Travere Therapeutics Inc.
10/30/2025 | Press release | Distributed by Public on 10/30/2025 14:47
Quarterly Report for Quarter Ending September 30, 2025 (Form 10-Q)
Management's Discussion and Analysis of Financial Condition and Results of Operations
The following discussion and analysis of our financial condition and results of operations should be read in conjunction with our unaudited consolidated financial statements and related notes included in this Quarterly Report on Form 10-Q and the audited financial statements and notes thereto as of and for the year ended December 31, 2024 and the related Management's Discussion and Analysis of Financial Condition and Results of Operations, both of which are contained in our Annual Report on Form 10-K for the year ended December 31, 2024, filed with the Securities and Exchange Commission (SEC) on February 21, 2025. Past operating results are not necessarily indicative of results that may occur in future periods. In addition, see the discussion under the heading "Forward-Looking Statements" immediately preceding the consolidated financial statements included under Part I of this Quarterly Report on Form 10-Q.
Overview
We are a biopharmaceutical company headquartered in San Diego, California, focused on identifying, developing and delivering life-changing therapies to people living with rare kidney and metabolic diseases. Our approach centers on advancing our innovative pipeline with multiple late-stage clinical programs targeting rare diseases with significant unmet medical needs. Upon approval of any of our late-stage programs, we intend to leverage the skills of our talented commercial organization which has successfully identified, supported and treated patients prescribed our approved products for over ten years.
Our Pipeline and Approved Products
We have a diversified pipeline designed to address areas of high unmet need in rare kidney and metabolic diseases. We invest revenues from our commercial portfolio into our pipeline with the goal of delivering new treatments for diseases with limited or no approved therapies.
The following table summarizes the status of our clinical programs, preclinical programs and approved products, each of which is described in further detail below.
| 1 |
On September 5, 2024, the FDA granted full approval of FILSPARI® (sparsentan) to slow kidney function decline in adults with primary IgAN who are at risk of disease progression. FILSPARI had previously been granted accelerated approval in February 2023.
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| 2 | In May 2025, we announced that the FDA accepted our sNDA for traditional approval of FILSPARI for the treatment of FSGS and assigned a PDUFA target action date of January 13, 2026. | ||||
| 3 | In September 2024, we voluntarily paused enrollment in the Phase 3 HARMONY Study, as described below. | ||||
FILSPARI® (sparsentan)
On September 5, 2024, the FDA granted full approval of FILSPARI® (sparsentan) to slow kidney function decline in adults with primary Immunoglobulin A nephropathy (IgAN) who are at risk of disease progression. FILSPARI had previously been granted accelerated approval in February 2023 based on the surrogate marker of proteinuria. Full approval was based on positive long-term confirmatory results from the PROTECT Study demonstrating that FILSPARI significantly slowed kidney function decline over two years compared to irbesartan.
FILSPARI is the only oral, once-daily, non-immunosuppressive medication that directly targets glomerular injury in the kidney by blocking two critical pathways of IgAN disease progression (endothelin-1 and angiotensin II).
The two-year efficacy data contained in the FDA-approved label is a modified intention to treat (ITT) analysis and evaluates data from all patients regardless of treatment discontinuation. In the final analysis of the 404 randomized patients, FILSPARI significantly reduced the rate of decline in kidney function from baseline to Week 110 compared to irbesartan. In the ITT analysis included in the label, the mean eGFR slope from baseline to Week 110 was -3.0 mL/min/1.73 m2/year for FILSPARI and -4.2 mL/min/1.73 m2/year for irbesartan, corresponding to a statistically significant treatment effect of 1.2 mL/ min/1.73 m2/year (p=0.0168). The positive treatment effects on proteinuria compared to the active control irbesartan that were observed at Week 36 were durable out to the two-year measurement period. Additional results from the PROTECT Study demonstrated the benefit of FILSPARI on absolute eGFR accrued over time and by Week 110 resulted in a 3.8 mL/min/1.73 m2difference in the mean change from baseline between FILSPARI and irbesartan.
Results from the PROTECT Study showed that FILSPARI was well tolerated with a clearly defined safety profile that has been consistent across all clinical trials conducted to date.
FILSPARI is a dual endothelin angiotensin receptor antagonist (DEARA). Pre-clinical data have shown that blockade of both endothelin type A and angiotensin II type 1 pathways in forms of rare chronic kidney disease, reduces proteinuria, protects podocytes and prevents glomerulosclerosis and mesangial cell proliferation. FILSPARI has been granted seven years of Orphan Drug Exclusivity in the U.S. (running from the date of accelerated approval) for the reduction of proteinuria in adults with primary IgAN at risk of rapid disease progression, and has been granted a separate seven years of Orphan Drug Exclusivity in the U.S. (running from the date of full approval) to slow kidney function decline in adults with primary IgAN who are at risk for disease progression, excluding the use provided for in the aforementioned Orphan Drug Exclusivity granted in connection with the accelerated approval.
IgAN is characterized by hematuria, proteinuria, and variable rates of progressive renal failure. With an estimated prevalence of up to 150,000 people in the United States and greater numbers in Europe and Asia, IgAN is the most common primary glomerular disease. Most patients are diagnosed between the ages of 16 and 35, with up to 40% progressing to kidney failure within 15 years. FILSPARI is the first non-immunosuppressive therapy approved for IgAN and is the only oral, once-daily, non-immunosuppressive therapy approved for this condition that directly targets glomerular injury in the kidney by blocking two critical pathways of IgAN disease progression (endothelin-1 and angiotensin II). We estimate more than 70,000 patients in the United States to be addressable under FILSPARI's full approval indication.
Data to support the approval of FILSPARI was generated from the Phase 3 PROTECT Study, the largest head-to-head interventional study to date in IgAN. It is a global, randomized, multicenter, double-blind, parallel-arm, active-controlled clinical trial that evaluated the safety and efficacy of 400mg of sparsentan, compared to 300mg of irbesartan, in 404 patients ages 18 years and up with IgAN and persistent proteinuria despite available angiotensin converting enzyme (ACE) inhibitor or angiotensin receptor blockers (ARB) therapy, and is currently ongoing in the open label extension phase of the study.
FILSPARI is available only through a risk evaluation and mitigation strategy (REMS) approved by the FDA for liver monitoring regarding potential risk of hepatotoxicity, as has been required for certain other approved endothelin antagonists. Initially, as part of the liver monitoring REMS, monthly monitoring of each patient was required for the first year a patient was on treatment, and quarterly thereafter. In August 2025, the FDA approved updated REMS labeling, reducing the frequency of liver monitoring to every three months from the onset of treatment and also removing the embryo-fetal toxicity monitoring requirement from the REMS.
In April 2024, we and our partner CSL Vifor announced that the European Commission had granted conditional marketing authorization ("CMA") for FILSPARI (sparsentan) for the treatment of adults with primary IgAN with a urine protein excretion ≥1.0 g/day (or urine protein-to-creatinine ratio ≥0.75 g/g), and in April 2025, we and CSL Vifor announced that the European Commission has converted the CMA into a standard marketing authorization ("MA") for FILSPARI for the treatment of adults with primary IgAN with a urine protein excretion ≥1.0 g/day (or urine protein-to-creatinine ratio ≥0.75 g/g). The MA is granted for all member states of the European Union, as well as in Iceland, Liechtenstein and Norway. As a result of the standard MA approval, we received a regulatory milestone payment of $17.5 million in May 2025 under the terms of the License Agreement. Additionally, in September 2025, we recognized a $40 million milestone for market access initiatives in certain countries; payment of the milestone was received in the fourth quarter of 2025. FILSPARI became commercially available in Europe under the CMA in August 2024, with an initial launch in Germany and Austria. In October 2024, we and CSL Vifor announced that Swissmedic has granted temporary marketing authorization for FILSPARI for the treatment of adults with primary IgAN with a urine protein excretion ≥1.0 g/day (or urine protein-to-creatinine ratio ≥0.75 g/g). In April 2025, the Medicines and Healthcare products Regulatory Agency (MHRA) in the UK converted its conditional approval of FILSPARI in IgAN to standard approval.
In January 2024, we announced our entry into an exclusive licensing agreement with Renalys Pharma, Inc. ("Renalys"), to bring sparsentan for the treatment of IgAN to patients in Japan and other countries in Asia. Renalys holds regional rights to sparsentan for Japan, South Korea, Taiwan, Brunei, Cambodia, Indonesia, Laos, Malaysia, Myanmar, the Philippines, Singapore, Thailand, and Vietnam. Following successful meetings with the Pharmaceuticals and Medical Devices Agency (PMDA) in 2023, in the second quarter of 2024 Renalys initiated an open label registration study of sparsentan in Japan to support potential approval of sparsentan in Japan. In July 2024, Renalys announced that the first patient was dosed in the study and in January 2025, Renalys announced achievement of full enrollment in the study. Results from the urine protein/creatinine ratio (UP/C) endpoint in the study are expected in the second half of 2025 to support a submission for approval to PMDA. In December 2024, Renalys announced that sparsentan received Orphan Drug Designation from the Japanese Ministry of Health, Labour and Welfare for the indication of primary IgA nephropathy as of November 27, 2024. In October 2025, Renalys announced that it had completed data collection for the primary endpoint in the Phase 3 clinical trial of sparsentan for IgAN and that it had reached an agreement with the PMDA regarding development plans for two new Phase 3 clinical trials of sparsentan, one investigating the use of sparsentan in focal segmental glomerulosclerosis (FSGS) and the other in Alport syndrome, in Japan. Under the terms of the licensing agreement, Renalys is responsible for development, regulatory matters, and commercialization in the licensed territories. Also in October 2025, Renalys announced that it has entered into a definitive stock purchase agreement with Chugai Pharmaceutical Co., Ltd. ("Chugai") pursuant to which, upon the closing of the transaction, Chugai will acquire full ownership of Renalys and will gain exclusive rights to develop and commercialize sparsentan in Japan, South Korea, and Taiwan. As a minority shareholder in Renalys, Travere is entitled to receive a portion of the upfront payment at the closing of the transaction, and will be eligible to receive future payments upon the achievement of specified regulatory milestones for sparsentan and royalties on net sales in Japan, South Korea, and Taiwan.
Clinical-Stage Programs:
Sparsentan for the treatment of FSGS
Sparsentan has been granted Orphan Drug Designation for the treatment of FSGS in the U.S. and the EEA.
FSGS is a leading cause of kidney failure and nephrotic syndrome. There are currently no FDA-approved pharmacologic treatments for FSGS and there remains a high unmet need for patients living with FSGS as off-label treatments such as ACE/ARBs, steroids, and immunosuppressant agents are effective in only a subset of patients and use of some of these off-label treatments may be further inhibited by their safety profiles. Every year approximately 5,400 patients are diagnosed with FSGS and we estimate that there are more than 40,000 FSGS patients in the United States and a similar number in Europe with approximately half of them being candidates for sparsentan.
In 2016, we generated positive data from our Phase 2 DUET study in FSGS. In 2018, we announced the initiation of the Phase 3 clinical trial designed to serve as the basis for an NDA and MAA filing for sparsentan for the treatment of FSGS (the "DUPLEX Study"). The DUPLEX Study is a global, randomized, multicenter, double-blind, parallel-arm, active-controlled clinical trial evaluating the safety and efficacy of sparsentan in 371 patients. The DUPLEX Study protocol provided for an unblinded analysis of at least 190 patients to be performed after 36 weeks of treatment to evaluate the interim efficacy endpoint - the proportion of patients achieving a FSGS partial remission of proteinuria endpoint (FPRE), which is defined as urine protein-to-creatinine ratio (UPCR) ≤1.5 g/g and a >40% reduction in UPCR from baseline, at week 36. In February 2021, we announced that the ongoing Phase 3 DUPLEX Study achieved its pre-specified interim FSGS partial remission of proteinuria endpoint following the 36-week interim period. After 36 weeks of treatment, 42.0 percent of patients receiving sparsentan achieved FPRE, compared to 26.0 percent of irbesartan-treated patients (p=0.0094). Following engagement with the FDA on the interim proteinuria analysis and a subsequent eGFR data-cut, we elected to forego the previously planned submission for accelerated approval and pursue a potential traditional approval upon completion of the DUPLEX Study.
In May 2023, we announced topline primary efficacy results from the pivotal Phase 3 DUPLEX Study of sparsentan in FSGS. The confirmatory primary endpoint of the DUPLEX Study designed to support traditional regulatory approval was the rate of change in eGFR over 108 weeks of treatment. At the end of the 108-week double-blind period, sparsentan was observed to have a 0.3 mL/min/1.73m2per year (95% CI: -1.74, 2.41) favorable difference on eGFR total slope and a 0.9 mL/min/1.73m2 per year (95% CI: -1.27, 3.04) favorable difference on eGFR chronic slope compared to the active control irbesartan, which was not statistically significant. After 108 weeks of treatment, sparsentan achieved a mean reduction in proteinuria from baseline of 50%, compared to 32% for irbesartan. Although the DUPLEX Study did not achieve its two-year primary endpoint with statistical significance over the active control irbesartan, we are encouraged by the results, including the pre-specified secondary endpoints on proteinuria and exploratory endpoints, including renal outcomes, which trended favorably for sparsentan. In addition, a review of the safety results through 108 weeks of treatment indicate sparsentan was generally well-tolerated and the overall safety profile in the study to date was generally consistent between treatment groups.
In December 2023, we announced that we had completed a planned Type C meeting with the FDA to discuss results from the Phase 3 DUPLEX Study of sparsentan in FSGS. The FDA acknowledged the high unmet need for approved therapies as well as the challenges in studying FSGS but indicated that the two-year results from the Phase 3 DUPLEX Study alone were not sufficient to support an sNDA submission. The FDA acknowledged the work being done by the larger nephrology community to better understand proteinuria and eGFR as endpoints in clinical trials of FSGS and indicated a willingness to continue to engage with us on a potential path forward for sparsentan in FSGS following our consideration of additional evidence. Subsequently, a collaborative international effort referred to as the PARASOL project was initiated with a goal to define the quantitative relationships between short-term changes in biomarkers (proteinuria and GFR) and long-term outcomes in order to support the use of alternative proteinuria-based endpoints as a basis for accelerated and traditional approval. The PARASOL project is led by several patient advocacy organizations focused on glomerular diseases, with participation from regulators and industry representatives. The principal finding from PARASOL was that in FSGS, reduction in proteinuria over 24 months is strongly associated with a reduction in the risk of kidney failure, and responder definitions based on thresholds of proteinuria are both biologically plausible and strongly supported by epidemiological data. Following the PARASOL public workshop in the fourth quarter of 2024, in which a multi-stakeholder group of rare kidney disease experts aligned around a potential proteinuria-based clinical trial endpoint for FSGS, we scheduled a Type C meeting with the FDA to discuss a potential regulatory pathway for a sparsentan FSGS indication. In February 2025, we announced that we had completed a Type C meeting with the FDA and in March 2025, we announced that we had submitted an sNDA to the FDA seeking traditional approval of FILSPARI for the treatment of FSGS. In May 2025, we announced that the FDA accepted the sNDA, assigned a Prescription Drug User Fee Act ("PDUFA") target action date of January 13, 2026, and initially indicated that it planned to hold an advisory committee meeting to discuss the application. In September 2025, following further review of the sNDA, the FDA informed us that an advisory committee meeting is no longer needed. The sNDA remains under review by the FDA with a PDUFA target action date of January 13, 2026.
The sNDA is supported by two of the largest and most rigorous head-to-head interventional studies conducted to date in FSGS, the Phase 3 DUPLEX Study and the Phase 2 DUET Study. In these studies, FILSPARI demonstrated rapid, superior and sustained reductions in proteinuria when compared with maximum labeled dose irbesartan across adult and pediatric patients. As published in the New England Journal of Medicine, DUPLEX showed statistically significant and clinically meaningful proteinuria remission at 36 weeks that was durable through 2 years. Patients who achieved partial or complete proteinuria remission in the DUPLEX Study, irrespective of the treatment arm, had a 67% to 77% lower risk of kidney failure, respectively, with the treatment effect of FILSPARI strengthened at more stringent thresholds down to complete remission. The results from these studies are in alignment with the findings of the independent PARASOL workgroup that support the importance of proteinuria in FSGS. If approved, FILSPARI could become the first and only FDA-approved medicine indicated for FSGS.
Together with CSL Vifor and Renalys, we continue to evaluate the potential for a regulatory pathway forward for sparsentan in FSGS in Europe and Asia.
Under the terms of our exclusive license to CSL Vifor, CSL Vifor is responsible for all commercialization activities in its licensed territories. We remain responsible for the clinical development of sparsentan in the applicable territories. If sparsentan receives marketing authorization in any of the territories covered by the exclusive license to Renalys, Renalys will be responsible for all development, regulatory matters, and commercialization activities in such licensed territories. We will retain all rights to sparsentan in the United States and rest of world outside of the territories licensed to CSL Vifor and Renalys, provided that CSL Vifor has a right of negotiation to expand the licensed territories into Canada and/or Mexico.
Pegtibatinase
Pegtibatinase is a novel investigational human enzyme replacement candidate being evaluated for the treatment of classical homocystinuria (HCU). Classical HCU is a rare metabolic disorder characterized by elevated levels of plasma homocysteine that can lead to vision, skeletal, circulatory and central nervous system complications. We estimate that there are approximately 7,000 to 10,000 addressable HCU patients globally. Pegtibatinase has been granted Rare Pediatric Disease, Fast Track and Breakthrough Therapy designations by the FDA, as well as orphan drug designation in the United States and European Union.
In December 2021, we announced positive topline results from the Phase 1/2 COMPOSE Study, a double blind, randomized, placebo-controlled dose escalation study to assess its safety, tolerability, pharmacokinetics, pharmacodynamics and clinical effects in patients with classical HCU. Pegtibatinase demonstrated dose-dependent reductions in total homocysteine (tHcy) during the 12 weeks of treatment, and in the highest dose cohort to date evaluating 1.5 mg/kg of pegtibatinase twice weekly (BIW), treatment with pegtibatinase resulted in rapid and sustained reductions in total homocysteine (tHcy) through
12 weeks of treatment, including a 55.1% mean relative reduction in tHcy from baseline as well as maintenance of tHcy below a clinically meaningful threshold of 100 μmol. Additionally, in a dose-dependent manner in the study to date, methionine levels were substantially reduced and cystathionine levels were substantially elevated following treatment with pegtibatinase, suggesting that pegtibatinase acts in a manner similar to the native CBS enzyme.
In May 2023, we announced positive topline results from the sixth cohort of the Phase 1/2 COMPOSE Study, which was initiated to inform and refine formulation work for future development and commercial purposes and to further evaluate the dose response curve for pegtibatinase, and to further inform our pivotal development program to ultimately support potential approval of pegtibatinase for the treatment of HCU. In this cohort, five patients were randomized in a blinded fashion to receive 2.5 mg/kg of lyophilized pegtibatinase or placebo twice weekly (BIW), with four patients assigned to the treatment group. In this highest dose cohort to date, treatment with pegtibatinase resulted in rapid and sustained reductions in total homocysteine (tHcy), with a 67.1% mean relative reduction in tHcy from baseline, as well as maintenance of mean tHcy below the clinically meaningful threshold of 100 μmol, over weeks 6 to 12. In the double-blind period, pegtibatinase was generally well-tolerated, with no discontinuations due to treatment-related adverse events.
In December 2023, we initiated the pivotal Phase 3 HARMONY Study to support the potential approval of pegtibatinase for the treatment of classical HCU. The HARMONY Study is a global, randomized, multi-center, double-blind, placebo-controlled Phase 3 clinical trial designed to evaluate the efficacy and safety of pegtibatinase as a novel treatment to reduce total homocysteine (tHcy) levels. In the beginning of 2024, the first patients were dosed in the HARMONY Study.
In September 2024, we announced a voluntary pause of enrollment in the Phase 3 HARMONY Study. The voluntary enrollment pause enables us to work to address necessary process improvements in manufacturing scale-up to support commercial scale manufacturing as well as full enrollment in the HARMONY Study. Patients currently enrolled in pegtibatinase studies continue to receive study medication from small scale batches which are unaffected by the scale-up process. Currently enrolled patients will be able to continue on study medication as scheduled for the duration of the trials they are participating in. The voluntary enrollment pause was enacted following our determination that the desired drug substance profile was not achieved in the initial scale-up process. We have successfully manufactured the first commercial-scale batches and are engaging with regulators to restart enrollment in the Phase 3 HARMONY Study in 2026.
We acquired pegtibatinase as part of the November 2020 acquisition of Orphan Technologies Limited.
Other Commercial Products:
Thiola and Thiola EC (tiopronin)
Thiola and Thiola EC are approved by the FDA for the treatment of cystinuria, a rare genetic cystine transport disorder that causes high cystine levels in the urine and the formation of recurring kidney stones. Due to the larger stone size, cystine stones may be more difficult to pass, often requiring surgical procedures to remove. More than 80 percent of people with cystinuria develop their first stone by the age of 20. More than 25 percent will develop cystine stones by the age of 10. Recurring stone formation can cause loss of kidney function in addition to substantial pain and loss of productivity associated with renal colic and stone passage. While a portion of people living with the disease are able to manage symptoms through diet and fluid intake, the prevalence of cystinuria in the U.S. is estimated to be 10,000 to 12,000, indicating that there may be as many as 4,000 to 5,000 affected individuals with cystinuria in the U.S. that would be candidates for Thiola or Thiola EC.
In June 2019 we announced that the FDA approved 100mg and 300mg tablets of Thiola EC, an enteric-coated formulation of Thiola, to be used for the treatment of cystinuria. Thiola EC offers the potential for administration with or without food, and the ability to reduce the number of tablets necessary to manage cystinuria. Thiola EC became available to patients in July 2019.
In May 2021, a generic option for the 100mg version of the original formulation of Thiola (tiopronin tablets) became available and in June 2022, a second option for the 100mg version of the original formulation of Thiola (tiopronin tablets) was approved. These generic versions of the original formulation of Thiola have impacted our sales, and these or additional generic versions of either formulation could have a material adverse impact on sales. To date, several generic options for the 100mg and 300mg versions of Thiola EC have been approved by the FDA and become available. Accordingly, Thiola EC is subject to generic competition.
Results of Operations
Results of operations for the three and nine months ended September 30, 2025 compared to the three and nine months ended September 30, 2024
Revenue
The following table provides information regarding revenue (in thousands):
| Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||||||||||||||
| 2025 | 2024 | Change | 2025 | 2024 | Change | ||||||||||||||||||||||||||||||
| FILSPARI | $ | 90,900 | $ | 35,619 | $ | 55,281 | $ | 218,668 | $ | 82,578 | $ | 136,090 | |||||||||||||||||||||||
| Tiopronin products | 22,250 | 25,382 | (3,132) | 65,184 | 70,583 | (5,399) | |||||||||||||||||||||||||||||
| Total net product sales | 113,150 | 61,001 | 52,149 | 283,852 | 153,161 | 130,691 | |||||||||||||||||||||||||||||
| License and collaboration revenue | 51,709 | 1,897 | 49,812 | 77,187 | 5,227 | 71,960 | |||||||||||||||||||||||||||||
| Total revenue | $ | 164,859 | $ | 62,898 | $ | 101,961 | $ | 361,039 | $ | 158,388 | $ | 202,651 | |||||||||||||||||||||||
Net product sales
The increase in total net product sales for the three and nine months ended September 30, 2025 compared to the three and nine months ended September 30, 2024 was primarily due to growth in sales of FILSPARI.
License and collaboration revenue
The increase in license and collaboration revenue for the three months ended September 30, 2025 compared to the three months ended September 30, 2024 was primarily due to a market access milestone of $40.0 million associated with the CSL Vifor License agreement and license revenue of $9.3 million recognized upon the relinquishment of the Buyout Right in the Renalys License Agreement. The increase in license and collaboration revenue for the nine months ended September 30, 2025 compared to the nine months ended September 30, 2024 was primarily due to market access and regulatory milestones totaling $57.5 million associated with the CSL Vifor License agreement, license revenue of $9.3 million associated with the relinquishment of the Buyout Right in the Renalys License Agreement and the sale of $3.8 million active pharmaceutical ingredients to CSL Vifor in March of 2025.
Operating Expenses
The following table provides information regarding operating expenses (in thousands):
| Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||||||||||||||
| 2025 | 2024 | Change | 2025 | 2024 | Change | ||||||||||||||||||||||||||||||
| Cost of goods sold - product sales | $ | 1,308 | $ | 1,626 | $ | (318) | $ | 4,083 | $ | 5,059 | $ | (976) | |||||||||||||||||||||||
| Cost of goods sold - license and collaboration | 277 | - | 277 | 3,703 | 132 | 3,571 | |||||||||||||||||||||||||||||
| Total cost of goods sold | 1,585 | 1,626 | (41) | 7,786 | 5,191 | 2,595 | |||||||||||||||||||||||||||||
| Research and development | 51,890 | 51,679 | 211 | 148,141 | 155,429 | (7,288) | |||||||||||||||||||||||||||||
| Selling, general and administrative | 86,453 | 65,619 | 20,834 | 235,508 | 194,618 | 40,890 | |||||||||||||||||||||||||||||
| In-process research and development | - | - | - | - | 65,205 | (65,205) | |||||||||||||||||||||||||||||
| Restructuring | - | 123 | (123) | - | 1,035 | (1,035) | |||||||||||||||||||||||||||||
| Total operating expenses | $ | 139,928 | $ | 119,047 | $ | 20,881 | $ | 391,435 | $ | 421,478 | $ | (30,043) | |||||||||||||||||||||||
Cost of goods sold
Cost of goods sold includes the cost of inventory sold, third party manufacturing and supply chain costs, product shipping and handling costs, and provisions for excess and obsolete inventory. Cost of goods sold also includes the cost of goods sold under our license and collaboration agreements, which currently consists of the sale of active pharmaceutical ingredients to our collaboration partners, at cost or at cost plus a margin.
Prior to the February 2023 FDA accelerated approval of FILSPARI (sparsentan), we expensed the production of active pharmaceutical ingredients purchased to support the commercial launch of FILSPARI, in research and development expenses. For the three and nine months ended September 30, 2025 and 2024, sales of FILSPARI primarily consisted of zero-cost inventories, and therefore cost of goods sold did not increase proportionally to the increase in product sales. As of September 30, 2025, we had $0.9 million of zero-cost inventory remaining, the majority of which we expect will be consumed in 2025. We began capitalizing inventory costs associated with FILSPARI following the February 2023 accelerated approval.
For the nine months ended September 30, 2025 compared to the nine months ended September 30, 2024, our cost of goods sold - license and collaboration increased by $3.6 million, primarily due to the sale of active pharmaceutical ingredients to CSL Vifor in March 2025.
Research and development expenses
Research and development costs include expenses related to sparsentan, pegtibatinase and our other pipeline programs. We expense all research and development costs as they are incurred. Our research and development costs are comprised of salaries and bonuses, benefits, non-cash share-based compensation, license fees, milestones under license agreements, costs paid to third-party contractors to perform research, conduct clinical trials, and develop drug materials and delivery methods, manufacture drug product supplies to support clinical development, and associated overhead expenses and facilities costs. We charge direct internal and external program costs to the respective development programs. We also incur indirect costs that are not allocated to specific programs because such costs benefit multiple development programs and allow us to increase our pharmaceutical development capabilities. These consist of internal shared resources related to the development and maintenance of systems and processes applicable to all of our programs.
We currently have four Phase 3 clinical trials in process that are in various stages of activity, with ongoing non-clinical support trials. As such, clinical trial expenses will vary depending on all the factors set forth above and may fluctuate significantly from quarter to quarter and year to year.
We routinely engage vendors and service providers for scientific research, clinical trial, regulatory compliance, manufacturing and other consulting services. We also make grants to research and non-profit organizations to conduct research which may lead to new intellectual properties that we may subsequently license under separately negotiated license agreements. Such grants may be funded in lump sums or installments.
The following table provides information regarding research and development expenses (in thousands):
| Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||||||||||||||
| 2025 | 2024 | Change | 2025 | 2024 | Change | ||||||||||||||||||||||||||||||
| External service provider costs: | |||||||||||||||||||||||||||||||||||
| Sparsentan | $ | 11,608 | $ | 14,525 | $ | (2,917) | $ | 36,664 | $ | 44,204 | $ | (7,540) | |||||||||||||||||||||||
| Pegtibatinase | 16,158 | 16,789 | (631) | 40,477 | 44,331 | (3,854) | |||||||||||||||||||||||||||||
| General and other product candidates | 5,165 | 3,582 | 1,583 | 13,724 | 12,416 | 1,308 | |||||||||||||||||||||||||||||
| Total external service provider costs | 32,931 | 34,896 | (1,965) | 90,865 | 100,951 | (10,086) | |||||||||||||||||||||||||||||
| Internal personnel costs | 18,959 | 16,783 | 2,176 | 57,276 | 54,478 | 2,798 | |||||||||||||||||||||||||||||
| Total research and development | $ | 51,890 | $ | 51,679 | $ | 211 | $ | 148,141 | $ | 155,429 | $ | (7,288) | |||||||||||||||||||||||
For the three and nine months ended September 30, 2025 compared to the three and nine months ended September 30, 2024, our research and development expenses increased by $0.2 million and decreased by $7.3 million, respectively. External service provider costs decreased by $2.0 million and $10.1 million for the three and nine months ended September 30, 2025 compared to the three and nine months ended September 30, 2024, respectively, largely driven by a decrease in costs associated with the development of sparsentan as our Phase 3 programs advance towards completion and a decrease in costs associated with the development of pegtibatinase due to the pause of the HARMONY Study in September 2024. The increase in internal personnel costs of $2.2 million and $2.8 million for the three and nine months ended September 30, 2025 compared to the three and nine months ended September 30, 2024, respectively, is due to an increase in headcount.
Selling, general and administrative expenses
Selling, general and administrative expenses consist of salaries and bonuses, benefits, non-cash share-based compensation, legal and other professional fees, rent, depreciation and amortization, travel, insurance, business development, sales and marketing programs, and other operating expenses.
For the three and nine months ended September 30, 2025 compared to the three and nine months ended September 30, 2024, our selling, general and administrative expenses increased by $20.8 million and $40.9 million, respectively, primarily as a result of an increase in intangible asset amortization from capitalized FILSPARI royalties, an increase in commercial investment to support FILSPARI following full approval by the FDA in September 2024 and commercial spend in preparation for the potential launch of FSGS, if approved.
IPR&D expense
We did not recognize any in-process research and development (IPR&D) expense during the three and nine months ended September 30, 2025. In March 2024, we recognized $65.2 million in IPR&D expense upon the achievement of a development milestone associated with our treatment candidate pegtibatinase, which we acquired as part of the November 2020 acquisition of Orphan Technologies Limited.
Other Income/Expenses
The following table provides information regarding other income, net (in thousands):
| Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||||||||||||||
| 2025 | 2024 | Change | 2025 | 2024 | Change | ||||||||||||||||||||||||||||||
| Interest income | $ | 3,047 | $ | 3,570 | $ | (523) | $ | 10,129 | $ | 14,022 | $ | (3,893) | |||||||||||||||||||||||
| Interest expense | (2,751) | (2,777) | 26 | (8,452) | (8,365) | (87) | |||||||||||||||||||||||||||||
|
Other income (expense), net
|
487 | 520 | (33) | 511 | (2,737) | 3,248 | |||||||||||||||||||||||||||||
|
Total other income, net
|
$ | 783 | $ | 1,313 | $ | (530) | $ | 2,188 | $ | 2,920 | $ | (732) | |||||||||||||||||||||||
The change in our total other income, net for the three and nine months ended September 30, 2025 as compared to the three and nine months ended September 30, 2024 is partially attributable to changes in interest income, driven by a decrease in the overall balance of interest-bearing security investments held along with fluctuations in short-term interest rates on those investments. For the nine months ended September 30, 2024, we recognized $3.4 million in other expense in connection with our equity investment in Renalys, for the difference in basis between the carrying value and fair value of our proportionate share of the investee's net assets.
Liquidity and Capital Resources
We have financed our operations through a combination of borrowings, sales of our equity securities, and revenues generated from our commercialized products, along with proceeds from license and collaboration agreements and the divestiture of our bile acid business. We experienced significant growth in recent years in the number of our employees and the scope of our operations. We also expanded our sales and marketing, compliance and legal functions in addition to expansion of all functions to support a commercial organization, including by adding additional members to our sales force in connection with the commercial launch of FILSPARI in the United States for IgAN and for the potential commercial launch of FILSPARI in the United States for FSGS, if approved.
We believe that our available cash and short-term investments as of the date of this filing, together with anticipated cash generated from operations, will be sufficient to fund our anticipated level of operations beyond the next 12 months from the date of this filing. We expect that our operating results will vary from
quarter-to-quarter and year-to-year depending upon various factors including revenues, selling, general and administrative expenses, and research and development expenses, particularly with respect to our clinical and preclinical development activities. Our ability to fund our operations in subsequent years will depend upon certain factors which are beyond our control and may require us to obtain additional debt or equity capital or refinance all or a portion of our debt, including the 2029 Notes, on or before maturity. Though we generate revenues from product sales arrangements, we may incur significant operating losses over the next several years. Our ability to achieve profitable operations in the future will depend in large part upon completing development of products in our pipeline, obtaining regulatory approvals for these products and bringing these products to market, along with potential in-licensing of additional products approved by the FDA and manufacturing and selling these products.
We had the following balances and financial performance at September 30, 2025 and December 31, 2024 (in thousands):
| September 30, 2025 | December 31, 2024 | ||||||||||
| Cash and cash equivalents | $ | 110,930 | $ | 58,535 | |||||||
| Marketable debt securities, at fair value | $ | 143,600 | $ | 312,166 | |||||||
| Convertible debt | $ | 311,370 | $ | 378,988 | |||||||
| Accumulated deficit | $ | (1,475,442) | $ | (1,447,167) | |||||||
|
Stockholders' equity
|
$ | 73,564 | $ | 59,077 | |||||||
| Net working capital* | $ | 236,036 | $ | 215,951 | |||||||
| Net working capital ratio** | 2.75 | 2.08 | |||||||||
|
* Current assets less current liabilities. **Current assets divided by current liabilities. |
|||||||||||
As of September 30, 2025, we had cash and cash equivalents of $110.9 million and available-for-sale marketable debt securities of $143.6 million. Substantial sources of funds over the past year, as summarized further below, include net proceeds of $134.7 million from an underwritten public offering of our common stock in November 2024.
Over the next 12 months, our expected financial obligations include, but are not limited to, funding our operations, operating lease payments, interest payments on our outstanding debt, anticipated milestone payments, royalties on sales of our existing commercialized products, research and development expenses pertaining to clinical and preclinical development activities across our pipeline, expenses associated with the ongoing launch of FILSPARI and expenses associated with the preparations for a potential commercial launch of FILSPARI in FSGS. Sources of cash over this period include net revenues from sales of our products, the sale or maturity of investments in our portfolio of marketable debt securities, FILSPARI royalties and certain earned and potential milestone payments. We received payment of the FILSPARI market access initiative milestone of $40.0 million in the fourth quarter of 2025 and we anticipate achieving additional FILSPARI milestones with the potential for future payments depending on timing and outcomes of events over the next 12 months.
Beyond the next 12 months and over the foreseeable future, our known commitments and potential financial obligations will likely include ongoing operations funding, operating lease payments, interest payments on our outstanding debt, royalties on sales of our existing commercialized products, research and development expenses pertaining to clinical and preclinical development activities across our pipeline, milestone and royalty payments associated with FILSPARI, pegtibatinase, and other developmental programs based upon the achievement of certain agreement-specific criteria, along with sales-based royalties and the repayment of principal on the outstanding 2029 Notes, which mature on September 1, 2029. Potential sources of cash over this time horizon may include net revenues from sales of our existing products and, if commercialized, our pipeline products, licensing revenue, the sale or maturity of marketable debt securities in our investment portfolio, the refinancing of all or a portion of our debt, on or before maturity, or the issuance of additional debt or equity. In addition, depending on prevailing market conditions, our liquidity requirements, contractual restrictions, and other factors, we may also from time to time seek to retire or purchase our outstanding debt through cash purchases and/or exchanges for equity securities, in open market purchases, privately negotiated transactions or otherwise, and the amounts involved in such purchases and/or exchanges, individually or in the aggregate, may be material. We may not be able to successfully conduct financing or refinancing activity on favorable terms or at all.
Purchase Agreement Proceeds
Sale of Bile Acid Product Portfolio
In July 2023, we entered into the Purchase Agreement with Mirum, pursuant to which Mirum agreed to purchase substantially all of the assets primarily related to our business of development, manufacture and commercialization of the Products, which comprised our bile acid business. Upon the Closing of the transaction on August 31, 2023, we received an upfront cash payment of $210.0 million. Pursuant to the Purchase Agreement, we are eligible to receive up to $235.0 million upon the achievement of certain milestones based on specified amounts of annual net sales (tiered from $125.0 million to $500.0 million) of the Products.
Collaboration and License Proceeds
License and Collaboration Agreement with CSL Vifor
In September 2021, we entered into a license agreement with CSL Vifor, pursuant to which we granted an exclusive license to CSL Vifor for the commercialization of FILSPARI in the licensed territories. Under the terms of the license agreement, we will be eligible for up to $135.0 million in aggregate regulatory and market access related milestone payments and up to $655.0 million in aggregate sales-based milestone payments for a total potential value of up to $845.0 million. Through September 30, 2025, we have received upfront and milestone payments totaling $72.5 million and have earned an additional
$40.0 million, which was received in the fourth quarter of 2025, associated with the license agreement. We are also entitled to receive tiered double-digit royalties of up to 40 percent of annual net sales of sparsentan in the licensed territories.
See Note 4 to our unaudited Consolidated Financial Statements for further discussion.
Licensing Agreement with Renalys
In January 2024, our license agreement with Renalys Pharma, Inc. came into effect. Under the terms of the agreement, we granted an exclusive license to Renalys for the development and commercialization of sparsentan in Japan and other specified countries in Asia. Pursuant to the terms of the agreement, we are eligible to receive up to $120.0 million in aggregate regulatory, development and sales-based milestone payments. We are also entitled to receive tiered double-digit to mid-20 percent royalties of annual net sales of sparsentan in the licensed territories. In addition, we received an option to purchase shares of common stock of Renalys, which we exercised in January 2024.
See Note 4 to our unaudited Consolidated Financial Statements for further discussion.
Equity Offerings
2024 Underwritten Public Offering of Common Stock
In November 2024, we sold an aggregate of approximately 9.0 million shares of our common stock in an underwritten public offering, at a price to the public of $16.00 per share of common stock. The net proceeds from the offering, after deducting the underwriting discounts and offering expenses, were approximately $134.7 million.
At-the-Market Equity Offering
In October 2024, we filed a prospectus supplement to the prospectus included in our registration statement on Form S-3 (File No. 333-281194), pursuant to which we may offer and sell, from time to time through Jefferies LLC, as agent ("Jefferies"), up to $100.0 million of our common stock pursuant to an Amended and Restated Open Market Sale Agreement ("ATM Agreement") with Jefferies dated October 2024. The Company has not sold any shares under the ATM Agreement.
Operating Leases
Future Minimum Rental Commitments
As of September 30, 2025, we have future minimum rental commitments totaling $20.2 million arising from our operating lease and sublease income totaling $3.8 million. These commitments represent the aggregate base rent through August 2028.
See Note 7 to our unaudited Consolidated Financial Statements for further discussion.
Purchase Commitments
Manufactured Product
Certain of our contractual arrangements with contract manufacturing organizations ("CMOs") require binding forecasts or commitments to purchase minimum amounts for the manufacture of drug product supply, which may be material to our financial statements.
Royalties and Contingent Cash Payments
Ligand License Agreement
In 2012, we entered into an agreement with Ligand Pharmaceuticals, Inc. ("Ligand") for a worldwide sublicense to develop, manufacture and commercialize FILSPARI (the "Ligand License Agreement"). As consideration for the license, we are required to make substantial payments upon the achievement of certain milestones, totaling up to $114.1 million. Through September 30, 2025, we have paid $47.2 million for contractual milestones achieved under the Ligand License Agreement. Pursuant to the terms of the Ligand License Agreement, we are obligated to pay to Ligand an escalating royalty between 15% and 17% of net sales of FILSPARI and any other products containing FILSPARI or related compounds, with payments due quarterly. We began incurring costs associated with such royalties following the February 2023 approval of FILSPARI.
The Ligand License Agreement will continue until neither party has any further payment obligations under the agreement and is expected to continue for up to 20 years from the effective date. Ligand may terminate the Ligand License Agreement due to (i) our insolvency, (ii) our material uncured breach of the agreement, (iii) our failure to use commercially reasonable efforts to develop and commercialize FILSPARI as described above or (iv) certain other conditions. We may terminate the Ligand License Agreement due to a material uncured breach of the agreement by Ligand.
See Note 9 to our unaudited Consolidated Financial Statements for further discussion.
Mission License Agreement
In 2014, we entered into a license agreement with Mission Pharmacal ("Mission"), pursuant to which we obtained an exclusive, royalty-bearing license to market, sell and commercialize Thiola (tiopronin) in the United States and Canada, and a non-exclusive license to use know-how relating to Thiola to the extent necessary to market Thiola ("Mission License Agreement"). Under the terms of the Mission License Agreement, as subsequently amended, which runs through May 2029, we are obligated to pay to Mission the greater of $2.1 million, representing the guaranteed minimum royalty, or 20% of our Thiola net sales generated globally during each calendar year.
See Note 9 to our unaudited Consolidated Financial Statements for further discussion.
Acquisition of Orphan Technologies Limited
In November 2020, we completed the acquisition of Orphan Technologies Limited ("Orphan"), including Orphan's rare metabolic disorder drug pegtibatinase. We acquired Orphan by purchasing all of its outstanding shares. Under the Stock Purchase Agreement (the "Agreement"), we agreed to make contingent cash payments up to an aggregate of $427.0 million based on the achievement of certain development, regulatory and commercialization events as set forth in the Agreement, as well as additional tiered mid-single digit royalty payments based upon future net sales of any pegtibatinase products in the U.S. and Europe, subject to certain reductions as set forth in the Agreement, and a contingent payment in the event a pediatric rare disease voucher for any pegtibatinase product is granted. We made a $65.0 million payment in the second quarter of 2024 following the achievement of a development milestone.
See Note 13 to our unaudited Consolidated Financial Statements for further discussion.
French Rebate Accrual
In October 2021, our distributor in France for our previously marketed product Kolbam informed us that they had received a notice that the price previously paid for Kolbam during its period on the market in France had been recalculated by the agency responsible for pharmaceutical pricing in France. In October 2024, we received an invoice from the government authority in the amount of approximately $6.2 million for reimbursement of amounts previously paid for Kolbam, which we paid in November 2024. We have appealed the pricing decision and will pursue an appeal of the amount owed with the Competent Administrative Court.
Borrowings
Convertible Senior Notes Due 2029
On March 11, 2022, we completed a registered underwritten public offering of $316.3 million aggregate principal amount of 2.25% Convertible Senior Notes due 2029 ("2029 Notes"). We issued the 2029 Notes under an indenture, dated as of September 10, 2018, as supplemented by the second supplemental indenture, dated as of March 11, 2022 (collectively, the "2029 Indenture"). The 2029 Notes will mature on March 1, 2029, unless earlier repurchased, redeemed, or converted. The 2029 Notes are senior unsecured obligations of ours and bear interest at an annual rate of 2.25%, payable semi-annually in arrears on March 1 and September 1 of each year, beginning on September 1, 2022. The 2029 Notes do not contain any financial or operating covenants or any restrictions on the payment of dividends, the issuance of other indebtedness or the issuance or repurchase of securities by us.
See Note 10 to our unaudited Consolidated Financial Statements for further discussion.
Funding Requirements
We believe that our available cash and short-term investments as of the date of this filing will be sufficient to fund our anticipated level of operations beyond the next 12 months from the date of this filing. We expect to use cash flows from operations and, when necessary, outside financings, to meet our current and future financial obligations, including funding our operations, debt service and capital expenditures. Our ability to make these payments depends on our future performance, which will be affected by financial, business, economic, regulatory and other factors, many of which we cannot control. Factors that may affect financing requirements include, but are not limited to:
•the timing, progress, cost and results of our clinical trials, preclinical studies and other discovery and research and development activities;
•the timing and outcome of, and costs involved in, seeking and obtaining marketing approvals for our products, and in maintaining quality systems standards for our products;
•the timing of, and costs involved in, commercial activities, including product marketing, sales and distribution;
•our ability to successfully commercialize FILSPARI for the treatment of IgAN, and to obtain regulatory approval for, and successfully commercialize, sparsentan for FSGS and our other or future product candidates;
•increases or decreases in revenue from our marketed products, including decreases in revenue resulting from generic entrants or health epidemics or pandemics;
•payment obligations related to the 2029 Notes;
•the number and development requirements of other product candidates that we pursue;
•our ability to manufacture sufficient quantities of our products to meet expected demand;
•the costs of preparing, filing, prosecuting, maintaining and enforcing any patent claims and other intellectual property rights, litigation costs and the results of litigation;
•our ability to enter into collaboration, licensing or distribution arrangements and the terms and timing of these arrangements;
•the potential need to expand our business, resulting in additional payroll and other overhead expenses;
•the potential in-licensing of other products or technologies;
•the emergence of competing technologies or other adverse market or technological developments;
•the potential impacts of actions taken by the current administration, including but not limited to tariffs and changes at the FDA and other government agencies; and
•the impacts of inflation and resulting cost increases.
Future capital requirements will also depend on the extent to which we acquire or invest in additional complementary businesses, products and technologies.
Cash Flows from Continuing Operations
Cash Flows from Operating Activities
Cash used in operating activities from continuing operations for the nine months ended September 30, 2025 was $22.9 million compared to $201.4 million for the nine months ended September 30, 2024. The change was due to a $130.7 million increase in total net product sales, a regulatory milestone of $17.5 million and the timing of payments from normal operations.
Cash Flows from Investing Activities
Cash provided by investing activities for the nine months ended September 30, 2025 was $132.7 million compared to $179.6 million for the nine months ended September 30, 2024. The fluctuation in net cash used in investing activities resulted primarily from the timing differences in investment purchases, sales and maturities, and the fluctuation of our portfolio mix between cash equivalents and short-term investment holdings, an increase in intangible asset purchases, and a $65.0 million payment in the second quarter of 2024 following the achievement of a development milestone.
Cash Flows from Financing Activities
Cash used in financing activities from continuing operations for the nine months ended September 30, 2025 was $60.1 million compared to cash provided by of $0.3 million for the nine months ended September 30, 2024. The change was primarily due to repayment of the 2025 Notes, offset by proceeds from the exercise of stock options during the nine months ended September 30, 2025.
Other Matters
Adoption of New Accounting Standards
See Note 2 to our unaudited Consolidated Financial Statements in this report for a discussion of adoption of new accounting standards.
Recently Issued Accounting Pronouncements
See Note 2 to our unaudited Consolidated Financial Statements in this report for a discussion of recently issued accounting pronouncements.
Critical Accounting Estimates
Our consolidated financial statements are prepared in accordance with accounting principles generally accepted in the United States of America. The preparation of our consolidated financial statements and related disclosures requires us to make estimates and assumptions that affect the reported amount of assets, liabilities, revenue, costs and expenses, and related disclosures. We evaluate our estimates and assumptions on an ongoing basis. Our actual results may differ from these estimates under different assumptions and conditions. See our Annual Report on Form 10-K for the fiscal year ended December 31, 2024 for information about critical accounting estimates as well as a description of our other significant accounting policies.
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