Business Of Biotech

Funding Tips And Moving From R&D To Commercial With Madrigal Pharmaceuticals' Mardi Dier

• Ben Comer • Episode 279

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On this week's episode of the Business of Biotech, Mardi Dier, CFO at Madrigal Pharmaceuticals, talks about building relationships in investment banking and investor relations before moving into business development and becoming a chief financial officer. Mardi describes how drug companies transition from an R&D focus to commercializing products, how to read IPO windows and manage expectations, pricing new drugs, and balancing commercial efforts with pipeline renewal and maintenance. 

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Ben Comer:

Welcome back to the Business of Biotech. I'm your host, Ben Comer, Chief Editor at Life Science Leader, and today I'm speaking with Mardi Dier, Executive Vice President and Chief Financial Officer at Madrigal Pharmaceuticals, a company that received approval for Rezdiffra in March of 2024. The first drug approved for patients with MASH, formerly known as NAS, and MAG and Madrigal's first approved product. That approval came about a month after Marty joined the company, and I'm excited to speak with her today about her current and prior experiences in the life sciences industry, working with investors, raising capital, and driving growth as CFO and chief business officer, as well as how to transition an RD organization into a full-scale commercial enterprise. And finally, we'll end with her plans for the future. Marty, thank you so much for being here.

Mardi Dier:

Thanks for having me, Ben. Yeah, I'm really excited to touch all those topics and uh thank you for the invite.

Ben Comer:

Yes, absolutely. Um I want to start uh as we do with a little bit on your background. I I think you started off uh in-house in the life sciences industries as uh VP of investor relations at Chiron. And I wonder, you know, how, you know, maybe what your interest was uh in investor relations uh initially and you know what that first job was like.

Mardi Dier:

Yeah, well, actually that was part two of my career. The the first part of my career was um in public accounting and then almost a decade in investment banking. So I had, yeah, it's been a lot of years in my career so far. But uh so I I came out of undergrad with a biology degree, not really knowing which way I was gonna go. So I decided I'd learn about business. And that's what landed me at uh KPMG at the time, a big four accounting firm. So anyway, I got the um ABCs of business, uh, went to business school and then into investment banking for the next decade, where I kind of recircled back to um working with life sciences companies as an investment banker. Then I transitioned into investor relations. And that made um, you know, the story make a little bit more sense, which is I just spent almost a decade really working on Wall Street, uh understanding uh company growth, capital formation, but most importantly working with analysts and uh investors on the buy side. So going into Chiron Corporation, uh, for those listeners who remember Chiron, Chiron and Genentech were basically started at the same time in the Bay Area. Uh really high flyer at the time. I would say Genentech got the better of us, but Chiron at the time was a big biotech, one very few of them in existence, had over 3,000 employees and billions in revenues, um, multiple business units across the world, et cetera. So coming in to take my investment banking experience and coming in to do investor relations and into industry was a huge transition for me, but also in many ways felt natural. Like being on the other side of the table and talking to investors and analysts uh was a little bit humbling, but also I kind of know what they're looking for, right? So you could speak their language and you know, really try to harness the story of a growing biotech company trying to get bigger and you know, trying to drive value for shareholders. So super exciting.

Ben Comer:

Yeah. And so I guess give me a sense of how big of a crowd that is. And, you know, were you encountering people, you know, at at Chiron that you had previously met? I mean, there are a million different investment vehicles nowadays, but I mean, do you and you know, you talked about being able to speak the language, which uh I suspect is is really a really important skill in in managing and handling investors. But do you do you still find, I mean, even now that you're running into some of the same like big players in that space?

Mardi Dier:

That is very funny you asked that question. Um, you know, biotech was smaller back then. This was early 2000s. Um, still, you know, huge industry, don't get me wrong. Um, but there weren't as many companies, there weren't as many investors, there weren't as many funds, there weren't as many investment banks and analysts. Um, some of my closest professional friends are from that era, honestly.

Ben Comer:

Really?

Mardi Dier:

Um, and some of the investors, some of the big investors are still on Wall Street. Of course, we've had a lot of turnover over the over 20 years or 19 years. Um, but yeah, forming those relationships, and actually, it was kind of a theme I wanted throughout talking today, is relationships matter still. You know, you have always the transactional side of whatever you're doing in business, but the relationships and picking up the phone or getting feedback or knowing how to talk to someone across the table, the metaphoric uh table these days is super important. So, yes, I formed really deep relationships. Um, you know, we had 20, 25 um cell site analysts covering us. Um, and then all the big and all the big firms were investors at that time. So um, yeah, it was formative for me for sure.

Ben Comer:

And then after Chiron, you worked at Portola Pharmaceuticals beginning in 2006. Uh, so pretty early in the company's history. I I I want to say they were they launched in 2004, but correct me if I'm wrong about that. But you you helped take the company public uh and you were there through the 2020 acquisition by Alexion for over a billion dollars. Um, can you talk a little bit about your experience at Portolo and maybe first, you know, what what you learned from the IPO process, you know, during an economic uh downturn in 2007, 2008?

Mardi Dier:

Well, yeah, this is, I mean, we could talk all day about my 14 years at Portola. Um, it was, in a word, amazing, but there were a lot of twists and turns along the way. And so um in 2006, uh yes, in 2006, Chiron was sold to Novartis. So they had already owned about 50% of the company and they came in and took the other the remaining uh remaining uh piece of the company. So that was that was great. So Chiron is no more. So I was looking for a job and I really wanted to kind of package my experiences with accounting, investment banking, and investor relations at a big biotech at the time and become a CFO. And uh Portola was a venture-backed um high flyer company at the time, founded by um uh Charles Homsey and David Phillips in the cardiovascular space. Um we had a factor 10A inhibitor uh called Patrix of An. Um, and it was in the early stages. It had just completed, it just inlicensed the technology, and it was um just completed a phase one study going into phase two. So still early in the tenure, but the idea was bring in somebody who had familiarity with the street. So you get a theme there with Wall Street, the investors and analysts, and take the company public. So I got there late, late 2006, early 2007. Um, we had done, I believe we had done a series B already. That's correct. Um, and then it was, are we ready to go public? And 2007, as everyone remembers, I'm sure, was sort of the beginning of hmm, markets aren't so stable. We didn't know exactly what the fallout was gonna be, but markets weren't so stable. So maybe we should pivot and raise money privately until we have a better view of what was gonna go on in the public markets, which we did and we were successful. We ran we raised um a big Series C, um, what at the time was big. Uh rounds have gotten bigger uh in the last 10 years, but at the time it was quite big, it was $75 million. And um, we waited, we wanted to wait out the markets. What we didn't know was that the financial crisis was happening in 2007 became 2013 very difficult time for capital formation and particularly for biotech, which was really on the you know the far end of the risk spectrum, and people were not taking risk at that time. So super challenging to think about, hey, how are we going to raise enough money for this company? Uh, we're about to enter really big studies. These are cardiovascular, basically outcome studies, very large um studies that we needed to um fundraise around and um tackle these markets. Um, so this, I mean, it's really kind of a long story. We did do another financing. Somehow we were able to do it, find great investors. We did go um into the some of the sovereign wealth investors at the time, but had a great syndicate, raised another private round during that, I think it was 2009, at solid valuations. Um, and it was in 2013, we really started preparing for an IPO. Like we're we gotta open the market, right? The market, there have been no um biotech IPOs up until that time. There was that big almost six-year gap that companies were not being formed. Talk about innovation getting stifled during that period. But um we and Ironwood, I believe, at the time were the first to come out, biotech companies, to do an IPO post the financial crisis. And ours was in May or June, May of 2013. Um, and you just had to have realistic expectations, right? We still were able to do an up round. Um, we got great investor interest, um, you know, and the rest was kind of history. We really had a very successful tenure at Portola Building Value for the next seven years before we were sold to Alexion. Um, but the actual mechanics of the IPO was, you know, you get on a plane, you go city to city. This was pre-COVID. Everything was in person, you did hour-long meetings, you tell your story, tell your story, tell your story. We had raised money privately, so we had a good set of investors already who were going to come in, but it was very important to bring in new investors as well. And we really just, I, for lack of a better word, pounded the pavement and we got that deal done.

Ben Comer:

There are a lot of companies, small companies sitting on the sidelines right now, looking for that window to do an IPO. Um, and I don't know how close of a corollary there is to that six-year period that that you've been referencing, but were there any specific cues that you were kind of looking at or that you would look at today if you were in a similar position to say, all right, now it's time, you know, to and and you, you know, you referenced the fact that you know you and Ironwood were one of the first couple of companies out of the gate, which must have been a little scary, but uh, you know, what what I guess helped you decide to go ahead and do it and and thinking about today, you know, and those companies that are sitting on the sidelines, you know, what would you suggest that those leaders that those companies you know look to or think about, you know, before they take the plunge?

Mardi Dier:

Yeah, really good question. Um, if there was a specific answer, uh I mean I'd be here talking to your It'd be on a billboard, yeah. Yeah, yeah. It's a little bit more of a feel, but but a little bit more than that. I mean, obviously, um going back to those relationships you form, um, you're get you're you're keeping your ear to the ground on what's happening in the marketplace. You're working you at this point, you've selected your investment banks. You've probably had multi-year relationships with investment banks giving you the information, you know, like, you know, how are the markets? If an investment bank um is honest with you, there's times when it's just like we can't do it. This is not the right time to do it. You know, um, there's sort of you need for capital, there's patience. You know, we waited seven years. That was really a dry spell. I mean, that's a really long time. Um, and there's just if there's a will, there's a way, and you kind of put that all together and decide, okay, we're gonna go, we're gonna take a chance. It's an educated guess because you know where your investors stand, right? You keep talking to them. You can't pre-sell a deal. You can't say, hey, would you would you put participate in our IPO? That's not the way it works. But you have to understand they're interested. We're interested in your next milestone. We think there's a lot of value in the company. Um, you know, you control what you can control from the company standpoint. And that we haven't really talked about that, but you know, when you're coming out of a sort of a dark space like we have in post-COVID in terms of IPOs and what we did in the financial crisis, you know, opportunistic financings are far and few between. They're really more catalyst-driven. So the other, you know, decision, part of your rubric and making that decision is hey, we're in front of or right after key data that we think can drive value and get new investors' interest. That's what the company can control. Then you're keeping as a CFO or CEO or folks in charge of the IPO process. They're talking to all the outside vendors, like, is it possible? We want this to be possible. Okay, let's get ready. Let's try. And, you know, we did an exercise multiple times over the years getting ready for an IPO is like, okay, we'll get to this point. We'll spend this amount of money, you know, and then we'll have a decision point. We gated everything until we said, okay, we're we're doing it. Flip the switch, file that S1, and let's get on the road. Um, so so I mean, there's a lot in that answer. Um, but at the time there was a little bit of lock arms too. Like we knew our catalyst was coming up, but let's lock arms and get public. We need the liquidity and we want the capital um to raise after the IPO, et cetera, et cetera. So it just made a lot of time and it and it worked. And I guess I would say lastly, having reasonable expectations. The IPO is not the finish line.

Ben Comer:

Right.

Mardi Dier:

Right. It's the starting line in most, even though you've been slaving for years already. And at this point, it'd been almost 10 years at the company, you know, with a board that supported us through that period of time, um, and new investors coming in, but you you had to have reasonable expectations. Like the market's not wide open. It's not crazy, you know, 2020, 2021 uh type valuations. So you just had to manage expectations through the whole process.

Ben Comer:

Well, fast forwarding to the acquisition by Alexion, um, what what could you say about getting, I mean, helping to enable that acquisition to happen? I think this was uh almost a billion and a half dollars that Alexion paid uh for uh for Portola. You know, how do you think about that in terms of you know setting up the business uh to be ready uh for a deal like that? What what could you say there?

Mardi Dier:

Well, I mean, there's there's the biotech adage, of course, which uh biotech biotech companies are bought, not sold, right?

Ben Comer:

So you never you never prepare for You're not sitting around waiting for someone to call.

Mardi Dier:

Yeah, you you you can't. You you can't. You know, maybe once in a while the lucky, you know, that luck happens and and if that's what you want, then it works. Um, you know, it's it's a little bittersweet because we had just launched our second product, which was a uh reversal agent for the factor 10 inhibitors called a DEXO, a product we really liked and had gotten approved both in the US and Europe. So we had a lot of work that had been done through the my tenure at Portola to get two drugs approved and on the market. Um, and but this goes back to maybe another discussion that we may have, which is how do you launch a drug?

Ben Comer:

Yeah.

Mardi Dier:

How do you launch a drug in US and Europe and how do you do that successfully? We were we were a research organization who became a commercial organization. And um maybe maybe uh the uh we got caught in the short the launch thesis, which many hedge funds have, which many investors have, which means it's an unnatural transition generally for a company to go from a very successful research organization to all of a sudden be able to have all the experience to sell the drug.

Ben Comer:

It's a huge shift.

Mardi Dier:

It's a huge shift. And if you're not uh doing it perfectly, which is a tough standard, investors can come in and short the launch, which is exactly where Cortola was at the time. So the value we had actually lost quite a bit of value as we are trying to launch indexa into the marketplace. It's launches are hard and they're not always linear, and there is no margin for error from the uh from the investor community. They, you know, instead of saying, well, there's gonna be so much value for this product, but it's gonna take two or three years to really gain ground, they kind of grade you on how you do in those first couple of quarters. And, you know, we were graded, I think we were graded kind of harshly. And at that time, I think Alexion, it's a cool product, no doubt. And Alexion came in and took advantage of that. It also was the start of COVID. So there was a lot of things going on at once. Um, but for the board and the management team at that time, it didn't make sense to sell. So to answer your question, we didn't ready for sale at all. We wanted to grow this uh product on our own in the US and Europe. Um, but you know, when somebody comes calling, you you, you know, you have a fiduciary responsibility to uh take that into consideration, in which we did.

Ben Comer:

Well, you got a little taste of uh that commercialization um struggle, you know, and the the trickiness of a launch uh at Portola. You're reprising that a little bit with with Madrigal, and we'll we'll talk about that in just a second. But uh before we do, after Portola, you went to Ultra Genics at CFO, um, a unique ultra-rare company. You were there for a couple of years. You were CFO and CBO, I believe, um at um at Celerin.

Mardi Dier:

At Celerin, yeah.

Ben Comer:

At Celerin, right? Um, what what were the what could you say about those experiences, maybe how they differed?

Mardi Dier:

Oh, yes, opposite ends of the biotech uh uh experience. So I did so uh after Portola was sold, took a little break, trying to think about what's next. I had joined some boards, so I also do board work, um, which is really fun and exciting. And uh was looking for my next role, and I knew I wanted a little more critical mass in a company. Like I wanted to see again, I sort of have this itch. It's like, how does a commercial launch work? Like, how does it successfully work? And Ultra Genics is one of the um bigger biotechs in the Bay Area that has commercial products. They are in the rare disease space, which I thought was actually very cool and I wanted to learn about it. And they have a CEO, Amil Cakis, who's a kind of a stalwart in the biotech industry and is such a wonderful, charismatic, interesting person and just so passionate about rare disease. Um, it just seemed to make a lot of sense for me and where I was in my career. Um, and it was great. You know, going to ultragenics. I'm sorry it was only two years, but it was two great years. Um there was a lot of value created there. And they have a lead product, which is sold in many countries all over the world, Latin America, US, Canada, Europe, uh, for it's what's called a rare disease called uh bone disease called XLH. And um actually it was a really good product. And they were that we had a great commercial team and able to sell it. And in addition to the commercial organization, there's just some cool research that was going on um on the rare disease side that was kind of fun to learn about and exciting. Um and and so so ultradicts is great, remains great. Um, I still am in touch with email, but I I did get a phone call a couple of years in from an old friend who had started a Celerin. And he just said, come help us. You don't want to miss this one. Super exciting. Um, and so I I did, I jumped ship. I was like, oh, I have one more startup in me, right? It takes a lot of energy to do a startup. It's like I have one more in me. And uh, you know, Celerin, it was a it was a brief stint, but a really powerful stint. We got there, basically no infrastructure, acquired a company and some technology, and then decided we are gonna go public based on some phase two A data in the immunology space. And we just kind of hit the market right. We did a huge IPO, over $600 million IPO, one of the largest clinical stages stage IPOs. Um still a lot to be um proud of. It was great. Um and then I left shortly thereafter for for a lot of reasons, but it made sense both for for me and the company. Um, but at the time, that that very quick few months at Accelerin, we we accomplished a lot. And it was very, very exciting um and fun. But left Accelerin. So it to answer your next question, um, I still had this itch. Like, how do you really launch? I'm a I kind of have biotech in my blood. How do you really launch a product in the US and elsewhere successfully? How do you not get the short the launch happen to you? Yeah. How do you drive value? It's gotta be done. You don't, it can't just be pharma. And you know, most people call me crazy because it's like it doesn't happen. Like, you know, you just it's a hard lift. Um, but um our chairman of our board is someone who I've known from past investments. Uh he's a one of a very large investor in biotech, introduced me to Bill Sibyl, our CEO at Magical. Um, and even though the job is on the East Coast in Boston, it's just he's experienced. He's um, you could tell, just so talented. He understood the space uh or the opportunity of the space. Not to say he was a mash expert, he wasn't, but he understood the opportunity. And um, you know, he'd been his track record speaks for itself in terms of launching drugs. So I kind of hitched my wagon to Madrigal and jumped in, kind of like holding my nose, like, okay, what am I in for? Um, and you know, we can we can go into that and the success here.

Ben Comer:

Yeah, well, that was uh, I think you joined in February of 2024. Madrigal was on the precipice of its first FDA approval, uh, which we now know was approved. Um I I I assume you really had to hit the ground running when you when you joined the company a month away from from an approval. And I wonder what you could say just about kind of how you got your legs under you.

Mardi Dier:

Uh are they under me?

Ben Comer:

It appears so.

Mardi Dier:

Uh yeah, I am standing actually. Um oh yeah. So, oh man, what what an amazing, oh God, how many months has it been? 20 months and counting uh for everybody, the whole, the whole company. So I joined February 2024, that's right. And um I was, I think, employee in the 400 range, but we had gone from like 200 to 400 just a month before by putting the sales force in place really late. Meaning usually you do that, you know, 12 to 18 months before you're gonna get approval if you're going at risk. Um, but madrigal was a Dyed-in-the-wool RD company driven by our founder, Becky Tao, that brought Res Difra through and her team through the FDA and to be the first drug out of I think there were 23, 26 failures in Nash.

Ben Comer:

Yeah, there's a big graveyard in NASH at the time. Yeah, I remember covering it. Yeah.

Mardi Dier:

And the whole company was focused on res Difra and getting it approved. And they did, I mean, unbelievable. And it was, you know, only the September of 23, so just a few months before approval, that they brought in Bill Sybil. Like, oh wow, we gotta we gotta commercialize this puppy, right? Like we gotta bring in the experience, and and we're gonna launch in April. I mean, that's only for seven months from when he joined. And there were probably a hundred people here when he joined. So luckily, you know, his background and his experience allowed him to recruit people he knew in the industry who have commercial experience. Carol Huntsman, our chief commercial officer. Um the number of people have touched Bill throughout his career. And he was able unbelievably, they were able to get a uh commercial and medical organization up to speed for commercial launch in the number of months, all the while, all the while, you know, working with the FDA, keeping the RD going, making sure we get to approval that we can make the drug and actually launch it. So from the GNA side, from my side, CFO side, et cetera, again, the company was only set up and right-sized to get the drug approved. Nothing was really contemplated or planned of, oh my gosh, what happens once you go commercial?

Ben Comer:

I mean, and I I assume the clock really like you, you know, you you talked about the short investors going back to your previous experience. I I assume the clock, once that approval is announced, there's a clock that starts ticking, right?

Mardi Dier:

Yes. Oh, yeah. Can they do it?

Ben Comer:

Yeah.

Mardi Dier:

Who's who's Bill Sibyl? The investors ask, you know, for bio, he's not a biotech, he wasn't a biotech person. He certainly is now a biopharma, I would say. But who is he? Like, what's his experience? Has he run a company before? Who's the commercial team? What happened to Becky? Who's the CFO? What team are they putting together? I mean, so many questions you could see. That's just on the team side. But they also were putting all sorts of short theses out there about what is what's the label going to look like? You know, is this really a market? Are the GLP ones gonna like take the whole mash market away? Like, really, what are they doing? Is there any value here? And um, you know, so we obviously we got to the March 14th timeframe. Not only did we get approval, we got a, you know, a best case label and um, you know, and launched within weeks. Honestly, it was like April in mid-April sometime that we launched the drug. And I would say then that objectively, which I'm not, but objectively, it's been an exceptional launch. I mean, really most excellent. So back to your question about how'd you get your legs under you? Um we have we have a relentless spirit here at Madrigal. Like everybody on the executive team and surrounding the executive team have years and years of experience. They may have known each other, a lot of them knew each other, but not everybody knows each other. But they all know what to do. They're pros, right? So they're coming in here and it's just like we all know we got to get our job done and we got to work really well together. I've never been with a team, honestly, that works so well together to making decisions and they're hard decisions and running and getting things done and wanting to do well. We really across the board have an exceptional team in Maduro.

Ben Comer:

I wonder if you could say a little bit more about that transition from, you know, as you describe it, dyed in the wool, RD shop, turning into a commercial company from from a leadership perspective, you know, what what's in that playbook? You know, what what goes into, I mean, thinking like culturally and not to mention just on a kind of task level. Yeah.

Mardi Dier:

Both, both, both, both. Um, so like I said, the the company was was fit for purpose to get this drug approved, but things like corporate culture or corporate core values or things when when you get bigger and you have critical mass, you know, that wasn't the priority. And it I'm not being critical, it's just it's just factual. That's that's what they they did what they needed to do to get this drug approved, and it was monumental, huge lift. You know, we're a leader in this space for sure for the mesh space. Um so we really had to we had to do all of it. But in some ways, from a culture standpoint, we almost have a blank slate. Like because you're kind of going from a hundred people a few months ago to five, six, seven, eight hundred people. So you had the chance to direct that culture. And we worked with our exceptional um head of communications and put together our core values, uh, which are very simple, easy to use. Everybody understands them. And um, you know, we we use them when we interview, we use them when we put slides together. And it's just a little bit of wow, we're here because. We're mission driven and we're really focused on the patient. You know, we collaborate. We have to collaborate. The minute you have silos, you're dead. You have to collaborate cross-functionally. You have to have an owner mindset, meaning we're running so fast. But you know what? You can't wait really for someone to tell you what to do. Like have an owner mindset, like pitch-in, come in and and help, and then innovate. You know, like innovate where you can because our competitiveness in this space is super important. So being first mover, take advantage of it. Getting the drug to patients, we have over 23,000 patients on drug now is is vital. How can we innovate in a in a highly regulated industry to make sure we can do things faster and better? So those are our core values, super easy, and it's really what's driven us over the last 20 months.

Ben Comer:

What what are some and I I guess I'm I'm thinking about, you know, um Madrigal's commercial strategy. I I think you're selling direct in the US and Europe. Um, I'm not sure what you're doing beyond those markets, but could you give me a sense of, you know, maybe in your view, what were some of the keys to uh to having a successful launch, to being as you know, as successful with the launch so far as you have been?

Mardi Dier:

Yeah. Um it it's pretty it's important. And this was really governed by um, you know, the commercial team and Bill really understanding how best to launch into this market, meaning this is a specialty product. So we are targeting, we're not targeting everybody. We're not going to primary care physicians and selling direct and having an enormous sales force. We are focused on the 315,000 patients that have been diagnosed with moderate to severe MASH that fit within our target physician group. And so that is our focus and our story. And then we price the drug appropriately for exceptional value, supported by ICER reports and other ways. And when you marry the specialty population with the value of the drug and then the size of our sales force, it's kind of a recipe for driving a lot of revenue, getting the drug to patients, which is so important, the ones that need it and are diagnosed, and really driving value for the organization. So, you know, just exceptionally smart to say stay disciplined on exactly how you're gonna sell the drug, how you're gonna get the most drug to patients efficiently, and and increase your penetration both on breadth and depth every quarter. That's our goal. And that's what we've done. So in the US, yeah, we sell through um our specialty pharmacies as a specialty model that's working, doing the same in the EU. So that in the EU, a number of the big countries will be selling direct if everything makes sense in those countries. Um, access is always a little bit more challenging in Europe. Um, and then we'll also find countries where it makes sense for us to sell and maybe we partner either with a distributor partnership model and/or you know, an outlicensing in other countries. So that's still unfolding as we decide where our opportunity is. But in the in the main markets, and what the launch today has been a specialty, specialty um medicine launch.

Ben Comer:

Um, you mentioned uh referencing ISA reports. That's the Institute for Clinical and Economic Review. And I'm just curious, like in your role as uh as CFO, are you having input like on the price, on setting the price? Does that fall within your purview?

Mardi Dier:

Well, we have a pricing committee that, you know, it's not certainly not me, but I'm part of a committee that we discuss and and set price wherever we are. That's important. It has to be committee driven, it has to be data driven. ICER is just one element that helps because it really shows um it's a third-party independent research organization that uh gives a range of where the clinical benefit, where the value of the product is, and we fall within that value. It's been a great story. Um and it just, you know, price and medicine, pricing medicine is very tricky, of course, and we understand the environment now as well. Um, having third-party value validation is is really helpful. Um, but honestly, you know, again, back to the strategy that has not um, you know, so far been an issue, right? We've had a very successful lot.

Ben Comer:

Yeah.

Mardi Dier:

Yeah.

Ben Comer:

Excellent. Um uh Madrigal is a commercial company now, but that doesn't mean you aren't still doing development work. Um, what what would you say about Madrigal's current pipeline right now?

Mardi Dier:

So our strategy is really simple. Drive top line, that's ResDifra right now, and build pipeline, right? We know to reach the most patients and continue to drive value. Uh, we're very focused on MASH right now, that it can't just be a single product. We really see ResDIFRA as the foundational therapy for MASH. And so, on top of that, how can we even treat patients better? Is it more of a selective subset of patients, or is it adding a GLP one where you have some weight loss where we've actually shown that you can have just 5% weight loss, that ResDifra actually works better in uh reducing uh liver fat and reversing liver stiffness. Um, so there's a lot of different strategies that are going to play out here. And if you think of sort of analogous industries, whether it's rheumatoid arthritis or psoriasis, when the first drugs came out that are still very successful, you since then have seen 20 years of growth, right? And a lot of different products come in, a lot of different combinations, but yet the still the pie is still continuing to grow. And we think very much this is gonna happen in the MASH market too. We are at the very beginning. We're only 10%, 7, 8, 9% penetrated into our 315,000. You know, that we believe that top of that funnel is going to continue to grow as more patients are diagnosed and the awareness of MASH continues. So we'll take ResDiFra as that foundational therapy. We have um IP out to 2045, and then we're building a pipeline to see how can we make maybe combinations, you know. So ResDIFRA plus an oral GLP1, which we've been in licensed, how will that look? Are there other indications that ResDifra can be good for? Like we have our F4, which is compensated uh cirrhosis study ongoing. So really important, going back all the way to the catalyst to drive value, like clinical catalysts, really important to have those catalysts to help drive value of the organization, but also the data to continue to get ResDIFRA in whatever form or any combination or additional assets to patients.

Ben Comer:

Right. And we've talked about um how difficult it can be to launch a drug successfully. It's also exceedingly difficult to develop a drug all the way through to approval. And I wonder if there's anything else, Marty, you might say about balancing commercial excellence with replenishing the pipeline, you know, keeping the development engine running from a financial perspective.

Mardi Dier:

Oh, yes, from a financial perspective, and we haven't talked a lot about that, about deal making. Um, you know, in biotech biopharma, cash is king, right? No, we're we have the luxury that we're getting to a point where, you know, we're getting a lot of revenue on the top line, but you know, we're just getting there. So how do you manage that? You know, particularly.

Ben Comer:

Yeah, like what percentage do you pump right back into RD?

unknown:

Yeah.

Mardi Dier:

Well, right now we're kind of in this sweet spot, meaning we want to build pipeline. It's super important. We message that, we're investing. We've done one deal already, we talked about additional BD strategies. So this is the time to come back into RD. Our big phase three studies, white, they're still ongoing to an extent, but the big bulk of the spend um for ResDIFRA, uh, we've already, you know, are in the past. So now we want to refill that copper. So it's really two things, which is messaging to the street. It's building out the right team for the next level of growth on the RD team. You know, we're not going to just have one product. We may have, you know, a number of products that they need to bring forward. Um, and then having the right capital in the bank, um, all the while marrying RD with the rest of the organization culturally. So we have become one company, not commercial and RD, but how do you operate as one company? I think we're doing a pretty good job, but we're at that sweet spot of forming all that right as we speak. From the street perspective, this is like I said, this is the time to do it because people are only looking at our top line really for now. I mean, obviously they want to manage spend, but we have capitalized the company in a way that we've taken any sort of financial overhang off the table for now. We manage that really well. So now the questions from the street are more RD or commercial focused, not about how you're going to capitalize the company and what's your next deal and where's the dilution. So um, from that perspective, or we I think we're doing a pretty good job.

Ben Comer:

Yeah, that's a good place to be in, no, no doubt. Um, magical n-licensed uh, we've been you've mentioned GLP1s. You N-licens the GLP1 candidate from uh a Chinese company, CSPC Pharmaceutical Group Limited. Um, that's gonna be developed in combination, uh, as you mentioned with your approved uh product ResDifra. Uh, there have been a lot of deals uh with Chinese biotechs recently. It's a very hot area in the industry, lots of conversations about it. I'm wondering if there were any unique uh complexities that you had to overcome or or will have to overcome uh to bring that drug in into U.S. development?

Mardi Dier:

So uh it yes, very good question. You always have to look at that and manage that. And when you're going um doing a deal with any of those companies, you know, some of the things you look for, do they have a US presence? Did they run uh the studies? Uh this is a preclinical study, so it doesn't quite uh have rigor, but you know, have have they done some of the work in the US? You know, so we have looked at later stage assets as well. You do want to kick the tires on that because you don't want to, you know, uncover something that, you know, was done on an unfamiliar setting that makes no sense for what you're trying to do. In this case, also the company, CSPC is a very large company, very large company, um, and um had a lot of rigor. We had a lot of great meetings, um, you know, easy, easy back and forth in terms of the of the negotiations for the deal. But I would say, and this is a pre-clinical asset um that will go in the clinic later this year, um, you know, from in this space, the GLP one space, you everybody knows is huge, right? Yeah. A lot of competitors. So you do have to tiptoe through the minefield of IP, uh, intellectual property, of course. It would do that Chinese company, US company, whatever company, right? Right to make sure that you have freedom to operate. And I would say our IP work here at Madrigal is um exceptional and top-notch. And, you know, so we did a lot of work there on the IP and really feel good about our relationship with CSPC. Um, that said, you know, it's pre-clinical, we'll have uh we'll transfer the work um after early phase one over to the US and we'll take it from there. But, you know, any try, anytime you're combining, you know, even though GLP one's our known mechanism, but anytime you're combining two drugs, there's an it's biology, right? You know, you there's an element of the unknown. Yeah, absolutely. So um that's why we want optionality and a lot of shots on goal. Uh, because you can on paper, the academic exercise looks really good, but in reality, you've got to run the experiment and see if it works. So there's lots of data on both drugs, obviously, uh on the mechanism of GLP1, and then a lot of data on ResDifra. So we know what we know. Um, so not going in this blindly, but we think it could be a really cool opportunity.

Ben Comer:

Great. Well, um, looking forward, Marty, uh, what what are your top priorities, I guess, through the end of this year and maybe for the first quarter of 2026? And you're coming up on earnings. So I really especially appreciate you being here today.

Mardi Dier:

Yeah, yeah. We're coming up on earnings, so we won't talk anything about you know specifics regarding earnings. Um our top priority is, you know, continue. Well, we've kind of said it is to continue growth and uh of resdifra, our top line. Really important. We think this is a major blockbuster opportunity for us. And we want to be smart, creative, agile in making sure we get this medicine in the most uh uh physicians' hands and then to the right patients. Top, top priority for the rest of this year and next year. Um, and then um, I think specifically is really laying out our catalysts to drive value from the RD side. So really putting together all our efforts and just continued execution. Um we're still building out infrastructure and systems, uh, which is exactly what we should be doing, uh, because we really want to build uh, you know, a world-class top-notch institution. And I think we're on our way. Things are going really well.

Ben Comer:

What's your next um uh clinical milestone or next kind of uh big, you know, big thing in the clinical side?

Mardi Dier:

Yeah, well, so we have, I'm glad you asked, actually. I mentioned our F4C study. So this is what we call Maestro Nash Outcomes Study, and it is looking at more severe NASH patients in that F4 relates to um cirrhosis when you've tipped the scale from you know fatty liver, you know, progressing fatty liver disease, and then you become cirrhotic. And you can have compensated cirrhotic and decompensated cirrhotic, not an area where you want to go because it's it's a little bit hard to return from there. But in this compensated cirrhotic population, there's a real opportunity for us to make a difference. And there's no medicine there with a label to uh treat these patients. And we had some early data that we showed last year at Easel, and then we keep talking about that was fantastic. Um, but the phase three is ongoing. So that's our next data set in 2027, and that's that's a big one.

Ben Comer:

Okay, because res difra is for non-cerrhotic, is that correct? Correct.

Mardi Dier:

It's for for moderate to severe um um mash, um, similar to F2 and F3 patients, as they are graded in certain ways. This tips the scale into the cirrhosis side of things.

Ben Comer:

Got it. All right. Well, um, Marty, thank you again so much. Uh, right, you know, coming up on earnings for for taking the time to be on the show. I I really appreciate it.

Mardi Dier:

Yeah, Ben, thank you. I really enjoyed it. Yeah. Have a great day.

Ben Comer:

We've been speaking with Marty Deere, Executive Vice President and Chief Financial Officer at Magical Pharmaceuticals. I'm Ben Comer, and you've just listened to the Business of Biotech. Find us and subscribe anywhere you listen to podcasts, and be sure to check out new weekly video casts of these conversations every Monday under the Business of Biotech tab at life science leader.com. We'll see you next week, and thanks as always for listening.

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