Esperion Therapeutics, the Ann Arbor-based biopharmaceutical company, has been on a roller coaster ride in recent years. After the publication of their landmark CLEAR Outcomes trial, demonstrating the cardiovascular benefits of bempedoic acid, the anticipation for their label expansion has been palpable. The Q1 2024 earnings call confirmed that the company is firing on all cylinders, with record revenue and a clear strategy for growth. But beneath the surface, a subtle shift in the payer landscape reveals a hidden trigger that could unleash a wave of prescriptions, catapulting Esperion into the blockbuster territory they've long envisioned.

The spotlight, understandably, has been on the recent FDA approval of the expanded label for NEXLETOL and NEXLIZET. This allows Esperion, for the first time, to actively promote the impressive risk reduction data to a vastly expanded patient pool, now including those in primary prevention. The 70 million potential patients in the US alone represent a tantalizing market, triple the size of their previous addressable population. However, everyone is focused on the commercial payer landscape, watching for signs of utilization management criteria changes.

Here's where the hidden trigger comes in. Buried in the Esperion Q1 2024 Earnings Call Transcript, almost as an aside, is the confirmation of a "new win" with one of the largest Medicare providers. This, combined with an existing provider's update to align with the new label, suddenly brings Esperion's Medicare coverage close to 50%, a significant jump from their previous position. While this development might seem like a minor detail, its implications are profound.

The Medicare Multiplier:

Medicare patients are, by definition, older and thus at a higher risk for cardiovascular disease. They are also more likely to be on fixed incomes, making affordability a crucial factor in treatment decisions. Esperion has consistently emphasized the cost-effectiveness of their therapies, a message that resonates powerfully with both payers and patients. The recent determination by ICER, deeming NEXLIZET cost-effective, further reinforces this point. With broader Medicare coverage, physicians now have a potent, affordable option for a significant portion of their high-risk patients.

Beyond the Headlines:

The current market analysis for Esperion largely focuses on the commercial payer landscape, with most analysts predicting a gradual ramp-up of prescriptions over the next two quarters as utilization management criteria change. This analysis, however, overlooks the potential impact of the Medicare win.

A Hypothesis Worth Testing:

We hypothesize that the Medicare coverage expansion, coupled with ICER's positive assessment, will act as a catalyst for a faster-than-expected uptake of NEXLETOL and NEXLIZET.

Here's why:

Immediate Access: Unlike commercial payers, Medicare's updated coverage is effective immediately, removing a significant barrier to prescription for a substantial patient population. High-Risk Focus: Medicare patients are, on average, at higher risk for cardiovascular events, making the risk reduction benefits of bempedoic acid even more compelling. Cost Sensitivity: Affordability is paramount for Medicare patients. Esperion's cost-effectiveness data, validated by ICER, makes their therapies a compelling choice.

The Numbers Tell a Story:

While it's still early days, the initial momentum seen in the first weeks of Q2, with week-over-week script growth, hints at the potential of this hidden trigger. If our hypothesis holds true, we could see a significant acceleration in prescription volume, potentially exceeding analyst expectations.

Retail Prescription Equivalents (RPE) Growth

This chart, based on data from Esperion's Q4 2023 and Q1 2024 earnings calls, illustrates the consistent growth in retail prescription equivalents, a key indicator of market demand for Esperion's therapies.

The Bottom Line:

While the focus remains on commercial payer changes, the recent Medicare win for Esperion might be the hidden catalyst that unlocks the blockbuster potential of their franchise. With broader access for a high-risk, cost-sensitive population, Esperion could see a wave of prescriptions in the coming months, exceeding current market projections. The next few quarters will be crucial in testing our hypothesis and determining the true impact of this significant development.

"Fun Fact: Esperion's headquarters in Ann Arbor, Michigan, is a stone's throw from the University of Michigan, a renowned center for cardiovascular research. This proximity fosters a collaborative environment, fueling Esperion's commitment to scientific innovation."