Mirum Pharmaceuticals Inc

Previous wording

Livmarli is a novel, orally administered, minimally-absorbed ileal bile acid transporter (“IBAT”) inhibitor (“IBATi”) that is approved for the treatment of cholestatic pruritus in patients with Alagille syndrome (“ALGS”) in the United States (“U.S.”) and various other countries around the world and for cholestatic pruritus in patients with progressive familial intrahepatic cholestasis (“PFIC”) in the U.S. and and for the treatment of PFIC in the European Union (“EU”). We market and commercialize Livmarli in the U.S. and certain countries in Europe through our specialized and focused commercial team. We have also entered into license and distribution agreements with several rare disease companies for the commercialization of Livmarli in additional countries.

Current wording

Livmarli is a novel, orally administered, minimally-absorbed ileal bile acid transporter (“IBAT”) inhibitor (“IBATi”) that is approved for the treatment of cholestatic pruritus in patients with Alagille syndrome (“ALGS”) in the United States (“U.S.”) and various other countries around the world and for cholestatic pruritus in patients with progressive familial intrahepatic cholestasis (“PFIC”) in the U.S. and for the treatment of PFIC in the European Union (“EU”). We market and commercialize Livmarli in the U.S. and certain countries in Europe through our specialized and focused commercial team. We have also entered into license and distribution agreements with several rare disease companies for the commercialization of Livmarli in additional countries.

Previous wording

On August 31, 2023, we completed the acquisition of assets of Travere Therapeutics, Inc. (“Travere”) that are primarily related to the development, manufacture (including synthesis, formulation, finishing or packaging) and commercialization of Chenodal and Cholbam (also known as Kolbam, and together with Chenodal, the “Bile Acid Medicines”) pursuant to an asset purchase agreement dated July 16, 2023 (such acquisition, the “Bile Acid Portfolio Acquisition”). The FDA approved Cholbam in March 2015, as the first FDA-approved treatment for pediatric and adult patients with bile acid synthesis disorders due to single enzyme defects, and for adjunctive treatment of patients with peroxisome biogenesis disorder-Zellweger spectrum disorder (“PBD-ZSD”) and Smith-Lemli-Opitz syndrome (“SLOS”). Chenodal is approved for the treatment of radiolucent stones in the gallbladder and has received medical necessity recognition by the FDA for the treatment of cerebrotendinous xanthomatosis (“CTX”). We commercialize Chenodal and Cholbam in the U.S. through our specialized and focused commercial team. We have also assumed several license and distribution agreements with several rare disease companies for the commercialization of Chenodal and Cholbam in additional countries. In October 2023, we reported positive topline data from our RESTORE clinical trial evaluating Chenodal in patients with CTX and we submitted a new drug application for chenodiol for the treatment of CTX to the FDA in June 2024.

Current wording

On August 31, 2023, we completed the acquisition of assets of Travere Therapeutics, Inc. (“Travere”) that are primarily related to the development, manufacture (including synthesis, formulation, finishing or packaging) and commercialization of Chenodal and Cholbam (also known as Kolbam, and together with Chenodal, the “Bile Acid Medicines”) pursuant to an asset purchase agreement dated July 16, 2023 (such acquisition, the “Bile Acid Portfolio Acquisition”). The FDA approved Cholbam in March 2015, as the first FDA-approved treatment for pediatric and adult patients with bile acid synthesis disorders due to single enzyme defects, and for adjunctive treatment of patients with peroxisome biogenesis disorder-Zellweger spectrum disorder (“PBD-ZSD”) and Smith-Lemli-Opitz syndrome (“SLOS”). Chenodal is approved for the treatment of radiolucent stones in the gallbladder and has received medical necessity recognition by the FDA for the treatment of cerebrotendinous xanthomatosis (“CTX”). We commercialize Chenodal and Cholbam in the U.S. through our specialized and focused commercial team. We have also assumed several license and distribution agreements with several rare disease companies for the commercialization of Chenodal and Cholbam in additional countries. In October 2023, we reported positive topline data from our RESTORE clinical trial evaluating Chenodal in patients with CTX and we submitted a new drug application (“NDA”) for chenodiol for the treatment of CTX to the FDA in June 2024, which application has been assigned a Prescription Drug User Fee Act (“PDUFA”) date of December 28, 2024.

Previous wording

VISTAS Phase 2b clinical trial in PSC and reported interim data from our VANTAGE Phase 2b clinical trial in PBC in June 2024. Interim results from the study demonstrated a statistically significant (-3.82, p < 0.0001; change from baseline) improvement in pruritus for volixibat and a placebo-adjusted difference of -2.32 points in the primary endpoint (p=0.0026), as measured by the trial’s zero to ten numerical rating scale identified as the Adult ItchRO scale. In addition, 75% of patients on volixibat achieved a greater than 50% reduction in serum bile acids, and there was an improvement in fatigue at week 16 with volixibat compared to placebo. No new safety signals were observed, and adverse events were similar between the 20 mg and 80 mg treatment groups. The most common adverse event was diarrhea (77%) with all cases mild to moderate; one case resulted in discontinuation. Four patients experienced serious adverse events, including one in the placebo arm. There were no clinically meaningful changes in liver biomarkers. A volixibat dose of 20 mg twice daily was selected for part 2 of the study. The interim analysis for the VISTAS Phase 2b clinical trial in PSC was conducted and the independent data review committee recommended the study continue with a selected volixibat dose of 20 mg twice daily, with no changes to the study. The criteria for continuation included safety as well as a predefined threshold for efficacy. We and the investigators remain blinded to the PSC interim results and analyses.

Current wording

We are developing Livmarli for certain rare cholestatic conditions through the Phase 3 EXPAND study, which we expect to initiate in the second half of 2024. In addition, we are advancing our product candidate volixibat, a novel, oral, minimally-absorbed agent designed to inhibit IBAT, for the treatment of adult patients with cholestatic liver diseases. We are developing volixibat in the setting of primary sclerosing cholangitis (“PSC”) and primary biliary cholangitis (“PBC”), and in October 2024, we announced that the FDA granted Breakthrough Therapy Designation for volixibat as a potential treatment for cholestatic pruritus in patients with PBC. Volixibat has been studied in over 400 adults for up to 48 weeks. Clinical trials of volixibat have shown significant activity on IBAT and bile acid markers such as 7αC4, fecal bile acids and cholesterol, demonstrating potent biological activity. We conducted an interim analysis of our VISTAS Phase 2b clinical trial in PSC and reported interim data from our VANTAGE Phase 2b clinical trial in PBC in June 2024. Interim results from the study demonstrated a statistically significant (-3.82, p < 0.0001; change from baseline) improvement in pruritus for volixibat and a placebo-adjusted difference of -2.32 points in the primary endpoint (p=0.0026), as measured by the trial’s zero to ten numerical rating scale identified as the Adult ItchRO scale. In addition, 75% of patients on volixibat achieved a greater than 50% reduction in serum bile acids, and there was an improvement in fatigue at week 16 with volixibat compared to placebo. No new safety signals were observed, and adverse events were similar between the 20 mg and 80 mg treatment groups. The most common adverse event was diarrhea (77%) with all cases mild to moderate; one case resulted in discontinuation. Four patients experienced serious adverse events, including one in the placebo arm. There were no clinically meaningful changes in liver biomarkers. A volixibat dose of 20 mg twice daily was selected for part 2 of the study. The blinded interim analysis for the VISTAS Phase 2b clinical trial in PSC was conducted and the independent data review committee recommended the study continue with a selected volixibat dose of 20 mg twice daily, with no changes to the study. The criteria for continuation included safety as well as a predefined threshold for efficacy. We and the investigators remain blinded to the PSC interim results and analyses. We expect the VISTAS Phase 2b clinical trial in PSC to complete enrollment in the second half of 2025, and we expect the VANTAGE Phase 2b clinical trial in PBC to complete enrollment in 2026.

Previous wording

We were incorporated in May 2018 and commenced operations in November 2018. To date, we have focused primarily on acquiring and in-licensing our product candidates, organizing and staffing our company, business planning, raising capital, advancing our product candidates through clinical development, preparing for commercialization of our product candidates, commercializing Livmarli, and conducting business development activities relating to, among other things, portfolio expansion through collaborations and acquisitions.

Current wording

We were incorporated in May 2018 and commenced operations in November 2018. To date, we have focused primarily on acquiring and in-licensing our product candidates, organizing and staffing our company, business planning, raising capital, advancing our product candidates through clinical development, preparing for commercialization of our product candidates, commercializing our approved medicines, and conducting business development activities relating to, among other things, portfolio expansion through collaborations and acquisitions.

Previous wording

Our net loss was $24.6 million and $74.0 million for the three months ended June 30, 2024 and 2023, respectively, and $49.9 million and $104.2 million for the six months ended June 30, 2024 and 2023, respectively. As of June 30, 2024, we had an accumulated deficit of $606.2 million, compared to $556.2 million as of December 31, 2023. As of June 30, 2024, we had unrestricted cash, cash equivalents and investments of $295.4 million, compared to cash and cash equivalents of $286.3 million as of December 31, 2023.

Current wording

Our net loss was $14.2 million and $23.6 million for the three months ended September 30, 2024 and 2023, respectively, and $64.2 million and $127.8 million for the nine months ended September 30, 2024 and 2023, respectively. As of September 30, 2024, we had an accumulated deficit of $620.4 million, compared to $556.2 million as of December 31, 2023. As of September 30, 2024, we had unrestricted cash, cash equivalents and investments of $293.8 million, compared to cash and cash equivalents of $286.3 million as of December 31, 2023.

Previous wording

We anticipate we will continue to generate net losses for the foreseeable future as we continue commercial activities for our approved medicines, conduct our ongoing and planned clinical trials, seek regulatory approvals for our product candidates and make potential milestone payments to the licensors and other third parties from whom we have in-licensed or acquired our product candidates. We expect total product sales of our approved medicines will continue to increase on an annual basis. We have entered into license and collaboration arrangements with other companies whereby we are entitled to receive upfront and license fees, development and sales-based milestones, and tiered royalties based on sales of commercialized products. In select countries, we have entered into distribution agreements for the sale of our approved medicines and such distributors may have fluctuating purchase levels. As a result, our net losses may fluctuate significantly from quarter-to-quarter and year-to-year.

Current wording

We anticipate we will continue to generate net losses for the foreseeable future as we continue commercial activities for our approved medicines, conduct our ongoing and planned clinical trials, seek regulatory approvals for our product candidates and make potential milestone payments to the licensors and other third parties from whom we have in-licensed or acquired our product candidates. We expect that total product sales of our approved medicines will continue to increase on an annual basis. We have entered into license and collaboration arrangements with other companies whereby we are entitled to receive upfront and license fees, development and sales-based milestones, and tiered royalties based on sales of commercialized products. In select countries, we have entered into distribution agreements for the sale of our approved medicines and such distributors may have fluctuating purchase levels. As a result, our net losses may fluctuate significantly from quarter-to-quarter and year-to-year.

Previous wording

As of the date of our acquisition of the Bile Acid Medicines from Travere, inventory acquired was valued at its fair value. As a result, our cost of sales exceeds the historical cost to manufacture the inventory and has a negative impact on our gross margin. We expect to sell the majority of acquired inventory that is recorded at fair value within the next year from the balance sheet date. In addition, in connection with the acquisition, we have firm commitments for the purchase of minimum order quantities for active pharmaceutical ingredients. We periodically evaluate these firm commitments to determine if these commitments are in excess of our needs. If any net loss is determined, we record a charge to cost of sales in the period identified.

Current wording

As of the date of our acquisition of the Bile Acid Medicines from Travere, inventory acquired was valued at its fair value. As a result, our cost of sales exceeds the historical cost to manufacture the inventory and has a negative impact on our gross margin. We expect to sell the majority of acquired inventory that is recorded at fair value within the next six to nine months from the balance sheet date. In addition, in connection with the acquisition, we have firm commitments for the purchase of minimum order quantities for active pharmaceutical ingredients. We periodically evaluate these firm commitments to determine if these commitments are in excess of our needs. If any net loss is determined, we record a charge to cost of sales in the period identified.

Previous wording

•external expenses paid to clinical trial sites, contract research organizations and consultants that conduct our clinical trials;

Current wording

•external expenses paid to clinical trial sites, contract research organizations (“CROs”) and consultants that conduct our clinical trials;

Previous wording

Loss from termination of revenue interest purchase agreement is related to the repurchase and termination of the RIPA in the second quarter of 2023. The repurchase payment included a premium over the remaining revenue interest liability and resulted in the recognition of a loss from termination of the RIPA in our condensed consolidated statements of operations and comprehensive loss.

Current wording

Loss from termination of revenue interest purchase agreement is related to the repurchase and termination of the Revenue Interest Purchase Agreement (the “RIPA”) with Mulholland SA LLC, an affiliate of Oberland Capital LLC, as agent for the purchasers party thereto (the “Purchasers”), and the Purchasers in the second quarter of 2023. The repurchase payment included a premium over the remaining revenue interest liability and resulted in the recognition of a loss from termination of the RIPA in our condensed consolidated statements of operations and comprehensive loss.

Previous wording

There have been no significant changes during the three and six months ended June 30, 2024 in our critical accounting policies and estimates as compared to the critical accounting policies and estimates disclosed in the section titled “Management’s Discussion and Analysis of Financial Condition and Results of Operations” included in our Annual Report.

Current wording

There have been no significant changes during the three and nine months ended September 30, 2024 in our critical accounting policies and estimates as compared to the critical accounting policies and estimates disclosed in the section titled “Management’s Discussion and Analysis of Financial Condition and Results of Operations” included in our Annual Report.

Previous wording

Product sales, net was $77.8 million for the three months ended June 30, 2024, compared to $32.5 million for the three months ended June 30, 2023. The increase in product sales, net was a result of sales of the Bile Acid Medicines following the completion of the Bile Acid Portfolio Acquisition in August 2023 and our continued commercialization of Livmarli in the U.S. and in certain international markets directly or through partner market supply orders.

Current wording

Product sales, net was $90.3 million for the three months ended September 30, 2024, compared to $47.7 million for the three months ended September 30, 2023. The increase in product sales, net was a result of sales of the Bile Acid Medicines following the completion of the Bile Acid Portfolio Acquisition in August 2023 and our continued commercialization of Livmarli in the U.S. for the treatment of ALGS and PFIC, and in certain international markets directly or through partner market supply orders for the treatment of ALGS.

Previous wording

For the three months ended June 30, 2024, cost of sales was $20.2 million, compared to $6.8 million for the three months ended June 30, 2023. The increase in cost of sales was primarily a result of increased royalty expense of $4.6 million on net sales of Livmarli and the Bile Acid Medicines under licensing agreements, $4.3 million of amortization of acquired intangibles primarily associated with our acquisition of the Bile Acid Medicines in August 2023, increased product cost of sales of $3.1 million related to the Bile Acid Medicines and to a lesser extent for Livmarli, increased excess inventory reserves of $0.7 million and other period costs of $0.7 million associated with increased commercial supply chain expenses and other general expenses.

Current wording

For the three months ended September 30, 2024, cost of sales was $20.8 million, compared to $10.2 million for the three months ended September 30, 2023. The increase in cost of sales was primarily a result of increases in royalty expense of $4.3 million on net sales of Livmarli and the Bile Acid Medicines under licensing agreements, amortization expense of $3.3 million primarily due to acquired intangibles associated with our acquisition of the Bile Acid Medicines in August 2023, product cost of sales of $1.8 million related to the Bile Acid Medicines and, to a lesser extent, Livmarli, and other period costs of $1.2 million associated with commercial supply chain expenses and other general expenses.

Previous wording

•for personnel related expenses, an increase of $1.6 million related to increased employee headcount to support our development pipeline; and

Current wording

•for personnel related expenses, an increase of $2.1 million related to increased employee headcount to support our development pipeline; and

Previous wording

•for other expense, an increase of $3.1 million, primarily due to other general research and development activities.

Current wording

•for other expense, an increase of $1.9 million, primarily due to other general research and development activities; partially offset by

Previous wording

Selling, general and administrative expenses were $94.8 million for the six months ended June 30, 2024, an increase of $31.7 million compared to the six months ended June 30, 2023. The increase was primarily due to an increase of $13.0 million in personnel and other compensation related expenses, including an increase of $4.0 million in stock-based compensation, reflecting an increase in the number of our selling, marketing and administrative employees to support commercial activities for our approved medicines, an increase of $9.7 million in advertising, promotion and medical affairs expenses associated with commercial activities for our approved medicines, an increase of $6.7 million in expenses primarily related to accounting, legal, compliance, public relations and international expansion activities and an increase of $2.2 million in other general administrative expenses.

Current wording

Selling, general and administrative expenses were $50.5 million for the three months ended September 30, 2024, an increase of $14.0 million compared to the three months ended September 30, 2023. The increase was primarily due to increases of $8.6 million in personnel and other compensation-related expenses, including an increase of $2.3 million in stock-based compensation, reflecting an increase in the number of our selling, marketing and administrative employees to support commercial activities for our approved medicines, $4.2 million in advertising, promotion and medical affairs expenses associated with commercial activities primarily driven by the Bile Acid Portfolio Acquisition completed in August 2023, and $0.5 million in other general administrative expenses.

Previous wording

Interest income was $3.5 million for the three months ended June 30, 2024, a decrease of $0.1 million compared to the three months ended June 30, 2023.

Current wording

Interest income was $3.5 million for the three months ended September 30, 2024, a decrease of $0.6 million compared to the three months ended September 30, 2023 largely due to lower yields on investments.

Previous wording

Other income (expense), net was income of $2.1 million for the six months ended June 30, 2024, compared to expense of $1.1 million for the six months ended June 30, 2023. The income for the six months ended June 30, 2024 was primarily attributable to unrealized currency gains on net assets and liabilities denominated in foreign currency. The expense for the six months ended June 30, 2023 primarily related to fair value remeasurement of liabilities associated with our acquisition of Satiogen.

Current wording

Other income (expense), net was expense of $1.1 million for the three months ended September 30, 2024, compared to income of $1.3 million for the three months ended September 30, 2023. The expense for the three months ended September 30, 2024 and the income for the three months ended September 30, 2023, were primarily attributable to unrealized currency gains on net assets and liabilities denominated in foreign currency and reflect the fluctuation in currency rates during those periods.

Previous wording

The following table summarizes our results of operations for the six months ended June 30, 2024 and 2023 (in thousands):

Current wording

The following table summarizes our results of operations for the nine months ended September 30, 2024 and 2023 (in thousands):

Previous wording

Product sales, net was $146.7 million for the six months ended June 30, 2024, compared to $61.6 million for the six months ended June 30, 2023. The increase in product sales, net was a result of sales of the Bile Acid Medicines following the completion of the Bile Acid Portfolio Acquisition in August 2023 and our continued commercialization of Livmarli in the U.S. and in certain international markets directly or through partner market supply orders.

Current wording

Product sales, net was $237.0 million for the nine months ended September 30, 2024, compared to $109.3 million for the nine months ended September 30, 2023. The increase in product sales, net was a result of sales of the Bile Acid Medicines following the completion of the Bile Acid Portfolio Acquisition in August 2023 and our continued commercialization of Livmarli in the U.S., for the treatment of ALGS and PFIC and in certain international markets directly or through partner market supply orders for the treatment of ALGS.

Previous wording

License and other revenue was $0.4 million for the six months ended June 30, 2024, compared to $7.5 million for the six months ended June 30, 2023. The decrease in license and other revenue was primarily due to the achievement of regulatory milestones by CANbridge and GC Biopharma associated with our license agreements in 2023.

Current wording

License and other revenue was $0.5 million for the nine months ended September 30, 2024, compared to $7.5 million for the nine months ended September 30, 2023. The decrease in license and other revenue was primarily due to the achievement of regulatory milestones by CANbridge and GC Biopharma associated with our license agreements in 2023.

Previous wording

For the six months ended June 30, 2024, cost of sales was $38.1 million, compared to $11.8 million for the six months ended June 30, 2023. The increase in cost of sales was primarily a result of increased royalty expense of $8.6 million on net sales of Livmarli and the Bile Acid Medicines under licensing agreements, $8.5 million of amortization of acquired intangibles primarily associated with our acquisition of the Bile Acid Medicines in August 2023, increased product cost of sales of $6.0 million related to the Bile Acid Medicines and to a lesser extent for Livmarli, other period costs of $2.1 million associated with increased commercial supply chain expenses and other general expenses and increased excess inventory reserves of $1.0 million.

Current wording

For the nine months ended September 30, 2024, cost of sales was $58.9 million, compared to $22.0 million for the nine months ended September 30, 2023. The increase in cost of sales was primarily a result of increases in royalty expense of $12.9 million on net sales of Livmarli and the Bile Acid Medicines under licensing agreements, amortization expense of $11.8 million primarily due to acquired intangibles associated with our acquisition of the Bile Acid Medicines in August 2023, product cost of sales of $7.7 million related to the Bile Acid Medicines and, to a lesser extent, Livmarli, other period costs of $4.4 million associated with commercial supply chain expenses and other general expenses.

Previous wording

•for volixibat programs, an increase of $5.4 million, primarily due to increased expenses associated with conduct of the PSC and PBC trials of $6.2 million, partially offset by lower expenses of $0.6 million related to discontinuation of the intrahepatic cholestasis of pregnancy clinical trial;

Current wording

•for volixibat programs, an increase of $8.6 million, primarily due to increased expenses associated with conduct of the PSC and PBC trials;

Previous wording

•for stock-based compensation, an increase of $2.0 million associated with incremental employee equity awards;

Current wording

•for stock-based compensation, an increase of $3.0 million associated with incremental employee equity awards;

Previous wording

•for personnel related expenses, an increase of $4.4 million related to increased employee headcount to support our development pipeline; and

Current wording

•for personnel related expenses, an increase of $6.5 million related to increased employee headcount to support our development pipeline; and

Previous wording

•for other expense, an increase of $6.4 million, primarily due to other general research and development activities.

Current wording

•for other expense, an increase of $8.1 million, primarily due to other general research and development activities, including expenses related to the Bile Acid Medicines acquired in August of 2023, partially offset by

Previous wording

Selling, general and administrative expenses were $49.2 million for the three months ended June 30, 2024, an increase of $16.3 million compared to the three months ended June 30, 2023. The increase was primarily due to an increase of $7.1 million in personnel and other compensation-related expenses, including an increase of $2.3 million in stock-based compensation, reflecting an increase in the number of our selling, marketing and administrative employees to support commercial activities for our approved medicines, an increase of $5.5 million in advertising, promotion and medical affairs expenses associated with commercial activities for our approved medicines, an increase of $3.2 million in expenses primarily related to accounting, legal, compliance, public relations and international expansion activities., and an increase of $0.5 million in other general administrative expenses.

Current wording

Selling, general and administrative expenses were $145.4 million for the nine months ended September 30, 2024, an increase of $45.7 million compared to the nine months ended September 30, 2023. The increase was primarily due to increases of $21.6 million in personnel and other compensation related expenses, including an increase of $6.3 million in stock-based compensation, reflecting an increase in the number of our selling, marketing and administrative employees to support commercial activities for our approved medicines, $12.7 million in advertising, promotion and medical affairs expenses associated with commercial activities for our approved medicines, $8.0 million in expenses primarily related to accounting, legal, compliance, public relations and international expansion activities and $3.0 million in other general administrative expenses.

Previous wording

Loss from termination of RIPA was zero for the three months ended June 30, 2024, compared to $49.1 million for the three months ended June 30, 2023. The 2023 loss was related to the premium paid to repurchase the revenue interests pursuant to the RIPA.

Current wording

Loss from termination of RIPA was zero for the nine months ended September 30, 2024, compared to $49.1 million for the nine months ended September 30, 2023. The 2023 loss was related to the premium paid to repurchase the revenue interests pursuant to the RIPA.

Previous wording

Interest income was $7.1 million for the six months ended June 30, 2024, an increase of $1.2 million compared to the six months ended June 30, 2023. The increase was primarily due to higher interest earned on our cash equivalents and investment balances largely due to higher money market yields and higher invested balances.

Current wording

Interest income was $10.6 million for the nine months ended September 30, 2024, an increase of $0.6 million compared to the nine months ended September 30, 2023. The increase was primarily due to higher invested balances, partially offset by lower yields on investments.

Previous wording

Interest expense was $7.1 million for the six months ended June 30, 2024, a decrease of $0.8 million compared to the six months ended June 30, 2023. For the six months ended June 30, 2024, interest expense consisted of $7.1 million related to our convertible notes. For the six months ended June 30, 2023, interest expense consisted of $2.9 million related to our convertible notes issued during the period and $5.1 million related to the RIPA prior to extinguishment.

Current wording

Interest expense was $10.7 million for the nine months ended September 30, 2024, a decrease of $0.8 million compared to the nine months ended September 30, 2023. For the nine months ended September 30, 2024, interest expense consisted of $10.7 million related to our convertible notes. For the nine months ended September 30, 2023, interest expense consisted of $6.5 million related to our convertible notes issued during the period and $5.1 million related to the RIPA prior to extinguishment.

Previous wording

Other income (expense), net was income of $0.3 million for the three months ended June 30, 2024, compared to expense of $0.3 million for the three months ended June 30, 2023. The income for the three months ended June 30, 2024 was primarily attributable to unrealized currency gains on net assets and liabilities denominated in foreign currency. The expense for the three months ended June 30, 2023 primarily related to fair value remeasurement of liabilities associated with our acquisition of Satiogen and realized currency gains and losses on net assets and liabilities denominated in foreign currency.

Current wording

Other income (expense), net was income of $1.0 million for the nine months ended September 30, 2024, compared to income of $0.2 million for the nine months ended September 30, 2023. The income for the nine months ended September 30, 2024 was primarily attributable to unrealized currency gains on net assets and liabilities denominated in foreign currency. The income for the nine months ended September 30, 2023 was primarily attributable to $1.2 million unrealized currency gains on net assets and liabilities denominated in foreign currency, offset by $0.7 million expense associated with the fair value remeasurement of liabilities associated with our acquisition of Satiogen.

Previous wording

Since inception, we have funded our operations primarily through debt, equity, revenue interest financings and, to a lesser extent, cash from our product sales and license and collaboration revenue. We had $295.4 million of unrestricted cash, cash equivalents and investments as of June 30, 2024, compared to cash and cash equivalents of $286.3 million as of December 31, 2023. Since inception, we have incurred operating losses and negative cash flows from operations. As of June 30, 2024, we had an accumulated deficit of $606.2 million, compared to $556.2 million as of December 31, 2023.

Current wording

Since inception, we have funded our operations primarily through debt, equity, revenue interest financings and, to a lesser extent, cash from our product sales and license and collaboration revenue. We had $293.8 million of unrestricted cash, cash equivalents and investments as of September 30, 2024, compared to cash and cash equivalents of $286.3 million as of December 31, 2023. Since inception, we have incurred operating losses and negative cash flows from operations. As of September 30, 2024, we had an accumulated deficit of $620.4 million, compared to $556.2 million as of December 31, 2023.

Previous wording

In August 2020, the SEC declared effective the 2020 Shelf Registration covering the sale of up to $300.0 million of our securities. Also, in August 2020, we entered into the 2020 Sales Agreement with Leerink pursuant to which we could issue and sell, in an at the market offering, from time to time, shares of common stock having an aggregate offering price of up to $75.0 million under the 2020 Shelf Registration through Leerink acting as the sales agent and/or principal. The 2020 Shelf Registration expired in August 2023, and no further sales may be made under the 2020 Sales

Current wording

In August 2020, the SEC declared effective a registration statement on Form S-3 (the “2020 Shelf Registration”) covering the sale of up to $300.0 million of our securities. Also, in August 2020, we entered into a sales agreement (the “2020 Sales Agreement”) with SVB Securities LLC, subsequently acquired by Leerink Partners LLC (“Leerink”), pursuant to which we could issue and sell, in an at the market offering, from time to time, shares of common stock having an aggregate offering price of up to $75.0 million under the 2020 Shelf Registration through Leerink acting as the sales agent and/or principal. The 2020 Shelf Registration expired in August 2023, and no further sales may be made under the 2020 Sales Agreement. Prior to the expiration of the 2020 Shelf Registration, we issued and sold an aggregate of 2,125,090 shares of common stock pursuant to the 2020 Sales Agreement, resulting in aggregate gross proceeds to us of $43.7 million.

Previous wording

We anticipate that we will continue to incur net losses for the foreseeable future as we continue research efforts and the development of our product candidates, continue commercialization activities for our approved medicines and potentially expand into additional markets, hire additional staff, including clinical, scientific, operational, financial and management personnel and pay potential development and commercial and sales based milestones.

Current wording

We anticipate that we will continue to incur net losses for the foreseeable future as we continue research efforts and the development of our product candidates, continue commercialization activities for our approved medicines and potentially expand into additional markets, hire additional staff, including clinical, scientific, operational, financial and management personnel and pay potential development and commercial and sales based milestones. Net loss is also impacted by significant non-cash charges related to stock-based compensation and amortization of intangible assets.

Previous wording

Although Livmarli has been approved for the treatment of cholestatic pruritus in patients with ALGS in the U.S. and various other countries around the world and for cholestatic pruritus in patients with PFIC in the U.S. and PFIC in the EU and we expect product revenues to increase as we continue commercial activities, Livmarli may not achieve commercial success. Certain of our approved medicines, including the Bile Acid Medicines, are subject to immediate competition from compounded and generic entrants, as the ANDA and NDA for these drug products have no remaining or current patent or non-patent exclusivity. In addition, Chenodal is approved for radiolucent stones in the gallbladder yet is used primarily as standard of care for CTX. The FDA has provided a letter acknowledging Chenodal as a medical necessity for CTX, but prescriptions for this indication are not on label. As such, any change in this view from the FDA could adversely affect our ability to sell Chenodal in this indication. Unless and until Chenodal is approved for CTX, we cannot market or promote Chenodal for CTX which limits its growth potential.

Current wording

Although we expect product revenues to increase as we continue commercial activities for our approved medicines, we may not achieve commercial success. Certain of our approved medicines, including the Bile Acid Medicines, are subject to immediate competition from compounded and generic entrants, as the abbreviated new drug application (“ANDA”) and NDA for these drug products have no remaining or current patent or non-patent exclusivity. In addition, Chenodal is approved for radiolucent stones in the gallbladder yet is used primarily as standard of care for CTX. The FDA has provided a letter acknowledging Chenodal as a medical necessity for CTX, but prescriptions for this indication are not on label. As such, any change in this view from the FDA could adversely affect our ability to sell Chenodal in this indication. Unless and until Chenodal is approved for CTX, we cannot market or promote Chenodal for CTX which limits its growth potential.

Previous wording

Net cash provided by operating activities was $11.4 million for the six months ended June 30, 2024, reflecting our net loss of $49.9 million partially offset by non-cash adjustments of $40.4 million. Non-cash adjustments consisted primarily of $23.3 million of stock-based compensation, $11.5 million of depreciation and amortization of our intangible assets and fixed assets, $4.6 million related to the cost of sale of inventory acquired in the Bile Acid Portfolio Acquisition and a $1.7 million charge associated with excess and obsolete inventory and firm commitment losses, offset by $2.1 million of unrealized foreign exchange gains. Additionally, cash provided by operating activities reflected changes in net operating assets of $20.9 million, consisting primarily of a $7.5 million decrease in accounts receivable due to timing of payments received related to sales of our approved medicines, a $18.2 million increase in accounts payable, accrued expenses and other liabilities resulting primarily from a $13.6 million increase in accrued sales deductions due to our product sales in the six months ended June 30, 2024, a $2.3 million decrease in prepaid and other current assets and payments made for the purchase of inventory amounting to $6.6 million.

Current wording

Net cash provided by operating activities was $15.4 million for the nine months ended September 30, 2024, reflecting our net loss of $64.2 million partially offset by non-cash adjustments of $55.3 million. Non-cash adjustments consisted primarily of stock-based compensation, depreciation and amortization of our intangible assets and fixed assets, and charges associated with excess and obsolete inventory and firm commitment losses. Additionally, cash provided by operating activities reflected changes in net operating assets of $24.3 million, primarily related to the increase in accounts payable, accrued expenses and other liabilities resulting primarily from an increase in accrued sales deductions and royalties due to the growth from our product sales in the nine months ended September 30, 2024, and an increase in accrued expenses driven by our growth, including accrued expenses related to clinical studies and contract manufacturing activities, offset by payments made for the purchase of inventory.

Previous wording

Net cash used in operating activities was $36.1 million for the six months ended June 30, 2023, reflecting our net loss of $104.2 million partially offset by non-cash items of $74.2 million. Non-cash items consisted primarily of $16.9 million of stock-based compensation, $5.1 million of effective interest expense in connection with the RIPA, $2.7 million of depreciation and amortization of our intangible assets and fixed assets, $0.8 million net accretion of discounts on our investments and $0.5 million expense related to the change in fair value of liabilities arising from our acquisition of Satiogen having to do with certain purchase price adjustments and indemnification obligations and common stock to be issued as contingent consideration upon achievement of a certain milestone. Additionally, cash used in operating activities reflected changes in net operating assets of $6.1 million, consisting primarily of a $8.0 million decrease in accounts payable, accrued expenses and other liabilities, a $11.3 million increase in accounts receivable related to sales of Livmarli, a $1.8 million increase in inventory, a $0.2 million decrease in other assets and a $0.4 million decrease in operating lease liability.

Current wording

Net cash used in operating activities was $54.3 million for the nine months ended September 30, 2023, reflecting our net loss of $127.8 million partially offset by non-cash items of $85.2 million. Non-cash items consisted primarily of loss from termination of RIPA and effective interest expense prior to the termination in April 2023, stock-based compensation, and depreciation and amortization of our intangible assets and fixed assets. Additionally, cash used in operating activities reflected changes in net operating assets of $11.8 million, consisting primarily of an increase in accounts receivables related to sales of our approved medicines, an increase in accounts payable, accrued expenses and other liabilities primarily related to the increase in accrued sales deductions and accrued royalties payable due to our increased net product sales, and an increase in accrued interest expense related to the Notes issued in April 2023.

Previous wording

Net cash provided by investing activities was $77.6 million for the six months ended June 30, 2023, primarily due to proceeds of $120.0 million from maturities of investments, partially offset by $27.3 million used in purchases of investments and $15.0 million for a milestone payment associated with approval of Livmarli by the European Commission for the treatment of cholestatic pruritus in patients with ALGS two months of age and older.

Current wording

Net cash used in investing activities was $105.2 million for the nine months ended September 30, 2023, primarily due to the payment in connection with our acquisition of the Bile Acid Medicines from Travere, purchases of investments and our milestone payment related to the approval of Livmarli by the European Commission for the treatment of cholestatic pruritus in patients with ALGS two months of age and older, partially offset by proceeds from maturities of investments.

Previous wording

Net cash provided by financing activities was $8.5 million for the six months ended June 30, 2024, due to proceeds from employee equity award exercises.

Current wording

Net cash provided by financing activities was $12.4 million for the nine months ended September 30, 2024, due to proceeds from employee equity award exercises.

Previous wording

Net cash provided by financing activities was $127.7 million for the six months ended June 30, 2023, primarily due to net proceeds of $305.3 million from the issuance of convertible notes, net proceeds of $14.5 million from the issuance and sale of common stock under the Sales Agreement with Leerink, pursuant to which we issued and sold an aggregate of 658,206 shares of common stock at a weighted-average price of $22.79 per share, and proceeds of $3.5 million from employee equity award exercises, partially offset by $195.6 million of revenue interest payments made under the RIPA.

Current wording

Net cash provided by financing activities was $334.8 million for the nine months ended September 30, 2023, due to net proceeds from the issuance of convertible notes in April 2023, from the issuance and sale of common stock in a private placement offering in August 2023, from the issuance and sale of common stock under the 2020 Sales Agreement with Leerink during the nine months ended September 30, 2023, and proceeds from employee equity award exercises, partially offset by revenue interest payments and payments to repurchase the revenue interests under the RIPA.