Financial Performance - In 2023, the company generated $78.3 million in net revenues from the sale of its products in the U.S.[204] - The company has generated $187.2 million in net revenue from product sales in the U.S. since the launch of its products[306] - The net losses for the years ended December 31, 2023, and 2022 were $209.2 million and $233.7 million, respectively, with an accumulated deficit of $1.5 billion as of December 31, 2023[307] - The company expects to incur significant expenses and operating losses for the foreseeable future related to the commercialization of NEXLETOL and NEXLIZET[308] - The company anticipates an increase in selling, general, and administrative expenses in 2024 due to potential additional global regulatory approvals and expanded commercialization initiatives[308] - The company has incurred significant operating losses since its inception and anticipates continued losses for the foreseeable future[306] Regulatory Approvals and Challenges - The FDA approved NEXLETOL (bempedoic acid) and NEXLIZET (bempedoic acid and ezetimibe) in February 2020, with commercial availability starting in March and June 2020 respectively[204] - The company expects approval decisions on expanded indications for NEXLETOL and NEXLIZET in the first quarter of 2024[205] - The company faces risks related to obtaining regulatory approvals for its products in various territories[206] - The company acknowledges that any setbacks in regulatory approvals could materially affect its business and prospects[211] - Regulatory authorities may impose significant restrictions on bempedoic acid and the bempedoic acid/ezetimibe combination tablet's indicated uses or marketing, requiring costly post-approval studies[217] - The FDA has mandated both a PK/PD and Phase 3 study for bempedoic acid in patients with HeFH aged 10 to less than 18 years as part of the approval process[217] Market Competition - The market for LDL-C and cardiovascular risk-lowering therapies is highly competitive, with significant competition from generic statins and other pharmaceutical companies[260] - The company faces potential competition from generic versions of bempedoic acid and the bempedoic acid/ezetimibe combination tablet, which could adversely affect sales[220] - The company faces competition from inexpensive generic versions of statins and other lipid-lowering therapies, which could impact market share[263] - Competitors may have greater financial and technical resources, potentially impacting the company's ability to achieve regulatory approval and market acceptance for its products[262] - The company has received marketing approval for bempedoic acid and the bempedoic acid/ezetimibe combination tablet in the U.S. and Europe, but may face challenges in achieving broad market acceptance, which could limit revenue generation[265] Financial and Capital Needs - The company may need to pursue equity or debt financings to meet its capital needs due to market volatility[199] - The company may need substantial additional capital in the future to fund ongoing operations and commercialization efforts[311] - The company may face challenges in generating sufficient cash flow to service its debt obligations, which could lead to asset sales or restructuring[322] - Payment requirements under the RIPA may increase cash outflows significantly starting in 2025 if certain revenue milestones are not met, potentially leading to higher payments[318] - The company has issued $280.0 million of 4.00% convertible senior subordinated notes due 2025, with interest payable semi-annually[322] Compliance and Legal Risks - Relationships with healthcare providers and third-party payors are subject to strict healthcare laws, which could expose the company to legal and financial risks[224] - The company may face damages, fines, or penalties if it fails to comply with relevant laws and regulations regarding patient assistance programs[228] - The company may incur significant legal expenses and operational disruptions due to investigations or actions stemming from non-compliance with healthcare laws[229] - The company faces significant civil monetary penalties if found to have submitted false pricing information to CMS or failed to submit required price data on time[245] - The company is subject to risks related to intellectual property litigation, which could result in substantial damages and affect product commercialization[300] Intellectual Property and Patents - As of December 31, 2023, the company holds approximately 10 issued U.S. patents and 17 pending U.S. patent applications, along with over 25 issued patents and over 80 pending applications in foreign jurisdictions[342] - U.S. Patent No. 7,335,799, covering bempedoic acid, is set to expire in December 2025, with a potential five-year extension requested[343] - The company is pursuing patent protection for the bempedoic acid/ezetimibe combination tablet, with claims in U.S. Patent Nos. 10,912,751 and 11,744,816 scheduled to expire in March 2036[344] - The company faces risks from potential competitors filing for generic versions of bempedoic acid or the combination tablet, which could adversely affect future revenue and profitability[353] - The company relies on unpatented trade secrets and technological innovation, protected by confidentiality agreements with employees and collaborators[356] Operational Risks - The company relies entirely on third-party suppliers for the manufacturing of clinical drug supplies for bempedoic acid and the bempedoic acid/ezetimibe combination tablet, lacking internal manufacturing capabilities[376] - Any delays in finding alternative contract research organizations (CROs) could significantly impact the commercialization timeline of bempedoic acid products, potentially incurring substantial costs[375] - The company must maintain a risk management plan under the CARES Act to address potential shortages in the supply of approved drugs, which could materially impact results[378] - The company is exposed to risks related to employee misconduct, which could lead to regulatory sanctions and harm its reputation[274] Market and Stock Performance - The stock price of the company is subject to volatility influenced by various factors, including clinical trial results and regulatory actions[381] - The company qualifies as a "smaller reporting company," allowing for reduced public disclosure, which may affect the attractiveness of its common stock to investors[387] - If analysts cease coverage or publish unfavorable reports, the company's stock price and trading volume could decline[389] Environmental, Social, and Governance (ESG) Considerations - Increased scrutiny regarding environmental, social, and governance (ESG) initiatives may lead to higher costs and reputational risks for the company[390] - The company may engage in voluntary ESG initiatives, but these could be costly and may not yield the desired outcomes[391]

Esperion Therapeutics (ESPR) is expected to deliver a year-over-year increase in earnings on higher revenues when it reports results for the quarter ended December 2023. This widely-known consensus outlook gives a good sense of the company's earnings picture, but how the actual results compare to these estimates is a powerful factor that could impact its near-term stock price.The earnings report might help the stock move higher if these key numbers are better than expectations. On the other hand, if they mi ...

ANN ARBOR, Mich., Feb. 13, 2024 (GLOBE NEWSWIRE) -- Esperion (NASDAQ: ESPR), today announced it will report fourth quarter and full year 2023 financial results before the market opens on Tuesday, February 27, 2024. Following the release, management will host a webcast at 8:00 a.m. ET to discuss these financial results and provide business updates. Please click here to pre-register to participate in the conference call and obtain your dial in number and PIN. Already registered? Access with your PIN here.  A ...

CONCORD, N.C., Feb. 01, 2024 (GLOBE NEWSWIRE) -- RFK Racing and Esperion Therapeutics have announced the promotional schedule for the 2024 season, highlighted by a four-race slate, and numerous accompanying campaigns and initiatives, all driving awareness of its two brands – NEXLIZET (bempedoic acid and ezetimibe) and NEXLETOL (bempedoic acid) used for adults on a statin to reduce LDL-cholesterol. Esperion's season debut comes in the first race at Richmond this spring (March 31) on the No. 17 of Chris Buesc ...

Financial Data and Key Metrics Changes - Total revenue for Q3 2023 was $34 million, representing a 79% increase year-over-year [61] - US net revenue was $20.3 million, a 45% increase year-over-year, driven by a 33% year-over-year increase in retail prescription equivalents [45] - Collaboration revenue, including combined royalty and partner revenue, was $13.7 million, an increase of approximately 174% year-over-year [54] - Cost of goods sold was $13.4 million, an increase of 106% year-over-year [13] - R&D expense was $14.9 million, a decrease of 49% year-over-year [13] - SG&A expense was $33.2 million, an increase of 33% year-over-year [55] - Cash equivalents and investment securities totaled $114.8 million as of September 30, 2023, down from $166.9 million on December 31, 2022 [62] Business Line Data and Key Metrics Changes - Retail prescription equivalents (RPE) grew 33% year-over-year and 8% quarter-over-quarter [11] - New-to-brand prescriptions grew 61% from March to September 2023 [46] - Weekly RPE trend remained above the 10,000 RPE mark, setting new weekly highs [53] Market Data and Key Metrics Changes - Three additional countries (Netherlands, Slovakia, and Spain) received approvals during Q3 2023 [12] - In Europe, 158,000 patients have been treated with the therapies, representing a sequential growth of 26% since May [60] Company Strategy and Development Direction - The company is focused on expanding its label to include cardiovascular risk reduction, which is seen as a significant growth catalyst [49] - A strategic collaboration with ACC and Amgen was announced to launch a cholesterol screening campaign [50] - The company anticipates a new label approval by March 31, 2024, which will significantly increase the addressable patient population [51] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the ongoing litigation case and the potential for a positive ruling [20] - The company is preparing for the new label and expects to see accelerated prescription growth following the approval [49] - Management highlighted the importance of payer changes to realize the full potential of the new label [73] Other Important Information - The company is managing expenses diligently while preparing for a full-scale commercial launch next year [14] - The litigation case with Daiichi is ongoing, with a trial date set for April 15, 2024 [57] Q&A Session Summary Question: What is the outlook for gross-to-net trends in Q4? - Management noted typical seasonality in Q3 and expects continued improvement in gross-to-net trends over the longer term [19] Question: When could the milestone from the litigation case hit Esperion's balance sheet? - Management indicated that the milestone would not be recognized until early 2024, and they remain confident in the timeline [66] Question: How does the company plan to attract physicians interested in the drug? - Management mentioned that the team is unable to discuss new data until the label changes, which will help in expanding the population [22] Question: What is the typical patient profile for bempedoic acid? - The typical patient is on maximally tolerated statin therapy and not at their LDL-C goal, with a strong desire for primary prevention [80] Question: What are the approval rates for the therapies? - Approval rates have reached approximately 85% in commercial and Medicare, following presentations of CVOT data [83]

• On max tolerated statin Important Safety Information | --- | --- | |-------------------------------------|----------------------| | FY 2023 R&D Guidance | $100 - 110 Million | | FY 2023 SG&A Guidance | $125 - 135 Million | | FY 2023 Op Ex Guidance1 | $225 - 245 Million | | Q3 2023 Common Shares Outstanding 2 | 112.1 Million | © 2023 Esperion. All/Rights Reserved – Do not copy or distribute. 13 © 2023 Esperion. All Rights Reserved – Do not copy or distribute. Corporate Update • Filed Rule 12(c) motion, req ...

PART I — FINANCIAL INFORMATION [Financial Statements](index=3&type=section&id=Item%201.%20Financial%20Statements) This section presents the unaudited condensed interim financial statements for Esperion Therapeutics, Inc. as of September 30, 2023, and for the three and nine-month periods then ended [Condensed Balance Sheets](index=3&type=section&id=Condensed%20Balance%20Sheets) As of September 30, 2023, total assets decreased to $221.3 million from $247.9 million, while total liabilities increased to $631.3 million from $571.7 million, widening the stockholders' deficit Condensed Balance Sheet Highlights (in thousands) | Account | Sep 30, 2023 (unaudited) | Dec 31, 2022 | | :--- | :--- | :--- | | **Assets** | | | | Cash and cash equivalents | $114,833 | $124,775 | | Inventories, net | $51,435 | $35,201 | | Total current assets | $218,227 | $246,683 | | Total assets | $221,305 | $247,939 | | **Liabilities & Stockholders' Deficit** | | | | Total current liabilities | $137,708 | $92,308 | | Convertible notes, net | $261,165 | $259,899 | | Revenue interest liability | $267,400 | $243,605 | | Total liabilities | $631,309 | $571,717 | | Total stockholders' deficit | $(410,004) | $(323,778) | [Condensed Statements of Operations and Comprehensive Loss](index=4&type=section&id=Condensed%20Statements%20of%20Operations%20and%20Comprehensive%20Loss) For Q3 2023, total revenues increased to $34.0 million, and the net loss narrowed to $41.3 million, with similar trends observed for the nine-month period Three Months Ended September 30, (in thousands, except per share data) | Metric | 2023 | 2022 | | :--- | :--- | :--- | | Product sales, net | $20,251 | $13,964 | | Collaboration revenue | $13,718 | $5,016 | | **Total Revenues** | **$33,969** | **$18,980** | | Loss from operations | $(27,533) | $(41,623) | | **Net loss** | **$(41,250)** | **$(55,117)** | | Net loss per share | $(0.37) | $(0.81) | Nine Months Ended September 30, (in thousands, except per share data) | Metric | 2023 | 2022 | | :--- | :--- | :--- | | Product sales, net | $57,575 | $40,896 | | Collaboration revenue | $26,509 | $15,761 | | **Total Revenues** | **$84,084** | **$56,657** | | Loss from operations | $(113,196) | $(136,988) | | **Net loss** | **$(152,904)** | **$(178,172)** | | Net loss per share | $(1.53) | $(2.78) | [Condensed Statements of Stockholders' Deficit](index=5&type=section&id=Condensed%20Statements%20of%20Stockholders'%20Deficit) The stockholders' deficit increased to $410.0 million by September 30, 2023, primarily due to a net loss, partially offset by capital raised from equity issuances - The total stockholders' deficit grew to **$(410.0) million** at September 30, 2023, from **$(323.8) million** at December 31, 2022[15](index=15&type=chunk) - Key activities impacting the deficit during the first nine months of 2023 included a net loss of **$152.9 million**, stock-based compensation of **$9.0 million**, and net proceeds from stock and warrant issuances of approximately **$56.9 million**[15](index=15&type=chunk) [Condensed Statements of Cash Flows](index=7&type=section&id=Condensed%20Statements%20of%20Cash%20Flows) For the nine months ended September 30, 2023, net cash used in operating activities improved, resulting in a $9.9 million net decrease in cash and cash equivalents Cash Flow Summary for Nine Months Ended Sep 30, (in thousands) | Activity | 2023 | 2022 | | :--- | :--- | :--- | | Net cash used in operating activities | $(98,431) | $(132,355) | | Net cash provided by investing activities | $42,500 | $19,898 | | Net cash provided by financing activities | $45,989 | $62,964 | | **Net decrease in cash and cash equivalents** | **$(9,942)** | **$(49,493)** | | Cash, cash equivalents at end of period | $114,833 | $209,399 | [Notes to Condensed Financial Statements](index=8&type=section&id=Notes%20to%20Condensed%20Financial%20Statements) The notes detail accounting policies, the successful CLEAR Outcomes trial, sNDA submissions, a dispute with DSE over a $300 million milestone, and recent equity financing - The company completed its CLEAR Outcomes trial, which met its primary endpoint, showing significant cardiovascular risk reductions with bempedoic acid[20](index=20&type=chunk)[21](index=21&type=chunk) - Supplemental New Drug Applications (sNDAs) were submitted to the FDA and a Type II(a) variation application was filed with the EMA to add cardiovascular risk reduction to product labels, with decisions expected in 2024[23](index=23&type=chunk)[24](index=24&type=chunk) - The company is in a legal dispute with its European partner, DSE, regarding its right to receive a **$300 million** milestone payment related to the CLEAR Outcomes trial results[71](index=71&type=chunk)[72](index=72&type=chunk) - In March 2023, the company raised approximately **$52.4 million** in net proceeds through a registered direct offering of common stock, pre-funded warrants, and warrants[22](index=22&type=chunk)[127](index=127&type=chunk) [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=27&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses increased revenues, a narrowed net loss due to higher revenue and lower R&D expenses, and a sufficient liquidity position to fund future operations [Results of Operations](index=32&type=section&id=Results%20of%20Operations) For Q3 2023 and the nine-month period, revenue increased, R&D expenses decreased, and SG&A expenses rose, leading to a reduced net loss - **Q3 2023 vs Q3 2022:** - **Product sales, net:** Increased by **$6.3 million** due to prescription growth of NEXLETOL and NEXLIZET[168](index=168&type=chunk) - **Collaboration revenue:** Increased by **$8.7 million** due to higher product sales to partners and royalty growth[169](index=169&type=chunk) - **R&D expenses:** Decreased by **$14.2 million** primarily due to lower costs for the CLEAR Outcomes study[171](index=171&type=chunk) - **SG&A expenses:** Increased by **$8.2 million** due to higher legal and promotional costs[172](index=172&type=chunk) - **Nine Months 2023 vs 2022:** - **Product sales, net:** Increased by **$16.7 million** due to prescription growth[176](index=176&type=chunk) - **Collaboration revenue:** Increased by **$10.7 million** from higher partner sales and royalties[177](index=177&type=chunk) - **R&D expenses:** Decreased by **$17.5 million** due to lower CLEAR Outcomes study costs[179](index=179&type=chunk) - **SG&A expenses:** Increased by **$12.2 million** from higher legal, consulting, and promotional expenses[180](index=180&type=chunk) [Liquidity and Capital Resources](index=35&type=section&id=Liquidity%20and%20Capital%20Resources) As of September 30, 2023, the company had $114.8 million in cash, supplemented by recent equity offerings, and expects sufficient liquidity for the foreseeable future - The company's primary source of liquidity as of September 30, 2023, was **$114.8 million** in cash and cash equivalents[184](index=184&type=chunk) - During the nine months ended September 30, 2023, the company raised approximately **$4.4 million** net from its 2023 ATM Program and approximately **$52.4 million** net from a registered direct offering and warrant amendments[183](index=183&type=chunk)[193](index=193&type=chunk) - Management believes current cash and expected future revenues are sufficient to fund operations for the foreseeable future[183](index=183&type=chunk)[197](index=197&type=chunk) [Quantitative and Qualitative Disclosures About Market Risk](index=38&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) There have been no material changes to the company's market risk disclosures since its 2022 Annual Report on Form 10-K - There have been no material changes with respect to market risk disclosures since the 2022 Annual Report on Form 10-K[200](index=200&type=chunk) [Controls and Procedures](index=38&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded that disclosure controls and procedures were effective as of September 30, 2023, with no material changes to internal control over financial reporting - As of September 30, 2023, the company's disclosure controls and procedures were deemed effective by management[202](index=202&type=chunk) - No changes occurred during the quarter that have materially affected, or are reasonably likely to materially affect, the company's internal control over financial reporting[203](index=203&type=chunk) PART II — OTHER INFORMATION [Legal Proceedings](index=39&type=section&id=Item%201.%20Legal%20Proceedings) Information on legal proceedings, including the dispute with DSE over a $300 million milestone payment, is detailed in Note 5 of the financial statements - Information regarding legal proceedings is detailed in Note 5, "Commitments and Contingencies," of the financial statements[205](index=205&type=chunk) [Risk Factors](index=39&type=section&id=Item%201A.%20Risk%20Factors) New or materially changed risk factors include stock price volatility, potential delisting, delays in FDA/SEC reviews, DSE's failure to perform, and banking system instability - The company's common stock has experienced substantial price volatility and could be delisted from Nasdaq if it fails to meet continuing listing standards, such as the minimum price requirement[209](index=209&type=chunk) - A dispute with partner DSE over a **$300 million** milestone payment is highlighted as a risk. A failure to receive or delay in receiving milestone payments from partners could significantly impact future capital needs[212](index=212&type=chunk) - Inadequate funding or shutdowns of government agencies like the FDA and SEC could hinder their ability to review and approve new products or applications in a timely manner[210](index=210&type=chunk)[211](index=211&type=chunk) - Recent failures of banks and financial institutions pose a risk to the company's ability to access its cash, cash equivalents, and investments, which could adversely affect operations[217](index=217&type=chunk)[218](index=218&type=chunk) [Exhibits](index=42&type=section&id=Item%206.%20Exhibits) This section provides an index of all exhibits filed with the report, including corporate governance documents and required CEO/CFO certifications - The Exhibit Index lists all documents filed with the report, including corporate governance documents and required CEO/CFO certifications[220](index=220&type=chunk)[222](index=222&type=chunk)

Financial Data and Key Metrics Changes - Total revenue for Q2 2023 was $25.8 million, a 37% increase year-over-year [4][34] - U.S. revenue reached $20.3 million, reflecting a 49% year-over-year growth [4][34] - Retail prescription equivalents (RPE) grew 26% year-over-year and 16% quarter-over-quarter [33] - Cash, cash equivalents, and investment securities totaled $138.5 million as of June 30, 2023, down from $166.9 million on December 31, 2022 [34] Business Line Data and Key Metrics Changes - Retail prescription equivalents from NEXLETOL and NEXLIZET increased by 26% year-over-year [13] - New-to-brand prescriptions grew by 60% from ACC presentation to the end of June [13] - Collaboration revenue, including royalties and partner revenue, was $5.5 million, a 4% increase year-over-year [34] Market Data and Key Metrics Changes - In Europe, 123,000 patients have been treated with the therapies, representing a 26% growth since February [22] - The total addressable patient population in the U.S. is expected to increase to approximately 70 million following label expansion [19] Company Strategy and Development Direction - The company is focused on expanding its label to include a broader cardiovascular risk reduction indication [8][19] - A strategic approach is being employed to present relevant analyses to target different segments of the population [14] - The company anticipates significant growth following label expansion and full commercial launch in mid-2024 [27] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in achieving blockbuster status for NEXLETOL and NEXLIZET, emphasizing the potential to reach more patients [20][38] - Positive feedback from payers has been received, with over 80% of U.S. pharmacy lives represented in discussions [16] - The company is preparing for a significant sales inflection post-label expansion [26] Other Important Information - R&D expenses for Q2 were $22.1 million, a decrease of 32% year-over-year [57] - SG&A expenses were $34 million, an increase of 15% year-over-year, reflecting upfront training costs and higher legal costs [57] - The company has sufficient cash runway through mid-2024, which aligns with expected regulatory approvals [35] Q&A Session Summary Question: What is the status of the April 2024 trial date? - Management expressed confidence that the trial date is set and that they expect a favorable outcome [64][70] Question: How are prescription volumes impacting gross to net? - Management indicated that gross to net has been stable, with increased volumes expected to improve it over the next one to two years [71] Question: Where are the increases in prescriptions coming from? - Increases are seen in both depth and breadth among current prescribers, with a balanced split between primary care and cardiology [74] Question: What is the current status of reimbursement dynamics? - There has been an increase in prior authorization approval rates, with efforts focused on educating offices about the process [106] Question: How is the detailing process being affected by the current label? - The sales team is focusing on the current strategy, with increases attributed to clinician appreciation for the data despite the label not being updated [103]

REACHING GOALS Retail Prescription Equivalents Y/Y • Acceptance of two late-breaker presentations at European Society of Cardiology 2023 in August CVOT © 2023 Esperion. All Rights Reserved – Do not copy or distribute. 7 © 2023 Esperion. All Rights Reserved – Do not copy or distribute. • Primary hyperlipidemia Forward-looking Statements & Disclosures © 2023 Esperion. All Rights Reserved – Do not copy or distribute. Business Update Sheldon Koenig, President and CEO $26M 4 Total Revenue +37% Y/Y +26% Robust Da ...

[PART I — FINANCIAL INFORMATION](index=2&type=section&id=PART%20I%20%E2%80%94%20FINANCIAL%20INFORMATION) This section provides Esperion Therapeutics, Inc.'s unaudited condensed financial statements and management's discussion and analysis [Item 1. Financial Statements](index=3&type=section&id=Item%201.%20Financial%20Statements) This section presents Esperion Therapeutics, Inc.'s unaudited condensed financial statements for the periods ended June 30, 2023, and December 31, 2022, including balance sheets, statements of operations and comprehensive loss, statements of stockholders' deficit, and statements of cash flows, along with detailed notes explaining significant accounting policies, collaboration agreements, commitments, and other financial details [Condensed Balance Sheets](index=3&type=section&id=Condensed%20Balance%20Sheets) This section presents the company's financial position, including assets, liabilities, and stockholders' deficit, as of June 30, 2023, and December 31, 2022 | (in thousands) | June 30, 2023 (unaudited) | December 31, 2022 | | :--------------------------------- | :-------------------------- | :------------------ | | **Assets** | | | | Cash and cash equivalents | $138,470 | $124,775 | | Short-term investments | — | $42,086 | | Accounts receivable | $40,799 | $33,729 | | Inventories, net | $45,676 | $35,201 | | Total current assets | $232,125 | $246,683 | | Total assets | $234,626 | $247,939 | | **Liabilities and stockholders' equity** | | | | Total current liabilities | $107,173 | $92,308 | | Convertible notes, net | $260,738 | $259,899 | | Revenue interest liability | $236,990 | $218,845 | | Total liabilities | $606,604 | $571,717 | | Total stockholders' deficit | $(371,978) | $(323,778) | [Condensed Statements of Operations and Comprehensive Loss](index=4&type=section&id=Condensed%20Statements%20of%20Operations%20and%20Comprehensive%20Loss) This section details the company's revenues, operating expenses, and net loss for the three and six months ended June 30, 2023, and 2022 | (in thousands, except share and per share data) | Three Months Ended June 30, 2023 | Three Months Ended June 30, 2022 | Six Months Ended June 30, 2023 | Six Months Ended June 30, 2022 | | :---------------------------------------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | **Revenues:** | | | | | | Product sales, net | $20,293 | $13,578 | $37,324 | $26,932 | | Collaboration revenue | $5,493 | $5,263 | $12,791 | $10,745 | | **Total Revenues** | **$25,786** | **$18,841** | **$50,115** | **$37,677** | | **Operating expenses:** | | | | | | Cost of goods sold | $6,786 | $9,176 | $18,438 | $16,301 | | Research and development | $22,099 | $32,432 | $53,480 | $56,751 | | Selling, general and administrative | $33,959 | $29,609 | $63,860 | $59,990 | | **Total operating expenses** | **$62,844** | **$71,217** | **$135,778** | **$133,042** | | Loss from operations | $(37,058) | $(52,376) | $(85,663) | $(95,365) | | Interest expense | $(14,537) | $(14,266) | $(28,924) | $(28,328) | | Other income, net | $1,660 | $318 | $2,933 | $638 | | **Net loss** | **$(49,935)** | **$(66,324)** | **$(111,654)** | **$(123,055)** | | Net loss per common share - basic and diluted | $(0.46) | $(1.05) | $(1.19) | $(1.98) | [Condensed Statements of Stockholders' Deficit](index=5&type=section&id=Condensed%20Statements%20of%20Stockholders'%20Deficit) This section outlines changes in the company's stockholders' deficit, including common stock, additional paid-in capital, and accumulated deficit, for the six months ended June 30, 2023 - Total stockholders' deficit increased from **$(323,778) thousand** at December 31, 2022, to **$(371,978) thousand** at June 30, 2023, primarily due to a net loss of **$(49,935) thousand** for the quarter[8](index=8&type=chunk)[13](index=13&type=chunk) - Common stock shares issued increased significantly from **74,570,198** at December 31, 2022, to **100,870,527** at June 30, 2023, driven by issuance of common stock, warrants, and pre-funded warrants (**12,205,000 shares**), ATM program issuances (**3,312,908 shares**), and exercise of pre-funded warrants (**10,098,747 shares**)[13](index=13&type=chunk) - Additional paid-in capital increased from **$1,071,183 thousand** to **$1,134,609 thousand**, reflecting proceeds from stock issuances and stock-based compensation[13](index=13&type=chunk) [Condensed Statements of Cash Flows](index=6&type=section&id=Condensed%20Statements%20of%20Cash%20Flows) This section summarizes the company's cash inflows and outflows from operating, investing, and financing activities for the six months ended June 30, 2023, and 2022 | (in thousands) | Six Months Ended June 30, 2023 | Six Months Ended June 30, 2022 | | :----------------------------------------- | :----------------------------- | :----------------------------- | | Net cash used in operating activities | $(79,106) | $(89,522) | | Net cash provided by (used in) investing activities | $42,500 | $(13,102) | | Net cash provided by financing activities | $50,301 | $16,672 | | Net increase (decrease) in cash and cash equivalents | $13,695 | $(85,952) | | Cash, cash equivalents and restricted cash at end of period | $138,470 | $172,940 | [Notes to Condensed Financial Statements](index=7&type=section&id=Notes%20to%20Condensed%20Financial%20Statements) This section provides detailed explanations and disclosures for the financial statements, covering accounting policies, collaboration agreements, and other financial details [1. The Company and Basis of Presentation](index=7&type=section&id=1.%20The%20Company%20and%20Basis%20of%20Presentation) This section describes Esperion Therapeutics, Inc.'s business, product approvals, key clinical trial results, and ongoing financial condition - Esperion Therapeutics, Inc. is a pharmaceutical company focused on developing and commercializing oral, once-daily, non-statin medicines for elevated LDL-C, with two FDA/EMA/Swissmedic approved products (Bempedoic acid and Bempedoic acid/Ezetimibe combination tablet) since 2020[17](index=17&type=chunk) - The CLEAR Outcomes trial met its primary endpoint on December 7, 2022, demonstrating significant cardiovascular risk reductions with bempedoic acid, including reduced risk of heart attack and coronary revascularization, making it the first LDL-C lowering therapy since statins proven to lower hard ischemic events in both ASCVD and primary prevention patients[18](index=18&type=chunk)[19](index=19&type=chunk) - The Company submitted Supplemental New Drug Applications (sNDAs) to the FDA and a Type II(a) variation to the EMA in June 2023, seeking approval to add cardiovascular risk reduction indications and remove statin limitations for NEXLETOL/NEXLIZET (NILEMDO/NUSTENDI in Europe), with anticipated approvals in the first half of 2024[21](index=21&type=chunk)[22](index=22&type=chunk) - Esperion has sustained annual operating losses since inception and expects them to continue, relying on current cash, product sales, and collaboration agreements to fund operations, while also exploring additional financing options[24](index=24&type=chunk)[25](index=25&type=chunk) [2. Summary of Significant Accounting Policies](index=8&type=section&id=2.%20Summary%20of%20Significant%20Accounting%20Policies) This section outlines the key accounting principles and methods used in preparing the financial statements, including revenue recognition and inventory valuation - Revenue is recognized when a customer obtains control of promised goods or services, reflecting the expected consideration. The Company derives revenue from collaboration agreements (royalties, supply of bulk tablets) and direct product sales (NEXLETOL and NEXLIZET in the U.S.)[32](index=32&type=chunk)[39](index=39&type=chunk) - Product sales are recorded net of variable consideration, including estimates for rebates, chargebacks, co-pay assistance, distribution fees, product returns, and other discounts, with reserves established for these items[41](index=41&type=chunk)[42](index=42&type=chunk) - Inventories are stated at the lower of cost or net realizable value using the FIFO method, with adjustments for expiration risk or cost exceeding net realizable value recognized in cost of goods sold[48](index=48&type=chunk)[49](index=49&type=chunk) [3. Collaborations with Third Parties](index=11&type=section&id=3.%20Collaborations%20with%20Third%20Parties) This section details the company's agreements with DSE, Otsuka, and Daiichi Sankyo for product development, manufacturing, and commercialization - The Company has collaboration agreements with DSE (Europe, Turkey, Switzerland), Otsuka (Japan), and Daiichi Sankyo Co. Ltd (South Korea, Taiwan, Hong Kong, Thailand, Vietnam, Brazil, Macao, Cambodia, Myanmar) for development, manufacturing, and commercialization of its products[51](index=51&type=chunk)[57](index=57&type=chunk)[62](index=62&type=chunk) | Collaboration Partner | Period | Collaboration Revenue (in thousands) | | :-------------------- | :----- | :--------------------------------- | | DSE | 3 months ended June 30, 2023 | $5,300 | | DSE | 6 months ended June 30, 2023 | $12,400 | | DSE | 3 months ended June 30, 2022 | $5,000 | | DSE | 6 months ended June 30, 2022 | $10,300 | | DS | 3 months ended June 30, 2023 | $200 | | DS | 6 months ended June 30, 2023 | $400 | | DS | 3 months ended June 30, 2022 | $200 | | DS | 6 months ended June 30, 2022 | $400 | - Future potential milestone payments from collaboration agreements are constrained and not included in the transaction price, as they depend on development activities, regulatory approvals, and sales-based milestones[55](index=55&type=chunk)[56](index=56&type=chunk)[60](index=60&type=chunk)[61](index=61&type=chunk)[65](index=65&type=chunk) [4. Inventories, net](index=13&type=section&id=4.%20Inventories,%20net) This section provides a breakdown of the company's inventory components, including raw materials, work in process, and finished goods | (in thousands) | June 30, 2023 | December 31, 2022 | | :------------- | :------------ | :---------------- | | Raw materials | $43,755 | $26,558 | | Work in process | $1,007 | $6,548 | | Finished goods | $914 | $2,095 | | Total | $45,676 | $35,201 | [5. Commitments and Contingencies](index=13&type=section&id=5.%20Commitments%20and%20Contingencies) This section discusses the company's potential obligations and legal disputes, particularly regarding a $300 million milestone payment from DSE - The Company believes it is entitled to a **$300 million** milestone payment from DSE upon inclusion of cardiovascular risk reduction data in the EU label, based on CLEAR Outcomes data showing a relative risk reduction rate equal to or greater than **20%**[67](index=67&type=chunk) - DSE disputes the Company's assessment regarding the milestone payment, leading Esperion to file a complaint in the U.S. District Court for the Southern District of New York on March 27, 2023, seeking a judicial declaration for the **$300 million** payment[68](index=68&type=chunk)[69](index=69&type=chunk)[70](index=70&type=chunk) - Any delay or failure to receive the DSE milestone payment could significantly impact the Company's future capital needs, revenue recognition, and ability to fund operations[68](index=68&type=chunk) [6. Investments](index=14&type=section&id=6.%20Investments) This section details the company's investment portfolio, including money market funds, certificates of deposit, and U.S. treasury notes, and related interest income | (in thousands) | June 30, 2023 Fair Value | December 31, 2022 Fair Value | | :--------------- | :----------------------- | :--------------------------- | | Money market funds | $112,110 | $105,078 | | Certificates of deposit | $401 | $401 | | U.S. treasury notes | — | $47,081 | | Total | $112,511 | $152,560 | - Other income, net, included interest income on investments of **$1.4 million** and **$2.3 million** for the three and six months ended June 30, 2023, respectively, a significant increase from **$0.4 million** and **$0.7 million** in the prior year periods, primarily due to higher interest rates[72](index=72&type=chunk) [7. Fair Value Measurements](index=14&type=section&id=7.%20Fair%20Value%20Measurements) This section explains the valuation methods used for financial assets measured at fair value, primarily money market funds and certificates of deposit - The Company's financial assets measured at fair value on a recurring basis, primarily money market funds and certificates of deposit, are classified as **Level 1 inputs**, indicating they are valued using quoted prices in active markets for identical assets[75](index=75&type=chunk)[76](index=76&type=chunk) | (in thousands) | June 30, 2023 Total Fair Value | December 31, 2022 Total Fair Value | | :--------------- | :----------------------------- | :--------------------------------- | | Money market funds | $112,110 | $105,078 | | Certificates of deposit | $401 | $401 | | U.S. treasury notes | — | $47,081 | | Total assets at fair value | $112,511 | $152,560 | [8. Liability Related to the Revenue Interest Purchase Agreement](index=15&type=section&id=8.%20Liability%20Related%20to%20the%20Revenue%20Interest%20Purchase%20Agreement) This section describes the company's agreement with Oberland, outlining the revenue interest liability and associated interest expense - The Company has a Revenue Interest Purchase Agreement (RIPA) with Oberland, under which it received **$125.0 million** at closing in 2019, an additional **$25.0 million** in 2020, and a final **$50.0 million** in April 2021, for a total of **$200.0 million**[77](index=77&type=chunk)[81](index=81&type=chunk) - As consideration, Oberland receives tiered revenue interests ranging from **3.33% to 10%** of the Company's net sales in the Covered Territory (worldwide since 2022), until **225%** of the aggregate purchase price (**$400 million**) is repaid[78](index=78&type=chunk)[81](index=81&type=chunk)[87](index=87&type=chunk)[89](index=89&type=chunk) - The revenue interest liability was **$259.8 million** as of June 30, 2023, with an effective annual imputed interest rate of **18.1%**. Interest expense related to this liability was **$11.5 million** and **$22.8 million** for the three and six months ended June 30, 2023, respectively[87](index=87&type=chunk)[88](index=88&type=chunk)[90](index=90&type=chunk) | (in thousands) | Amount | | :------------------------------------ | :----- | | Total revenue interest liability at December 31, 2022 | $243,605 | | Interest expense recognized | $22,785 | | Revenue Interests payments | $(6,616) | | Total revenue interest liability at June 30, 2023 | $259,774 | [9. Convertible Notes](index=17&type=section&id=9.%20Convertible%20Notes) This section details the company's 4.0% senior subordinated convertible notes due November 2025, including their carrying amount, interest expense, and fair value - In November 2020, the Company issued **$280.0 million** aggregate principal amount of **4.0%** senior subordinated convertible notes due November 2025, with a net carrying amount of **$260.7 million** as of June 30, 2023[92](index=92&type=chunk)[100](index=100&type=chunk) - Interest expense on convertible notes was **$3.0 million** and **$6.1 million** for the three and six months ended June 30, 2023, respectively. The estimated fair value of the Convertible Notes was **$133.3 million** as of June 30, 2023[101](index=101&type=chunk)[102](index=102&type=chunk) - The Company entered into capped call transactions (**$46.0 million** cost) to reduce potential dilution from conversion and a prepaid forward stock repurchase transaction (**$55.0 million** cost) for **1,994,198 shares**, treated as treasury stock[103](index=103&type=chunk)[105](index=105&type=chunk) [10. Other Accrued Liabilities](index=19&type=section&id=10.%20Other%20Accrued%20Liabilities) This section provides a breakdown of various accrued liabilities, including compensation, professional fees, and interest on convertible notes | (in thousands) | June 30, 2023 | December 31, 2022 | | :--------------- | :------------ | :---------------- | | Accrued compensation | $6,987 | $9,053 | | Accrued professional fees | $4,494 | $2,547 | | Accrued interest on convertible notes | $1,325 | $1,325 | | Accrued other | $45 | $279 | | Total other accrued liabilities | $12,851 | $13,204 | [11. Stock Compensation](index=20&type=section&id=11.%20Stock%20Compensation) This section outlines the company's stock option and incentive plans, employee stock purchase plan, and associated stock-based compensation expenses - The 2022 Stock Option and Incentive Plan was approved in May 2022, with an amendment in June 2023 increasing reserved shares to **10,650,000**. The Employee Stock Purchase Plan (ESPP) allows eligible employees to purchase shares at a discount[107](index=107&type=chunk)[108](index=108&type=chunk) | Stock-Based Compensation Expense (in thousands) | Three Months Ended June 30, 2023 | Six Months Ended June 30, 2023 | Three Months Ended June 30, 2022 | Six Months Ended June 30, 2022 | | :---------------------------------------------- | :------------------------------- | :----------------------------- | :------------------------------- | :----------------------------- | | ESPP | $100 | $200 | $100 | $200 | | Stock Options | $1,000 | $2,000 | $1,400 | $2,900 | | Performance-Based Stock Options (PBSOs) | $200 | $400 | $100 | $200 | | Restricted Stock Units (RSUs) | $1,800 | $3,300 | $1,700 | $3,600 | | Performance-based Restricted Stock Units (PBRSUs) | $100 | $200 | $300 | $1,100 | - As of June 30, 2023, unrecognized stock-based compensation expense totaled **$8.3 million** for unvested options (over **2.7 years**), **$0.8 million** for unvested PBSOs (over **1.0 years**), and **$16.7 million** for unvested RSUs (over **2.8 years**), and **$0.6 million** for unvested PBRSUs (over **1.0 years**)[109](index=109&type=chunk)[112](index=112&type=chunk)[113](index=113&type=chunk)[115](index=115&type=chunk) [12. Income Taxes](index=22&type=section&id=12.%20Income%20Taxes) This section explains the company's income tax position, noting no provision for income taxes due to historical operating losses and a full valuation allowance - No provision for income taxes was recorded for the three and six months ended June 30, 2023 and 2022, due to the Company's history of annual operating losses since inception. A full valuation allowance has been applied against net deferred tax assets[116](index=116&type=chunk) [13. Stockholders' Deficit](index=23&type=section&id=13.%20Stockholders'%20Deficit) This section details changes in the company's equity, including common stock issuances, warrants, and pre-funded warrants from various offerings - The Company issued **3,312,908 shares** of common stock through its 2023 ATM Program, generating net proceeds of approximately **$4.4 million** for the six months ended June 30, 2023[118](index=118&type=chunk) - A registered direct offering closed on March 22, 2023, issuing **12,205,000 shares** of common stock, **20,965,747** pre-funded warrants, and **33,170,747** warrants, generating net proceeds of approximately **$51.3 million**. Existing warrants were also amended, reducing their exercise price to **$1.55** and extending expiration to September 22, 2026, for an additional **$1.1 million** net proceeds[120](index=120&type=chunk)[121](index=121&type=chunk)[122](index=122&type=chunk)[123](index=123&type=chunk) | Warrants and Pre-funded Warrants Outstanding | June 30, 2023 | December 31, 2022 | Weighted-average exercise price | | :------------------------------------------- | :------------ | :---------------- | :------------------------------ | | Warrants from 2021 agreement | 27,940,074 | 36,964,286 | $9.00 | | Warrants from Warrant Amendment Agreements | 9,024,212 | — | $1.55 | | Warrants from Purchase Agreement | 33,170,747 | — | $1.55 | | Pre-funded warrants outstanding | 10,867,000 | — | $0.001 | | Total | 81,002,033 | 36,964,286 | | [14. Net Loss Per Common Share](index=24&type=section&id=14.%20Net%20Loss%20Per%20Common%20Share) This section presents the basic and diluted net loss per common share and discusses potential dilutive shares excluded from calculations - Basic and diluted net loss per common share was **$(0.46)** and **$(1.19)** for the three and six months ended June 30, 2023, respectively, an improvement from **$(1.05)** and **$(1.98)** for the same periods in 2022[10](index=10&type=chunk) - A significant number of potential dilutive shares, including common shares under option, PBSOs, unvested RSUs and PBRSUs, ESPP shares, convertible notes, and warrants, were excluded from diluted EPS calculation due to their anti-dilutive effect, totaling **86,332,196 shares** as of June 30, 2023[125](index=125&type=chunk)[126](index=126&type=chunk) [15. Statements of Cash Flows and Restricted Cash](index=25&type=section&id=15.%20Statements%20of%20Cash%20Flows%20and%20Restricted%20Cash) This section provides a reconciliation of cash, cash equivalents, and restricted cash at different reporting periods | (in thousands) | June 30, 2023 | June 30, 2022 | December 31, 2022 | December 31, 2021 | | :--------------- | :------------ | :------------ | :---------------- | :---------------- | | Cash and cash equivalents | $138,470 | $122,940 | $124,775 | $208,892 | | Restricted cash | — | $50,000 | — | $50,000 | | Total cash and cash equivalents and restricted cash | $138,470 | $172,940 | $124,775 | $258,892 | [16. Subsequent Events](index=25&type=section&id=16.%20Subsequent%20Events) This section discloses significant events that occurred after the reporting period, such as the termination of a licensing agreement - On July 6, 2023, the Company provided notice to Serometrix of its intent to terminate the licensing agreement related to its oral, small molecule PCSK9 inhibitor program, effective August 5, 2023, while continuing to advance internal pipeline assets[128](index=128&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=26&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) This section provides management's perspective on the Company's financial condition and results of operations, highlighting key business developments, product performance, and financial trends for the three and six months ended June 30, 2023, compared to the prior year. It also discusses liquidity, capital resources, and future funding requirements [Forward-Looking Statements](index=26&type=section&id=Forward-Looking%20Statements) This section cautions readers about statements regarding future events, emphasizing inherent risks and uncertainties that could cause actual results to differ materially - The report contains forward-looking statements regarding clinical development, commercialization plans, future financial performance, and potential expanded indications for bempedoic acid and its combination tablet, which are subject to known and unknown risks and uncertainties[131](index=131&type=chunk)[132](index=132&type=chunk) - Readers are cautioned not to place undue reliance on these statements, as actual results may differ materially due to various factors, including those discussed in the 'Risk Factors' section[132](index=132&type=chunk) [Overview](index=26&type=section&id=Overview) This section provides a high-level summary of the company's business, product portfolio, key clinical trial outcomes, and financial performance [Corporate Overview](index=26&type=section&id=Corporate%20Overview) This section introduces Esperion's core business, product approvals, significant clinical trial results, and ongoing financial challenges - Esperion is a pharmaceutical company focused on non-statin medicines for elevated LDL-C, with FDA/EMA/Swissmedic approved products NEXLETOL and NEXLIZET (NILEMDO and NUSTENDI in Europe) since 2020[135](index=135&type=chunk) - The CLEAR Outcomes trial successfully met its primary endpoint on December 7, 2022, demonstrating significant cardiovascular risk reductions with bempedoic acid, including reduced risk of heart attack and coronary revascularization[136](index=136&type=chunk)[137](index=137&type=chunk)[138](index=138&type=chunk) - The Company submitted sNDAs to the FDA and a Type II(a) variation to the EMA in June 2023 for cardiovascular risk reduction indications and removal of statin limitations, with anticipated approvals in the first half of 2024[140](index=140&type=chunk) - Esperion is in a dispute with DSE regarding a **$300 million** milestone payment related to the EU label inclusion of cardiovascular risk reduction data, having filed a complaint seeking judicial declaration[141](index=141&type=chunk)[142](index=142&type=chunk) - The Company has incurred significant operating losses since inception (**$49.9 million** and **$111.7 million** for the three and six months ended June 30, 2023, respectively) and expects these losses to continue due to ongoing commercialization and R&D activities, necessitating potential additional financing[145](index=145&type=chunk)[146](index=146&type=chunk) [Product Overview](index=28&type=section&id=Product%20Overview) This section describes the company's key pharmaceutical products, NEXLETOL and NEXLIZET, including their mechanisms of action and approved indications - NEXLETOL (bempedoic acid) is a first-in-class ATP Citrate Lyase (ACL) inhibitor, approved by the FDA in February 2020, that lowers LDL-C by an average of **18%** when used with statins[147](index=147&type=chunk) - NEXLIZET (bempedoic acid and ezetimibe) combines two complementary mechanisms to lower LDL-C by a mean of **38%** compared to placebo when added to maximally tolerated statins, also approved by the FDA in February 2020[148](index=148&type=chunk) - NILEMDO (bempedoic acid) and NUSTENDI (bempedoic acid and ezetimibe) are the European equivalents, approved by the EC in March 2020 for primary hypercholesterolemia or mixed dyslipidemia, with specific indications for use with statins or in statin-intolerant patients[149](index=149&type=chunk)[150](index=150&type=chunk) [Financial Operations Overview](index=29&type=section&id=Financial%20Operations%20Overview) This section explains the primary components of the company's revenues and expenses, providing context for financial performance [Product sales, net](index=29&type=section&id=Product%20sales,%20net) This section focuses on the revenue generated from the commercialization of NEXLETOL and NEXLIZET in the U.S - Product sales, net, are derived from the commercialization of NEXLETOL and NEXLIZET in the U.S., which became commercially available in March and June 2020, respectively[152](index=152&type=chunk) [Collaboration revenue](index=29&type=section&id=Collaboration%20revenue) This section details income derived from agreements with third-party partners, including royalties and bulk tablet sales - Collaboration revenue primarily stems from agreements with DSE, Otsuka, and DS, including royalties from product commercialization and sales of bulk tablets under supply agreements to partners[153](index=153&type=chunk) [Cost of goods sold](index=29&type=section&id=Cost%20of%20goods%20sold) This section outlines the direct costs associated with the production and sale of NEXLETOL and NEXLIZET, and supply agreements - Cost of goods sold relates to net product sales of NEXLETOL and NEXLIZET, as well as costs associated with supply agreements with collaboration partners[154](index=154&type=chunk) [Research and Development Expenses](index=29&type=section&id=Research%20and%20Development%20Expenses) This section covers the costs incurred for developing bempedoic acid and its combination tablet, including clinical studies and regulatory activities - R&D expenses primarily cover costs for developing bempedoic acid and its combination tablet, including clinical studies, manufacturing materials, employee-related expenses, and regulatory compliance[155](index=155&type=chunk) - R&D expenses are expected to decrease in the second half of 2023 following the reporting of CLEAR Outcomes CVOT results and regulatory submissions to the FDA and EMA in the first half of 2023[156](index=156&type=chunk)[157](index=157&type=chunk) [Selling, General and Administrative Expenses](index=31&type=section&id=Selling,%20General%20and%20Administrative%20Expenses) This section describes the non-research and development costs related to sales, marketing, and overall corporate administration - SG&A expenses include salaries, stock-based compensation, facility costs, communication expenses, and professional fees for sales, executive, accounting, commercial, and administrative functions[158](index=158&type=chunk) - SG&A expenses are anticipated to increase at the end of 2023 due to potential additional global regulatory approvals for new product indications, expanded commercialization initiatives, and increased headcount[159](index=159&type=chunk) [Interest Expense](index=31&type=section&id=Interest%20Expense) This section explains the costs associated with the company's debt obligations, including the Revenue Interest Purchase Agreement and convertible notes - Interest expense is primarily associated with the Revenue Interest Purchase Agreement (RIPA) with Oberland and the convertible notes issued in November 2020[160](index=160&type=chunk) [Other Income, Net](index=31&type=section&id=Other%20Income,%20Net) This section summarizes miscellaneous non-operating income, primarily from interest on investments and sale of lease vehicles - Other income, net, mainly consists of interest income and the accretion or amortization of premiums and discounts on cash, cash equivalents, and investment securities, as well as income from the sale of lease vehicles[161](index=161&type=chunk) [Critical Accounting Policies and Significant Judgments and Estimates](index=31&type=section&id=Critical%20Accounting%20Policies%20and%20Significant%20Judgments%20and%20Estimates) This section discusses the key accounting policies and the significant management judgments and estimates used in preparing the financial statements - The preparation of financial statements requires management to make estimates and assumptions affecting reported amounts, which are evaluated on an ongoing basis using historical experience, trends, and contractual milestones[162](index=162&type=chunk) - There have been no material changes to the significant accounting policies previously disclosed in the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 2022[163](index=163&type=chunk) [Results of Operations](index=32&type=section&id=Results%20of%20Operations) This section provides a comparative analysis of the company's financial performance across different reporting periods [Comparison of the Three Months Ended June 30, 2023 and 2022](index=32&type=section&id=Comparison%20of%20the%20Three%20Months%20Ended%20June%2030,%202023%20and%202022) This section analyzes the financial performance for the recent three-month period, highlighting changes in revenues, expenses, and net loss | (in thousands) | Three Months Ended June 30, 2023 | Three Months Ended June 30, 2022 | Change | | :-------------------------------- | :------------------------------- | :------------------------------- | :----- | | Product sales, net | $20,293 | $13,578 | $6,715 | | Collaboration revenue | $5,493 | $5,263 | $230 | | Cost of goods sold | $6,786 | $9,176 | $(2,390) | | Research and development | $22,099 | $32,432 | $(10,333) | | Selling, general and administrative | $33,959 | $29,609 | $4,350 | | Net loss | $(49,935) | $(66,324) | $16,389 | - Net product sales increased by **$6.7 million** (**49.5%**) to **$20.3 million**, primarily due to prescription growth of NEXLETOL and NEXLIZET[166](index=166&type=chunk) - Research and development expenses decreased by **$10.3 million** (**31.8%**) to **$22.1 million**, mainly due to reduced costs for the CLEAR Outcomes study close-out activities and regulatory submissions[169](index=169&type=chunk) - Selling, general and administrative expenses increased by **$4.4 million** (**14.7%**) to **$34.0 million**, driven by upfront training for the contract sales force and increased legal costs[170](index=170&type=chunk) [Comparison of the Six Months Ended June 30, 2023 and 2022](index=33&type=section&id=Comparison%20of%20the%20Six%20Months%20Ended%20June%2030,%202023%20and%202022) This section analyzes the financial performance for the recent six-month period, detailing changes in revenues, expenses, and net loss | (in thousands) | Six Months Ended June 30, 2023 | Six Months Ended June 30, 2022 | Change | | :-------------------------------- | :----------------------------- | :----------------------------- | :----- | | Product sales, net | $37,324 | $26,932 | $10,392 | | Collaboration revenue | $12,791 | $10,745 | $2,046 | | Cost of goods sold | $18,438 | $16,301 | $2,137 | | Research and development | $53,480 | $56,751 | $(3,271) | | Selling, general and administrative | $63,860 | $59,990 | $3,870 | | Net loss | $(111,654) | $(123,055) | $11,401 | - Net product sales increased by **$10.4 million** (**38.6%**) to **$37.3 million**, primarily due to prescription growth of NEXLETOL and NEXLIZET[174](index=174&type=chunk) - Collaboration revenue increased by **$2.1 million** (**19.0%**) to **$12.8 million**, mainly due to increased royalty sales growth within partner territories[175](index=175&type=chunk) - Research and development expenses decreased by **$3.3 million** (**5.8%**) to **$53.5 million**, primarily due to reduced costs related to the CLEAR Outcomes study following its announcement and presentation[177](index=177&type=chunk) [Liquidity and Capital Resources](index=34&type=section&id=Liquidity%20and%20Capital%20Resources) This section assesses the company's ability to generate and manage cash, covering operating, investing, and financing activities, and future funding needs [Operating Activities](index=35&type=section&id=Operating%20Activities) This section details the cash flows generated or used by the company's primary business operations - Net cash used in operating activities decreased to **$79.1 million** for the six months ended June 30, 2023, from **$89.5 million** in the prior year, primarily due to lower net losses and changes in working capital[184](index=184&type=chunk)[186](index=186&type=chunk) [Investing Activities](index=35&type=section&id=Investing%20Activities) This section summarizes the cash flows resulting from the purchase and sale of long-term assets and investments - Net cash provided by investing activities was **$42.5 million** for the six months ended June 30, 2023, compared to net cash used of **$13.1 million** in the prior year, driven by proceeds from sales of highly liquid investments[184](index=184&type=chunk)[187](index=187&type=chunk) [Financing Activities](index=35&type=section&id=Financing%20Activities) This section describes the cash flows related to debt, equity, and other financing transactions - Net cash provided by financing activities increased to **$50.3 million** for the six months ended June 30, 2023, from **$16.7 million** in the prior year, primarily due to proceeds from a registered direct offering and the 2023 ATM Program[184](index=184&type=chunk)[188](index=188&type=chunk) - The Company received approximately **$51.3 million** in net proceeds from a registered direct offering of common stock, pre-funded warrants, and warrants, and **$4.4 million** in net proceeds from the 2023 ATM Program during the six months ended June 30, 2023[189](index=189&type=chunk)[191](index=191&type=chunk) - The Company's Revenue Interest Purchase Agreement (RIPA) with Oberland involves tiered revenue interests (**3.3% to 10%**) on net sales, with future payments estimated at **$22.8 million** in the next year and a maximum total payment of **$358.7 million** beyond one year[192](index=192&type=chunk) [Plan of Operations and Funding Requirements](index=36&type=section&id=Plan%20of%20Operations%20and%20Funding%20Requirements) This section outlines the company's future operational strategies and anticipated capital needs, considering ongoing expenses and potential financing - The Company anticipates incurring significant expenses and operating losses for the foreseeable future due to ongoing commercialization of NEXLETOL and NEXLIZET and R&D activities[194](index=194&type=chunk) - Current cash, cash equivalents, investments, expected product sales, and collaboration revenues are deemed sufficient to fund operations for the foreseeable future, but additional capital may be needed if product sales do not meet expectations[194](index=194&type=chunk) - Future funding requirements are subject to numerous risks and uncertainties, including regulatory approvals, collaboration partner performance, intellectual property costs, and the timing of milestone payments, which could significantly impact capital needs[195](index=195&type=chunk)[196](index=196&type=chunk) [Item 3. Quantitative and Qualitative Disclosures About Market Risk](index=38&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) This section states that there have been no material changes to the Company's quantitative and qualitative disclosures about market risk since its Annual Report on Form 10-K for the fiscal year ended December 31, 2022 - No material changes have occurred regarding quantitative and qualitative disclosures about market risk since the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 2022[198](index=198&type=chunk) [Item 4. Controls and Procedures](index=38&type=section&id=Item%204.%20Controls%20and%20Procedures) This section details the Company's evaluation of its disclosure controls and procedures and reports on any changes in internal control over financial reporting [Evaluation of Disclosure Controls and Procedures](index=38&type=section&id=Evaluation%20of%20Disclosure%20Controls%20and%20Procedures) This section confirms the effectiveness of the company's disclosure controls and procedures as of June 30, 2023 - As of June 30, 2023, management, with the participation of the principal executive officer and principal financial officer, concluded that the Company's disclosure controls and procedures were effective at the reasonable assurance level[200](index=200&type=chunk) [Changes in Internal Control over Financial Reporting](index=38&type=section&id=Changes%20in%20Internal%20Control%20over%20Financial%20Reporting) This section reports that no material changes occurred in the company's internal control over financial reporting during the reporting period - There were no changes to the Company's internal control over financial reporting during the period covered by this report that have materially affected, or are reasonably likely to materially affect, its internal control over financial reporting[201](index=201&type=chunk) [PART II — OTHER INFORMATION](index=39&type=section&id=PART%20II%20%E2%80%94%20OTHER%20INFORMATION) This section covers legal proceedings, risk factors, exhibits, and corporate signatures [Item 1. Legal Proceedings](index=39&type=section&id=Item%201.%20Legal%20Proceedings) This section refers to the legal proceedings detailed in Note 5 to the condensed financial statements, primarily concerning the dispute with DSE over a $300 million milestone payment - Information on legal proceedings is incorporated by reference from Note 5, 'Commitments and Contingencies,' in the condensed financial statements[203](index=203&type=chunk) - The Company may become party to future legal matters in the ordinary course of business, but does not anticipate a material adverse impact on its financial position, results of operations, or cash flows from their resolution[204](index=204&type=chunk) [Item 1A. Risk Factors](index=39&type=section&id=Item%201A.%20Risk%20Factors) This section outlines new or materially changed risk factors, emphasizing the potential negative impacts of collaborative partners failing to perform their obligations, particularly the ongoing dispute with DSE over a milestone payment, and the adverse effects of conditions in the banking system and financial markets on the Company's operations and financial results - A key risk factor is the potential for collaborative partners (DSE, Otsuka, DS) to terminate or fail to perform obligations, which could delay or terminate commercialization and milestone payments, as exemplified by the ongoing **$300 million** milestone payment dispute with DSE[207](index=207&type=chunk)[208](index=208&type=chunk) - The Company's inability to receive or delays in receiving milestone and royalty payments from collaboration partners could significantly impact future capital needs[208](index=208&type=chunk)[210](index=210&type=chunk) - Conditions in the banking system and financial markets, including bank failures, pose a risk to the Company's operations and financial results, potentially threatening access to existing cash, cash equivalents, and investments[212](index=212&type=chunk)[213](index=213&type=chunk)[214](index=214&type=chunk) [Item 6. Exhibits](index=42&type=section&id=Item%206.%20Exhibits) This section provides an index of exhibits filed or furnished as part of this Quarterly Report on Form 10-Q, including organizational documents, stock plans, and certifications - The Exhibit Index lists documents filed or furnished with the Quarterly Report on Form 10-Q, including amendments to the Certificate of Incorporation, the 2022 Stock Option and Incentive Plan, and certifications by executive officers[215](index=215&type=chunk)[217](index=217&type=chunk) [Signatures](index=44&type=section&id=Signatures) This section contains the duly authorized signatures of Esperion Therapeutics, Inc.'s President and Chief Executive Officer, and Chief Financial Officer, affirming the submission of the report - The report is signed by Sheldon L. Koenig, President and Chief Executive Officer, and Benjamin Halladay, Chief Financial Officer, on August 1, 2023[222](index=222&type=chunk)