Earnings call transcript Q4 2022

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Operator

Greetings and welcome to the Alkermes Fourth Quarter 2022 Financial Results Conference Call. My name is Rob, and I will be your operator for today's call. [Operator Instructions] Please note that this conference is being recorded.

I'll now turn the call over to Sandra Coombs, Senior Vice President of Investor Relations and Corporate Affairs. Sandy, you may now begin.

Sandra Coombs

you. Thank morning. Good Alkermes results the year call discuss to December Welcome business plc update financial and XXXX. and for our XX, to conference the ended quarter our Pops, With are Chief our CFO; and CEO; Commercial me Officer. Todd Richard Iain today our Nichols, Brown,

to I and alkermes.com non-GAAP reconciliations measures GAAP non-GAAP our we of section ongoing begin, to that Investors related conjunction our with are in economics results understanding financial today. results the everyone the financial encourage Before press We we'll go release, to the GAAP of of find tables, believe business. in discuss financial to the useful the

the Our morning, the include from accompanying forward-looking press discussions release differ and reports will Please from our materially factors risk call to these could could this for during statements. forward-looking recent and Actual of most see expressed presentation, issued annual conference those with our or statements. this differ results the SEC statements. actual important filed X Slide in cause forward-looking results materially our that quarterly implied

provided no information or future result new or we'll remarks, or obligation update our call open accompanying After this as prepared revise developments. to Q&A. of information in the call the a for results undertake presentation or We the on

Now, Todd. I'll to turn the call over

Todd Nichols

of everyone. of portfolio Great. double-digit our growth, and sales was our Thank the our a year focused and We good for achieved record XXXX driven commercial strategy. compared you products morning breakthrough organization. by commercial year for prior proprietary to execution

to success can gives the we neuroscience strong us early which In position commercial highlighted the treatment place launch LYBALVI. first its our platform, full-year results establish exceeded realize underscores space. the launch in important and launch, commercial LYBALVI’s ongoing the expectations was distinctive we year LYBALVI’s a paradigm. delivered in leverage across by that began The of of

its a foundation first just of fourth which label schizophrenia net generated bipolar full differentiated million, growth. sequentially In demand. by sales over believe future that In ago year, driven with $XX a and strong We provides I for launched were both the includes sales disorder. LYBALVI XX% LYBALVI year million, robust $XX.X a up LYBALVI broad quarter, we

XX,XXX, the driven XX% approximately fourth by use profile quarter increase LYBALVI’s product Total of strong due part were broad commercial and patients. execution. approximately prescriber prescriptions in and representing to differentiated growth of range in breadth quarter-over-quarter, demand was across a large The our

since the written increase of At end fourth an for prescribers its prescription LYBALVI of the approximately X,XXX the a XX% since represents of approximately end QX. had launch, which quarter,

driving As a be the us brand for we prescriber provides establishing a for significant key have mentioned before, awareness in foundation this to market. and breadth presence and continues priority

patients to split and not phenotype. branded business XX,XXX patients the were fourth in schizophrenia patients. use approximately the and particular bipolar than evenly This switching have utilizing XX% X Approximately a from XX% limiting LYBALVI December, and of variety been be of medications. quarter quarter through a its physicians for diverse source LYBALVI Prescriptions came broad range treated More continue patient for the are and other demonstrates the olanzapine generic that from with of to of between prescriptions in patients

anticipated. high their is data disorder, including level In patients X efficacy report bipolar LYBALVI. our as and persistency healthcare we Early a encouraging surveys with with and branded consistent perceive oral with research, of atypical satisfied market are provider LYBALVI and similarly majority a satisfaction antipsychotics schizophrenia its other of and

growing focus is prescriber breadth, to for further pathway our three-pronged awareness. enhancing access the XXXX, patients, building In and

and to caregiver will LYBALVI. drive an patient play we further role As mentioned before, we advertising have of believe awareness direct-to-consumer important

a psychiatry. Starting life product highly of in lifecycle a many earlier DTC an in product. to the therapeutic provides be brand driving effective in to have including effective the opportunity over campaigns been areas, greater growth campaign capture shown impact an

to component we campaign and already launch the underway TV is of marketing mid-year. our digital Our expect DTC program

We for stage a From will patients. are access access LYBALVI of believe we with branded to have for perspective, other Medicaid, Overall, In this Medicare long-term has for pathway these agents. LYBALVI. treated well-positioned drive market revenue the strategic LYBALVI growth we investments launch. similar and to all been a

established On in the we foundation access the this commercial side, engage year. solid a payers will with and of we terms again commercial have

of a patients a data. and advantage the Now assistance experience with programs. and market pathway co-pay In have meantime, of our access patient year's eligible the to worth through

the adjustments access will in may XX% profile net $XXX we half and in the is enhancing gross half We fairly the stable to for million. million sales benefit first to range We widen expect the anticipate LYBALVI year during second remain if the the range of in of $XXX there a net determine XXXX the to LYBALVI. high

million, driven year-over-year primarily X% therapy approximately to Net month growth quarter TRx fourth product Turning the the on ARISTADA by $XX.X sales family. of basis. were of in a

We are attributes an product the settings. commercial reached for all-time treatment strategy ARISTADA, despite in of return some in the to ongoing staffing shortages encouraged in growth family class] prescriber driven In as high, [ph]. the breadth the class, and such XXXX, persistent by our challenges [LAI by

and our in to prescriber coming grow expect depth the We continue to year. breadth

$XXX and ARISTADA's dynamics expect sales regimen, market dosing which we both current option the million from ALPINE $XXX in initiation proposition. continued data of every range two-month our value range once supported differentiated its by to are and clinical This study. Including reflects emphasis net ARISTADA ARISTADA million. For the XXXX, on our

of fourth XX% in sales primarily by be continue which driven to the Growth two-thirds Net approximately business VIVITROL VIVITROL indication, the quarter. VIVITROL. alcohol accounted for the dependence million. the approximately increased quarter to year-over-year $XXX Moving in in to sales

in range $XXX For million. XXXX, we million expect to VIVITROL net sales of the $XXX

As advance drive dependent a the a we continue environment. to VIVITROL strategy is in to complex in treatment alcohol indication. growth our product complex

confident our remain and starting today we position. litigation] [ph] in [ANDA Our with Teva

driving and that will we outcome an capabilities believe of paradigm. litigation, treatment play the committed role of have complexities in this we market support VIVITROL's to important have required to challenging utility for awareness established prove the entrants. We of commercialization believe will continue and it to of Regardless that to VIVITROL's the generic remain the potential that

significant LYBALVI, serve that neuroscience of the following VIVITROL, as the product and portfolio growth proprietary company play represent will separation top cornerstone business. as oncology ARISTADA pure a line Alkermes strong potential a portfolio product planned you the to growth operating look provides year. This on to and we updating drive our we into progress business that forward the built have leverage the and opportunity throughout

to the that, will With turn Iain. now over call I

Iain Brown

and Great. Thank everyone. hello, you, Todd,

ahead the significant represents and the year, The driven structure. LYBALVI expectations to cost our of capabilities. a launch company solid in highlight XXXX for growth results our for by the the of oral our for opportunity was large commercial report finished the antipsychotic proprietary market, we management products So, strong of year disciplined a are established and our pleased of financial performance and leveraging

and our long-term underlying results, The details we LYBALVI assumptions important underlying of through separation will of for the and oncology strength then the factor believe take business, updated help the of neuroscience to next oncology an reveal of I'll launch businesses oral the decision In to profitability our turn then XXXX you which with financial and business. was and the finish in XXXX targets. our minutes, the expectations the explore growth neuroscience our both profitability few

commercial VIVITROL we driven financial the of by XX% approximately $X.XX and LYBALVI, XXXX performance, launch Starting portfolio, proprietary strong which generated our total the primarily now XX% from total year-over-year and This full-year growth product of of with double-digit revenues growth first represents reflects each of well billion, as of grew as for our ARISTADA. revenue. results

full-year From in of XXXX. the loss million, XXXX of million compared perspective, $XX.X the the only royalties, million yielded non-GAAP for Recall line of year, royalties included a XXXX to we $XX.X GAAP XX $XXX.X incremental income recorded have U.S. would in bottom one-month. results net approximately included revenue. million compared these net and $XXX months year of U.S. while prior results $XXX.X that million of to J&J A

growth up growth indication. reflecting the turning quarter, the driven XXXX, net of net in Now, VIVITROL, and XX% dependence million, alcohol growth recorded in VIVITROL $XXX.X year-over-year million, In $XXX of to primarily sequentially we XX% sales year-over-year. by X% sales achieved fourth

stable approximately certain states from relatively during to recorded quarter. the gross favorability Medicaid third the we estimated. period And in lower $X end the million, of primarily in were coming credits levels prior originally Inventory of and related net quarter, comparison billings Medicaid to than

ARISTADA to Moving the product on family.

million, the For driven sales underlying year, XX% ARISTADA by to increased demand. net $XXX.X primarily

and launch were sales net slightly. XX.X% the million. the million, fourth net sequentially sales $XX full-year X% to its ARISTADA $XX.X stable of at net adjustments year-over-year. X% LYBALVI first channel increased were were in and Gross up inventory the quarter, for up For

XX% sequentially, up were the strong fourth quarter, demand by net For underlying growth. $XX.X million, sales driven continued

at growth. expected the And quarter, in-line coverage. increased XX%, adjustments QX inventory levels restrictive relatively the gross net demand to less stable primarily continuation approximately in payer initial of commercial During reflecting as with were

business. our Moving and on to manufacturing royalty

manufacturing For up solid manufacturing million was year. the to million $XXX.X prior VUMERITY, XX% and We year. and the saw of revenues royalty prior compares the of $XX.X million contributing in that revenues recorded $XXX.X million, we in year, $XXX to compared of which and growth year-over-year, royalty

agreement products in driven of million Royalties long $XXX.X from related Janssen's sales United the partial States. million, primarily XXXX. long INVEGA was the sales products on were royalties of by The INVEGA $XXX.X the decrease of acting the to acting in compared to termination

Arbitration pursuant the not that developed and sell proceedings under tribunal the Janssen related interim to paying issued are to the award, ongoing [Technical the had an last month, royalties continue to Difficulty]. finding that announced matter this without we agreement products may

Operator

standby, Ladies please technical and experiencing gentlemen, we difficulties. are

joining conference your Once resume [Operator again, standby, momentarily. Our will resume Instructions] you you. Thank for momentarily. Please thank conference will us.

by. standing and gentlemen, Sandy, you thank continue. Ladies please for

Iain Brown

Okay.

that. Sorry about

I think back we're we but had technical of now. issues, a couple

pick the was I'll where talking up royalty I about manufacturing So, business. again and

up compared We in manufacturing So, solid to royalty for of and in VUMERITY, at million was recorded prior to revenues million $XXX.X growth contributing million, $XX.X $XXX the million prior the the of and year. $XXX.X manufacturing XX% we year-over-year, revenues, year. royalty which saw year, compared

million, products Royalties primarily $XXX.X from States. related acting royalties by Janssen's million the was to partial in products sales sales INVEGA of decrease driven United XXXX. were of the in INVEGA the agreement long $XXX.X termination to acting The the of compared long on

finding to the to an the under in related tribunal’s agreement. agreement that award, and are Arbitration paying a the last had month the We'll tribunal Janssen Janssen that pursuant award. not issuance proceedings continue issued interim tribunal developed the may sell of prior royalties products this final engage we with proceedings without continue the to to matter and to announced ongoing, additional

expenses. $XXX.X focused to investments key million, development $XX.X of year-over-year Cost program were primarily sold and receptor reflecting million, neuroscience XXXX for program. programs, products. in for million by the R&D expenses to manufactured stage $XXX.X operating billion volumes including approximately now goods $X.XX earlier Turning in the driven the and of of for year. expenses Total oncology orexin higher of X first nemvaleukin human were study XXXX clinical our initiation agonist increased our a

expenses R&D $XX.X increased to related million $XXX.X in prior expenses the million compared investments year, the as This $XXX.X year. of for to prior XXXX primarily of million LYBALVI. the to of in launch SG&A compared

our $XXX XXXX balance million ended We year. well-positioned Alkermes approximately of of approximately investments debt total position to sheet, Turning is from and positive $XXX with net of We million. at perspective. end cash $XXX in had and the total a the with cash approximately outstanding million cash a

financial for the I'll assumptions. underlying to now our shift XXXX expectations and key

our our oncology reflects year receptor the launch investment and proprietary of agonist management, will continued progress the with continued strategic expected studies, we including clinical for shareholders, guidance products, of and priorities believe of that focus orexin the expense LYBALVI, and value on growth growth drive for our in X the of disciplined in program advancement business. So, separation

toward financial year. The as neuroscience currently for and reflects planned complete we which are the business the full-year work separation, today the the providing expect second we of to half combined oncology guidance we the in

As and come of the the clearly our year more will into work focus. planned separation timing progresses, precise

the embedded I'll outline the business spend combined and of related within discussion these Following oncology expectations. guidance, separation

order assumption due current to long the to these is our acting terminate three-month markets. the revenues reflect sales in also of we period end in May receive of the U.S. will through that year continue this would products related provide to notice the agreement required be the outside that for expectations the to financial INVEGA Janssen to XXXX. Our royalty And

long We acting our guidance revenue to to in will the proceedings potential ongoing. with payments the sales royalty any from these Janssen continue products exclude related royalty as arbitration of to related INVEGA are U.S.

of does targets in flows of has I of underscore in in engineered the legal not planning the purposes leverage want business, and these This is the the for and approach providing our picture driven our that in a removing proprietary only profitability clearer operating guidance underlying Janssen the our and belief matter. strength by VUMERITY benefit to of products any position also that our strength this we've business. cash reflect into from way the

I'll issued financial full XXXX now this highlights expectations walk X-K through and our press outlined the in expectations of were the release and the morning. the

expect in So, range for to we billion. be $X.XX line, billion revenues total top the of to the $X.XX

our contracts. if half For start range half of commercial enter our This We net the remain the year, million LYBALVI. I'll and of for could and $XXX continued any adjustments proprietary of gross currently to sales demand into to growth in XXXX. net the range LYBALVI the during $XXX with products, additional stable million second first current then widen will expect reflects in we expectation the fairly

net and in For to million expect range of million expect $XXX we for million $XXX range $XXX sales VIVITROL, the the net ARISTADA, in $XXX to we sales million.

of volumes are increase to terms primarily expected increased products. manufactured $XXX by key operating to XXXX, of $XXX cost sold goods a of million, expenses to range million In of our driven for

the R&D $XXX expected studies which enabling expected well range year. be the for the the in nemvaleukin, of registration to program, proof concept is for as patients million to of development orexin as the the initial driven yield of in in expenses investments data by are clinical to $XXX early potential end by million,

in $XXX for and million primarily to separation of of year-over-year the increase strategic LYBALVI planned $XXX the be are in range related business. to investments expected The to expenses million. DTC SG&A reflects campaign the the oncology costs

$X to income in to non-GAAP loss and of of be net $XX million. $XXX GAAP million the net range range in to to million be million we expect the We $XXX expect

related expense the infrastructure the the of building combined spend oncology as transaction approximately mentioned, costs provided include business. our and with these $XXX million to a advancing ranges, financial at to neuroscience publicly traded line I and a full-year of business As standalone expectations company. oncology Overall, oncology associated operating the the the and separation planned support of reflect the business midpoints necessary items

business we progress available refined year. neuroscience in oncology various general the may This be A more separation intended a detailed assets framework to provide is enhance about of the is components planned the is expected thinking the of business. accompanying slides breakdown estimate illustrative to The the webcast. the the and for of profitability as remaining through the

updated in XX% in new reflect targets today acceleration To XX% net XXXX XX% announced profitability a XX% our targets previously targets. increasing reflect to profile, increasing XXXX this our improved specifically targets and margin in The our targets to in and income we provided non-GAAP financial XXXX EBITDA one-year and XXXX. margin and long-term of

the as worldwide completion profitability of revenues of in improved these well the planned acting all the products, clarity, long as INVEGA royalty removal separation assume to For XXXX. targets and successful the related sales of to timely continue

separating we has expect business the step profile significantly which virtues margins. also emerge the allocation making, simplified a top line, with we of operational and financial taking expanding growing and oncology enhance back, many a will will structure, capital the neuroscience cost resulting streamlined believe a decision So, company,

as we and reflection you driving The to forge updated are we a our and growth provided on long-term and look targets profitability our accelerated updating to profitability of commitment today ahead. forward progress

that, over And Rich. call hand I'll with to the

Richard Pops

That's Thank great, Iain. you.

talking execution as Alkermes. point at of ahead to XXXX, our XXXX of I the a turning lies about So, for before note want the in what significance strategy

we evolving double-digit on our neuroscience VIVITROL launch revenue top the strong With ARISTADA as LYBALVI growth for is of planned. business and of

oncology receptor Our enrolling standpoint, our investments clinic. and with showing expense financial also efficiency, our orexin studies And in operational the promise registration in entering nemvaleukin in enabling are and progressing R&D we profitability. X agonist management, focus on sharp and continued disciplined driving a from

execution, we R&D establish to a and new is elements these in last which year, mind, in going of accomplishments the focused operational were the financial the build key important areas. on all business three on one be company. XXXX an trajectory discipline, year XXXX. with We're managed commercial We evident productivity, for in

our each narcolepsy the of on in businesses. They these planned launch for ongoing priorities can program oncology the disorders, advancing and driving We orexin of and other significant value are executing separation of our shareholders. sleep LYBALVI, believe drive our

So, little time them a I'll each spend starting on of with LYBALVI.

confidence traction in its of strong The gives us in LYBALVI launch XXXX the potential.

have practices. of differentiated in healthcare their first progressed, weight in profile noted launch providers comparison LYBALVI’s own [olanzapine] year to the [ph] As

proven in is be and its world clinical long-term which provider Looking in efficacy, along our in of potential pivotal ahead, healthcare established trials, and LYBALVI we demonstrated rooted the this experiences. clinical olanzapine real patient market believe grounded will in efficacy with

focus the from and breadth building play trajectory a XXXX, category LYBALVI by Major area caregivers build awareness role in of clear So, will characterized a driving as you brands growth and access time this over Todd, and base, changes campaign have and we prescriber driving the significant patients of we in believe the its this frequent providers. heard healthcare millions DTC medications. disease that is enhancing in steadily in further among in patients profile,

We're its patients, for drive new but treatment for that as excited option potential represents opportunity also growth about LYBALVI a to at the Alkermes.

the XXXX, potential orexin other represents sleep ALKS X and narcolepsy advance strong pathway neuroscience disorders. relevance narcolepsy our the to biological agonist program in in to opportunity exciting both is significant program priority market opportunity. This second an of The orexin receptor and given the

chemistry designed and the develop to cataplexy. capabilities small linkage potent standpoint, natural We've neuropeptide From orexin capture pathway The and performance the strong molecular one of endogenous affecting wakefulness agonist is disease. in pharmacokinetic the molecule between our a challenge the highly scientific to orexin expertise and there's leveraged a design. of

our attributes in an is it its We promotes year during component started night. the and Potency quickly. safety, is preclinical we convenient wakefulness in can and coupled first last human the penetration not a dose. Based XXXX efficacy these profile with fourth ALKS pharmacokinetic we're enough must sleep that moving It and of study with on modeling a be embody that essential once for at daily and own. quarter the believe XXXX in but on CNS day work, for

modeling far, dose We've been what now profile single study preclinical and dosed relevant well and volunteers tolerability several safety and in the in into are Thus therapeutically in our cohorts healthy with narcolepsy. studies. a dose in should ascending that be levels we consistent good indicates we has observed

the We've been to target to single We dose study initiation study engagement. collecting to coming have healthy seen and XX data are XXXX following trigger ALKS single multiple days. the of clear designed enrolling of weeks. dose expect EEG levels doses for the subjects study daily of early in This volunteers ascending dosing sufficient involves in the begin dose signals in and ascending encouraged

We a of also X, [Technical Difficulty] to study maintenance and such as type endpoints clinical plan hypersomnia. of proof narcolepsy efficacy to wakefulness idiopathic initiate evaluate narcolepsy X, type concept Phase in traditional Xb

Operator

and please gentlemen, Ladies standby.

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Your conference joining momentarily. you thank today. will resume again, for Once us

resume Instructions] [Operator you. teleconference momentarily. Your Thank will

gentlemen, for by. and Ladies standing thank you

Our now teleconference will resume.

Richard Pops

today. some having telecom We're Apologies. Okay. issues

wakefulness, deprived probably the most in of study off. about narcolepsy looking which we're to X, narcolepsy that's hypersomnia, proof actually and test So, at efficacy I sleep going And up patients narcolepsy launched was concept was Phase as the I of maintenance I'll healthy important study, with X, idiopathic endpoints. that Xb in one where is volunteers. in that'll we underway as traditional clinical was the I point program. as begin type our well the pick making And type left the talking

data the these preliminary the concept together, studies generate to designed end taken by of year. of proof are So,

significant with economic to create medical that potential, shareholder this strong value. So rationale, a biological offers and we believe program and opportunity considerable an

our So, the with and we to forward while program you throughout progress we'll continue and year. carefully to focus the careful on look advancing sharing execution, expeditiously

the neuroscience both success priority thesis value will each separation and business third for for of We we year business. business our simplify oncology position investment the Finally, and separation the if is allocation capital oncology the for business. and complete to as unlock the believe and growth remaining the decision the we completed making

and engineered a potential pathway of side advanced data investment first-in-class is of development thesis. in has oncology. nemvaleukin, the and variant significant the offers investigational checkpoint showing novel The by business with generated compelling in cancer activity the in potential standalone most IL-X potential oncology a distinguished anti-tumor variant is IL-X IL-X single as the our Nemvaleukin the clinic monotherapy immunotherapy. in inhibitors. combination that's Anchored The by agent

melanoma efforts monotherapy in with ongoing potential on ARTISTRY-X registration are Our enrolling focused is pembrolizumab are difficult year. this nemvaleukin in is will ARTISTRY-X continue cancer. These two enabling platinum-resistant blinded nemvaleukin’s current treat evaluating studies development and to tumor mucosal evaluating studies in and in both types. ovarian combination

company preclinical addition, post new other In the oncology programs. immunotherapy would have a separation pipeline of

Our tumor IL-XX attractive which target and represent engineered targets. advancing development and both oncology preclinical engineered have of IL-XX, been

assets late class separation the the a asset preclinical with the medicine, milestones, potential clear and for oncology first potential be So, opportunity a business oncology represents investors. pipeline of believe stage compelling the focused we to with developmental in

you of So, I'll status the separation. planned a update give on the quick

oncology our into an separation we spinning options company is business the evaluate publicly-traded the business, range While to planning oncology of independent a of continue for the scenario.

the providing that other We deep has separations engaged knowledgeable transactions. as experience in leading as and separation efforts, have a an expertise board well oversight and team

matters, tremendous and planning, public governance listing company amount related tax and a There's SEC of corporate structure. work underway organizational to requirements

process. we're of recruiting terms candidates leadership leadership And In the with CEO is underway. other level interest of oncology the caliber the positions and company, coming post the in pleased separation the for through of for the well process

and final Board making approval closing the half in Directors. customary subject to separation] the [ph] XXXX, complete from we're including [pros streams, of second work progress expect the to of Across conditions,

heritage space the significant neuroscience. focus company. on to play this on profitable a unmet of separation, in needs innovation planned and neuroscience expect within Alkermes pure we excellence with our Following therapeutic build Alkermes will a become to continue

infrastructure the neuropsychiatry significant top sorry, strong by proprietary medicines represents specialized profitability, neuroscience business disorders. our growth, advance and leverage, in stand-alone proven and potential growth this capture line drug neurological new growth of commercial a to operating addiction for and I'm capabilities, products, drive opportunity development driven and a With a

will operational we're a XXXX with for to enter forward and value with significant the our So, there momentum shareholders. path all I well-positioned aspects We finish create clear of for business.

So, don't I'll to with that again we that, line turn can Sandy. it Hope the we drop the back run and Q&A.

Sandra Coombs

Thanks for will right. All now. Q&A Rob the open call Rich.

Operator

you, Instructions] Thank Thank [Operator you. Sandy.

Our first question today comes from the line of question. David your Amsellem with Piper Sandler. Please proceed with

David Amsellem

thanks. Hey,

and to with the in there's the as you So, SG&A this investment growth a understand on you – continued I not R&D result Can assume how just the And to in longer-term that what what considerably are between And going wanted seems more better talk orexin drill targets. product. the infrastructure trying pretty down be about of the should margin just context R&D in the I'm further balance in I spend like to business? is, but SG&A lean investment just thinking and on a considerable year, about neuropsych in clinic? we the promotional LYBALVI, guess

Thank takes, frame us and help those Just you puts if will? you.

Todd Nichols

margin sure incremental to for One, for DTC couple on the looking growth continuing to you've really maximize be obviously combination on the be big the as we're line long-term next things. two opportunity of slowdown line. top So revenue line. to a got a revenue that hit us driver targets. of over to campaign make we'll LYBALVI, LYBALVI of the invest order is And the to to to it's in able in the the we much said, bottom then have top targets, the going be years. And That

we lot campaign. a launched year [ph] [learned] in we've digital this as think I the first

digital launched the we campaign We then and TV campaign. the have launched

profitability be be the discovery and oncology forward at pipeline then early the invest we'll some R&D a from us. our it model work realize to assets. we'll years then been for But few an programs focus so tenant need also maximize that we overall from insourcing R&D to some also fine and so longer-term, investment. of to continue But is is key tune, into for perspective, into able the leaner looking we engine the will So, effectiveness organization as potentially have going the doing the And has for a on that future. It well. the to be last absent

David Amsellem

you. Thank Okay.

Operator

question proceed with Jeffries. is from of Tiwari Our Please your Akash the line question. next with

Akash Tiwari

a XXX few Hey, the so if I can. have expectations income on put to to since net spin, toxicity am an patients year? On XXXX toxicity feel to with Phase particularly trial] period [ph] your the have in number as fair mind, this planning Thanks. in you in dose to your on here long-term how healthy much. internal or even to seem of are or this a [Takeda's OXX] in your that is year of you're just do any wasn't close [ph] LYBALVI that's Maybe missing around thanks I unless it to you liver I say show after something program, up a trials about de-risking going extended for I targets guided safety, [MAD liver then month of guide, grown product orexin million, that into last the and With dosing. your a trial? time And getting you your on Xb enter

Todd Nichols

our on is, we targets, So, profitability expectation or not sales provided we peak so haven't today. and our I expectation do what will long-term long-term will the say

three our by the which for going the line driven all growth products growth As be I us. the of that will key get VUMERITY to mentioned achievement as of through of well, the really to bottom flow proprietary and to is targets profitability a of be

to down that in the flowing revenue And mentioned to that able order growth today. to in achieve obviously, then as out set I we previously, bottom the line targets be

Richard Pops

maybe orexin question. Rich, take it's I'll And the

is X largely the those proof that by is because to orexin than seen architecture structures cycle the of the question, idiosyncratic view best engagement agonism toxicity dose. affecting per way interrogate se. particular sleep this other But the to the and Our establishing is interrogating toxicity the appropriate compounds that are wake establish concept from in rather objective to potential year target of dose the longer-term at

interest. into Now, in and a clear the going feature potential know that itself potency. to optimize maximize design being of was or really the around that for never program Potency until answer to objective at get minimize But in the exposures design fully population patient injury. indicate as off-target the the doses liver longer you induced you drug relevant of to question you'll

Operator

next Evercore of your Umer the with is Raffat with you. proceed Please question The Thank from question. line ISI.

Umer Raffat

question. my Hi, guys. for taking Thanks

launch First, maybe on I metrics. perhaps on LYBALVI. the the appreciate color all

the be about number prescriptions per new that over and there's been thought fairly I ads. Something given thinking more stable. to prescriber time, prescriber just of prescriptions And have refills appears I've the is would per

Just the is being by prescribers that? trying the on TRx more really understand signing any color on, if new would to appreciate driven growth

could Thank between cohorts if secondly, notable or trial [ph] the a are there's on how And seeing you could you. you've the the Rich, these and it formulations the if orexin the Part you is difference formulations that trial, X also you seen on MAD? to for in are also clarify [SAD] And orexin? data many speak

Todd Nichols

month-over-month breadth by the off seeing we're of I'll prescriber start with, Yes, quarter-over-quarter encouraged prescribing dynamics overall. a really and with kind basis. we're seeing base. on It's what consistent of We're the

is – encouraging Your right. continues now grow. stable, to the sign Overall, our an breadth question prescriber breadth but of of depth prescribing relatively because right actually prescribing is that's is the

as new of right prescribers Iain encouraged have So, DTC consecutively And X,XXX off we going the we're prescribers over the light as we component mid-year written launch. as [Launch prescribers campaign earlier, continue we next lot we see product. of couple year. of advance to today] now bring our aspiration is our [ph], that's from expansion to coming that this to as approximately the on at quarters a the actually new And board. said the grow continue

Richard Pops

Umer, it's Rich.

Just to was echo what Todd saying.

Our try when LYBALVI, experience is they like physicians it.

depth. driving in [indiscernible] prerequisite our – in view, So, breadth the is operationally driving

way a hunch So, ask maturing. the excited question I about think breadth about is I we're you’d orexin. had a the the

because we're the learning phase data that dose, from this development now tolerability, the say I'd what is incredibly So, doses. ascending informative first is is so SAD seeing about an program the cohorts, obviously, of right the an single-ascending we're and

in at tracks be a medicine evidence and PK PK just at high looking modeling, now from of with our of which how to volunteers, to we're appears translational EEG is We're And idea to engagements. quite target a view, We're that also dose. that's seeing where We're back that point single point. purely see that. this consistent deprived quantitative non-sleep the beginning about healthy following excited fidelity

now MAD. go The on will operational MAD light and ethics off the soon approval very with cohorts

be next weeks, at the XB, So, followed that start-up patients. should in the which by few in we'll looking

Umer Raffat

you. Thank

Operator

from comes with Please Chris of question. is question line Shibutani with proceed your Sachs. the Goldman Next

Chris Shibutani

net Two you'll from questions. see of might a to further Is Could talked this potentially Thank One, talk as access point, to still gross emphasis? there, you it? bit the kind in Ultimately, lot for what what standpoint a opportunity what how at about Great. you, very enhancing you in of you, on? of much. the the thinking profile you I I've and know base your the then of impact mid-year trajectory. clinical sort differentiate? positioning how do agonist that heard that competitive aspire elaborate very potency about terms orexin little really that about perhaps the profile can in vocabulary. we're you a And just of development, early

Todd Nichols

Yes. I'll the market start question. with off access

and now remarks, payers be half commercial with second the is access net category to contact way is market with in is constant think the said about them. is in stable that we discussions relatively this in We're in to think stagnant. expectation not the that really I coverage of year. and And to prepared the could right gross going our the it first of the the over evolve half As year,

dynamic. a continue versed the And tells can to this and we've done evolve will work us they this is this – is really that are time. over navigating really and categorized market actually step-throughs, HCPs all and well PAs, area, with medical that in manage the exceptions It they category is by that this

all about a access. be just mixture support access. contracting we pathway talked combination and going to providing patient have to of a we the to a So, lot plus programs That's a

we access and believe have ongoing to across of For utilization market positioned. We're right our patients payers. our programs, our all programs, access. majority LYBALVI seeing now, these with programs, really a vast well we're are good co-pay PA The of pathway having we discussions

position. need wouldn't position, if the so, see second year, to enhance but the to need strategic in to of do now, at we'll that strategically that we we do So, that the we'll a we and that right look determine looking half really without happen investment if enhance or

Richard Pops

question on benefit. you feature, is glad orexin not asked a it's potency because necessarily And the I'm the but a stuff, then Chris,

long-standing parameters same. So, clinic of in compounds the to think And benefit don't optimization been all what a see that they're going this different. quite evolving of way molecule. number the molecules is this my the there's these So, are different I going we that be to belief has all these the potency? is of different be in design

be along injury the Even same cycle, the on safety. might the [indiscernible] wake AE very liver because or two and others. stipulated that one drug-induced is they the or these engage very, blood not not effect rate. be pressure, PK. And potency, seen one We've it's on is of they several be if different, think heart could may our may may we also from sleep they just receptor, different if focused be but already toxicity on-target Number cardiovascular construct of have stages, that parameters. because you'd in Number

could respect differentiate, that is these with also is which PK the And relevant insomnia. absence or another of point presence on to entirely

they back and too before extended return and brief don't too if baseline to period it’s allow is have wakefulness. of extended an waveform time you to don't it's or to your to bed If go people

beginning using to this different animal So, parameters. – other optimize there's number must try the a of the – modeling each been say, program, these work to of I to of to we've and different work sensitive very seeking and be from XXXX

Chris Shibutani

you. Thank

Operator

your Our of Paul Stifel. from question. proceed the Please with next is Matteis line with question

Paul Matteis

then data think we had bit year, this later share ask a on patients POC help placebo, should in. And you. on on of those spin? expect? the Congrats for And de-risking many oncology either what other, are? how the little pulling about Hey, in understand profitability orexin wanted discipline that? data just there are again, expectations targets. by Thank taking things how that are pull-in much could change on you is just that that, to thanks question these another of will my question. or, I in driven additional duration I more that like revenue Like drug, kind so factors, embedded us More any just cost specifically, granularity treatment, things the much how

Iain Brown

take Paul, the Okay. I'll question. profitability

So, the ongoing the table the you oncology $XXX of at – look within the provided of brings spin million quite the spend little costs come assets, about down at out slides, that would it's the of round-about midpoint that if R&D obviously, significantly oncology the we P&L.

at the This the we're you the of full-year what see with going same half of DTC campaign. of in TV. time, I think to investing doing year, a year potentially in and as digital continued we're launch a XXXX, LYBALVI have

growth is revenue marketing to within to to DTC line flow within So, and hit the top – the you some on incremental for line. going again, revised there on the investments really line. bottom with the predicated targets be ability down sales could see these But

on management targets really achieving in previously help profitability that's than is the cost really focus year anticipated. that So we us earlier continued – one going to

Richard Pops

we into deliberate. with MAD well modeled safety of be basis, as the EG you Umer it's you XXXX gives as Paul, And information. Rich, where orexin is mentioned us MAD And before, the into as provides XX therapeutically very doses, work start concentrations. additional with steady-state exposure to clinical PK sequencing relevant clear and days I on the SAD tolerability of getting as particularly progressing a

Xb idiopathic well representation would circa patients, The as XX hypersomnia with You deprived be XX or across NTX, individuals. NTX, I as will move say, sleep into the Xb.

reliable each So, see of those registration, disease different for end the for this that the the you'll or wakefulness effect which – against enough test, is to the which should cares syndication. across categories, get on be of having of architecture which drugs one fairly you're maintenance marker primary point about a phenotypes in sampling activity whether a these is sleep

Paul Matteis

much just Rich, about what year-end, at XXX not But Thanks. for data like how [ph]? – Okay. [patients]

Richard Pops

be going is bit clear at that to Well, each stage. the we on only ethics approval a different little reason I'm soft because

at give start I so I more planning we but because But depending healthy so this healthy approval and timing I – the NTX, subsequent the volunteers NTX, then a volunteers, NTXs good mean, into and to least a have expect, in case they're of year. on our have ethics the – IH pretty And information is we that moving we'll you enrollment, in bit the on the idea Phase sites. little as

through see So, we'll various but logistical obviously, we'll hurdles. we as update we'll fast go – we see we'll can, – as move as these

Paul Matteis

Thanks Understood. Okay. much. so

Richard Pops

Umer's You’re And welcome. I one clinic. did the formulation. of answer which a about piece there's Different formulations. is doses, one question, formulation in

Operator

Mizuho. of proceed with from question. Ear your the The Uy is next Please line with question

Uy Ear

the start my Hi, of Thanks taking is first guess question. it guys. I it wide. my is the guidance, the question for year, seems and

some sort for VIVITROL us have take on ARISTADA provide gross in And assumption secondly, with and I would it? to Just it you of narrow could it. might color wondering Thanks. missed what guidance? the the

Iain Brown

first. last the take one I'll

year – we gross we through XX%, gross fiscal but favorability VIVITROL business it see side expect So, a year. that thought We to so to originally the the net, around XX% going with as on net. was to did some Medicaid we the the of ended XXXX went be

we anticipate favorability So, in come seeing don't through that necessarily XXXX.

the has couple remarkably stable, anticipate say, towards to then level. And back-up gross I'd of gross you'd the So, years. the ARISTADA for net XX% in been would increase that to last over see I an net that

level of would that into you, net to of the So future. to gross continue expect kind

your then guidance, why And around in as you say, question general year. early the it's

And done estimated through as we've year that to there's together. go our impact put trying of and the best we puts takes business. lots So, the could those

different example, down time we have that. could much happens in don't there. at to If But certain the growth, I on see growth mean we business. dependent is of line-by-line, and anticipating. could be built go what assumptions market Market to VIVITROL, we're think and in growth what opioid side the the you do we upon looking alcohol then dependence ARISTADA have very for – I

We've launch example. for campaign, LYBALVI the lot the on LYBALVI is with regard in got to going still phase. a and DTC

the typically some as is So, of examples through on things what the those year. are down experienced we throughout the do ranges we we, And revenue certainly few and side. we year, narrow things, the just of those obviously, of try as sort a go

Uy Ear

Thank you.

Operator

Bank Gerberry with question proceed next Our question. of Jason of line from with America. is the your Please

Jason Gerberry

Thanks guys. my for questions. Hi taking

LYBALVI about your seems mix gross like low, you're question Just are and so, like specifically. net payer the to pretty nets it ask wanted a seems to and gross to we the X, commercial sort not are not the X volatility in year insured. much side, you're heavily on but expecting, yet for like see contracted typically of that really drugs commercially It

have of So, speak two the just payer you mix that can, kind broadly to if there. indications you the wondering between

just then And quick follow-up question. a

on think I VIVITROL the patent dispute. patent Just it's case, one single in

the a [judge quick if there] So, expecting a Thanks. on from [ph]? you're pretty ruling time wondering turnaround

Todd Nichols

and we're that launched the to good program, we pay. as actually mix a exposure is, the and our launched quarter put saw much utilization. payer seeing observation. saw program overall, as – the Yes, what programs rebates net now, to we're when last off I'll Right gross we We of a in we we co-pay didn't good with number the with start fourth we into It's with product, really what place, overall year, PA we seeing had well. our see our

of For branded with which prior of of about the approved, all is example, consistent north XX% our category. authorizations are very

healthy we're a typically actually those within Medicaid. Medicare see and right mix mix think bipolar. indications, Schizophrenia, is, mix of getting schizophrenia higher also of bipolar, both I leverage the of we're in is higher seeing And dual Within what a commercial the the real and Medicaid. you we're mix schizophrenia a seeing now. patients in and

is third consistent third a about the Overall, believe LYBALVI with which settles third time we basically category, as Medicaid Medicare. commercial, out, for a be a for very for and will that

Richard Pops

And series of correct, patent. and trial. during There's are fairly on a the discussed underneath you're that will be that there's arguments a the annual litigation, patent while nuanced single

will work. So, I or judge won't slow speculate the how fast

that the QX there'll Our frame. assumption in decision be is some type time of

Jason Gerberry

Thanks. it. Got

Operator

Morgan. with question proceed next Please comes Jessica Fye with Our question. the line your J.P. from of

Jessica Fye

this as for taking example? about of sure to it sticking around When DTC make XXXX, Good we I my SG&A cost think LEVALVI the then how ahead guidance LYBALVI, million annualized to PTC the at LYBALVI for And year-over-year. much you LYBALVI, guys. Thanks Hey for about for think $XXX is guidance the up understand with quantify embedded want And imagine question. but but XXXX? XXXX relates should what's that? as think I for to sales we I we on to gross net, morning. for your can midpoint

I think that, on if additional XXs depending you and you that mentioned high first the half may in widen do contracting.

sales in that half, go opt if not So, if or what's to you anything in that route? be baked guide widening into terms would to back of the upside the revenue guidance

Iain Brown

for I'll go questions. thanks those. Jessica, take Okay, the a at

for about focused incremental marketing and DTC that XXXX, $XX the within majority you'll there's on of million sales So, and campaign. is see spend $XX million, the of SG&A,

half year of TV. So that and would be for a a of full-year digital

both full-year So, think increase of XXXX an would there a to TV XXXX, the in and if proportionately. digital, then years you was if and be there further about out SG&A

associated Also within bit included stand-alone the the type line. within and the in one-time total costs million it's the the for one-time G&A, I out separating of those infrastructure There's $XX a in building think slide entity with I have costs costs. of oncology did out little the about that business SG&A between the are and tables. we in mention, the illustrated A separation lot

looks So by than more will. is G&A increasing like that it

of range could gross net in sales And possibilities the really basis, on then that we XXX] of for a we as business half. encapsulates will be neuroscience the [XXX for costs the net part perspective no longer [ph] half with high year. range from to gross of second then the of the to business. those mentioned, Obviously, to LYBALVI, net Todd And see first XXs gave today a stand-alone the

as [ph] we year. we'll we we're more the go potential detail able negotiations That as more being So, provide [light] become today. and into will specific any be through to not enter into

Jessica Fye

Thank Great. you.

Operator

the Goodman your Please SVB. line Marc question question. next from is of with Our with proceed

Marc Goodman

with could now, you but disclosed to talk aggressive going will talk on there be side? question or side? year on want there? the about think in maybe it you're Do you something partly then year Rich, deeper Thanks. can pipeline what's I if next more just build don't CNS in morning. to about the the so? BD you I is the behind be on disclose also to trying And will discovery. Good be going know you the over happening guess scenes what's products from a a how anything,

Richard Pops

we'll aggressively that make the company Morning we've that, populate not into, Marc, behind clinic. guys as to think indicated, you But when in it's is neuroscience not about than any a it probably too visibility early you because going pipeline call it, ready, also the have it's of moving on the in-part additional need you orexin to other because given some to candidates. some but with spun

a Iain guidance So, mentioned idea has dramatic not profitability the but expanding the accommodates the and of in R&D fashion. that pipeline,

going If that And it program. because the business major the is a on the R&D. I do, a our go mean, course, as to happens line we're going accommodates we an pipeline. we're profitability ratio what spree continues become that's expansion in-line the to those orexin peer with what maintain targets. important of grows, of feature roll R&D the that's But a would to on really spending of if companies toggle hit revenue line managing with basis, to not

Marc Goodman

to the you at suppose, side aggressive how what that you, Well, I is I'm right? be. I is guess BD getting to really up want

there? aggressive a look advantage past taking couple just I'm to time be the the guess for up good years. how it out I We just that's the those like know over like curious of you opportunities. pipeline, of So, seems does It what happened to biotech sector building –

Richard Pops

that think right. you're I Yes,

through think we out of that there attracted there I there's now. wasn't time period that went a – we in really much were

something episodic the intellectual is criteria that and from find I align property for the stars when as that meets but an happens a basis as you think the perspective. market, scientific now, on well active group such

you give the it's to that hard sequencing it's any So, to priority. timing and a of that than on guys guidance other know

Marc Goodman

Okay. Thanks.

Operator

from question Douglas Tsao of the next is H.C. Our proceed with with question. Please Wainwright. your line

Douglas Tsao

taking questions. for that. about Thanks Sorry the

and of on terms the follow-up net. the a in as Just LYBALVI gross comments to

you if thinking second the that to lead the net what contract the through to half you're just get the would expansion more in curious gross about an Just whether on you would can that access year walk and to of standpoint? from how nearly decision an for

Todd Nichols

Yes, absolutely.

of So, overall. this different portion of the ways. contribution it at a from healthy and prescriptions. at And We're we're We channels. couple each see TRx’s the actually closely watching we the very look looking of actually a

said and see that in my schizophrenia, and remarks prepared I amount flowing with As Medicaid are healthy Medicare. through earlier of also with we prescriptions but bipolar a commercial, on

we're the that in those had have LYBALVI last that we'll thinking think our access, we continue about are are points aspiration need with commercial profile So, it payers. the within way. watching we're that if right have. one is very flow market have through. seeing well-positioned We is discussions And now enhance right to that closely. then access And those we we of to we and really that now And any that this decision year. those the are also discussions because And year, support we prescriptions

overall have We There's profile. providers research the in authorizations, of of agents most this a as similar step branded category, market prior general fair in that well. with at think exceptions. a its amount they do always And medical

point decision into too. well, think really goes But overall, we're our that So now, well-positioned. we as right

Douglas Tsao

Thank much. Okay. Great. you very

Operator

you. Thank

of with your Our Please final question Folkes is Fitzgerald. question. line the Cantor proceed from Brandon with

Brandon Folkes

Hi, SG&A you. infrastructure, to headcount, neuroscience the the currently, On given driving I XXXX just those operation in and Thank question. targets? of growth XXXX how about just spend. and to come for breadth commercial maybe your taking is XXXX LYBALVI, think my embedded and profitability the back in do you want thanks prescribing

Iain Brown

Yes.

we were without it have have infrastructure. I three VIVITROL, that think into start infrastructure. by the commercial think built products Initially, able and today are products that with to three I is supported the now growth built future us it the spend additional We infrastructure needing we support ARISTADA. And going leveraging for all for the we to to money. we've

this DTC and on But said, the the up. are grow of SG&A certainly incremental the campaign marketing side really years. on sales going is the around to to think couple this investments year revenue as idea DTC both I line or the I in campaign, between side and that move or in be the next

but we're assuming we as learn going see DTC, we to that, So, will adjust to able get and as a lot we that we continue we'll appropriate. into investment invest the in program, deem to be

Brandon Folkes

Great. much. Thank you very

Operator

go Please ahead, Sandy.

Sandra Coombs

everyone, call bearing available day Thank us you. us. We'll All right. the for Apologies us. with Thanks, all today. joining and if you need difficulties technical for on the be

Operator

conference. This will conclude today's

your disconnect your may at for Thank you this participation. You time. lines

Alkermes (ALKS) 16 Feb 232022 Q4 Earnings call transcript