Q2 2021 ACADIA Pharmaceuticals Inc Earnings Call

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Jonathan: Good day, ladies and gentlemen, and welcome to the ACADIA Pharmaceuticals Quarter 2021 Financial Results Conference Call. My name is Jonathan, and I will be your coordinator for today. At this time, all participants are in a listen-only mode.

Yeah.

Jonathan: We will be facilitating a question and answers session towards the end of today's call. If at any time during the call you require assistance, please press star followed by zero, and a coordinator will be happy to assist you. I would now like to turn the presentation over to Mr. Mark Johnson, Vice President of Investor Relations at ACADIA. Please proceed.

Good day, ladies and gentlemen, and welcome to the Acadia Pharmaceuticals quarter 2021 financial results Conference call. My name is Jonathan and I won't be your coordinator for today at this time all participants are in a listen only mode. We will be facilitating a question and answers session towards the end of todays call. If at any time during the call you require assisted.

Mark C. Johnson: Good afternoon, and thank you for joining us on today's call to discuss Acadia's second quarter 2021 financial results. Joining me on the call today from ACADIA are Steve Davis, our Chief Executive Officer, who will provide an overview of our Q2 2021 financial performance and a review of our business operations. Also joining us today is Amanda Morgan, our Chief Revenue and Customer Officer, and Charmaine Likens, Global Product Planning and Chief Marketing Officer, who will provide updates on our commercial performance.

Please press star followed by zero and a coordinator will be happy to assist you I would now like to turn the presentation over to Mr. Mark Johnson, Vice President of Investor Relations. Please proceed.

Good afternoon, and thank you for joining us on today's call to discuss Acadia second quarter 2021 financial results.

Joining me on the call today from Acadia are Steve Davis, our Chief Executive Officer, who will provide an overview of our Q2.2021 financial performance and a review of our business operations also joining us today as Amanda Morgan, our chief revenue and customer officer, and Charmaine ligand global product planning and Chief marketing Officer, who will provide updates on our commercial performance.

Mark C. Johnson: Dr. Serge Stankovich, our President, will discuss our pipeline progress, and our Chief Financial Officer, Elena Ridloff, will then discuss our financial results in more detail before turning it back to Steve for final remarks and opening the call up for your questions. I would also like to point out that we are using supplementary slides, which are available on the events and presentation section of our website.

Dr. Serge Stankovic, our president will discuss our pipeline progress and our Chief Financial Officer, Atlanta Red Lobster will then discuss our financial results in more detail before turning it back to Steve for final remarks, and opening the call up for your questions.

I would also like to point out that we are using supplement slides, which are available on the events and presentations section of our website.

Mark C. Johnson: Before we proceed, I would first like to remind you that during our call today, we will be making a number of forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements, including goals, expectations, plans, prospects, growth potential, timing of events, or future results, are based on current information, assumptions, and expectations that are inherently subject to change and involve a number of risks and uncertainties that may cause actual results to differ materially.

Before we proceed I would first like to remind you that during our call today, we will be making a number of forward looking statements within the meaning of the private Securities Litigation Reform Act of 1995 be forward looking statements, including goals expectations plans prospects growth potential timing of events or future results are based on current information assumptions and expectations that are inherently subject to change.

And involve a number of risks and uncertainties that may cause actual results to differ materially. These.

Mark C. Johnson: These factors and other risks associated with our business can be found in our filings made with the SEC. You are cautioned not to place undue reliance on these forward-looking statements, which are made only as of today's date. I will now turn the call over to Steve.

These factors and other risks associated with our business can be found in our filings made with the SEC you are cautioned not to place undue reliance on these forward looking statements, which are made only as of today's date.

I'll now turn the call over to Steve.

Stephen R. Davis: Thank you, Mark. Good afternoon, everyone, and thank you for joining us today. I'd like to start with a review of our commercial performance, followed by some important company news. Please turn to slide four. For the second quarter of 2021, Nucleus achieved $115.2 million in net sales, representing a 5% year-over-year increase driven by sequential and year-over-year volume growth. As a result of a slower pace of pandemic recovery and higher-than-expected growth in net sales, we are projecting net sales for the year at $480 to $515 million. Elenia will discuss the gross net dynamics in greater detail in her section.

Thank you Mark.

Afternoon, everyone and thank you for joining us today I'd.

I'd like to start with a review of our commercial performance followed by some important company updates please turn to slide 4.

For the second quarter of 2021, NUPLAZID achieved $115.2 million in net sales, representing a 5% year over year increase driven by sequential and year over year volume growth.

As a result of a slower pace of pandemic recovery and a higher than expected gross to net.

We are projecting net sales for the yard for 480 and $515 million.

They will discuss the gross to net dynamics in greater detail in her section.

Stephen R. Davis: Let me speak to the continuing impacts of the pandemic which impacted our growth in the second quarter. In the office space channel, Parkinson's patients' visits in the quarter were down 20% from the pre-pandemic level. This is important because many physicians are hesitant to start patients on a new therapy without diagnosing them first in person. So while we still grew new patient starts in the quarter, the rate of growth in new patient starts was significantly impacted by reduced Parkinson's patient visits. In the long-term care channel, occupancy rates are currently approximately 15% below pre-pandemic levels, and new admissions are down approximately 17%.

Let me speak to the continuing impacts of the pandemic, which impacted our growth in the second quarter.

In the office space Channel Parkinson's patient visits in the quarter were down 20% from pre pandemic levels.

This is important because many physicians are hesitant patient on a new therapy without diagnosing them first in person.

So while we still grew new patient starts in the quarter the rate of growth in the new patient starts were significantly impacted by reduced Parkinson's patient visits.

In the long term care channel occupancy rate facilities are currently approximately 15% below pre pandemic levels, a new admissions are down approximately 17%.

Stephen R. Davis: For many of our patients, being in or admitted to a long-term care facility often coincides with a PDP diagnosis, and thus, a new patient starts on a new plan. However, the reduction in both ongoing occupancy rates and new patient admissions continues to impact our ability to start new patients on nuclizate in the LTC setting. Despite these impacts of the pandemic on the patient population, we've grown our new patient stars and our business overall.

For many of our patients being in or admitted to a long term care facility often coincides with the PDP diagnosis and thus a new patient start on NUPLAZID.

The reduction in both ongoing occupancy rates and new patient admissions continued to impact our ability to start new patients on NUPLAZID in the LTC setting.

Despite these impacts of the pandemic on expense.

Patient population, we've grown our new patient starts and our business overall.

Stephen R. Davis: Our ability to grow despite these headwinds is further reinforced by our strong relative performance compared to other branded products in the long-term care channel. Patient visits, long-term care facility admissions, and less in-person detailing were headwinds that slowed our growth in the second quarter. These headwinds are, of course, temporal.

Our ability to grow. Despite these headwinds is further reinforced by our strong relative performance compared to other branded products in the long term care channel.

Shouldn't visits long term care facility admissions and less in person detailing were headwinds that slowed our growth in the second quarter.

Headwinds are of course simple.

Stephen R. Davis: Going forward, despite these headwinds, we expect to continue to grow our business, including and using sequential volume growth and new patient starts. As pandemic conditions for the Parkinson's community improve, we expect these headwinds to become tailwinds, further accelerating our. In addition, we have commenced several PDP growth initiatives that Amanda and Charmaine will speak to in a moment. Now, let's move to an update on our DRP program on slide 5. We recently completed a type A end of review meeting with the FDA to discuss the issues raised in the complete response letter that we received in April. Today, we'd like to share the key takeaways from that meeting.

Going forward. Despite these headwinds we expect to continue to grow our business Inc.

When you had sequential volume growth in new patient starts.

As pandemic conditions for the Parkinson's community improve we expect these headwinds to become tail ones further accelerating our growth.

In addition, we have commenced several PDP growth initiatives that Amanda and Charmaine will speak to in a moment.

Let's move to an update on our DRP program on slide 5.

We recently completed a type a and a review meeting with the FDA to discuss the issues raised in the complete response letter that we received in April.

Today, we'd like to share the key takeaways from that meeting.

Stephen R. Davis: First, the FDA reaffirmed its stated position in the CRL that Pimivanserin should be studied in individual subgroups of dementia and advised us that the best path forward is to conduct an additional clinical study in each of the subgroups for which we seek approval. In the meeting, we highlighted the consistent and clinically meaningful efficacy observed in the DRP population overall, as well as across individual dementia subgroups, Alzheimer's disease, dementia with Lewy bodies, Parkinson's disease dementia, and patients with mixed pathology.

First the FDA reaffirmed their stated position and the seawell debt Timothy answering should be studied by individual subgroups of dementia.

And advised us that the best path forward to conduct an additional clinical study in each of the subgroups for which we seek approval.

In the meeting we highlighted the consistent and clinically meaningful efficacy observed in the DRP population overall as well as across individual dementia.

Alzheimer's disease dementia, with Lewy bodies, Parkinson's disease dementia in patients with mixed anthologies.

As a result for these discussions.

Stephen R. Davis: The FDA indicated that they are open to discussing additional analyses from the Harmony Study and the 019 Study that may support a potential resubmission without conducting an additional study. We're planning to discuss these analyses with the FDA at a meeting later this year. In parallel with preparations for this meeting, we will also prepare for all potential outcomes that may come from this discussion.

The FDA indicated that they are open to discuss additional analyses from the harmony study and the old 1.9 study that may support a potential resubmission without conducting an additional study.

We're planning to discuss analyses with the FDA at a meeting later this year.

In parallel with preparations for this meeting we will also prepare for all potential outcomes that may come from this discussion.

Stephen R. Davis: In addition to DRPE, let me highlight clinical updates as we turn to slide six. We recently completed enrollment in our Phase III program for Trophinatide and Rett Syndrome and are on track to deliver top-line results by the end of the year. Our Phase III program for preventive answering for the negative symptoms of schizophrenia continues to enroll well. As a reminder, the Pivotal ADVANCE II study was started in the third quarter of last year.

In addition to DRP, let me highlight clinical updates since we turn to slide 6.

We recently completed enrollment from our phase III program for Tryphena tied in Ret syndrome and are on track to deliver topline results by the end of the year.

Our phase III program for <unk> for the negative symptoms of schizophrenia continues to enroll well.

As a reminder, the pivotal advance 2 study was started in the third quarter of last year.

Stephen R. Davis: Earlier this year, we initiated a Phase 2 study evaluating ACP-044 for postoperative pain associated with bunionectomy surgery, and we expect top line results later this year. Furthermore, in the second quarter, we initiated a phase 2 study evaluating O44 for pain associated with osteoarthritis. Assistive development continues to be a key priority for our strategy to expand our pipeline for long-term growth and bring new therapies to patients with high unmet needs. I would now like to turn the call over to Amanda Charmaine to discuss our second quarter commercial performance and growth initiatives.

Earlier this year, we initiated a phase II study evaluating ACP hopeful for for post operative pain associated with funding activity start.

And we expect top line results later this year.

Furthermore, in the second quarter, we initiated a phase II study evaluating <unk> for for pain associated with osteoarthritis.

This is development continues to be a key priority for our strategy to expand our pipeline for long term growth and bring new therapies to patients with high unmet needs.

I would now like to turn the call over to Amanda ensure meeting to discuss our second quarter commercial performance and growth initiatives.

Amanda Morgan: Thank you, Steve. Today, I'd like to review our second quarter.

Thank you D. Today I'd like to review, our second quarter performance.

Amanda Morgan: This concludes our second quarter performance and our long-term expectations for Neuplavid and Parkinson's disease psychosis. Please turn to slide 8. In the quarter, we delivered net sales of $115.2 million, with sequential volume growth of 3% across both the office space and long-term care channel. This quarterly performance was primarily driven by new patient starts and continuing patients, which demonstrated strong patient adherence and compliance.

Expectations for NUPLAZID in Parkinson's disease psychosis.

Please turn to slide 8.

In the quarter, we delivered net sales of $115 million with sequential volume growth of 3% across both the occupancy and long term care channel.

This quarterly performance.

Primarily driven by new patient starts and continuing patients, which demonstrated strong patient adherence and compliance.

Amanda Morgan: Although new patient starts are consistent with pre-pandemic levels, they are not yet accelerating at our expected rate. We believe the reason for this is that growth of new patient starts is dependent upon Parkinson's patient office visits and new admissions and occupancy rates within the long-term care channel, both of which have slowed due to the continued impact of the pandemic. The challenges related to the pandemic have disproportionately affected the patient population we serve.

Although new patient starts are consistent with pre pandemic level, they are not yet accelerating and our expected rate.

The reasons for day, because that growth in new patient starts are dependent upon Parkinson's patient visits.

New admissions and occupancy rates within the long term care channel.

Both of which have slowed due to the continued impact of the pandemic.

The challenges related to the pandemic has disproportionately affected the patient population, which we shared.

Amanda Morgan: To give you further color on this, as shown in the graph on the left, Parkinson's patient visits within the office-based setting were still approximately 20% below pre-pandemic levels in the quarter. We know physician-patient visits are highly correlated with new patient starts.

To give you further color on this as shown in the graph on the left Parkinson's patient visits.

Day, setting for sale approximately 20% below pre pandemic levels in the quarter.

We know physician patient visits are highly correlated with new patient start and therefore, we are confident that information for Cherokee their physician offices, new patient starts will increase.

Amanda Morgan: All of these are highly correlated with new patient starts, and therefore, we are confident that as patients return to their physician offices, new patient starts will increase, resulting in greater new plasma demand, which will drive market penetration. Despite office-based visits being down, new patient starts in total have remained at pre-pandemic levels, as highlighted in the graph on the right, reflecting our team's ability to execute in a challenging environment. We've been able to accomplish this through our HCP messaging platform, which enhances PD psychosis symptom identification.

Seeing greater NUPLAZID demand, which will drive market penetration.

Just about any other space visits being down.

New patient starts in total have remained at pre pandemic level.

As highlighted in the graph on the right.

Reflecting our team's ability to execute in a challenging environment.

We've been able to accomplish this through our HCP messaging, which elevate PD psychosis symptom identification and highlight the efficacy and safety of NUPLAZID and the urgency to treat psychosis early.

Amanda Morgan: and highlights the efficacy and safety of Neuplazid and the urgency.

Amanda Morgan: New Plazid, and the urgency to treat psychosis early.

Please turn to slide 9.

Amanda Morgan: Now, we are turning our attention to the Long-Term Care Channel.

Now turning our attention to the long term care channel.

Amanda Morgan: As you can see from the graph on the right, occupancy levels have been slowly improving at 0.5% to 1% each month. However, they are still 15% below pre-COVID levels. For many patients, the identification of hallucinations and delusions resulting in a diagnosis of PDP often occurs in a long-term care facility and may coincide with a new resident admission.

And you can see from the graph on the top right occupancy levels have been slowly improving and half a percent for 1% each month. However.

However, they are still 15% below pre COVID-19 level.

For many patients the identification of hallucinations and delusions.

The other thing in the diagnosis of PDP often occurred for a long term care facility and may coincide with a new resident admission.

You had mentioned an increase in occupancy levels return to normal we fully expect our momentum to translate into accelerated growth within the OTC channel.

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Amanda Morgan: As shown in the graph on the bottom right, long-term care bottles began growing sequentially in the second quarter as a result of our enhanced marketing and promotional messaging and a modest increase in patients within long-term care facilities. Overall, we are encouraged that Nuclavit's growth outperforms foundational Parkinson's medications. Including Carbidopa and levofopa as well as a market basket of branded LCC products across multiple therapeutic areas, this performance indicates strong brand support and positions us to accelerate growth within this setting.

As shown in the graph on the bottom right long term care bottles for young growing sequentially in the second quarter as a result of our enhanced marketing and promotional messaging and a modest increase of patients within long term care facility.

Overall, we are encouraged of NUPLAZID growth outperformed foundational Parkinson's medications, including carbon for levodopa as well as a market basket of branded LTC products across multiple therapeutic areas.

This performance indicates strong brand support and positions us to accelerate growth within this setting.

Amanda Morgan: In the near term, our ability to accelerate growth will be largely dependent on growth

And the near term our ability to accelerate growth will be largely dependent.

Amanda Morgan: On the pace of recovery of patient office visits, LTC new admissions, and face-to-face engagement. Regardless of this, we have implemented new growth initiatives, which Charmaine will now highlight. Thanks, Amanda.

On the patient recovery of patient office visits.

T C new admissions and thank you face engagement.

Starting with the debt.

Implemented new growth initiatives with Xiaomi will now highlight.

Thanks, Amanda please turn to slide 10.

Charmaine Likens: Please turn to slide 10. Let's discuss our new growth initiatives, which will position us well in the second half of the year to capitalize on improvements to the leading indicators that Amanda just discussed. These initiatives incorporate new market research insights, specifically as it pertains to awareness of Neuplazid's safety and tolerability profile, and in light of other important medical considerations when treating Parkinson's patients. Our growth initiatives leverage important clinical data, newly available for New Plaza promotion, to highlight New Plaza's safety benefits. The Plaza Safety Profile is a distinct advantage

Let's discuss our new growth initiatives, which will position us well in the second half of the year to capitalize on improvements to the leading indicators that Amanda just discussed.

These initiatives incorporate new market research and insights specifically as it pertains to awareness of NUPLAZID safety and Tolerability profile and in light of other important medical for considerations when treating Parkinson's patients.

Our growth initiatives leverage important clinical data newly available for NUPLAZID promotion to highlight NUPLAZID safety benefits.

NUPLAZID safety profile is a distinct advantage, we are elevating that advantage to increase diagnosis and capture a higher percentage of new PDP patients today.

Charmaine Likens: We are elevating that advantage to increase diagnosis and capture a higher percentage of new PDP patients. Today, less than 50% of patients with a PVP diagnosis receive treatment. Additionally, our market research indicates that 37% of physicians delay PD psychosis treatment because of safety concerns associated with off-label antipsychotics. In addition, a key concern in Parkinson's patients is scalds, and another is motor impairment.

Today less than 50% of patients with the PDP diagnosis receive treatment.

And also our market research indicates that 37% of physicians delay PD psychosis treatment because of safety concerns associated with off label anti Psychotics.

In addition, a key concern in Parkinson's patients this fall.

And then other is motor impairment argued.

Charmaine Likens: Our communication to HCP highlights that Neuplazid has no warnings for orthostatic hypotension-related or sedation-related events. Cognitive impairment is another concern for physicians, especially for Parkinson's patients who have been diagnosed with comorbid dementia. Our promotion materials will now include the SAPS PD efficacy data in the cognitively impaired subset of patients with MMSE scores ranging from 21 to 25 from our pivotal PDP study. Beyond efficacy, we will also communicate that there are no safety differences across age, gender, and cognition with duplazid treatment. After being presented with our new safety messages, approximately 77% of physicians stated that they would be more willing now to prescribe Nuplazid to treat PD psychosis than before. Please turn to slide 11.

Our communication to Hcp's highlights that NUPLAZID has no warning for orthostatic hypotension related or sedation related events.

Cognitive impairment is another concern for physicians, especially for Parkinson's patients who've been diagnosed with comorbid dementia.

Our promotion materials will now include the saps PD efficacy data in the cognitive cognitively impaired subset of patients with MSE scores ranging from 21 to 25 from our pivotal PDP study.

Beyond efficacy, we will also communicate that there are no safety differences across age gender and cognition with NUPLAZID treatment.

After being presented with our new safety messages approximately 77% of physicians stated that they would be more willing now to prescribed NUPLAZID to treat PD psychosis earlier than before.

Please turn to slide 11.

Our promotional messaging highlights the efficacy and safety of NUPLAZID and amplifies our improvement without impairment strategic vision.

Charmaine Likens: Our promotional messaging highlights the efficacy and safety of Duplazid and amplifies our improvement without impairment strategic vision. The new messaging will be executed across all promotional channels, including our field teams, in the second half of the year. We continue to see strong brand support for Neuplazid and high engagement for our promotional presentations at medical congresses, with over 2,000 HCPs attending a branded Neuplazid program in Q2. Additionally, we continue to amplify our message through digital and non-personal promotion efforts to reach our target healthcare providers.

The new messaging will be executed across all promotional channel, including our field teams and the second half of the year.

We continue to see strong brand support for NUPLAZID and high engagement of our promotional presentations at medical Congresses with over 2000 Hcp's attending it Brandon NUPLAZID program in Q2.

Additionally, we continue to amplify our message through digital and non personal promotion efforts to reach our target healthcare providers.

We've increased our efforts with caregivers and patients to drive more patient identification.

Our consumer programs educate patients and caregivers about the signs and symptoms of PD psychosis and why it's important to talk to your doctor.

While our DTC and digital platforms activate those patients to request NUPLAZID by name.

Charmaine Likens: We've increased our efforts with caregivers and patients to drive more patient identification. Our consumer programs educate patients and caregivers about the signs and symptoms of PD psychosis and why it's important to talk to your doctor. Our DTC and digital platforms empower those patients to request a deposit by name.

Our initiatives will increase patient identification in our promotional messages with a focus on safety.

Well to accelerate new patient starts in the back half of the year and drive long term prescription growth of NUPLAZID.

Now I'll turn it over to Serge to share our pipeline progress.

Thank you for me.

Good afternoon, everyone.

Turn to slide 13.

Charmaine Likens: Our initiatives will increase patient identification and our promotional messages with a focus on safety, set us up well to accelerate new patient starts in the back half of the year, and drive long-term prescription growth of new plasma. Now I'll turn it over to Serge to share our pipeline progress. Thank you, Charmaine. Good afternoon, everyone.

As Steve mentioned, we had a constructive dialogue with the FDA at our end of review.

Meaning.

While we still do not have alignment with the FDA on what.

Would take quarter redistribution, we're encouraged by the agencies awkwardness to continue the discussion.

Allow us to present additional data analyses.

Other support a resubmission without an additional clinical study.

Serge Stankovich: Please turn to slide 13. As Steve mentioned, we had a constructive dialogue with the FDA at our end of review type meeting. While we still do not have alignment with the FDA on what it would take for a resubmission, we are encouraged by the agency's openness to continue the discussion and allow us to present additional data analysis to further support a resubmission without an additional clinical study. Accordingly, it will take some time for us to prepare and for the FDA to schedule us.

Accordingly, it will take some time for us to prepare for the FDA to schedule. The meeting as such we will have an update on our own the outcome later this year.

Furthermore, consistent with the views expressed in the CRA old regarding individual sub groups of demand for sure.

It appears the division of psychiatry at the FDA.

Has changed their view on breakthrough therapy designation for dementia related psychosis and have notified us that they are considering rescinding. The DRP designation Corp. You may have answered it.

Serge Stankovich: As such, we will have an update on the outcome later this year. Furthermore, consistent with the views expressed in the CRL regarding individual subgroups of dementia, it appears the Division of Psychiatry at the FDA has changed its view on brachial therapy designation for dementia-related psychosis and has notified us that they are considering rescinding the DRP designation for primavanserine. We will be meeting with the FDA in the coming months to discuss FURDA. In the meantime, our new publications in both DRP and PDP continue to be received very well by the medical and scientific community. Let's discuss this further on slide 14.

We will be meeting with the FDA in the coming months to discuss word.

In the meantime.

Our new publications in both DRP and PDP continued to be received very well by the medical and scientific community.

Let's discuss further on slide 14.

I'm excited.

Added to share the positive results from our phase III Harmony study were published in the New England Journal of Medicine.

We are pleased to be able to share. These important findings that clearly demonstrate 3 main takeaways regarding remove answered as a potential treatment for DRP.

Serge Stankovich: I'm excited to share that the positive results from our Phase III Harmony Study were published in the New England Journal of Medicine. We are pleased to be able to share these important findings that clearly demonstrate three main takeaways regarding pimavanserin as a potential treatment for DRP. One, in the open-label portion of the study, pimavanserin treatment clearly demonstrated a meaningful reduction of the symptoms of psychosis. 2.

1 in.

In the open label portion of the study would be my answer in treatment clearly demonstrated a meaningful reduction of the symptoms of psychosis.

2.

Continuation of preamble answering treatment in the double blind portion significantly reduce the risk of relapse looks like closes by almost 3 times.

Serge Stankovich: Continuation of pimulanserine treatment in a double-blind portion significantly reduced the risk of relapse of psychosis by almost three times, and three, importantly, pivovanserin was not associated with a decline in cognition or motor symptoms and was well tolerated in elderly patients with dementia-related psychosis. Also in July, ACADIA hosted a Disease Awareness Symposium to further discuss the high unmet need for DRP at The symposium was highlighted by key experts in the field discussing whether dementia subtypes matter when it comes to treating psychosis and the urgency for awareness and appropriate management of hallucinations and delusions across dementia. The discussion among the experts was both consistent and supportive of our view that dementia-related psychosis is most appropriately studied broadly.

And 3 importantly, Stephen.

The answer is.

No other associated with the decline in cognition or motor symptoms and was well tolerated emailed elderly patients with dementia related psychosis.

Also in July Acadia hosted a disease awareness symposium to further discuss the high unmet need in DRP at this year bulk trade matters less association international calling for.

The symposium was highlighted by key experts in the field discussing whether dementia subtypes matter when it comes to treating psychosis.

The urgency for awareness and appropriate management for constellations and delusions of draws them air shows.

The discussion among the experts was both consistent and supportive of our view the dementia related psychosis is most appropriately studied broadly.

Serge Stankovich: In June, results from the Open Label Extension Study, which highlights the sustained pimavenserin response in patients with PDP, were published in Parkinsonism and Related Disorders. These data further demonstrate the utility of Pimavansurin in PDP. Let's move to our development stage pipeline, starting on slide 15, with an update on our Trophinotype program for rats. As Steve mentioned, we have recently completed enrollment in the Phase 3 Lavender Study and are on track to announce top-line results in the fourth quarter of this year.

In June results from the open label extension study, which highlight the sustained theme of answer in response in patients with PDP were published in parkinsonism and related disorder.

These data further demonstrate the utility of free mobile answering in PDP.

Let's move to our development stage pipeline, starting on slide 15, with an update on our for peanut program for <unk> syndrome.

As Steve mentioned, we have recently completed enrollment in the phase III allowed for this.

Study and are on track to announce top line results in the fourth quarter of this year.

Serge Stankovich: Turning to slide 16, our Phase 3 program evaluating pimavacirin for the treatment of negative symptoms of schizophrenia includes two pivotal studies, our positive ADVANCE-1 study and ADVANCE-2, which we initiated in the third quarter of last year. Enrollment continues to progress well and is on track.

Turning to slide 16, our phase III program evaluating <unk> for the treatment of negative symptoms schizophrenia includes 2 pivotal study.

We're positive about brands 1 study.

<unk>, 2 which we initiated in the third quarter of last year.

Enrolment continues to progress well and is on track.

Serge Stankovich: Please turn to slide 17 for an update on our ACP 044 program. ACPO 44 is a novel, first-in-class, orally-administered non-opioid analgesic that is being studied in both acute and chronic pain models. The Phase 2 study evaluating ACP-044 for the treatment of postoperative pain following bionectomy surgery is enrolling well, and we expect results in the fourth quarter of this year. Furthermore, we recently initiated a Phase II study for patients suffering from pain associated with osteoarthritis. Slide 18 highlights a brief summary of our ACP 319. M1 PAM Program for the Potential Treatment of Schizophrenia and Cognitive Impairment in Alzheimer's Disease.

Please turn to slide 17 for an update on our ACP old 40 for program.

ACP old 44 is a novel first in class orally administered non opioid analgesic that is being studied in both youth and growing existing model.

The phase 2 study evaluating ACP old 40 for for the treatment of post operative pain. Following Bunionectomy surgery is enrolling well and we expect the results in the fourth quarter of this year.

Furthermore, we recently initiated a phase 2 study for patients suffering from pain associated with osteoarthritis.

Slide 18 highlights a brief summary of our HCP $3.19.

M..1 Pam program for the potential treatment for schizophrenia, and cognitive impairment and Alzheimer's disease.

Serge Stankovich: As part of our transition, we are completing some additional non-clinical work and will be progressing our Phase I program with the initiation of a multiple ascending dose study in the fourth quarter of this year. Slide 19 summarizes our ongoing development timeline. Most notably, in the fourth quarter, we look forward to announcing top-line results from our phase 3 trophinatized study in Rett syndrome and top-line results from our phase 2 study for ACPO44 in post-operative pain. We look forward to keeping you updated as we advance our pipeline. With that, I will turn the call over to Elaine.

As part of our transition we are completing some additional non clinical work and will be progressing our phase 1 program with the initiation of a multiple ascending dose study in the fourth quarter of this year.

Slide 19 summarizes our ongoing development timeline Molson.

Most notably in the fourth quarter, we look forward to announcing topline results from our phase III throw phenotype study in Ret syndrome, and topline results from our phase 2 study for ACP, all 40 for enforced broker or the pain.

We look forward to keeping you updated as we advance our pipeline.

With that I will turn the call over to Alain for now.

Elena Ridloff: Thank you, Serge. Today I'll discuss our second quarter 2021 results and our updated 2021 financial outlook. Please turn to slide 21.

Thank you Serge.

I'll discuss our second quarter 2021 results and our updated 2021 financial outlook. Please turn to slide 21 in the second quarter 2021, we recorded a $115.2 million for net sales an increase of approximately 5% compared to $110.1 million in net sales.

Elena Ridloff: In the second quarter of 2021, we recorded $115.2 million in net sales, an increase of approximately 5% compared to $110.1 million in net sales in Q2 of 2020. This was driven by 5% volume growth year over year. The growth to net adjustment for Q2 2021 was 18.4%, compared to our expectations of mid-teens. Weeks of inventory in the channel at the end of the second quarter were relatively flat quarter over quarter and still at the high end of the range.

2 of 2020.

This is driven by 5% volume growth year over year.

The gross to net adjustment for Q2, 2021 was 18, 4% compared to our expectations of mid teens.

Weeks of inventory in the channel at the end of the second quarter were relatively flat quarter over quarter and still at the high end of the range.

Elena Ridloff: The Quetzal demand in Q2 outpaced reported growth due to inventory levels slightly increasing in Q1 and then remaining stable in Q2. Moving down the P&L, GAAP R&D expenses decreased to $56.9 million in the quarter, compared to $64.3 million in Q2 of 2020.

Sales demand in Q2 outpaced reported growth due to inventory levels slightly increasing in Q1, and then remaining stable in Q2.

Moving down the P&L GAAP R&D expenses decreased to $56.9 million from the quarter compared to $64.3 million in Q2 of 2020.

Elena Ridloff: GAAP SG&A expenses increased to $96.8 million in the second quarter from $84.3 million in the second quarter of last year.

GAAP SG&A expenses increased to $96.8 million from the second quarter from $84.3 million in the second quarter of last year noncash stock based compensation expense during the quarter was $22 million compared to $19.5 million for for the same period in 2020.

Elena Ridloff: Non-cash, stock-based compensation expense during the quarter was $22 million compared to $19.5 million for the same period in 2020. Our cash balance at the end of the quarter was $556.9 million.

Our cash balance at the end of the quarter with $556.9 million. Please turn to slide 22.

As we look ahead, our Q2 demand growth commercial initiatives and leading indicators give us confidence in driving volume growth in the second half of the year.

Elena Ridloff: Please turn to slide 22. As we look ahead, our Q2 demand growth, commercial initiatives, and leading indicators give us confidence in driving volume growth in the second half of the year. From a growth net perspective, we've observed a shift in our pair mix this year with a greater proportion of

From a gross to net perspective, we've observed a shift in our payer mix. This year with a greater proportion of volume from 340, B institution, who are eligible for statutory discount.

As a result of this shift we now expect growth to net for the full year to be approximately 20% versus our previous estimate of high teens.

Elena Ridloff: Another proportion of volume comes from 340B institutions who are eligible for statutory discounts.

We are reducing our net sales guidance for the year to be in the range of 480 for $515 million as a result for the continuing impacts of the pandemic and a higher gross to net.

Elena Ridloff: As a result of this shift, we now expect growth to net for the full year to be approximately 20%.

On the expense side for 2021, we are decreasing our GAAP R&D guidance to be between 250 and $270 million for the full year from the previous range of 208 is $300 million. This includes approximately $25 million in stock based compensation expense.

Elena Ridloff: 20% versus our previous estimate of high teens.

Elena Ridloff: We are reducing our net sales guidance for the year to be in the range of $480 to $515 million as a result of the continuing impacts of the pandemic and higher growth to net. On the expense side, for 2021, we are decreasing our GAAP R&D guidance to be between $250 and $270 million for the full year from the previous range of $280 to $300 million. This includes approximately $25 million in stock-based compensation expense. We are reiterating our gap SG&A between $385.

We are reiterating our GAAP SG&A between $385 million to $415 million for this for all year. This income.

For the $50 million of stock based compensation expense.

With that I'll turn the call back over to Steve.

Thank you Elena please turn to slide 4.

In closing on the commercial front, we continued to execute in a challenging environment.

In the short to intermediate term, we expect to continue to grow despite these conditions.

Looking from the intermediate to long term.

Constant and the potential for NUPLAZID and are committed to getting it to the PDP patients who desperately need it.

Elena Ridloff: to $415 million for the full year.

Elena Ridloff: This includes $50 million of staff-based compensation expense. And with that, I'll turn the call back over to...

Regarding DRP, we look forward to continuing our discussion with the FDA to align on a potential path to a resubmission.

We're focused on advancing our development pipeline with 2 clinical data readouts in the fourth quarter of 2021, while continuing to pursue attractive business development deals.

Elena Ridloff: Thank you, Elena. Please turn the slide on.

Stephen R. Davis: In closing, on the commercial front, we continue to execute in a challenging environment. In the short to intermediate term, we expect to continue to grow despite these conditions. Looking from the intermediate to long-term, we are fully confident in the potential of nucleosides and are committed to getting them to the PDP patients who desperately need them. Regarding DRP, we look forward to continuing our discussions with the FDA to align on a potential path to resubmission.

Finally, I would like to thank our employees for their passion to our mission to elevate line.

I'll now open up the call for questions.

Operator.

Certainly ladies and gentlemen, if you have a question at this time. Please press Star then 1 on your Touchtone telephone if for your question has been answered and you'd like to remove yourself from the queue. Please press the pound key.

Our first question comes from the line of.

Cory <unk> from Jpmorgan your question please.

Hi, This is gavin on for Cory Thanks for taking our question just curious.

Stephen R. Davis: We're focused on advancing our development pipeline with two clinical data readouts in the fourth quarter of 2021, while continuing to pursue attractive business development. Finally, I would like to thank our employees for their passion for our mission to elevate. I'll now open up the call for questions. Operator.

For the FTA clarify what particular analysis needs to be completed to convince them or what do you think you can show them to be convincing thank you.

Yes, I think thanks for the question Gavin sorry.

Or do you want to take this.

Yes, thanks, Kevin.

Yes.

We brought to the type a meeting a number of additional analysis well.

Operator: Certainly, ladies and gentlemen, if you have a question at this time, please press star and then one on your touchtone telephone. If your question has been answered, and you'd like to remove yourself from the queue, please press the power... Our first question comes from the line of... Corey Cozumel from J.P. Morgan. Your question, please. Hi, this is Gavin on behalf of Corey.

Debt.

We looked at the meeting as an opportunity for us to address some of the questions and concerns expressed in the <unk>. We didn't have opportunities prior to the day is to bring goods. So the analyses that we brought in where.

Oh quite.

Quite a bit of interest to the.

Sure.

F D a.

Could be summarized in a couple of buckets 1 is as it relates to the.

Gavin: Thanks for taking our question. Just curious, um, does the FDA clarify what particular analysis needs to be completed to convince them? Or what do you think you can show them to be convincing?

Clinical characteristics and features of site causes.

Along with deeper in dementia subtypes, we analyze specifically.

Stephen R. Davis: Thank you. Yeah, thanks. Thanks for the question, Gavin. Serge, do you want to take this?

We analyzed and looked at.

So it causes rating scales and.

Serge Stankovich: Yes, thanks, Gavin. We brought to the Type A meeting a number of additional analyses that, you know, we looked at the meeting as an opportunity for us to address some of the questions and concerns expressed in the CRL as we didn't have an opportunity prior to this to do so. So the analysis that we brought and was of quite a bit of interest to the FDA could be summarized in a couple of buckets.

Good variety of different cluster analysis.

To my knowledge is characterizing as.

Clinical picture of psychosis.

Among the different subtypes winter.

Winter before treatment in the course of the 3 men as well as following withdrawal of success for treatment essentially showing a very similar pattern of clinical characteristics in behavior. Among business day program subtypes. So that's 1 bucket of analyses the other buckets is really.

Serge Stankovich: One is as relates to the clinical characteristics and features of psychosis among the different dementia subtypes. We analyzed specifically, we analyzed and looked at psychosis rating scales and did a variety of different cluster analysis, and item analysis, characterizing this clinical picture of psychosis among different subtypes, whether before treatment, in the course of treatment, as well as following withdrawal of successful treatment, essentially showing a very similar pattern of clinical characteristics and behavior among these different subtypes.

<unk>.

Meaningful clinically meaningful response, not only overall among the day for among.

Among patients with dementia related psychosis, but also when you look at the pattern of response and the meaningfulness of the response among the different subtypes, particularly when you look at the.

Our response to pay my bias or interest when we see quite a bit of.

Serge Stankovich: So that's one bucket of analysis. The other bucket is related to the meaningful, clinically meaningful response, not only overall among patients with dementia-related psychosis, but also when you look at the pattern of response and the meaningfulness of the response among different subtypes, particularly when you look at the response to Pima-Banzer in treatment, we see quite a bit of similarity and meaningfulness in that clinical response. So we perform a number of different analyses demonstrating that as well.

Similarity and meaningfulness in that clinical response, so we perform a number of different analysis demonstrated that as well.

So those were kind of the main features from the analysis that we perform and presented to FDA and we'll continue to discuss as we move forward with our discussions.

Okay. Thank you very much.

Thank you. Our next question comes from the line of Neenah retail Garg. Your question. Please from Citi.

Serge Stankovich: So those were kind of the main features of the analysis that we performed and presented to FDA, and we'll continue to discuss as we move forward with our discussion. Okay, thank you very much. Thank you. Our next question comes from the line of Neena Bitritto Garg. Your question, please, from Citi.

Hey, guys. Thanks for taking my question.

Just on the DRP indication as well.

I guess have you gotten a sense from the FDA around if you are able to kind of move forward with some additional analysis of the existing data would a re filing or a re submission can be for a broad indication or do you think it would be for specific subtype.

Neena Marie Bitritto: Hey guys, thanks for taking my question. So just on the BRP indication as well. I guess you have gotten a sense from the FDA?

Okay.

Thanks, so much for the question.

Sir do you want to address this.

Neena Marie Bitritto: Question from the FDA around, you know, if you are able to kind of move forward with some additional analyses of the existing data, would a refiling or a resubmission kind of be for the broad indication, or do you think it would be for specific subtypes only? Thanks so much for the question. Sir, do you want to address... Yes.

Yes, well thanks for the question when we look.

Look at the discussions that we have and the potential pods that are essentially boils down to 3.

PA part ways that we can pursue 1 is.

Net.

Additionally, an analysis and discussion and review of the day.

Serge Stankovich: Well, Neena, thanks for the question. When we look at the discussions that we have had and the potential paths, it essentially boils down to three pathways that we can pursue. One is that additional analysis and discussion and review of the data results in the alignment that the existing data is sufficient for approval of the broad DRP indication. The other option is that the data that we have for the subtypes, particularly for some of the larger subtypes that we have, like Alzheimer's disease psychosis, along with the study in Alzheimer's disease psychosis that we have, with the analysis and data that we present, we conclude that that data is sufficient for the approval of individual subtypes without additional clinical work.

Bob.

<unk> with the alignment the day.

For the existing day, there is sufficient for approval of the broad DRP indication.

Other option is that the data that we have.

For the subtypes, particularly for some of the larger subtypes that we like.

Alzheimers disease psychosis.

Along with the study in Alzheimer's disease psychosis that we have.

Uh huh.

With with the analysis and David would we present, we aligned that our debt day, there is sufficient to for the approval of individual indication slightly individuals' subtype.

Without additional.

Clinical work and finally, the third part would be that if.

Serge Stankovich: And finally, the third part would be that if FDA remains steadfast with their position that they want to see additional clinical data, then additional work in an individual indication would be required to move forward. So that's how we see it. Obviously, our position is for the first or the second option. And I think the data that we've presented has received some traction, and we're continuing the discussion, and we're happy to have that opportunity. Yeah, this is this is Steve.

EBITDA remains steadfast with their.

Position that they would.

Want to see additional clinical data and additional work in an individual indication would be required to move forward. So that's how we see obviously our position is Florida first or the second option and I think the data that were presented.

Received some traction and we're continuing discussion and we're happy to have that opportunity.

Perfect.

This is this is Steve I don't know if other surgeries, but.

Stephen R. Davis: I don't know if others heard this, but there was some skipping when Serge was talking. So I just want to clarify. So, as Serge mentioned, there are three potential ways this could play out. First is our position that our existing data supports a broad TRP layer. We made that case in the top eight meeting we had, and we determined that we need to continue the discussion on that front. So that's one possibility. Another possibility is to resubmit based upon one or more individual subtypes. As Serge mentioned, Alzheimer's disease psychosis is where we obviously have the greatest amount of data.

There was some skipping.

When surge was talking so I just wanted to I just want to clarify so as Serge mentioned theres 3 potential ways. This could play out.

First is.

Our position that.

Our our existing data supports a broad DRP label.

We made debt piece in the type a meeting where half and we determine that we need to continue the discussion on that front. So thats 1 possibility.

Another possibility.

Is to resubmit.

Based upon 1 or more individual subtypes as Serge mentioned, Alzheimer's disease psychosis, where we obviously would have the greatest amount of data and it was the largest group in this study relative very compelling data in dementia with lewy bodies second potential outcome here.

Stephen R. Davis: It was the largest group in the study. We also have very compelling data on dementia with a lewd body. So a second potential outcome here is that we resubmit again without additional clinical work based upon one or more subtypes. The third possibility, of course, is that the FDA, and this is their current view, requires that we do additional clinical work and submit on individual subtypes. Having said that, again, here too, they said this is what we suggest you do, we think this is your best path forward, but we're willing to have a further discussion with you about the possibility of submitting without additional clinical testing. That's where things stand today. Those are the three potential outcomes.

Is that we resubmit again without additional clinical work based upon 1 or more sometimes.

Third possibility of course is that the FDA and this is their current view for.

Requires that we do additional clinical work and submit on individuals' subtypes.

Having said that again here too. They said this is what we suggest you do we think is your best path forward, but we're willing to have a further discussion with you about the possibility of submitting without additional clinical work.

Where things stands day those are the 3 potential outcomes as we see it.

Great. Thank you.

Thank you. Our next question comes from the line of Jeff Hung from Morgan Stanley. Your question. Please.

Jeff Hung: Thank you. Thank you. Our next question comes from the line of Jeff Hung from Morgan Stanley.

Thanks for taking the questions.

Just to clarify pits follow up meeting with the FDA is this a meeting where the agency will make a final decision on whether to allow for the resubmission without the additional clinical study or is there a potential that this could go on to multiple additional meetings.

Jeff Hung: Your question, please. Thanks for taking the question. Just to clarify, for the follow-up meeting with the FDA, is this a meeting where the agency will make a final decision on whether to allow for the resubmission without the additional clinical study, or is there potential that this could go on to multiple additional meetings? That was a follow-up. Yeah, Serge, do you want to take that?

Net a follow up on that.

Yeah, So John you want to take them.

Yeah.

Just to clarify I mean type a meeting that we already had with the EBITDA 60 minutes meeting.

Obviously, we brought up a lot of information and data to debt meeting I need to break briefing documents. So the extension of this meeting that we will have in the next.

Serge Stankovich: Yeah, just to clarify, I mean, Type A meetings that we already had with the FDA, 60-minute meetings, and obviously, we brought a lot of information and data to that meeting and in the briefing document, so the extension of this meeting that we will have at the next scheduled meeting is essentially a continuation of the discussion that we already had, that we had already started and had with the FDA. We do anticipate that we will come to a certain point of alignment with the FDA or a certain point of understanding what will be necessary along the three different pathways that we just discussed at the next meeting and, obviously, are hoping that the data that we're bringing and the discussion at the meeting will support our position and proposals on how to move forward. Okay, thanks.

Scheduled meeting is essentially continuation of the discussions that we already have.

They already started and had with the with the EBITDA we do.

The anticipated debt, we will come to a certain.

Point total alignment.

With the FDA or just certain point of understanding what will be necessary along with the 3 different pathways that we just discussed and then add debt next meeting.

And obviously our.

I'm, hoping that the data that we're bringing in the discussion at the meeting will.

Of course, our position.

Proposals how to move forward.

Okay. Thanks, and if I can clarify. So then can you provide a little more color on the FDA reiterating their position and being open to having another meeting like was that more that theyre pretty firm on their position, but they'll hear you out or does it seem like theyre more open to an actual discussion.

Stephen R. Davis: And if I can clarify, can you provide a little more color on the FDA reiterating their position and being open to having another meeting? Like, was that more that they're pretty firm on their position, but they'll hear you out? Or does it seem like they're more open to an actual discussion? I'll start and then I'll let Serge add additional color if he'd like.

I'll start and then I'll, let Serge.

I had a different color good luck.

Stephen R. Davis: I don't think they would have suggested, you know, we're open to having another meeting if they weren't interested in hearing more of the analysis that we're doing, that we did for the type of meeting, and we're continuing to refine that. So I think they were being genuine when they agreed to have a further dialogue. As Serge mentioned, the type A meeting was only a 60-minute meeting.

I don't think they would have suggested we're <unk>.

And having those meetings.

Werent interested in hearing more of the analysis that we're doing that we did for the type a meeting and we're continuing to refine that so I think I think they're being genuine when they agreed.

Agreed to have further dialogue as Serge mentioned.

The topic meaningless was only 60 minute meeting we can only cover so much ground in that meeting.

Stephen R. Davis: We could only cover so much ground in that meeting. Having said that, again, I just want to be clear. They said, "We believe your best path forward is to do additional clinical work and do an additional clinical study for each subtype that you want to pursue. But we're open to having further discussion." That's as much clarity as I can give you at this point. We need to have the next meeting in order to try to get further clarity. All right, thank you. Thank you. Our next question comes from the line of Ritu Baral from Cowan.

Having said that again I just want to be clear.

They said we believe your best path forward is to do additional clinical work and do an additional clinical study for each subtype that you want to pursue.

But we're open to having further discussions that's as much clarity as I can give you at this point we need to have the next meeting in order to try to get further clarity.

Alright, thank you.

Thank you. Our next question comes from the line of Ritu barrel from Cowen Your question. Please.

Hi. Thank you. This is lyla on for Ritu. Thanks for taking the question, maybe just to follow up on DRP.

Lila: Your question, please. Hi, thank you. This is Lila on for two.

The meeting that you plan to have with the FDA. Later this year now is that expected to be for the same reviewer sustained members of the FDA you've been interacting with or is there any potential that it might escalate tomorrow senior members of a day.

Lila: Thanks for taking the question. Maybe just to follow up on DRP, for the meeting that you plan to have with the FDA later this year. Now, is that expected to be with the same reviewers, the same members of the FDA you've been interacting with? Or is there, you know, any potential that it might escalate to more senior members of the FDA? Sir, do you want to take that?

Thank you.

Serge you want to take that.

Yes.

Let me just say that we first of all we were very pleased to have.

Strong FBA representation and presence at our type a meeting along both from Dolby vision.

Serge Stankovich: Yes, let me just say that we were very pleased to have a strong FDA representation and presence at our Type A meeting, along both from the division as well as from the Office for Neuroscience. At the meeting, you know, obviously the Division Director, Psychiatry Division Director, Tiffany Faccioni, was present, but also the Director of the Office for Neuroscience, Billy Dunn, was present at the meeting. So we anticipate as we continue this discussion to continue to have that strong presence from the FDA side as well and continue our constructive dialogue. Thank you for coming.

As well as from the office for neuroscience at the meeting.

Obviously the.

Davidson.

For the Psychiatry Division director to predict for Xiaomi was present, but also the director of losses for neuroscience really done was present at the meeting. So we anticipate as we continue this discussion to continue to have that strong.

Our presence from the FDA side as well and.

And continue our constructive dialogue.

Thank you for cash.

Thank you. Our next question comes from the line of Charles Duncan from Cantor Fitzgerald. Your question. Please.

Yeah.

Yeah, Hi, Thanks for taking the question had a question 1 additional question on DRP and then and then a commercial question.

Operator: Thank you. Our next question comes from the line of Charles Duncan from Cancer Fitzgerald. Your question... Yeah, hi, thanks for taking the question. I had one additional question on DRP and then a commercial question.

That is regarding DRP I guess I'm wondering if you're contemplating actually initiating a trial with 1 of these.

Charles Cliff Duncan: And that is regarding DRP, I guess. I'm wondering if you're contemplating actually initiating a trial with one of these, you know, patient subgroups. And then, given the kind of perspective that you got from AAIC, I'm wondering if you can provide any additional color on why you think the psychiatry division is contemplating there being differences in psychoses across these degenerative disorders. Sir, do you want to take this question?

Patient subgroups and then given the kind of perspective that you got from a I see I'm wondering if you can provide any additional color on why you think the psychiatry division is contemplating.

There being differences in psychoses.

Has he said degenerative disorders.

So do you want to take this question Bill.

Yes.

Let me try to address.

For the first part.

Serge Stankovich: Yes, let me try to address the first part of the question, the second part of the question, and that is, you know, we received quite a bit of support from the medical community out there in regard to interpretation of the data and the results of our Harmony study and the overall data that we submitted as part of our supplemental NDA. So there is indeed, as you are pointing out, a little bit of discrepancy in the way the Division of Psychiatry looked at the data and how the wider medical and scientific community looked at the data.

The.

Second part of the question and that is.

We.

Received quite a bit of support from the medical.

Community out there in regard to interpretation of the data and the results of our harmonious study and the overall data that we that we submitted as a part of our supplemental anda. So there is indeed as youre pointing out a little bit of a discrepancy.

The way, how Oh, how division of psychiatry looked at the data and how the wider medical and scientific community. If you look at the data we were ready as I mentioned very pleased with the fact that we also.

Serge Stankovich: We were very, as I mentioned, very pleased with the fact that we also published the data in the New England Journal of Medicine and received a positive editorial in regard to the overall data we have. But it remains a debate within the community about how to study dementia-related psychosis, to study it as a single entity, clinical entity, which is a position where we have been, and we have an agreement to that effect, or to study it by dementia subtypes.

Published other beta in the New England Journal of Medicine and received also.

Positive editorial in regards to the overall data we have but it is a remains a.

Hey.

Within the community about how to study dementia related psychosis studied as a single entity.

Clinical entity, which is positioned where we had and we had an agreement to debt effect or 2 studies by dementia subtypes.

Serge Stankovich: And I guess that the Division of Psychiatry, on the basis of available data to them and the data that we presented, came to the conclusion that this way of studying psychosis by dementia subtypes is an appropriate way to study dementia-related psychosis. But that's the best that I can say. Charles, I think you also were asking about running an additional study, and yeah, I would just say, yeah, go ahead.

And I guess the debt.

The division of psychiatry on the basis of available data to Dan and the data that we presented came to conclusion that debt way of studying psychosis by dementia subtypes is inappropriate.

Inappropriate way to study of dementia related psychosis.

That's the best that I can say.

Charles I think you also were asking about outrunning us running an additional study in yes, I would just say.

Yeah, Yeah, sorry go ahead Sir.

Serge Stankovich: We are obviously preparing for all possible alternative outcomes of our discussion. We do not want to prejudge the discussion, but we are prepared for all possible outcomes and alternative actions that we would be taking as we move forward with this. So that's how we look at things.

Yes, we are obviously preparing for all possible alternative outcomes of our discussion we do not want to.

Pre judge the discussion or but we are prepared we are preparing for all possible outcomes alternative ax.

<unk> that we would be taking as we move forward.

With it so so that's the.

That's how we will look for other things.

Stephen R. Davis: Okay, quick commercial question then, and I know that you don't, you know, promote off-label, but I'm just wondering if you're able to detect any change in the use of Pima-Vancerin off-label as a result of the agency decision and the visibility around that. I don't even know if there is off-label use, but I'm wondering if that, if there From the time we launched in PDP, we've had very little off-label. We can't track every bottle. We don't know the final destination of every bottle. For instance, it goes into long-term care.

Oh, Okay quite a commercial question then.

And I know that you don't.

Promote off label, but I'm, just wondering if you're able to detect any change in the use of Pima Vance for an off label as a result of the agency decision and <unk> and the visibility around that I don't even know if there is off label use but I'm wondering if that.

If there is if that dynamic changed over the course for the second quarter.

Yeah. Thanks for the question Charles.

From the time, we've launched in PDP, we've had very little off label use we can't track every bottle. We don't know the final destination of every bottle for instance, it goes into long term care, but.

Charles Cliff Duncan: But the majority of our sales of our bottles come through our hub, and we know what the diagnosis is for every bottle, every prescription that comes through our hub. And when we look at those prescriptions... The amount that is off-label has consistently been in the low single digits, so more than 95% of prescriptions are online. It's difficult to get the drug off-label as it is a mini drug. It's possible, but it's difficult.

But the majority of our sales of our bottles come through our hub and we know what the diagnosis is on every bottle every prescription that come through our hub and when we look at those prescriptions.

The amount that is off label has consistently been in the low single digits, so more than 95%.

Prescriptions are on label it's.

It's difficult to get the drug off label it as many drugs.

It's possible, but difficult and so for that reason.

Charles Cliff Duncan: And so for that reason, a very high percent of our, www.facebook.com or www.youtube.com OK, thanks, Steve, for the added color. Yeah, too bad. Thank you. Our next question comes from the line of Tazeen Ahmad from Bank of America. Your question, please.

Very high.

Percentage of R. R.

Our bodies are on label that has not changed throughout the life cycle of the other product and we're not seeing any differences from that today.

Okay. Thanks, Steve for the added color.

Yes, you bet Charles.

Thank you. Our next question comes from the line of <unk> Ahmed from Bank of America. Your question. Please.

Tazeen Ahmad: Hi, good afternoon. Thanks for taking my question. Guys, I just wanted to maybe clarify the comment that you made in your prep statement about breakthrough status. I guess why would it be the case that FDA might be reconsidering breakthrough and who's going to do it.

Hi, good afternoon, Thanks for taking my question.

So I just wanted to maybe clarify on the comment that you made in your profit statements.

Statements SaaS breakthrough status.

I guess why would it be the case at etsy might be reconsidering breakthrough and who's going to make that decision as you kind of have these meetings.

Tazeen Ahmad: If you're going to make that decision, as you kind of have these meetings, your next meeting, is anybody in that committee going to be involved in that?

Your next meeting is anybody in that committee is going to be involved in determining breakthrough status and as and when its determine what the future path is going to be let's say, let's.

unknown: https://www.academia.com

Serge Stankovich: Let's say the best case scenario is that you don't have it. Does the chance now go up that it would be for a regular review given the breakthrough status might be revoked? Yeah, sure. Sir, do you want to take it?

Let's say the best case, you don't have to do another study you can resubmit theres a chance now go up that it would be for a regular review given the breakthrough status might be revoked Inc.

Sure Serge ones I guess.

Serge Stankovich: Yeah, a couple of things here. First of all, just a clarification. We received this notification from the FDA prior to our Taipei meeting. And the breakthrough designation at this point, you know, the reason we believe this is consistent with their CRL is that it's very consistent with their position that the data did not substantiate approval for this particular indication. And at this point in the life cycle of the development, the breakthrough therapy designation really does not have as much of an impact as it otherwise would have.

Yes, a couple of things here first of all just for clarification.

We received this notification from the EBITDA prior to our type a meeting and the breakthrough.

The designation at this point.

The reason we we.

I believe this is consistent with their CRA Ali is it's very consistent with their position debt.

For the data did not substantiated approval for this particular indication and at this point in the lifecycle of the development are.

It really debt.

The breakthrough therapy designation. It does it does not have an impact as it otherwise would have so from that perspective.

Serge Stankovich: So from that perspective, this is something that we are not surprised to see. And in regard to the review, which is an important point, in the case of resubmission, that resubmission goes either to, depending on whether it's a labeling resubmission or it's additional data, which in this case would probably be, would take six months in the review cycle, so it wouldn't go, it doesn't go in a

This is something that we were not surprised to see.

The.

To your question the deviation Rick makes a recommendation for the breakthrough therapy designation and then approved by the higher levels with the agency and in regards to the review, which is important point in case of Resubmission debt Resubmission goes either too.

Depending on whether its a labeling.

Resubmission or it's a additional data which in this case would probably be woods.

Would take 6 months review cycle. So it wouldn't go he doesn't go away.

Or like Oh original submission.

Jason Nicholas Butler: Okay, I got it. Thank you. Thank you. Our next question comes from the line of Jason Butler from JMP Securities. Your question, please. Hi, thanks for taking the questions. Just on the DRP, was the phase two ADP study discussed at all, or any of the FDA's comments in the CRL relating to that study discussed? And then, just on the commercial side, in geographies where the case rates of COVID have remained lower, are you seeing a better return to physicians' offices or occupancy levels in LTC that are closer to normal? Are you seeing different things across the country, or is it still depressed across the country?

Okay got it thank you.

Yeah.

Thank you. Our next question comes from the line of Jason Butler from JMP Securities. Your question. Please hi, thanks for taking the questions.

Just on the DRP was the phase 2.

ADP study discussed at all or any of the Fda's.

Comments from the CRM relating to that study discussed and then just on the commercial side.

In geographies, where the case rates of Covid have remained lower are you seeing a better.

Return to physicians offices or or occupancy levels in LTC that are closer to normal I E are you seeing different things across the country or is it still depressed across the country.

Jason Nicholas Butler: Thanks. George, why don't you take the first question? Yes.

So why don't you take the first question, yes, yes.

Thanks, Jason.

Serge Stankovich: Yes, thanks, Jason, um, The FDA invited us to bring additional data and analysis. The point that we brought to the meeting in the discussion as far as the Phase II ADP study goes is that the positive conclusions of that study remain regardless of how you look at the data and analyze the data and independent of any concerns that the division expressed in regard to some quality issues with that study, single center studies, and so on.

Yeah.

M D a.

Invited us to bring additional data.

Data and analysis.

The the point that we brought to the meeting and the discussion as far as the phase II. ADP study goes is that the conclusion positive conclusions of that study.

Remained regardless of how you look at the data and analyze the data and independent on any concerns that the division. The express in regard to some quality issues with that study a single center study and so long so from that perspective, they did invite us to bring.

Serge Stankovich: So from that perspective, they did invite us to bring that additional analysis and data validating the overall conclusion of that study because it is an important study in the overall package of the data we show. All right, thanks so much. Amanda, do you want to take the geography question? Yeah, thanks. I'll take the second question. Thanks, Steve.

Debt additional analyses and data validating the overall conclusion of that study because it is important studying the overall package of a debate that we submitted.

Alright, thanks, so much Amanda you want to take the geography question.

Yes, Thanks, I'll take the second question. Thanks, Steve.

Amanda Morgan: So specific to are we seeing, you know, differences across the US as it relates to the pandemic? And we do see regional differences across the US. But what I will say is that, from the beginning of the year until this year, we've seen a return of face-to-face engagements with our reps and our physicians, and we've seen LTC new admissions continue to grow, although still at pre-COVID levels.

Specific to our we're seeing you know differences across the U S. As it relates to the pandemic and we do see regional differences across the U S. But what I will say is that we have seen.

From the beginning of the year until this year, we've seen a return of our face to face engagements with our breadth and our position and we've seen LTC.

Admissions continue to grow although still at pre COVID-19 levels.

Amanda Morgan: As well as PD patient office visits, so we'll continue to track those leading indicators and continue

As well as PD patient office visits.

We will continue to track those leading indicators and continue to optimize with our engagements with our ATP as we navigate the pandemic.

Amanda Morgan: and continue to optimize our engagements with our HGPs as we navigate the pandemic. Got it. Thanks for taking the time to answer the question. Thank you. Our next question comes from the line of Mark Goodman from SVB Leerink. Your question, please. Yes, hi. So, Steve, to confirm, if the FDA ends up saying, okay, you need another study, are you willing to do another study in one of these subgroups? Is that confirmed?

Got it thanks for taking the questions.

Thank you. Our next question comes from the line of Marc Goodman from SVP Leerink. Your question. Please.

Yes, hi, Steve to confirm if the F. D. A ends up saying, okay. We need another study youre willing to do another study in 1 of these subgroups.

That confirmed.

Mark Goodman: Yeah, no, I appreciate the question, Mark. I think the honest answer is, We need to know what would be required for approval in any of the individual subgroups, or for that matter, for DRP generally. And we just haven't had it; we're not at that point in the discussions yet. So we need to understand what that path looks like. Obviously, if it's a path that, if we ultimately determine that we need to do additional clinical work to get an approval, if the path is one that we feel like is appropriate, and it's scientifically valid, we still have a lot of patent life, and we'll be eager to pursue it. If the path forward is one that we feel like is just not feasible, it'd be very difficult to enroll, or take a very, very long time to enroll, then you'll have to take that into consideration.

Yeah No I appreciate the question Mark I think the honest answer is.

We need to know what would be required.

For an approval in any of the individuals subgroups or for that matter for DRP generally and we just haven't had we're.

We're not at that point in the discussions yet so we need to we need to understand what that path looks like obviously, if it's a path that debt. If we if we ultimately determined that we need to do additional clinical work to get an approval.

If the path is 1 that we feel like is appropriate.

Scientifically.

Valid we still have a lot of patent losses will be eager to pursue it.

If this is the path forward is 1 that we feel like is just not feasible would be very difficult to enroll or it takes a very very long time to enroll than you want to take that into consideration but.

Stephen R. Davis: But, you know, the next step's next. The next thing we need to do is have a further discussion. So basically, at the meeting, they told you that you should do another study in a subgroup to get that particular subgroup, but they didn't give you any guidance on that type of study at all. There was no discussion about what it would be like. We did not have a discussion about what that would look like.

Next steps next week. The next thing we need further discussion with FDA.

So basically at the meeting they told you that you should do another study in a subgroup to get that particular subgroup, but they didn't give you any guidance on that type of study at all there was no discussion about what it would be.

We did not have a discussion on what that would look like that's correct.

Stephen R. Davis: That's correct. We spent the majority of the meeting talking about the new analysis that we had done and had a dialogue around that. And, you know, again, as I said, I want to be really clear. They said, we think your best path forward is to do additional clinical work. However, we're willing to have a further discussion with you to further consider the analysis that you've done.

Majority of the meeting talking about the new analysis that we had done.

And had a dialogue around that.

And.

Again.

So it won't be really clear.

We think your best path for us to do additional clinical work. However, we're willing to have a further discussion with you too for.

Further.

Consider the analysis that you've done.

Serge Stankovich: And Serge, your comments, somewhere in the comments, you use the term some traction. We got some traction. So I was just curious, what part of the discussion was it that you got some traction on? Thank you. Well, I would just directly say the buckets that I described and both sets of analysis that we were discussing were received with quite a bit of interest. This was new information, new data that we brought, new analysis, and there was quite a bit of interest and discussion, and finally, encouragement to see more of that analysis and continue discussion. That is the reason that I characterized as an attraction, but really relates to both buckets of the analysis.

Right and search your comment somewhere in the comments you used the term some traction we got some traction so I was just curious.

What part of the discussion was it that you got some traction thank you.

Well.

I would just directly say the buckets that I described both sets of analysis that we were discussing were received with a quite a bit of interest. This was new information that the new data that we brought a new analysis and there was quite a bit of interest.

In discussion and.

Finally encouragement to.

See more of that analysis.

And continued discussion and debt, but that is the reason that I characterized as the subtraction, but really relates to both buckets all of the analysis.

Stephen R. Davis: Mark, I might just add one additional comment. You know, anytime you get a CRL, and we were very clear about this before the top meeting, you know, you would expect that going into that meeting, because they just issued a CRL, that their view would be that you should do additional clinical work. So I would say we're very pleased that both Dr. Farshione and Dr. Dunn were at the meeting, and we had an opportunity to present the analysis that we did.

Alright, thank you.

Mark I might just add 1 additional comment.

Anytime you get a CRA all in we were very clear about this before the type a meeting.

No.

You would expect that going into that meeting because they just issued a CRM.

That their view would be that you should do additional clinical work.

I would say, we're very pleased that both our doctor partially on the Doctor done were at the meeting.

And we had an opportunity to present the analysis that we did.

Stephen R. Davis: And as Serge mentioned, I think there was a very meaningful interest in the analysis, and we had a very constructive dialogue. So, coming out of that, with the recognition that this warrants further discussion, I think that's what Serge is referring to when he said, you know, we got some traction, and I feel like we had a productive discussion, and now we need to continue that dialogue. Thank you. Our next question comes from the line of Thalvian Richter from Goldman Sachs. Thanks for taking our questions.

And Serge mentioned I think there was a very meaningful interest in the analysis and we had a very constructive dialogue.

So I think coming.

Coming out of that meeting.

With the recognition that this warrants further discussion.

I think as what searches referring to when he said.

We've got some traction and Uh huh.

For like I said, a productive discussion that we need to continue that dialogue.

Thanks.

Thank you. Our next question comes from the line of Salve in Victor from Goldman Sachs. Your question. Please.

Thanks for taking our question. This is Andrew on for Zalviso Elena maybe 1 for you with respect to the lowered guidance. There can you help us understand what proportion of that reduction is due to expected continued impact from the pandemic versus credit can add.

Andrea: Thanks for taking our questions. This is Andrea from Salveen. Elena, maybe one for you with respect to the lowered guidance there. Can you help us understand what proportion of that reduction is due to expected continued impact from the pandemic versus gross to net? Sure, Andrea. So about half the reduction is a result of the slower pace of recovery due to the pandemic.

Sure Andrea.

So about half the reduction is a result.

Slower.

Slower pace of recovery due to the pandemic in the back half of it is due to the growth from that.

Andrea: and about half of it is due to the growth in that. Great. And then third,

Serge Stankovich: Great, and then Serge, one question on ACP 044 for the data that you're expecting in the fourth quarter of this year. Can you help frame expectations for that and what is clinically meaningful?

Great and then 1 question on ACP zero for for for the data that Youre expecting in the fourth quarter of this year.

Can you help frame expectations for that and what is clinically meaningful.

Yes, we are.

Serge Stankovich: Yes, we are conducting, just as a reminder, a study in post-surgical pain, bunionectomy surgery, about 280-240 patients and expect the results before the end of the year. In that study, the primary outcome measure is pain intensity measured over 24 hours.

Conducting just as a reminder.

Study.

And.

Post surgical pain Bunionectomy surgery.

About 280.240 patients.

Studying unexpected the results before the end of the year.

In that study the primary outcome measure is pain intensity measured over 24 hours. We are testing 2 kind of dosing regimens in the study at the highest dose level and.

Serge Stankovich: We are testing two kinds of dosing regimens in the study at the highest dose level, and, you know, it's a placebo-controlled study, so we would be very pleased to see significant All are placebo, of course. Thank you. Our next question comes from the line of Joseph Stringer from Niobe. Your question, please. Hi, everyone.

No.

Placebo controlled studies so.

We would be.

I'm very pleased to see.

<unk> separation and the pain intensity a reduction in pain intensity.

We are <unk> treatment.

Or placebo of course.

Yeah.

Thank you. Our next question comes from the line of Joseph Stringer from any company. Your question. Please.

Joseph Stringer: Thanks for taking our questions. The first one is a commercial on PDP. Just following up on an earlier question on sort of regional differences, just curious if you had any data or info on hesitancy amongst vaccinated PDP patients, whether it be returning to office visits. And I know in long-term care, a little bit different dynamic. You mentioned occupancy and new admissions were down, but is there a different sort of effect on each of those settings?

Hi, everyone. Thanks for taking my questions first 1 on commercial on PDP.

Although up on an earlier question on <unk>.

For the regional difference just curious to get any day now or info on hesitancy among.

Amongst vaccinated.

PDP patients.

Other be returning 2 office visits and I know in the long term care for a little bit different dynamic you mentioned occupancy in.

Yes.

Admissions were down but.

Is there a different.

Sort of effect for for each of those settings and then second question is just on Red.

Joseph Stringer: And then the second question is just on red. Can you remind us again what? What to expect for a clinically meaningful change in RSPQ and CGI endpoints.

Can you remind us again what.

What to expect for a clinically meaningful change in our SKU in CGI endpoints. Thank you.

Joseph Stringer: Thank you. Yeah, sure. Amanda, do you want to take the first question and charge this?

Yeah sure I mean do you want to take the first question and search for the second.

Amanda Morgan: Sure, thanks for the question Joseph. Let me kind of separate my question into two parts, or my answer into two distinct categories when we think about, you know, regional differences and how we think about the business. But it really boils down to two things.

Sure. Thanks for the question Joseph So.

Let me kind of separate my question just to kind of for my answer into 2 distinct categories. When we think about it.

Regional differences and how we think about the business, but it really boils down to 2 things and it's either the face to face physician and patient visits for.

Amanda Morgan: And it's either the face-to-face physician and patient visits, for the face-to-face physician and rep interaction, and specifically the face-to-face physician and patient visits. This is important because we know HCPs are more effective at diagnosing PD psychosis, and they have an increased willingness to prescribe a new product during an in-person patient visit. And so currently, in-person patient visits, as I shared, are about 20% below pre-COVID levels. So regardless of this, we've maintained our new patient starts pre-pandemic.

For the face to face physician and wrap interactions.

And specifically with the face to face physician and patient visit.

This is important because we know HCP is a more effective diagnosing PD psychosis and.

And they have an increased willingness to prescribe and new product during an in person patient visits and.

And so currently in person patient visits as I shared about 20% below pre COVID-19 levels.

So regardless of debt that we've maintained our new patient starts pre pandemic.

Amanda Morgan: The second thing we look at, both regionally and nationally, is face-to-face physician and rep interactions. And so what we know is that when we engage with our HCPs in person, we're just more effective than we are when we interact virtually. And so currently, more than two-thirds of our physicians and rep interactions are in person, which is a significant improvement from the beginning of the year, but it is still below the pre-COVID level. So throughout our growth initiatives, you know, the temporal headwinds, you know, turning those into tailwinds.

The second thing we look at those.

Both regionally nationally is when you look at face to face physician and rep interaction and so what we know is.

That would mean gauge with our HCP in person. We're just more effective than we are when we interact virtually and so currently more than 2 thirds of our physicians and rep interactions or in person, which is a significant improvement from the beginning of for here.

But it is still tree.

Covid level so.

Our growth initiatives that Ken for all headwinds you know turning those into tailwind we do expect to see an increased demand for NUPLAZID and we do expect that to kind of vary regionally, but.

Serge Stankovich: Transcripts by Transcription Outsourcing, LLC. Yes, about the Trophinatide RET phase 3 study. As a reminder, the study has two co-primary measures. One is the RET Behavioral Symptoms Questionnaire, which is a caregiver-completed questionnaire across symptoms of RET syndrome. And the second is the Clinical Global Impression of Improvement, which is a physician rating scale. So, in itself, the study has sort of internal validation of whether the rating scale changes that are observed in individual patients correlate with the meaningful improvement that the physician characterized on the scale on their rating scale.

Those are really the way we look at it from both the regional and National perspective.

Okay.

Yes about there.

European as I addressed that a phase III study as a reminder.

The study has 2 co primary measure 1 is red behavioral symptoms questionnaire, which is a caregiver.

<unk>.

Completed the questionnaire or across symptoms over at <unk> syndrome, and the second is clinical global impression of improvement, which is a physician.

Our ratings scale so in itself the study.

As sort of internal validation of <unk>.

Whether the rating scale changes that are observed in individual patients correlate with the improvement in meaningful improvement that the position characterized on the on the scale on their rating scale. So from that perspective, since we need to to reach boat.

Serge Stankovich: So, from that perspective, since we need to reach separation from placebo and both co-primary measures, there is internal validation of the meaningfulness of the results whenever we separate from placebo. I will remind you that in the phase 2 study that was positive, there was about a 15% reduction on the scale, and obviously that was a meaningful difference, particularly in the context of the broad assessment of the broad symptoms across RET syndrome, as well as that there are no other available treatments at this time. Great, thank you.

Our separation from placebo on both co primary measure the reason internal validation of meaningfulness of the results.

Whenever we separate from placebo I will remind you that in the phase 2 study that was positive there was about a 15% reduction on the scale.

And obviously debt that was meaningful separation, particularly in the context of the broad.

Assessment, all the broad symptoms of Cros.

Ret syndrome as well as there are no other available treatments at this point.

Great. Thank you.

Jay Olson: Thank you. Our next question comes from the line of Jay Olson from Oppenheimer. Your question, please? Oh, hey, thanks for the update and thanks for taking the question. I was wondering if you could share any thoughts on Faribault's data for their M4-PAM and any read-across that you might see to your M1-PAM.

Thank you. Our next question comes from the line of Jay Olson from Oppenheimer. Your question. Please.

Oh, Hey, thanks for the update and thanks for taking the questions. I was wondering if you could share any thoughts on Sara those data for their end for Pam and any read across that you might see to your and 1 Pam and then maybe if you could please provide an update on your latest thoughts.

Jay Olson: And then, maybe, if you could please provide an update on your latest thoughts about potential indications to pursue with your M1-PAM and when we should expect to see Phase 1 data. Thank you. Yeah, thanks much for the question, sir. Do you want to take it?

About potential indications to pursue with CRM, 1 Pam and when we should expect to see phase 1 data. Thank you.

Yes. Thanks, so much for the question Serge do you want to take net.

Yes.

Let me start with the <unk>.

Serge Stankovich: Let me start with our thinking around what potential indications for the M1M that we are currently developing. You know, we are taking, as we mentioned, in a broad stroke, we are looking at schizophrenia and the cognition and cognitive symptoms in dementia. When we talk about schizophrenia, obviously, one can pursue acute symptoms of schizophrenia but also negative symptoms and cognitive symptoms of schizophrenia.

Our thinking around what potential indications for the M..1.

That we are currently developing.

We are taking as we mentioned in our broad stroke, we are looking at the schizophrenia and the cognition and in cognitive symptoms in dementia.

When we talk about schizophrenia adversely.

Ken pursue appeals symptoms of schizophrenia, but also negative symptoms and cognitive symptoms of schizophrenia, we will be what they say following the molecule listening to the molecule as we are developing and conducting our phase 2 because there are some indications there are some.

Serge Stankovich: We will be, what they say, following the molecule, listening to the molecule as we are developing it and conducting our phase two because there are some indications that M1 is more targeted toward and successful in the treatment of cognitive symptoms, while M4 may be more successful in treating the acute symptoms. I would say that we, as much as we believe in that lore, we would also, there are, there are data that suggest otherwise, and we would like to evaluate as we move forward with the development of M1PAM. As far as the M4 data from Saravel, I would say it's impressive data.

For those that believe that and 1 is more targeted stalwart and successful in the treatment at all.

For cognitive symptoms wildly M for it may be more successful in treating the acute symptoms I would say debt.

We are as much as we we believe in debt law. We would also there are there are data that suggest a different and we would like to evaluate as we as we further move with the developmental and 1 pad.

As far as the and for.

Data from Sara well I would say, it's an impressive data it is in acute.

Serge Stankovich: It is in the acute, short-term acute treatment of positive symptoms of schizophrenia. We looked at that data. First of all, we do need better treatments for schizophrenia, so we are very pleased to see such positive results as Saravel reported, but I would also say that we are seeing that as a validation of the muscarinic receptor as a target for schizophrenia and are very, very pleased that we also have a program in development in that area. Unknown Speaker Great, thank you.

Short term acute treatment of AR positive symptoms of schizophrenia, we looked at that day to first of all we do need better treatments for schizophrenia. So we're very pleased to see.

Such a positive results as et cetera, well reported but I would also say debt.

We are seeing that as a validation of muscarinic receptor.

Target for schizophrenia, and other very were you pleased that we also.

Have a program in development in that area.

Great. Thank you.

Gregory James Renza: Q. Our next question comes from the line of Gregory Renza from RBC Capital Markets. Your question, please. Hey, Steve and team.

Thank you. Our next question comes from the line of Gregory <unk> from RBC capital markets. Your question. Please.

Gregory James Renza: Thank you very much for taking my question. Steve, just on the Type A meeting, I know coming into that meeting, you were really striving for an understanding of why the FDA appeared to have changed their position there. I'm just curious, coming out of that now, if you feel as though you've reached that understanding, and, as you allude to, kind of the alignment path forward, what that means for getting on firmer footing with the next steps.

Hey, Stephen Kim. Thank you very much for taking my question, Steve just on the type a meeting I know coming into that meaning you were really striving for an understanding of why the F. D. A appear to have changed their position. There I'm just curious coming out of that now if you have to use it felt as though you've reached that understanding and as you allude.

To kind of the alignment path forward and what that means for getting on.

Firmer footing with them with the next steps and then just secondly on a separate topic just related to BD. Just curious if you could update us on sort of your criteria day, there, especially as maybe the wider industry has been profit to rethink assets and development plans.

Gregory James Renza: And then, just secondly, on a separate topic just related to BD, just curious if you could update us on sort of your criteria there, especially as maybe the wider industry has been prompted to rethink assets and development plans following the Adekanamab approval. Thank you very much. Yeah, sure. Let me, let me take them one at a time.

Following the other candidate approval. Thank you very much.

Yeah sure let me, let me take them 1 at a time.

Stephen R. Davis: And I'll answer the first question and search again; feel free to add any additional color. Look, I think this is a situation where reasonable minds can differ. And we believe our position and the way to look at DRP broadly as one indication is supported by the data in the medical literature, in terms of the way physicians think about this, and, most importantly, in terms of the way it presents and the way it responds to treatment.

I'll answer the first question and then search again feel free to add any additional color.

Look I think this is a situation where reasonable minds can differ.

We believe our position and the way to look at the ERP broadly as 1 indication is for.

Reported by <unk>.

The data and the data in the medical literature in terms of.

The way.

Physicians think about.

This indication most importantly in terms of the way it presents and the weight response to treatment.

Stephen R. Davis: So, we feel like we've got a very strong case there. We think our data from our Harmony study is consistent and supports that position. As Serge mentioned, when you look at the drug-treated group in the randomized withdrawal portion of the study, between subgroups, the response is very similar.

So we feel like we've got a very strong case here and we think our data.

From our harmony study is consistent and supports that position.

You mentioned when you look at the drug treated group.

In the randomized.

All portion of the study.

Between subgroups the responses very similar.

Stephen R. Davis: Also, very similar in the open label portion of the study. So, however, we respect the fact that the FDA, particularly the psychiatry division, has a different position. And, you know, this is not to say that we're wrong, we're right, and they're wrong or vice versa. They just have a different position than we do.

Also very similar in the open label.

A portion of the study.

So however, we respect the fact that the FDA.

Particularly the psychiatry division has a different position.

And.

This is not to say that we're wrong, we're right and they're wrong or vice versa. They just have a different position than we did.

Stephen R. Davis: So recognizing that, our objective is to accomplish two things. One is we want to get this drug to patients who desperately need it as fast as possible. And two, we want to get it to the broadest group of patients that can benefit. So as we go forward, we're going to focus on where we can try to find alignment to accomplish those two objectives, recognizing that we just have a reasonable difference of scientific opinion.

So recognizing that our objective is to accomplish.

To accomplish 2 things 1 is we wanted to get this drug to patients who desperately need it as fast as possible and people want to get it to the broadest group of patients that can benefit from it.

So as we go forward.

Moving to focus on where we can try to find alignment.

To accomplish those 2 objectives recognizing that we just have a reasonable difference of scientific opinion.

Stephen R. Davis: George, anything you want to add to that? Oh, I think you summed it up quite well. And then, on your second question regarding BD, you broke up on, I think, a key part of the second question. Could you repeat that?

<unk> anything you want to add to that.

Oh I didn't you summed it up quite well.

Okay.

And then to your second question regarding BD, you broke up and I think a key part of the second question could you repeat that.

Sure Steve I, just I'm curious if you could just update us on the criteria that you are applying when you look at external assets and just curious if some of the attic can't even have approval while it's prompted.

Stephen R. Davis: Sure Steve, I'm just curious if you could just update us on the criteria that you're applying when you look at external assets and just curious if some of the Atacama have approval while it's prompted others in the sector to maybe rethink how to look at assets and development programs if that applies to you as well. Yeah, thanks.

Others in the sector to maybe rethink how to look at assets in development programs, if that applies to you as well. Thank you.

Stephen R. Davis: Thanks so much for the question. You know, I would say our strategy for business development is unchanged. We built a presence in both neurology and psychiatry, and we're very strong franchises there, both on the R&D as well as on the commercial and medical affairs fronts. And we're going to continue to pursue that. As it relates specifically to Educanumab, I would say that it has not had a meaningful impact in terms of our view of assets and the development paths forward.

Yeah. Thanks for thanks, so much for the question.

I would say our strategy on business development is unchanged.

We built a presence in both neurology and psychiatry.

We're very strong franchises there both on the R&D as well as on the commercial and medical Affairs fronts.

And we're going to continue to pursue that as it relates specifically to <unk>.

I I would say that has not.

It had a meaningful impact in terms of our view of assets and the development paths forward.

Stephen R. Davis: Having said that, I'll say, you know, we obviously, this is a topic of great discussion in the general press. There are, you know, probably political points of view, social points of view, and medical points of view that relate to how the FDA is currently thinking about the accelerated approval pathway. And we'll continue to stay very much on top of that. But I would say when I step back and think about the things that are most impactful to our strategy for business development, this is not a sea change or significant difference. Thanks, Steve. Thank you. We have time for two more questions. Our next question comes from Danielle Brill from Raymond James. Your question, please.

Now, having said that I'll say, we obviously.

Does it.

A topic of great discussion.

General price.

There is.

Probably a political point of view and social point of view the medical point of view that that relate to how the FDA is currently thinking about the accelerated approval pathway and we will continue to stay very much on top of that but I would say when I step back and think about the things that are most impactful for our strategy on business development.

It is not a just does not create a sea change for a significant difference.

Thanks, Steve.

Yes.

Thank you we have time for 2 more questions. Our next question comes from the line of Danielle Brill from Raymond James Your question. Please.

Danielle Brill: Hi guys, thanks so much for the questions.

Hi, guys.

So much for the question this.

Danielle Brill: This may be a follow-up to the one just asked, but maybe just if you could clarify a bit. Steve, it seems like there's nothing preventing us from having another meeting with the FDA. So I guess, can you just walk us through exactly what the next steps are from here to get that meeting scheduled?

Just maybe a follow up to that 1 just asked but maybe just if you could clarify a bit seen it seems like there is nothing gating to having another meeting with the FDA. So I guess can you just walk us through exactly what the next steps.

From here to get that meeting scheduled and then on the commercial side and I'm curious if you have any insight as to why PD office visits were down more than 2 key events for 2 or <unk>. When the pandemic was at all time highs. Thank you.

Danielle Brill: Why PD office visits were down more in 2Q than 4Q or 1Q when the pandemic was at all-time highs. Thank you. Yeah, thanks. I'll ask Amanda to answer the second question in a second. But as it relates to the first question, I'm sorry, Danielle, could you repeat the first question?

Yes, Thanks, I'll ask Amanda to answer the second question in a second.

As it relates to the.

Uh huh.

I'm sorry.

Danielle Brill: Yeah, I'm just wondering, like, what the steps are from here to having that follow-up discussion with the FDA?

Could you repeat the first question.

Yes, I'm just wondering like what other steps are from here to having that follow up discussion with the FDA.

Danielle Brill: So, let me just cover it kind of mechanically first. So, mechanically, we need to submit the request, and then depending on whether it's a type A, B, or C meeting, there will be a 30, 60, or 75-day clock on the meeting, and then we need to submit a briefing document 30 days before the meeting. So it's just the mechanical rules that are in place with FDA. We are working very diligently on the material that will be needed to be included in the briefing document, and we want to make certain that we have that clearly within our sights before making the request. So that's what's coming.

Got it okay I'm sorry.

So let me just cover kind of mechanically for so mechanically we need to submit submit the request.

And then depending on where Theres a type a b or C meeting it'll be 30, 60, or 75 day clock on the meeting and then we need to submit a briefing document.

30 days before the meeting so it's just the mechanical rules that are in place with FDA.

We are working very diligently on the Ah <unk>.

Material that will be needed to be included in the briefing document.

For now.

We have been clearly within our sites before making the request.

So that's coming.

Stephen R. Davis: And just as a little bit of additional context, I would say, you know, as we've reported previously, we unfortunately didn't get an opportunity to learn of the FDA's concerns in DRP that led to the CRL until we got the CRL. So we're very thankful and appreciative of the opportunity to have the type of meeting that we had and respond to those concerns. And so, as we continue this dialogue, we want to make certain that we are very responsive to their concerns and responsive to the dialogue that we're having.

And just as a little bit of additional context I would say.

As we reported.

Previously.

We unfortunately, didnt get an opportunity to learn of the Fda's concerns.

DRP that led to the CRM.

Until we got this year also so we're very thankful and appreciative of the opportunity to have the type a meeting we had and respond to those concerns.

And so.

And so as we continue this dialogue we want to make certain that we are very responsive to.

Their concerns and responsive to the dialogue that we're having.

And.

Stephen R. Davis: And so in order to do that, now that we know those concerns and have had an initial discussion with them, it's important to get this right for the next discussion as well. So that's, of course, our number one priority. Okay. I'm sorry, Amanda. Do you want to take the second question?

And so in order to do that now that we know those concerns we've had initial discussion with them. It is important to get this right for the next discussion as well. So that's the that's of course are our number 1 priority.

Yeah.

Okay, I'm, sorry, I, maybe take the second question.

Yeah sure. Thanks, Steve.

Thanks, Danielle for the question specific to PD office visits I'd, just remind you that you know we serve a PD patient population that is elderly.

Stephen R. Davis: Yeah, sure. Thanks, Steve. Thanks, Danielle, for the question. Specific to PD office visits, I just want to remind you...

Amanda Morgan: P.D. office visits. I just remind you that we serve a P.D. patient population that is elderly.

As the pandemic.

Amanda Morgan: So as the pandemic continues, this is an elderly patient population that we serve. Thank you. Thanks, guys. Thank you. And our final question for today comes from the line of Emile Devane from Mizzou Securities. Your question, please. Great, thanks for squeezing me in. And thanks for all the details today. So maybe just one on the commercial side again, I guess, for Elaine. I guess, the comments are on gross to net.

You know continues.

It is an elderly patient population that we serve.

Understood. Thanks, guys.

Thank you and our final question for today comes from the line of the mill the ban from Mizuho Securities. Your question. Please.

Great. Thanks for squeezing.

Squeezing me and thanks for all the detail today. So maybe just 1 on the commercial side again, that's for Elena just the comments around gross to net.

Amanda Morgan: Maybe I know it's too early to kind of give more guidance for next year or beyond, but can you sort of talk about, as you were talking about the higher gross net this year, is this sort of more the range you'd expect, sort of generally speaking, going forward, or is this more of an unusual situation this year where things will kind of settle back down as we look at 2022 and beyond?

Maybe I know, it's too early to kind of game.

Our guidance for next year or beyond but can you just sort of talk about is just talking about the higher gross to net this year is just sort of more of a range. You would expect sort of generally speaking going forward or is this more of a unusual situation. This year, where things were kind of settled back.

As we look at 2022 and beyond thank you.

Sure.

Hi them also.

Emile Devane: Hi Vamal, so as I mentioned in the prepared remarks, we've seen the volume from 340B institutions grow this year. It was pretty stable.

As I mentioned in the prepared remarks, we've seen the.

And the volume from 3 for needy institutions grow this year it was pretty stable last year in the low single digits and it increased this year to mid to high single digits.

Elena Ridloff: Transcribed by https://otter.ai

unknown: This is a trend that's been seen more broadly in the industry, so I wouldn't expect it to reverse. So, as I mentioned, we expect this year's growth to be about 20%, and we'll provide guidance for next year on our 4Q call.

This is a trend that's been seen more broadly in the industry. So I wouldn't expect it to reverse.

So as I mentioned in that.

We expect for this year growth tends to be about 20% and well.

Well provide guidance for next year 1 on our.

Elena Ridloff: for a Q call in the February time frame. Okay. All right. Thank you. Thank you. This does conclude the question and answer session of today's program. I'd like to hand the program back to management for any further remarks. Great, thanks, operator. Thanks so much to each of you for joining us today. We look forward to updating you on our progress as we move forward. Thank you, ladies and gentlemen, for your participation in today's conference. This does conclude the program. You may now disconnect. Good day.

For calling in the February timeframe.

Okay alright, thank you.

Thank you. This does conclude the question and answer session of today's program I'd like to hand, the program back to management for any further remarks.

Alright, great. Thanks, operator, and thanks, so much to each of you for joining US today, we look forward to updating you on our progress as we move forward.

Thank you, ladies and gentlemen for your participation in today's conference. This does conclude the program you may now disconnect good day.

Yeah.