Executive Summary / Key Takeaways

• Mirum Pharmaceuticals has established itself as a growing force in rare diseases, particularly cholestatic liver disorders, leveraging its differentiated IBAT inhibitor technology (LIVMARLI, Volixibat) and strategically acquired assets (Bile Acid Medicines/CTEXLI, MRM-3379).
• The company is demonstrating robust commercial execution, achieving record Q1 2025 revenues of $111.6 million, a 61% increase year-over-year, and raising its full-year 2025 net product sales guidance to $435 million - $450 million, signaling strong underlying demand and market penetration.
• Recent regulatory successes, including the FDA approval of CTEXLI for CTX in adults (with orphan exclusivity) and a convenient tablet formulation of LIVMARLI, alongside international approvals and launches, are expected to drive continued growth and expand market reach.
• The pipeline features high-impact catalysts, notably the advancement of Volixibat in adult cholestatic diseases (PSC/PBC) with positive interim data and Breakthrough Therapy Designation in PBC, and the initiation of a Phase 2 study for the novel PDE4D inhibitor MRM-3379 in Fragile X Syndrome.
• Mirum has achieved positive operating cash flow and expects to maintain this in 2025, reflecting improving financial discipline and commercial scale, providing resources for pipeline investment and potential future business development.

Setting the Scene: Building a Rare Disease Franchise

Mirum Pharmaceuticals, founded in 2018, has rapidly carved out a significant presence in the rare disease landscape, focusing initially on debilitating cholestatic liver disorders. Its foundational strategy centered on acquiring and developing promising late-stage assets, a path exemplified by the initial licensing of maralixibat (LIVMARLI) and volixibat from Shire (now Takeda) (TAK). This approach has allowed Mirum to quickly build a portfolio of approved medicines and a pipeline targeting areas of high unmet medical need.

The company's strategic evolution continued with the significant acquisition of the Bile Acid Medicines (Cholbam and chenodiol) from Travere Therapeutics (TVTX) in 2023. This move not only expanded Mirum's commercial footprint but also strategically diversified its focus, particularly into rare genetic neurology with chenodiol (now CTEXLI) for cerebrotendinous xanthomatosis (CTX). Further reinforcing this expansion, the recent in-licensing of MRM-3379 for Fragile X Syndrome leverages capabilities built through the CTX program, demonstrating a deliberate strategy to apply its rare disease expertise across therapeutic areas.

Mirum operates within a competitive biotechnology industry characterized by intense innovation and the presence of both large multinational pharmaceutical companies and smaller, specialized biotechs. Its competitive positioning is defined by its focus on niche rare disease populations, its differentiated technology platforms, and its commercial execution capabilities in specialized markets.

The IBAT Inhibitor Platform: A Core Technological Advantage

At the heart of Mirum's initial portfolio lies its expertise in ileal bile acid transporter (IBAT) inhibition, embodied by its lead product, LIVMARLI (maralixibat), and the pipeline candidate, volixibat. IBAT inhibitors work by blocking the reabsorption of bile acids in the small intestine, thereby reducing the systemic burden of bile acids, which are implicated in the severe pruritus (itching) and liver damage seen in various cholestatic conditions.

This technology offers tangible benefits over traditional therapies, which often provide only modest relief for severe pruritus. For LIVMARLI, clinical data in Alagille syndrome (ALGS) and progressive familial intrahepatic cholestasis (PFIC) have demonstrated significant and sustained reductions in pruritus, alongside improvements in serum bile acids, bilirubin, and growth parameters. While specific quantitative comparative data against all off-label alternatives like cholestyramine or rifampin is not readily available, management commentary highlights the "strong clinical value proposition" and the "compelling data" from the Phase 3 PFIC program showing improvements in growth and bilirubin, suggesting a broader impact beyond symptom relief.

The strategic importance of this platform is further underscored by the development of volixibat for adult cholestatic diseases, primary sclerosing cholangitis (PSC), and primary biliary cholangitis (PBC). Interim data from the VANTAGE study in PBC showed a "rapid, deep, and statistically significant improvement of pruritus," with an updated 28-week analysis revealing a 3.8 point reduction from baseline and a 2.5 point placebo-adjusted reduction in pruritus. Management believes this level of activity, driven by what they describe as a "maximally efficacious dose," provides a potential advantage over competitors. The Breakthrough Therapy Designation granted to volixibat in PBC by the FDA acknowledges the potential for substantial improvement over existing therapies for cholestatic pruritus in this population, an area with high unmet need.

Ongoing R&D includes the Phase 3 EXPAND study for LIVMARLI, targeting broader rare cholestatic pruritus settings (excluding ALGS, PFIC, PBC, PSC, ICP), representing a significant label expansion opportunity. This study, driven by physician and patient interest, aims to address an estimated 1,000 prevalent patients in the US and EU. The recent FDA approval of a convenient single tablet formulation of LIVMARLI for patients 25 kg and over, supported by a patent expected to extend coverage to 2043, enhances the product's profile and offers a "distinct convenience advantage," potentially driving adoption and switch demand from the liquid formulation.

Diversifying the Portfolio: Bile Acids and a Step into Neurology

The acquisition of the Bile Acid Medicines portfolio from Travere Therapeutics brought two established therapies, Cholbam and Chenodal, into Mirum's commercial fold. Cholbam is an approved therapy for specific bile acid synthesis disorders and peroxisomal disorders. Chenodiol, historically used under medical necessity for CTX, gained a significant boost with the FDA approval of CTEXLI for the treatment of CTX in adults in February 2025. This approval provides 7 years of orphan exclusivity and allows for active promotion targeting this underdiagnosed condition.

While Cholbam and Chenodal/Ctexli face potential competition from compounded and generic versions due to a lack of remaining patent exclusivity on the original formulations, the CTEXLI approval for CTX provides a period of regulatory exclusivity for that specific indication in adults. Management's focus is on increasing the diagnosis rate for CTX, estimated to have 1,000-2,000 prevalent patients in the US with only about 10% diagnosed. Promotional efforts targeting neurologists, ophthalmologists, and gastroenterologists are underway, aiming to bring new patients to treatment earlier and potentially impact the sales trajectory beyond the conversion of existing Chenodal patients to CTEXLI.

Building on the commercial and medical affairs capabilities developed for CTX, Mirum strategically expanded into rare genetic neurology with the in-licensing of MRM-3379, a PDE4D inhibitor, for Fragile X Syndrome (FXS). FXS is a rare genetic disorder affecting approximately 50,000 males in the US and Europe with no approved therapies. Management highlights the PDE4D mechanism's prior proof-of-concept data in FXS and believes MRM-3379's "highly selective" and "high brain to plasma ratio" profile is potentially differentiating compared to other PDE4D inhibitors in development. A Phase 2 study is planned to initiate in 2025, initially focusing on adult patients before potentially stepping down in age, leveraging the NIH toolbox as a potential registrational endpoint. This move represents a focused investment to achieve proof-of-concept in FXS before considering broader applications for the PDE4D mechanism.

Commercial Momentum and Financial Strength

Mirum's strategy of combining approved products with pipeline development is yielding strong financial results. The company reported total revenues of $111.6 million in the first quarter of 2025, a substantial 61% increase compared to $69.2 million in the same period last year. This growth was driven by strong performance across all three commercial medicines. LIVMARLI sales reached $73.2 million in Q1 2025, up over 70% year-over-year, fueled by robust new patient demand in the US across both ALGS and PFIC indications, as well as continued international expansion.

The Bile Acid Medicines contributed $38.4 million in Q1 2025 sales, a 47% increase from Q1 2024, benefiting from the integration into Mirum's commercial structure and early traction following the CTEXLI approval.

This commercial momentum has translated into improving financial health. Mirum achieved positive operating cash flow for the first time in Q3 2024 and expects to be cash flow positive for the full year 2025. The cash contribution margin from the commercial business improved from approximately 47% in Q1 2024 to 53% in Q1 2025, indicating increasing operational efficiency as sales scale.

While operating expenses increased year-over-year due to higher R&D investment (including a $5 million maralixibat development milestone in Q1 2025) and increased SG&A costs to support commercial expansion, these expenses improved as a percentage of revenue.

The company ended Q1 2025 with $298.6 million in unrestricted cash, cash equivalents, and investments, which management believes is sufficient to fund operations for at least the next twelve months. The strong start to 2025 has led management to raise their full-year net product sales guidance to $435 million - $450 million, up from the initial $420 million - $435 million, reflecting confidence in continued demand and execution.

However, the company continues to incur net losses ($14.7 million in Q1 2025), influenced by significant non-cash charges like intangible amortization and stock-based compensation, and ongoing investment in the pipeline. Future cash needs may require additional financing, which could dilute existing shareholders. The company also has outstanding convertible notes, which became convertible at the holders' option in Q2 2025 due to the stock price exceeding the conversion threshold. While the company can settle in cash, stock, or a combination, settlement in stock would result in dilution.

Competitive Positioning and Strategic Responses

Mirum's competitive strategy is multifaceted, leveraging its technological platforms, regulatory expertise, and commercial focus in rare diseases. In the IBAT inhibitor space, Mirum's LIVMARLI competes directly with Ipsen's (IPSEY) odevixibat (Bylvay/Kayfanda) in PFIC and ALGS. While Ipsen has established approvals, Mirum differentiates LIVMARLI through its clinical data profile, broader genetic coverage in PFIC labeling, and now, flexible formulations with the new tablet option. The Breakthrough Therapy Designation for volixibat in PBC positions it favorably against existing second-line therapies like Intercept's (ICPT) Ocaliva and pipeline candidates from various companies, highlighting the potential for a differentiated efficacy profile in pruritus. Management believes volixibat's dosing strategy offers a potential advantage in activity level compared to competitors.

In the Bile Acid Medicines market, Cholbam and Ctexli operate in niche segments. While generic and compounded versions pose a threat due to limited IP protection on the molecules themselves, the CTEXLI approval for CTX provides regulatory exclusivity for that specific indication in adults, offering a period of market protection. Mirum's focus on disease awareness and diagnosis aims to expand the addressable market beyond current treatment rates, a strategy less reliant on direct product-versus-product competition and more on market expansion.

The move into Fragile X Syndrome with MRM-3379 pits Mirum against companies like Shionogi (SGIOY) and others developing therapies for this indication. Mirum believes MRM-3379's specific PDE4D profile, particularly its brain penetration, offers a competitive edge. This expansion into neurology leverages the commercial infrastructure and rare genetic disease expertise gained from the CTX program, demonstrating strategic synergy rather than direct competition across all fronts.

Overall, Mirum positions itself by identifying overlooked or underserved rare disease opportunities, often with genetic underpinnings, where its expertise in clinical trial design (using patient-reported outcomes), regulatory navigation, and specialized commercialization can add value. While facing competition from larger, more resourced companies and the inherent challenges of rare disease markets (patient identification, reimbursement), Mirum's recent performance suggests its focused strategy and execution are gaining traction.

Risks and Future Considerations

Despite strong recent performance and pipeline progress, Mirum faces significant risks. Clinical trials, particularly the ongoing Phase 3 EXPAND study and the pivotal portions of the Volixibat VISTAS and VANTAGE studies, may not yield positive results or could face delays in enrollment or completion. Regulatory approvals are not guaranteed, and even with approval, market acceptance and reimbursement levels may be lower than anticipated, particularly given increasing pressure on drug pricing globally. Competition from existing therapies, pipeline candidates, generics, compounded products, and potentially gene therapies could limit market share and revenue potential. Reliance on third-party manufacturers and distributors, including sole-source suppliers, poses supply chain risks. The company's ability to successfully integrate acquired assets and manage future growth is critical. Furthermore, macroeconomic factors and geopolitical events could impact operations and financial markets.

The convertible notes introduce potential financial risks related to cash settlement upon conversion or dilution if settled in stock. While the company is cash flow positive, significant future investments in the pipeline and potential business development activities may necessitate raising additional capital.

Conclusion

Mirum Pharmaceuticals has demonstrated impressive execution, transforming into a growing commercial entity with a dynamic pipeline focused on rare diseases. The strong performance of LIVMARLI and the Bile Acid Medicines, highlighted by record revenues and increased guidance, provides a solid financial foundation. Recent regulatory approvals for CTEXLI and the LIVMARLI tablet formulation are poised to contribute to continued growth. The advancement of Volixibat, particularly with Breakthrough Therapy Designation in PBC, and the strategic entry into Fragile X Syndrome with MRM-3379 offer compelling future catalysts.

The core investment thesis centers on Mirum's ability to leverage its expertise in rare diseases and its differentiated technology platforms to drive sustained commercial growth from its approved portfolio while advancing a promising pipeline targeting areas of high unmet need. The shift to cash flow positivity underscores improving operational efficiency. While risks inherent to the biopharmaceutical industry and rare disease markets persist, Mirum's strategic focus, recent successes, and disciplined financial management position it for potential continued value creation. Investors will be closely watching the progress of the Volixibat and MRM-3379 clinical programs and the ongoing commercial uptake of its expanded portfolio.