Travere Therapeutics - Earnings Call - Q3 2025

Executive Summary

• Travere delivered a standout quarter: total revenue $164.9M (+162% Y/Y) on FILSPARI U.S. sales of $90.9M (+155% Y/Y) and $51.7M licensing revenue; non-GAAP EPS $0.59 vs S&P Global consensus -$0.09, a major beat driven by continued FILSPARI momentum and a $40M EU market-access milestone.
• Operating leverage inflected: GAAP operating income $24.9M and net income $25.7M (GAAP EPS $0.29); non-GAAP net income $52.8M (EPS $0.59), reflecting strong gross-to-net execution and disciplined opex despite launch prep for FSGS.
• Structural tailwinds strengthened: FDA streamlined REMS (quarterly LFTs, removed embryo-fetal monitoring), and 2025 KDIGO guidelines position FILSPARI as foundational first-line therapy in IgAN, supporting earlier use and broader adoption.
• 2026 catalysts: FDA canceled planned AdCom; FSGS sNDA has a January 13, 2026 PDUFA. Management is preparing for a rapid launch upon approval; new DUPLEX/RaDaR data at ASN reinforce proteinuria thresholds linked to 5-year kidney failure risk reduction, supporting the FSGS case.

What Went Well and What Went Wrong

What Went Well

• Commercial momentum: FILSPARI U.S. sales $90.9M (+155% Y/Y); 731 PSFs despite summer seasonality, with the strongest daily PSF rate in September continuing into October.
• Quality of beat: Non-GAAP EPS $0.59 vs S&P Global consensus -$0.09*; revenue $164.9M vs $106.1M* consensus, supported by a $40M market-access milestone and improved pull-through, compliance, and persistence.
• Strategic tailwinds: FDA REMS simplification and KDIGO guidelines elevate FILSPARI as foundational, enabling earlier treatment and easier monitoring; management calls it a “paradigm shift” among nephrologists.

What Went Wrong

• PSFs dipped sequentially (745 in Q2 → 731 in Q3), attributed to seasonality; management flagged higher gross-to-net in Q4 (~20% FY) which could temper near-term flow-through.
• SG&A rose to $86.5M (vs $65.6M Y/Y) as the company invests ahead of potential FSGS launch; further increases expected into Q4 and launch.
• Cash declined to $254.5M at 9/30 (excludes $40M milestone received in Oct) due to retiring the remaining ~$69M 2025 converts; reduces flexibility near-term until milestone receipts are recognized in cash.

Transcript

Operator (participant)

Good afternoon and welcome to the Travere Therapeutics third quarter 2025 financial results conference call. Today's call is being recorded. At this time, I would like to turn the conference call over to Nivi Nehra, Vice President, Corporate Communications and Investor Relations. Please go ahead, Nivi.

Nivi Nehra (VP of Corporate Communications and Investor Relations)

Thank you, Operator. Good afternoon and welcome to Travere Therapeutics' third quarter 2025 financial results and corporate update call. Thank you all for joining. Today's call will be led by Dr. Eric Dube, our President and Chief Executive Officer. Eric will be joined in the prepared remarks by Dr. Jula Inrig, our Chief Medical Officer, Peter Heerma, our Chief Commercial Officer, and Chris Cline, our Chief Financial Officer. Dr. Bill Rote, our Chief Research Officer, will join us for the Q&A. Before we begin, I'd like to remind everyone that statements made during this call regarding matters that are not historical facts are forward-looking statements within the Safe Harbor provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements are not guarantees of performance.

They involve known and unknown risks, uncertainties, and assumptions that may cause actual results, performance, and achievements to differ materially from those expressed or implied by the statement. Please see the forward-looking statement disclaimer on the company's press release issued earlier today, as well as the risk factor section in our Forms 10-Q and 10-K filed with the SEC. In addition, any forward-looking statements represent our views only as of the date such statements are made, October 30th, 2025. Travere specifically disclaims any obligation to update such statements to reflect future information, events, or circumstances. With that, let me now turn the call over to Eric.

Eric Dube (President and CEO)

Thank you, Nivi, and good afternoon, everyone. The third quarter marked exceptional progress across our three key priorities: delivering strong commercial execution in IgA nephropathy, preparing for a potential FDA approval in FSGS, and successfully advancing the manufacturing scale-up of pegtibatinase to support restarting enrollment in the pivotal HARMONY study in 2026. The core driver of our performance is FILSPARI's continued growth in IgA nephropathy, where we delivered sustained commercial excellence in the third quarter. Physicians continue to confidently adopt FILSPARI as a foundational nephroprotective therapy for their patients. This confidence reflects consistent real-world outcomes, robust long-term data reinforcing FILSPARI's differentiated profile, and its recent inclusion in the KDIGO guidelines for earlier first-line use to optimize nephroprotection in IgA.

Additionally, in August, the FDA approved a modification to the FILSPARI REMS program, removing the embryo-fetal toxicity REMS and reducing the liver monitoring frequency to quarterly, which aligns with routine clinical practice and our clinical trial experience. This change not only simplifies care for physicians and patients but also reinforces FILSPARI's long-term safety profile. Our U.S. performance continues to be complemented by strong progress from our partners globally. In Europe and the U.K., CSL Vifor is expanding access following full regulatory approvals, and the progress has culminated in the recent achievement of a meaningful market access milestone. In Japan, Renalys completed enrollment in its registrational trial in IgA and remains on track to deliver topline data in quarter four.

The company also reached an agreement with the PMDA of Japan to initiate two phase III trials for sparsentan in FSGS and Alport syndrome and recently announced its planned acquisition by Chugai, a leading innovator in renal and rare disease research in Japan. Together, these milestones underscore FILSPARI's expanding global footprint and the growing excitement around its long-term potential to transform care for rare kidney diseases. Beyond our progress in IgA, addressing the urgent need for an approved medication in FSGS is both central to our mission and represents the next pillar of growth for Travere. Today, there are no FDA-approved medicines for this disease. Patients often experience rapid disease progression, with many reaching kidney failure within just a few years of diagnosis, often requiring a transplant. Even then, the disease recurs in approximately half of transplant recipients. The consequences are devastating for patients and their families.

Earlier and more effective treatment is desperately needed, which is why the opportunity to bring FILSPARI forward in FSGS is so meaningful for this community who have waited far too long. In September, the FDA communicated that an advisory committee is no longer needed for our sNDA in FSGS. We have been pleased with the progress of our review and our ongoing engagement with the agency to date. Pending approval, FILSPARI will become the first and only approved medication for FSGS, representing a landmark moment for this community and, given the urgent need for an effective approved medication, a transformational opportunity for Travere. Our teams are fully prepared to execute a rapid launch upon approval, building upon the commercial foundation we've established in IgA nephropathy.

Beyond FILSPARI, we have successfully manufactured the first commercial-scale batches of pegtibatinase and are looking forward to an expected restart of the pivotal HARMONY study of pegtibatinase in classical HCU next year. Pegti remains a promising, potentially disease-modifying investigational therapy that could address a substantial gap for patients living with this rare metabolic disorder. I'll now turn the call over to Jula for a clinical update. Jula?

Jula Inrig (CMO)

Thank you, Eric. One of the most significant milestones this quarter was the inclusion of dual endothelin angiotensin receptor antagonism in the updated KDIGO guidelines for IgA nephropathy, a strong external validation of FILSPARI's role as foundational treatment. KDIGO includes FILSPARI as a first-line option for patients who are at risk of IgA nephropathy progression, recognizing it as the only therapy with proven efficacy versus optimized RAS inhibition. The guidelines also recommend simultaneous treatment of the two drivers of IgA nephropathy progression, targeting both the upstream immune activation that causes pathogenic IgA deposition and the downstream glomerular injury that leads to nephron loss. This holistic framing of disease management aligns with FILSPARI's mechanism of action as the only fully approved non-immunosuppressive nephroprotective treatment, which can be combined with immune-targeted medications to optimize long-term outcomes for patients living with IgA nephropathy.

Across our KOL engagements following the publication of the guidelines, nephrologists have described the new KDIGO framework as a true paradigm shift that validates early and comprehensive intervention. We believe this recognition cements FILSPARI's position as foundational care in IgA nephropathy, guiding a new era of evidence-based treatment sequencing. A further testament to our leadership in rare kidney disease is our focus on data generation and dissemination, as exemplified by numerous scientific presentations and engagements at recent congresses, including our 11 upcoming presentations at ASN Kidney Week. A few highlights of this data include the phase II SPARTAN trial in RAS inhibitor-naive patients with IgA nephropathy, demonstrating that irrespective of baseline proteinuria levels, FILSPARI consistently reduced proteinuria and led to significant reductions in urinary biomarkers of disease activity, including reductions in immune system and complement activation markers indicating potential disease-modifying qualities of FILSPARI.

We also have two new presentations from the phase III PROTECT trial in IgA nephropathy: one evaluating efficacy across historical histopathology from kidney biopsies, and another assessing outcomes based on time from IgA nephropathy diagnosis. Both presentations reinforce the SPARTAN findings and align with the KDIGO recommendations, showing that earlier treatment of patients with FILSPARI can lead to greater nephroprotection. We also continue to generate and present real-world and long-term data across a broad spectrum of IgA nephropathy disease severity, demonstrating FILSPARI's consistent benefit in reducing proteinuria and preserving kidney function. In FSGS, as Eric highlighted in his opening remarks, we are pleased with the progress of our review. The agency remains engaged on our submission, and from our perspective, the process continues to be similar to our experience during the IgAN NDA review.

Ahead of a potential approval in January 2026, our Medical Affairs teams are deeply engaged, expanding disease education, strengthening nephrologist awareness around the importance of proteinuria in FSGS disease progression, and responding to queries regarding how the DUPLEX data could translate into real-world benefit for this underserved patient population. At ASN, we are presenting several new analyses from the DUPLEX study, including a late-breaking analysis that demonstrates that patients treated with FILSPARI achieved proteinuria levels of less than 0.7 g/g more frequently versus maximum labeled dose irbesartan, and patients who achieved this threshold had a lower risk of kidney failure irrespective of treatment arm. This analysis demonstrates further alignment and supports the conclusions of the PARASOL working group that lower levels of proteinuria translate into meaningful improvements in kidney outcomes.

We also have data that extrapolates the antiproteinuric treatment effect of FILSPARI versus irbesartan seen in the 2-year DUPLEX trial into longer-term kidney failure outcomes from the U.K. Rare Disease Renal Registry, or RaDaR. We also have subgroup analyses of pediatric patients and patients with collagen IV genetic mutations, demonstrating a consistent antiproteinuric treatment effect with FILSPARI versus irbesartan in these two high-risk, difficult-to-treat patient populations. With no approved medicine for patients with FSGS today, the opportunity to bring FILSPARI forward is both urgent and transformative. The supportive data from DUPLEX and our regulatory momentum give us confidence in the path ahead. With our goal to provide FILSPARI as a foundational treatment for patients with IgA nephropathy and ultimately those with FSGS, we are pleased that the FDA-approved modifications to our REMS program, removing the embryo-fetal REMS and reducing the frequency of liver monitoring to quarterly.

The feedback we've heard from nephrologists is that these changes are welcomed, the monitoring frequency aligns with how they care for their patients in clinical practice, and these changes can help increase access for the subset of patients for whom monthly testing was an impediment. Turning to our pegtibatinase development program for the treatment of HCU, we recently presented long-term data at the ICIEM Congress from cohort 6 in our phase I/II COMPOSE open-label extension. At the 2.5 mg/kg twice-weekly target dose, patients treated with pegtibatinase achieved sustained and clinically meaningful reductions in total homocysteine and methionine over an additional year of follow-up, remarkable results in the context of an open-label study. Importantly, we have successfully manufactured the first commercial-scale batches of pegtibatinase and have generated data to support FDA interactions.

This progress positions us for an expected restart of enrollment in the pivotal phase III HARMONY study next year, reinforcing our commitment to advancing the only investigational therapy with disease-modifying potential for patients with classical HCU. I will now turn the call over to Peter for a commercial update. Peter.

Peter Heerma (CCO)

Thank you, Jula. I am very pleased to share that the third quarter marked another period of strong commercial performance and continued momentum for FILSPARI in IgA nephropathy, reinforcing its position as a foundational therapy. FILSPARI net sales reached approximately $91 million in the third quarter, representing another quarter of strong growth driven by consistent demand and deepening engagement among new and experienced prescribers. Demand for FILSPARI remains robust, with 731 new patient start forms received during the quarter, despite experiencing summer seasonality, as is typical in the summer months. In fact, in September, we recorded our highest daily patient start form rate since launch, and we are seeing that trend continue into October. Throughout the quarter, we saw durable utilization among existing nephrologists and a continuation of new prescribers.

Importantly, we are seeing a steady increase in the number of practices treating multiple patients with FILSPARI, which highlights growing confidence in the therapy's profile and real-world performance. As the IgA nephropathy treatment landscapes evolve, we continue to hear consistent feedback from the nephrology community, reinforcing that physicians view FILSPARI as the preferred novel therapy. Not only because of its proteinuria efficacy, but because it delivers a meaningful long-term improvement in kidney outcomes while allowing patients to maintain a normal lifestyle through a once-daily oral regimen. We are encouraged by the response of the nephrology community to the modification of our REMS program. This simplification makes FILSPARI treatment even more convenient, particularly for newly diagnosed or lower-risk patients as quarterly monitoring is consistent to nephrology's clinical practice.

We are pleased to see continued uptake of FILSPARI among patients with lower proteinuria levels, reflecting growing recognition that patients above 0.5 g/g remain at risk of progression, in alignment with our broader label and the KDIGO guidelines. Patient satisfaction is strong, as evidenced by consistently high compliance and persistence. As we continue to expand FILSPARI's reach, our patient services and fulfillment programs remain an important contributor. We have maintained broad payer coverage with easing of prior authorization requirements to reflect FILSPARI's broader label, long-term evidence, and positioning in the guidelines. Turning to FSGS. If approved, FILSPARI will become the first approved medicine for FSGS, a leading cause of kidney failure.

Given the high degree of overlap between the FSGS and the IgA nephropathy prescriber base, we will be able to build upon strong brand awareness and familiarity of FILSPARI with many physicians that have already had experience with the product. Given the high unmet needs for an approved medication and the progressive nature of FSGS, we believe this could be an even bigger opportunity with a more rapid uptake versus our launch in IgA nephropathy. We know the FSGS community is eagerly awaiting an effective medicine, and we will be ready to launch in January if approved. In summary, the third quarter represents another quarter of exquisite execution and continued growth for FILSPARI in IgA nephropathy. The combination of clinical product differentiation, early intervention, strong prescriber confidence, and a consistent patient experience continues to drive momentum and position FILSPARI as a foundational and nephroprotective choice among IgA nephropathy therapies.

With our strong commercial foundation and expanding real-world experience, we remain confident in FILSPARI's ability to deliver sustainable growth and long-term leadership in rare kidney disease care. I am sincerely proud of the continued performance of our commercial teams and the dedication they bring every day to support patients and physicians. Their success in establishing FILSPARI in IgA nephropathy gives us great confidence in our ability to execute effectively in FSGS, and we will be ready if approved. Let me now turn the call over to Chris for the financial update. Chris.

Chris Cline (CFO)

Thank you, Peter, and good afternoon. This quarter, we delivered another strong set of financial results with continued significant revenue growth and disciplined financial investments. As Peter mentioned, our top line expansion reflects the strength of our underlying FILSPARI business and the consistent execution across our key commercial initiatives, momentum that we believe sets us up for durable growth ahead. We also further strengthened our financial foundation by repaying our remaining 2025 convertible notes, and significant value was generated from our partnerships, including the recently achieved $40 million market access milestone from CSL Vifor and the announced acquisition of Renalys by Chugai, both great examples of how our collaborations continue to create value and validate the potential of FILSPARI globally. Starting with revenue, in the third quarter, we generated U.S. net product sales of $113.2 million. FILSPARI continued to grow significantly in the third quarter, generating $90.9 million in U.S.

net product sales, which represents an increase of more than 155% year-over-year. From a gross-to-net perspective, FILSPARI had a one-time benefit of less than $2 million during the quarter, and we continue to anticipate higher discounts in the fourth quarter. Elsewhere, THIOLA and THIOLA EC contributed $22.3 million in U.S. net product sales, and we also recognized $51.7 million of licensing collaboration revenue, which results in total revenue of $164.9 million for the quarter. Included in the licensing collaboration revenue line this quarter is a $40 million market access milestone that was achieved by CSL Vifor. We recently received payment, which will be reflected in our cash balance in the fourth quarter. Also included in the licensing collaboration this quarter is $9.3 million in non-cash revenue that resulted from the relinquishment of our option to acquire Renalys in anticipation of their agreement to be acquired by Chugai.

Moving to operating expenses, our research and development expenses for the third quarter of 2025 were $51.9 million compared to $51.7 million for the same period in 2024. On a non-GAAP-adjusted basis, R&D expenses were $47.8 million compared to $48.4 million for the same period in 2024. Selling, general and administrative expenses for the third quarter were $86.5 million compared to $65.6 million for the same period in 2024. On a non-GAAP-adjusted basis, SG&A expenses were $63.5 million for the third quarter compared to $49.7 million for the same period in 2024. The increase in SG&A is primarily attributable to investments and preparations for a potential launch in FSGS in January, increased amortization expense related to FILSPARI royalties, as well as an increased investment in supporting commercial efforts for FILSPARI in IgA nephropathy following full approval.

Total other income net for the third quarter of 2025 was less than $1 million compared to $1.3 million for the same period in 2024. Net income for the third quarter of 2025 was $25.7 million, or $0.29 per basic share, compared to a net loss of $54.8 million, or $0.70 per basic share for the same period in 2024. On a non-GAAP-adjusted basis, net income for the third quarter of 2025 was $52.8 million, or $0.59 per basic share, compared to a net loss of $35.6 million, or $0.46 per basic share for the same period in 2024. As of September 30th, 2025, we had cash, cash equivalents, and marketable securities totaling approximately $254.5 million.

This balance reflects our repayment of the remaining $69 million in 2025 convertible notes, and as I highlighted earlier, it does not yet reflect the proceeds of the $40 million milestone payment from CSL Vifor, and it also does not yet include any proceeds from the recently announced acquisition of Renalys by Chugai. As we move forward, we are well-positioned to sustain our momentum in IgA nephropathy, execute a successful launch in FSGS if approved, and advance the reinitiation of enrollment in our pegtibatinase phase III study next year. Importantly, we're doing all of this from a position of financial strength with no near-term need for additional capital to execute on our core objectives. This foundation gives us confidence in our ability to execute on our key priorities and continue advancing our mission for patients. I'll now turn it over to Eric for his closing comments. Eric.

Eric Dube (President and CEO)

Thank you, Chris. In Q3, we made tremendous strides across all of our programs, and I am proud of how every employee shows up with passion and focus to advance our mission. One great example is our pegtibatinase team, who has diligently solved scale-up challenges so that we are positioned to restart the HARMONY trial next year. October is HCU Awareness Month, and it is a fitting reminder of how much work is still needed to allow families affected by HCU to live with a little less worry and a bit more hope. We've entered the final months of 2025 confident in our ability to sustain FILSPARI's growth in IgA nephropathy, to successfully execute on a potential approval and launch in FSGS, and to advance our pipeline with focus.

We have the right people, a strong financial foundation, and the momentum to bring incredible innovation to the rare disease communities that have been waiting far too long. I'll now turn the call over to Nivi for Q&A. Nivi?

Nivi Nehra (VP of Corporate Communications and Investor Relations)

Thank you, Eric. Operator, we can now open up the line for Q&A.

Operator (participant)

Thank you. Ladies and gentlemen, we will now begin the question-and-answer session. To ask a question, you may press star then one on your touch-tone phone. If you are using a speakerphone, please pick up your handset before pressing the keys. To enter your question, please press the pound key. As a reminder, we ask that you limit yourself to one question. If you have another question, please rejoin the queue. We will now take the first question from the line of Joe Schwartz from Leerink Partners. The line is open.

Joe Schwartz (Senior Managing Director and Senior Research Analyst)

Great. Thanks, and congrats on another strong quarter of execution. With the new label approved in August, can you quantify either qualitatively or quantitatively the early impact of the REMS adjustment? Are you seeing new prescribers or a new patient base that might have been more reluctant previously? It seems like with such a strong beat this quarter, you might not be seeing any competition. Competitive impacts, or are you seeing any at all? It was just offset by the updated label. Any color you could provide would be great. Thanks.

Eric Dube (President and CEO)

Thanks, Joe. Peter, why don't you take that question?

Peter Heerma (CCO)

Yeah, thanks, Joe. It's a good question. I think you're asking two questions. One is, what is the impact of the REMS modification so far, and two, are you seeing any impact of competitive dynamics? I think overall, I would say we see very consistent demand since we had our full approval last year, and that consistency has not been impacted by launches of new products that came into the marketplace. I think very robust continuation of growth. To your first question with regards to the REMS modification, I think that is certainly a tailwind that we are having and that has been very positively received by the nephrology community. What we are seeing is that we have a continuation of new prescribers while we also continue to expand within experienced prescribers.

I think especially the REMS modification from a monthly base to a quarterly base in the first year really helps for those patients that are not as sick as the higher proteinuria levels, but still are at significant risk of progression of disease. Those patients may not see their physician on a monthly base or may not do traditional testing on a monthly base, but certainly do that at a quarterly base. I think the timing of the REMS modification fits very nicely in the expansion of the patient population that we are seeing.

Joe Schwartz (Senior Managing Director and Senior Research Analyst)

Very helpful. Any insight into any competitive pressures at all, or have you not detected any?

Peter Heerma (CCO)

Yeah, as I mentioned, we have seen very consistent demand. I would say Q3, we saw less of an impact of seasonality than we saw last year, and that in a more competitive landscape. I would say that gives you a color of our execution and performance in Q3.

Eric Dube (President and CEO)

Yeah, that's great, Peter. The only thing that I would offer in addition, Joe, is that not only did we see the modification of the FILSPARI REMS program, as you alluded to, which makes it just that much easier for physicians and patients, we also saw the publication of the KDIGO guidelines that further reinforced the positioning of FILSPARI. I think both of those in combination, of course, with the phenomenal execution of Peter's team, continue to reinforce our strong position within this market.

Joe Schwartz (Senior Managing Director and Senior Research Analyst)

Thank you.

Eric Dube (President and CEO)

Thank you.

Operator (participant)

Laura Chico from Wedbush, your line is open.

Laura Chico (Managing Director)

Good afternoon. Thanks very much for taking the question. Just two quick ones for me. First, with respect to FILSPARI at this point, do you have a sense as to what the typical baseline proteinuria level is at start of prescribing? I think Peter made a comment about perhaps some patients coming in now with a lower level. Second, are you detecting any off-label use in the FSGS setting at this point? Thank you very much.

Eric Dube (President and CEO)

Thanks, Laura, for those questions. I'll take the second one regarding FSGS. We do see some limited prescribing and use in FSGS. We, of course, do nothing to promote that, but we are seeing some physicians make that choice. I will turn it over to Peter to answer your question about baseline UPC.

Peter Heerma (CCO)

Yeah, thanks, Laura. What we have seen since we had the full approval last year in September is that we have seen consistently the baseline proteinuria levels are well below 1.5 g/g. It's what you would expect. The larger patient population, about 65% of the patient population, has proteinuria levels below 1.5 g/g, and we're making good inroads in penetrating that market segment. What you would expect is that you will see a continuation of lower proteinuria levels at initiation.

Laura Chico (Managing Director)

Thanks very much.

Eric Dube (President and CEO)

Thank you.

Operator (participant)

Anupam Raman from JPMorgan, your line is open.

Anupam Raman (Managing Director)

Hey, guys. Thanks so much for taking the question and congrats on the quarter. Just in the context of the beat that you guys had here with FILSPARI, how do we think about the quarter-over-quarter declines in patient start forms? I know you mentioned some summer seasonality, but there were those tailwinds from guidelines and REMS. What are the considerations there? Anything to note on gross and net or inventory?

Eric Dube (President and CEO)

Yeah, maybe I can frame this and then have Peter and Chris offer anything further. I think the strong performance in demand in Q3 really reflects that underlying expectation. I'll have Peter talk about some of the trends within the quarter that we saw. It really is about the seasonality. While we didn't see as much impact this year as we did last year, we certainly did see some of that in terms of the slower months. Peter, maybe you can allude to that, and Chris, you can talk about the gross-to-net impact in Q3.

Peter Heerma (CCO)

Yeah, happy to comment on that, Anupam. Thanks for that question. I'm actually really pleased with the performance and the demand we saw in Q3. In particular, what I outlined during the call, September, we had the strongest daily patient start form generation, and that trend is continuing in October. I think very strong demand. As I mentioned earlier, we have seen less of an impact of seasonality in a more competitive environment. I think the performance is really strong. Yeah, I couldn't be more proud of the team to continue to execute in the way they do.

Chris Cline (CFO)

Anupam, on the gross-to-net factor for this quarter, we did highlight that there was less than $2 million benefit. That's just working through the first year here in Part D and having the true-ups as we go throughout the year. Looking ahead, we've guided throughout the year that the back half may have higher gross-to-net. That remains the same for the fourth quarter, but we're still right around that guidance of around 20% for the year. The fundamentals, as Eric and Peter highlighted, are very strong. We're looking forward to the end of the year here. Thanks, Anupam.

Operator (participant)

Tyler Van Buren from TD Cowen, your line is open.

Hi, this is Francis on for Tyler. What can we expect in terms of communication leading up to the FSGS PDUFA date in January? Is it possible that you'll disclose if and when you're in labeling discussions?

Eric Dube (President and CEO)

Francis, thanks for the question. It's been our practice not to comment on ongoing FDA interactions. Like we did during our IgA review, we'll be entering a quiet period as we approach the PDUFA date. You wouldn't expect any updates from us during that time, but we will provide and look forward to providing updates on January 13th.

Operator (participant)

Yigal Nochomovitz from Citigroup, your line is open.

Yigal Nochomovitz (Director of Biotech Equity Research)

Hi, guys. Thank you very much for taking the question. I wanted to ask about REMS and KDIGO. I'm just curious, when you're in the field now, with the new message around the reduced REMS and the better KDIGO guidelines, how many of the practitioners are sort of aware of these changes or were informed outside of the channels through Travere, or is it really that the information is coming from Travere in terms of learning about the better REMS and the KDIGO? Just how is that information flowing? It'd be interesting to understand a little better. Thank you.

Eric Dube (President and CEO)

Yeah, Peter, do you want to take that? Jula, if you have anything further from your engagement with KOLs.

Peter Heerma (CCO)

Happy to take that one. I mean, it was a year ago that KDIGO disclosed their draft guidelines. I think the key opinion leaders and the thought leaders, they were well familiar with the KDIGO guidelines. What we are seeing now is the full publication that really trickles down to the community nephrologists as well. That publication really helps there, and our team is certainly, it fits nicely in our educational efforts with physicians. With regard to the REMS modification, that is really up to us to communicate to physicians. Like I said in the prepared remarks, I'm really pleased with the reaction and the response we got from physicians of that modification in the first year and how this fits very nicely with their clinical practice, not having to have that monthly monitoring, but doing it at a quarterly base from the get-go.

Like I said, I mean, this is something that they are doing on a quarterly base anyway, so there is no additional burden for the physician, neither for the patient.

Yigal Nochomovitz (Director of Biotech Equity Research)

Okay. On pegtibatinase, just very quickly, is the scale-up basically a completed project now, or is there any more work to do to make sure you have enough supply for the whole HCU market?

Eric Dube (President and CEO)

Thanks, Yigal. Bill, why don't you take that one?

Bill Rote (Chief Research Officer)

Certainly. We're very pleased to have completed our first commercial batches. This enables us to engage with the FDA as was planned, which enables the restart of the study in the next year. We will continue additional manufacturing campaigns in parallel with the study running to do the further characterization work that's required for the BLA and to build stock for launch. The key milestone is getting to this scale of manufacture so that we can restart enrollment in the phase III study.

Operator (participant)

Gavin Clark-Gartner from Evercore, your line is open.

Gavin Clark-Gartner (Managing Director of Biotech Equity Research)

Hey, guys. Thanks for taking the question. I'm sorry to go back to kind of the net price discussion, but even if I take a couple million out there for the one-time net price boost, I think the revenue is still a bit higher than some investors were anticipating based on the PSF trajectory. I'm just curious, is this volume of PSF trajectory that you got this quarter and last quarter, which is fairly consistent, is the revenue growth you're seeing based on that something we should be extrapolating going forward? How much is the Q4 gross-to-net impact? Thanks so much.

Eric Dube (President and CEO)

Thanks, Kevin. Chris, why don't you take that?

Chris Cline (CFO)

Sure. I think one of the things that Peter has mentioned along the way is that we've continued to refine our pull-through process, and we've really made good progress there. I think that's part of what's driving the revenue growth that has been able to outpace the PSF growth over time. We've also seen very strong compliance and persistence. I think, again, that's another testament to the overall profile for FILSPARI. On the gross-to-net front, we haven't broken it down specifically by quarter, but the third quarter was similar to the second quarter, slightly lower. We would expect that to increase in the fourth quarter. Overall, for the year, we're expecting to come out right around the 20% mark. That's about as much of the guidance as we can provide at this point, but hopefully, that gives you a better sense for how to model that out, Gavin.

Gavin Clark-Gartner (Managing Director of Biotech Equity Research)

Yeah, that's really helpful. Thanks, guys.

Eric Dube (President and CEO)

Thank you.

Operator (participant)

Mohit Bansal from Wells Fargo, your line is open.

Thanks for taking my question and congrats on the progress. In FSGS, I think we might see some data from Novartis soon with atrasentan from their basket trial. Can you talk about advantages you see with a dual ERA mechanism in this indication, compared with an agent like atrasentan, which doesn't have the RAS inhibitor component, especially this being an indication where there is not as high background use of RAS inhibitors compared with IgAN? Thanks.

Eric Dube (President and CEO)

Thanks for that question. Jula, why don't we have you answer that?

Jula Inrig (CMO)

Certainly. It is quite important in FSGS, which is a true podocytopathy that's at the heart of the disease, to target it with both endothelin and angiotensin II together to have the greatest nephroprotective potential. We also see that with the magnitude of proteinuria reduction we see in this patient population of FILSPARI being used, we see about a 50% reduction in proteinuria that's durable out to 2 years. That's where we have the confidence that this is the right way to target these patients to provide them long-term kidney protection. I understand there might be some use of single agents. I won't comment on the lack of data that we have regarding atrasentan. We really haven't seen anything to date, so I can't comment on what that gap might leave behind when you don't target both mechanisms.

We know when we target both mechanisms, we get more patients into complete remission as well as greater reductions in proteinuria in FSGS, and that's what really matters.

Got it. Thank you.

Eric Dube (President and CEO)

Thank you.

Operator (participant)

Prakhar Agrawal from Cantor, your line is open.

Prakhar Agrawal (Managing Director)

Hi. Thank you for taking my questions. Novartis during their earnings said that they have 20% NBRx share, 10% of that is coming from VANRAFIA, and the rest is from Fabhalta. If you can expand on where you are seeing VANRAFIA and Fabhalta as gaining share. Another follow-up on IgAN, you said September was the strongest month, and October is, you're also seeing good consistent demand. Should we expect the new patient start forms to increase sequentially in Q4? Thank you.

Eric Dube (President and CEO)

Thank you for the questions. Peter, why don't you take those?

Peter Heerma (CCO)

Yeah, I'm happy to take that question. I mean, what we have seen, and I mentioned that before, is that we see very consistent and steadily growing demand since we had our full approval in September last year. The launch of atrasentan or iptacopan has not really changed that. I mean, iptacopan was launched basically at the same time as we had full approval. Atrasentan was launched like 6 months ago, but it hasn't really changed our trajectory and our continuation of the momentum. I couldn't be more pleased with the execution and what we are seeing. I think now with the REMS modification, as well as the KDIGO guidelines, I think those are additional momentum builders for us. I remain very confident in a more competitive landscape.

Eric Dube (President and CEO)

Yeah. Just to add with regard to whether you can expect sequential increase, we've not provided guidance. What Peter shared in the past is, I think, two really important components of that. One is we expect that demand to be above 700 in terms of that quarterly demand. We certainly have seen that, as he talked about. Also, we think about the large opportunity to be able to have these patients move from RAS inhibition to dual inhibition with something like FILSPARI or the addition of the ERA. Most of these patients still are on only-RAS, so there's a tremendous opportunity for growth. We're clearly making that progress. We're seeing those occur. I don't want to speak about other companies' performance. They're clearly helping to be able to increase the shift from RAS inhibition. As you can see, we've not really seen an impact from their launches.

Operator (participant)

Maury Raycroft from Jefferies, your line is open.

Maury Raycroft (Equity Research Analyst)

Hi, congrats on the quarter, and thanks for taking my question. You mentioned that your increased SG&A for the third quarter includes additional investment in preparation for a potential FSGS launch. Can you talk more about how you're prepping for the launch and how we should think about SG&A expectations going forward?

Eric Dube (President and CEO)

Sure. Peter, why don't you take the question with regard to how your team is preparing for the approval? Chris, you can talk about SG&A.

Peter Heerma (CCO)

Yeah, happy to do that. Maury, first of all, I think it's good to realize that this is basically the same prescriber base in FSGS as what we have seen for IgA nephropathy. Basically, the only nephrology segment that we haven't called upon is the pediatric nephrology, but overall, there's a high level of overlap. We build upon strengths and high brand familiarity. We will have an incremental increase in our commercial footprint to really continue that momentum in IgA nephropathy while also enabling the early uptake that we are envisioning for FILSPARI. We are building upon strengths. Like I said, we have that incremental increase of our commercial footprint.

Chris Cline (CFO)

As you can take from Peter's comments with bringing on some additional sales team members and some other support services here, we do expect to see an incremental increase in SG&A. We started to onboard a number of those people this quarter, but really, you'll see more of that effect in Q4 and going forward. Around the time of launch, you would also anticipate that we'll have an increase in investment level as we're really making sure that we're providing the right resources to have a very strong start out of the gates early next year. Incremental increases as we go, but we are building from a very strong base, and we're going to be able to leverage a lot of synergies from Peter's team that's performing quite well right now.

Maury Raycroft (Equity Research Analyst)

Got it. Okay. Thanks for taking my—

Eric Dube (President and CEO)

Thanks, Maury.

Operator (participant)

Jason Zemansky from Bank of America, your line is open.

Jason Zemansky (VP of Equity Research)

Good afternoon. Congrats on the great progress, and thanks for taking our question. I wanted to revisit the efforts to now completely remove the REMS. First, given the acceleration in patient starts here and therefore overall exposure to FILSPARI, have your timelines changed at all? Any other updates on this front now that the original REMS modification has occurred? Thanks.

Eric Dube (President and CEO)

Thanks, Jason. Bill, why don't you take that question?

Bill Rote (Chief Research Officer)

Sure. We're excited about the REMS modification that was granted in August. I think we've seen the tailwinds that provides and the positive feedback from physicians and patients. Our strategy has always been for ultimate removal of the REMS. With our prior interactions with the agency, we've approached it with a two-step process, seeking the frequency change first and then removal second. As we've noted in the past, the FDA has been anchored on our PMR study, which requires exposure across about 3,000 patients for 2 years. Our process really hasn't changed. Consistent with our approach, we'll continue to engage with the agency and align with them on our next steps.

Operator (participant)

Alex Thompson from Stifel, line is open.

Alex Thompson (Managing Director)

Hey, great. Thanks for taking our question. Maybe a follow-up on the commentary on some off-label FSGS use. I wonder if you could comment as to whether those patients are coming in at about 2x the IgAN dose or if they're still early in their treatment course and maybe not titrate up fully yet. Thanks.

Eric Dube (President and CEO)

Alex, thanks for the question. We do have limited insight into some of that information, and I would not want to generalize around the dosing at this point. I think what's important is that upon an approval, we would make sure that physicians are appropriately educated on the label, on the target dose. Of course, as we have with IgAN, we've got strong patient services support for the patients and their offices to ensure that they're at the appropriate dose.

Operator (participant)

Joe Pantginis from H.C. Wainwright, your line is open.

Joe Pantginis (Managing Director of Equity Research)

Hi, thanks, and good afternoon. First, I want to talk more about the expenses that you mentioned earlier, but to the totality of the expenses going forward. I won't ask you to project profitability timing, but I guess, can you directionally speak to, especially R&D going forward as you're going to bring peg back into the clinic and how we should sort of view that, offset by FILSPARI revenues? Secondly, just curious with regard to Renalys and Chugai, any change in timelines for development of sparsentan in Japan, South Korea, and Taiwan?

Eric Dube (President and CEO)

Joe, thanks for the questions. I'll quickly address the last one and then turn it over to Chris to answer the questions on expenses. No change in timelines. We've been incredibly impressed with the speed and quality of work from Renalys. We have a high regard for Chugai Pharmaceutical. We would expect that they would be just as focused when they initiate the FSGS and Alport syndrome programs. We can't speak for them, but what I can say is what we've seen thus far has been very impressive. Chris?

Chris Cline (CFO)

And Joe, on the R&D front for operating expenses, we're in the midst of the budgeting process now, so I'll be able to come back with a little bit more clarity on that post-Q4. You are right that we do expect to have additional investments for pegtibatinase as that clinical operation really ramps up once we restart.

We're looking at investment there to have that be the fastest enrollment and timeline to top-line data while maintaining quality that we can. For sparsentan, there are, as you might imagine, with DUPLEX and PROTECT, we do see a ramp down in activity in that. There are also other evidence generation efforts that could potentially be helpful, both in IgA nephropathy, but then also in FSGS pending approval here where we believe we can help generate even more value. The last thing I'll highlight with FILSPARI that's still going to be an investment is going to be the transplant studies that recently kicked off and are in the recruiting phase now. There are still investments that we need to make on the R&D front.

To your point or question around the context of end revenue, we expect revenue to continue to grow very nicely and be able to support our efforts here.

Joe Pantginis (Managing Director of Equity Research)

Thank you.

Eric Dube (President and CEO)

Thank you.

Operator (participant)

Ladies and gentlemen, this concludes the question-and-answer session of today's conference call. I'll hand the call back over to Nivi.

Nivi Nehra (VP of Corporate Communications and Investor Relations)

Thank you, everyone, for joining today's call. Have a great rest of your day.

Operator (participant)

This concludes today's conference call. Thank you for participating. You may now disconnect.