Intercept Pharmaceuticals, Inc.

Ocaliva net sales were $83.7 million in Q2 2023, compared with $71.8 million in Q2 2022, a 17% increase. SG&A was $53.3 million versus $40 million a year ago, and interest expense was $2.8 million versus $6.7 million last year. Net loss from continuing operations was $5.8 million, compared with a net loss of $20.3 million in Q2 2022. As of June 30, 2023, cash, cash equivalents, restricted cash and investment securities available for sale totaled $415 million, and the company said it was net cash positive by about $80 million. The 2023 convertible notes matured on July 1 and were repaid in cash for the full principal amount of $109.8 million. For 2023, management now expects Ocaliva net sales of $320 million-$340 million and non-GAAP adjusted operating expenses of $350 million-$370 million, and it expects meaningful profitability in 2024.

Jerry Durso framed the quarter as validation of both the Ocaliva franchise and the restructuring plan. He emphasized double-digit sales growth, the decision to halt all NASH-related investment, and the goal of creating a lower-cost company focused on rare and serious liver disease. His tone was confident and forward-looking, repeatedly pointing to profitability in 2024 and the long-term strategic value of the PBC business and the combination program.

Andrew Saik focused on execution of the cost reset and the financial bridge to profitability. He said the company expects the REGENERATE study closeout to be substantially complete by year-end, with some final spend into Q1 2024, and that the restructuring should deliver about $140 million of annual non-GAAP adjusted operating expense reduction versus the updated 2023 guidance. He also highlighted the balance sheet, citing $415 million of cash, cash equivalents, restricted cash and investment securities available for sale at June 30, plus the $109.8 million cash repayment of the convertible notes at maturity.

Analysts pressed on how the OCA-bezafibrate program could move through the FDA, including whether Phase 3 could be expedited, whether the trial could be first-line, and what the control arm might be. Management said they have a proposed Phase 3 design, have started site identification, expect enrollment in 2024, and are discussing endpoints and design with the FDA, while acknowledging an AdCom could be possible and that placebo may still be required in some form under accelerated approval. Questions also focused on pruritus measurement, patient persistency, and the use of real-world data; management said it is using VAS-based pruritus assessments, highlighted about 50% two-year persistence and high satisfaction, and argued that replicated real-world datasets, physician/patient advocacy, and evolving standards of care support their regulatory case.