Akebia Therapeutics, Inc. (AKBA)·Q1 2025 Earnings Summary

Executive Summary

• Q1 2025 was Akebia’s first full quarter with Vafseo U.S. sales: total revenues $57.3M, net product revenue $55.8M, and diluted EPS $0.03; net income of $6.1M versus a loss of $18.0M in Q1 2024 .
• Results materially beat Wall Street consensus: revenue $57.3M vs $44.5M consensus (+$12.8M), EPS $0.03 vs -$0.045 consensus (+$0.075); Vafseo net revenue $12.0M exceeded company’s prior $10–$11M guidance range; Auryxia delivered $43.8M .
• Strong commercial launch metrics: >640 prescribers, ~12 prescriptions per prescriber by March, ~1/3 prescriptions were refills, and orders placed by the top five dialysis organizations; inventory at ~4 weeks with at least 12 months of Vafseo U.S. inventory on hand free of potential incremental tariff payments .
• Near-term catalysts: LDO protocol activation pilot expected to start in Q3 with broader rollout in Q4, potential continued Auryxia revenue resilience prior to first ANDA approval, and VALOR Phase 3 NDD trial initiation in 2H 2025 .

What Went Well and What Went Wrong

• What Went Well

  • Vafseo launch outperformed: $12.0M in Q1 net revenue, beating $10–$11M guidance; >640 prescribers with ~12 prescriptions per prescriber by quarter-end and refills at ~1/3 of total prescriptions .
  • Profitability inflection: net income of $6.1M driven by higher product revenues and lower COGS after Auryxia intangible amortization ended; cash increased to $113.4M following a $50M offering .
  • Strategic access and reimbursement: contracts covering nearly 100% of dialysis lives; orders from top five LDOs; ~80/20 split fee-for-service vs other plans and encouraging Medicare Advantage coverage early in launch .

• What Went Wrong

  • Large Dialysis Organization timing: broad LDO protocol activation still pending; one LDO plans an operational pilot in Q3 with broader rollout in Q4, pushing step-function growth to 2H 2025 .
  • Auryxia generic overhang: authorized generic entered post-March 20; while first ANDA not yet approved, future Auryxia sales are difficult to predict due to potential additional generic competition .
  • Launch operational complexity: early-quarter specialty pharmacy capacity constraints created multi-week backlogs across TDAPA products, though they subsided by late Q1 .

Financial Results

Guidance Changes

Earnings Call Themes & Trends

Management Commentary

• “We delivered U.S. net product revenues of $12 million versus our guidance of $10–$11 million in the first quarter… it is one of the strongest launches I’ve ever seen in the dialysis market.” — John Butler, CEO .
• “Prescriptions per provider have grown to approximately 12 at the end of March from nearly 8 at the end of February… about 1/3 of all prescriptions written in quarter 1 were refills.” — Nicholas Grund, CCO .
• “We have at least 12 months of Vafseo inventory on hand in the U.S. and do not expect any meaningful tariff-related impact… We believe we are financed to achieve profitability based on our current operating plan.” — Erik Ostrowski, CFO/Chief Business Officer .

Q&A Highlights

• LDO rollout timing: One LDO plans a large operational pilot (50–200 sites) in Q3, then broader rollout in Q4; second LDO allowing exceptions but is earlier in process. This is expected to “double the number of patients with access” when protocol is broadly activated .
• Pricing/net revenue dynamics: Net price per patient expected to decrease with volume due to rebate structures; near-term “lumpiness” as mid-sized providers come on; dose titration likely lifts gross price per patient vs initial 300mg starting dose .
• Auryxia generics: Authorized generic minimal in Q1 and expected small in Q2; revenue resilience possible until first ANDA approval; company can match prices under contracts since binders entered the bundle .
• Reimbursement: Early Medicare Advantage coverage encouraging (~80/20 FFS vs other plans); larger providers expected to improve MA negotiations as pilots begin .

Estimates Context

Values retrieved from S&P Global.*

Implications: Across-the-board beats signal strong early adoption and monetization of Vafseo; consensus models likely need to raise near-term revenue/EPS assumptions and incorporate step-function growth risk/optionality tied to LDO protocol activation in 2H 2025 .

Key Takeaways for Investors

• Vafseo’s early U.S. launch is tracking ahead of expectations (revenue/EPS beats, top-end guidance exceeded), with improving breadth/depth and refills indicating persistence and dose titration tailwinds .
• Near-term revenue trajectory should remain supported by mid-sized providers; a large LDO pilot in Q3 with broader Q4 rollout is the next major catalyst to expand access materially .
• Auryxia revenue held up in Q1 despite authorized generic entry; while the first ANDA timing is uncertain, contractual price-matching and bundle dynamics can mitigate near-term erosion .
• Margin profile improved sharply as Auryxia amortization ended and Vafseo pre-launch inventory reduced COGS; operating leverage evident with operating margin at 23.6% in Q1 .
• Cash of $113.4M, expanded institutional sponsorship via $50M offering, and management’s assertion of financing to profitability reduce balance sheet risk as pipeline and label expansion progress .
• Watch payer mix evolution: early MA coverage is better than planned; large providers should enhance MA negotiations post-pilot, supporting broader reimbursement .
• Medium-term thesis: Vafseo label expansion to NDD (VALOR 2H 2025 start) represents significant upside given favorable pricing/mix vs dialysis and large patient population; monitoring FDA interactions/statistical plan is key .