Ardelyx, Inc. 2026 Q2 Earnings Call

Good afternoon, everyone, and welcome to our second quarter 2026 financial results and business update call. Earlier today, we issued our earnings release, which can be found on the investor section of our website at ardelyx.com. Slides that accompany today's call will also be found on our website. On today's call, I am joined by Mike Raab, President and CEO of Ardelyx, Eric Foster, Chief Commercial Officer, and Sue Hohenleitner, our Chief Financial Officer. Before we begin, I'd like to remind you that some of the statements made during the call today and forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995.

These statements involve a number of risks and uncertainties that may cause our actual results to differ materially from those expressed or implied, including those described in our annual report on Form 10-K, our quarterly report on Form 10-Q, which was filed today, and from time to time in other documents filed with the SEC. These forward-looking statements speak only as of today's date, while we may elect to update these forward-looking statements in the future, we specifically disclaim any obligation to do so, even if our views change. I will now pass the call over to Mike.

Thank you, Lisa. Good afternoon, everyone, and thank you for joining us today. This afternoon, we issued a press release announcing our Q2 financial results and a revision to our guidance. I'd like to share my perspectives on our release, drivers of those results, and how we're positioning the business for future growth before I turn the call over to Eric and Sue to cover the performance in detail. In Q2, IBSRELA and XPHOZAH generated a combined revenue of $118 million, up 31% year-over-year, the largest quarterly revenue in our company's history. This is a meaningful milestone, it is important to acknowledge. Growth in the second quarter was robust, yet performance fell short of our expectations. To be clear, IBSRELA demand is strong, physician confidence remains, our view of the long-term opportunity has not wavered, including achieving a billion dollars in revenue.

As we anticipated with the establishment of the IBSRELA Pharmacy Network, our investment in the field reimbursement team, and with IBSRELA's continued success, payers have implemented significant hurdles that impacted new patient starts and access to IBSRELA. Eric will provide further details in his commentary. The fundamentals of the IBSRELA business remain strong, and by staying focused on execution, improving patient access, and partnering closely with providers, we are positioned to drive continued adoption and create meaningful value for both patients and shareholders. Now, on XPHOZAH. The team had an excellent quarter. Growth continues to be driven by patient need, physician adoption, and a differentiated clinical profile. As you know, on June 26th, the D.C. Circuit Court of Appeals affirmed the district court's dismissal of our lawsuit against CMS. As a result, oral phosphate-lowering drugs remain in the bundle.

With this decision, we have determined that we will no longer pursue further litigation on this matter. While our strategy remains, we recognize the market dynamics ahead of us present challenges to navigate. As we have always done, we remain committed to ensuring patients in need have access to XPHOZAH. Now taking a step back. We operate in a complex business with significant external pressures and with new ones that emerge almost daily. Even so, we are in an enviable position. We have two first-in-class commercial products, both differentiated, growing quarter-over-quarter and year-over-year. Our strengthening balance sheet is driven by top-line growth, disciplined expense management, and a thoughtful capital allocation strategy. We have built a solid foundation, are investing in our future by advancing tenapanor and our next-generation NHE3 inhibitor, and we are continuing business development activities to further expand our pipeline.

We are building a robust patent estate for tenapanor, anchored by multiple Orange Book-listed patents, including our 299 patent. We are a well-funded, self-sustaining, high-growth company on the path to sustained profitability in 2027 and beyond. Our enthusiasm and belief in our business, our competitive position, our strategy, and the long-term value we are creating has not changed. With that, I'll turn the call over to Eric.

Eric. Thank you, Mike. IBSRELA revenue grew 33% year-over-year.

As Mike noted, we experienced significant payer hurdles that had a direct impact on access to IBSRELA. While new patient starts have been slowed by these hurdles, we continue to see strong growth in refills and total prescriptions, reaching our highest demand quarter to date. We understand the ongoing market dynamics IBSRELA is facing and are confident that the following four actions will position IBSRELA for future growth by addressing increasing payer hurdles and accelerating IBSRELA demand. One. Leveraging our dedicated field reimbursement team, which we doubled in size in the first half of this year and who have all been in the field as of July 1st to help navigate HCPs' cumbersome paperwork and burdensome step edits.

Two, reinforcing our continued efforts to drive more prescriptions through the IBSRELA Pharmacy Network, or IPN, to increase fulfillment rates and improve adherence. We deployed additional resources along with our FRMs and sales force to provide patient-focused, high-touch support that improves the patient experience. Our data shows that when a prescription goes through the IPN, it results in higher fulfillment rates, faster fills, and in one additional refill per patient on an annual basis. Three, increasing the frequency of engagement with our target HCPs is one of the most important drivers of demand. In Q2, we implemented initiatives to expand our sales organization to 144 representatives to increase the frequency of engagement with our targeted high-writing HCPs. With this expanded sales force, along with our FRMs, we expect to see continued direct and measurable impact, and while early, we are encouraged by the results.

Four, we are expanding our patient awareness and engagement initiatives. Alongside our partnership with the LPGA and ongoing omni-channel and digital efforts, we are initiating new direct-to-consumer activities during the second half of the year. Our consumer-facing messaging is expected to increase brand awareness among our targeted patient population, leading to important conversations with healthcare providers, which our experience tells us leads to an IBSRELA prescription. The unmet need remains high for IBS-C patients and highlights the important role IBSRELA plays for patients seeking treatment options. Last year, nearly seven million prescriptions were written for IBS-C-indicated drugs, reflecting both the large number of patients seeking relief despite existing therapies and the significant patient burden that still exists. Although multiple treatment options are available, our internal research indicates that as many as 77% of patients on a secretagogue continue to experience persistent symptoms.

The patient need is demonstrated by record highs in Q2 demand, total writers, total prescriptions per writer, and market share since launch, and further supports our conviction in IBSRELA reaching $1 billion in revenue. As we continue to work to execute on the four initiatives I just outlined, I am confident that these efforts will address the barriers identified, accelerate adoption, and enable more patients to receive the treatment they need. Moving on to XPHOZAH. We are impressed by the resilience of XPHOZAH as we saw strong momentum in Q2. With more than 550,000 adult patients with CKD on dialysis in the U.S., approximately 80% are treated with phosphate-lowering therapies in an effort to achieve and maintain target phosphorus levels. As the number of patients treated with XPHOZAH grows, our conviction in its value is reinforced. Our priority remains clear, ensuring XPHOZAH is available to patients who need it.

In Q2, XPHOZAH generated 27% revenue growth year-over-year. We saw solid growth across key metrics, with notable increases in total dispenses of 33% and in paid prescriptions of 25% compared to the same quarter in 2025. In addition, XPHOZAH reached its highest total writers and prescriptions per writer since Q1 2025. While we are encouraged by XPHOZAH's performance, we continue to recognize and assess the challenges ahead of us. Our focus remains on enhancing the effectiveness of our commercial approach by refining sales force deployment and strengthening engagement with healthcare providers and dialysis organizations. These initiatives are designed to ensure we're reaching the physicians treating the patients most likely to benefit from XPHOZAH while continuing to build awareness across the nephrology community.

I'm confident in the team's ability to drive demand for both medicines by overcoming the access challenges for IBSRELA and maintaining disciplined execution with XPHOZAH in the second half of this year. Patients need our differentiated products, as indicated by the growing demand for both IBSRELA and XPHOZAH, and helping more patients with our medicine is our top priority. I will now turn it over to Sue.