Ardelyx Targets $500M Revenue This Year, Profitability by 2027

Key Points

• Ardelyx expects nearly $500 million in revenue this year and is targeting profitability by 2027, driven by growth in IBSRELA and XPHOZAH.
• IBSRELA revenue guidance is $350 million–$370 million, reflecting about 31% growth, but payer prior-authorization hurdles may delay the company’s longer-term $1 billion revenue opportunity.
• XPHOZAH is expected to generate $110 million–$120 million in revenue as Ardelyx focuses on commercially insured and Medicaid patients rather than participating in Medicare’s dialysis drug bundle.

Ardelyx NASDAQ: ARDX expects to generate close to $500 million in revenue this year and reach profitability in 2027, supported by continued growth of its IBS-C treatment IBSRELA and hyperphosphatemia treatment XPHOZAH, executives said at a Morgan Stanley event.

Chief Executive Officer Mike Raab said the company has transitioned into a commercial-stage business with two marketed products. IBSRELA is used for irritable bowel syndrome with constipation, or IBS-C, while XPHOZAH is for hyperphosphatemia in patients on dialysis.

“We are on a path right now to generate this year close to half a billion dollars of revenue,” Raab said. “As we have said in our last earnings, we are on a path to be profitable in 2027.”

Raab said Ardelyx intends to use future cash generation to support lifecycle management, including a chronic idiopathic constipation, or CIC, study for IBSRELA, as well as potential in-licensing and business-development transactions. The company’s intellectual-property runway extends to 2042, according to Raab.

IBSRELA Guidance Reflects Payer Pressure

Chief Financial Officer Sue Hohenleitner said the company’s revised IBSRELA revenue guidance of $350 million to $370 million for the year represents roughly 31% growth at the midpoint. Ardelyx had previously discussed a path to more than $1 billion in peak IBSRELA revenue, initially targeting 2029.

However, Hohenleitner said the company separated the timing of that target from the revenue opportunity itself because reaching $1 billion by 2029 would have required about a 38% compound annual growth rate. Ardelyx still believes in the $1 billion opportunity, she said, but expects it could take longer to reach.

Raab attributed the revised outlook in part to payer requirements, including prior authorizations that can create obstacles for patients seeking prescriptions. He said Ardelyx began discussions with payers but that its current guidance does not assume those pressures will ease during the year.

“We know that these talks take a little time, and we will look to do something in 2027 likely,” Hohenleitner said.

Ardelyx is also expanding its IBSRELA Pharmacy Network, or IPN, to route more prescriptions through specialty pharmacies rather than retail pharmacies. Raab said retail pharmacies are generally not structured to handle the prior-authorization demands associated with newer branded therapies, contributing to prescription abandonment.

According to Raab, the company’s data indicate that prescriptions processed through the IPN result in at least one to two additional filled prescriptions, including refills, compared with retail channels.

Market Opportunity and CIC Study

Raab said the IBS-C market includes approximately 13 million people in the U.S. and about 8 million prescriptions annually. He said Ardelyx would need less than roughly 10% market share to reach $1 billion in IBSRELA revenue.

The company is positioning IBSRELA for patients who have not been adequately served by other treatments, including secretagogues. Raab said IBSRELA has a different mechanism of action as an NHE3 inhibitor, and he emphasized its potential benefit in addressing the pain component that distinguishes IBS-C from chronic constipation.

Hohenleitner said more than 70% of patients treated with a secretagogue ultimately are not satisfied with or do not respond to therapy, representing an important opportunity for IBSRELA.

Ardelyx is enrolling patients in its ACCEL study evaluating IBSRELA in CIC. Hohenleitner said the company expects a readout in the middle of next year. Raab described CIC as a substantial opportunity, citing an estimated U.S. prevalence of about 30 million people, although many patients are treated with over-the-counter products. He said the prescription-treated CIC market is roughly comparable in size to IBS-C.

XPHOZAH Strategy Focuses Outside Medicare Bundle

For XPHOZAH, Raab said Ardelyx has chosen not to participate in the Medicare bundled-payment system for dialysis drugs. As a result, the company is focusing its commercial efforts on Medicaid and commercially insured patients, which Raab said represent about 40% of the dialysis population.

He said the decision was intended to preserve the product’s longer-term commercial opportunity, rather than pursuing a limited period of reimbursement within the government payment system. Ardelyx has a patient-assistance program for qualifying Medicare patients, he added.

The company has guided XPHOZAH revenue to $110 million to $120 million. Raab said Ardelyx withdrew its previous $750 million outlook for the product until the market effects of new phosphorus-management quality measures, potential competition and the end of the TDAPA period become clearer.

Raab said XPHOZAH is intended to help patients on dialysis manage serum phosphorus levels, an important issue in a U.S. dialysis population he estimated at roughly 550,000 patients.

Cash Position and Capital Allocation

Hohenleitner said Ardelyx ended the second quarter with nearly $282 million in cash and approximately $250 million of debt with SLR Capital Partners, including about $50 million drawn in June.

The company expects operating expenses to remain below $500 million this year. Hohenleitner said revenue should grow faster than operating expenses, while Ardelyx continues to invest in the CIC program and RDX10531, an early preclinical NHE3 inhibitor program.

Raab said RDX10531 is approximately 10 times more potent and 30 times more soluble than tenapanor, the active molecule behind IBSRELA and XPHOZAH. The company plans to follow preclinical data before determining whether to advance the program.

Looking ahead, management said it plans to prioritize growth of IBSRELA, lifecycle investments, business development and financial discipline, including potential debt refinancing. Raab said the company will evaluate opportunities both within its existing therapeutic areas and in adjacent or broader areas, with early-stage programs likely to be the most affordable near-term targets.

About Ardelyx (NASDAQ:ARDX)

Ardelyx, Inc is a biopharmaceutical company focused on developing and commercializing therapies for gastrointestinal and cardiorenal conditions. The company's lead product candidates and marketed medicines are designed to address disorders involving the regulation of phosphate and other substances in the digestive system.

Ardelyx markets XPHOZAH (tenapanor) in the United States for reducing serum phosphorus in adults with chronic kidney disease on dialysis. Tenapanor works locally in the gastrointestinal tract by inhibiting the sodium/hydrogen exchanger 3, thereby reducing intestinal phosphate absorption.

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