10-K: Akebia Therapeutics Reports 2024 Results, Highlights Vafseo Launch and Pipeline Progress

Akebia Therapeutics details its 2024 financial performance, emphasizing the U.S. launch of Vafseo and advancements in its research and development pipeline.

Summary

• Akebia Therapeutics, Inc. reported its financial results for the year ended December 31, 2024.
• The company is focused on developing and commercializing innovative therapeutics for kidney disease.
• Key products include Vafseo (vadadustat) and Auryxia (ferric citrate).
• Vafseo was approved by the FDA in March 2024 for anemia due to CKD in adult patients on dialysis and was launched in January 2025.
• Auryxia, used for hyperphosphatemia and iron deficiency anemia, will lose exclusivity in March 2025.
• The company is exploring label expansion for Vafseo to include non-dialysis patients.
• Akebia is also advancing preclinical development of two additional HIF molecules, AKB-9090 and AKB-10108.
• Net product revenue for 2024 was $152.2 million, primarily from Auryxia sales.
• The company reported a net loss of $69.4 million for 2024.
• Commercial supply agreements for Vafseo are in place with dialysis organizations caring for nearly 100% of dialysis patients in the U.S.
• The company has a collaborative clinical trial with USRC to evaluate Vafseo outcomes.
• Akebia is pursuing a path for label expansion for Vafseo for CKD non-dialysis dependent patients and intends to initiate a Phase 3 cardiovascular outcome study by the second half of 2025.
• The company is exploring AKB-9090 for potential use in CS-AKI and ARDS, and AKB-10108 for potential use in ROP.
• The company has a license agreement with Cyclerion Therapeutics for praliciguat, an investigational oral sGC stimulator.
• The company is committed to ensuring that every employee is included, supported and treated equitably.
• The company is committed to our employees health, safety and well-being.
• The company is committed to supporting kidney patient communities where we live and work.

Sentiment

Score: 5

Explanation: The document presents a mixed sentiment. While the approval and launch of Vafseo are positive, the loss of exclusivity for Auryxia and the reported net loss create uncertainty. The company's future performance is dependent on successful commercialization and pipeline development.

Positives

• Vafseo received FDA approval and was successfully launched in the U.S. market.
• Commercial supply agreements are in place with dialysis organizations caring for nearly 100% of dialysis patients in the U.S.
• The company is actively pursuing label expansion for Vafseo to include non-dialysis patients.
• The company is advancing preclinical development of two additional HIF molecules, AKB-9090 and AKB-10108.
• The company has a collaborative clinical trial with USRC to evaluate Vafseo outcomes, with more than half of the total target of 2,200 patients enrolled as of early March and full enrollment expected by the end of 2025.

Negatives

• Auryxia will lose exclusivity in March 2025, which is expected to negatively impact revenue.
• The company reported a net loss of $69.4 million for 2024.
• The company has a working capital fund liability with CSL Vifor, which will be repaid through quarterly tiered royalty payments ranging from 8% to 14% of the company's net sales of Vafseo in the U.S., commencing on July 1, 2025.
• The company has identified a material weakness in its internal control over financial reporting as of December 31, 2024 relating to its accounting for inventory and inventory related transactions.

Risks

• The company's ability to generate product revenue and achieve profitability depends on the success of Auryxia, Vafseo, and any future product candidates.
• The company may require substantial additional financing to fund its business, and a failure to obtain this capital could force the company to delay, limit, reduce, or terminate its product development or commercialization efforts.
• The company faces substantial competition, which may result in others discovering, developing, or commercializing products before, or more successfully than, the company does.
• The company's, or its partners', failure to obtain or maintain adequate coverage, pricing, and reimbursement for Auryxia, Vafseo, or any other future approved products could have a material adverse effect on the company's or its collaboration partners' ability to sell such approved products profitably.
• The company is subject to complex regulatory schemes that require significant resources to ensure compliance, and the company's failure to comply with applicable laws could subject the company to government scrutiny or enforcement, potentially resulting in costly investigations, fines, penalties, or sanctions, contractual damages, reputational harm, administrative burdens, and diminished profits and future earnings.
• The company depends on collaborations with third parties for the development and commercialization of Auryxia, Riona, and Vafseo, and if these collaborations are not successful or if the company's collaborators terminate their agreements with the company, the company may not be able to capitalize on the market potential of Auryxia, Riona, and Vafseo, and the company's business could be materially harmed.
• The company relies upon third parties to conduct all aspects of its product manufacturing and commercial distribution, and in many instances only has a single supplier or distributor, and the loss of these manufacturers or distributors, their failure to supply the company on a timely basis, or at all, or their failure to successfully carry out their contractual duties or comply with regulatory requirements, cGMP requirements, or guidance could cause delays in or disruptions to the company's supply chain and substantially harm the company's business.
• The company relies upon third parties to conduct its clinical trials and certain of its preclinical studies, and if they do not successfully carry out their contractual duties, comply with regulatory requirements, or meet expected deadlines, the company may not be able to obtain or maintain marketing approval for Auryxia, Vafseo, or any of the company's product candidates, and the company's business could be substantially harmed.
• If the licensor of certain intellectual property relating to Auryxia terminates, modifies, or threatens to terminate existing contracts or relationships with the company, the company's business may be materially harmed.
• Changes in U.S. and international trade policies, particularly with respect to China and Canada, may adversely impact the company's business and operating results.
• If the company is unable to adequately protect its intellectual property, third parties may be able to use the company's intellectual property, which could adversely affect the company's ability to compete in the market.
• The market entry of one or more generic competitors or any third party's attempt to challenge the company's intellectual property rights will likely limit Auryxia and Vafseo sales and have an adverse impact on the company's business and results of operation.
• The company has identified a material weakness in its internal control over financial reporting as of December 31, 2024 relating to its accounting for inventory and inventory related transactions, and if the company is not able to remediate this material weakness, or if the company experiences additional material weaknesses or other deficiencies in its internal control over financial reporting in the future or otherwise fails to maintain an effective system of internal control over financial reporting, the company may not be able to accurately or timely report its financial results or prevent fraud, and the company may conclude that its internal control over financial reporting is not effective, which may adversely affect the company's business.
• The company's stock price has been and may continue to be volatile, which could result in substantial losses for holders or future purchasers of the company's common stock and lawsuits against the company and its officers and directors and could result in substantial costs and divert management's attention.

Future Outlook

Akebia aims to drive Vafseo to be the standard of care for anemia due to CKD in the U.S. and plans to leverage HIF science and in-licensed technology for future growth within and beyond kidney disease.

Management Comments

• The company is committed to patients and intends to leverage internally developed innovations and explore therapies in other disease areas with high unmet needs.
• The company plans to make strategic use of capital and will also continue its approach of financial discipline, cross-organizational efficiency and operational effectiveness.

Industry Context

The pharmaceutical and biotechnology industries are highly competitive, with several key players offering innovative solutions. The growing prevalence of CKD and the increasing demand for better anemia management solutions continue to drive competition innovation in this market.

Comparison to Industry Standards

• Drugs that may compete with Vafseo include Epogen (epoetin alfa) and Aranesp (darbepoetin alfa), both commercialized by Amgen, Procrit (epoetin alfa) and Eprex (epoetin alfa), commercialized by Johnson & Johnson in the U.S. and Europe, respectively, and Mircera (methoxy PEG-epoetin beta), commercialized by CSL Vifor in the U.S. and Roche Holding Ltd. outside of the U.S. and Evrenzo (roxadustat) in Europe commercialized by Astellas Pharma Inc., or Astellas , Eporatio (epoetin theta) in Europe commercialized by Teva Pharmaceuticals Ltd., Silapo (epoetin zeta) in Europe commercialized by Stada Arzneimittel AG, Epoetin Alfa Hexal (epoetin alfa) in Europe commercialized by Hexal AG, Binocrit (epoetin alfa-biosimilar) in Europe commercialized by Sandoz, and NeoRecormon (epoetin beta) in Europe commercialized by Roche.
• Auryxia is competing in the hyperphosphatemia market in the U.S. with other FDA-approved phosphate binders such as Renagel (sevelamer hydrochloride) and Renvela (sevelamer carbonate), both marketed by Sanofi, PhosLo and Phoslyra (calcium acetate), marketed by Fresenius Medical Care North America, Fosrenol (lanthanum carbonate), marketed by Shire Pharmaceuticals Group plc, and Velphoro (sucroferric oxyhydroxide), marketed by Fresenius Medical Care North America, as well as over-the-counter calcium carbonate products such as TUMS and metal-based options such as aluminum, lanthanum and magnesium.
• Auryxia is competing in the IDA market in the U.S. with over-the-counter oral iron, ferrous sulfate, other prescription oral iron formulations, including ferrous gluconate, ferrous fumerate, and polysaccharide iron complex, and intravenous iron formulations, including Feraheme (ferumoxytol injection), Venofer (iron sucrose injection), Ferrlicit (sodium ferric gluconate complex in sucrose injection), Injectafer (ferric carboxymaltose injection), and Triferic (ferric pyrophosphate citrate).

Legal Proceedings

• In July 2024, Ardelyx filed a complaint in the United States District Court for the District of Columbia against HHS, CMS and other parties, which alleged that CMSs plan to include oral-only phosphate lowering therapies in the ESRD PPS violated its statutory and regulatory authority under the Medicare Improvements for Patients and Providers Act, which established the ESRD PPS bundled payment system for dialysis services.
• In October 2024, Ardelyx filed a motion for a preliminary injunction to enjoin CMS from including oral-only phosphate lowering therapies in the ESRD PPS.
• CMS had earlier filed a motion to dismiss the complaint on jurisdictional grounds.
• On November 8, 2024, the district court denied Ardelyx motion for a preliminary injunction and it granted the governments motion to dismiss.
• Thereafter, Ardelyx moved for reconsideration, but the district court also denied that request.
• On December 26, 2024, Ardelyx filed a notice of appeal with the US Court of Appeals for the DC Circuit.

Stakeholder Impact

• Shareholders face potential dilution from future equity offerings.
• Employees may experience uncertainty due to potential workforce adjustments.
• Patients may benefit from new therapies and expanded access to treatments.
• Suppliers and creditors may be affected by the company's financial performance and ability to meet obligations.

Next Steps

• Continue commercialization activities for Auryxia and Vafseo.
• Pursue regulatory approval for label expansion for Vafseo.
• Conduct and enroll patients in clinical trials.
• Maintain marketing approvals for Auryxia and Vafseo.
• Manufacture Auryxia and Vafseo for commercial sale and clinical trials.
• Conduct discovery and development activities for additional product candidates.
• Engage in strategic transactions to expand the portfolio.
• Repay the term loans under the BlackRock Credit Agreement.
• Maintain, protect and expand the intellectual property portfolio.

Key Dates