Akebia Therapeutics, Inc. — FY2023 Form 10-K
Reporting period: Fiscal year ended December 31, 2023. This is an annual report, not a standalone fourth-quarter report; the supplied filing text does not provide clear standalone Q4 financial results. Figures below are in U.S. dollars.
Business context and reporting period
Akebia is a commercial-stage biopharmaceutical company focused on kidney disease. Its U.S. commercial product is Auryxia (ferric citrate); vadadustat is marketed by partners as Vafseo in several countries and was awaiting an FDA decision for U.S. dialysis patients as of the filing date. The company also has two HIF-based candidates in preclinical development.
Financial and operating metrics
| Metric | FY2023 | FY2022 |
|---|---|---|
| Net product revenue | $170.3 million | $176.9 million |
| License, collaboration and other revenue | $24.3 million | $115.5 million |
| Total revenue | $194.6 million | $292.5 million |
| Cost of goods sold | $74.1 million | $85.6 million |
| Research and development | $63.1 million | $130.0 million |
| Selling, general and administrative | $100.2 million | $138.6 million |
| Operating loss | $46.3 million | $80.8 million |
| Net loss | $51.9 million | $94.2 million |
| Net loss per share, basic and diluted | $0.28 | $0.52 |
| Cash used in operating activities | $23.4 million | $73.2 million |
At December 31, 2023, cash and cash equivalents were $42.9 million, restricted cash was $1.7 million, current assets were $118.1 million, and total assets were $241.7 million. Total liabilities were $272.3 million and stockholders’ deficit was $30.6 million. Year-end debt included $35.0 million of Pharmakon principal outstanding; the balance sheet showed $17.5 million current and $17.2 million long-term debt, net.
Margins: The filing does not state a headline gross-margin percentage. Total cost of goods sold included $36.0 million of Auryxia intangible-asset amortization, scheduled to continue through 2024.
Material changes versus the prior comparable year
- Total revenue fell 33%, primarily because 2022 included $92.3 million of Otsuka-related revenue and more MTPC product-supply revenue. Akebia does not expect further revenue under the terminated Otsuka agreements.
- Auryxia revenue declined 4%, mainly from lower volume, partly offset by higher pricing, improved payor mix and contracting changes.
- Operating expenses declined 42%. R&D fell 51%, reflecting completed or wound-down trials and lower vadadustat spending; SG&A fell 28%, principally due to the 2022 workforce reductions, lower professional-services and marketing costs, and facility savings.
- Operating cash use improved by $49.8 million year over year. The filing attributes 2022 cash use in part to working-capital movements and the BioVectra-related purchase-commitment benefit, so the annual comparison includes unusual items.
- Akebia recorded $4.3 million of lower product costs in 2023 from selling inventory previously written down to zero. It reported up to $12.3 million of similar potential cost benefit, primarily in the first half of 2024, subject to sales.
Liquidity, debt and financing
Management said available resources and expected receipts were intended to fund its current operating plan for at least 12 months from the filing if vadadustat was not approved in the U.S.; elsewhere in MD&A, it estimated at least 24 months if approval was obtained. These are conditional forward-looking estimates, not assurances. The company reported recurring losses and negative operating cash flows and stated that weaker performance or a negative FDA decision could impair liquidity and raise going-concern concerns.
After year-end, on January 29, 2024, Akebia drew $37.0 million under a new BlackRock/Kreos secured facility, receiving approximately $34.5 million net and using the proceeds to repay the $35.0 million Pharmakon loan. Up to $18.0 million of additional tranches were available subject to conditions, including FDA approval. The facility carries floating-rate interest (SOFR plus 6.75%, with a 15% all-in cap), collateralizes substantially all assets, and includes minimum-cash or revenue covenants. The company also sold 6.2 million shares through its ATM in 2023 for $6.7 million net; it disclosed a further 13.3 million shares sold in January–February 2024 for $18.7 million net.
Outlook, risks and unusual matters
- Vadadustat regulatory decision: FDA accepted Akebia’s resubmitted NDA for dialysis-dependent CKD patients and set a March 27, 2024 PDUFA date. The filing’s date is March 14, 2024, so it does not report the FDA’s subsequent decision. The 2022 CRL cited benefit-risk concerns, including non-inferiority failure on MACE in non-dialysis patients, vascular-access thrombosis in dialysis patients and potential drug-induced liver injury.
- Clinical safety: The dialysis Phase 3 program met its primary MACE non-inferiority endpoint (HR 0.96; 95% CI 0.83–1.11), but showed an increased thromboembolic-event estimate driven by vascular-access thrombosis (HR 1.20; 95% CI 0.96–1.50). The non-dialysis program did not meet its primary MACE endpoint (HR 1.17; 95% CI 1.01–1.36). The company reported hepatocellular injury attributed to vadadustat in fewer than 1% of patients, including one severe case with jaundice.
- Auryxia exposure: U.S. patent settlements permit generic entry beginning March 20, 2025, subject to FDA approval or earlier customary conditions. Oral-only phosphate binders are expected to enter the Medicare ESRD bundle in January 2025, absent further policy changes. Akebia aims to grow Auryxia revenue in 2024, but expects these events to affect sales, pricing and customer purchasing.
- Other commercial and execution risks: Auryxia volume, reimbursement and payor access; vadadustat approval, uptake and dialysis-organization formulary decisions; competition; dependence on collaborators and single-source manufacturers; inventory and supply quality; and additional financing needs.
- Debt and dilution: Failure to secure vadadustat approval by June 30, 2024 would affect the new loan’s maturity and repayment terms. Additional ATM sales and warrants could dilute existing holders.
- Accounting controls: Management identified a material weakness in inventory accounting and related transactions, including reconciliations, costing, classification and purchase-commitment liabilities. Management and the auditor concluded internal control over financial reporting was ineffective; the auditor issued a qualified opinion on ICFR. The financial-statement audit opinion was unqualified. The prior material weakness involving product-return reserves was reported remediated.
- Legal and contingencies: The filing describes ongoing patent proceedings and a stockholder lawsuit relating to the Keryx merger; at the March 13, 2024 hearing, the court granted Akebia’s motion to dismiss. The filing says the company could not reasonably estimate possible losses earlier in that action. Other commitments include BioVectra termination payments and manufacturing purchase commitments.
Most important facts for investors to verify
- The FDA’s decision and any label, safety, post-marketing or reimbursement conditions for vadadustat, and the resulting launch and cash-flow assumptions.
- Actual cash runway, covenant compliance, loan repayment requirements and financing needs under both approval and non-approval scenarios.
- Auryxia sales, inventory reserves and returns, the 2025 generic-entry timetable, and the effect of ESRD bundle reimbursement.
- Progress and independent validation of inventory-control remediation; whether any errors or adjustments emerge in later filings.
- Vadadustat safety evidence, including thromboembolic and liver risks, and the uptake and economics of partner commercialization.