.
Having stated that, the company set a PDUFA date of October seventeenth of 2023 to resolve upon whether or not or not this drug needs to be authorised for these sufferers. I am comfortable to report that the corporate was capable of ultimately obtain FDA approval of XPHOZAH [tenapanor] for the management of serum phosphorus ranges for sufferers with CKD. It wasn’t a straightforward course of, as a result of it needed to do quite a bit to ultimately obtain regulatory approval for this CKD drug. It needed to get an FDA appeal granted, together with an advisory committee which gave it a good end result in two eventualities. That’s, there was a vote from the advisory committee panel of 9 – 2 that the advantages of tenapanor outweigh the dangers, after which 10 -2 thereafter through which tenapanor, given along with phosphate binders, can also be a superb profit/danger situation.
Regardless of being early, this drug will not be off to a foul preliminary begin. It’s anticipated that U.S. internet product gross sales income for the first quarter of commercialization can be round $2.5 million. It stays to be seen how properly that this drug will in the end do available on the market, however there may be are two key elements to notice which could assist.
The primary could be with respect to its differentiation, in that XPHOZAH will not be a phosphate binder, however a phosphate absorption inhibitor [PAI]. Thus, it has a novel mechanism of motion, through which it’s a sodium/hydrogen exchanger 3 [NHE3] inhibitor. That’s, it blocks the first pathway of phosphate absorption, which is thru the paracellular pathway. Having stated that, this drug may be given as an add-on remedy for these CKD sufferers who both do not reply to phosphate binders or who’re illiberal to such remedy.
The second and ultimate benefit, plus why it’d do properly available on the market, could be that about 70% of sufferers are unable to keep up goal phosphorus ranges over a 6-month interval with present remedy [phosphate binders].
Financials
By way of financials, this firm is in good condition due to its money readily available. That is as a result of it has performed a number of money elevating actions in direction of the tip of 2023. It generated gross proceeds of about $58.4 million with respect to the sale of 13.8 million shares of its frequent inventory below its Gross sales Settlement with Jefferies LLC. From there, it additionally obtained about $30 million from Kyowa Kirin together with $5 million from Healthcare Royalty Companions and drew about $22.5 million from SLR Capital. The money place stays robust, as a result of based on the corporate’s up to date January 2024 presentation, it has $184 million in money as of December 31, 2023.
Earlier than a number of of those cash-raising actions, it said in its 10-Q SEC Filing that its money readily available of $165.1 million could be sufficient to fund its operations for at the very least 1-year from the date of its 10-Q SEC Submitting. Because it has been capable of enact such different cash-raising actions, it needs to be properly funded for an prolonged time period past the prior projection.
Lastly, the corporate can also be doing properly when it comes to gross sales of its irritable bowel syndrome drug with constipation [IBS-C] IBSRELA. It expects to achieve between $140 to $150 million in internet product gross sales of IBSRELA in 2024. Not solely that, however the inventory gained huge traction after it was introduced that Ardelyx expects peak U.S. internet product gross sales of $1 billion.
Dangers To Enterprise
There are dangers that buyers ought to concentrate on earlier than investing in Ardelyx. The first danger to contemplate could be with respect to ongoing gross sales of IBSRELA. Regardless that this biotech expects peak income of its drug for the therapy of sufferers with IBS-C to achieve $1 billion, there isn’t a assure that this expectation can be met.
The second danger to contemplate could be with respect to the launch of the newly authorised drug XPHOZAH for the therapy of hyperphosphatemia which happens in sufferers with CKD. Regardless that preliminary gross sales are robust in the interim, there isn’t a assurance that such a pattern will proceed within the coming months. I imagine that it’s going to nonetheless do properly, although, due to what I highlighted above, which is that XPHOZAH will not be essentially competing towards phosphate binders. As an alternative, it’s being given alongside phosphate binders to additional improve the power for sufferers to achieve sufficient phosphorous ranges.
Conclusion
Ardelyx has been capable of climb itself out of the depths that it was in when the FDA gave its drug tenapanor a Full Response Letter [CRL] for the therapy of hyperphosphatemia related to CKD. Nevertheless, since then not solely has it been capable of obtain U.S. advertising and marketing approval of this drug, however it has been capable of generate an preliminary curiosity in sufferers taking it. It stays to be seen how properly this drug does within the long-term, however at the very least it has now been capable of get hold of regulatory approval for one more indication as a part of its pipeline.
My opinion is that the upper steerage given by Ardelyx, Inc. administration, in that peak U.S. gross sales of IBSRELA are anticipated to achieve $1 billion, reinforces my outlook that there’s a good probability that Ardelyx may in the end be acquired. The flexibility for IBSRELA to generate such gross sales could be sufficient, however now you could have one other drug approval that simply occurred. With FDA approval of XPHOZAH for therapy of hyperphosphatemia for CKD sufferers given, plus a rise in peak gross sales expectation of IBSRELA for IBS-C, I imagine that buyers can profit with any potential positive aspects made.