Q2 2021 Neurocrine Biosciences Inc Earnings Call

Okay.

Operator: Good day, everyone, and welcome to today's Neurocrine Biosciences Report second quarter results. At this time, all participants are in a listen-only mode. Later, you will have the opportunity to ask questions during the question and answer session. You may register to ask a question at any time by pressing the star and one on your touchtone phone.

Good day, everyone and welcome to today's Neurocrine Biosciences reports second quarter of results.

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

You will have the opportunity to ask questions. During the question answer session.

You May register to ask a question of anytime by pressing the star and 1 on your Touchtone phone.

Operator: Please note this call may be recorded, and I will be standing by should you need any assistance. It is now my pleasure to turn the conference over to your Vice President of Investor Relations, Todd Tushla. Please go ahead.

Please note this call maybe recorded and I will.

I'll be standing by should you need any assistance. It is now my pleasure to turn the conference over to your Vice President of Investor Relations Todd to Shlomi. Please go ahead.

Todd Tushla: Thanks, Chloe. Good afternoon, and thank you for joining us on our second quarter 2021 earnings call. On today's call is Kevin Gorman, our Chief Executive Officer; Matt Abernethy, our Chief Financial Officer;

Thanks Lloyd.

Afternoon, and thank you for joining us on our second quarter 2021earnings call on today's call is Kevin Gorman, Our Chief Executive Officer, Matt Abernethy, Our Chief Financial Officer, I read Roberts, our Chief Medical Officer, Eric benefits, our Chief commercial officer from Kyle Gano, our chief business development and strategy Officer.

Todd Tushla: Financial Officer, Eiry Roberts, our Chief Medical Officer, Eric Benevich, our Chief Commercial Officer, and Kyle Gano.

Todd Tushla: Commercial Officer, and Kyle Gano, our Chief Business Development and Strategy Officer. During today's call, we will be making forward-looking statements. These statements are subject to certain risks and uncertainties, and our actual results may differ materially.

On today's call, we will be making forward looking statements. These statements are subject to certain risks and uncertainties and our actual results may differ materially I encourage you to review of the risk factors discussed in our latest SEC filings. After our prepared remarks, we will then head and the question and answer session, where we ask you to please limit yourself. The 1 question. So we can get to as many questions.

Todd Tushla: I encourage you to review the risk factors discussed in our latest SEC filings. After our prepared remarks, we will then head into a question and answer session, where we ask you to please limit yourself to one question so we can get to as many questions as possible. At this point, I'll hand the call over to Kevin Gorman. Thank you, Todd. Good afternoon, everyone.

Possible.

At this point I'll hand, the call over to Kevin Gorman.

Thank you Todd and good afternoon, everyone.

Kevin C. Gorman: As you saw in our earnings release just a little bit ago, we had a very good second quarter, with Ingresa prescriptions bouncing back strongly from the Q1 level. We attribute this to two main factors, a lessening of the pandemic during Q2 and the very good work of our sales, marketing, and medical teams in utilizing new tools to educate and engage with health care providers. Now we are still in an environment where greater than 50% of psychiatry visits a telemedicine clinic, but I think, as you can see, we are adapting well.

As you saw the earnings release, just a little bit of go we had a very good second quarter with.

Within grasp the prescriptions bouncing back strongly from the Q1 levels.

We attribute this to 2 main factors a lessening of the pandemic during Q2 and the very good work of our sales marketing and medical teams and utilizing new tools to educate and engage with health care providers.

Now we are still in an environment, where greater than 50% of psychiatric of psychiatry. That's that's the telemedicine, but I think as you can see we are adapting well to this now.

Kevin C. Gorman: Now we exited Q2 strong, and this bodes well for Q3. However, we do face headwinds, you are all aware I'm not telling you anything you don't know that the pandemic has worsened in the past several weeks with the spread of the delta variant. Now, in those pockets of the country that are less vaccinated, we are seeing clinics closing, and offices are starting to restrict access. Also, while Q3 has seasonality where growth is not as strong as Q2 and Q4, we've said that now for four years. But we do anticipate sequential growth, acknowledging that the Delta variant adds more unpredictability versus prior years. I want to emphasize the bottom line.

We exited Q2 strong and this bodes well for Q3, however, we do face headwinds.

You are all aware I'm not telling you anything you don't know the pandemic has worsened in the past several weeks with the spread of the Delta of area now.

Now in those pockets of the country that are less vaccinated, we are seeing clinics closing and the offices are starting to restrict access to us.

Also while Q3 has a base of seasonality where growth is not as strong as Q2 and Q4, we've said that an outflow of 4 years.

But we do anticipate sequential growth the.

Acknowledging that the Delta variant adds more unpredictability versus prior years.

I want to emphasize the bottom line of sales in the short term, we have adapted to this new environment and of showing record prescriptions.

Kevin C. Gorman: In the short term, we have adapted to this new environment and are showing record prescription rates. However, in the long term, the fundamental opportunity to help more patients remains unchanged. Only two out of ten TARDAC dyskinesia patients are diagnosed, and only one out of ten are being treated consistent with APA guidelines. That is with a VMAT2 inhibitor. We continue to invest substantial resources in Ingresa. And the rest of the team will go into this in greater detail on this call.

In the long term the fundamental opportunity to help more patients remains unchanged only 2 out of 10 tardive dyskinesia patients are diagnosed and only 1 out of 10 are being treated.

With a P of guidelines that is with the V mapped 2 inhibitor.

We continue to invest substantial resources hunting grassley and the rest of the team will go into this in greater detail on this call.

Kevin C. Gorman: Switching over, I'm very pleased with the progress of our pipeline. At the beginning of the year, we set out to start nine mid- to late-stage clinical trials this year, and we are on track to initiate all nine by year-end. This is no small feat considering a number of these clinical studies are in Europe, where the region continues to be seriously impacted by COVID far more than the U.S. Professor Fontan C.A.H., our precision medicine approach to various epilepsy indications and movement disorders, and our psychiatry programs are all moving forward nicely.

Switching over them I'm very pleased with the progress of our pipeline at the beginning of the year, we set out the stark 9 mid to late stage clinical trials of the C. R. And we are on track to initiate all 9 by year end.

This is no small feat considering a number of these clinical studies are in Europe, where the region continues to be seriously impact by COVID-19 far more than the U S.

Yes.

Credential of fought in CAH, our precision medicine approach and various epilepsy indications of movement disorders, and our psychiatry programs are all moving forward nicely.

Kevin C. Gorman: So I'll turn the call over to my colleagues, starting with Matt. Thank you, Kevin. Ingress's second quarter sales of $265 million, with underlying demand of $269 million, reflect the dedicated efforts across our commercial and medical repair team.

So I'll turn the call over to my colleagues starting with map.

Thank you, Kevin and growth of second quarter sales of $265 million with underlying demand of $269 million reflects the dedicated efforts across our commercial and medical affairs team.

Matthew C. Abernethy: In addition to record TRX levels, we achieved our highest quarterly NRX performance since last March, driven by increased salesforce activity. As we head into the second half of the year, we expect some near-term bumpiness, keeping a close eye on both telemedicine and the impact of the Delta variant on society. Telemedicine still accounts for greater than 50% of visits in psychiatry, and we see restricted access to clinics and pockets of the country due to the recent rise in COVID cases. We do expect Ingresa growth will continue into the third quarter and anticipate sequential growth will be near past third-quarter trends of around $15 million, driven by strong commercial execution, tempered somewhat by normal seasonal dynamics.

In addition to record here ex levels, we achieved our highest quarterly interacts performance since last March driven by increased sales force activity.

As we head into the second half of the year, we expect some near term bumping is keeping a close eye on both tele medicine and the impact of the Delta variant on society telemedicine still accounts for greater than 50% of visits in psychiatry, and we see restricted access to the clinics in pockets of the country.

Due to the recent rise in Covid cases.

We do expecting graduate growth will continue into the third quarter and anticipate sequential growth will be near past third quarter trends of around $15 million driven by strong commercial execution tempered somewhat by normal seasonal dynamics, regardless of the near term variability in telemedicine.

Matthew C. Abernethy: Regardless of the near-term variability in telemedicine and the pandemic, our long-term optimism remains, given the growth we're seeing in this current environment, and we'll continue to adapt accordingly. Turning to costs, we continue to make investments in advancing our programs in R&D, and our P&L reflects the first full quarter of investment in branded and Grza DTC, which we anticipate will more fully contribute to sales as we progress Finally, with over $1.2 billion in cash, we continue to have the financial flexibility to execute our strategy. With that, I will now hand the call over to Eiry Roberts, our Chief Medical Officer. Eiry.

And the pandemic, our long term optimism remains given the growth we're seeing in this current environment and will continue to adapt accordingly.

Turning to costs, we continue to make investments advancing our programs in R&D and our P&L reflects the first full quarter of investment in branded and graduate of DTC, which we anticipate will more fully contribute to sales as we progress into 2022.

Yeah.

Finally with over $1.2 billion in cash we continue to have the financial flexibility to execute our strategy.

With that I will now hand, the call over the Ivory Roberts, our Chief Medical Officer IRA.

Eiry W. Roberts: Thanks, Matt. And good afternoon to everyone on today's call. I'll keep my prepared remarks focused this afternoon on Ingresa Valbenazim, beginning with an update on our Valbenazine franchise, which serves as a prototypical example of Neurocrine's commitment to a pipeline within a program. I'm pleased to announce that our Phase 3 Registrational Study in Huntington's Disease, CONNECT-HD, is now fully enrolled, and we remain on track to deliver top-line results by year-end. Many thanks to the team at Neurocrine, our incredible partners at the Huntington Study Group, and the University of Rochester, CTCC, to all the Connect HD investigative staff, and especially to the patients and families for their collaboration and perseverance in For Ingresa, our medical focus this year has remained heavily on education.

Thanks, Matt and good afternoon to everyone on today's call.

I'll keep my prepared remarks focus this afternoon on a gross of Val benzene beginning with the updates on all of our benzene franchise, which serves as the prototypical example of neurocrine commitment to of pipeline within the program.

I'm pleased to announce that our phase III Registrational study in Huntington's disease Kinect HD is now fully enrolled and we remain on track to deliver top line results by year end.

Many thanks to the team at Neurocrine are incredible partners at the Huntington study group and the University of Rochester C. T C C.

All of the connect H, the investigative stocks and especially the patients and families for the collaboration and perseverance and completing enrollment even in the face of all the challenges posed by the pandemic.

During the medical focus this year has remained heavily on education in the second quarter. We presented data from several studies focused on educating clinicians on the impact of tardive dyskinesia on patients and care partners on.

Eiry W. Roberts: In the second quarter, we presented data from several studies focused on educating clinicians on the impact of tardive dyskinesia on patients and care partners, on how to recognize and effectively assess TD through telemedicine, and further education on the differentiated pharmacology of VMAT2 inhibitors in TD. In addition, the Journal of Clinical Psychopharmacology awarded our ReConnect paper the Mitchell B. Balter Award in Pharmacoepidemi We're pleased that the editors recognized the importance of the ReConnect study in seeking to document the presence and impact of tardive dyskinesia by using innovative assessment techniques in real-world outpatient practice settings.

On how to recognize and effectively assess T D through telemedicine.

And the other education on the differentiated pharmacology of the my 2 inhibitors and T D.

In addition, the journal of clinical Psychopharmacology awarded a reconnect paper with the Mitchell B Boldt, Oh, well, it's in pharma Coapt the D neology.

We're pleased that the editors recognize the importance of the reconnect study in seeking to document the presence and impact of tardive dyskinesia by using innovative assessment techniques in real world outpatient practice settings.

Eiry W. Roberts: Although tardive dyskinesia has been extensively studied in controlled clinical trials, there remains a pressing epidemiologic and public health need to understand the extent and burden of tardive dyskinesia experienced by patients, caregivers, and clinicians in routine practice.

All of the Tardive dyskinesia has been extensively studied in controlled clinical trials. The remains of pressing epidemiologic and public health need to understand the extent of the next tardive dyskinesia experienced by patients caregivers and clinicians in routine practice.

Eiry W. Roberts: The ReConnect study remains the largest such study conducted to date in this field, and the ongoing analysis of data from this program continues to inform our support of patients suffering with TD. Thank you to the team at Neurocrine and all our external partners who have contributed to the ongoing data generation and education from the ReConnect study. In addition, today we announced we are investigating two new potential indications for valbenazine with the intent to initiate registrational studies for each indication before the end of this year.

The reconnect study remains the largest such study conducted to date in this field and the ongoing analysis of data from this program continues to inform our support of patient suffering but T D.

Thank you to the team at Neurocrine and all of our external partners, who have contributed to the ongoing data generation and education from the reconnect study.

In addition, today, we announced we are investigating 2 new potential indications about the entity with the intent to initiate registrational studies for each indication before the end of the yeah.

Eiry W. Roberts: The first program in psychiatry will study valbenazine as a potential adjunctive therapy for the treatment of schizophrenia. Antipsychotic medications alone are often inadequate to address all the symptoms and functional limitations experienced by individuals with schizophrenia. In addition, about 30% of people living with schizophrenia who take antipsychotic therapy experience relapse in their psychotic symptoms, which creates a significant need for effective adjunctive medications to treat these debilitating symptoms of psychosis. The second program in neurology will study valbenazine as a potential treatment for dyskinesia due to cerebral palsy.

The first program in psychiatry, well studied Val benzene is of pigeon potential adjunctive therapy for the treatment of schizophrenia.

Antipsychotic medications alone often inadequate to address all of the symptoms and functional limitations expenses experienced by individuals with schizophrenia.

In addition of about 30% of people living with schizophrenia, who take antipsychotic therapy experience relapse in the psychotic symptoms, which creates a significant need for effective adjunctive medications to treat the debilitating symptoms of psychosis.

The second program in neurology.

The Val benzene as the potential treatment for of dyskinesia due to cerebral palsy.

Eiry W. Roberts: Cerebral palsy is the most common cause of motor disability in children, affecting about 3 in 1,000 children in the U.S. Dyskinesia due to cerebral palsy presents in early childhood but persists into adulthood and affects approximately 15% of those with cerebral palsy. There are currently no approved treatments for dyskinetic cerebral palsy.

So I will pause the is the most common cause of most of the disability in children of thinking about 3 and 1000 children in the U S.

Dyskinesia due to the cerebral palsy presents an early childhood, but the tests into adulthood unaffected approximately 15% of those with cerebral palsy.

There are currently no approved treatments for disconnected cerebral palsy.

Eiry W. Roberts: Many patients end up taking multiple medications off label with low efficacy rates and unwanted side effects. New therapies are, therefore, significantly needed in this patient population. So, why these indications and why now? The collective combination of valbenazine's mechanism of action as a highly selective inhibitor of VMAT2 with a differentiated pharmacological profile, together with the extensive safety database that exists in patients with tardive dyskinesia treated with Ingresa, coupled with positive anecdotal clinical evidence generated in the field, provide a compelling reason for investment in both of these new indication

Many patients end up taking multiple medications off label with low efficacy rates, an unwanted side effects.

New therapies of therefore significantly needed in this patient population.

So why these indications and why now.

The collective combination of both benzene the mechanism of action as the highly selective inhibitor of the not too with the differentiated pharmacological profile together with the extensive safety database that exists in patients with tardive dyskinesia and treated with the grades are coupled with positive anecdotal clinical.

Evidence generated in the field provide a compelling reason for investment in both of these new indications.

Eiry W. Roberts: We know you may have many questions regarding study design and other details which we are unable to address right now. However, we look forward to sharing more information with you once these studies are published on clinicaltrials.gov later this year. In closing, I'll comment briefly on the remainder of our R&D portfolio. I'm proud of the team's work in steadily expanding the Neurocrine portfolio. The team is currently supporting a portfolio of approximately 50 ongoing clinical trials, including adult and pediatric studies of Cronesophon for the treatment of classical congenital adrenal hyperplasia.

We know you may have many questions regarding study design of the details of which we're unable to address right. Now. However, we look forward to sharing more information with you. Once these studies post of clinical trials later this year.

In closing I'll comment briefly on the remainder of our R&D portfolio.

I'm proud of the team's work and steadily expanding the neurocrine portfolio. The team is currently supporting a portfolio of approximately 50 ongoing clinical trials.

The adult and pediatric studies of connects the pond for the treatment of classical congenital adrenal hyperplasia.

Eiry W. Roberts: I'm also pleased with the steady progress we are making in study initiation and enrolment this year across our newer programs. Importantly, we remain on track to initiate nine mid to late stage studies in 2021, which will, in turn, lead to important data readouts over the course of 2022 and beyond. With that, I'll turn things back to you, Kevin. Thank you guys very much, Eiry and Matt.

I'm also pleased with the steady progress we are making in study initiation and enrollment this year across the on newer programs.

Fortunately, we remain on track to initiate 9 mid to late stage studies in 2021, which will in turn lead to important data readouts over the course of 2022 and beyond.

With that I'll turn things back to you Kevin.

Thank you guys very much I read them out so at this point without them of our prepared remarks, and the operator I'd like to open it up for questions.

Kevin C. Gorman: So at this point, we're done with our prepared remarks, and operator, I'd like to open it up for questions. Absolutely. At this time, if you'd like to ask a question, please press the star and one on your touchtone phone. You may withdraw your question at any time by pressing the pound. Thank you once again for your questions. That is, the star and one.

Absolutely at this time, if you'd like to ask a question. Please press the star and 1 on your Touchtone phone he.

You may withdraw your question at any time by pressing the pound key.

And once again for your questions that of Star and 1.

1.

And we will take our first question from T Z net of a Mod from Bank of America. Please go ahead.

Okay. Good afternoon. Thanks, so much for taking my question and congratulations on a great quarter. We know you could do it we know it was just a matter of time.

Operator: And we will take our first question from Tazeen Ahmad from Bank of America. Please go ahead. Okay, good afternoon. Thanks so much for taking my question. And congratulations on a great quarter. We knew you could do it. We knew it was just a matter of time.

So as it relates to the dynamics Kevin can you just clarify did you actually see more doctors going back to in person visits to queue and you.

Tazeen Ahmad: So as it relates to the dynamics, Kevin, can you just clarify? Did you actually see more doctors going back to in-person visits into Q? And, you know, are you seeing, based on what you commented on, that the impact of Delta might be decreasing that? Or was your ability to draw these results more based on the changes that you've been talking about related to adopting to pitching more virtually versus in person? If you can clarify, that'd be great.

Are you seeing based on what you commented on but the the impact of delta might be decreasing that or what was your ability to to the draw. These results more based on the changes that you had been talking about.

Related to adopting to the pitching more virtually versus in person. If you can clarify that'd be great. Thanks, yeah. Thanks to the thing I appreciate the question.

So I'm going to the right.

Put it over on Eric other than to just say kind of quickly as I said in the opening remarks. It continues to be the case, where psychiatrists are.

Kevin C. Gorman: Thanks. Yeah, thanks, Tazeen. I appreciate the question.

Kevin C. Gorman: So I'm going to put it over on Eric, other than to just say kind of quickly, as I said in the opening remarks, it continues to be the case that about 50% of psychiatric visits are still through telemedicine. Different from neurologists, the movement disorder specialists we call them, they're virtually 100% in person. But while they 50% of their practices are in telemedicine, more offices opened up during Q2, and so there was more access to other health care professionals in the office even if the psychiatrist was not available there. For more color on what you've been asking about, Eric, could you could answer that? Yeah, Hi Tazeen.

About 50 per cent.

Of psychiatric visits are still through the telemedicine different from neurologists look with the sort of specialists, we call them theyre virtually 100 per cent in person.

But while they the 50 per cent of their practices are in telemedicine.

More offices opened up during Q2, and so there was more access.

2 other health care professionals in the office, even if the psychiatrist supposed to the other available there but for the for more color on on what you've been asking you about Eric could you could you answer that.

Yes, hi.

I think it's a little bit of everything.

What you what you described there over the course of.

Exiting Q1 and throughout Q2, we did see that more of the practices, we're seeing more of their patients in person so a bit of a shift.

Eric S. Benevich: I think it's a little bit of everything, you know, what you described there. Over the course of, you know, exiting Q1 and throughout Q2, we did see that more of the practices were seeing more of their patients in person, so a bit of a shift. And, of course, more of these practices were opening up and allowing access to our people. So it's a combination of all these things.

And of course more.

More of these practices were opening up and allowing access to our people.

So it's a combination of all of these things.

And then as we mentioned in the prepared remarks more recently.

Have seen with the recent.

Recent.

Surge in the end of the Corona virus.

Eric S. Benevich: And then, as we mentioned in the prepared remarks more recently, we have seen in some pockets in some areas of the country where there are starting to be some new restrictions imposed, including restrictions on patients coming into clinics and restrictions on our ability to see our customers in person. So, you know, we're monitoring this very carefully. But certainly, you know, improving conditions on the ground are part of the story in terms of our performance in Q2. Okay, let's take the next question. We'll move next to Phil Nadeau with the Cohen Company. Please go ahead.

Some pockets of some areas of the country, where they're starting to be some new restrictions imposed including restrictions on patients coming into the clinics the restrictions on our ability to see our customers in person. So.

We're monitoring this very carefully but certainly.

The improving conditions on the ground are part of the story in terms of our performance in Q2.

Yeah.

Hello, Hey, let's take the next question.

Well move next to Phil Nadeau with Cowen <unk> Company. Please go ahead.

Good afternoon, and thanks for taking my question, let me add my congratulations on a productive quarter.

This is actually kind of a follow on to today's question and on the last quarter. The call you mentioned debt I believe overall volumes of psychiatrists, where 70% of normal I mean as you reiterated this time around Thomas It was 50% of those visits.

Phil Nadeau: Good afternoon. Thanks for taking my question. Let me add my congratulations on a productive quarter. This is actually kind of a follow-on to Tazeen's question. In the last quarter of the call, you mentioned that I believe overall volumes of psychiatrists were 70 percent of normal. And then, as you reiterated this time around, telemedicine was 50 percent of those visits. What is, where does it stand today for total volumes for psychiatrists? Have they recovered above 70% normal? And if so, where are they?

What is where does it stand today for total volumes for psychiatrists have they recovered above 70 per cent of normal and if so where are the and then kind of part 2 of the question is where do you think ultimately volumes in telemedicine.

Ooh will level off once once COVID-19 is in the past it seems reasonable to think that we'll never get back to 100% of the level of in person visits in the future but.

Based on the amount from last quarter of in person visits of 35 per cent of normal.

That also sounds far too low so where do you think ultimately that number could go to once COVID-19 is behind us.

Phil Nadeau: And then kind of part two of the question is, where do you think volumes in telemedicine will level off once COVID's in the past? It seems reasonable to think that we'll never get back to 100% of the level of in-person visits in the future. But based on the math from last quarter, if in-person visits are 35% of normal, that also sounds far too low. So where do you think that number could go once COVID is behind? Yeah, so

Yeah, Phil Thanks for the question of a bit of a crystal ball type of question that I think of lot of it is going to be determined about how the reimbursement takes place with CMS.

CMS will tell us that towards the end of the year.

For telemedicine versus in person calls you're right. So it's never it's never going to go back to what it was pre.

Pre pandemic.

Kevin C. Gorman: Yeah, Phil, thanks for the question, a bit of a crystal ball type question. I think a lot of it is going to be determined about how reimbursement takes place, and CMS will tell us that towards the end of the year for telemedicine versus in-person calls. You're right; it's never going to go back to what it was pre-pandemic. Where it settles out, whether it's going to be somewhere between 20% and 50% is the best guess and range that I can give you.

Where it settles out whether it's going to be somewhere between 20 and 50% is the best guess at the range that I can give you Eric would you like to talk about where a total volume of patients are at this point in your views.

Yeah. So total of total volume of of.

The reimbursed visits whether it's.

So the telemedicine visit or a face to face is still below what it was pre pandemic.

Based on the the most recent data that we've seen which are still a couple of months old.

It appears that it still hasnt, especially in psychiatry bounced back to pre pandemic levels and as we said over half of the total reimburse visits are alright, telemedicine visit where it ends up ultimately once we get past the pandemic.

Eric S. Benevich: Eric, would you like to talk about where the total volume of patients is at this point in your view? Yeah, so the total volume of, you know, reimbursed visits, whether it's through telemedicine visits or face-to-face is still below what it was pre-pandemic. You know, based on the most recent data that we've seen, which are, you know, still a couple months old, it appears that it still hasn't, especially in psychiatry, bounced back to pre-pandemic levels.

And the public health emergency.

Exploration is lifted it remains to be seen and certainly theres a lot of conversation happening.

From a public policy perspective about which of the waivers that were enacted last year in response to the pandemic should carryforward.

Certainly we recognize.

The telemedicine has played an important role, especially.

Eric S. Benevich: And as we said, you know, over half of the total reimbursed visits are telemedicine visits. Where it ends up ultimately, once we get past the pandemic and the public health emergency declaration is lifted, it remains to be seen.

Very early in the pandemic and allowing patients to have access to the providers, but we also recognize that there are some limits in terms of where it can and should be used and certainly for a movement disorder like paradigm of dyskinesia. There are some challenges debt.

Eric S. Benevich: And certainly, there's a lot of conversation happening from a public policy perspective about which of the waivers that were enacted last year in response to the pandemic should carry forward. You know, certainly we recognize that telemedicine has played an important role, especially very early in the pandemic and allowed patients to have access to providers. But we also recognize that there are some limits in terms of where it can and should be used.

Virtual visits represent especially as it relates to recognizing and diagnosing.

The new patients so.

As Kevin said and as Matt said, we continue to adapt to the environment and I think that the results that we that we that we described here for Q2 are testament to that.

But we also recognize that the things are going to continue to evolve.

Likely the proportion.

Proportion of total visits in psychiatry debt.

Eric S. Benevich: And certainly, for a movement disorder like tardive dyskinesia, there are some challenges that virtual visits represent, especially as it relates to recognizing and diagnosing new patients. So, as Kevin said, and as Matt said, you know, we continue to adapt to the environment. And I think that the results that we describe here for Q2 are testament to that. But we also recognize that things are going to continue to evolve. It is likely that the proportion of total visits in psychiatry that are virtual or telehealth will decrease over time.

Our virtual care telehealth will decrease over time, but.

No I don't think anyone expects that its going to go back to what it was pre pandemic.

The bi but for comparison sake in neurology.

The proportion of of Telehealth visits has gone down a fair bit.

Is.

Close to not exactly but close to what it was pre pandemic. So.

There's a meaningful difference I think in terms of the degree to which the psychiatry versus neurology has embraced telehealth and continues to expect to utilize telehealth going forward. So this is an important variable for.

For us, but we recognize it's not going away it might be less in the future.

Eric S. Benevich: But I don't think anyone expects that it's going to go back to what it was pre-pandemic. But for comparison's sake, in neurology, the proportion of telehealth visits has gone down a fair bit and is, close to, not exactly, but close to what it was pre-pandemic. So, you know, there's a meaningful difference, I think, in terms of the degree to which psychiatry versus neurology has embraced telehealth and continues to expect to utilize telehealth going forward.

But for us to be successful ultimately in.

The growing our aggressive franchise and helping as many patients as possible we need to continue to make TD recognition and diagnosis initiation of treatment with Inc. Reza.

Yes.

The simple straightforward and accurate as possible for our HCP customers.

And well move next to Paul <unk> with Stifel. Please go ahead.

Great. Thanks.

Thanks, So much for taking the question and let me add my congrats as well I wanted to ask 1 question about net price it looks like the second quarter didn't have the same cadence as prior years, 2 Qs, where you have a big net price improvement after kind of the whole <unk>.

Eric S. Benevich: So this is an important variable for us, but we recognize it's not going away. It might be less in the future, but for us to be successful ultimately in growing our Ingressa franchise and helping as many patients as possible, we need to continue to make PD recognition and diagnosis and initiation of treatment with Ingressa as simple, straightforward, and accurate as possible for our NCP customers.

The <unk> contracting dynamic is there anything to that should we expect gross to net to remain elevated throughout the rest of this year and is there anything behind that.

I have 1 quick follow up thanks.

Go ahead, Matt.

Yeah, Hey, Paul Nice to hear from you Yeah, we did not see the step back up like you have in previous years from a net price perspective, you did see some step up however, as we walked out of the donut hole exposure that we typically work through in Q1, what I'd say is that the elevated gross to net is something.

Paul Matteis: And we'll move next to Paul Mattis with Stifle. Please go ahead. Great. Thanks so much for taking the question. And let me add my congratulations as well.

You would likely see us stick with us for some period of time and that really reflects.

Paul Matteis: I wanted to ask one question about net price. It looks like this second quarter didn't have the same cadence as prior year's QQs, where you have a big net price improvement after kind of the whole 1Q contracting dynamic. Is there anything to that? Should we expect gross margin to remain elevated throughout the rest of this year? And is there anything behind that? And then I have one quick follow-up. Thanks.

Some of the of the access investments that we've made and then also a bit on the patient mix side, but with the heavier skewed towards the towards.

Towards Medicaid.

You know where I would guide for the rest of the year is similar to what I've said in the past.

But you should expect our net price to be around 5400 of $5500 per Trs.

Matthew C. Abernethy: Yeah, hey, Paul, nice to hear from you. Yeah, we did not see the step back up.

Okay, Great and then I just wanted to ask quickly if you could comment on business development. You know of few of the transactions you've done have had some setbacks, which obviously is the norm for neuro.

Matthew C. Abernethy: Like you have seen in previous years, from a net price perspective, you did see some step up, however, as we walked out of the donut hole exposure that we typically walk through in Q1. What I'd say is that the elevated growth net is something that you would likely see stick with us for some period of time. And that really reflects some of the access investments that we've made, and then also a bit on the patient mix side with the heavier skew towards Medicaid. You know, where I would guide for the rest of the year is similar to what I've said in the past, that you should expect our net price to be around $5,400 to $5,500 per TRF.

But I guess in the context of that what's sort of your appetite for taking on risks going forward and where do you see kind of the the best opportunity or need debt to backfill of your pipeline. Thanks.

Thanks, Paul Kyle go ahead.

Yes. Thanks for the question Paul Yes, So I think what you've heard Pierre here with you on the call. This afternoon is that our first priority and looking at the pipeline as the support than the needs of the growth of both commercially and then also from the pipeline perspective with the the new indications that we're looking at developing into the all of that it is looking at.

Building up the pipeline that's going to come from.

Internally driven research programs that go into the clinic as well as being active business development wise.

Kyle Gano: Okay, great. And then I just wanted to ask quickly if you could comment on business development. You know, a few of the transactions you've done have had some setbacks, which obviously is the norm for neuro. But I guess in the context of that, what's your appetite for taking on risk going forward? And where do you see the kind of best opportunity or need to backfill your pipeline? Thanks. Thanks, Paul. Kyle, go ahead.

And we continue to be active there, although you havent seen the deals.

Recently, we continue to review of lot of different types of programs the technologies.

That might play on our interest in neurology and neuropsychiatry neuroendocrinology.

And in terms of what we're looking for is primarily in mid to late stage assets I know, it's an area that most companies are looking to fill but we see opportunities in that space.

The may help us in the near term as we look to add things and be aware of that are.

With the risk in neurology and psychiatry, we wanted we always would like to have programs to augment overtime. So here's what we look at adding to the pipeline as the.

Kyle Gano: Yeah, thanks for the question, Paul. Yeah, so I think what you heard on the call this afternoon is that our first priority in looking at the pipeline is to support the needs of Ingressa both commercially and then also from the pipeline perspective with the new indications that we're looking at developing into. Beyond that, it is looking at building up a pipeline that's going to come from internally driven research programs to go into the clinic as well as being active in business development.

The programs mature and see what those cars look like as they are turned over in the coming years. So the.

The take home is the we again looked at sort of driving for programs. We're searching for programs that have this innovative science of Pep.

Platform technologies as you've seen in our epilepsy franchise the scene on the Doris yet to help us look at programs that have the opportunity for multiple disease states for development.

And the only thing I would add is that obviously, Kyle and his team look for very strong intellectual property position. So the we can whatever we bring in just as with our internal programs, we're going to be able to invest in that over the years.

Kyle Gano: And to that end, we continue to be active there. Although you haven't seen any deals recently, we continue to review a lot of different types of programs and technologies that might fit our interest in neurology, neuropsychiatry, and neuroendocrinology. And in terms of what we're looking for, it's primarily mid to late stage assets. I know it's an area that most companies are looking to fill, but we see opportunities in that space that may help us in the near term as we look to add things and be aware that with the risks in neurology and psychiatry, we always would like to have programs to augment over time.

And well move next to Brian Abrams with RBC capital markets. Please go ahead.

Thanks, Thanks for taking my question and congrats on the quarter.

The interesting to hear about the new indications you're pursuing for bell benzene. So I was wondering if you could maybe speak a little bit more about the mechanistic rationale there.

And any of the the.

David the guided your decision and is there any I guess formalized data collection of investigator study small investigator studies in those settings.

Be curious to hear about any additional IP protection with those additional that those additional indications may confer for Ah Congrats and thanks.

I agree.

Yeah, Thanks, Brian Wells the mechanism really as we speak to be mapped to inhibition I think we've always been interested in that mechanism in the context of both obviously this kinetic cerebral palsy as a movement disorder somewhat akin to tardive dyskinesia in other movement disorders.

Kyle Gano: So here's where we look at adding to the pipeline as these programs mature and see what those cards look like as they are turned over in the coming years. So the take home message is that we again look at driving for programs or searching for programs that have innovative science platform technologies, as we've seen in our epilepsy franchise with Venon and Adoresia, to help us look at programs that have the opportunity for multiple disease states for development.

Then in the context of the a T S program of junk to treatment of schizophrenia.

The mechanism of lends itself well to Bob in terms of being potentially Odyssey of an effect to currently use the dopaminergic.

Kyle Gano: And the only thing I would add is that obviously Kyle and his team look for very strong intellectual property positions so that whatever we bring in, just as with our internal programs, we're going to be able to invest in it over a year. And we'll move next to Brian Abrams with RBC Capital Markets.

<unk> therapies and in addition to that I would say that we're also obviously encouraged by the extensive safety database that we have for the use of both benzene and price are in tardive dyskinesia and beyond that you know, we we haven't talked directly about data that we have in hand or particular stuff.

Brian Abrahams: Thanks. Thanks for taking my question and congrats on the quarter.

Brian Abrahams: Thank you for taking my question and congratulations on the quarter. I was interested to hear about the new indications you're pursuing for Velbenazine. So I was wondering if you could maybe speak a little bit more about the mechanistic rationale there and any of the data that guided your decision. Is there any, I guess, formalized data collection or investigator studies, small investigator studies in those settings? I'd be curious to hear about and any additional IP protection with those additional indications that those additional indications may confer on Ingressa. Thanks. [inaudible] Yeah, thanks, Brian.

He said, we are actually moving into registration phase studies and the reason for that is that.

We know that smaller studies in schizophrenia can lead to you know signals that are difficult to interpret them. So we clearly wanted to test this hypothesis fully and that's the reason for going into the Registrational program at this point in time.

Brian I will say that we have at this point about 19 Orange book patents listed so I think from the intellectual property position.

We are appropriately covered.

Eiry W. Roberts: Well, the mechanism really, as we speak of VMAT-2 inhibition, I think we've always been interested in that mechanism in the context of both, obviously, dyskinetic cerebral palsy as a movement disorder, somewhat akin to tardive dyskinesia and other movement disorders. And then, in the context of the ATS program, adjunct to treatment of schizophrenia, the mechanism lends itself well to that in terms of the mechanism being potentially additive in effect to currently used antidopaminergic therapies.

And we'll take our next question from Brian <unk> with Baird. Please go ahead.

Hey, good afternoon guys.

That's on a nice quarter.

Yes.

Kind of jump off of Brian's question, a little bit too and just I understand you don't want to really disclose sort of what youre evaluating here in either of these indications of co are the clinical trials are our poster, but I guess just from that kind of think of.

On the commercial experience, where they can graduate I would think that a lot of congratulations of our schizophrenics to begin with a lot of it so attractive we might have a lot of commercial experience with what is key.

Kind of technically be considering the adjunctive therapy.

<unk> therapy anyway. So I'm just wondering if you kind of discuss at all in the commercial experience of what you're hearing from providers patients in terms of cash.

Eiry W. Roberts: And in addition to that, I would say that we're also obviously encouraged by the extensive safety database that we have for the use of valbenazine ingress in tardive dyskinesia. But beyond that, you know, we haven't talked directly about data that we have in hand or particular studies, and we are actually moving into registration phase studies. And the reason for that is that we know that smaller studies in schizophrenia can lead to, you know, signals that are difficult to interpret.

Any additional benefits beyond the sort of just the the.

The dyskinesia benefits that you say that that might be applied.

The powering and designing the study in and I guess it was.

Could you characterize that as sort of a benefit on negative symptoms.

Seem like maybe.

Anti does come out of drug would have a hard time getting over some of the positive some come from certainly maybe you havent see of rebound and socialization of for patients who aren't.

Eiry W. Roberts: And so we clearly want to test this hypothesis fully. And that's the reason for going into this registrational program at this point in time. Brian, I will say that we have at this point about 19 Orange Book patents listed. So I think from an intellectual property point of view, we're appropriately covered.

Exhibiting movement disorder, so any of any sort of comment on the commercial experience and how that kind of leads to us to a schizophrenia indication.

Yeah, you know the it is it is 1 where you get anecdotal feedback, but anecdotal feedback is just that it's anecdotal feedback.

I I really think what what drives our decision to go into these indications is more from the mechanistic aspect of.

Eiry W. Roberts: And we'll take our next question from Brian Skorney.

Of this and as and as IRA said.

That we have embarked on phase III studies here, because we wanted to get a clear cut unambiguous the answer.

Brian P. Skorney: Next, we have a question from Brian Skorney with Baird. Please go ahead. Hey, good afternoon, guys, and congrats on a nice quarter.

Of the these as we explore both of these indications.

You know, we've we've learned our lesson interrupt if you will that anecdotal information or small clinical studies that have been done at single sites of things like that can really lead you. So do.

Brian P. Skorney: I guess I'm going to kind of jump off of Brian's question a little bit, too. And I understand you don't want to really disclose sort of what you're evaluating here in either of these indications until the clinical trials are posted. Unknown Speaker It could kind of technically be considered an adjunctive test therapy. Anyway, so I'm just wondering if you kind of discuss at all in the commercial experience what you're hearing from providers and patients in terms of any additional benefits beyond sort of just the dyskinesia benefits that you see that might be applied to powering and designing a study and you know, I guess it would, you know, could you characterize that as sort of a benefit on negative symptoms?

The good well thought out clinical studies.

To give you that unambiguous answer as you explore new indications to go into in the salary said the the mechanistic underpinnings of going into these 2 is very good and so that that truly is what drives us in their IRA do you want to add any more to that.

So I think you I think he said it very well, Kevin and maybe the only thing I'd add is that obviously 1 of the other reasons were doing smaller phase 2 studies is in the face of needing to generate safety and Tolerability information and Brian to your point I mean, I think there is the a lot of Tolerability and safety data that we have.

Already have in schizophrenic individuals and so that gives us the level of confidence in being able to go into those well designed well powered phase III programs.

Brian P. Skorney: You know, it seemed like maybe an anti-dyskinetic drug would have a hard time getting over some of the positive symptoms, but certainly, maybe you see a rebound and socialization for patients who are exhibiting movement disorder. So any sort of comment on the commercial experience and how that kind of reads to us as a schizophrenia indication. Yeah, you know that it is one where you get anecdotal feedback, but anecdotal feedback is just that. It's just anecdotal.

Yeah.

And we'll take our next question from Jay Olson with Oppenheimer. Please go ahead.

Oh, hi, yeah, thanks for taking the questions and maybe to continue on the theme of the new indications.

Could you maybe just comment on any potential.

Potential spontaneous non promoted use you might be seeing in those new and there's new indications and since you are going to be initiating a registrational trials.

Kevin C. Gorman: I really think what drives our decision to go into these indications is more the mechanistic aspect of this. And as Eiry said, we have embarked on phase three studies here because we want to get a clear cut on ambiguous answer to these as we explore both of these indications. You know, we've learned our lesson in Tourette, if you will, that anecdotal information or small clinical studies that have been done at single sites or things like that can really mislead you.

Could you maybe talk about the timeline that you would expect too.

Potentially submit regulatory filings for those new indications. Thank you.

Yeah on the on the second half of that Chad. It it's too early to say what the what the timelines are going to be as always we say, let us get into the studies, let's get enrollment going as low as we have a good uptake in enrollment then we can give you an intelligent answer about exactly what the timelines are going to look like for the so stay tuned.

Kevin C. Gorman: So do good, well thought-out clinical studies to give you that unambiguous answer as you explore new indications to go into. And as Irie said, the mechanistic underpinnings of going into these two are very good. And so that truly is what draws us in there. Irie, do you want to add any more to that? So I think you said it very well, Kevin, and maybe the only thing I'd add is that obviously one of the other reasons for doing smaller phase two studies is in the face of needing to generate safety or tolerability information.

For that.

And again when.

We do not promote to anything other than tardive dyskinesia, we don't support than any other in any manner in this company.

The use of in gross in anything other than adults with tardive dyskinesia. So.

You know again I would reiterate that.

The anecdotal data is only anecdotal data and we don't put a whole lot on that at all.

Kevin C. Gorman: And Brian, to your point, I think there is a lot of tolerability and safety data that we already have in schizophrenic individuals. And so that gives us a level of confidence in being able to go into those well-designed, well-powered phase three programs. And we'll take our next question from Jay Olson with Oppenheimer. Please go ahead.

So again I just reiterate that mechanistically.

The V not 2 mechanism.

Looks likely to be involved in these disease states and so that's why we're going to explore the use of congrats of them.

And we'll take our next question from Nina the treat til cards with Citi. Please go ahead.

Jay Olson: Oh hi, yeah, thanks for taking the questions and maybe to continue on the theme of the new indications, could you maybe just comment on

Hey, guys. Thanks for taking my question and congrats on the on the earning.

Jay Olson: potential spontaneous non-promoted use that you might be seeing in those new indications. And since you are going to be initiating registrational trials, could you maybe talk about the timeline that you would expect to potentially

So I'm just following again kind of on this line of questioning around the new indications I guess kind of to Brian's earlier question around schizophrenia, just given that a lot of patients.

Who are on a growth of today you know may already have skipped the finance can you just help us kind of walk us through how we should think about kind of the differentiated kind of commercial potential as an adjunct therapy in schizophrenia vs.

Jay Olson: potentially submit regulatory filings for those new indications. Thank you.

Kevin C. Gorman: Yeah, on the second half of that, it's too early to say what the timelines are going to be. As always, we say, let us get into the studies. Let's get enrollment going as well as we have a good uptake in enrollment, then we can give you an intelligent answer about exactly what the timelines are going to look like for these. So stay tuned for that. And again, when we do not promote anything other than Tardive Dyskinesia, we don't support, in any other way, in any manner, in this company, the use of Ingress in anything other than adults with Tardive Dyskinesia.

The current kind of dyskinesia indication.

Well as far as.

Differentiation again, where we're getting a bit ahead of ourselves. We just now are talking about embarking on the study into the.

The adjunct of treatment of schizophrenia.

And so.

It is known and well know that patience schizophrenic patients cycle through a number of different anti psychotics and so it's clear that you need more choice you need more different mechanisms of anti psychotics from all work postsynaptic Lee in order to inhibit dopamine signaling.

Kevin C. Gorman: So, you know, again, I would reiterate that anecdotal data is only anecdotal data, and we don't put a whole lot on that at all. So again, I just reiterate that mechanistically, the VMAT2 mechanism looks likely to be involved in these disease states. And so that's why we're going to explore the use of Ingress in

And as you know in grocer is working presynaptic Lee in order to decrease.

The amount of dopamine that's available in.

In the synapse.

Neena Bitritto: And we'll take our next question from Neena Bitritto Garg with Citi. Please go ahead. Hey guys, thanks for taking my question and congrats on the. So just following, again, kind of on this line of questioning around the new indications, I guess kind of to Brian's earlier question around schizophrenia, just given that a lot of patients who are on Ingressa today may already have schizophrenia. Can you just help us kind of walk us through how we should think about the differentiated kind of commercial potential as an adjunctive therapy in schizophrenia versus the Thank you.

And so that's what that's what we're going for here as far as how will that translate into a differentiated product.

Need the data.

In order to be able to say exactly how that would how that would differentiate the is completely different safety and tolerability profiles between anti psychotics in grocer for 1 I don't know.

Eric and I really would want to add anything more.

Well I would just make a couple of comments Kevin I think the first thing is that they're obviously currently no approved adjunctive treatment for schizophrenia, and so the unmet need there is very significant also to your point the a significant proportion of patients suffering from schizophrenia and living.

Kevin C. Gorman: Well, as far as differentiation is concerned, again, we're getting a bit ahead of ourselves. We just now are talking about embarking on a study into the adjunctive treatment of schizophrenia. And as you know, Ingresa works presynaptically in order to decrease the amount of dopamine that's available in the synapse. And so that's what we are going for here. As far as how will that translate into a differentiated product, you need the data in order to be able to say exactly how that would differentiate.

Schizophrenia do not get a full of response in terms of the.

Psychosis symptoms to currently available treatments and so with that in mind and given the mechanistic rationale that Kevin described then articulated that's why I think we were very keen to be able to test this hypothesis and going to a registrational study.

And we'll take our next question is from our new Palm Rama with J P. Morgan. Please go ahead.

Kevin C. Gorman: There are completely different safety and tolerability profiles between antipsychotics and Ingresa, for one. I don't know if Eric and Irie would want to add anything more. Well, I would just make a couple of comments, Kevin.

Hey, guys. Thanks for taking the question and congrats on the quarter.

Matt on the call there were a lot of you know are the ones who called there were a lot of moving parts can you kind of gave us some directional guidance with 1 of your you know a range of where you thought and grabbed the was going to land and where you were comfortable and again, where we have a lot of moving parts here with.

Eiry W. Roberts: I think the first thing is that there are currently no approved adjunctive treatments for schizophrenia, and so the unmet need there is very significant. Also, to your point, a significant proportion of patients suffering from schizophrenia and living with schizophrenia do not get a full response in terms of their psychosis symptoms to currently available treatment. And so with that in mind, and given the mechanistic rationale that Kevin described and articulated, that's why I think we were very keen to be able to test this hypothesis and go into a registrational study.

You know our scripts inflicting here a little bit and then.

All set by some you know 3 Q seasonality and Delta variant. So any possibility you might be comfortable with giving us a little bit more directional guidance on how youre thinking about <unk> and <unk>.

All of that just from Keith to keep numbers going wild or anything like that thanks. So much.

Yeah, Yeah, no happy to shed some color and we tried to be pretty specific in our prepared remarks today and what we would expect we did see nice momentum exiting Q2, and Thats actually continued through most of July thus far. So we're we're very encouraged by what we've seen thus far.

Anupam Rama: And we'll take our next question from Anupam Rama with J.P. Morgan. Please go ahead.

Anupam Rama: Hey guys, thanks for taking the question and congrats on the quarter. Matt, on the 2Q call, there were a lot of, you know, on the 1Q call, there were a lot of moving parts, and you kind of gave us some directional guidance with when you, you know, a range of where you thought Ingresa was going to land and where you were comfortable. And again, we have a lot of moving parts here with, you know, Scripps inflecting here a little bit and then offset by some, you know, 3Q seasonality and Delta variant.

But we also acknowledge the Delta variant has stepped up over the last several weeks and that's starting to limit access.

In certain regions around the country. So when we look at our numbers based upon what we have been in Q and then look back over over history. How has <unk> of performed in 2018.2019 sequentially, where that puts us is around a 15 million dollar sequential increase.

Thats what were.

Anticipating somewhere around there for for Q3, and so with all the moving parts on impulse like you said.

Anupam Rama: So any possibility you might be comfortable with giving us a little bit more directional guidance on how you're thinking about 3Q and, you know, just to keep numbers going wild or anything like that? Thanks so much. Yeah, yeah, no, happy to shed some color.

That's why we've chosen to give a bit more specific guide to.

To the coming quarter, just like we did in Q1 regarding Q2 and the Q2 regarding Q3.

Matthew C. Abernethy: And we tried to be pretty specific in our prepared remarks today. And as to what we would expect, we did see nice momentum exiting Q2, and that's actually continued through most of July thus far. So we're very encouraged by what we've seen thus far. But we also acknowledge the Delta variant has stepped up over the last several weeks, and that's starting to limit access in certain regions around the country.

But for me personally I was quite encouraged to see the step up in growth in Q2 just.

Just the promotional responsiveness of our of our sales force going out engaging with customers and seeing the the response on the indirect side I think it really helps paint the picture and confirm that Theres a significant opportunity ahead of us for developing the TD market and helping many more patients.

Got it thanks, so much.

And we'll take our next question from David.

Matthew C. Abernethy: So when we look at our numbers based upon what we have in queue and then look back over history, how has Ingressa performed in 2018, 2019, sequentially, where that puts us is around a $15 million sequential increase is what we're anticipating somewhere around there for Q3. And so with all the moving parts, Anupam, like you said, that's why we've chosen to give a bit more specific guidance for the coming quarter, just like we did in Q1, regarding Q2, and then in Q2, regarding Q3.

And some of them with Piper Sandler. Please go ahead.

Yes.

Hey, thanks.

So I just wanted to switch gears and ask about your thoughts on the exclusivity runway for and grass you recently initiated litigation against I believe it's 4 Anda filers.

And wanted to get your thought process on.

Initiating litigation in Delaware and also in 1 case in New Jersey, if there's anything to read into there and then secondly, you can talk about.

Any patent term restoration of extensions that we should be aware of what's coming down the pike and just in general how you're thinking of that overall exclusivity by the way. Thank you.

Matthew C. Abernethy: But for me, personally, I was quite encouraged to see the step-up in growth in Q2, just the promotional responsiveness of our sales force going out and engaging with customers and seeing the response on the NRX side. I think it really helps paint the picture and confirm that there's a significant opportunity ahead of us for developing the TD market and helping many more patients. Thanks so much. And we'll take our next question from the audience.

Yeah. Thanks for that we we are of very strong patent position, we feel very confident in it the.

These days, having generic manufacturers.

File and is is just a normal course of business and then our defending those is also a normal course of business since I settled at the earlier.

We have 19 patents in the Orange book and so we have a very long runway of.

David A. Amsellem: Question from David Amsalom with Piper Sandler: please go ahead.

The exclusivity that we're confident in with the.

With <unk> and some of these patents can can even extend that runway well into the future we are.

David A. Amsellem: Hey, thanks. So I just want

David A. Amsellem: I wanted to ask about your thoughts on the exclusivity runway for Ingressa. You recently initiated litigation against, I believe it's four and defilers, and I wanted to get your thought process on initiating litigation in Delaware and also in one case in New Jersey, if there's anything to read into there. And then secondly, can you talk about any patent term restoration or extension that we should be aware of that's coming down the pike and, just in general, how you're thinking about the overall exclusivity runway. Thank you.

We are not going to comment in any more detail because it is ongoing litigation, but it is just the normal course of business and pharmaceuticals. These days.

Let's take the next question Laura.

Well move next to Chris Shaw The County with Goldman Sachs. Please go ahead.

Great. Thank you for the question.

During the last quarter, you announced your plans to invest in your.

The direct to consumer DTC campaigns can you talk about what your <unk>.

Metrics are for determining what kind of.

Effectiveness, that's having and if we were to think about kind of the arc of how long you are going to sustain that level of investment how should we think about it particularly as we look at 2022.

Kevin C. Gorman: Yeah, thanks for that. We have a very strong patent position, and we feel very confident in it. These days, having generic manufacturers file and as is just a normal course of business, and then defending those patents is also a normal course of business. As I said a little earlier, we have 19 patents in the orange book. And so we have a very long runway of exclusivity that we're confident in with Ingressa.

Eric why don't you take that.

Yes happy to and thank the thanks for the question so.

It's early days, yet you may recall that the.

The branded DTC campaign, which we call spotlight TD spotlight was.

Launched effectively are in mid may so about halfway through the quarter.

And thus far we're very pleased with.

What we're seeing in terms of the leading indicators.

For example, we look at things like traffic to the website, especially.

Kevin C. Gorman: And some of these patents can, can even extend that runway well into the future. We We are not going to comment in any more detail because it is ongoing litigation, but it is just the normal course of business in pharmaceuticals these days.

Immediately after the AD has run.

We look at the number of page views are we look at the amount of time the visitors are spending on the website.

Loading content registering to receive information and so on and all of those indicators are in line with or perhaps in some cases better than what we expected.

Operator: Let's take the next question, please.

Chris Shibutani: Absolutely. We'll move next to Chris Shubitani with Goldman Sachs. Please go ahead.

Chris Shibutani: Great, thank you for the question. During the last quarter, you announced your plans to invest in your direct-to-consumer DTC campaigns. Can you talk about what your metrics are for determining what kind of effectiveness that's having? And if we were to think about kind of the arc of how long you're going to sustain that level of investment? How should we think about it, particularly as we look at 2022? Eric, why don't you take that?

Certainly we have high expectations for the for this campaign is based upon the way that it tested so we feel very good about.

The direction that we're heading we intend to continue to invest in DTC.

Certainly we have said in the past debt.

As a disease area, where the vast majority of our patients that suffer from TD are yet to be of diagnose 8 out of 10 people with TD haven't received the diagnosis haven't received an explanation for the abnormal movements and the certainly we feel like this ad campaign.

Eric S. Benevich: Yeah, happy to. And thanks for the question. So it's early days yet. You may recall that the branded DTC campaign, which we call Spotlight, TD Spotlight, was launched effectively in mid-May, so about halfway through the quarter. And thus far, we're very pleased with what we're seeing in terms of the leading indicators. So, you know, for example, we look at things like traffic to the website, especially immediately after the ad has run. We look at the number of page views. We look at the amount of time that visitors are spending on the website, downloading content, registering to receive information, and so on.

The bulk educate people about TD.

And the fact that there is an approved treatment option with the president.

So we would expect debt as we progressed through the year and get towards the end of 'twenty, 2 and more importantly.

More pronounced in.

Next year in 2022 that will start to see of more tangible benefit from from the AD campaign in terms of patients having seen the add of number of times.

And been activated and motivated to talk to their provider ask about TV and asked specifically for <unk>. So we'll.

Eric S. Benevich: And all of those indicators are in line with, or perhaps, in some cases, better than what we expected. And certainly, we had high expectations for this campaign based on the way that it tested. So, we feel very good about the direction that we're heading in. We intend to continue to invest in DTC. Certainly, we have said in the past that, you know, this is a disease area where the vast majority of patients that suffer from TD are yet to be diagnosed. You know, 8 out of 10 people with TD haven't received a diagnosis, and haven't received an explanation for their abnormal movements.

We will continue to.

To invest in DTC, because we think that it's going to benefit patients and it's going to benefit our hiring for the franchise.

And this is Matt I'll just chime in on the question as to the investment as of as we look into 2022.

Given where the development of the market isn't that as Eric alluded to 8 out of the plan not being diagnosed at this point you would expect if we see success through the first half of next year. It would be something that we would likely be continuing for the foreseeable future.

Eric S. Benevich: And certainly, you know, we feel like this ad campaign both educates people about TD and the fact that there's an improved treatment option within CRESA. So, we would expect that as we progress through the year and get towards the end of 2022, and more importantly, more pronounced next year in 2022, we'll start to see a more tangible benefit from the ad campaign in terms of patients having seen the ad a number of times and being activated and motivated to talk to their provider, ask about TD, and ask specifically for Ingresa. So we'll continue to invest in DTC because we think that it's gonna benefit patients and it's gonna benefit our Ingresa franchise. And this is Matt.

But we will keep you apprised in and we're looking forward to seeing the ultimate results are showing up in our sales performance later this year and more fully into our 2022.

Yeah.

And we'll take our next question from Charles Duncan with Cantor Fitzgerald. Please go ahead.

Okay. Thank you hi, Kevin and team congrats on a good quarter.

Had a pipeline question, but it has 2 parts and I wanted to start the first part is relative to the.

The candidate loop of the Axis Stat that you are looking at for starting a CIA study in the second half the the year I'm wondering if you could provide a little more color.

Matthew C. Abernethy: I'll just chime in on the question as to the investment as we look into 2022. Given where the development of the market is at, as Eric alluded to, eight out of 10 not being diagnosed at this point, you would expect if we see success through the first half of next year, it'd be something that we would likely be continuing for the foreseeable future. But we'll keep you apprised, and we're looking forward to seeing those ultimate results show up in our sales performance later this year and more fully into 2022.

On the mechanistic rationale is especially relative to say for a positive allosteric modulation and and that's part 1 of part 2 is actually going back to Val benzene no one's asked about Huntington's chorea and I guess I'm wondering given the challenges in Huntington.

This year, how do you feel about patient heterogeneity and could of win in that study.

And S N D E filing next year.

So I'll, let Irene and then the Kyle if you have any sort of their comments on the questions by chess.

Matthew C. Abernethy: And we'll take our next question from Charles Duncan with Cantor Fitzgerald. Please go ahead. Okay, thank you. Hi Kevin and team, congrats on a good quarter. I had a pipeline question, but it has two parts.

Yeah, absolutely. So thanks for that firstly on the loop of DOCSIS that question I mean, I think the mechanistic rationale supporting the potential for loop of DOCSIS thought as the D. A <unk> inhibitor and treating the cognitive impairment associated with schizophrenia.

Charles Duncan: And I wanted to start. The first part is relative to the candidate lupid axis stat that you are looking at for starting CIAS studies in the second half of the year. I'm wondering if you could provide a little more color on the mechanistic rationale, especially relative to, say, M4 positive allosteric modulation.

He is actually pretty strong.

It actually goes back to the the preclinical data also to the biological mechanism of.

Charles Duncan: And that's part one. Part two is actually going back to valbenazine. No one's been asked about Huntington, Korea.

Of the schizophrenia itself on the the.

Israel neuro.

The developmental issues that are associated with schizophrenia and so in addition to that I mean, we saw in all of our phase.

Charles Duncan: And I guess I'm wondering, given the challenges in Huntington this year, how do you feel about patient heterogeneity? And could a win in that study enable an SNDA filing next year? So I'll let Eiry and then Kyle know if they have any further comments on the questions by Chow. Yeah, absolutely. So thanks for that.

Phase 2 interact steady although it was not the primary endpoints of the study we saw a pretty impressive signal against both the cognitive assessments on the functional assessment of the impact of cognition in schizophrenia, and so with all of that rationale in hand.

Eiry W. Roberts: Firstly, on the Luvodaxosat question, I mean, I think the mechanistic rationale supporting the potential for Luvodaxosat as a DAO inhibitor in treating the cognitive impairment associated with And that study is currently in the final stages of being prepared and designed, and we're on track to start that phase two study by the end of this year. And so in that regard, that's what I'd say about Obviously, there are other potential mechanisms, including muscarinic mechanisms, that may be valuable in treating the negative symptoms or cognitive factors that are part of schizophrenia.

We actually were very keen to test that hypothesis fully in a well powered and well designed phase II study and that study is currently in the final stages of being a prep and designed and we're on track to start the phase II study by the end of the year.

And so I think in that regard that's what I'd say about low the DOCSIS data, obviously that are of the potential mechanisms, including muscarinic mechanisms that may be valuable in treating the negative symptoms all of cognitive practice better are caught in schizophrenia of it but I just wanted to share with you the.

Eiry W. Roberts: But I just wanted to share with you the rationale that we believe quite strongly supports the potential role of Luvodaxosat in treating those symptoms. With respect to HD, you know, actually, I think in the course of our trial, we made several changes to accommodate the challenges associated with the COVID pandemic. And so we were actually very confident in those changes that were made to support more of a telemedicine-type environment for assessments in that program.

The rationale that we believe quite strongly supports the the potential relative to the doctor the start and end in treating those symptoms.

With respect to H D.

You know actually I think we are in the course of the trial, we actually made several changes to accommodate the challenges associated with the Covid.

Covid pandemic and so are we actually were very confident in those changes that were made to support more and more of a telemedicine type of environment for assessments in that program and we actually have a very extensive dataset the generate in the context of the H D connect program and.

Eiry W. Roberts: We actually have a very extensive data set that is generated in the context of the HD Connect program. And, you know, we were very pleased with the completion of enrollment in that study and, obviously, on track to deliver data by the end of the year. Kyle, I don't know if you have anything to add there. If you cover the majority of the lupidoxystat, I would just add that there is some interesting work going on in the field now on compounds, molecules that potentiate an MVA pathway, and their relevance in the negative symptoms.

Very pleased with the completion of enrollment of that study and obviously on track to deliver data by the end of the year.

Yeah.

Kyle I don't know if you had anything to add the.

If you can cover the majority of the the DOCSIS debt I would just add that there is some interesting work going on in the field now on compounds molecules that potentially the NDA pathway and the relevance of the negative symptoms and expects to have the compounds like ours here the small behaved in that we understand the things like target engage.

<unk> and occupancy.

So we're really just drilling into the mechanism of disease state as a next step for the phase 2 trial that we're envisioning.

Okay.

And 1 of them next to the amount of Vaughan with Mizuho. Please go ahead.

Eiry W. Roberts: And it's nice to have a compound like ours here that's well-behaved and that we understand things like target engagement and occupancy. So we're really just drilling into the mechanism of the disease state as a next step for the phase two trial that we're envisioning. And we'll move next to Vimil Devon with Mizuho. Please go ahead.

Great. Thanks for taking my question.

So maybe just following up on some of the questions earlier on the new indications of El benzene and also the question on business development. So it feels like there's maybe a little bit of a shift.

And the number of external deals in the past year or 2 and now maybe investing a little more on the vendors of line extensions have leaned out of the.

Pipeline and the product beyond just TD and in HDD. So I'm wondering if that is an excellent cash flow shift.

Vimil Devon: Great, thanks for taking my question. Maybe I'll just follow up on some of the questions earlier on the new

And if so why of why it is.

Vimil Devon: Q&A Q&A Q&A Q&A

The stern divisions now as opposed to the previously or what maybe later in the future or maybe to the signal in any way sort of less attractive external opportunities some of what you've been looking at the low D day perspective, so any further insight there would be helpful. Thanks.

Vimil Devon: or maybe later in the future, or maybe just a signal, in any way, to become less attractive.

Kevin C. Gorman: [inaudible] Yeah, no, Vamil, I appreciate the question. But no, there isn't, there's not been any shift at all. I would say that our use of capital remains the very same, and it has for quite some time now; the next best dollar we always said could be spent on, in Gresen, the VMAT-2 mechanism. So that's what you see us doing here. We also invest in our internal resources and internal research. And then we also invest in looking externally. The goal here is to build a world class pipeline. And I believe that's exactly what we're doing here using internal and external resources. Kyle, do you want to add some more to that?

None of the mill appreciate the question, but no there isn't there there's not been any shift at all I would say that our our use of capital remains of the very same in the house for quite some time now the next best dollar we always said could be.

On and grandson of the beam at 2 mechanism. So that's what you see us doing here.

We also invest in.

In our internal resources internal research and then we also invest in looking externally. The the the goal here is to build a world class pipeline and I believe that's exactly what we're doing here using internal and external.

Resources.

Kyle do you want to add some more to that.

Kyle Gano: Yeah, there was a good question about our BD interest previously, and I just wanted to clarify and touch on some of the points that Kevin mentioned. Firstly, as it relates to balbenazine, in terms of our interest in disease states, we've always had a longer vision of where the program could go over time. It was a functioning, more or less, of sequencing to see how we could get things to roll out, first with disease states that had good data to support those initially, and then move into these disease states that may require additional work.

Yeah. There was a good question about SAR BD interest previously and just wanted to clarify and touch on some of the points that Kevin mentioned.

First day as it relates to bell benzene in terms of our interest in disease States. We've always had a longer vision of where the program could go over time. It was a function of any more or less of sequencing and see how we could get things to rollout.

First with disease states that.

Good day.

Data to support those initially and then move into these disease states that.

May require additional work in that sort of led us to D. C. P. R.

Kyle Gano: And that's what led us to DCP and the ATS programs. And in terms of business development and our interest there, I think everything complements exactly what we're trying to do across the areas of neurology, psychiatry, and endocrinology. And if you look at our efforts in the past couple of years, it's building out neurology to support the interest there. That's what led us to epilepsy and some of the programs there in precision medicine.

The Ats programs and in terms of business development of our interests. There I think everything complements exactly what we're trying to do across the areas of neurology psychiatry and the endocrinology.

And if you look at our efforts of the past couple of years is building out neurology to support the interest there of movement disorders of the Grubhub, that's what led us to epilepsy and some of the programs they're in precision medicine, and then pivoting to our interest in psychiatry, you see our collaboration with Takeda and you'd be able to offer.

Kyle Gano: And then pivoting to our interest in psychiatry, UCR's collaboration with Takeda may be able to augment our portfolio there. So I think you'll see much the same moving forward, looking at programs that bring in innovative science, technology, and work that's been done by other companies that we can leverage with our team here and our capabilities and resources.

Augments our portfolio of there so I think you'll see much the same moving forward looking at programs that bring in the innovative science.

Technology and work that's been done by other companies that we can leverage with our team here and our cash.

The Bill is in resources.

Josh Schimmer: And we'll move next to Josh Schimmer with Evercore. Please go ahead.

Yeah.

And then the next to Josh Shimmer with Evercore. Please go ahead.

Josh Schimmer: Thanks for taking the question. As you think about moving into adjunct treatment,

Thanks for taking the question as you think about moving into the adjunct.

Josh Schimmer: Thank you for your approach to schizophrenia with Ingressa. How are you thinking about reconciling the likely price point for an antipsychotic compared to the current application of Tardive Dyskinesia? Would that be under a separate brand or a separate kind of formulation?

Treatment.

[noise] approach for schizophrenia.

<unk> growth how are you thinking about reconciling the the likely price point for an antipsychotic compared to the current application of tardive dyskinesia, what that would be under a separate brand or a separate kind of formulation.

Kevin C. Gorman: How are you thinking about managing that? Thank you. Yeah, Josh, what I would say again is that we are just exploring these two new indications for valbenazine, and so it's too early and it's too premature to be able to talk about things such as differentiation, what ultimate clinical benefit is going to be there, and therefore what pricing would look like in any of these indications. So I would, let's hold that question, let's keep that there until we're much farther along in the actual exploration of these.

How are you thinking about managing that thank you.

Yeah Josh.

Again, what I would say is is that.

We are just exploring these 2 new indications for Val benzene and so it's a it's too early and it's too premature to be able to talk about things such as differentiation.

What ultimate clinical benefit is going to be there and therefore what pricing.

It would look like in any of these indications so I would lets hold that question, let's keep that there.

Until we're much farther along and actually the exploration of these it is something that we have a very large and diverse pipeline here that covers north.

Kevin C. Gorman: It is something that, you know, we have a very large and diverse pipeline here that covers neuroscience, neuroendocrinology, and neuropsychiatry. We go into indications led by science and also led by unmet medical need. And so you see us taking multiple shots at the schizophrenic population because we feel that they are completely underserved there.

Neuroscience Neuroendocrinology and neuropsychiatry.

We go into indications.

Led by the science and also led by unmet medical need and so you'll see us in most of the taking multiple shots in the schizophrenic population because we feel that they are completely underserved. There. So it is a it is our intent to try to serve patients and then we will as we see what we are bringing to the patient.

Kevin C. Gorman: So it is our intent to try to serve patients and then, as we see what we are bringing to the patients, the value of the medicine, and we'll make other decisions based on that. And we'll take our next question from Miles Minter with William Blair. Please go ahead. Hey guys, congrats on the quarter. I don't think anyone's asked about Gentes yet. So maybe I will.

The value of the medicine and will make other decisions based on that.

And we'll take our next question from Myles Minter with William Blair. Please go ahead.

Hi, guys. Congrats on the quarter I don't think anyone that's off the bat on Genesis, yet sorry, maybe I'll well you mentioned that there was sort of a pickup in interest during the quarter wondering if he can get a little bit more granular on the metrics that make you think that and Oh, sorry, with the hauling best in the in Tele medicine.

Myles Minter: You mentioned that there was sort of a pickup in interest during the quarter. I'm wondering if you can get a little bit more granular on the metrics that make you think that. And also, with the whole investing in telemedicine, you know, what specific aspects are you looking to bolster there? And is that more Ingresa specific? Or is that more bringing in the whole commercial expertise here? Any color there'd be great.

Specific aspects of your looking to bolster all day and is that more ingress of specific or is that more of bringing in the whole commercial expertise here any color that'd be great. Thanks.

Eric S. Benevich: Thanks. Eric, why don't you handle it? Yeah, happy to. With regard to Ongentis, certainly, we were heartened to see that there was improvement in Q2 versus Q1. And I have to reinforce that it's still very early in the launch process. This is the first once daily QMT or Compton inhibitor in the US.

Eric why don't you handle those.

Yeah happy to with regards to engender certainly we were heartened to see that there was improvement.

In Q2 versus Q1, and I have to reinforce the it's still very early.

In the launch process. This is the first the once a day C. O M. T are comped inhibitor in the U S.

Eric S. Benevich: And we're still reaching many of our neurology HCP customers, introducing them to this new medicine and essentially reintroducing them to the idea of Compton inhibition. And so the feedback that we're getting has been very positive from the providers in neurology who have started to utilize this in their first patients. In fact, one of the maybe surprising elements for me is that many providers have said that it exceeded their expectations in terms of how open it is, and what a strong treatment effect they're seeing in these patients, which is a great thing to hear.

And we're still reaching many of our neurology.

HCP customers.

Introducing them to this new medicine in essentially reintroduced to the idea of comps inhibition.

And so the feedback that we're getting has been very positive from the providers the neurology that has.

<unk> started to utilize this in their first patients in fact, 1 of the maybe surprising elements for me is that the many providers of said that it exceeded their expectations in terms of how important it is.

What a strong treatment effect, we're seeing in these patients which is of great thing to hear.

Eric S. Benevich: So we're continuing to execute against our plan, introducing Ongentis to movement disorder neurologists, as well as general neurologists that treat Parkinson's disease, and certainly, you know, continuing to encourage providers to consider using it early in the treatment paradigm. Right now, or going into this launch, I should say, Compton inhibitors were essentially a third-line option for many of these patients on adjunctive treatments. And we're encouraging providers to think about using Ongentis earlier, especially as an alternative to a dopamine agonist or when a patient and the provider are having a conversation about potentially increasing the dose of levofopa.

So we're continuing to execute against our plan of.

Introducing on Genesis to movement disorder, neurologists as well as general urologists that treat.

Parkinson's disease, and certainly <unk>.

Continuing to.

Encourage providers to consider using it early in the in the treatment paradigm.

Right now we're going into this launch I should say.

The inhibitors, where essentially a third of third line option for many of these patients.

On the adjunct of treatments.

We're encouraging providers to think about using on justice earlier.

Especially as an alternative to of dopamine agonists or when a patient and the provider. They are provider of having a conversation about potentially increasing the dose of levodopa.

Eric S. Benevich: So we're seeing good progress there and feel good about the progress that we're making. And then, with regard to telehealth, yeah, certainly the investments that we're making in telehealth are primarily related to the TD opportunity for Ingresa. For the most part, we're seeing much less use of telehealth in neurology, and neurologists would tell you that, you know, they need to do a physical exam to make a diagnosis of Parkinson's. For example, most of the patients with Tardive Dyskinesia are under the care of psychiatrists or advanced practice providers in psychiatry.

So we're seeing good progress there and feel good about the progress of making.

And then with regards to the telehealth, yes, certainly the investments that we're making in <unk>.

Telehealth are primarily related to the.

Of the TD opportunity flooring breza.

For the most parts, we're seeing much less use of telehealth and neurology.

And neurologist would tell you that they need to do of physical exam to make the diagnosis of Parkinson's.

For example.

Most of the patients with tardive dyskinesia are under the care of us of psychiatrists or advanced practice providers in the psychiatry.

And so everything we're doing.

Eric S. Benevich: And so everything we're doing in telehealth is really related to trying to make TV a little easier to recognize and diagnose virtually as well as helping providers to understand how they can advance that diagnostic process, whether they can do the entire diagnosis remotely, or whether they're going to encourage the patient to come in for a follow-up and a physical exam. But I think that the progress that we're seeing in terms of a return to growth in Q2 can be attributed both to better conditions on the ground related to the pandemic but also to adapting, as Kevin said, and getting better at helping our customers to recognize, diagnose, and treat TB remotely. To the next caller Yep, we'll move next to Danielle Brill and Raymond James.

Telehealth is really related to trying to make the T V.

Total easier to recognize diagnose virtually.

As well as.

Helping providers to understand how they can advance that diagnostic process, whether they can do the entire diagnosis remotely or whether they're going to encourage the patients come in for a follow up of the physical exam, but.

But I think that the.

The progress that we're seeing in terms of return to growth in Q2.

Can be attributed both to aesthetic conditions on the ground related to the pandemic, but also.

Adapting as Kevin said and getting better at helping our customers to recognize diagnose and treat.

The rule of law.

Okay.

So the next caller current.

Well move next to Danielle Brill with Raymond James. Please go ahead.

Danielle Catherine Brill: Please go ahead. Hi guys, good afternoon. Congratulations on the quarter. And thanks so much for the question. Just a quick one from me.

Hey, guys. Good afternoon, congrats on the quarter and thanks. So much for the question just a quick 1 from me.

Danielle Catherine Brill: In your guidance for 3Q, the sequential growth of 15 million, is that on an inventory adjusted basis? Thanks. Matt, Yeah, that's on an underlying basis on an inventory adjusted basis. I think where that would put you is somewhere in the 280 ish range.

And your guidance for 3 key of the sequential growth of 15 million is that I'm, an inventory of adjusted basis. Thanks.

Beth.

Yeah, that's on the and underlying basis on the inventory adjusted basis, I think where that would put a put you is somewhere in the $2.80 ish range.

Matthew C. Abernethy: And I think, as we commented earlier, that's drawn based on history and what we've seen going from Q2 to Q3, and then also some of the other variables that we are keeping a close eye on associated with the Delta variant. [inaudible] We'll move next to Laura Chico with Wedbush Securities. Please go ahead.

And I think as we've commented on earlier, that's the drawn based upon history and what we've seen going from Q2 to Q3 and then also some of the other variables that we are.

Keeping a close eye on associated with the Delta variant.

And so the next day.

We'll move next to Laura Chico with Wedbush Securities. Please go ahead.

Laura Chico: Hey, thanks guys for taking my question. One more on guidance. It certainly seems like you're providing a great framework for the outlook on a quarterly basis. And I guess I just wanted to ask, if I missed this earlier, but how are you thinking about providing longer-term guidance? And I guess what are some of the considerations, obviously the pandemic is a little bit of a wildcard, but again, certainly seems like you have a good fix on things. So just wondering how we should think about the potential for longer-term guidance to emerge. Thanks.

Hey, Thanks, guys for taking the question 1 more on guidance.

It certainly seems like you're providing a great frameworks of the outlook on a quarterly basis and I guess I just wanted to ask apologies if I missed this earlier, but how are you thinking about providing longer term guidance and I guess what are some of the considerations, obviously pandemic a little bit of a wildcard, but again it certainly seems like you have a good fix on things.

Just wondering how we should think about.

So for a longer term guidance to emerge.

Kevin C. Gorman: Yeah, so I'll take that first, and Matt can jump in here, the reason why we've been more forthcoming recently is that we don't try to give specifics like here; we feel real good about this number, really good about that number. What we're trying to do is these are pretty unprecedented times without getting more detailed about the things that we're facing and the challenges that we're facing. And as you can see, we're not always getting it right, even when we're trying to be more specific with you.

Yeah, So I'll take the first and Matt can jump in here is the giving guidance of something that we constantly talk about the the reason why we.

<unk> been more forthcoming recently as is is not to try to get it.

The specifics like here, we feel real good about this number of real good about that number what we're trying to do is they use of pretty unprecedented times.

It is it is very difficult.

Several quarters.

Now and trying to give you.

Without without.

Yeah.

Without getting more detailed is to the things that that we are facing and the challenges that we're facing initiatives can see.

We're not always getting it right even when we're trying to be more specific with you and that's because of these and I'll use that overworked term. These unprecedented times that we're dealing with.

Kevin C. Gorman: And it's because of these, and I'll use that overworked term, these unprecedented times that we're dealing with, and particularly in our, in our universe with psychiatry, and the openings and closings of clinics and the very large use of telemedicine here, it is challenging to try to be able to nail things really well. In the future, I do see us at some point going to a more annual guidance. But right now, what we're just trying to do is give you as much information as we feel comfortable with and with the degree of confidence that we have. Matt, what would you have to add to that?

And particularly in our in our universe with psychiatry.

And the openings and closings of clinics and the the very large use of telemedicine here it is challenging.

To try to be able to nail things really well in the future I do see us at some point that we would go to a more annual guidance, but right now what we're just trying to do is where we're trying to give you as much information as.

We feel comfortable and with the degree of confidence that we have Matt what would you add to that.

Matthew C. Abernethy: You covered that, Kevin. It's something that we continue to talk about. You should expect, at some point, we would be providing an annual guide, and we would move away from the quarterly detail that we're providing now during these unprecedented times.

No you covered it Kevin it's something that we continue to talk about you should.

Specced at some point, we would be providing an annual guide.

And we would move away from the quarterly detail that we're providing now during these unprecedented times, but it is on our radar and something that will continue the to think true.

Kevin C. Gorman: But it is on our radar and something that we'll continue to think through. And the last thing I would say is that even without the coronavirus, recall, we launched into a market that is extremely unusual in the fact that there's never been a medication for tardive dyskinesia, and virtually none of the patients were diagnosed with it. And much about tardive dyskinesia was never taught in medical schools or even residency programs. So, remember right from the very beginning.

And the last thing I would say is is that.

Even without the Corona virus recall, we launched into a market that is the.

Yeah. It is.

Extremely unusual.

And the fact that there's never been a medication for tardive dyskinesia.

And virtually none of the patients were diagnosed with it and much about tardive dyskinesia was never being taught.

In medical schools urban residency programs, so recall right from the very beginning.

Kevin C. Gorman: It is a challenging area that we got into, and that's why I'm so proud of our commercial and medical teams for what they've been able to do now to get up to about a 20% diagnosis rate. Okay, let's take one last question. Absolutely. We'll take our last question from Yatin Suneja with Guggenheim. Please go ahead. Yeah, hey guys, this is Eddie on Fiat.

It is a it is a challenging area that we got into the.

And that's why I'm, so proud of our commercial and medical teams with what they've been able to do now to get up to about a 20 per cent diagnosis rate.

So let's take 1 last question.

Absolutely we'll take our last question from me of teens soon Asia with Guggenheim. Please go ahead.

Yatin Suneja: And thanks for squeezing me in here and congrats on the quarter. Just one quick follow-up on the Argentis program. Thanks for the color on sort of what could be causing the slow launch.

Oh, Yeah, Hey, guys. This is Eddie on for yacht and thanks for squeezing me in here and congrats on the quarter. Just 1 quick follow up on the agenda program. Thanks for the color on sort of what could be causing the slow launch, but do you have a sense of when it will start to pick up and what the sort of peak projections could be for that like what the opportunity of that that market would be of actually and how long it will take to get there.

Yatin Suneja: But do you have a sense of when it will start to pick up and what the sort of peak projections could be for that, like what the opportunity in that market will be eventually and how long it will take to get there? Thanks. Eric. Yeah, we haven't given any specific guidance with regard to what you know, what the peak potential is for on gentis.

Thanks.

Eric.

Yeah, we haven't given any specific guidance with regards to what what the peak potential is from Genesis.

Eric S. Benevich: However, you know, I will say that there are about a million patients in the US with Parkinson's disease. Of them, about two-thirds are on levodopa and adjunctive treatment. So that's the addressable patient pool. Launching on Gentis, there were, you know, a few things that we pointed out that we're going to create near-term challenges. One issue was that the comp class constitutes less than 10% market share of those adjunctive treatments. The second issue was the fact that Ongentis was developed entirely outside of the US.

However.

I will say that it was about 1 million patients in the U S with Parkinson's disease.

Of them about 2 thirds are on the levodopa and an adjunct of treatment. So that's the addressable patient pool.

Launching on Genesis. There was you know a few things that we pointed out that we're going to create near term challenges 1 was that the.

The comp class.

Constitutes less than 10% market share of those adjunct of treatments.

The issue was the fact that on Genesis was developed entirely outside of the U S. So there were no.

Eric S. Benevich: So there was no, there was no clinical experience amongst thought leaders in Parkinson's disease. And then the biggest issue for us, frankly, was the fact that we launched Ongentis at the very end of Q3 last year, at the very beginning of Q4, in the heat of the pandemic, which really hampered our ability to get in front of a movement disorder neurologist and introduce this new medicine. So those are all, you know, challenges that we've embraced, and we recognize that we have to overcome. But we feel really good about the clinical profile of Ongentis. It's a great medicine with a really strong label.

There was no clinical experienced amongst thought leaders of Parkinson's disease, and then the biggest issue for US frankly was the <unk>.

That we that we launched on Genesis at the very end of Q3 last year very beginning of Q4.

In the teeth of.

Of the pandemic.

Which really hampered our ability to get in front of a movement disorder neurologists and introduced this new medicine.

So those are all challenges that we've embraced and we recognize that we have to overcome but we feel really good about the clinical profile of 1 channel that's of great medicines.

With the really strong label.

Eric S. Benevich: And certainly, the feedback, as I mentioned before, when providers start to try it in select patients, their experience has been positive. So we're going to continue to press forward with this important medicine. The other thing that I should mention is that Ongentis represents, you know, to the movement disorder community, our continuing commitment to movement disorders and certainly to movement disorder neurologists. When we come to their practice, we now have two medicines that we can talk about, Ongentis and Parkinson's disease, Ingresa and tardive dyskinesia.

And certainly the feedback as I mentioned before when providers start to try it and select patients you know the experience has been positive. So we're going to continue the suppress forward.

With this important medicine. The other thing that I should mention is that this represents.

The movement disorder community are continuing.

Our commitment to movement disorders, and certainly the movement disorder neurologists.

When we come to their practice, we have now 2 medicines that we can talk about on justice and Parkinson's disease in Gaza and tried to of dyskinesia and frankly on Genesis gives additional opportunity for us.

Eric S. Benevich: And frankly, Ongentis gives additional opportunity for us to have time and attention with those movement specialists to benefit Ingresa and the TD indications. So, you know, we'll continue to execute against our plan. We'll continue, I believe, to see positive momentum in terms of new patient starts and growth for this brand. So, you know, I look forward to sharing what that progress looks like on the next call. And it does appear that there are no further questions at this time.

To have time and attention with those moving specialists.

Benefits browser and the TD indications. So we'll continue to execute against our plan will continue I believe to see positive momentum in terms of new patient starts and growth for this brand.

So look forward the sharing.

What's the progress looks like on the next call.

Yeah.

And it does appear there are no further questions at this time I would now like to turn it back to Kevin Gorman for any closing remarks.

Eric S. Benevich: I would now like to turn it back to Kevin Gorman for any closing remarks. Thank you. I really do appreciate all the questions that we got here today. The thing that I'm most proud of and that I would like you to take away from this call is that Neurocrine is adapting to the environment that we're in and that we will continue to be in for probably a number of years here. We're not going to go back to where business was as usual, anytime soon, or maybe ever.

Thank you I really do appreciate all the questions that we got here today.

You know the the thing that I'm, most proud of them and I would like you to take away from this call is is that.

Neurocrine is adapting to.

To the environment that we're that we've been in and that we will continue to be in sort of probably a number of years here.

We're not going to go back to where business was as usual.

Anytime soon or maybe ever.

Kevin C. Gorman: And so we continue to invest and adapt. And I'm, and I think we've done that quite well. Psychiatry may stay at 50% telemedicine going into the future, and that's just fine. If we do believe that telemedicine is a very good tool for healthcare providers and for patients, it is certainly no replacement for face-to-face, in-person care. And so we do see that going more and more back to in-person care, but never to the levels that it was before.

So we continue to invest and adapt and I'm and I think we've done that quite well.

The psychiatry may stay at 50%, a telemedicine going into the future.

And that's just fine if we do believe that telemedicine is a very good tool.

For health care providers and for patients, but it is certainly no replacement.

For face to face in person care and so we do see that as going as doing the more and more back to in person care, but never to the levels of it was before.

Kevin C. Gorman: But that's fine. We are going to, TD is a disorder that is more and more being recognized by the medical community and by patients and their caregivers as something that has to be treated. And so we are at the very beginnings of treating TD patients, and we are going to continue to invest, and you're going to see us continue to have extremely good growth in bringing Ingressa to these sufferers of tardive dyskinesia and potentially other disorders.

But that's fine.

We are going to TB is a disorder that is more and more being recognized by the medical community and by patients and their caveat of caregivers that it has to be treated.

And so we are at the very beginnings of treating TD patients.

And we are going to continue to invest and you're going to see us continue to have extremely good growth in bringing.

In grocer to these.

To the sufferers of tardive dyskinesia and potentially other disorders.

Kevin C. Gorman: We're also, as you see, Sticking to exactly what our mission has been of the company, and that is to be a premier neuroscience company, and we are growing and advancing our pipeline with each passing year, and so neuroscience means neurology, it means neuropsychiatry, it means neuroendocrinology and at some point in the future neuroimmunology to us and so you're going to see us continuously bringing new compounds into the clinic both from internal research and from partnering with excellent collaborators.

We're also of the as.

As you see.

Looking to exactly what our mission has been of the company and that has to be a premier neuroscience company.

And we are growing and advancing our pipeline with each passing year.

And so neuroscience means.

Neurology it means neuropsychiatry it means neuroendocrinology.

And at some point in the future neuro immunology to us and so you're going to see us continuously.

Bringing new compounds into the clinic, both from internal research and from partnering with.

With excellent collaborators.

Kevin C. Gorman: So with that, we'll bring this call to a close. I am still confident that at some point before this year is out, we're gonna be able to meet with many of you personally. And so I'm hopeful that as long as we all stay safe, continue to get vaccinated, we will be able to all get back to visiting one another in person. So with that, I will end this call. Take care, and thank you for your attention. This does conclude today's program. Thank you for your participation. You may disconnect at any time.

So with that.

We'll bring this call 2 of close I am still confident that at some point before this year is out we're going to be able to meet with many of you personally.

And so I'm hopeful that as long as we all stay safe continue to get vaccinated.

That we will be able to all get back to visiting 1 another in person.

So with that I will end this call take care of and thank you for your attention.

This does conclude today's program. Thank you for your participation you may disconnect at any time the bi.

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