Ardelyx (ARDX) Q3 2026 Earnings Call Transcript

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DATE

Tuesday, Nov. 3, 2026

CALL PARTICIPANTS

• SVP, Investor Relations and Corporate Communications - Lisa Caperelli
• President and Chief Executive Officer - Michael Raab
• Chief Financial Officer - Sue Hohenleitner

TAKEAWAYS

• Total Product Revenue -- $125.5 million, representing 19% growth driven by increased demand for both IBSRELA and XPHOZAH.
• IBSRELA Revenue -- $96.3 million, a 23% increase year over year reflecting growth in total writers and total prescriptions.
• XPHOZAH Revenue -- $29.2 million, a 7% increase year over year despite being partially offset by specific customer buying patterns.
• Net Loss -- $700,000, narrowed from a $1 million loss in the prior year period.
• Cash and Investments -- $285.3 million, providing a liquidity base to fund operations and pipeline development.
• Research and Development Expenses -- $25.2 million, compared to $18.1 million in the prior year due to investment in the ACCEL Phase III trial.
• Selling, General and Administrative Expenses -- $93.9 million, up from $83.6 million reflecting sales force expansion and direct-to-consumer marketing.
• Gross Profit Margin -- Greater than 95%, which the company expects to leverage to grow operating margins.
• Blended Gross-to-Net Rate -- 31.7%, compared to 30.6% in the prior year period due to business mix and inflation rebate penalties.
• Full-Year IBSRELA Guidance -- $350 million to $370 million, representing over 30% growth at the midpoint.
• Full-Year XPHOZAH Guidance -- $110 million to $120 million, reaffirmed based on current market trends.
• Full-Year Operating Expense Guidance -- Below $500 million, as management maintains focus on expense management.
• XPHOZAH Sequential Revenue Decline -- 9%, occurring as a result of customer inventory and buying dynamics between the second and third quarters.
• XPHOZAH Paid Prescription Growth -- 22%, indicating strong underlying demand compared to the same quarter in 2025.
• Direct-to-Consumer Campaign Reach -- 10 million people, targeted through streaming platforms such as Netflix and Hulu to drive patient awareness.
• IPN Fulfillment Rate -- Two to three times higher than standard pharmacies, promoting the company's effort to transition writers to this network.
• Patient Refill Frequency -- At least one additional refill annually when utilizing the IPN network versus other pharmacy options.
• Patent Protection Period -- New formulation patent expected to issue Nov. 10, 2026, extending protection for IBSRELA and XPHOZAH to Dec. 6, 2041.
• Phase III ACCEL Trial Timeline -- Enrollment was completed ahead of schedule, with top-line data reports planned for the second half of 2027.

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RISKS

• Raab warned that "The dialysis reimbursement environment is complex, and we are taking thoughtful and measured approach to help ensure that XPHOZAH continues to be a positive contributor," noting that turmoil in the sector has persisted for over a year.
• Hohenleitner reported that XPHOZAH revenue was "offset by customer buying patterns in the quarter," leading to a sequential decline in reported revenue despite script growth.

SUMMARY

Ardelyx, Inc. (NASDAQ:ARDX) reported third quarter 2026 financial results highlighted by revenue growth and a strategy targeting profitability by 2027. Management stated that the company is utilizing its current product revenue to fund operations and expand its clinical pipeline. The company expanded its field reimbursement team and launched its first direct-to-consumer advertising campaign to improve patient awareness and address payer friction. Management reported that underlying demand for its core products remains strong despite complexities in the dialysis reimbursement environment.

• Management reported that the Phase III ACCEL trial for chronic idiopathic constipation reached full enrollment ahead of schedule, with CEO Raab stating, "Interest and pace of enrollment in the trial underscores the enthusiasm on the part of treating physicians."
• The company launched its first direct-to-consumer advertising campaign on Sept. 1, which has generated a significant increase in consumer website traffic and high intent among tested patients to request the treatment.
• Real-world data presented at medical conferences demonstrated that patients using IBSRELA experienced a drop in gastrointestinal-related healthcare resource utilization, primarily through fewer doctor visits and laboratory tests.
• The company is prioritizing the IBSRELA Pharmacy Network to reduce payer friction, as CEO Raab noted that patients experience faster fill times and higher fulfillment when the network is utilized.
• CFO Hohenleitner noted that the company ended the quarter with $285.3 million in cash and investments, stating, "Our financial position and disciplined capital allocation strategy gives us the flexibility to execute these priorities."

INDUSTRY GLOSSARY

• ACCEL: The name of the Phase III clinical trial evaluating tenapanor for chronic idiopathic constipation.
• CIC: Chronic idiopathic constipation, a gastrointestinal disorder characterized by difficult, infrequent, or incomplete bowel movements.
• FRM: Field Reimbursement Management, a team focused on assisting healthcare providers with prior authorization and patient access processes.
• IBSRELA: The brand name for tenapanor indicated for the treatment of IBS-C in adults.
• IPN: IBSRELA Pharmacy Network, a specialized network designed to streamline prescription fulfillment and improve patient adherence.
• TDAPA: Transitional Drug Add-on Payment Adjustment, a Medicare payment policy for certain new drugs in the dialysis setting.
• XPHOZAH: The brand name for tenapanor indicated to reduce serum phosphorus in adults with chronic kidney disease on dialysis.

Full Conference Call Transcript

Operator: [Presentation] Welcome to the Ardelyx Third Quarter 2026 Earnings Call. [Operation Instructions] I would now like to turn the conference over to Lisa Caperelli, SVP, Investor Relations and Corporate Communications. Lisa, you may begin.

Lisa Caperelli: Thank you, [ Paul ]. Good afternoon, and welcome to our third quarter 2026 financial results and business update call. Earlier today, we issued our earnings release, which can be found on the Investors Section of our website at ardelyx.com. Slides that accompany today's call can also be found on our website. On today's call, I am joined by Mike Raab, President and CEO of Ardelyx; 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 are 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 our other documents filed with the SEC. These forward-looking statements speak only as of today's date. And 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. Mike?

Michael Raab: Thank you, Lisa. Good afternoon, everyone, and thank you for joining us today. Ardelyx is a company focused on developing and commercializing innovative medicines. And today, with IBSRELA and XPHOZAH, we have 2 first-in-class medicines that in the third quarter generated over $125 million in revenue, up 19% from a year ago. With a strengthened financial position and a robust patent portfolio, our products are well-positioned for significant long-term growth. Our focus is now to leverage that foundation and to build a pipeline to create long-term value. Our third quarter's performance bolsters our confidence as we focus on executing on our priorities, accelerating the growth of IBSRELA, maintaining XPHOZAH's momentum, building and expanding our pipeline and delivering strong financial results.

Starting with IBSRELA. In Q3, IBSRELA generated revenue of $96.3 million, representing 23% year-over-year growth. HCP confidence in IBSRELA remains high with demand reaching all-time highs as the number of total writers, total prescriptions and market share continues to grow. This growth supports our full year guidance and reinforces our long-term view of achieving $1 billion in annual revenue. Critical to that is our ongoing work to thoughtfully eliminate the payer friction HCPs and patients experience when first starting IBSRELA. In our efforts to alleviate some of this friction in the third quarter, we began to see progress that gave us confidence that these initiatives are beginning to take hold.

As we've noticed in the past, IBSRELA is a promotionally sensitive brand, and mid-year, we expanded our sales force to increase reach and frequency to our target HCPs and continue to build the top of the funnel demand. In addition, we doubled our field reimbursement team to help HCPs navigate the prior authorization landscape. We're also continuing our efforts to transition writers to utilize the IBSRELA pharmacy network as we know that when the IPN is utilized, patients experience 2 to 3 higher fulfillment rates, faster fill times, and at least one additional refill per patient on an annual basis.

We will continue to assess all tools at our disposal to streamline the prior authorization process such as how best to leverage digital and AI tools. Our teams are executing at a high level, translating into notable results with total prescriptions growing. On September 1, we embarked on a highly targeted effort to raise awareness of IBSRELA with IBS-C patients and launched our first direct-to-consumer ad. This highly targeted ad has a clear call to action and is intended to reach more than 10 million people through outlets such as Netflix, Hulu, Prime Video and Disney.

In the testing phase of the ad with IBS-C patients, 91% of them said that they would ask their doctor if IBSRELA was right for them. And in a short time, we've seen that the campaign has delivered meaningful impressions and is driving an increase in traffic to our consumer-focused website. These are early positive indicators, and we continue to monitor how this increased awareness translate into new patient starts. As you know, the IBS-C market is very large. Over 7 million prescriptions are written for IBS-C-approved medications per year and more than 70% of patients continue to experience persistent symptoms, with IBSRELA being an important alternative for millions of dissatisfied IBS-C patients.

In addition to providing benefits to IBS-C patients, our real-world data demonstrated that there is also the potential of generating significant savings in health care services for IBS-C patients when they are treated with IBSRELA. A few weeks ago at the American College of Gastroenterology Annual Scientific Meeting, we presented real-world data showing that when IBSRELA -- when on IBSRELA, GI-related health care resource utilization drops, primarily driven by fewer doctor visits and labs. Taken together, IBSRELA not only provides symptom relief for IBS-C patients, but may also reduce broader health care resource burden associated with the disease. The fundamentals of the IBSRELA business remain very strong.

And by staying focused on execution and improving patient access, we are positioned to drive continued adoption and create meaningful benefits for patients. Now moving on to XPHOZAH. Revenue in Q3 was $29.2 million, representing 7% year-over-year growth, and we continue to see growth in paid prescriptions of 22% compared to the same quarter in 2025. The need for XPHOZAH remains high. In the United States, there are more than 550,000 adults with CKD on dialysis with more than 80% of them requiring treatment for hyperphosphatemia and yet nearly 70% of those patients struggle to reach and maintain target phosphorus levels.

A few weeks ago at the American Society of Nephrology Kidney Week, we presented real-world evidence supporting XPHOZAH's ability to consistently reduce serum phosphate. We also presented data highlighting the difficulty of managing hyperphosphatemia and the serious mortality morbidity associated with cumulative phosphate burden. Together, these findings continue to reinforce the need for XPHOZAH, a differentiated treatment that can help dialysis patients reach and maintain target phosphorus levels. As we've discussed before, the dialysis reimbursement environment is complex, and we are taking thoughtful and measured approach to help ensure that XPHOZAH continues to be a positive contributor. Now pivoting to our pipeline. Tenapanor is our foundation and will enable us to grow our pipeline.

Our most advanced program with IBSRELA is our ACCEL Phase III clinical trial in patients with chronic idiopathic constipation or CIC. Today, we announced that we have fully enrolled the trial ahead of schedule. The interest and pace of enrollment in the trial underscores the enthusiasm on the part of treating physicians for a new option for their patients experiencing the significant burden of CIC. Our confidence in the success with IBSRELA in CIC patients is, in large part, based on data from our IBS-C clinical development program. Patients with CIC and IBS-C have overlapping symptoms. We believe that expanding the use of IBSRELA to CIC will provide an additional option for patients currently underserved by their CIC treatments.

In October, we convened a Medical Advisory Board of HCPs to solicit their feedback on the CIC treatment landscape and our Phase III trial design. Three things stood out from that discussion that I'd like to share with you. First, the need is real as CIC patients cycle through multiple over-the-counter products for seeking care and, like IBS-C patients, often [awry] treatment experience. Second, there is a solid clinical rationale. CIC and IBS-C overlap substantially, and we believe that the clinical efficacy observed with IBSRELA on IBS-C could translate to patients with CIC. Third, the trial has been well received as evidenced by the faster-than-projected enrollment in the ACCEL trial.

We are encouraged by the progress we've made and look forward to reporting top line results in the second half of 2027. Finally, we are in a strong financial position with our $285 million of cash with our revenue funding our operations and supporting our path to profitability in 2027. And with that, I will now turn the call over to Sue to discuss the quarter's financials in detail. Sue?

Sue Hohenleitner: Thank you, Mike. Three points stand out for me from our third quarter results. First, IBSRELA continues to drive our growth with revenue up 23% year-over-year. Second, we're turning that growth into financial progress. Our net loss narrowed to $700,000, and we ended the quarter with $285.3 million in cash. Third, based on the continued strength and performance, we are reaffirming our full year guidance for both products and for operating expenses. Now let me walk you through the numbers. In the third quarter, our total product revenue was $125.5 million compared to $105.5 million in the same period last year, representing 19% growth year-over-year. IBSRELA Q3 revenue was $96.3 million, an increase of 23% compared to Q3 2025.

IBSRELA revenue growth reflects growing demand and an increase in total writers and total prescriptions. XPHOZAH revenue for the quarter was $29.2 million, an increase of 7% compared to Q3 2025. While the demand in Q3 sequentially grew, it was offset by customer buying patterns in the quarter. As Mike mentioned, the dialysis reimbursement environment is complex, and we are doing all we can to help ensure it remains a positive contributor. Now moving on to expenses. R&D expenses for the quarter were $25.2 million compared to $18.1 million for the same period in 2025. This increase primarily reflects the ongoing investment in the ACCEL Phase III clinical trial in CIC.

SG&A expenses for the quarter were $93.9 million compared to $83.6 million for the same period in 2025. This increase reflects the deliberate investments we made earlier in the year, including expanding the FRM team, optimizing the sales force, and launching the DTC initiative. Our financial strategy remains focused on driving towards profitability, which we continue to believe will occur in 2027. We are diligently focused on growing revenues while managing our operating expenses. Considering our greater than 95% gross profit margin and prudently managed OpEx, we anticipate our operating margin to grow as we move forward. That is the leverage of this business that I hope our shareholders appreciate.

Net loss for the third quarter was $700,000 compared to a net loss of $1 million for the same period in 2025. The net loss for Q3 2026 included $15.1 million for non-cash expenses from share-based compensation compared to $12.7 million for the same period in 2025. We ended the third quarter with $285.3 million in cash, cash equivalents, and short-term investments. Our liquidity remains robust. We are using our cash and revenue base to fund our operations and our pipeline. Now turning to guidance. For IBSRELA, we are reaffirming our full year 2026 guidance of $350 million to $370 million. This represents annual growth of more than 30% at the midpoint.

For XPHOZAH, we're reaffirming our full year 2026 revenue guidance of $110 million to $120 million. For OpEx, we continue to expect our full year 2026 operating expenses to be below $500 million. As we build towards profitability in 2027, OpEx and prudent expense management are key priorities for us. As a company, we're focused on 3 things: executing commercially, investing with discipline, and delivering value for our patients and shareholders. Our financial position and disciplined capital allocation strategy gives us the flexibility to execute these priorities and build on our strong foundation. And with that, I will hand it back to Mike.

Michael Raab: Thank you, Sue. We're a company with 2 first-in-class medicines, a solid financial foundation, a developing pipeline anchored by tenapanor and a team that has demonstrated that it can execute. I'm confident in the team and its ability to build on that foundation, and we look forward to sharing more about what comes next. Thank you for your continued support. And with that, Paul, we can open the call for questions.

Operator: [Operator Instructions] And our first question comes from Yigal at Citi.

Unknown Analyst: This is [ Carla ] on for Yigal. You've highlighted the benefits of the IBSRELA pharmacy network in terms of fulfillment and adherence. Can you tell us what percentage of prescriptions are flowing through the network today? And how much opportunity remains to further increase penetration?

Michael Raab: Yes. Thanks for the question. I mean the IBSRELA pharmacy network is clearly key to our strategy going forward. It's probably premature for us to give you any specifics in terms of what is actually flowing through. It's something that we want to do thoughtfully and carefully to not cause additional disruption. So it's probably not time for us to give you that kind of specificity.

Unknown Analyst: Okay. And if I may, in terms of the long-term XPHOZAH revenue target, what are the key variables you'd need to see to become comfortable with reestablishing that longer-term framework for the business?

Michael Raab: Sure. No, that's an important question. We're just coming to the end of the TDAPA period for the binders and the turmoil that we've been talking about for the better part of 1.5 years continues. So I think we all need to be patient until we exit this TDAPA period, see what next year looks like. And when we have confidence, we'll come back to you with those numbers.

Operator: Our next question comes from Roanna Ruiz of Leerink Partners.

Roanna Clarissa Ruiz: A couple for me. So first one, I was wondering if you could talk a bit more about the specific initiatives you've been doing to eliminate payer friction that came through in prior quarters? And are you able to talk about if you have any sense if this could happen again? Was it more a onetime thing or it could be a part of new seasonality for payer dynamics?

Michael Raab: Yes. I mean, I think, the most important thing, Roanna, is the growing demand and how strong that has been, right? The top of the funnel is sort of our true north that we all should continue to be paying attention -- we can't assume it's a one-and-done is something we in this industry always have to focus on, right? If a physician has identified that you need a certain medicine and then you can't get it as a patient, that's the friction that we speak of.

So we will be very thoughtful as we look at all approaches of doing this, I mentioned, whether it's AI, other digital efforts, the discussions we're having with payers, how we optimize that, and importantly, the FRMs that we have in the field that are working hand in glove with our ABDs and the offices to help people get familiar with the process of getting a prior authorization filled. So there isn't one answer to this. It is going to be a panoply of many things that we have to be prepared to do.

Sue Hohenleitner: Yes. And I would just add, the physicians are very strongly convicted in prescribing IBSRELA. I really think it's -- we've got to get them through that funnel and get more approvals through. So I think the great thing there is, Roanna, like the product is amazing. We hear that all the time from patients and from physicians.

Operator: Our next question comes from Matt Caulfield at H.C. Wainwright.

Unknown Analyst: Congrats for another great earnings, and this is Dora on Matt. Our question is, since you expanded the field reimbursement management team, how has the PA approval and the fill rates through the IPN network trended?

Michael Raab: Yes. I mean I think as we spoke, we definitely see higher fulfillment rates through the IPN. I'm not going to give you any specific numbers on it at this stage. But importantly, we see an additional script filled per annum at least, and it's just easier for the physicians when they have the help and their staff helping the prior authorization to be accomplished. So again, it is going to be all of these things happening at the same time not just one magic bullet, sadly. We have to be prepared to deploy FRMs as we have. They're doing phenomenal work in the field with the Area Business Directors.

And my guess is that their calendars are chock-full of requests for support from the field as they continue to see other ways to help offices accomplish the goal.

Operator: Our next question comes from Laura Chico of Wedbush Securities.

Laura Chico: I've got a housekeeping one, Mike. How did inventory at wholesalers change during the third quarter? I might have missed that if you commented, sorry. And then in the past, you've indicated when you expand the field force, it takes a few quarters for that to be translating into greater sales. But I'm curious on the FRM side, by increasing that top of funnel layer, how should we think about the time for the reimbursement team expansion to impact fill times and shorten that?

Michael Raab: Yes. I mean there's -- I'll have Sue address the inventory question. Let me address the FRM question first, is there is plenty to do for the FRM team. And all I hear directly from the field is how grateful they are and helpful they are in getting things accomplished. So probably no direct metrics that I can give you right now. But it is clear once the engine gets running in an office, that an office gets accustomed to the process, similar to what they're doing for other drugs that they have in their armamentarium for other diseases in the GI practice, getting IBSRELA the same kind of attention as what our FRMs are doing.

And it becomes a little bit like a muscle that is exercised as offices get more familiar with it, it becomes easier and the FRMs are doing phenomenal work in accomplishing that.

Sue Hohenleitner: Yes. And just -- Laura, just to address the buying dynamics, I really more comment that for XPHOZAH because what you see from a script growth perspective, sequentially, you see our scripts growing. But quarter-over-quarter, we did show a decline of about 9%, and that was really just the buying dynamics. So depending on what day of the week, the second quarter versus the third quarter end, we can have a little bit of like a little lower inventory, et cetera. So I wanted to comment to that because we did see that sequential decline. Nothing of note. It's really just, from time to time as the a little bit more, a little bit less...

Michael Raab: And Laura, I think as we said in the past, much of this inventory is almost just in time. There isn't significant amount out [ there ].

Operator: Our next question comes from Allison Bratzel of Piper Sandler.

Unknown Analyst: This is [ Peter ] on for Ali. Just wondering how investors should frame the range of outcomes across the Phase III ACCEL doses? And what would you view as a clinically meaningful result? And if ACCEL is positive, which patients do you see as the most relevant candidates for IBSRELA in CIC? And how large could that opportunity be?

Michael Raab: Very thorough question, Peter. And some of those things we'll get into more specifics as we talk more about CIC and the program going forward as we see the data. But a win is a successful clinical trial, right? You're looking at the durable response, which is the endpoint for CIC patients. So it's basically the constipation endpoint you saw in IBS-C without pain. And that's really a differentiator between the 2 populations. So the durable response that you need there is through the last 4 weeks of the period, you have to have a maintained effect of the drug and similar to what we saw with the IBSRELA trial in IBS-C.

I think as we've spoken before, the epi of this constipation market is significantly greater than IBS-C. Now the vast majority of those patients are treated sufficiently with over-the-counter medications. Now, I think as you heard in my opening statements, what we do see is the journey that CIC patients who aren't responding to OTC or even current prescription drugs because they're well-experienced with a lot of different treatments, those are the ones that come to IBSRELA. We shouldn't expect that we're going to get first-line treatment just given the nature of the payer environment for any of these indications. So it's not dissimilar to what we anticipate and see in the IBSRELA for IBS-C patient population.

Operator: Our next question comes from Julian Harrison of BTIG.

Julian Harrison: Let me add my congratulations on the quarter. First, regarding the ACCEL initiative progress that you mentioned gaining traction in the third quarter. Can you clarify whether the underlying payer requirements themselves have changed at all or whether that progress is mostly reflective of more efficient execution on prior authorizations? And then on the DTC campaign, I'm curious if you're already seeing any measurable step-up in patient engagement or prescription demand? And was the strategy around the September timing there considering the strong seasonality you typically see for IBSRELA in the fourth quarter?

Michael Raab: Yes. So I think your last part first, yes, I mean, we moved it up as quickly as we could, just given our enthusiasm and the testing for the ad that we saw, right? As I said in my opening comments, when we tested the ad with IBS-C patients, 91% of them said that they would ask for it going to their physician. And we know the grant rate from physicians is quite high when a patient asks for a certain medicine. So that all aligns appropriately for what we want. As I said in my opening statement, we've seen a significant increase in our traffic to our consumer-based website as we launched in September.

So whether or not that translates into more scripts, early days, and that's something we'll monitor and share with everyone as we get that. To the first part of your question, the answer is yes. I think it's everything together, similar to the other answers I've given, that we have to be pulling on all different threads to try to facilitate this challenge that all of -- all patients, irrespective of IBSRELA or any therapeutic area for a new medicine, prior authorization battles are what we all have to fight for in this industry. So deploying all tactics to try to facilitate that is what we're doing, whether it's the FRMs thoughtfully negotiating with payers.

We cannot give away the store. So we're going to be very mindful of getting something for what we give because I think as you've heard me over the years, we could give every penny of profit away, and we probably wouldn't have a substantively greater position than we have today. So it's really trying to understand at the bottom of the funnel, what are the investments that we make to facilitate that process.

Operator: Our next question comes from Chris Raymond of Raymond James.

Samuel Alexander Leach: This is Sam on for Chris. Just one follow-up on CIC. I know there's already a significant amount of off-label scripts for IBSRELA in this indication. Could you give us a ballpark estimate of how many IBSRELA patient scripts today are driven by CIC and then how you think a future label expansion would change that?

Michael Raab: Yes. I mean, off-label utilization is probably something I won't comment on. We are approved only for IBS-C. So that's what we anticipate folks are going to go to. Now as we all know, a physician in practice of medicine can fight for a different utilization, and that's their prerogative. We agree that there has been some organic utilization, both this and for that and for in first-line. That's ultimately, I think, indicative of the conviction that treaters have for what IBSRELA can do for their patient population. I think, as I said both in my opening comments and some of the questions that have happened already, is it's a sizable market.

It will eliminate a friction where you as a physician have to determine whether I have constipation pain or not. And if I don't have constipation with pain, I probably will not get an IBSRELA script until you get the CIC indication. That's the friction we're trying to eliminate at the office level at the top of the funnel. We'll always have the battles at the bottom of the funnel, which is why we're investing in the FRMs and the other things that we're doing.

Operator: Our next question comes from Prakhar Agrawal of Cantor Fitzgerald.

Prakhar Agrawal: Congrats on the quarter as well. So maybe on IBSRELA in 2027, I guess if you can comment on how we should think about access and contracting given that's something that you had discussed before will be more prevalent for IBSRELA going forward? And maybe what does it mean for the evolution of gross to net? And maybe if you can clarify what was the gross to net for 3Q as well?

Michael Raab: Yes. I appreciate your effort trying to get us to give you some perspective on '27, but you know I won't. But we're going to mindfully do this, right? We're not going to just do deals for the deal's sake in contracting. So I think you'll see us meaningfully, slowly, and thoughtfully move into it, but we got to get something in return for it. That's the rule. Gross to net, obviously, we won't comment for '27, but for current gross to net...

Sue Hohenleitner: Yes. For current gross to net, Prakhar, for the 3 months, our blended rate was 31.7%, and that compares to this time last year was about 30.6%. So we continue to show a little bit more of erosion to GTN, really, just the normal mix of business as well as the inflation rebate penalties that we have to pay. So as I've said before, our GTN, although we combine it, we're like low- to mid-30s is kind of what to expect, and that's squarely where we are now for '26.

Operator: Our next question comes from Dennis Ding of Jefferies.

Yuchen Ding: So regarding IBSRELA, how are the -- we've noticed some script weakness over the last few weeks and also some simultaneous channel mix. We are reassured at the fact that you reiterated IBSRELA guidance, which means that the fundamentals are still fine. So is it that there's a reporting discrepancy with the scripts?

Michael Raab: I mean, I think, as we all have talked about over this year, as we move to IPN, those are projected, right? So that's not 100% capture. We're very confident in the guidance that we've given. So the fundamentals are absolutely strong as you articulated then. So that's why we reaffirm where we think we're going to end up this year. The business remains strong. The opportunity is significant. And as we move into IPN, there's probably going to be more projection and your patience, as we look at projected numbers versus 100% capture that we see from IQVIA for other brands, is just something we're going to have to navigate together.

Sue Hohenleitner: Yes. And I would just add to that, too, a blip here and there, we try to really just look at the trends because we know there's some data inaccuracy depending on what data source you use. So trends are looking strong and obviously continue to give us the confidence to reaffirm the guidance that we gave.

Operator: Our next question comes from Caroline Palomeque of Ladenburg Thalmann.

Caroline Palomeque: So are there any updates on the pediatric program for IBSRELA, either in the IBC -- I'm sorry, in the IBS-C indication or the FC indication?

Michael Raab: No. I mean what we [ did in this ] earnings was to give you an update on status changes, which is why we gave you the update on ACCEL. Nothing new to report on the pediatric program.

Sue Hohenleitner: Operator, is there any other question?

Operator: Yes. Our next question comes from Peyton Bohnsack of TD Cowen.

John Peyton Bohnsack: I guess with all the initiatives that you've got on board, could you give us kind of a general time line when you want to see kind of inflection in either fulfillment rates or less friction, just to give kind of investors a sense of what to look for? And then kind of secondly, what makes you feel that these are -- this is the right amount of initiatives to take in order to put a stop to any friction with your payers?

Michael Raab: Let me address the second part first. I never rest. So I'm not sure it's always enough initiatives. We should always be thinking of new things and trying new things as we look at the challenges that you face in any new drug like this. I think a dramatic inflection is probably not something anyone should anticipate. This is going to be something that we're going to take steps in improving over time. There isn't some magic bullet that you're suddenly going to see a dramatic change in PA rates. And certainly, what that would cost is not something I'm willing to even contemplate because you have no certainty.

So I think we all need to be prepared for meaningful steps that are going to take some time to eliminate the friction, both bottom of the funnel with things like FRMs and thoughtful contracting and rebating with payers. We need to be certain that what we're giving up, because it's a one-way street, that it is actually something that's going to yield a benefit to the patients who are going through this process.

Operator: And this concludes our question-and-answer session. There are no further questions at this time. And this concludes today's conference call. Thank you for joining.

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