Q1 2021 Alkermes Plc Earnings Call

And <unk>.

Along with me.

Greetings and welcome to the Alkermes first quarter 2000, and Tony on earnings call. My name is Rob and I'll be your operator for today's call.

At this time all participants are in a listen only mode.

And and answer session will follow the formal presentation.

If anyone should require operator assistance during the conference. Please press star zero from your telephone keypad.

Please note this conference is being recorded.

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

Thank you good morning, welcome to the Alkermes plc conference call to discuss our financial results and business update for the quarter ended March 31, 2021 with me today are Richard Pops, our CEO, Ian Brown, our CFO and Todd Nichols, our Chief commercial officer before we begin and I encourage everyone to go to the investors section and.

Oh for me is dot com to find our press release and related financial tables, including a reconciliation of the GAAP to non-GAAP financial measures that we'll discuss today, we believe the non-GAAP financial results in conjunction with the GAAP results are useful in understanding the ongoing economics of our business.

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

Those expressed or implied in the forward looking statements.

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

Great. Thank you Sandy and good morning, everybody.

The first quarter's solid results were driven by our focus on commercial execution and disciplined management of our cost structure.

And and Todd will take you through the Q1 performance in detail, but at the highest level. We are on track to deliver on our financial objectives for the year and over the longer term consistent with our value enhancement plan.

The way, we create value and biopharmaceutical companies is by making important medicines medicines that address.

Unmet needs of patients alkermes.

Alkermes is an exciting point and our evolution, we've achieved $1 billion top line driven by our portfolio of marketed drugs.

We've developed specialized commercial capabilities and we've identified new revenue growth opportunities with the expected launch of <unk>, which would be a second antipsychotic and our portfolio.

And the anticipated growth that would be Meredith and drug for the treatment of MFS, the redeveloped, but being sold by Biogen.

Coming next and we're focused on new neuroscience and oncology development candidates.

And our objective is to develop truly innovative medicines with a clear value proposition relative to current and anticipated future standards of care.

We do this through developing new molecular entities based on strong biologic rationale and leveraging our established strength and molecular design and both small and large molecule.

And our recent Investor day, we announced new development programs that reflect this approach.

And neuroscience are cool rest selective <unk> inhibitors have the potential for broad utility and.

Degenerative and Neurodevelopmental diseases and are advancing toward first in human studies later this year.

Our orexin two receptor agonist program Leverages, our core competencies and small molecule medicinal chemistry, and pharmacokinetic and formulation expertise with candidate nomination planned for later this year.

Oncology, we have developed a cytokine engineering capability that is yielding innovative new approaches to some of the most challenging and high potential immune modulation pathways and.

In addition to nimble Lucan, our most advanced oncology clinical candidate and we also highlighted our preclinical work engineering, a tumor targeted split IL 12 fusion protein and unveiled our IL 18 program. These presentations are archived on our website.

Each of these programs is designed to address specific unmet need in neuroscience and oncology and are designed to have clear competitive advantages. We test those assumptions throughout the development process. If a kennedy doesn't meet these pre buy specified criteria, we stop investment.

If we create value through new medicines, the way, we can enhance that value and make it rewarding to shareholders is through and equivalent focus on structure and efficiencies and profitability.

The value enhancement plan, we introduced in December of last year furthers, our focus on business excellence and makes explicit our intention to increase efficiency and profitability.

It also provides a framework for allocating capital and prioritizing investments and our major cost areas of commercial and R&D and drives a clear focus on programs with the highest expected return on investment.

The combination of scientific excellence and business excellence as a powerful concept that we've incorporated into all the aspects of the way that alkermes at operates.

And it's what will drive our ability to grow value and the future.

So now with that as introduction I will turn the call over to Ian to review the first quarter results.

Thank you rich and Hello, everyone.

This morning, we announced solid financial results for the first quarter the derived from our two principal areas of focus.

Driving topline growth and disciplined expense management.

Based on these results and our expectations with respect to the ongoing recovery from the COVID-19 pandemic.

Today, we are reiterating our financial expectations for full year, 2021, which will fully outlined in our press release and 8-K filed back on February 11.

For the first quarter of 2021, we generated total revenues of 251 $4 million driven by the solid performance of our proprietary commercial products and our diverse portfolio of manufacturing and royalty revenues, including notably the continued acceleration and the uptake of humanity.

And with operating expenses lower than the first quarter of 2020 across all line items, we achieved a GAAP net loss of $22 4 million and a non-GAAP net income of $17 8 million.

<unk> net sales and the first quarter was $74 5 million.

These results reflect a 6% decrease and units year over year due to continued pandemic related disruptions and the treatment system.

Despite this Q1 net sales were ahead of our expectations for the quarter driven by higher unit volume and some favorable gross to net adjustments related to Medicaid and lower product returns.

Gross to nets were 51, 5% and the first quarter as compared to an average of 49, 9% in 2020.

And in Q1 inventory levels decreased by approximately $2 $3 million to a more normalized level and is consistent with typical seasonal patterns.

Turning to the average startup product family net sales and the first quarter increased 9% year over year to $55 $4 million, primarily driven by underlying unit growth.

As we anticipated on our year end earnings call in February I reached out and net sales declined sequentially due to a decrease and inventory levels and the first quarter.

This inventory fluctuation represented approximately $8 million and we ended Q1 with more normalized inventory levels.

Gross to net adjustments of 53, 3% and the first quarter were consistent with 2020.

Now, while I reached out and demand has been resilient throughout the pandemic, we have seen and impact on overall market growth, particularly related to new patient starts and Todd will provide more detail on that shortly.

Moving on to our manufacturing and royalty business in the first quarter on manufacturing and royalty revenues for $119 $8 million.

Compared to $116 three and the prior year.

This increase was driven primarily by accelerated uptake for <unk>, which contribute which contributed $13 $4 million in the quarter.

And growth of royalty revenues for me Vegas is center and <unk>, partially offset by lower year over year risk, but on constant revenues driven primarily by lower manufacturing volumes.

Total operating expenses were $267 9 million for the first quarter down from $283 6 million and the same period and the prior year, reflecting our continued focus on disciplined expense management and our ongoing investments and programs. We believe will drive long term.

And the value.

R&D expenses for the first quarter were $92 3 million compared.

Compared to $93 3 million for the prior year, reflecting investments and <unk> and the earliest stage H Tac and Orexin platforms.

SG&A expenses for the first quarter were $125 2 million compared to $133 4 million for the prior year, primarily reflecting savings across the commercial organization.

Turning to our balance sheet, we ended the first quarter, well capitalized with approximately $627 million and cash and total investments and total debt outstanding was $298 million.

We continue to focus on capital allocation on the highest return on investment opportunities that are consistent with our long term growth strategy.

Rob: The City Streets, you used to walk along with me. Greetings and welcome to Alkermes' first quarter 2021 earnings call. My name is Rob, and I'll be your operator for today's call. At this time, all participants are in a listen-only mode.

Priorities are clear.

Supports our commercial portfolio to drive top line growth.

Rob: Every question and answer session will follow the formal presentation. If anyone should require operator assistance during the conference, please press star zero from your telephone keypad. Please note, this conference is being recorded. I'll now turn the call over to Sandra Coombs, Senior Vice President of Corporate Affairs and Investor Relations. Sandy, you may begin.

Invest and the potential launch of <unk>.

Advanced <unk> and development program and seek partnership opportunities.

Develop the newest pipeline programs emerging from our neuroscience and oncology platforms as we unveiled at our recent Investor day and.

And explore other strategic opportunities around non core assets, including early stage R&D programs and royalty streams.

Sandra Coombs: Thank you. Good morning. Welcome to the Alkermes Plc conference call to discuss our financial results and business update for the quarter ended March 31, 2021. With me today are Richard Pops, our CEO; Iain Brown, our CFO; and Todd Nichols, our Chief Commercial Officer. Before we begin, I encourage everyone to go to the Investor section of Alkermes.com to find our press release and related financial tables, including a reconciliation of the GAAP to non-GAAP financial measures that we'll discuss today.

We believe that we entered the second quarter with a solid foundation for long term value creation and are well positioned financially to execute on our strategy and I look forward to updating you on our progress.

And with that I'll hand, the call over to Todd to review our commercial results.

Thanks, Ian and good morning, everyone I am pleased with our commercial team's execution and the first quarter with both aerostat and Vishal Q1, net sales slightly ahead of expectations.

Sandra Coombs: We believe the non-GAAP financial results, in conjunction with the GAAP results, are useful in understanding the ongoing economics of our business. However, our discussions during this conference call will include forward-looking statements, and actual results could differ materially from these forward-looking statements.

Our first quarter results reflect solid underlying unit demand and typical seasonal inventory fluctuations.

Based on our Q1 results and current trends and the treatment landscape. We believe we are well positioned to achieve sales within our full year guidance ranges for both aerostar and Vishal.

Sandra Coombs: Please see slides two and three of the accompanying presentation, our press release issued this morning, and our most recent annual and quarterly reports filed with the SEC for important risk factors that could cause our actual results to differ materially from those expressed or implied in the forward-looking statements. We undertake no obligation to update or revise the information provided in this call or in the accompanying presentation as a result of new information or future results or developments. After our prepared remarks, we'll open the call for Q&A. Now, I'll turn the call over to Richard. That's great! Thank you, Sandy.

And taking a step back and COVID-19 related disruptions continue to impact patient access to treatment and both addiction and serious mental illness and Q1 as we anticipated.

We continue to believe that patient access to care will improve as we approach. The second half of 2021 as vaccinations continue to rollout across the country and capacity restrictions ease and settings of care.

Richard F. Pops: Good morning, everybody. The first quarter's solid results were driven by our focus on commercial execution and disciplined management of our cost structure. Iain and Todd will take you through the Q1 performance in detail, but at the highest level, we're on track to deliver on our financial objectives for the year and over the longer term, consistent with our value enhancement plan. The way we create value in biopharmaceutical companies is by making important medicines. Medicines that address the... Unmet Needs of Patients. Alkermes is an exciting point in our evolution.

We've also seen encouraging trends and leading indicators such as new to brand prescriptions for both vivid trial and error start on the first quarter compared to Q4.

We continue to execute on our hybrid promotional model that incorporates both in person and virtual engagements.

This model was implemented in response to the COVID-19 pandemic last year and it has allowed us to quickly adapt and this highly dynamic market environment.

And while virtual engagements have and critical to maintaining continuity, we look forward to increasing and person engagements.

Richard F. Pops: We've achieved a billion-dollar top line driven by a portfolio of marketed products. We've developed specialized commercial capability. And we've identified new revenue growth opportunities with the expected launch of Lobalvy, which will be a second antipsychotic in our portfolio, and the anticipated growth of Vumerity, a drug for the treatment of MS that we developed but are being sold by Biogen. Next, we're focused on new neuroscience and oncology development. Our objective is to develop truly innovative medicines with a clear value proposition.

We have seen these engagements pick up through the first quarter with our sales force expanding the percentage of their in person calls for approximately 50% and March up from 40% in early January.

Now starting with <unk> net sales and the first quarter were $74 5 million.

Consistent with seasonal patterns.

<unk> net sales declined sequentially due primarily to the drawdown of Q4 inventory build as well as slightly higher gross to net adjustments as Ian outlined.

COVID-19 disruptions to the addiction treatment systems continued to negatively impact for the trial and Q1.

Richard F. Pops: Relative to current and anticipated future standards of care. We do this through developing new molecular entities based on strong biological rationale and leveraging our established strengths in molecular design, both small and large molecules. At our recent Investor Day, we announced new development programs that reflect this approach. In neuroscience, our co-rest selective HDAC inhibitors have the potential for broad utility in neurodegenerative and neurodevelopmental diseases and are advancing toward FIRST in Human Studies later this year.

And we are still working back up towards pre pandemic unit demand levels.

And then Nick related restrictions broadly impacted patients' ability to access to health care system for treatment and impacted utilization of visual and particular due to the requirement for injections and the need to be opioid free before receiving treatment, which often requires detoxification and medical setting and the nature of substance abuse treatment.

<unk> of care generally.

Now we have seen stabilization within the opioid dependence since the pandemic lows, but continue to see restrictions and settings of care that have yet to fully increase their patient capacity, most notably residential treatment centers correctional facilities and other government treatment locations.

Richard F. Pops: Our OREXIN-2 receptor agonist program leverages our core competencies in small molecule meniscal chemistry and pharmacokinetic and formulation expertise, with candidate nomination planned for later this year. In Oncology, we have developed a cytokine engineering capability that is yielding innovative new approaches to some of the most challenging and high-potential immune modulation pathways. In addition to Nemba Lukin, our most advanced oncology clinical candidate, we also highlighted our preclinical work engineering a tumor-targeted split IL-12 fusion protein and unveiled our IL-18 program.

However, and our recent market research about 50% of health care providers that we surveyed reported a slight to substantial increase and AED and <unk> patient volume in March compared to the prior month.

And alcohol dependence, we have seen a resumption of growth and the market.

Richard F. Pops: These presentations are archived on our website. Each of these programs is designed to address a specific unmet need in neuroscience and oncology and is designed to have clear competitive advantages. We test those assumptions throughout the development process. If a candidate doesn't meet these pre-specified criteria, we stop investing.

During Q1, Samsung issued a new treatment advisory for for prescribing pharmacotherapy for patients with alcohol use disorder encouraging providers to consider FDA approved medications when treating patients now.

And a part of our focus in 2021 is on driving awareness of <unk> as a treatment option for Apple dependents, among providers caregivers and patients.

Richard F. Pops: If we create value through new medicines, the way we can enhance that value and make it rewarding to shareholders is through an equivalent focus on structure, efficiencies, and profitability. The Value Enhancement Plan we introduced in December of last year furthers our focus on business excellence and makes explicit our intention to increase efficiency and profitability. It also provides a framework for allocating capital and prioritizing investments in our major cost areas of commercial and R&D and drives a clear focus on programs with the highest expected return on investment.

And as the country begins to emerge from the isolation of the pandemic public health organizations and experts have expressed increase and concern about the rise and heavy drinking and adverse alcohol related health conditions.

April is alcohol awareness month, and and we have been focused on launching campaigns designed to drive education around the disease of alcohol dependence and increase awareness of treatment options, including vivid trial and.

Now the prevalence of alcohol dependence and the indication mix for Vishal continues its upward trend driven by growth of the category and new patient starts.

Based on our results and the fourth quarter today, we are reiterating our expectation on visits while net sales and the range of $315 million to $345 million for 2021.

Richard F. Pops: The combination of scientific excellence and business excellence is a powerful concept that we've incorporated into all the aspects of the way that Alkermes operates. And it's what will drive our ability to grow value in the future. So now, with that as an introduction, I'll turn the call over to Iain to review the first quarter results. Thank you, Rich, and hello, everyone.

Turning now to the air standard product family net sales and the first quarter increased approximately 9% year over year to $55 $4 million driven.

Driven by strong Trs and months of therapy growth of 11% year over year that outpaced the broader long acting atypical antipsychotic market, which grew at 3%.

Iain Michael Brown: This morning, we announced solid financial results for the first quarter that derived from our two principal areas of focus: Driving Top Line Growth and Disciplined Expense Management. Based on these results and our expectations with respect to the ongoing recovery from the COVID-19 pandemic, today, we are reiterating our financial expectations for full year 2021, which were fully outlined in our press release in 8k filed back on February the 11th. For the first quarter of 2021, we generated total revenues of $251.4 million, driven by the solid performance of our proprietary commercial products and our diverse portfolio of manufacturing and royalty revenues, including notably the continued acceleration in the uptake of Umerity.

As anticipated net sales were down sequentially from the fourth quarter, driven by seasonal inventory fluctuations as he and outline inventory had retention and normal levels at the end of the first quarter.

As a result of the pandemic, we have seen some impact prescribing patterns and the long acting antipsychotic space.

Particularly to new prescriptions, and psychiatry healthcare providers made fewer treatment changes and the COVID-19 environment, particularly within the context of telehealth visits.

As a result, new to brand prescription growth flatten and the second half of 2020, we are encouraged and the first quarter of 2021, aerostat and <unk> growth was 11% on a sequential basis.

Iain Michael Brown: With operating expenses lower than the first quarter of 2020 across all line items, we achieved a gap net loss of $22.4 million and a non-gap net income of $17.8 million. Vivitrol net sales in the first quarter were $74.5 million. These results reflect a 6% decrease in units year-over-year due to continued pandemic-related disruptions in the treatment system. Despite this, Q1 net sales were ahead of our expectations for the quarter, driven by higher unit volume and some favorable gross-to-net adjustments related to Medicaid and lower product returns.

Hi, its and the LTI antipsychotic market further our market research shows that health care providers experienced steady or increasing patient volumes in the quarter.

Our recent market research also indicated that the value proposition of the aerostat, a two month dose plus aerostat initio continues to resonate with health care providers as evidenced by 21% year over year tier ex growth for the two month dose on a months of therapy basis.

Based on our Q1 results and these leading indicators, we are reiterating our expectation for aerostar and net sales within the range of $260 million to $290 million and 2021.

Iain Michael Brown: Gross Donets were 51.5% in the first quarter as compared to an average of 49.9% in 2020. And in Q1, inventory levels decreased by approximately $2.3 million to a more normalized level, as is consistent with typical seasonal.

Moving to <unk>, our oral investigational anti psychotic candidate designed to offer the efficacy of Olanzapine, while mitigating its associated weight gain is under review with the FDA with a <unk> date of June <unk>.

As we prepare for a potential commercial launch and the second half of 2021. Our team is focused on finalizing our payer strategy driving disease state awareness and engaging and scientific exchange.

Iain Michael Brown: Turning to the Aristarda product family, net sales in the first quarter increased 9% year over year to $55.4 million, primarily driven by underlying unit growth. As we anticipated on our year-end earnings call in February, Aristarda net sales declined sequentially due to a decrease in inventory levels in the first quarter. This inventory fluctuation represented approximately $8 million, and we ended Q1 at more normalized inventory levels. Growth to net adjustments of 53.3% in the first quarter were consistent with 2020. Now, while our restarted demand has been resilient throughout the pandemic, we have seen an impact on overall market growth, particularly related to new patient starts. And Todd will provide more detail on that shortly.

We believe <unk> if approved will represent an important new medicine for the treatment community.

Olanzapine is widely recognized as being highly efficacious, both physicians and patients often avoid prolonged utilization due to concerns about as propensity for weight gain.

Easter selling Lee Olanzapine was the fastest growing oral atypical and 2020 with a 15% increase and <unk> in December 2020, as compared to December 2019, suggesting that providers are increasingly seek and lands of teens antipsychotic efficacy for patients.

And the oral atypical antipsychotic market is highly dynamic with over 70000 treatments, which is occurring each month as patients look for the right medication to fit their needs.

Iain Michael Brown: Moving on to our Manufacturing & Royalty business, in the first quarter, our Manufacturing & Royalty revenues were $119.8 million, compared to $116.3 million in the prior year. This increase was driven primarily by the accelerated uptake of Umeriti, which contributed $13.4 million in the quarter, and growth of royalty revenues from Invegas, Astana, and Trinza, partially offset by lower year-over-year Risper Total operating expenses were $267.9 million for the first quarter, down from $283.6 million for the same period last year, reflecting our continued focus on disciplined expense management and our ongoing investment in programs we believe will drive long-term shareholder value.

We believe this reflects persistent unmet need and the market and a potential opportunity for a new entrant with a profile like <unk>.

If approved <unk> has the potential to serve two markets the treatment of adults with schizophrenia and the treatment of dose for the bipolar one disorder, while leveraging our existing psychiatry infrastructure lowball. The if approved will join aerostar and our psychiatry franchise.

Adding a product with a differentiated value proposition and suited for a different patient profile on.

And <unk> out of field force already calls and about 60% of Lowball These targeted provider universe and.

And we plan to add approximately 50 additional sales representatives and a staged fashion throughout the first year of launch based on payer access.

Looking ahead, we are focused on execution as we prepare for the potential launch of a lobby work to achieve our expectations for visitors and aerostar and continue to drive awareness of the value proposition of these important medicines now I will turn the call back over to rich.

Iain Michael Brown: R&D expenses for the first quarter were $92.3 million, compared to $93.3 million for the prior year, reflecting investment in Nemberlukin and the earlier stage HDAC and EREXIN platforms. SG&A expenses for the first quarter were $125.2 million, compared to $133.4 million for the prior year, primarily reflecting savings across the commercial organization.

Good Thank you Doug.

And so commercial and financial execution remain top priorities for the company.

But the value of the pipeline and our R&D investment is beginning to emerge and so I'm going to spend a few minutes on that the most prominent later stage elements are of course laboratory at the NDA stage, and our immuno oncology agent nimble Lucan.

Iain Michael Brown: Turning to our balance sheet, we ended the first quarter well capitalized with approximately $627 million in cash and total investments, and total debt outstanding was $298 million. We continue to focus our capital allocation on the highest return on investment opportunities that are consistent with our long-term growth strategy. Our priorities are clear: support our commercial portfolio to drive top-line growth, and invest in the potential launch of Lybaldi.

And we'll start with nimble Lucan as that program is advancing rapidly now.

<unk> is emerging as a differentiated late stage IL two variant and a field that is garnering more and more attention because of the promise of the biology number look and has moved well beyond the conceptual phase and is accumulating clinical results to support its potential therapeutic benefit and value proposition.

Differentiated in terms of its design and potential dosing flexibility antitumor activity, both as monotherapy and in combination and our clinical development strategy focused on patients for whom current therapies are inadequate or have failed.

Todd: Advance the Nambalukan Development Program and seek partnership opportunities; develop the newest pipeline programs emerging from our neuroscience and oncology platforms, as we unveiled at our recent Investor Day; and explore other strategic opportunities around non-core assets, including early-stage R&D programs and royalty streams. We believe that we enter the second quarter with a solid foundation for long-term value creation and are well positioned financially to execute on our strategy. And I look forward to updating you on our progress. And with that, I'll hand the call over to Todd to review our commercial results. Thanks, Iain.

We presented select data recently at our Investor Day, and we have another data presentation of coming into <unk>. So today I'm going to focus on important operational developments recently.

First we've achieved an important milestone on the program with the completion of enrollment in part B and C of artistry. One artistry. One is the primary signal seeking study for intravenous number Luca.

Where we begin to reveal for the first time that dosing tolerability and preliminary efficacy of this new molecule.

Todd: And good morning, everyone. I'm pleased with our commercial team's execution in the first quarter, with both Aristote and Vivitrol Q1 net sales slightly ahead of expectation. Our first quarter results reflect solid underlying unit demand and typical seasonal inventory fluctuation. Based on our Q1 results and current trends in the treatment landscape, we believe we are well positioned to achieve sales within our full-year guidance ranges for both Aristata and Vivitra. Now taking a step back, COVID-related disruptions continued to impact patient access to treatment for both addiction and serious mental illness in Q1, as we anticipated.

It was designed as a phase one two study with three parts part a was dose escalation designed to establish the pharmacokinetic and Pharmacodynamic profile of IV number look and evaluate safety and Tolerability and identify the recommended phase II dose.

Part B started after we identify the recommended phase II dose and was intended to confirm monotherapy activity and melanoma and renal cell carcinoma tumor types for recombinant human IL two has proven single agent efficacy.

From our from our perspective monotherapy antitumor activity as essential to validating the therapeutic potential and <unk>.

Todd: We continue to believe that patient access to care will improve as we approach the second half of 2021, as vaccinations continue to roll out across the country and capacity restrictions ease in settings of care. We have also seen encouraging trends in leading indicators, such as neutrobran prescriptions for both Vivitrol and Aristotile in the first quarter compared to Q4. We continue to execute on our hybrid promotional model that incorporates both in-person and virtual engagement.

We checked that box late last year, we've observed partial responses and both melanoma and RCC and data from that stage of the study continued to mature.

Part C was designed to see signals of antitumor activity in combination with the anti PD, one timber elysium and and both PD, one approved and PD. One unapproved tumor types. This has also been successful data from part C has revealed activity across a wide range of tumor types supporting the broad potential Utah.

Todd: This model was implemented in response to the COVID-19 pandemic last year, and it has allowed us to quickly adapt in this highly dynamic market environment. While virtual engagements have been critical to maintaining continuity, we look forward to increasing in-person engagement. We have seen these engagements pick up through the first quarter, with our sales force expanding the percentage of their in-person calls to approximately 50% in March, up from 40% in early January.

<unk> and nimble Luke and combination with Pembroke.

While the part C data set is still maturing we have observed a clear signal on durable and deepening responses and platinum resistant ovarian cancer and I'll talk more about our plans and that area and just a moment.

Artistry, one and will continue to provide a stream of data throughout the remainder of the year. The next data update will occur and <unk>, where the artistry. One dataset was accepted for a poster presentation also accepted and <unk> was a poster on artistry, two which is our phase one two study evaluating subcutaneous dosing and nimble Luca sub Q dosing.

Todd: Now, starting with Vivitrol, net sales in the first quarter were $74.5 million, consistent with seasonal patterns. However, Vivitrol net sales declined sequentially due primarily to the drawdown of Q4 inventory build as well as slightly higher gross net adjustments, as Iain outlined.

Could open up a broad range of clinical opportunities and to our knowledge number look and is the only IL two very and with a sub Q administration option currently and clinical development.

Todd: COVID-19 disruptions to the addiction treatment systems continue to negatively impact Vivitrol and Q1, and we are still working back up towards pre-pandemic unit demand levels. Pandemic-related restrictions broadly impacted patients' ability to access the health care system for treatment and impacted utilization of Vivitrol in particular due to the requirement for injections, the need to be opioid-free before receiving treatment, which often requires detoxification in a medical setting, and the nature of substance abuse treatment settings of care generally.

As for our history to it is also progressing well at the end of last year, we identified the recommended phase II dose of three Migs once weekly and initiated the debt.

Dose expansion phase.

And <unk> will present safety Tolerability, PK and PD data from those dose escalation cohorts. We presented the first partial response from that study and a patient with platinum resistant ovarian cancer at our recent Investor day, and we'll look forward to sharing additional data from the study as it matures.

Showing subcutaneous antitumor activity is an important milestone and the program and we're focused on further developing that dataset as we advance toward broader opportunities for strategic collaboration.

Todd: Now, we have seen stabilization within opioid dependence since the pandemic began, but we continue to see restrictions and settings of care that have yet to fully increase their patient capacity, most notably residential treatment centers, correctional facilities, and other government treatment locations. However, in our recent marker research, about 50% of healthcare providers that we surveyed reported a slight to substantial increase in AUD and OUD patient volume in March compared to the prior month, and Alcohol Dependents.

The positive signals that we've seen of antitumor activity and artistry, one and two triggered are advancing the development program to the next stage.

We're focused and our next efficacy studies on monotherapy and mucosal melanoma and combination therapy with Pembroke and platinum resistant ovarian cancer.

So, let's take those and turn mucosal melanoma is a rare and particularly aggressive form of melanoma with limited treatment options and artistry, one and we've seen and initial signals of antitumor activity for nimble look and as monotherapy in patients with this severe disease.

Todd: We have seen a resumption of growth in the market. Additionally, during Q1, SAMHSA issued a new treatment advisory for prescribing pharmacotherapies for patients with alcohol use disorder, encouraging providers to consider FDA-approved medications when treating patients. Now, part of our focus in 2021 is on driving awareness of Vivitrol as a treatment option for alkyl dependence among providers, caregivers, and patients. As the country begins to emerge from the isolation of the pandemic, public health organizations and experts have expressed increasing concern about the rise in heavy drinking and adverse alcohol-related health conditions.

Last month number liquids granted orphan drug designation in this indication and.

And we also recently met with FDA to align on a clinical study design and initiated what we call artistry. Six this single arm phase II study will evaluate IV number Luca monotherapy and checkpoint inhibitor experienced patients can be close on melanoma.

The study is designed to support potential registration on.

Obviously, depending on its results, including the magnitude and durability of responses and the observed safety profile.

Todd: April is Alcohol Awareness Month, and we have been focused on launching campaigns designed to drive education around the disease of alcohol dependence and increase awareness of treatment options, including Vivitrol. Now, the prevalence of alcohol dependence in the indication mix for Vivitrol continues to rise, driven by growth in the category and new patient starts. Based on our results in the fourth quarter, today we are reiterating our expectation of Vivitrol net sales in the range of $315 to $345 million for 2021.

And to leverage the crop the trial infrastructure being put in place for artistry. Six. This study will also enroll a cohort of patients with advanced cutaneous melanoma, who will receive sub Q administers nimble lucan.

This cohort is intended to establish proof of concept of antitumor activity with sub Q nimble look and as monotherapy and we anticipate dosing the first patient and <unk> six and the coming weeks.

The second focus area is platinum resistant ovarian cancer and known by the acronym product.

Todd: Net sales in the first quarter increased approximately 9% year-over-year to $55.4 million. However, as anticipated, net sales were down sequentially from the fourth quarter driven by seasonal inventory fluctuations. As Iain outlined, inventory had returned to normal levels at the end of the first quarter. However, as a result of the pandemic, we have seen some impact on prescribing patterns in the long-acting antipsychotic space. Particularly to new prescriptions as psychiatric health care providers made fewer treatment changes in the COVID environment, particularly within the context of telehealth business. As a result, new-to-brand prescription growth flattened in the second half of 2020.

We observe a clear signal of antitumor activity and artistry, one last year with a combination and nimble Luca and Pembroke and profit patients and we plan to initiate a phase III study and the second half of this year.

This is an indication where <unk> is not approved and is shown only very limited activity.

To support that study, we recently entered into a clinical supply and trial collaboration with Merck, We're still finalizing the study design with Merck and FDA, but we've agreed that the primary analysis will be nimble Luca and combination with Pembroke compared to investigator's choice of chemotherapy.

We're pleased to be partnering with Merck on this study and we believe that their participation is an important validation of the signals that we've observed importantly, the collaboration does not impede our ability to or intention to pursue broader strategic collaboration for the nimble Lucan program, which remains an important strategic priority for the company.

Todd: We are encouraged that in the first quarter of 2021, Aristotle MBRX growth was 11% on a sequential basis, the highest in the LAI antipsychotic market. Furthermore, our market research shows that healthcare providers experience steady or increasing patient volumes in the quarter. Recent market research also indicated that the value proposition of the Aristata two-month dose plus Aristata Initio continues to resonate with healthcare providers, as evidenced by 21% year-over-year TRX growth for the two-month dose on a month-of-therapy basis. Based on our Q1 results and these leading indicators, we are reiterating our expectation for Aristotle net sales within the range of 260 to $290 million in 2021.

There are excuse me there are a number of IL two variant programs and development.

This is because of the compelling logic of the proven IL two pathway as a complement to a range of tumor killing approaches the various hypotheses underlying these programs, we will need to be confirmed through the process of developing human clinical data relating to response and duration and various tumor types. This is the path, we followed with <unk>.

And to Luca and the accumulating human clinical data relating to response and duration and various tumor types and the artistry program is the reason why the program is accelerating.

And the acknowledgment of investigators and thought leaders and the clinical trial momentum are important validation for the program and.

Todd: Moving to Libavi, our oral, investigational anti-psychotic candidate designed to offer the efficacy of lantopine while mitigating its associated weight gain is under review with the FDA with a PDUFA date of June 1st. As we prepare for a potential commercial launch in the second half of 2021, our team is focused on finalizing our payer strategy, driving disease state awareness, and engaging in scientific exchange. We believe LABAVI, if approved, will represent an important new medicine for the treatment community. Lansmine is widely recognized as being highly efficacious, but physicians and patients often avoid prolonged utilization due to concerns about its propensity for weight gain.

And we look forward to sharing incremental updates throughout the year.

I will finish with a brief update on <unk>. Currently we are working with FDA toward our June <unk> day in parallel to our review.

The prelaunch activities are advancing and we're laying the foundation for commercial have a commercial launch in the second half.

Across the business the priorities are clear and we're intensely focused on execution, we've taken great care to re envision alkermes approach to new drug development and establish a strong complementary focus on efficiency and driving value. While some of these efforts will bear out over time, we believe we have significant opportunity to drive real value and <unk>.

<unk> thousand 21, so with that I'll turn the call back to Sandy to run the Q&A. Thank you Richard and I will.

Todd: Interestingly, olanzapine was the fastest-growing oral atypical in 2020, with a 15% increase in embryo access in December 2020 as compared to December 2019, suggesting that providers are increasingly seeking olanzapine's antipsychotic efficacy for patients. The oral atypical antipsychotic market is highly dynamic, with over 70,000 treatment switches occurring each month as patients look for the right medication to fit their needs. We believe this reflects persistent unmet needs in the market and a potential opportunity for a new entrant with a profile like Lebovitz. If approved, Lavalvie has the potential to serve two markets. The Treatment of Adults with Schizophrenia and The Treatment of Adults with Bipolar 1 Disorder

And now open the call for Q&A. Please.

Thank you.

And that will be conducting a question and answer session.

And the interest of time until I have as many as possible ask questions. Please limit yourself to one primary question and one follow up question.

You'd like to ask a question at this time. Please press star one from your telephone keypad and a confirmation tone will indicate your line is and the question queue can.

You May press star two if he would like to remove your question from the queue.

For participants using speaker equipment and may be necessary to pick up for handset before pressing the star keys on.

One moment, please while we poll for questions.

Thank you. Our first question today comes from the line of Brandon Folkes with Cantor Fitzgerald. Please proceed with your question.

Hi, Thanks for taking my question and congratulations on all day updates year to date.

Richard F. Pops: While leveraging our existing psychiatry infrastructure, LeBalvy, if approved, will join Aristotle in our psychiatry franchise, adding a product with a differentiated value proposition and suited for a different patient profile. Our Aristotle Field Force already calls in about 60% of LaValvie's targeted provider universe, and we plan to add approximately 50 additional sales representatives in a staged fashion throughout the first year of launch based on payer access. Looking ahead, we are focused on execution as we prepare for the potential launch of the lobby, work to achieve our expectations for Vivitrol and Aristata, and continue to drive awareness of the value proposition of these important measures. Now, I'll turn the call back over to Rich.

And I just want to actually focus on our start in vitro.

Talked about the COVID-19 restrictions and sort of the headwind.

And you'd have been going on for a long time.

And as we kind of opened up how much do you think had there's been a bit of a permanent change and treatment paradigms and.

The addiction space as well as <unk>.

Typical long acting injectable market, how should we think about sort of this ramp back to pre COVID-19 levels is this something that's going to take a lot of work from the commercial side.

Just any color there would be great in terms of sort of the ramp we should expect back to pre COVID-19 levels. Thank you very much.

Yes, absolutely and and.

Thank you we are very pleased with the commercial performance for both products and Q1.

Richard F. Pops: Good, thank you, Todd. So, commercial and financial execution remain top priorities for the company, but the value of the pipeline and our R&D investment is beginning to emerge. So I'm going to spend a few minutes on that.

We do assume and normalization of patient volumes and the second half of the year.

Which also includes moderate market growth.

Richard F. Pops: The most prominent later stage elements are, of course, Libalvi at the NDA stage, and our immuno-oncology agent, Nemvlu. I'm going to start with Nemba Lucan as that program is advancing rapidly now. Pneumelucan is emerging as a differentiated late-stage IL-2 variant.

And which really is going to be driven by improved patient access to treatment providers all of our qualitative research supports that one of the key metrics that we continue to watch as telemedicine and utilization and I think the interesting fact from our survey physicians showed that.

Richard F. Pops: In a field that's garnering more and more attention because of the promise of the biology, nemvalucan has moved well beyond the conceptual phase and is accumulating clinical results to support its potential therapeutic benefit and value proposition. Differentiated in terms of its design, potential dosing flexibility, anti-tumor activity, both as monotherapy and in combination, and our clinical development strategy focused on patients for whom current therapies are inadequate or have failed. We presented SELECTdata recently at our Investor Day, and we have another data presentation upcoming at ASCO.

Right when the pandemic happened you saw a huge percentage of hcp's and both therapeutic areas switch to telemedicine and we're starting to see a gradual shift back to and person engagements and access to treatment providers opening up.

So we are expecting that to normalize and the second half of the year.

And when that normalizes, we believe that will start to see and increase and the switching market.

And that really drives both of these products that drives <unk>, but it also drives the addiction treatment landscape for for the trial as well too. So that's how we're thinking about it as more of a normalization and the second half of the year.

Richard F. Pops: So today I'm going to focus on important operational developments in recent weeks. First, we achieved an important milestone in the program with the completion of enrollment in Parts B and C of Artistry I, the primary signal-seeking study for intravenous nemboluco, where we began to reveal for the first time the dosing, tolerability, and preliminary efficacy of this new molecule. It was designed as a Phase I-II study with three parts.

Alright, Thank you very much.

The next question comes from the line of female and <unk> with Mizuho Securities. Please proceed with your questions.

Alright, thanks, so much for taking the questions.

So two if I could one on <unk>. It sounds like you are and it sounds to be on track for US This June and first data.

My question that we've been getting to it for investors.

Richard F. Pops: Part A was a dose escalation designed to establish the pharmacokinetic and pharmacodynamic profile of IV nemvolucan, evaluate safety and tolerability, and identify the recommended Phase II dose. Part B started after we identified the recommended phase 2 dose and was intended to confirm monotherapy activity in melanoma and renal cell carcinoma. Tumor types for recombinant human IL-2 have proven single agent efficacy. From our perspective, monotherapy anti-tumor activity is essential to validating the therapeutic potential of nemphalosis. We checked that box late last year.

And for your prior budget per day in November it sounded like you already finished all the labeling discussions and then the manufacturing questions that came up at the and so.

Just curious if that's the right way to interpret things and is there and did anything around restrictions to and which patients could potentially get the product or any sort of risk mitigation strategies any of those kind of things and what those already be sort of well known to you at this point or is that still sort of being discussed with the FDA and then the second question I have is on day Mary.

Richard F. Pops: We've observed partial responses in both melanoma and RCC, and data from that stage of the study continue to mature. Part C was designed to seek signals of anti-tumor activity in combination with the anti-PD-1 tembrolizumab in both PD-1 approved and PD-1 unapproved tumor types. This has also been successful.

And just given the sort of pretty dramatic change we've seen a prescription trends there and then you've talked about royalty streams and potentially being one of the things you look at it as part of your value enhancement plan and I'm. Just curious how you think about a product like that thats still pretty early.

Cycle, maybe a little tough to kind of pick on exactly what the long term value is.

Is that something you could.

Monetize and.

Near term and user need to wait for.

A little while before you can really see what the value is for that product, especially given some of the outstanding questions on the tech for their patent and as well so any comments there would be helpful. Thank you.

Richard F. Pops: Data from Part C has revealed activity across a wide range of tumor types, supporting the broad potential utility of nemphalucan in combination with Pembroke. While the Part C dataset is still maturing, we've observed a clear signal of durable and deepening responses in platinum-resistant ovarian cancer, and I'll talk more about our plans in that area in just a moment. Artistry 1 will continue to provide a stream of data throughout the remainder of the year.

Good morning, and onwards, rich I'll start and and if he and has some color.

And you'll just.

Chime in.

Labelle day, we seem to be on track for the six one for the six one date youre right in a previous iteration, we had had some label discussions and.

And then the manufacturing stuff came on at the last minute.

We've continued at label discussions with the FDA now and this in this cycle and which is why we think we're on track.

Richard F. Pops: The next data update will occur in the afternoon, where the Artistry 1 dataset was accepted for a poster presentation. Also accepted at ASCO was a poster on Artistry 2, which is our Phase 1-2 study evaluating subcutaneous dosing of nembolutum. Sub-Q dosing could open up a broad range of clinical opportunities, and to our knowledge, Numbulucan is the only IL-2 variant with a sub-Q administration option currently in clinical development. As for Artistry 2, it's also progressing well.

But labeling negotiations are never over until they're over but so far there has not been anything that has been unexpected and those discussions.

So we're optimistic that we can get this finished off.

These days with FDA I think caution is always it's always important to us, but we have no indication of and so far.

Richard F. Pops: At the end of last year, we identified the recommended phase 2 dose of 3 mg once weekly and initiated the dose expansion phase, at ASCO, we will present safety, tolerability, PK, and PD data from those dose escalation cohorts. We presented the first partial response from that study in a patient with platinum-resistant ovarian cancer at our recent Investor Day, and we'll look forward to sharing additional data from the study as it matures Showing subcutaneous anti-tumor activity is an important milestone in the program, and we're focused on further developing that data set as we advance toward broader opportunities for strategic collaboration.

Yeah, I think you answered the question yourself on Humira and Humira is really beginning.

Non linear part of its growth phase so it's very difficult to project what the actual shape of the curve will be that would be the basis of a monetization at this moment with that said and it's something that we're interested in and we'll pay attention to.

And any other further color and nobody and drive that obviously I think we're just very encouraged with the revenue trends that we've seen and <unk> and the fourth quarter on that into the first quarter I think as rich says it looks like it's on a new trajectory, we do manufacture the product. So we get a little bit more of an insight into what's happening into the future on those manufacturing trends and the order pattern a very.

Richard F. Pops: The positive signals that we've seen of anti-tumor activity in artistry 1 and 2 triggered our advancing the development program to the next stage. We're focusing our next efficacy studies on monotherapy in mucosal melanoma and combination therapy with PEMBRO in platinum-resistant ovarian cancer. So let's take those in turn.

<unk> as well.

But as rich said, it's early and in order for us to establish value I think we need to see a few more consecutive strong quarters for them.

For <unk>.

Okay. Thank you.

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

Richard F. Pops: Mucosal melanoma is a rare and particularly aggressive form of melanoma with limited treatment options. In ART3-1, we've seen the initial signal of anti-tumor activity for nembolucanism monotherapy in patients with this severe disease. Last month, NEMVLUQ was granted orphan drug designation in the syndication, and we also recently met with FDA to align on a clinical study design and initiated what we call Artistry 6. This single-arm phase 2 study will evaluate IV nemvalucan monotherapy in checkpoint inhibitor experienced patients with mucosal melanoma, and the study is designed to support potential registration. Obviously, this will depend on its results, including the magnitude and durability of responses and the observed safety profile.

Hi, this is for on for Paul. Thanks, So much for taking the question one.

One question on <unk>, and then one on <unk> and <unk>, how much growth and alcohol dependence and assumed in your guidance and then.

On nimble look and what does the path look like for artist through six two registration.

Thanks, so much.

Yes, I'll start off with.

With the question on alcohol, we continue to make really good progress on our strategy to maximize the opportunity for alcohol, it's a significant unmet need and the marketplace.

Last year, we saw about a 4% growth year over year, we're expecting that to continue so similar to be linear and and we expect to continue to gain market share within the category. So we're expecting overall on our months of therapy basis. Overall, we think that that growth and some we're going to be within.

Richard F. Pops: To leverage the trial infrastructure being put in place for Artistry 6, the study will also enroll a cohort of patients with advanced cutaneous melanoma who will receive sub-Q in Ministers Nympha Luca. This cohort is intended to establish proof of concept of anti-tumor activity with sub-Q nemavolucan as monotherapy. We anticipate dosing the first patient in RS3-6 in the coming weeks. The second focus area is platinum-resistant ovarian cancer, known by the acronym PROC. We observed a clear signal of anti-tumor activity in artistry 1 last year, with a combination of nemvalucan and PEMBRO in PROC patients, and we plan to initiate a phase 3 study in the second half of this year. This is an indication where PEMBRO is not approved and has shown only very limited activity.

Net.

And probably close to 2% to 4% is the range that we're looking at.

And this is Richard I'll answer the question on <unk> hundred six.

We closed on melanoma is or is it.

And the disease with serious unmet needs and the patients that we're looking at are people who have progressed beyond.

<unk> inhibitors, so they have very limited treatment options.

The clinical profile that is so exciting about and IL two variant like nimble Luke and is a combination of three things. One is overall response rate and number two is durability of those responses and number three is tolerability. So that will be the profile will be looking at <unk> hundred six evolves.

Richard F. Pops: To support that study, we recently entered into a clinical supply and trial collaboration with Merck. We're still finalizing study design with Merck and FDA, but we've agreed that the primary analysis will be Nemvalucan in combination with Pembro compared to investigator choice of chemotherapy. We're pleased to be partnering with Merck on this study, and we believe that their participation is an important validation of the signal that we've observed. Importantly, the collaboration does not impede our ability to, or intention, to pursue broader strategic collaboration for the Nimba-Lutkin program, which remains an important strategic priority for us. There are a number of IL-2 variant programs in development. This is because of the compelling logic of the proven IL-2 pathway as a complement to a range of tumor killing approaches.

Great. Thanks, so much.

Our next question is coming from the line of Cory <unk> with Jpmorgan. Please proceed with your questions.

Hey, good morning, guys. Thanks for taking the questions two for me both on <unk> and first one is following up on artistry six.

Can you talk about the rationale for evaluating both the IV and sub Q formulation. There I mean, I know you've talked about sub Q ultimately being more of a contingent factor for future partnerships. Also if you can talk a little bit more about that strategy and then for the upcoming posters at <unk>, how much should we be expecting in terms of follow up for <unk>.

And for artistry, two and for the abstracts themselves are those going to be essentially placeholders relative to what you've disclosed already or should we be expecting meaningful updates there. Thank you.

Richard F. Pops: The various hypotheses underlying these programs will need to be confirmed through the process of developing human clinical data relating to response and duration in various tumor types. This is the path we followed within the loop, and Accumulating Human Clinical Data Relating to Response and Duration in Various Tumor Types in the Artistry Program is the reason why the program is accelerating. The acknowledgment of investigators and thought leaders and the clinical trial momentum are important validations of the program, and we look forward to sharing incremental updates throughout the year.

More and inquiry reduce your voice I I'll take the first part and attendees more expert on the second part.

And throughout the throughout the program for nimble look and we think of the IV.

And as the leading edge of the wedge followed then by the sub Q with a hope and expectation that sub Q could recapitulate, essentially the activity and the and.

And the efficacy that we see with IV and Thats exactly what were doing in and artistry six and while we have great investigator thought leader interest in treatment for patients with with mucosal melanoma at that stage, there's really very little for them. So moving ahead with the IV could be life sparing life saving and <unk>.

Richard F. Pops: I'll finish with a brief update on Lebalvi. Currently, we're working with FDA toward our June 1st PDUFA date. In parallel to our review, the pre-launch activities are advancing, and we're laying the foundation for commercial launch in the second half. Across the business, the priorities are clear, and we're intensely focused on execution. We've taken great care to re-envision Alkermes' approach to new drug development and establish a strong complementary focus on efficiency and driving value.

Life changing therapy for these patients, but introducing the sub Q and to that clinical setting as well would give us the option if we see that type of efficacy as well.

Advancing the sub Q dose within the context of the same protocol. So when we're putting in this clinical network do mucosal melanoma around around various countries and various sites. It's a great. It's a great assets to leverage to feather in the sub Q piece as well and we'll see how those seats on those.

Sandra Coombs: While some of these efforts will bear out over time, we believe we have a significant opportunity to drive real value in 2021. So with that, I'll turn the call back to Sandy to run the Q&A. Thank you, Richard. We'll now open the call for Q&A, please. Thank you. Well, that would be conducting a question and answer session. In the interest of time, until I have as many as possible to ask questions, please limit yourself to one primary question and one follow-up question.

Acute data.

Evolve.

And part of your question on the on ESCO.

Posters and recall that we did just give an update on the number Luke and program at our Investor day, So we'll refresh that data.

Sandra Coombs: If you would like to ask a question at this time, please press star 1 on your telephone keypad, and a confirmation tone will indicate your line is in the question queue. You may press star 2 if you would like to remove your question from the queue. For participants using speaker equipment, it may be necessary to pick up your handset before pressing the star key. One moment, please, while we poll for questions. Thank you. Our first question today comes from the line of Brandon Folkes with Cantor Fitzgerald.

But there'll be on.

And it.

And probably a month's worth of additional.

Follow up data in that and that poster, but as that dataset evolve and we'll try to keep investors updated as possible.

Okay perfect. Thank you guys.

Thank you.

Our next question is from the line of Jeet Mukherjee with Jefferies. Please proceed with your questions.

Brandon Richard Folkes: Hi, thanks for taking my question and congratulations on all the updates year-to-date. So, I just want to actually focus on Aristotle and Vivitrol.

Hey, good morning, guys. Thanks for taking my question two for me back to artist Street, six perhaps just wanted to get a sense of perhaps how many cutaneous melanoma patients you plan to enroll and what do you believe are perhaps the respective bars for efficacy to meet and mucosal and cutaneous melanoma and.

unknown: You talked about the COVID restrictions and sort of the headwind, and, you know, these have been going on for a long time. So, as we kind of open up, how much do you think there's been a bit of a permanent change in treatment paradigms in the addiction space as well as the atypical long-acting injectable market? How should we think about sort of this ramp back to pre-COVID levels? Is this something that's going to take a lot of work from the commercial side? Just any color there would be great in terms of the sort of ramp we should expect back to pre-COVID levels.

And the second question was asked for Investor Day, you had highlighted perhaps several steps to facilitate that expense management could you perhaps elaborate on what stuff will continue to be implemented throughout the year and hopefully be reflected on the bottom line. Thanks.

Sure Keith This is Danny I'll take the question on the patient enrollment numbers, so overall and artistry six we expect to enroll approximately 110 patients.

unknown: Thank you very much. Yeah, absolutely. And, and thank you.

unknown: We are very pleased with the commercial performance for both products in Q1. We do assume a normalization of patient volumes in the second half of the year, which also includes moderate market growth, which is really going to be driven by improved patient access to treatment providers. All of our qualitative research supports that. One of the key metrics that we continue to watch is telemedicine utilization. And I think the interesting fact from our survey physicians is that, you know, right when the pandemic happened, you saw a huge percentage of healthcare professionals in both therapeutic areas switch to telemedicine. And we're starting to see a gradual shift back to in-person engagements and access to treatment providers opening up. So we are expecting that to normalize in the second half of the year.

Of that approximately 40 will be and the cutaneous melanoma.

Melanoma arm using the sub Q and 70 will be and the mucosal iron rich.

Richard do you want to comment on the.

And the response.

Yes, I think that I think that R. R.

Our bio statistical approach to this is and we wanted to see response rates and the.

20% level, but it's also with the.

Additional feature that I mentioned before of durability I think durability is really important it's striking.

First response, we had a partial response and we've talked about previously that patient has been on therapy for I believe over a year now.

And that's that's really encouraging aspect of it.

Nimble Luke and in this setting.

And you want to comment on the expenses and then on the expense management side, Yes, I mean, we're really looking across the business and everything both internally and we also brought in ex.

External consulting organization at the beginning of the year. So a number of initiatives came out of that some of which we factored into our 2021 guidance, but as we go forward that the focus is going to continue and actively managing on the head count side of things as people leave the organization, we're just making sure that we have the right Reese.

Emile Devon: The next question comes from the line of Emile Devon with Mizzou Host Securities. Please answer.

<unk> focused on the right programs on a program basis, both within commercial and within R&D and we're ensuring that we're really focusing that investment on the opportunities that are going to maximize return on investment and we're looking at other opportunities as well like with examples on real estate footprints as well, so it's a pretty thorough process and with <unk>.

Richard F. Pops: Great, thanks so much for taking the questions. So two, if I could, so one on my body. It sounds like you're being sound to be on track towards this June 1 date. I guess my question that we've been getting to from investors: Before your prior Pudupodate in November, it sounded like you had already finished all the labeling discussions, and then the manufacturing questions sort of came up at the end, so I'm just curious if that's the right way to interpret things, and is there anything around restrictions on which patients should potentially get the product, or any sort of risk mitigation strategies, any of those kind of things?

Very focused on ex in order to be able to achieve the longer term profitability targets that we've laid out and the value and huntsman plan.

Great. Thank you so much.

Thank you. Our next question is coming from the line of Marc Goodman with SBB Leerink. Please proceed with your question.

Richard F. Pops: Would those already be sort of well-known to you at this point, or is that still sort of being discussed with the FDA? And then the second question I have is on femerity, and just given the sort of pretty dramatic change we've seen in prescription trends there, I think you've talked about royalty streams potentially being one of the things you look at as part of your value enhancement plan, and I'm just curious how you think about a product like that that's still pretty early in its life cycle, maybe a little tough to kind of figure out exactly what the long-term value is.

Yeah, just a continuation there.

On the value enhancement play and we've talked about.

<unk> and non core assets I'm, just kind of curious what your thoughts on it back there and.

Additionally on.

On the oncology area you were talking about.

Partnering but just curious where you are still thinking about.

Maturing this day to throughout the year before you start those types of discussions or certainly signing anything and just kind of curious how your thought process there.

Richard F. Pops: Is that something you could sort of monetize in the near term, or do you need to wait for, you know, a little while before you can really see what the value is for that product? Because you've given some of the outstanding questions around the tech, but there are patents as well, so any comments there would be helpful.

And maybe you could just lay out and secondly, just completely separate topic just on spending.

Obviously very late in the quarter, just give us a sense of how the spending goes throughout the year just on the SG&A line. Thanks.

Richard F. Pops: Thank you. Good morning, I'm What's Rich. I'll start and then, if Iain has some color, he can... Chime in. At Libaldi, we seem to be on track for the 6-1 date. You're right. In our previous iteration, we had some label discussions. We've continued our label discussions with FDA now in this cycle, which is why we think we're we're on track uh... but label negotiations are never over until they're over, but so far, there's nothing anything that would stop that, So we're optimistic that we can get this finished off. But these days with the FDA, I think caution is always warranted.

If I kick off on that thing with the monetization of the non core assets.

We've identified a number of areas that we're not continuing to focus on necessarily internally and we've.

And we've talked about some of the non core R&D programs and earlier stage R&D programs and with regard to the royalty monetization and we sort of covered that a little bit earlier with regard to it's really a value proposition, we want to make sure that and we get sufficient value I think numerically for us is almost valuable royalty stream at this point and time.

And we just wanted to see that maturity of this new trajectory and order for us to be able to establish value that.

From a spending perspective I think we were very pleased with where Q1 came in and expenses across the board were lower than both Q1 of last year and Q4 of last year and I think as we look out through the remainder of the year.

Iain Michael Brown: But we have no indication of it so far. I think you answered the question yourself about bumeridae. Bumeridae is really beginning a sort of non-linear part of its growth phase, so it's very difficult to project what the actual shape of the curve will be that would be the base.

And then from a cost of goods perspective.

We anticipate that would increase with increasing volume specifically of our proprietary products on the R&D side.

And I think expenses will tick up a little bit as the number look and program continues and we saw launch into office three six and then and then the profit program.

Paul Andrew Matteis: [inaudible] Iain, any other further comment on that? Iain Brown Not much to add there. Obviously, I think we're just very encouraged with the revenue trends that we've seen in the fourth quarter and then into the first quarter. I think, as Rich says, it looks like it's on a new trajectory. We do manufacture the products, so we get a little bit more of an insight into what's happening in the future, and those manufacturing trends and the order pattern are very encouraging as well. But, as Rich says, it's early, and in order for us to establish value, I think we need, Okay, thank you. Our next question is from the line of Paul Matteis.

And we also have a $25 million milestone and the second half of the year as well related to the kickoff of the HVAC.

11, 40 program and then specifically with regard to SG&A.

As Todd mentioned I think we will augment the sales force and there'll be some incremental spend that'll be on a staged basis, though which will be closer to the Purdue for timeline around June and then may be a little bit of incremental investments as we gain access for liability as well. So I think that's really the profile that we're looking at.

unknown: Hi, this is Thoron on behalf of Paul. Thanks so much for taking the question. One question on Vivitrol and then one on Nemvolucan. In Vivitrol, how much growth in alcohol dependence is assumed in your guidance? And then on Nemvolucan, what does the path look like?

All in all were very comfortable with the guidance, we went out within the February timeframe, and hence we reiterated that guidance today.

And Mark it's rich.

And I wanted to pick on on your question about the partnering because I think what's so interesting and the sale to space right. Now is how the various programs are segregating into their own liens and they are clearly non interchangeable and I think that number Luca and in particular is emerging as a really important interest in this field.

Richard F. Pops: Yeah, I'll start off with the question on alcohol. We continue to make really good progress in our strategy to maximize the opportunity for alcohol. It's a significant unmet need in the marketplace. Last year, we saw about 4% growth year-over-year. We're expecting that to continue, so it will be somewhat linear, and we expect to continue to gain market share within the category. So we're expecting, overall, on a month-of-therapy basis, overall, we think that that growth is somewhere going to be within that, you know, probably close to 2-4% is the range that we're looking at.

And the existence of monotherapy efficacy and the ability of the availability of the Souk sub Q dose are too highly differentiating features of it we really do want to elaborate that sub Q efficacy. It's just beginning to emerge now with the recommended phase II dose and artistry two being achieved at the end of last year we.

Just to open up the expansion cohort, we are fortunate that right on the threshold of Investor day, we saw with our first patient and our first response.

And in product, but we expected that sub Q profile will continue to elaborate and youll see it <unk>. Some of the actual pharmacodynamic features of the sub Q presentation that are slightly different and the IV that we're encouraged by so I've said before we really don't want to spend any time and our partnering discussions and trying to do.

Richard F. Pops: And this is Rich Allinister and the question for the Artistry 6, mucosal melanoma is a serious unmet need, and the patients that we're looking at are people who've progressed beyond checkpoint inhibitors. So they have very limited treatment options.

Adjudicate, whether or not and sub Q dose works, whether or not the drug is efficacious, we can do that all on our own when we move into the partnering discussions it's about how and what what indications should we go after how do we expand this program how do we create the most medical and economic value for nimble, Duke and so I think that data set will continue to mature this year.

Sandra Coombs: I think the clinical profile that is so exciting about an IL2 variant like Nambalukin is a combination of three things. One is overall response rate. Number two is durability of those responses, and number three is tolerability. So that will be the profile we'll be looking at as R3-6 evolves.

But I think it's we can hear the drum beat and the distance now.

Corey Kazimoff: Thanks so much.

Thanks.

Richard F. Pops: Our next question is coming from the line of Corey Kazimoff with J.P. Morgan. Hey, good morning, guys. Thanks for taking the questions. Two for me, both on NemVolucan.

And next question's from the line of our cash to worry with Wolfe Research. Please proceed with your line.

Hi, This is Amy on for our cash thanks, so much for taking our question.

Richard F. Pops: The first one's following up on Artistry 6. Can you talk about the rationale for evaluating both EIV and sub-Q formulations there? I mean, I know you've talked about sub-Q ultimately being more of a contingent factor for future partnerships. So could you talk a little bit more about that strategy? And then for the upcoming posters at ASCO, how much should we be expecting in terms of follow-up for Artistry 2? And for the abstracts themselves, are those going to be essentially placeholders relative to what you've disclosed already, or should we be expecting meaningful updates there? Thank you. Good morning, Corey.

And that's part of a couple on your Orexin program.

And you think about the design of your little Carnival, and the competitive with both what specific properties and optimizing for <unk>.

Top line blood brain barrier penetration or selectivity and just looking at your early data and <unk>.

It looks like Youre reading for no more.

Rob and Todd a quick and.

Benefit on wakefulness, and at lower doses compared to potatoes, and although well acknowledge it's early data, but I just wanted to kind of think about how you're looking at the design and your molecule and.

Richard F. Pops: I'm going to use your voice. I'll take the first part because Kandi's more expert at the second part. Throughout the program for Nimbulukin, we think of the IV as the leading edge of the wedge, followed then by the subcube, with the hope and expectation that the subcube could recapitulate, essentially, the activity and the efficacy that we see with the IV, and that's exactly what we're doing in Artistry 6. While we have great investigator, thought leader, interest in a treatment for patients with mucosal melanoma at that stage, there's really very little for them.

And then another one in terms of the blood pressure increases and Pollakiuria indicators Orexin trial do you think this is an on target Lx two are related to factor and off target, Alex what I related effects.

And any color you can add here would be super helpful. Thanks.

While this sounds like you are ready for a conversation with some of the folks on the research team.

And I'll give you and I'll give you.

Our perspective on this.

Things like like PK profile peak to trough partition coefficient halfway I E.

Richard F. Pops: So moving ahead with the IV could be, you know, life-saving, life-changing therapy for these patients. But introducing the sub-Q into that clinical setting as well would give us the option, if we see that type of efficacy as well, of advancing the sub-Q dose within the context of the same protocol. So when we're putting in this clinical network to do mucosa melanoma around various countries and various sites, it's a great asset to leverage to feather in the subcut piece as well. And we'll see how those subcut data evolve. And Corey, your question on the

These technical aspects are all part of the design, but the translate actually.

Into something that the way we view it as from the patient perspective, which is what we're looking for is a once daily well tolerated low.

And the side effect profile agent.

To address the clinical condition and we see.

White space compared to what other companies are doing and it also leverages our something that we've spent a lot of time focused on over many years, which is that the relationship between from a kinetics pharmacodynamics blood brain penetration.

unknown: Transcription by CastingWords Transcript by Rev.com Page of posters.

And attrition CNS exposure versus peripheral exposure and mitigating or extend or accentuating pharmacodynamic effects of various molecules based on the way for them a presentation to the periphery of the brain.

unknown: Posters recall that we did just give an update on the Numbulukan program at our investor day. So we'll refresh that data, but there'll be Okay, perfect.

So I won't bore everybody with all the specifics of the questions that you asked and I will recommend that we have a follow up conversation with you because theres a theres a lot of science here, there's a lot of data and we're happy to talk about it.

Jeet Mukherjee: Thank you, guys. Our next question is from the line of Jeet Mukherjee with Jeffreys, please proceed with, Hey, good morning, guys. Thanks for taking my question. Two for me, back to Artistry 6, perhaps.

Thank you so much.

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

Sandra Coombs: Just wanted to get a sense of perhaps how many cutaneous melanoma patients you plan to enroll, and what do you believe are perhaps the respective bars for efficacy to meet in mucosal and cutaneous melanoma? And the second question was, at your investor day, you had highlighted perhaps several steps to facilitate that expense management. Could you perhaps elaborate on, you know, what steps will continue to be implemented throughout the year and hopefully be reflected in the bottom line? Thanks. Sure, Jeet. This is Sandy.

And you might be muted Doug.

Mr. <unk> Your line is open for questions.

And Mr. So please proceed.

And finally move on and you can see on the back it does king.

Reestablish his line for.

Sure. Our next question and will be coming from Jason <unk> of Bank of America.

Richard F. Pops: I'll take the question on patient enrollment numbers. So overall, in Artistry 6, we expect to enroll approximately 110 patients. Of that, approximately 40 will be in the cutaneous melanoma arm using the sub-Q, and 70 will be in the mucosal. Rich, do you want to comment on the Yeah, I think that our biostatistical approach to this is that we want to see response rates in the 20-plus percent level, but it's also with the... Additional feature that I mentioned before of durability.

Hi, everyone and this is chi on for Jason and Thanks for taking our question and two from US a first one on for Matt.

Alrighty.

Our partner Biogen declined to comment on the impact of Tech for Dow a Pat on Berlingske, possibly we moving generics of backdrop for them to market.

But I'm curious if you can comment on how pick up a path for that some of them for meritor and generic tepid Tara came off the market I guess a follow on on.

Nimble Duke and.

April to come for the cutoff on income from responses that you showed at Investor day or is it something and update that we can look for what you at ash. Thank you.

Richard F. Pops: I think durability is really important. It's striking that the first response we had was a partial response. We talked about earlier that patient has been on therapy for, I believe, over a year now, And that's really encouraging us.

I'll take the first one and maybe sandy can take the second one.

Look.

The experts on the interaction between primary and tech and our Biogen and you should really focus on from our perspective I can tell you.

Sandra Coombs: And then on the expense management side, yeah, I mean, we're really looking across the business at everything, both internally and we also brought in an external consulting organization at the beginning of the year. So a number of initiatives came out of that, some of which we factored into our 2021 guidance. But as we go forward, that focus is going to continue. And, you know, we're actively managing on the headcount side of things, as people leave the organization. We're just making sure that we have the right resources focused on the right programs.

<unk> was designed as a next generation and fumarate with benefits for patients and namely in the form of.

Preserving the proven efficacy of monomer for <unk> in a dosage form and a molecule that is more gi tolerance and.

And that's what we're seeing and the real world. So.

Our view is if you marry represents a generational advance for the benefit of patients and that's what should drive.

Increased utilization in the clinic.

Sandra Coombs: On a program basis, both within commercial and within R&D, we're ensuring that we're really focusing that investment on the opportunities that are going to maximize return on investment. And we're looking at other opportunities as well, like, for example, our real estate footprints as well. So it's a pretty thorough process, and we're very focused on it in order to be able to achieve the longer-term profitability targets that we've laid out in the value enhancement plan. Great, thank you so much.

On the number look inside and Sandra you want to answer that one.

And on the nimble look inside sorry repeat your question Chi.

Oh, yes, the cutoff.

And so it's like you're able to come from them.

And we won't comment on that on this call you can look forward to ask for an update on on any additional confirmation.

Awesome. Thanks, so much.

Thank you.

Our next question is from the line of Terence Flynn with Goldman Sachs. Please proceed with your question.

Marc Harold Goodman: Our next question is coming from the line of Mark Goodman with SVB Lehring. Yeah, just a continuation there. On the value enhancement plan, you've talked about monetizing non-core assets. I'm just kind of curious what your thoughts are back there.

Great. Good morning, Thanks for taking the questions.

I was just wondering if you can.

Provide us with your latest expectations for how the weight data for Labelle, the might be and incorporate into the label on what the potential outcomes are there and then I know you mentioned, adding an additional 50 sales reps here.

Iain Michael Brown: And additionally, in the oncology area, you were talking about, I'm curious, we're still thinking about maturing this data throughout the year before you start those types of discussions or certainly sign anything. I'm just kind of curious how your thought process is there, and maybe you could just lay out, secondly, just a completely separate topic just on spending, obviously very light in the core, just give us a sense of how the spending goes throughout the If I kick off on that, I think with the monetization of the non-core assets, we've identified a number of areas that we're not continuing to focus on necessarily internally.

How much additional coverage would that give you of your targeted provider universe. I know you said, 60% so would that go to <unk>.

70% to 80%, maybe just help us think about how much.

Extra expansion and you get from those additions.

Yes, absolutely I'll take take both of those.

You're referring first to the weight efficacy trial, which is enlightened two that was a pivotal phase III trial, which showed.

Showed the benefit of.

<unk>.

Versus olanzapine and so we still to Richard's earlier earlier point, we're still and communications with the FDA. So we're not going to really comment on what the label is and actually until we have approval, but we are very encouraged and discussions have been consistent with our expectations in terms of the footprint coverage that's on.

Iain Michael Brown: We've talked about some of the non-core R&D programs, earlier stage R&D programs. And with regard to royalty monetization, we sort of covered that a little bit earlier with regard to, it's really a value proposition; we want to make sure that we get sufficient value. The R&D for us is our most valuable royalty stream at this point in time, and we just want to see the maturity of this new trajectory in order for us to be able to establish value there. From a spending perspective, I think we were very pleased with where Q1 came in. Expenses across the board were lower than both Q1 of last year and Q4 of last year.

And we're really excited about and that's actually a key leverage point for us as we launch into this new category with an oral product.

Currently our sales force covers about 60% of the target targeted audience, that's going on that's going to significantly ramp up once we add and a staged fashion and the additional sales professionals. Our expectation is when we get to launch that we're going to cover approximately 80% of the branded oral marketplace, which as you can imagine this is.

Substantial amount of coverage, which is it can allow us to have a very strong share of voice and the marketplace.

Richard F. Pops: And I think as we look out through the remainder of the year, from a cost of goods perspective, I anticipate that that will increase with increasing volumes, specifically of our proprietary products. On the R&D side, I think expenses will pick up a little bit as the Nember-Lukin program continues and we sort of launch into Artistry 6 and then the PROC program. And we also have the $25 million milestone in the second half of the year related to the kickoff of the HDAC 1140 program.

Our next question is from the line of my real Fat with Evercore. Please proceed with your question.

Hi, Thanks, so much for taking my questions I had I had a I had a few.

A few if I may maybe just one follow up to a prior comment can you just level set Richard.

And how we should expect the set up going into <unk> I realize there's a lot of companies reporting a lot of things and I. Just I know you guys emphasize safety and Tolerability. So maybe if you could level set us on if we should or should not expect any further meaningful updates on efficacy. That's one on sub Q I guess my question is we know there hasn't been.

Richard F. Pops: And then specifically with regard to SG&A, as Todd mentioned, I think we'll augment the sales force, and there will be some incremental spend. That'll be on a staged basis, though, which will be closer to the PDUFA timeline around June. And then maybe a little bit of incremental investment as we gain access to Lightbulb E as well.

And monotherapy responses, so far and and so we'll see how that shakes out but Meanwhile, we also know the PK profile is quite different from IV and I almost wonder why not perhaps try out a sub Q regimen, and where it's given five days on our ROE and then no further for the rest of the cycle.

Akash Tewari: So I think that's really the profile that we're looking at, but all in all, we're very comfortable with the guidance we went out with in the February timeframe, and hence we reiterated that guidance. Marcus Rich, I want to take on your question about the partnering, because I think what's so interesting in this IL2 space right now is how the various programs are segregating into their own lanes. They are clearly not interchangeable.

Could that create an opportunity for sub Q, assuming there hasnt already been a some sort of monotherapy activity.

And the last one theres a lot of buzz on Oh from the New administration on for new funding for Suboxone and I Wonder if there's anything unusual in the works, which could truly move the needle onto the trial. Thank you so much.

Richard F. Pops: And I think that nemvolucan in particular is emerging as a really important entrogen in this field. The existence of monotherapy efficacy and the availability of the sub-Q dose are two highly differentiating features of it. We really do want to elaborate on that sub-Q efficacy. It's just beginning to emerge now. With the recommended phase 2 dose and artistry 2 being achieved at the end of last year, we just opened up the

Good morning, tumor I Wonder and Wonder, where you were and the Q This morning and figure out.

I was on the Israeli call [laughter] Okay.

Okay and.

And I was incredibly impressed by all of the questions. You guys are asking about the Ericsson too as well so.

On the Sandy is really the effort at.

Expert on what we're going to be showing and <unk>, but as it relates to artistry two.

Richard F. Pops: We're fortunate that right on the threshold of investor day, we saw our first patient, our first response in PROC. But we expect that that sub-Q profile will continue to evolve. And you'll see at ASCO some of the actual pharmacodynamic features of the sub-Q presentation that are slightly different from the IV that we're encouraged by. As I've said before, we really don't want to spend any time in a partnering discussion trying to... Judge whether or not the sub-Q dose works, whether or not the drug is efficacious.

There's actually quite a bit of interesting data with respect to the PK PD relationship and.

And the Tolerability on the <unk> side and.

I think it's we've.

We have not presented all of that so we had some for for <unk>, but I think it's really important.

And the biology of the different presentation as well with respect to monotherapy for a few we actually think the regimen and Q weekly at three <unk> is going to drive monotherapy efficacy.

We're not worried about that but your question is a good one because it opens up a broader question, which is for example are there other more clinically tolerable IV regimens rather than daily IV times five we actually believe there are are there are there combinations of IV induction plus sub Q maintenance. We believe there are theyre just infinite per.

Richard F. Pops: We can do that all on our own. When we move into the partnering discussions, it's about what indications we should go after, how we expand this program, and how we create the most medical and economic value for nebulogans. I think that data set will continue to mature this year, but I think we can hear the drum beating in the distance now.

Permutations and where we are now on the program of focusing the spend down and coring coring. It down on its first approval pathways is what is what is is puts focus of the program on the sub Q side, though if we felt like there were other regimens that would improve our probability of seeing that thing and we would change, but we're quite we're quite pleased.

Richard F. Pops: The next question is from the line of Akash Tewari with Wolf Research. Hi, this is Amy. I'm for Akash. Thanks so much for taking our questions. We just have a couple on

Amy Li: I just had a couple on your Erexin program. So as you think about the design of your lead candidate and the competitive space, what specific properties are you optimizing for? Is it half-life, blood-brain barrier penetration, or selectivity? Just looking at your early data in DTEA mice, it looks like you're leading to more potent drops in cataplexy and benefits on wakefulness at lower doses compared to Takeda's, and although we'll acknowledge it's early data, but just wanted to kind of think about how you're looking at the design of your molecule. And then another one, in terms of the blood pressure increases in polycuria in Takeda's Erexin trials, do you think this is an on-target OX2R-related effect or an off-target OX1R-related effect?

With the Q weekly and recall that we also have a Q3 Q3 weekly regimen and we think also has appropriate pharmacodynamic response, but we think that Q weekly is actually the first place to start.

On the suboxone.

And it's interesting there is a couple of things going on with Suboxone liberalization of some box and prescribing.

As anticipated some box and as you know is 95% on the market. So.

And things that happened in suboxone market really don't affect the vitriol market that much because <unk> was a different patient individual patient is the patient who wants to undergo detoxification and receive monthly antagonist therapy. So the other the other big tectonic plate moving and Suboxone World of course is the opioid settlements, where Teva and and others are.

Richard F. Pops: And any color you can add here would be super helpful. Thanks. Well, this sounds like you're ready for

Suggesting that part of the consideration and settlement is provision of free suboxone.

Richard F. Pops: Well, this sounds like you're ready for a conversation with some of the folks on the research team, but I'll give you our perspective on this. You know, things like PK profile, P-to-TROF, partition coefficient, half-life, you know, these technical aspects are all part of the design, but they translate into something, the way we view it is from the patient perspective, which is what we're looking for is a once-daily, well-tolerated, low side effect profile agent to address the clinical condition. And we see white space compared to what other companies are doing

States, which we don't think is going to change and the dynamic vis vis vis roll at all but but Todd and you feel free to come and yes, I totally agree rich the way that we think about this in terms of suboxone as they're completely different the indication for these products is different debt.

Clinical uses different and the patient journey is different we are very well aware of the changes and administration with the elimination of the waivers we watch that very closely.

But we really believe in and we talk very we follow the patient journey and we talked to our customers and we know that these products are used differently.

I think the way to think about the opportunity for for <unk> really is based upon the evidence based standards that are available to label the broad clinical use and the opportunity with and alcohol as we've talked about for the last couple of months. It's an enormous opportunity for 14 of 14 million Americans suffer from as you do on a.

Douglas Dylan Tsao: And it also leverages something that we've spent a lot of time focused on over many years, which is the relationship between pharmacokinetics, pharmacodynamics, blood-brain penetration, CNS exposure versus peripheral exposure, and mitigating or accentuating pharmacodynamic effects of various molecules based on the waveform or presentation to the periphery or the brain. So I won't bore everybody with all the specifics of the questions that you asked, and I will recommend that we have a follow-up conversation with you, because there's a lot of science here, there's a lot of data, and we're happy to answer any questions. Thank you so much. Our next question is coming from the line of Douglas Tsao with H.C. Wainwright. You might be muted, Doug.

Only 400000 are on therapy, and we're seeing nice growth with <unk> X and <unk> are growing on about a 3% basis year over year, and we think that <unk> has an opportunity to offer a nice value proposition for those patients. So that's something that we are extremely focused on right now.

And I'll just I'll just close the loop on on ESCO, and we're going to use the opportunity to provide a comprehensive update on the number look and program and recall that at our recent Investor Day. We did just provide a data update related more narrowly to meet and total melanoma and platinum resistant ovarian cancer.

For for the IV program, we will plan to provide we will plan to refresh that data and also provide a broader update across other tumor types in that study and.

unknown: Mr. Cellulite is open to questions. Mr. Shibutani. Mr. Shibutani.

And then on the RT and <unk> said Keith side, the focus of the presentation will really be a broader analysis of the PK PD and safety from that study and we will provide an update on any signals that we're seeing in the early enrollment of the of the efficacy expansion stage.

unknown: Why don't we move on, and we can circle back if Doug can reestablish his line? Sure, our next question will be coming from Jason Gerber, Bank of America. Hi everyone, this is Chiang for Jason. Thanks for taking our questions. Two from us. First one on Vimerity. Partner Biogen declined to comment on the impact of Tefidera pattern rulings, possibly removing generic subvectors from the market.

Thank you so much.

Jason Gerber: But I'm curious if you can comment on how big of a positive from Vimerity it would be if generic Tefidera came off the market. I guess a follow-up on Nembo Lucan. Are you able to confirm the couple of unconfirmed responses that you showed at Investor Day, or is this something an update that we can look forward to at ASCO? Thank you. I'll take the first one; maybe Sandy can take the second one.

Thank you Rob we have time for one more question. Please.

Second question will be coming from the line of Douglas Tsao with H C. Wainwright.

Hi, good morning, sorry about that earlier.

Just as a follow up for the question in terms of it'll evolve the sales force expansion I know you sort of gave the characterization in terms of how much more of the universe, you'll be able to coverage. Just curious if you could characterize the types and physician that youll now be targeting debt arent currently targeted by the hour startup sales force. Thank you.

Yes, absolutely Doug I'll take that this is Todd as well and we're going to we're going to cover north of the approximately 20000 physicians overall.

It will include about 80% of all branded prescribers with CIT and which encompasses approximately 9% of the total marketplace current currently with within the air start and marketplace early EIS as well our focus there really is on led by prescribers. So youre looking at our universe. There are approximately about 10000.

Richard F. Pops: The experts on the interaction between vimerity and tech are Biogen, and you should really focus on that. From our perspective, I can tell you... Umerity was designed as a next-generation ephemeris, with benefits for patients, namely in the form of preserving the proven efficacy of monomethylfumarate in a dosage form in a molecule that's more GI-tolerant. And that's what we're seeing in the real world.

So the the universe is much larger obviously when you go into the oral and.

Ian said, we made some adjustments to our commercial organization late last year and this year to increase our share of voice, we're very pleased with that share of voice.

And we're looking for to expanding coverage, it's gonna be psychiatrist and it'll be nurse practitioners and it'll be and of the health system market with IBM and institutions as well, we're going to have a bra for very broad footprint across the U S. It will be very HCP focused and we're very confident that we're going to have a strong share of voice.

Sandra Coombs: So our view is that Vumeri represents a generational advance for the benefit of patients, and that's what should drive its increased utilization in the clinic. On the Nambalookan side, Sandy, do you want to answer? On the Nevin Baloukin side, sorry, repeat your question, Chi. Yeah, a couple of unconfirmed responses. Are you able to confirm them? Yeah, we won't comment on that during this

And to compete and the branded space.

Okay, great. Thank you so much.

Thanks, Ed.

Okay, and thanks, everyone for joining us on the call. This morning, we appreciate the questions. If there any follow ups. Please don't hesitate to reach out to us at the company have a great day.

This concludes today's conference you may disconnect your lines at this time. Thank you for your participation.

Terrence Flynn: You can look forward to ACCA for an update on any additional confirmation. Awesome, thanks so much. Thank you. Our next question is from the line of Terrence Flynn with Goldman Sachs. Good morning.

Todd: Thanks for taking the questions. I was just wondering if you could provide us with your latest expectations for how the weight data for Libalvi might be incorporated into the label, and what the potential outcomes are there. And then I know you mentioned adding an additional 50 sales reps here. How much additional coverage would that give you in your targeted provider universe? I know you said 60 percent, but would that go to 70 or 80 percent?

Todd: Maybe just help us think about how much extra expansion you get from those additions. Thanks. Yeah, absolutely. I'll take both of those.

Todd: You're referring first to the weight efficacy trial, which is Enlightened 2. That was a pivotal phase three trial that showed the benefit of Lebalvy versus Olanzapine. So we still to Rich's earlier point, we're still in communications with the FDA. So we're not going to really comment on what the label is or actually until we have approval. But we are very encouraged, and the discussions have been consistent with our expectations.

Todd: In terms of the footprint coverage, that's something we're really excited about, and that's actually a key leverage point for us as we launch into this new category with an oral product. Currently, our sales force covers about 60% of the targeted audience.

Umer Raffat: That's going to significantly ramp up once we add, in a staged fashion, additional sales professionals. Our expectation is that when we get to launch, we're going to cover approximately 80% of the branded oral marketplace, which, as you can imagine, is a substantial amount of coverage which is going to allow us to have a very strong share of voice in the marketplace. Our next question is from the line of Umer Raffat with Evercore, who's received... Hi, thanks so much for taking my questions. I had a few, if I may.

Richard F. Pops: Maybe just one follow-up to a prior comment. Can you just level set, Richard, what we should expect from the setup going into ASCO? I realize there are a lot of companies reporting a lot of things, and I know you guys emphasize safety and tolerability, so maybe if you could level set us on whether we should or should not expect any further meaningful updates on efficacy. That's one.

Richard F. Pops: On sub-Q, I guess my question is, we know there haven't been monotherapy responses so far, and so we'll see how that shakes out. But meanwhile, we also know the PK profile is quite different from IV, and I almost wonder why not perhaps try out a sub-Q regimen where it's given five days in a row and then no further for the rest of the cycle. Could that create an opportunity for sub-Q, assuming there hasn't already been some sort of monotherapy activity?

Richard F. Pops: And the last one, there's a lot of buzz from the new administration on new funding for suboxone, and I wonder if there's anything unusual in the works which could truly move the needle on Vivitrol. Thank you so much. Good morning, Umer. I wonder where you were in the queue this morning.

Richard F. Pops: I was on the Israeli call. Okay. Okay. And I was incredibly impressed by all the questions you guys asked about the Erekson 2 as well. Sandy is really the expert on what we're going to be showing at ASCO, but as it relates to Artistry 2. There's actually quite a bit of interesting data with respect to the PK-PD relationship and the tolerability of the subject. I think that we've not presented all of that, so we had some for ASCO, but I think it's really important to discuss the biology of the different presentations as well.

Richard F. Pops: With respect to monotherapy steps, we actually think the regimen Q weekly at 3 mg is going to drive monotherapy efficacy. We're not worried about that, but your question is a good one because it opens up a broader question, which is, for example, are there other more clinically tolerable IV regimens rather than daily IV times 5? We actually believe there are. Are there combinations of IV induction plus sub-Q maintenance?

Todd: We believe there are. There are just infinite permutations, and where we are now in the program of focusing the spend down and coring it down on its first approval pathways is what's focused. On the Sub-Q side, though, if we felt like there were other regimens that would improve our probability of seeing that signal, we would change, but we're quite pleased with the Q-weekly. And recall that we also have a Q-3 weekly regimen that we think also has an appropriate pharmacodynamic response, but we think that the Q-weekly is actually the first place to start. On the Suboxone... It's interesting.

Richard F. Pops: There are a couple things going on with Suboxone. Liberalization of Suboxone prescribing is anticipated. Suboxone, as you know, is 95% of the market. So things that happen in the Suboxone market really don't affect the Vivitrol market that much because Vivitrol is for a different patient. The Vivitrol patient is the patient who wants to undergo detoxification and receive monthly antagonist therapy. So the other big tectonic plate moving in the suboxone world is the opioid settlements, where Teva and others are suggesting that part of the consideration in the settlement is the provision of free suboxone to states, which we don't think is going to change the dynamic vis-à-vis Vivitrol at all. But Todd, feel free to comment on that. Yeah, I totally agree, Rich.

Todd: The way that we think about this in terms of suboxone is that they're completely different. The indication for these products is different. The clinical use is different, and the patient journey is different. We are very well aware of the changes in administration with the elimination of waivers. We watch that very closely. But we really believe in it, and we talk very, you know; we follow the patient journey. We talk to our customers, and we know that these products are used differently. I think the way to think about the opportunity for Vivitrol is really based upon the evidence-based standards that are available, the label, the broad clinical use, and the opportunity with alcohol.

Sandra Coombs: As we've talked about for, you know, the last couple of months, it's an enormous opportunity. 14 million Americans suffer from AUD, only 400,000 are on therapy, and we're seeing nice growth with TRX. Actually, TRXs are growing on about a 3% basis year over year, and we think that Vivitrol has an opportunity to offer a nice value proposition for those patients, so that's something that we are extremely focused on right now. And I'll just close the loop on ASCO.

Sandra Coombs: We're going to use this opportunity to provide a comprehensive update on the NumbVolucan program. Recall that at our recent investor day, we did just provide a data update related more narrowly to mucosal melanoma and platinum-resistant ovarian cancer for the IV program. We'll plan to provide, we'll plan to refresh that data and also provide a broader update across other tumor types in that study. Then on the RS3-2 sub-Q side, the focus of the presentation will really be a broader analysis of the PK, PD, and safety from that study.

Sandra Coombs: And we'll provide an update on any signals that we're seeing in the early enrollment of the efficacy expansion stage. Thank you so much. Thank you. Rob, we have time for one more question, please. Yes, that question will be coming from the line of Douglas Tsao with HE Wing. Douglas Goldstein, CFP®, is the director of Profile Investment Services and the host of the Goldstein on Gelt radio show. His book Building Wealth in Israel is available in bookstores, on the web, or can be ordered at www.profile-investment.com.

Douglas Dylan Tsao: Yeah, absolutely, Doug. I'll take that. This is Todd as well.

Todd: So we're going to cover north of approximately 20,000 positions overall, which will include about 80% of all branded prescribers, which encompasses approximately 9% of the total marketplace. Currently, within the Aristata marketplace, LAIs as well, our focus there really is on LAI prescribers. So you're looking at an universe there of approximately about 10,000. But the universe is much larger.

Todd: Obviously, when you go into oral, as Iain said, we made some adjustments to our commercial organization late last year and this year to increase our share of voice. We're very pleased with that share of voice. And we're looking forward to expanding coverage. It's going to be psychiatrists. It'll be nurse practitioners. It will be in the health system market with IDNs and institutions as well. We're going to have a very broad footprint across the US that will be very HCP focused, and we're very confident that we'll have a strong share of voice to compete in the branded space.

unknown: Okay, great. Thank you so much. Thanks, guys. Okay, thanks everyone for joining us on the call this morning. We appreciate the questions. If there are any follow-ups, please don't hesitate to reach out to us at the company. Have a great day.

unknown: This concludes today's conference.

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