Q3 2021 Jazz Pharmaceuticals PLC Earnings Call

Operator: Good afternoon, ladies and gentlemen, and welcome to the third quarter 2021 Jazz Pharmaceuticals earnings conference call. At this time, all participants are in a listen-only mode. After the speaker's presentation, there will be a question-and-answer session. To ask a question, you will need to press Star 1 on your telephone. I would now like to turn the conference over to our host, Ms. Andrea Flynn, Head of Investor Relations. Ma'am, please go ahead.

Good afternoon, ladies and gentlemen, and welcome to the third.

Jazz Pharmaceuticals earnings Conference call.

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

After the speaker's presentation, there will be a.

Question and answer session.

A question.

One on your telephone.

I would now like to turn the conference.

Ms Andrea Flynn.

The relation.

Please go ahead.

Andrea Flynn: Thank you and good afternoon everyone. Today, Jazz Pharmaceuticals reported its third quarter 2021 financial results. The slide presentation accompanying this webcast is available on the investors section of our website. Investors may also refer to the press release we issued earlier today, which is also posted on our website.

Thank you and good afternoon, everyone today Jazz Pharmaceuticals reported its third quarter 2021 financial results.

The slide presentation accompanying this webcast is available on the investors section of our web site investors May also refer to the press release, we issued earlier today, which is also posted to our website.

Andrea Flynn: On the call today are Bruce Cozadd, Chairman and Chief Executive Officer; and Rene Gala, Executive Vice President and Chief Financial Officer.

On the call today are Bruce Kodak's, Chairman and Chief Executive Officer, Renee Gala Executive Vice President and Chief Financial Officer, Dan Swisher, President and Rob <unk> Executive Vice President R&D and Chief Medical Officer.

Andrea Flynn: Financial Officer, Dan Swisher, President, and Rob Iannone, Executive Vice President, R&D, and Chief Medical Officer. Kim Sablich, Executive Vice President and General Manager of North America, and Phil Jochelson, Neuroscience Therapeutic Head, will join for Q&A.

Kim Sablich Executive Vice President and General manager of North America, and still chocolate and neuroscience therapeutic head will join for Q&A.

Andrea Flynn: On slide two, I'd like to remind you that today's webcast includes forward-looking statements, such as those related

On slide two I'd like to remind you that today's webcast includes forward looking statements such as those related to our future future financial and operating result growth potential and anticipate a development and commercialization milestones and goals, which involve risks and uncertainties that could cause actual events performance and results to differ materially from those contained in these forward.

Andrea Flynn: Such as those related to our future financial and operating results, growth potential, and anticipated development and commercialization milestones and goals, which involve risks and uncertainties that could cause actual events, performance, and results to differ materially from those contained in these forward-looking statements.

Looking statements.

Andrea Flynn: We encourage you to review the statements contained in today's press release, in our slide deck, and in our latest SEC Disclosure Document, which identifies certain factors that may cause a breach of confidentiality.

We encourage you to review the statements contained in today's press release, and our slide deck and in our latest SEC disclosure document, which identify certain factors that may cause the company's actual events performance and results to differ materially from those contained in our forward looking statements made on today's webcast, we undertake no duty or obligation to update our forward looking statement.

Andrea Flynn: We identify certain factors that may cause the company's actual events, performance, and results to differ materially from those contained in the forward-looking statements made on today's webcast. We undertake no duty or obligation to update our forward-looking statements.

Andrea Flynn: Turning to slide three of this webcast, we'll discuss non-GAAP financial measures. Reconciliations of GAAP to non-GAAP financial measures are included in today's press release and the slide deck available on the investor section of our website. I'll now turn the call over to Bruce. Thanks, Andrea. Good afternoon, everyone, and thank you for joining us today. I'll start on slide five.

Turning to slide three on this webcast, we'll discuss non-GAAP financial measures reconciliations of GAAP to non-GAAP financial measures are included in today's press release and the slide deck available on the investors section of our website.

I'll now turn the call over to Bruce.

Thanks, Andrea good afternoon, everyone and thank you for joining us today I'll start on slide five.

Bruce C. Cozadd: We remain laser-focused on executing our strategy across commercial, R&D, and corporate development, positioning Jazz to deliver sustained growth as we continue to build our high-value portfolio of commercial and clinical-stage therapies. In the third quarter, we continued to make progress in our transition to a diversified, innovative biopharma company by focusing on our three primary pillars. First, growing sales of existing products in our commercial portfolio, including through indication and geographic expansion. The market-leading adoption of Zywave and Narcoleptics.

We remain laser focused on executing our strategy across commercial R&D and corporate development positioning jobs to deliver sustained growth as we continue to build our high value portfolio of commercial and clinical stage therapies.

In the third quarter, we continued to make progress in our transition to a diversified innovative biopharma company by focusing on our three primary pillars first growing sales of existing products and our commercial portfolio, including through indication and geographic expansion.

Our market, leading adoption of XI wave in narcolepsy and top tier launch or does that zilkha in small cell lung cancer highlighter commercial execution across both our neuroscience and oncology therapeutic areas. The recent approval and launch because highway for idiopathic hypersomnia or I H showcases.

Bruce C. Cozadd: The Top Tier Launch of Zepxelca in Small Cell Lung Cancer highlights our commercial execution across both our neuroscience and oncology therapeutic areas. The recent approval and launch of Zywave for idiopathic hypersomnia, or IH, showcases our ability to expand to new indications in this case where there are no other FDA-approved therapies.

Our ability to expand to new indications in this case, where there are no other FDA approved therapies.

Bruce C. Cozadd: Further, our progress in securing access to and reimbursement for Epidiolex across major European markets demonstrates our team's capabilities beyond the U.S. Our acquisition of GW Pharmaceuticals epitomizes our second strategic objective, Acquiring Differentiated Commercial Products and Late-Stage Programs. This acquisition brought in a high-growth, durable commercial product in Epidiolex and expanded our R&D portfolio. Our third pillar is pursuing pipeline development of differentiated therapy. Excluding the acquisition of GW, since 2015, our team has increased our pipeline assets fourfold, resulting in 11 product approvals.

Further our progress in securing access and reimbursement throughout the dialogues across major European markets demonstrates our team's capabilities beyond the U S.

Our acquisition of GW Pharmaceuticals, epitomizes, our second strategic pillar acquiring differentiated commercial products in late stage programs. This acquisition brought in a high growth durable commercial product enough of dialects and expanded our R&D portfolio.

Our third pillar is pursuing pipeline development of differentiated therapies, excluding the acquisition of GW. Since 2015, our team has increased our pipeline assets four fold, resulting in 11 product approvals now with the addition of the GW pipeline and cannabinoid platform we.

We're excited about a more robust pipeline that will further enhance that R&D productivity.

Bruce C. Cozadd: Now with the addition of the GW pipeline and cannabinoid platform, we are excited about a more robust pipeline that will further enhance that R&D product. Turning to several key highlights this quarter, In 2020, we established an aggressive target of completing five commercial launches in 2020 and 2021. I'm pleased to announce that earlier this month, we launched ZyWave for IH and adults, which completes that goal.

Turning to several key highlights this quarter in 2020, we established an aggressive target of completing five commercial launches in 2020 and 2021.

I'm pleased to announce that earlier this month, we launched XI wave for IH in adults, which completes that goal.

This represents a major milestone for jazz underscoring our ability to advance therapies from concept to commercialization and successfully execute on launches of differentiated products that address critical patient needs.

Bruce C. Cozadd: This represents a major milestone for Jazz, underscoring our ability to advance therapies from concept to commercialization and successfully execute on launches of differentiated products that address critical patient needs. The launch of XiWave for IH provides a significant growth opportunity for our Oxibate franchise, which we view as a durable core component of Jazz's long-term value that has multiple Orange Book listed patents that extend through 2033. We continue to expect that a majority of Occitabate patients, across all approved indications, will benefit from Zywave in 2023, which accounts for branded and generic higher sodium oxidate therapies entering the market.

The launch of XI wave for IH provides a significant growth opportunity for our ox abate franchise, which we view as a durable core components of jazz as long term value that has multiple orange book listed patents.

Stepping through 2033.

We continue to expect that a majority of oxalate patients across all approved indications, we will benefit from XI wave in 2023.

[noise] accounts for branded and generic higher sodium oxalate therapies entering the market.

With respect to the entry of authorized generic Xyrem, we plan to provide guidance for 2022 as usual on our fourth quarter earnings call at that time, we anticipate providing more information on the xyrem authorized generic launch.

The integration of GW continues to move ahead and as I noted in the past there is a superb cultural fit between the jazz and GW teams. The acquisition has proven to be highly complementary to our existing commercial portfolio and added the exciting GW cannabinoid platform and science to our R&D.

Bruce C. Cozadd: With respect to the entry of authorized generic Xyrem, we plan to provide guidance for 2022, as usual, on our fourth quarter earnings call. At that time, we anticipate providing more information on the Xyrem authorized generic launch. The integration of GW continues to move ahead, and as I noted in the past, there is a superb cultural fit between the Jazz and GW teams.

<unk>.

That said, we acknowledge there is work to be done, but we have continued to grow up of dialects in the U S. There have been challenges in the face of the COVID-19 pandemic, Dan will provide more detail about how our commercial team is addressing these challenges to support further epidiorite growth in the U S.

We continue to strengthen the durability of epic dialects and now have 20 Orange book listed patents with a majority extending through 2035.

Bruce C. Cozadd: The acquisition has proven to be highly complementary to our existing commercial portfolio and added the exciting GW cannabinoid platform and science to our R&D pipeline. That said, we acknowledge there is work to be done. While we have continued to grow Epidiolex in the U.S., there have been challenges in the face of the COVID-19 pandemic. Dan will provide more detail about how our commercial team is addressing these challenges to support further Epidiolex growth in the U.S. We continue to strengthen the durability of Epidiolex and now have 20 Orange Book listed patents with the majority extending through 2035.

Were also generating additional IP, including a composition of matter like patent that we expect will be issued later this year and listed in the Orange book in the first quarter of 2022.

This patent will expire in 2039.

And I want to be very clear, we remain excited by the potential long term value creation that the GW acquisition can deliver and our confidence in epidiorite has blockbuster potential and its importance as a component of our commercial portfolio has only increased since we brought it in house.

Turning to oncology <unk> Zilkha team is executing a top tier commercial launch. We are also advancing a robust clinical development plan and Rob will provide more color on our R&D efforts for us up soccer and across our portfolio later in the call.

Bruce C. Cozadd: We are also generating additional IP, including a composition of matter patent that we expect will be issued later this year and listed in the orange book in the first quarter of 2022. This patent would expire in 2039.

On June 30th we were pleased to announce approval of relays under Fda's real time oncology review, while we're early in the launch we believe that Riley's will become the standard of care for patients who need a non E coli derived asparaginase.

Bruce C. Cozadd: And I want to be very clear, we remain excited by the potential long-term value creation that the GW acquisition can deliver. And our confidence in Epidiolex's blockbuster potential and its importance as a component of our commercial portfolio has only increased since we brought it in-house. Turning to oncology, our ZepZelka team is executing a top-tier commercial launch. We are also advancing a robust clinical development plan, and Rob will provide more color on our R&D efforts for ZepZelka and across our portfolio later in the call.

With respect to our financial performance, our third quarter delivered a 39% increase in total revenues compared to the same quarter last year.

We continue to diversify our revenue with more than 50% of net product sales coming from products launched or acquired since 2019 in Stark contrast to a year ago. When the same metric was just 8%.

These newer products are not only innovative medicines that address critical needs for patients with neurologic disorders and cancer. They're also durable long lived therapies that support our strategy of building a diversified high growth commercial portfolio our.

Bruce C. Cozadd: On June 30th, we are pleased to announce approval of RILAs under FDA's Real-Time Oncology Regulation. While we're early in the launch, we believe that Rylase will become the standard of care for patients who need a non-E. coli derived asparagin. With respect to our financial performance, our third quarter delivered a 39% increase in total revenues compared to the same quarter last year.

Our strong cash flow and disciplined capital allocation is enabling us to invest in the growth of our business, while staying on track to meet our deleveraging goal.

With a strong foundation exciting new opportunities and continued execution against our plan I remain highly confident in <unk> future.

I'll now turn the call over to Dan for an overview of our commercial performance after which Rob will share an update on progress across our R&D programs Renee will provide a financial overview and then we'll open the call to Q&A Dan over to you.

Bruce C. Cozadd: We continue to diversify our revenue, with more than 50% of net product sales coming from products launched or acquired since 2019, in stark contrast to a year ago when this same metric was just 8%. These newer products are not only innovative medicines that address critical needs for patients with neurologic disorders and cancer, but they're also durable, long-lived therapies that support our strategy of building a diversified, high-growth commercial portfolio. Our strong cash flow and disciplined capital allocation are enabling us to invest in the growth of our business while staying on track to meet our deleveraging goals.

Thanks, Bruce well I'm excited to share the progress across our commercial portfolio.

So starting with neuroscience, we saw strong momentum during the third quarter for Oxy based franchise.

Average active oxidate patients increased to approximately 16000 in the quarter, a 6% increase over the same period last year.

We exited the quarter with approximately 6000 actives evaluated patients up from approximately 5100 at the end of the second quarter.

We see significant opportunity for <unk> to continue to grow in narcolepsy and remain focused on educating physicians and patients about the lifelong burden of high sodium intake, particularly in a patient population like this one with an increased risk of cardiovascular comorbidities.

In addition to the strong adoption of XI away from existing Xyrem patients. We continue to see the large majority of oxidate naive patients being prescribed xyrem ways as opposed to Xyrem.

Bruce C. Cozadd: With a strong foundation, exciting new opportunities, and continued execution against our plan, I remain highly confident in Jazz's future. I'll now turn the call over to Dan for an overview of our commercial performance, after which Rob will share an update on progress across our R&D program. Rene will provide a financial overview, and then we'll open the call to Q&A. Dan, over to you. Thanks, Bruce.

Slide seven illustrates we've achieved market leading adoption for XI wave in narcolepsy relative to launches of other next generation neuroscience products. This speaks to the strong product profile, which includes SBA has published findings of the clinical superiority of XI waves to Xyrem based on greater safety because of reduced sodium.

As well as our deep understanding of the sleep space and our ability to successfully drive adoption of new therapies.

Daniel N. Swisher: Well, I'm excited to share the progress across our commercial portfolio. Starting with neuroscience, we saw strong momentum during the third quarter for our Oxibate franchise. Average active occibate patients increased to approximately 16,000 in the quarter, a six percent increase over the same period last year, and we exited the quarter with approximately 6,000 active ZyWave patients, up from approximately 5,100 at the end of the second quarter. We see significant opportunity for Zywave to continue to grow in narcolepsy and remain focused on educating physicians and patients about the lifelong burden of high sodium intake, particularly in a patient population like this one with an increased risk of cardiovascular comorbidities.

And we believe the IH indication will drive further growth of XI ways. Our commercial launch began on November one and I'll remind listeners that a replay of our October webcast discussing the commercial launch strategy of XI away for IH is available on our corporate website for those who missed it.

As we rollout this launch our initial focus is on driving awareness and adoption among existing oxidase prescribers and the approximately 37000 people who had been diagnosed with IH and are actively seeking health care.

Expanding the market beyond diagnosed <unk> patients who are actively seeking treatment provides us with a longer term growth opportunity and we estimate that the total diagnosed <unk> patient population is likely close to that of the diagnosed narcolepsy market, which is approximately 70 to 80000 patients.

Daniel N. Swisher: In addition to the strong adoption of ZyWave from existing XyRM patients, we continue to see the large majority of oxybate-naive patients being prescribed ZyWave as opposed to XyRM. As slide 7 illustrates, we've achieved market-leading adoption for ZyWave in narcolepsy relative to the launches of other next-generation neuroscience products. This speaks to the strong product profile, which includes FDA's published findings of the clinical superiority of ZyWave to Zyrum based on greater safety because of reduced sodium, as well as our deep understanding of the sleep space and our ability to successfully drive adoption of new therapies.

As a reminder, beginning with our fourth quarter and 2021 year end reporting we will share the breakdown of the number of <unk> patients based on their diagnosis of either narcolepsy or IH.

So moving to <unk>. This is our first full quarter with the products since the close of the GW acquisition.

<unk> net product sales were $164 million.

And we achieved a 21% increase over the same quarter in 2020, despite the ongoing impact of COVID-19.

COVID-19 continues to put short term pressure on Epidiorite growth. There are several factors related to the pandemic. There are at play on a macro level pediatric new prescriptions have been disproportionately impacted by COVID-19 relative to other specialties over the last 12 months as the chart on.

Daniel N. Swisher: And we believe the IH indication will drive further growth for ZyWave. Our commercial launch began on November 1, and I'll remind listeners that a replay of our October webcast discussing the commercial launch strategy of ZyWave for IH is available on our corporate website for those who missed it. As we roll out this launch, our initial focus is on driving awareness and adoption among existing Oxybate prescribers and the approximately 37,000 people who have been diagnosed with IH and are actively seeking health care.

Slide eight illustrates.

<unk> growth has been affected by this trend.

Reports from the field indicate that due to COVID-19, and the lack of access to vaccines, especially for children under 12 years of age. Many parents are hesitant to bring their children into an office setting and risk COVID-19 exposure or change the anti epilepsy treatment regimens and risk breakthrough seizures.

These dynamics have negatively impacted new patient starts the majority of which are pediatric patients.

The same time promotional visits institutional centers in the U S are down across the industry. We see this playing out without the dialogues through the first three quarters of 2021 relative to 2019, our average number of total monthly sales interactions with health care providers were down 44%.

Daniel N. Swisher: expanding the market beyond diagnosed IH patients who are actively seeking treatment

Daniel N. Swisher: This statement provides us with a longer-term growth opportunity, and we estimate that the total diag...

Daniel N. Swisher: The IH patient population is likely close to

Daniel N. Swisher: likely close to that of the diagnosed narcolepsy market, which is approximately 70 to 80,000 patients. As a reminder, beginning with our fourth quarter in 2021 year-end reporting, we will share the breakdown of the number of Zywave patients based on their diagnosis of either narcolepsy or IA. Moving to Epidiolex, this is our first full quarter with the product since the close of the GW acquisition.

<unk> overall with face to face interactions down 71%.

This has a notable negative impact on the growth rate of the newer product like that the dialogues where education and in office support for physicians with little or no product experience help expand trial usage and adoption.

And the impact here is not limited to at the dialogues sale.

Sales across and other anti epileptic drugs with similar indications step of dialogues have been flat in recent quarters.

Now turning to slide nine while there are challenges our team has made steady progress in driving adoption in our three current indications are they syndrome, Lennox <unk> syndrome, and tuberous sclerosis complex or TFC.

Daniel N. Swisher: Epidiolex net product sales were $160.4 million, and we achieved a 21% increase over the same quarter in 2020 despite the ongoing impact of COVID-19. COVID-19 continues to put short-term pressure on epidiotic growth. There are several factors related to the pandemic that are at play.

We continue to have high persistency rates among patients who begin therapy, and we see opportunity for additional patient growth across these indications.

There has been strong adoption of that the dialogues and large epilepsy centers and we have increased our reach now to smaller centers in general neurology practices.

Daniel N. Swisher: On a macro level, pediatric new prescriptions have been disproportionately impacted by COVID relative to other specialties over the last 12 months, as the chart on slide eight illustrates. Epidiolic growth has been affected by this trend. Reports from the field indicate that due to COVID-19 and the lack of access to vaccines, especially for children under 12 years of age, many parents are hesitant to bring their children into an office setting and risk COVID exposure or change anti-epilepsy treatment regimens and risk breakthrough seizures. These dynamics have negatively impacted new patient starts, the majority of which are pediatric patients. At the same time, promotional visits to institutional centers in the U.S. are down across the industry.

As we expect COVID-19 pressures to ease in the U S and now with younger children, becoming eligible to receive Covid vaccines, we expect to see an upturn in both patients visiting their health care providers to discuss new treatment options and our ability to provide in person education to physicians.

The combination of which we believe will contribute significantly to the direct growth.

Based on positive trends in new and unique prescribers as well as feedback from our prescribers. We are confident that we will continue to grow the epidiorite prescriber base.

So in response to the current environment, we've implemented a number of virtual educational initiatives for health care providers and patients to further their understanding of Epidiorite <unk> unique product profile and mechanism of action and the anti epileptic drug class and recent market research among prescribers approximately 40% of.

Daniel N. Swisher: We see this playing out with Epidiolex. Through the first three quarters of 2021, relative to 2019, our average number of total monthly sales interactions with health care providers was down 44% overall, with face-to-face interactions down 71%. This has a notable negative impact on the growth rate of a newer product like Epidiolex, where education and in-office support for physicians with little or no product experience help expand trial usage and adoption. And the impact here is not limited to epidiolex.

Funded indicate they are moving up the dialogue up in their treatment algorithm.

We believe this is underpinned by more prescribers, having experienced without the dialects overtime and gaining confidence in the product.

There is also a very large unmet need in refractory epilepsies in the U S alone. There are approximately 160000 treatment resistant pediatric epilepsy patients and approximately $1 million treatment resistant epilepsy patients overall.

Many of these patients have rare pediatric onset epilepsy syndrome for which no FDA approved treatment exists specific to that particular syndrome.

Daniel N. Swisher: Sales across other anti-epileptic drugs with similar indications to epidiolex have been flat in recent quarters. Now turning to slide nine, while there are challenges, our team has made steady progress in driving adoption in our three current indications, Dravet syndrome, Lennox-Gastaut syndrome, and tuberous sclerosis complex, or TSC.

<unk> has the potential to treat a broad range of seizure types and the goal of our development program is to add to that existing body of evidence.

Our planned Registrational trial in epilepsy, with Myoclonic, atonic seizures or E. Moss will provide data in the seizure type.

Daniel N. Swisher: We continue to have high persistency rates among patients who begin therapy, and we see opportunity for additional patient growth across these indications. There has been strong adoption of epidiolics in large epilepsy centers, and we have increased our reach now to smaller centers and general neurology practices. As we expect COVID-19 pressures to ease in the U.S. and now with younger children becoming eligible to receive COVID vaccines, we expect to see an upturn in both patients visiting their health care providers to discuss new treatment options and our ability to provide in-person education to physicians.

In addition, we continued to invest in company sponsored trials and to support investigator initiated studies to evaluate the efficacy and safety at the dialects and different epilepsy subtypes and across different endpoints.

We also see a significant opportunity for epidemics growth coming from markets outside the U S. Looking at slide 10, we have been extremely pleased with our progress in Europe, we have secured favorable pricing and access to date and national reimbursement is in place in four of the five largest European markets.

In Germany, the UK, Italy, and Spain, and those four markets pricing is greater than 70% of the U S. Wholesale acquisition price. In addition, we anticipate commercial launch in France next year.

Daniel N. Swisher: The combination of which we believe will contribute significantly to Epidiolex growth. Based on positive trends and new and unique prescribers, as well as feedback from our prescribers, we are confident that we will continue to grow the Epidiolex prescriber base. So in response to the current environment, we implemented a number of virtual educational initiatives for healthcare providers and patients to further their understanding of Epidiolex's unique product profile and mechanism of action in the anti-epileptic drug class.

Overall, we remain excited about the future growth potential of that the dialogues. While we are currently navigating short term headwinds. We are confident that would epidiorite says unique mechanism of action its ability to be combined with other therapies and increasing positive experiences in real world settings.

<unk> can become the standard of care for treatment resistant epilepsy.

So now turning to oncology and ZIP zilkha, our team has done an outstanding job on the launch of this innovative therapy as the graph on slide 11 shows net sales of <unk> substantially outperformed the launches of other comparable oncology products.

Daniel N. Swisher: In recent market research among prescribers, approximately 40% of respondents indicated they are moving epidiolex up in their treatment algorithm. We believe this is underpinned by more prescribers having experience with Epidiolex over time and gaining confidence in the product. There is also a very large unmet need for refractory epilepsies. In the U.S. alone, there are approximately 160,000 treatment-resistant pediatric epilepsy patients and approximately 1 million treatment-resistant epilepsy patients overall. Many of these patients have rare pediatric-onset epilepsy syndromes for which no FDA-approved treatment exists specific to that particular type.

Our team has done an outstanding AR.

Sorry, we continue to see strong growth in demand for <unk> in third quarter with net product sales of $71 7 million as noted in our press release, we have lowered our return provision to reflect actual experience.

This had the effect of increasing the quarter's net sales number by approximately $10 million. Excluding this adjustment third quarter net product sales increased approximately 10% compared to the second quarter as.

As you can see on the chart on slide 12, the zelle because now the treatment of choice in second line small cell lung cancer.

We're pleased that <unk> share in this setting continues to increase taking market share from <unk> T can and immuno oncology products used as monotherapy.

We continue to see near term growth opportunities as we expect <unk> will continue to gain share among patients being re challenged with platinum based chemotherapies or receiving other chemotherapy regimens.

Daniel N. Swisher: to that particular syndrome.

Daniel N. Swisher: Epidiolex has the potential to treat a broad range of seizure types, and the goal of our development program is to add to that existing body of evidence. Our planned registrational trial in epilepsy with myoclonic atonic seizures, or EMOS, will provide data in this seizure type.

Now moving to <unk> on slide 13, our internally developed a recombinant erwinia asparaginase therapy launched in mid July 3rd quarter net product sales were $20 7 million initial feedback from accounts is encouraging and we have received positive reports on the ease of both ordering and dose prep.

Ration as well as our support services.

In terms of the market dynamics are <unk> still available in the supply channel through mid September which included the last imported batch of Irwin a sold by Clinton Gen that FDA allowed the importation of in May.

Daniel N. Swisher: In addition, we continue to invest in company-sponsored trials and to support investigator-initiated studies to evaluate the efficacy and safety of epidiolex in different epilepsy subtypes and across different endpoints. We also see a significant opportunity for growth coming from markets outside the U.S. Looking at slide 10, we have been extremely pleased with our progress in Europe. We have secured favorable pricing and access to date, and national reimbursement is in place in four of the five largest European markets, including Germany, the U.K., Italy, and Spain. In those four markets, pricing is greater than 70% of the U.S. wholesale acquisition price.

We believe the overwhelming majority of Irwin a supply was used up by the end of August and there was a notable uptick in release orders beginning in September.

To support the launch we're executing numerous commercialization activities to educate healthcare professionals about the clinical profile and the administration of <unk> and we're working to place relates on institutional formularies and into their regular ordering systems.

In summary, having delivered on the XI away for narcolepsy and <unk> launches, we are confident in our commercialization teams ability to achieve successful launches for O'reilly and XI wave NIH.

And while we've been facing some near term headwinds from Covid for Epidiorite, we do expect to be able to drive growth for this brand and across our product portfolio in future quarters and to deliver meaningful value as we transform the lives of patients and their families.

Daniel N. Swisher: In addition, we anticipate a commercial launch in France next year. Overall, we remain excited about the future growth potential of Epidiolex. While we are currently navigating short-term headwinds, we are confident that with Epidiolex's unique mechanism of action, its ability to be combined with other therapies, and increasing positive experiences in real-world settings, Epidiolex can become a standard of care for treatment-resistant epilepsy. Now, turning to oncology and Xevzolca, our team has done an outstanding job on the launch of this innovative therapy.

I'm now going to turn the call over to Rob for an update on our development programs Rob.

Thank you Dan.

On slide 15, we've detailed key clinical programs in our pipeline.

Starting with our neuroscience development programs the integration between our jazz and GW R&D teams is progressing really well.

Advancing multiple therapies across our neuroscience portfolio, including a number of programs emerging from the GW cannabinoid platform.

<unk> is currently approved to treat seizures associated with three refractory epilepsy disorders, and we remain on track to initiate a registrational phase III trial for a fourth indication epilepsy with Myoclonic atonic seizures or emails and the first half of 2022.

Daniel N. Swisher: As a graph on slide 11 shows, net sales of Xevzolca substantially outperformed the launches of other comparable oncology products. Our team has done an outstanding job. We continue to see strong growth in demand for Zevzelka in the third quarter with net product sales of $71.7 million. As noted in our press release, we have lowered our return provision to reflect actual experience. This had the effect of increasing the quarter's net sales number by approximately $10 million. Excluding this adjustment, third quarter net product sales increased approximately 10% compared to the second quarter.

He must is characterized by generalized micronic atonic seizures.

And this trial will provide the first randomized controlled clinical data with <unk> and the seizure types, which we believe will provide further data on the potential effectiveness.

The dialects and treating a broad range of seizure disorders.

Now turning to <unk>.

Program has three active clinical trials focused on multiple sclerosis related spasticity.

We expect data from the first trial, which is a smaller shorter trial relative to the other two in the first half of 2022.

Daniel N. Swisher: As you can see in the chart on slide 12, Zepzelka is now the treatment of choice in second-line small cell lung cancer, and we're pleased that its share in this setting continues to increase, taking market share from Topatican and immuno-oncology products used as monotherapies. We continue to see near-term growth opportunities as we expect Zep Celka will continue to gain share among patients being re-challenged with platinum-based chemotherapies or receiving other chemotherapy regimens.

If the results from this first trial are positive there is the potential for a regulatory submission in the U S. In the next 18 to 24 months.

And we expect data from the two additional trials, which have larger sample sizes to readout in late 2022.

Really 2023.

Now to discuss the ACP three five we recently recently initiated our phase III clinical trial for <unk>, 385% in essential tremor.

Daniel N. Swisher: Now moving to Rylase on slide 13, our internally developed recombinant Erwinia asparaginase therapy launched in mid-July. Third quarter net product sales were $20.7 million. Initial feedback from accounts is encouraging, and we have received positive reports on the ease of both ordering and dose preparation, as well as our support services. In terms of the market dynamics, Erwin Ace was still available in the supply channel through mid-September, which included the last imported batch of Erwin Ace sold by Clinigen that FDA allowed the importation of in May. We believe the overwhelming majority of Erwin H. Supply was used up by the end of August, and there was a notable uptick in Riley's orders beginning in September.

And expect data to read out in the first half of 2024.

In the U S.

Top five European markets. It's estimated that there are approximately 2 million people diagnosed with essential tremor.

It's about a half a million paying drug treated.

We're also on track to initiate our phase II trial for <unk>, one five a.

Fatty acid amide hydrolase or saw inhibitor and post traumatic stress disorder.

End of this year.

Now moving to oncology I'd like to start with the Saka and update our development plans in small cell lung cancer and other potential indications, which includes four clinical trials that are underway or will be initiated in early 2022.

Daniel N. Swisher: To support the launch, we're executing numerous commercialization activities to educate healthcare professionals about the clinical profile and the administration of RYLACE, and we're working to place RYLACE on institutional formularies and into their regular ordering systems. In summary, having delivered on the ZyWave for Narcolepsy and ZepZelka launches, we are confident in our commercialization team's ability to achieve successful launches for Rylase and Zy And while we've been facing some near-term headwinds from COVID for Epidiolex, we do expect to be able to drive growth for this brand and across our product portfolio in future quarters and to deliver meaningful value as we transform the lives of patients and their families. I'm now going to turn the call over to Rob for an update on our development programs. Thank you, dear.

In collaboration with our partner Roche, we're supporting a phase III trial to evaluate first line use of <unk>.

In combination with a piece of <unk> or <unk>.

Centric compared to centric alone as maintenance therapy in patients with extensive stage small cell lung cancer after completion of induction chemotherapy.

This trial has already been initiated and is now listed on clinical trials Gov, and we anticipate the first patient will be enrolled later this year.

Okay.

Either trials include a confirmatory trial in second line small cell lung cancer being run by our partner farmer and is expected to initiate later this year.

Phase II basket trial to explore efficacy and safety of <unk> monotherapy in patients with selected advanced and metastatic solid tumors that we expect to initiate in early 2022.

As well as a phase four observational study in small cell lung cancer that is underway.

Now I'd like to point out that we expect the phase four study to provide additional data regarding the efficacy of <unk> in certain populations, including those patients considered to be platinum sensitive.

Robert Iannone: On slide 15, we've detailed key clinical programs in our pipeline. Starting with our neuroscience development programs, the integration between our jazz and GW R&D teams is progressing really well. We are advancing multiple therapies across our neuroscience portfolio, including a number of programs emerging from the GW cannabinoid platform. Epidiolex is currently approved to treat seizures associated with three refractory epilepsy disorders, and we remain on track to initiate a registrational phase three trial for a fourth indication. Epilepsy with Myoclonic Atonic Seizures, or EMAS, in the first half of 2022. Hemostasis is characterized by generalized myoclonic atonic fusion.

Often retreated with platinum based chemotherapy in second line.

I'd like to highlight that these patients did particularly well with himself.

As seen in the cohort of patients that supported accelerated approval.

Further evidence of improved outcomes across a large number of platinum sensitive patients.

That's just from the face for observational study.

Would provide even stronger rationale for expanding the use of <unk>.

In this key second line setting.

And then retreat and it is the second most used therapy behind itself.

Moving to Riley, we received FDA approval June prior to the completion of our clinical trial through the real time oncology review process, which allowed us to prioritize making this therapy available to patients.

Robert Iannone: And this trial will provide the first randomized, controlled clinical data with Epidiolex in this seizure, which we believe will provide further data on the potential effectiveness of Epidiolex in treating a broad range of seizure disorders. Now, turning to Naviximals. The program has three active clinical trials focused on multiple sclerosis-related spasticity. We expect data from the first trial, which is a smaller, shorter trial relative to the other two, in the first half of 2022.

We took wireless from first in human trials to approval in just two and a half years and.

And we have that same urgency as we advance the development program.

We are very pleased to receive real time oncology review status yet again this time to submit an S. BLA to update our label to intramuscular Monday Wednesday Friday dosing schedule a schedule that is more in line with current clinical practice and this is a high priority for the program.

We expect to complete the SPL a submission in early 2022.

The only the only trials also assessing intravenous administration of royalties, which is common for asparaginase in Europe and other geographies.

We anticipate the data from our current development program will support regulatory submissions in Europe, and we are moving rapidly to submit in mid 2022 or both the iam Niv routes of administration with potential approvals in Europe, beginning in 2023.

Robert Iannone: If results from this first trial are positive, there is the potential for a regulatory submission in the U.S. in the next 18 to 24 months, and we expect data from the two additional trials, which have larger sample sizes, to read out in late 2022 and early 2023. Now to discuss JZP385, we recently initiated our Phase 2 clinical trial for JZP385 in essential tremor, and we expect data to read out in the first half of 2024.

Robert Iannone: In the U.S., and Top 5 European Markets, it is estimated that there are approximately 2 million people diagnosed with essential tremor, with about a half a million being drug-treated. We are also on track to initiate our Phase 2 trial for JZP15, Fatty Acid Amide Hydrolysis.

Robert Iannone: Thaw Inhibitor in Post Traumatic Stress Disorder by the end of this year. Now moving to Oncology, I'd like to start with Ziv Salka and update our development plans for small cell lung cancer and other potential indications, which include four clinical trials that are underway or will be initiated in early 2022. In collaboration with our partner Roche, we are supporting a phase three trial to evaluate first-line use of Zipfelca in combination with Tizolizumab or Ticentric as maintenance therapy in patients with extensive stage small cell lung cancer after completion of induction chemotherapy.

And we're well positioned to finish the year with positive momentum entering 2022.

We remain on track for substantial annual revenue growth this year and for the first time expect to exceed $3 billion in annual revenue.

This growth was demonstrated in our third quarter revenue results of $838 million, which represented a 39% growth over the same period last year.

Our strong performance is underpinned by commercial execution financial discipline, and strategic allocation of capital as well as prioritization of commercial and R&D opportunities that have the most impact on our future growth.

Robert Iannone: This trial has already been initiated and is now listed on clinicaltrials.gov, and we anticipate the first patient will be enrolled later this year. Other trials include a confirmatory trial on second lung cancer, being run by our partner, PharmaMar, that is expected to start later this year. Phase II Basket Trial to Explore Efficacy and Safety of Lurminectin Monotherapy in Patients with Select Advanced and Metastatic Solid Tumors that we expect to initiate in early 2022, as well as a phase four observational study in small cell lung cancer that is underway.

Launching multiple products over the past two years, coupled with the acquisition of GW Pharmaceuticals has enabled us to significantly advance our objective of diversifying revenue.

52% of that product sales in the third quarter were generated from products, which we have launched or acquired since 2019.

Given our expectations regarding the durability and growth potential of these products, we remain confident in reaching our goal of at least 65% of net product sales coming from these newer products in 2022.

Robert Iannone: Now, I'd like to point out that we expect the Phase 4 study to provide additional data regarding the efficacy of Zip Zelka in certain populations, including those patients considered to be platinum sensitive who were often retreated with platinum-based chemotherapy in the second line. I would like to highlight that these patients did particularly well with themselves, as seen in the cohort of patients that supported accelerated approval. Further evidence of improved outcomes across a large number of platinum-sensitive patients, such as from the phase four observational study, would provide even stronger rationale for expanding the use of Zitzelka in this key second line setting. Platinum retreatment is the second most used therapy behind itself.

Focusing specifically on the G. W acquisition, we're demonstrating our ability to execute on the corporate development front, we successfully close this transform it a transaction and approximately 90 days co signing issuing over $5 billion of new debt with attractive and flexible turns to.

Support the deal.

The broad commercial and R&D portfolio, we gained in the GW acquisition has accelerated our transformation not only in terms of revenue diversification and R&D expansion, but also increased expectations for future top and bottom line growth.

Robert Iannone: Moving to Rylace, we received FDA approval in June prior to the completion of our clinical trial through the real-time oncology review process, which allowed us to prioritize making this therapy available to patients. We took RILAs from first in human trials to approval in just two and a half years. And we have that same urgency as we advance the development program. We are very pleased to receive real-time oncology review status yet again this time to submit an SPLA to update our label to intramuscular Monday, Wednesday, Friday, a schedule that is more in line with current clinical practice. And this is a high priority for the program.

As Bruce mentioned earlier, we're very pleased with the progress of the <unk> of the G. W integration and bringing our company's together not only have we enhanced our capabilities expanded our footprint and retained key talent across both organizations, but we are locking in our synergy targets and optum.

<unk> the way, we operate and invest through transformation initiative that are driving greater effectiveness and focus on our most important priorities.

Since closing the transaction are strong cash generation driven by our continued financial and operational performance has enabled us to achieve a 4.4 times in that leverage ratio at the end of the third quarter.

Robert Iannone: We expect to complete the SBLA submission in early 2020. The ongoing trial is also assessing the intravenous administration of Ritalin, which is common for asparaginase in Europe and other geographies. We anticipate the data from our current development program will support regulatory submissions in Europe, and we are moving rapidly to submit in mid-2022 for both the IM and IV routes of administration with potential approvals in Europe beginning in 2022. We are presenting data from the RILASE trial at the upcoming American Society of Hematology annual meeting in December, including findings from the important 25-25-50 mg IM dosing regimen from 52 patients.

This represents a half turned decrease in that leverage and just five months following the close of the transaction.

Importantly, we're on track to achieve our stated that leverage target of being below three and a half times by the end of 2022.

In addition to reducing debt. We're also investing in our business to drive future growth and durability. This includes focused investments and the ongoing commercial launches <unk>, realizing the blockbuster potential about the dialects and advancing are R&D pipeline and the G D.

<unk> cannabinoid platform as our newly launched commercial portfolio matures and our business scales, we expect to realize further operating leverage and associated improvements in our underlying operating margins.

Robert Iannone: I'd like to wrap up by highlighting that we have significantly advanced our combined R&D capabilities and productivity, and we have an incredibly talented team. As I've outlined here today, multiple late-stage trials and registrational trials are ongoing or expected to begin soon. And as we enter 2022, we look forward to sharing updates on our earlier stage development programs and research initiatives. I'll now turn the call over to Renee.

Now turning to guidance, we are raising our full year earnings guidance for non-GAAP, adjusted net income or a ni to arrange of $925 million to $965 million up from our prior range of $830 million to $910 million.

Are updated non-GAAP, an irate exceeds the upper end the prior range on both an absolute and a per share basis, which reflects both our financial discipline and strategic capital allocation.

Rene D. Gal: The full financial results are available in our press release and 10-Q, and several key metrics are highlighted on slides 17 and 18. On today's call, I'll discuss our overall financial performance and provide additional color around our updated guidance.

On the top line, we are narrowing or total revenue guidance range to three point O $2 billion to $3.1 billion from three point O $2 billion to $3.18 billion, reducing the mid point of total revenue guidance reflects our updated oncology revenue expectations.

Rene D. Gal: We have made significant strides in transforming our business through the first three quarters of 2021, and we're well positioned to finish the year with positive momentum entering 2022. We remain on track for substantial annual revenue growth this year, and for the first time, we expect to exceed $3 billion in annual revenue. This growth was demonstrated in our third quarter revenue results of $838 million, which represented a 39% growth over the same period last year.

Missions, which we have narrowed to $715 million to $735 million from 715, two $835 million.

Our current oncology guidance reflects ongoing impacts of COVID-19 on our legacy products and the riley's competitive landscape and the third quarter.

We have also narrowed our neuroscience revenue guidance to $2.275 billion to $2.345 billion, while keeping the same midpoint as our previous guidance.

Rene D. Gal: Our strong performance is underpinned by commercial execution, financial discipline, and strategic allocation of capital, as well as prioritization of commercial and R&D opportunities that have the most impact on our future growth. Launching multiple products over the past two years, coupled with the acquisition of GW Pharmaceuticals, has enabled us to significantly advance our objective of diversifying revenue. 52% of net product sales in the third quarter were generated from products which we have launched or acquired since 2019.

On the expense side, we have reduced our total opex guidance by approximately $115 million at the midpoint primarily to reflect the following three factors one a thoughtful approach to integrating the jazz and GW operations to prioritization of R&D activities too <unk>.

<unk> those opportunities that we believe will dribble deliver maximum value and three the extended duration of COVID-19, which pushed out a portion of our planned commercial spend for in person interactions.

Rene D. Gal: Given our expectations regarding the durability and growth potential of these products, we remain confident in reaching our goal of at least 65% of net product sales coming from these newer products in 2022. Focusing specifically on the GW acquisition, we are demonstrating our ability to execute on the corporate development front. We successfully closed this transformative transaction in approximately 90 days post-signing, issuing over $5 billion of new debt with attractive and flexible terms to support the deal.

I'll also note that included in our implied Fourthquarter Opex guidance is the launch of die away, then I H and three important clinical trial initiations with Jay Z P 385, J Z P. One five O ends at soccer.

The integration of jazz and GW has been a catalyst for transforming our business, we are becoming a highly efficient and effective organization poised to emerge as a nimble enterprise with the ability to scale rapidly as we continue to increase our revenue diversification and gross.

Rene D. Gal: The broad commercial and R&D portfolio we gained in the GW acquisition has accelerated our transformation, not only in terms of revenue diversification and R&D expansion but also increased expectations for future top and bottom line growth. As Bruce mentioned earlier, we're very pleased with the progress of the GW integration.

Our commercial portfolio now consists of multiple high growth long lived medicines, which is complemented by an amplified R&D organization that is advancing multiple mid and late stage programs and a corporate development strategy with a track record of valuable contributions to.

Our commercial and development efforts, we will continue to prioritize commercial R&D and business development efforts to drive value and growth leveraging our strong cash generation to invest in our business.

Rene D. Gal: In bringing our companies together, not only have we enhanced our capabilities, expanded our footprint, and retained key talent across both organizations, but we are locking in our synergy targets and optimizing the way we operate and invest through transformation initiatives that are driving greater effectiveness and focus on our most important priorities. Since closing the transaction, our strong cash generation, driven by our continued financial and operational performance, has enabled us to achieve a 4.4 times net leverage ratio at the end of the third quarter. This represents a half-turn decrease in net leverage in just five months following the close of the transaction.

Improve our bottom line and continue to deliver strong shareholder returns.

And now like to turn the call back to Bruce.

Thanks, Renee I'll conclude our prepared remarks on slide 19.

Building on our current momentum we expect to finish 2021 on a strong footing, which will position us well going into 2022.

With F D. A approval of Zywiec Fry age we achieved our goal of five product launches in two years or commercial teams have demonstrated strong performance on the launches <unk> for narcolepsy ends up soccer and we expect that successful execution will carry forward to the launches of reilly's and Zywiec Fry.

Rene D. Gal: Importantly, we are on track to achieve our stated net leverage target of being below three and a half times by the end of 2022. In addition to reducing debt, we are also investing in our business to drive future growth and durability. This includes focused investments in the ongoing commercial launches of Zywave, Zepselka, and Rylase, realizing the blockbuster potential of Epidiolex, and advancing our R&D pipeline and the GW cannabinoid platform. As our newly launched commercial portfolio matures and our business scales, we expect to realize further operating leverage and associated improvements in our underlying operating margins.

H G.

The GW team orchestrated an excellent lodge for Epidiolex and it's addition to work commercial portfolio provides us with the opportunity to deliver an important therapy to patients was refractory epilepsies.

Our R&D organization continues to evolve and expand its capabilities trials for new pixel malls J Z P. 385, Riley's ends up soccer are now underway and we were planning to initiate multiple mid and late stage clinical trials in the next 12 months are disciplined capital allocation is innate.

Hold us to expand our pipeline and diversify our revenues and we are in a position to invest in those assets and opportunities would hold the highest potential to drive sustainable long term growth and shareholder value.

Rene D. Gal: Now turning to guidance, we are raising our full-year earnings guidance for non-GAAP Adjusted Net Income, or ANI, to a range of $925 to $965 million, up from our prior range of $830 to $910 million. Our updated non-GAAP ANI range exceeds the upper end of the prior range on both an absolute and a per share basis, which reflects both our financial discipline and strategic capital allocation.

We have the ability to generate strong cash flow that allows us to make appropriate investments in our business, while also achieving our deleveraging targets.

That concludes our prepared remarks, and I'd now like to turn the call over to the operator to open the line for Q&A.

Ladies and gentlemen, if you have a question at this time the first five and the number one can I get a telephone if you're a question that's been answered, though you wish to remove yourself from the queue press the bounty as a reminder, please limit yourself to one question. Thank you.

Rene D. Gal: On the top line, we are narrowing our total revenue guidance range to $3.02 to $3.1 billion from $3.02 to $3.18 billion. Reducing the midpoint of total revenue guidance reflects our updated oncology revenue expectations, which we have narrowed to $715 to $735 million from $715 to $835 million. Our current oncology guidance reflects ongoing impacts of COVID on our legacy products and the Riley competitive landscape in the third quarter. We have also narrowed our neuroscience revenue guidance to $2.275 to $2.345 billion while keeping the same midpoint as our previous guidance. On the expense side, we have reduced our total OPEX guidance by approximately $115 million at the midpoint, primarily to reflect the following three factors.

Yeah first question comes from the line of my Goodman. Some S V. P link your line is open.

Yes, hi, rug I heard that there's been.

Some R&D activities that have kind of gone away. That's what really said can you talk about some of the programs, but uhm have stopped or just kind of curious there was GW had an autism program. They had a product for schizophrenia. They had a next generation epidiolex that they showed some early data on before the merger just curious of those old and <unk>.

<unk> or just give us a sense of of that and then if you guys could you just give us a little more color on on reilly's and how to think about what's backlog versus what's uhm real demand and and whether we should expect a massive step up this quarter. Thank you.

[noise] I'm not sure if you want to comment on what you are specifically referring to that too late I would answer that question is.

Rene D. Gal: One, a thoughtful approach to integrating the Jazz and GW operations. Two, prioritization of R&D activities to invest in those opportunities that we believe will deliver maximum value. And three, the extended duration of COVID-19, which pushed out a portion of our planned commercial spend for in-person interaction.

And coming together with G. W. We really have the opportunity to continue to invest in the highest value opportunities and of course, we've prioritize certain days as we've described in this in this call Tonight there were many.

Many smaller studies that may have been investigator initiated or we supported along the light either on the GW or jazz side that may not ultimately.

Rene D. Gal: I'll also note that included in our implied fourth-quarter OPEX guidance is the launch of ZyWave and IH and three important clinical trial initiations with JZP385, JZP150, and Zepselka. The integration of Jazz and GW has been a catalyst for transforming our business. We are becoming a highly efficient and effective organization poised to emerge as a nimble enterprise with the ability to scale rapidly as we continue to increase our revenue diversification and growth.

Progressing the pipeline, but I think by and large we've continued to invest heavily.

All the key areas Uhm that we were investing in the prior legacy code. Please.

Yeah, So I just need to add.

Go ahead and go ahead when they.

Yeah, I was just going to add that this is also about as we bring our organization together. The house is not just the what certainly we've seen a lot of complementary skill sets coming from both areas. So in some cases as we put together hiring plans and looked at the skill sets that we've needed.

We've seen these two groups come together and offer more verses what was that originally anticipated and that's not something that you'd have a really good idea of mark until you get the groups together and really start integrating we've also seen example, certainly a certain programs that would be duplicative across both pipelines.

Rene D. Gal: Our commercial portfolio now consists of multiple high-growth, long-lived medicines, which is complemented by an augmented R&D organization that is advancing multiple mid- and late-stage programs and a corporate development strategy with a track record of valuable contributions to our commercial and development efforts. We will continue to prioritize commercial R&D and business development efforts that drive value and growth, leveraging our strong cash generation to invest in our business, improve our bottom line, and continue to deliver strong shareholder returns. And now, I'd like to turn the call back to Bruce. Thanks, Rene.

That's a great problem to have as you look at where the investor capital to ensure that you're putting your capital behind your highest value activities.

Kim maybe I can ask you to jump in on the Riley's question.

Sure. It's I'll I'll start by saying that you know we will it later really strong foundation and you know Riley growth is is continuing to accelerate we've gotten initial feedback from our account that's very encouraging we received positive reports on the ease of both ordering and those preparation as well as.

Bruce C. Cozadd: I'll conclude our prepared remarks on slide 19. Building on our current momentum, we expect to finish 2021 on a strong footing, which will position us well going into 2022. With FDA approval of Zywave for IH, we achieved our goal of five product launches. Our commercial teams demonstrated strong performance on the launches of Zywave for Narcolepsy and Zefzelka, and we expect that successful execution will carry forward to the launches of Rylase and Zywave for IA.

Uhm the jazz care support services, what I can say about you know ordering is that when you know riley's with made commercially available mid July there was still early days on the market on hand in hospital pharmacy that they were looking to utilize before placing orders the temporary importation.

A U K or <unk> from June we saw run out back in September and that's where we really thought of notable uptick in and <unk> orders at beginning in September from customers. So overall, we're we're very encouraged by feedback from accounts and we think we are in a strong place you know from an order stand.

Bruce C. Cozadd: The GW team orchestrated an excellent launch for Epidiolex, and its addition to our commercial portfolio provides us with the opportunity to deliver an important therapy to patients with refractory, Our R&D organization continues to evolve and expand its capabilities. Trials for nabixamals, JCP385, Rilase, and Zepzelka are now underway, and we are planning to initiate multiple mid- and late-stage clinical trials in the next 12 months.

Point.

Operator.

Your next question comes from the line of Jason Survey from Bank of America. Your line is open.

Oh, Hey, guys. Thanks for taking my questions. So my phone on thigh wave and thinking about the progression of the launch here do you think there are accelerants to the right of quarterly edition that are moving on to <unk> and in your latest thoughts on hikma. Thank <unk>.

Last quarter, you frame it as a possible risk of market entry in 2022, just curious if that's still the case and ultimately curious Bruce your comment about four Q and providing an update their I guess, what what materially changes in the contracts that could allow you to talk about hikma timing in February versus not being able to talk about it today in November thanks.

Operator: Our disciplined capital allocation has enabled us to expand our pipeline and diversify our revenue, and we are in a position to invest in those assets and opportunities that hold the highest potential to drive sustainable long-term growth and shareholder value. We have the ability to generate strong cash that allows us to make appropriate investments in our business while also achieving our deleveraging target. That concludes our prepared remarks, and I'd now like to turn the call over to the operator to open the line for Q&A.

Yeah, maybe I'll pick the back half of your question for Jason and I can ask him to comment on Zywiec progression.

What what will change in the fourth quarter earnings announcement is will be doing that in the context of giving full guidance for 2022 across our business, including neuroscience and including Oxidate and I think he can give you a better sense of how we expect the ear to to play out so it's not a a comment specifically on contractual term.

Terms, it's just providing a full explanation of our expert expectations for oxalate.

Operator: Ladies and gentlemen, if you have a question at this time, please press star then the number one key on your telephone. If your question has been answered or you wish to remove yourself from the queue, please press the pound. As a reminder, please limit yourself to one question each. Your first question comes from the line of Mark Goodman from SVP Lyrinc. Your line is open. Yes, I Rob, I heard that there's been

On the question of timing Nothing's changed since our disclosure of the last couple of quarters honestly in terms of recognizing got although other contracts as entry no later than January 1st 2023, you know there is a market declined provision that we believe could be tripped in 2022.

But that's not different from what we've said before.

Marc Goodman: Yes, hi, Rob. I heard that there are some R&D activities that have kind of gone away. That's what Rene said. Can you talk about some of the programs that have stopped? I'm just kind of curious.

On on Zywiec progression I'll ask him to jump in but you know we're really excited to have launched a product last week in a new indication and so for the first time.

In our fourth quarter 2021 results will of course have both narcolepsy M and the beginnings of the IH lunch.

Robert Iannone: There was GW had an autism program. They had a product for schizophrenia. They had a next-generation epiidiolex that they showed some early data on before the merger. Just curious; have those all been stopped, or just give us a sense of that? And then, if you guys could just give us a little more color on Riley's and how to think about what's in the backlog versus what's real demand and whether we should expect a massive step up this quarter. Thank you.

So that'll be a little bit of a change of of just the trajectory we've seen thus far Kim.

Sure Great. So is Dan shared you know we're excited it violated it seemed in a market leading adoption in narcolepsy and that we continue to see some nice ballad growth through the third quarter <unk>.

We've seen to date very strong adoption among high volume activate prescribers and are now really increasing our focus on a C. P as who have either not yet adapted die wave or have not transition yet the majority of their narcolepsy patients among those that have transition most of their patients we're focusing on.

Robert Iannone: Rene, I'm not sure if you want to comment on what you were specifically referring to, but the way I would answer that question is, in coming together with GW, we really had the opportunity to continue to invest in the highest value opportunities. And, of course, we've prioritized certain things, as we've described on this call tonight. There were many, many smaller studies that may have been investigated or initiated or we supported along the way, either on the GW or Jazz side, that may not ultimately progress in the pipeline. But I think, by and large, we've continued to invest heavily in all the key areas that we were investing in prior to legacy.

You know activate naive patients, while we anticipate that the adoption rate among these HCP and actually you know we've observed.

Will be slower then we saw in the first three quarters. You know we do remain focused on educating the eight C. PS and patience about you know the lifelong burden of high sodium intake. So we remain optimistic the H C. P. As will see the value in lower sodium act debate as we see the majority of you know off the date night.

Rene D. Gal: And I'll just add, go ahead.

<unk> patient today being prescribed XI Wade as opposed to two Xyrem and you know we're very pleased that the F. D. A recognize the importance of lower sodium options by granting evaluate the orphan drug exclusivity back in June and went on to state that you know the clinical security by superior.

Rene D. Gal: I was just going to add that this is also about, as we bring our organizations together, the how as much as the what. Certainly, we've seen a lot of complementary skill sets coming from both areas. So in some cases, as we put together hiring plans and looked at the skill sets that we needed, we've seen these two groups come together and offer more versus what was originally anticipated. And that's not something that you'd have a really good idea of, Mark, until you get the groups together and really start integrating.

Already finding where that dilate as clinically superior to Xyrem xyrem by means of greater safety, because I will provide the greatly reduced chronic sodium burden compared to xyrem and.

Rene D. Gal: We've also seen examples, certainly, of certain programs that would be duplicative across both pipelines. That's a great problem to have as you look at where to invest your capital to ensure that you're putting your capital behind your highest value activities. Kim, maybe I can ask you to jump in on Riley's question. Sure. So I'll start by saying that, you know, we've laid

And then the other driving factor is Bruce didn't mention of course is that we want should I wait for the treatment of IH last week, which is the first and only F. D. A approved treatment for adults with idiopathic hypersomnia and we really see this launches a significant value driver with approximately 37000 adult patients out.

There have been diagnosed with I H and are actually out there actively seeking treatment for it and the health care system. So our commercial teams are working uhm to educate right now about thigh with a I H. While also very importantly, continuing to educate about the importance of transitioning narcolepsy patients.

Kim Sablich: Continuing to accelerate, we've gotten initial feedback from our accounts, and it's very encouraging.

Kim Sablich: We've received positive reports on the ease of both ordering and dose preparation, as well as the Jazz Care support services. What I can say about ordering is that when Riley's was made commercially available in mid-July, there was still Erwin A's on the market on hand in hospital pharmacies that they were looking to utilize before placing orders. The temporary importation of UK Erwin A's from June, we saw a run out of stock in September, and that's where we really saw a notable uptick in Riley's.

<unk>, if you can do to the benefits of the lower sodium so uhm specifically in IH, we're focused on executing a very targeted lot strategy that includes both robust disease education and branded efforts and to support. This strategy. We have a variety of digital an in person efforts that you know are helping to demonstrate both the I H.

Kim Sablich: We are very encouraged by feedback from accounts, and we think we are in a strong position from an order standpoint.

Operator: Your next question comes from the line of Jason Garberry from Bank of America. Your line is open.

Is a unique medical condition and the clinical benefits and safety profile <unk>. So moving forward, we're gonna be providing a number of metrics first of all you know will continue to provide the average number of activate patient I will continue to provide the total number of patients and <unk> and we will star.

Jason Garberry: Oh, hey guys. Thanks for taking my questions. So, my question is on Zywave and thinking about the progression of the launch here. Do you think there are accelerants to the rate of quarterly additions that are moving on to Zywave? And your latest thoughts on HICMA? I think last quarter you framed it as a possible risk of market entry in 2022. Just curious if that's still the case.

To provide the breakdown of the number of thyroid patients based on diagnosis at either narcolepsy or I H.

Got it thank you.

Your next question comes from the line is Jessica see some J P. Morgan.

Bruce C. Cozadd: And ultimately curious, Bruce, about 4Q and providing an update there. I guess what materially changed in the contracts that could allow you to talk about HICMA timing in February versus not being able to talk about it today in November? Thanks.

Okay.

Hey, guys. Good evening. Thanks for taking my question Rene you talked about how is the newly launched commercial portfolio matures and skills that you expect to realize further operating leverage.

Can you talk about if we should expect the operating margin improvement in 2022 over 2021.

Yeah. Thanks for the question just so I would say stay tuned for 2022 guidance as Bruce mentioned will plan on giving that specific guidance in early 2022, when we're reporting our year end results and that would be more appropriate after we've gone.

Bruce C. Cozadd: And maybe I'll pick the back half of your question for Jason, and I can ask him to comment on Xiwave progression. Um, you know, what will change in the fourth quarter earnings announcement is that we'll be doing that in the context of giving full guidance for 2022 across our business, including neuroscience and including Oxibate, and I think I can give you a better sense of how we expect the year to play out. So it's not a comment specifically on contractual terms.

And through our full budget and goals process with our board of directors, but beyond that I would think more broadly about yes, as our newer products then start to mature and to products that have gotten through that initial launch faith that are off to a strong start that you should expect overtime that operating March.

And whether it be specific to SG&A or as we're thinking about our broader cost structure to improve.

Bruce C. Cozadd: It's just, you know, providing a full explanation of our expectations for Oxibate. On the question of timing, nothing's changed since our disclosure of the last couple quarters, honestly, in terms of recognizing that although the contract says entry no later than January 1st, 2023, there is a market decline provision that we believe could be triggered in 2022. But that's not different from what we've said before.

Okay got it yeah, I'm just trying to figure out if next to your account is one of the ears of those wants products beginning to mature or still kind of more of an investment here.

Hi, How's your day bye without adding.

Go ahead <unk>.

Yeah, I'd say without giving specific guidance on what that would look like we'll be focused on ensuring that in 2022 were position to achieve our goal of having 65% of our revenues associated with those newer products.

That being sideways Epidiolex does that Celica <unk> N. As you think about where our focus is that's making sure. The longterm growth is positioning us to be able to achieve those operating margin of course with the transaction. We did say that we expect.

Bruce C. Cozadd: On XyWave progression, I'll ask Kim to jump in. But, you know, we're really excited to have launched a product last week in a new indication. And so for the first time, in our fourth quarter 2021 results, we will, of course, have both narcolepsy and the beginnings of the IH launch. So that'll be a little bit of a change from just the trajectory we've seen thus far. Kim?

<unk> accretion and the first full year and we've also talked a lot about investing in our pipeline. So well, we're gonna be focused on improving our bottom line margins. We're also gonna be focused on ensuring that we're putting sufficient investment behind our R&D portfolio and pipeline to ensure that we're creating greater strength.

Kim Sablich: Sure, great. As Dan shared, we're excited that Zywave has achieved market-leading adoption in narcolepsy and that we've, you know, continued to see some nice solid growth through the third quarter. We've seen to date very strong adoption among high-volume oxidate prescribers and are now really increasing our focus on you.

And greater durability.

Thank you.

Your next question comes from the line of checks.

From Morgan Stanley Your line is open.

Thanks for taking the question you mentioned hyper assistance fee for the Epidiolex indications I guess from here on out which of the indications do you see as the bigger potential drivers for Epidiolex failed and what kind of impact you expect going forward because we from off label indication. Thanks.

Kim Sablich: You know, ACPs who have either not yet adopted Zywave or have not.

Ah, Dan or Kim you Wanna jumped in on it but ilex.

Kim Sablich: Transition, yet the majority of their narcolepsy patients, you know, among those that have transitioned.

Yeah, I'm happy to to start and then can you can you can add in that as I mentioned in this in the earnings call. Yeah, We anticipate associate as of COVID-19 pressures ease and based on the real world experiences that we've had with the physicians who have adopted the therapy.

Kim Sablich: Most of their patients were focusing on, you know, obsolete, naive patients. While we anticipate that

That there's plenty of room for fish and growth.

Kim Sablich: Adoption Rates among these HCPs and actually, we've observed, will be slower than we saw in the first three quarters. We do remain focused on

Cross all three of her indications and kind of more broadly there's this pool of treatment resistant epilepsy patients 160000, pediatric and a million dollars overall.

Kim Sablich: Educating these HCPs and patients about the lifelong burden of high sodium intake. So we remain optimistic that HCPs will see the value in lower sodium oxidate as we see the majority of, you know, oxidate-naive patients today being prescribed Zywave as opposed to Zyrum. And, you know, we're very pleased that the FDA recognized the importance of lower sodium options by granting Zywave orphan drug exclusivity back in June and went on to state that, you know, the clinical superiority findings were that Zywave is clinically superior to Zyrum by means of greater safety because Zyway provides a greatly reduced chronic sodium burden compared to Xyrem.

Many of them are with syndrome that are not they'll have no FDA approved therapies and so often the physicians are looking at the.

The seizure test for those disorders, and given that Epidiolex has a broad range of activity across multiple seizure types and good.

Market access uhm to support physicians and patients in those settings, you know like most anti epilepsy drugs. We do think that Epidiolex will become a cornerstone of therapy across multiple seizure types beyond the the indicated label.

I don't know if you want to add anything.

No I think you've covered all the points above them.

Thank you.

Your next question comes from Atlanta.

Patty asked a medium your line is open.

Hi, good evening, thanks for taking the question.

Just a moron epidiolex can you.

Kim Sablich: And then, you know, the other driving factor, as Bruce just mentioned, of course, is that we launched Zyway for the treatment of IH last week, which is the first and only FDA-approved treatment for adults with idiopathic hypersomnia. And we really see this launch as a significant value driver, with approximately 37,000 adult patients out there who have been diagnosed with IH and are actually actively seeking treatment for it in the healthcare system.

Give us some more color on baywatch, but the patent application you indicated that you expected to be initiated a study to be issued by the end of the year. So maybe any more color. There and then just with regard to the Myoclonic Atonic Caesar.

Why did you pick that what was the basis on the chance hot.

That that was applicability in that in that seizure tight and if you could give us some preliminary sense of what is the target market potential if it works in that piece of your time. Thanks.

Kim Sablich: So our commercial teams are working to educate right now about ZyWear for IH, while also, very importantly, continuing to educate about the importance of transition.

Yeah, I mean, nothing more to add on the timing of the of the new.

Pattern issuance and Orange book, staying in and I'm not sure of the timing of that is particularly important other than obviously, what the long dated expiration of the patent would be.

Kim Sablich: Transitioning Narcolepsy Patients to Zywave due to the Benefits of Lower Sodium. So, specifically in IH, we're focused on executing a very targeted launch strategy that includes both robust disease education and branded efforts. And to support this strategy, we have a variety of digital and in-person efforts that, you know, are helping to demonstrate both that IH is a unique medical condition and the clinical benefits and safety profile of Zywave. So, you know, moving forward, we're going to be demonstrating a number of metrics.

Rob maybe you could talk a little bit about why we've elected to go into the <unk> trial next and then Ah Kim or Dan you can talk about potential in that marketplace as well Rob.

Yeah, <unk> happy to agree [laughter] no first of all it's an important medical need and he lost uhm.

Amongst pediatric epilepsy and based on your prior data and other.

Kim Sablich: We will continue to provide the average number of OxyBate patients, we will continue to provide the total number of patients on ZyWave, and we will start to provide the breakdown of the number of ZyWave patients based on the diagnosis of either narcolepsy or IH.

Seizure disorders, we think there's a high probability that working in that setting so there'll be a direct benefit to those patients. We also think it had.

Just evidence abroad.

Pull up take activity Epidiolex by studying a syndrome that is known to have a seizure type that is different than we currently have an indication for a total compliment the seizure types that we've already addressed in our indication finished you know.

Operator: Your next question comes from the line of Jessica Fye from JP Morgan. Your line is open.

Jessica Fye: Hey guys, good evening. Thanks for taking my question. Rene, you talked about how as the newly launched commercial portfolio matures and scales, you expect to realize further operating leverage. Can you talk about whether we should expect operating margin improvement in 2022 over 2021? Yeah, thanks for the question, Jeff.

Darker street seizure types, they don't necessarily treat the underlying.

Disorder as part of the epileptic therapies and so it provides that uhm additional data on broad activity cross issue types and while we wouldn't promote off label. These are the kinds of data that physicians often look for you to provide evidence of.

Rene D. Gal: So I would say, stay tuned for 2022 guidance. As Bruce mentioned, we'll plan on giving that specific guidance in early 2022 when we're reporting our year-end results. And that would be more appropriate after we've gone through our full budget and goals process with our Board of Directors. But beyond that, I would think more broadly about, yes, as our newer products then start to mature into products that have gotten through that initial launch phase that are off to a strong start that you should expect over time, that operating margin, whether it be specific to SG&A or as we're thinking about our broader cost structure to improve.

See I'm, a patient could that they're intending to treat.

Yeah, just jumping in there email us represents approximately 2% of childhood epilepsy, so not a insignificant disorder, but.

Even more importantly rounds of our dataset, which includes straw.

Strong activity combinability, and safety and tonic atonic, and now Myoclonic and clonic seizure types. So it says your opinion abroad evidence generation across multiple seizure types that you are typically seen in this treatment resistant epilepsy population, so that along with other.

Other studies were considering an investigator sponsored studies, both looking at disorders safety efficacy endpoints and other endpoints, where we see benefit beyond seizure type or seizure reduction is part of our overall evidence ma'am.

Rene D. Gal: Okay, got it. Yeah, just trying to figure out if next year counts as one of the years of those launch products beginning to mature or still kind of more of an investment year. That's just what I would say.

Thank you.

Your next question comes from the line.

Oh for Gary Nachman, BMO capital C N N S O N.

Rene D. Gal: Yeah, I'd say, without giving specific guidance on what that would look like.

Hi, Good afternoon could you talk about the ozone reimbursement in excess cause I always have a net pricing has been trending for the narcolepsy indication what the initial status has been for I H have you been managing that and then what might change when an E. G O xyrem as <unk>.

Rene D. Gal: on what that would look like. We'll be focused on ensuring that in 2022, we're positioned to achieve our goal of having 65% of our revenues associated with those newer products, that is, Zywave, Epidiolex, Zepselka, and Rylase. And as you think about where our focus is, it's making sure that the long-term growth is positioning us to be able to achieve those operating margins. Of course, with the transaction, we did say that we expected accretion in the first full year.

Mailable next year, how much visibility have on that at this point.

And then just one other one if I could sneak it in just <unk> say there was a big acceleration it seemed in the third quarter. So you didn't comment on that in the prepared remarks, how much of that isn't that pricing versus actual demand volume.

Ah Kim maybe you could dress both those as I wave payer dynamics, now and going forward as well as soon as she progression of the third quarter.

Rene D. Gal: And we've also talked a lot about investing in our pipeline. So while we're going to be focused on improving our bottom-line margins, we're also going to be focused on ensuring that we're putting sufficient investment behind our R&D portfolio and pipeline to ensure that we're creating greater strength and greater durability.

Sure Yeah. So so <unk> you know, we're very pleased that we continue to have greater than 80% commercial coverage for patient.

Narcolepsy and this this really set set that well for for I H I think we've said we continue to see you know with the launch of I H really what we're looking to do is see uhm payors add basically utilization management criteria to the existing contracts.

Operator: Your next question comes from the line of Jeff Hung from Morgan Family. Your line is open.

Jeff Hung: Thanks for taking the question. You mentioned high persistency for the epidiolex indications. I guess from here on out, which indication do you see as the most important?

Jeff Hung: Thank you for taking the question. You mentioned high persistency for the Epidiolex indications. I guess from here on out, which indications do you see as the bigger potential drivers for Epidiolex sales, and what kind of impact do you expect going forward potentially from off-label indications? Thanks.

And coverage for XI weighed in that criteria anything specific to patients with I H in the meantime, and we're anticipating that that will happen as fast as if not faster than it did with the launch of narcolepsy, where I Bowl was and we saw a cheese yeah broad coverage.

Within six to nine months or so of lunch in the meantime, you know many patients can uhm pursue you know the medical exception crafts and kind of get coverage. There and then lastly, where that doesn't work, we do have patient access and support programs available for those patients.

Daniel N. Swisher: Dan or Kim, you want to jump in on Epidiolex? Yeah, I'm happy to start, and then Kim, you can add in. But, as I mentioned in the earnings call, especially as the COVID-19 pressures ease, and based on the real world experiences that we've had with physicians who've adopted the therapy, that there's plenty of room for patient growth across all three of our indications. And kind of more broadly, there's this pool of treatment-resistant epilepsy patients, you know, 160,000 pediatric and a million overall.

You know starting to read one day one of lunch I think the next question, perhaps was about what my toes in terms of you know V. H E. N. R. R coverage situations, we feel quite confident that we will continue to enjoy uhm strong coverage based on our <unk>.

Your stations with with payers in the space and now we don't anticipate.

Daniel N. Swisher: Many of them are with syndromes that are not, that have no FDA approved therapies and so often the physicians are looking at, The seizure types for those disorders, and given that epidiolex has a broad range of activity across multiple seizure types and good market access, you know, to support physicians and patients in those settings, you know, like most anti epilepsy drugs, we do think that epidiolex will become a cornerstone of therapy across multiple seizure types beyond the the indicated label.

And anticipate for them to really change the coverage and ultimately to put down the a G side by side.

With with Xyrem, specifically on their formulary not advantages or disadvantages it in any way.

And then Tim May I interest to comment on what we saw on C. N O C. In the in the third quarter.

Yeah sure. So in in the third quarter, we saw that you missed a nosy sales more than doubled compared to the same period last year every soft prescriptions, specifically you know uhm increased by eight per cent in third quarter over the second quarter.

Kim Sablich: Kim, I don't know if you want to add anything. Yeah, I think you covered everything.

Kim Sablich: Yeah, I think you covered all the points well, Dan.

You know since largely seem very encouraging reactions to the profile of the nosy from both our physicians and our patients and we continue to receive positive feedback from those who've actually utilize the product and the patients have a really good experience answer nosy in terms of what they're seeing the impact on them excessive daytime sleepiness and.

Operator: Your next question comes from the line of Ami Fadia from Needham. Your line is open. Good evening, thanks for taking the question.

Ami Fadia: Just more on Epidiolex.

Ami Fadia: Give us some more color on where you are with the patent application; you indicated that you expect it to be initiated, sorry, to be issued by the end of the year, so maybe some more color there, and then, just with regard to the myotronic atonic seizures, why did you pick that? What was the basis on which you thought that there was applicability to that in that seizure type. And if you could,

Oh these are patients and often quite fresh free free to debate rotated through other weight promoting agents and stimulants overtime Uhm I don't have the breakdown of that growth and so what was demand and uhm what was Christ's I I don't know Renee if you have that or not.

Yeah, I don't I don't have that in front of that but you know certainly we saw.

Ami Fadia: And if you could give us some preliminary sense of what the target market potential is if it works in that seizure type, thank you.

Most to net stabilize a few quarters after launches as we finalized our abroad access so what you're seeing now.

Bruce C. Cozadd: Yeah, I mean, nothing more to add on the timing of the new patent issuance and the Orange Book thing, and I'm not sure the timing of that is particularly important other than, obviously, what the long-dated expiration of that patent would be. Rob, maybe you could talk a little bit about why we've elected to go into the EMOS trial next, and then Kim or Dan, you can talk about potential in that marketplace as well. Rob?

Almost exclusively represents volume growth.

Okay, great. Thank you.

Your next question comes from the lineup I cashed in worrisome Jeffrey Atlantis Okay.

Hey, guys and I apologize for this question being a bit on the nose, but what is the current market penetration for Epidiolex in Gravette L. G. S T a T and other refractory epilepsies.

And then maybe on guidance it looks like for your guidance was lowered 70 million for SG&A R&D about $45 million and you talked about kind of three different reasons for that how much of the Opex decrease was spend if that was supposed to occur in 2021 going to 2022, given COVID-19, and how much of that was.

Robert Iannone: Yeah, happy to Bruce. So, you know, first of all, there's an important unmet medical need for EMOS amongst pediatric epilepsies, and based on prior data and other seizure disorders, we think there's a high probability that working in that setting will have a direct benefit to those patients. We also think it adds just evidence of broad anti-epileptic activity of epidiolex by studying a syndrome that is known to have a seizure type that is different than we currently have an indication for.

CW integration and R&D prioritization can we expect a more for Q like cost basis going forward into next year or not thank you.

So Dan or Kim maybe I'll ask you to talk a little bit about using our existing indications and where we are there in terms of.

Room for growth and then Renee, perhaps I can ask you to weigh in on the cost side.

Yeah, I mean sure what what I'll basically say is that where you know please with the pertinent penetration rate. Please we're seeing I think we share the specific data on that but you know what what we see is that there is.

Robert Iannone: And so it'll complement the seizure types that we've already addressed in our indications. And as you know, doctors treat the seizure types; they don't necessarily treat the underlying disorder as part of the epileptic therapies. And so it provides that additional data on broad activity across seizure types. And, you know, while we wouldn't promote off-label use, these are the kinds of data that physicians often look for to provide evidence of efficacy in the patients that they're intending to treat. Yeah, just jumping in there. You know, EMAS represents approximately 2%.

<unk> room for growth, particularly N L. G S. In our newest indication around PST. So we remain very encouraged in terms of you know the the growth opportunity for for this product across the indications.

Yeah, and maybe I'll just add in weathers some use outside of those disorders. There's clearly a lot of it's a very small penetration into that treatment resistant patient population, whether it's the pediatric population of 160000 or the million overall.

Daniel N. Swisher: of Childhood Epilepsies. So it is not an insignificant disorder, but you know, even more importantly, it rounds out our.

So again I think the real world experienced plus data set will continue to support strong growth going forward.

Daniel N. Swisher: That even more importantly, it rounds out our data set, which includes strong activity and combinability and safety and tonic, atonic, and now myoclonic and clonic seizure types. So it's just painting the broad evidence generation across multiple seizure types that are typically seen in this treatment-resistant epilepsy population. So, along with other studies we're considering and investigator-sponsored studies both looking at disorders, safety, efficacy endpoints, and other endpoints where we see benefits beyond seizure type or seizure reduction are part of our overall evidence.

Do we know what percent of sales is in the other refractory epilepsies as a percent of total search for Epidiolex right now.

Yeah, we're not providing that level of detail at this point.

And I'm happy to jump and then on Opex. So really the the categories of course that I provided are where we're seeing the biggest part of the chest and opex, we're trying to be very thoughtful about how we integrate jazz and G. W.

Uhm much of which has already been completed and as we prioritize some of these activities be it on the commercial side of R&D activities. It's really focused on where are we going to get the maximum value. When we initially provided our guidance and all that forward and the prior call we were continuing.

Operator: Your next question comes from the line of Gary Nachman from BMO Capital. Your line is open.

Gary Nachman: Hi, good afternoon. Could you talk about the overall reimbursement and access for XyWave, how the net pricing has been trending for the narcolepsy indication, what the initial status has been for IH, how you've been managing that? And then what might change when an AG of XyRM is available next year? How much visibility do you have on that at this point? And then just one other one, if I could sneak

To learn how the operations were coming together continuing to figure out what we needed to invest appropriately behind our uhm combined pipeline and our commercialization activities and we're also looking at how we should operate moving forward as a larger cause.

Bind company and how to be more effective and efficient as we prepare ourselves to scale with our increased revenue growth overtime. So that's largely high would encourage you to think about the way that we've brought down the expenses and then I would also say with respect to <unk>.

Gary Nachman: Just on Tenosy, there was a big acceleration, it seems, in the third quarter. So you didn't comment on that in the prepared remarks. But how much of that is net pricing versus actual demand volume?

Five Q4 numbers I wouldn't immediately apply those to our future our future rates as I mentioned earlier will provide specific guidance for 2022 as we report out our year end earnings in early 20th 21, and then I.

Gary Nachman: Thanks. Uh, Kim, maybe you could address both those, uh, Zywave payer dynamics now and going forward, as well as the NoC progress in the third quarter. Sure, yep. So with Zywave, we're very pleased that we continue to have greater than 80% commercial coverage for patients with narcolepsy. And this really sets us up well for IH. I think we've said, and we continue to see, you know,

I'd also just uhm remind you we stated in our prepared remarks that in queue for we're launching uhm I H. We're also initiating multiple clinical studies, sorry, clinical studies and a quarter and so there is some expense that's associated with with taking.

Kim Sablich: You know, with the launch of IH, really what we are looking to do is see.

On initiation and getting those underway.

As a reminder of P. C makers asked the one question each thank you. Your next question comes from Atlanta.

Kim Sablich: Payers Add basically is

Kim Sablich: Utilization Management Criteria to the existing contract and coverage for Zywave and that criteria being specific to patients with IH, you know, in the meantime, and we're anticipating that that will happen as fast as, if not faster than it did with the launch of Narcolepsy, you know, where our goal was, and we saw us achieve, you know, broad coverage within six to nine months or so of launch. In the meantime, you know, many patients can pursue, you know, the medical exception process and get coverage there. And then, lastly, where that doesn't work, we do have...

Yeah, I thought from ever for your line is open.

Are you there.

A matter of fact I'm ever quiet Lane is open.

Your next question comes from the line of my <unk> from my Clean your line is open.

Hi, good afternoon. Thanks for the questions I, just want to probe disclose epidiolex a bit farther.

Right I understand that you had limitations on accessing pediatric <unk> of the data point and interactions going down you gave us quite insightful.

What I'm struggling to understand is the lack of vaccine and how that's impacting on the ground I'm surprised the bands with kids are suffering from at left Epaulet.

Epileptic conditions are not accessing are getting the treatment needed me.

Kim Sablich: You know, patient access and support programs available for those patients, starting with day one of launch.

Maybe some qualitative or quantitative comments on it and secondly, maybe just on the individual market to do have a better understanding of the current market size off.

And then I'll <unk> drove it syndrome currently and what's the what's the number of patients that are out there and.

Kim Sablich: I think your next question perhaps was about what might change in terms of, you know, the AG and our coverage situation. You know, we feel quite confident that we will continue to enjoy strong coverage, based on our conversations with payers in this space. You know, we don't anticipate for them to really, you know, change the coverage and ultimately put down the AG side by side with Xyrem specifically on their formulary, not advantaging or disadvantaging in any way.

Penetration.

Thank you.

Yeah on the first part of the question, maybe maybe I'll just jump in and and talk a little bit about what I've heard from parents and traders during this period, which is.

Parents of <unk> of kids with these refractory a seizure disorders, you know or.

Very interested in getting to better seizure control and and you know better all over overall health status of their child, but they can be worried that in the process of changing meds you can disrupt in a way that can can actually bring on.

Kim Sablich: And then, Kim, maybe just a comment on what we saw in Sanosi in the third quarter.

Kim Sablich: Yeah, sure. You know, so in the third quarter,

Kim Sablich: and we saw prescriptions specifically, you know, increase.

Additional seizures during that change in those additional seizures can in some cases.

Kim Sablich: Page PAGE of NUMPAGES www.verbalink.com Page PAGE of NUMPAGES

A result in needing to visit a hospital and so we think based on conversations again with both a.

Rene D. Gal: Second Quarter. So, you know, since launch, we've seen very encouraging reactions to the profile of Spinozi from both our physicians and our patients. And we continue to receive positive feedback from those who have actually utilized the product. You know, patients have a really good experience with Spinozi in terms of what they're seeing is the impact on their excessive daytime sleepiness. And, you know, these are patients who have often been quite frustrated that they've rotated through other weight-promoting agents and stimulants over time. But I don't have the breakdown of that growth as to what was demand and what was price. I don't know, Renee, if you have that or not.

Parents as well as traders that there's been a tendency to avoid making those changes for fear of having to go into a medical environment.

And risk Covid with Unvaccinated kids. During this period, we don't think that's unique to epidiolex as a product. We think that's more general for these treaters in these conditions generally.

Your next question comes from the lineup S. Sir John Vandalism U D. S. Your line is open.

[noise] Hey.

Thanks for giving me the question I'm Gonna add to the list stuff Epidiolex questions here I guess for the U S market can you share any early feedback from subscribers in families and basically trying to get a sense for pent up demand and and to develop E markets and then B E and the you asked someone to have a patient can.

Rene D. Gal: I don't have that in front of me, but certainly we saw that Gross Connect stabilized a few quarters after launch as we finalized our broad access. So what you're seeing now almost exclusively represents volume growth.

You sure, but any at the new address license Tesla are used in combination with Epidiolex Uhm and then lastly can you give us some color on the proportion at the T. W stands for if that continues to be employed by jazz and.

Operator: Your next question comes from the line of Akash Tewari from Jeffrey. Your line is open. Hey guys.

Akash Tewari: Hey guys, and I apologize for this question being a bit on the nose, but what is the current market penetration for Epidiolex and Dravet, LGS, TST, and other refractory epilepsies? And then maybe on guidance, it looks like full year guidance was lowered, $70 million for SG&A, and R&D, about $45 million. And you talked about kind of three different reasons for that. How much of the OPEX decrease was spend that was supposed to occur in 2021 going to 2022, given COVID-19, and how much of that was GW integration and R&D prioritization? Can we expect a more 4Q-like cost basis going forward into next year or not?

And whether you've had to expand hiring ethics and your last name is <unk>.

Yeah, maybe.

Oh, sorry go ahead.

Yeah, I was just going to jump in on the X U S. And then the the the other questions but on the side.

Got a strong team much like we had in the U S that GW of built up in the major market countries and importantly, the gating factor of course is getting a favourable reimbursement and we've now achieved that in four of the five major countries and that really opens the gate.

Two full promotion and rollout and in the fall we've got the additional sort of growth going on with the two markets that most recently got that reimbursement, which were Italy and Spain.

We're very targeted now on the fifth remaining country, which is France, which could be a very significant growth market for us and that one we anticipate the launching into in 2022, and I think relative to other sort of orphan price.

Bruce C. Cozadd: Thank you. So Dan or Kim, maybe I'll ask you to talk a little bit about how it is used in our existing indications and where we are there in terms of room for growth. And then Renee, perhaps I can ask you to weigh in on the cost side.

I handed products to have overall price in in these major countries, a greater than 70% of the wholesale acquisition cost in the US is a very very successful and it really speaks to both the market need the product profile and the data that's been generated so.

Daniel N. Swisher: Yeah, I mean, sure. What I'll basically say is that we're, you know, pleased with

Unknown Executive: Transcripts provided by Transcription Outsourcing, LLC.

You know, we look forward to further updates, but that definitely was a big part of our evaluation of Epidiolex was the worldwide potential for this <unk>.

Unknown Executive: Transcription by Transcription Outsourcing, LLC.

Daniel N. Swisher: You know, the growth opportunity for this product across indications.

Or a new therapy.

And then I'll jump in on the last question operator, I think we we're not quite done so on the sales force.

Daniel N. Swisher: Yeah, and maybe I'll just add that while there's, you know, some use outside of those disorders, there's clearly a lot of it has a very small penetration into that treatment-resistant patient population, whether it's the pediatric population of 160,000 or the million overall. So again, I think the real world experience plus data set will continue to support strong growth going forward. But do we know what percent of sales are in the other refractory epilepsies as a percent of total sales for epidiolex right now? Yeah, we're not providing that level of detail at this point.

The North American business unit within GW, the Greenwich team was brought over in its entirety.

To to jazz so no there's been no reduction in that effort again, we're trying to build on the success that GW was having.

And move forward together.

On the the question about combination use with <unk>.

Would say in general we see combination use of products.

Rene D. Gal: And I'm happy to jump in on OPEX. So really, the categories, of course, that I provided are where we're seeing the biggest part of the shift in OPEX. We're trying to be very thoughtful about how we integrate Jazz and GW, much of which has already been completed.

For these conditions, we hear good feedback about combination of Epidiolex with other agents I in terms of its side effect profile in terms of ease of initiation of adding epidiolex in.

Rene D. Gal: And as we've prioritized some of these activities, be it on the commercial side or R&D activities, it's really focused on where we are going to get the maximum value. When we initially provided our guidance and rolled that forward in the prior call, we were continuing to learn how the operations were coming together, continuing to figure out what we needed to invest appropriately behind our combined pipeline and our commercialization activities. And we're also looking at how we should operate moving forward as a larger combined company and how to be more effective and efficient as we prepare ourselves to scale with our increased revenue growth over time.

We hear that when patients are rotating off therapies. They often preferentially continue on epidiolex. So I'm not sure I have lots of quantitative data on <unk>, specifically at this point, but I I'd say, while we hear about use of Epidiolex general seems to be what.

We're hearing here as well.

Yeah, Bruce I'll, just throw in a couple of truth points, Let me know Dan shared earlier that what we're seeing in market research is at about 40% of respondents indicate they are you know moving epidiolex up in their treatment algorithm. So we see that is a very good techno and believe it's underpinned by more prescribers having positive.

Rene D. Gal: So that's largely how I would encourage you to think about the way that we've brought down the expenses. And then I would also say with respect to the implied Q4 numbers; I wouldn't immediately apply those to our future rates. As I mentioned earlier, we'll provide specific guidance for 2022 as we report out our year-end earnings in early 2021. And then I would also just remind you, as we stated in our prepared remarks, that in Q4, we're launching IH. We're also initiating multiple clinical studies, sorry, clinical studies in the quarter. And so there is some expense that's associated with taking on initiation and getting those underway.

<unk> with Epidiolex overtime and gaming experience with the product and then the other point is that we see very strong or assistance with the product one patients go on this product.

They stay on it for a really long time, so I think both of those are data point that point to let.

Level of satisfaction out there in the market on the part of both prescribers and patience.

Your next question comes from the lineup Ronnie Gal Sunday.

Okay.

Good afternoon, and thank you for taking my question.

Just about <unk>.

Of the product of the pick for the Irwin as marketable around 200 million Hey come I came down to around 170 during the year. When there was not enough supply and I was kind of wondering as you know have more information with the Riley's launch where do you see the end of the initial ramp up where you simply replace Irwin as.

Operator: As a reminder, please limit yourself to one question each. Thank you.

Operator: Your next question comes from the line of Umar Rafat from Evercore. Your line is open. Umar, are you there? Amirah Fox from Evercore. Your line is open. Your next question comes from the line of Balaji Prasad from Barclays. Your line is open.

And versus where you'll have to start building.

The demand further with some marketing just going to help us up.

Look at the shape of that product for the next couple of years.

Balaji V. Prasad: Hi, good afternoon. Thanks for the questions. I just want to discuss epiidiotics a bit further. While I understand that you had limitations in accessing pediatricians, the data points and interactions going down you gave are quite insightful. What I'm struggling to understand is the lack of vaccines and how that's impacting on the ground. I'm surprised that parents with kids suffering from epileptic conditions are not accessing or getting the treatment needed. Maybe you can make some qualitative or quantitative comments on it.

Yeah, Dan maybe I could ask you to jump in on just the overall market opportunity with with Riley's moving forward both.

Sandbox U S as well.

Yeah, No. That's a good question runny and I I think we don't quite know how big the market could become because there's you know as we ran into those goodbye constraints no more than five years ago, we pulled back all promotional efforts all medical education initiatives and we had to put in fairly strict.

Or in policies, where it was on a patient by patient basis and institutions really into triage, which patients got the therapy. So I think in addition to growing back the market fully there's also the retraining of physicians and caregivers, having the opportunity that at the slightest hyper.

Balaji V. Prasad: And secondly, maybe just on the individual markets, do you have a better understanding of the current market size for Lennox-Castor and Dravet syndrome currently? What's the number of patients that are out there, and penetration, if you have any?

Sensitivity reaction you don't continue to reach alonge as they may have during shortages and sort of risk anaphylactic shock, but you give the opportunity to switch more quickly to a non E. Coli based our spirits, Denise and importantly would riley's given that we had a year supply at the time of launch and very robust.

Daniel N. Swisher: Yeah, on the first part of the question, maybe I'll just jump in and we're going to talk a little bit about what I've heard from parents and treaters during this period, which is... You know, parents of kids with these refractory seizure disorders are very interested in getting to better seizure control and a better overall health status for their child, but they can be worried that in the process of changing meds, you And so we think, based on conversations, again, with both parents, as well as with providers, that there's been a tendency to avoid making those changes for fear of having to go into a medical environment and risk COVID with unvaccinated kids during this period. We don't think that's unique to Epidiolex as a product. We think that's more general for these treatments and these conditions, generally.

Supply chain, the institutions and <unk>, who worked with US on the study have great confidence that they.

They can they can look for silent and activation look for the hypersensitivity reaction and really grow the market.

Said in addition to that there is an opportunity to go more fully into adolescence and young adult.

Wishes could be sizeable and there's more drug use there because it's on a per weight basis, and then there's geographies like Japan that have the unmet need where the product never got introduced because of supply and quality of Susan Youre Riley's is in a very different situations. So you'll look forward to.

Giving sort of further color to exactly what that potentially could be but we do see it as a growth driver for the immediate future.

Your next question comes from the line a friend and foe from Cantor Fitzgerald. Your line is open.

Alright, Thanks for taking my question and I just want a circle.

Back to sideways.

The goal of having 50%.

Pay with more than 50% of patients.

On the highway and by 2023, and you seem to want any way they but maybe can you just talk about how dependent achieving that goal is on IH. Thank.

Operator: Your next question comes from the line of Esther Rajavelo from UBS. Your line is open. Hey, thanks for giving me the question. I'm going to add to the list of epidiotic questions here. I guess for the sake

Thank you.

Yeah, maybe I'll jump in on that one and just say we picked a date a little farther out in this metric of 2023, because we specifically wanted to address what we think would happen to XI waive even in the face of competition from a generic or Brandon.

Esther Rajavelo: OUF Markets. Can you share any early feedback?

Unknown Attendee: [inaudible]

Unknown Attendee: U.S. among DRAV-A patients, can you share whether any of the newer drugs, like

Higher sodium.

Oxford bait. So it wasn't so much just a continuation of the existing trend and where we'd get too, but where we'd still be after potential other entrance to the marketplace. So hopefully that makes that a metric a little bit clearer to you. We do see a very significant opportunity and idiopathic hypersomnia with.

Unknown Attendee: and Tepla are used in combination.

Unknown Attendee: with Epidiolex. And then lastly, can you give us some color on the proportion of the GW?

Unknown Attendee: W Salesforce, that continues to be employed by.

Unknown Attendee: Jazz, and whether you've had to expand hiring efforts in the U.S.

Unknown Attendee: and hiring efforts in the U.S. for this product.

Daniel N. Swisher: Don't ask too much Dan, I'll just... Go ahead Dan.

No indicated treatments prior to our launch last week of Skywave.

Daniel N. Swisher: Yeah, I was just going to jump in on the ex-U.S. side and then leave the other question. But on the ex-U.S. side, you know, we've got a strong team, much like we had in the U.S. that GW had built up in the major market countries. And importantly, you know, the gaining factor, of course, is getting favorable reimbursement. And we've now achieved that in four of the five major countries. And that really opens the gate to full promotion and rollout.

Patients, who really need effective therapy.

To treat excessive daytime sleepiness, but but symptoms even beyond that.

N I H.

This is a new launch no product has been promoted in this space before so we do have some education to do.

It's also a little unlike sideways.

In narcolepsy, where many of ours highway patients were coming over already titrated up and on Ah effective dose of Xyrem, and then moved overdose for dose.

Daniel N. Swisher: And, you know, in the fall, we've got additional growth going on with the two markets that most recently got that reimbursement, which were Italy and Spain. We're very targeted now on the fifth remaining country, which is France, which could be a very significant growth market for us. And that one, we anticipate to be launching into in 2022.

Obviously, a naive IH patients coming on would be titrated up on dose.

Overtime, so a little bit different dynamic in terms of uptake, but but we certainly see that as a significant opportunity potentially over time rivaling the size of narcolepsy in terms of potential overall patients with better diagnosis and treatment and we're not predicting that in the near term but.

Daniel N. Swisher: I think relative to other sort of orphan price branded products, having overall pricing in these major countries that is greater than 70 percent of the wholesale acquisition cost in the U.S. is very, you know, very successful. And it really speaks to both the market need, the product profile, and the data that's been generated. So, you know, we look forward to further updates, but that definitely was a big part of our evaluation of Epidiolex was the worldwide potential for this important new therapy. And then I'll jump in on the last part of your question. Operator, I think we were not quite done.

Certainly that opportunity is there for a really substantial.

Improvement for a number of patients by H.

Your next question comes from the line of David and Solomon from Viper Sandler Atlantis open.

Thanks on Epidiolex with the the clear evidence of some off label use beyond the free.

Indications in the in the U S label I was wondering if I could get her thoughts on payer contracting and just trying to get more aggressive with pair such that you could facilitate less in the way of utilization management, how do you think about that.

Daniel N. Swisher: So on Salesforce, you know, the North American business unit within GW, the Greenwich team was brought over in its entirety, uh... to jazz, so no, there's been no reduction in that effort uh... again, we're trying to build on the success that GW is having uh... and move forward together. On the question about combination use with Pentepla, you know, I would say, in general, we see combination For these conditions, we hear good feedback about the combination of epidiolex with other agents in terms of its side effect profile, and in terms of ease of initiation of adding epidiolex to. We hear that when patients are rotating off treatments, they often preferentially continue on Epidiolex. So I'm not sure I have lots of quantitative data on Fintepla specifically at this point, but I'd say what we hear about the use of Epidiolex in general seems to be what we're hearing here as well.

And then I'm sorry, if I missed this but are you disclosing or did you disclose the <unk> contribution from put the ilex during the quarter. If you can disclosed that that'll be helpful too. Thanks.

Yeah, David I'll take the second half of your questions here I don't think we've provided a specific U S vs X U S breakdown product by product.

But we're really excited about how the Epidiolex launch continues to roll out.

In Europe across markets, both in terms of.

Pricing and access were receiving.

But also how our teams are performing in the early periods of these launches and see this is a really significant opportunity relative to the U S.

Overtime.

Bruce C. Cozadd: Yeah, Bruce, I'll just throw in a couple of proof points.

On payer coverage and what that means in terms of utilization.

Daniel N. Swisher: I know Dan shared earlier that what we're seeing in market research is that about 40% of respondents indicate they are, you know, moving epidiolics up in their treatment algorithm. So we see that as a very good signal.

Of the product Kim could I ask you to weigh in on that.

Yeah sure.

So right now, we're very pleased that epidiolex enjoy and 98% commercial coverage across <unk> commercial lives at.

And yes, and do you think that we are you see it as a strategic priority and we are focused on trying to broaden that coverage. So that coverage and then the indicated.

Daniel N. Swisher: and believe it's underpinned by more prescribers having positive experiences with Epidiolex over time and gaining experience with the product, and then the other point is just we see very strong persistence with the product; once patients go on this product, they stay on it for a really long time. So I think both of those data points point to levels of satisfaction out there in the market on the part of both prescribers and patients.

Lives that we have we are working with payors to try to broaden that coverage and we've been very successful on that front and the Medicaid space and are continuing to try to get there in the commercial space.

Your next question comes from the Linux can Pasha twice I'm Coleman Company. Your line is open.

Hey, Bruce and team, Sir I'm really late getting on the call, but I wanted to go back and ask about your reference to the Epidiolex composition of matter like patterns can you get into a little bit of nuance on on these patents more in the specificity of them with just being worked on for awhile. It at G. W.

Daniel N. Swisher: They're in the market now. I'm a part of the team of both prescribers and patients.

Operator: Your next question comes from the line of Ronnie Gao from Bernstein. And good afternoon, and thank you.

Ronnie Gao: Good afternoon, and thank you for taking my question. Just about Rylai's, you know, the peak of the product, the peak for Erwin A's market, was around $200 million. It kind of came down to around $170 during the year when there was not enough supply. And I was kind of wondering, as you now have more information with the Rylai's launch, where do you see the end of the kind of initial ramp-up where you simply replace Erwin A's and versus where you'll have to start building?

What are your original diligence and you were aware of them something that maybe you help them with can you give a little more specificity around them. Thank you.

Yeah can this is something we were aware GW was working on I think GW did make reference to it publicly on a couple of.

Occasions, we're getting more specific now just about timing.

Ronnie Gao: the demand further with some marketing just kind of help us look at the shape of that product for the next couple of years. Yeah, Dan, maybe I could ask you to jump in on just the overall market opportunity with Riley's moving forward, both us and x us as well. Yeah, no, it's a good question, Ronnie.

I think we'll wait to say more until that pattern is visible to everyone and we can talk about it more specifically I don't think it makes sense to do so right now but.

Obviously, what we're trying to communicate is that the IP continues to broaden that it has different pieces to it I and can have different expiration dates in this case out to 2039, so more to come when we have more in the public domain, but just wanted to make sure.

Daniel N. Swisher: And I think we don't quite know how big the market could become because, as you know, as we ran into those supply constraints more than five years ago, we pulled back all promotional efforts, all medical education, and initiatives. And we had to put in fairly strict ordering policies where it was on a, you know, patient by patient basis. And, you know, institutions really had to triage which patients got the therapy.

People are focused both on the near term Ah.

Opportunity for Epidiolex in the U S.

In the X U S launch that's on your way in potential new indications in broader use but also recognize that we view this as a very durable asset.

Daniel N. Swisher: So I think in addition to, you know, growing back the market fully, there's also the retraining of physicians and, you know, caregivers having the opportunity that at the slightest hypersensitivity reaction, you don't continue to reach challenges they may have during shortages and sort of risk anaphylactic shock, but you get the opportunity to switch more quickly to a non-E. coli-based asparaginase. Yeah, and importantly, with Rylase, given that we had a year supply at the time of launch and a very robust supply chain, the institutions and COG who worked with us on the study have great confidence that they can look for silent inactivation, look for that hypersensitivity reaction, and really grow the market.

Your next question comes from the lineup Greg for you Sir I'm curious security your line is open.

Good afternoon folks and thanks for taking the question.

What percentage of new to US debate patients are being prescribed highway versus Xyrem, you mentioned, a large majority, but can you be more specific and what are the reasons that you hear as to why us debate naive patience or are still prescribed syrah visit access related physicians just aren't aware of zywiec, yet any color on that would be helpful. Thanks.

Yeah, Gregg I, particularly like the end of that question. That's always a good question when you've got a better therapy, a superior therapy available Kim you Wanna talk a little bit about octavate naive patience and what we're seeing in what might be driving that.

Daniel N. Swisher: We said, in addition to that, there's an opportunity to go more fully into adolescent and young adult, which could be sizable. You know, more drug use there because it's on a per weight basis, and then there are geographies like Japan that have an unmet need where the product never got introduced because of supply and quality issues, and you know Rylase is in a very different situation. So, you know, look forward to giving sort of further color to exactly what that potential could be. But we do see it as a growth driver for our immediate future.

Yeah. So a couple of reasons. So uhm one is that while we have very strong commercial coverage over 80% and commercial patience. There is still a portion of patients that don't have immediate access to xyrem, though so that's one of the reasons, but really the biggest reason out there right.

Now is that healthcare xyrem is a patient's loved their xyrem and HCP love Xyrem and so the number one reason we're hearing.

Is that I'm sorry, that's on the transition that patients are satisfied with xyrem, but yeah. We still have some work to do as I said before with some segments of physician and really motivating them you know to to adopt the highway based on in a low sodium but we feel very confident that we're making strong.

Operator: Your next question comes from the line of Brandon Folkes from Cantor Fitzgerald. Your line is open.

Brandon Richard Folkes: Hi, thanks for taking my question. I just want to circle back to Zywave and the goal of having 50% of patients covered or more than 50% of patients on Zywave by 2023. You seem to be well on your way there, but maybe can you just talk about how dependent achieving that goal is on IH from here? Thank you.

Progress there and that these smaller segments of HCP will eventually.

In a move along that continuum and joined the rest of the high volume activate prescribers, who really you see the benefits of bowling with a product that lowers that 30 burden.

Your next question comes from Atlanta NFL.

I'm Stephanie.

It is open.

Annabel are you there.

I never sent me Nathan before and then it's open.

Bruce C. Cozadd: Yeah, maybe I'll jump in on that one and just say, you know, we picked a date a little farther out in this metric of 2023 because we specifically wanted to address what we think would happen to Zywave even in the face of competition from a generic or branded higher sodium Oxibate. So it wasn't so much just a continuation of the existing trend and where we'd get to, but where we'd still be after a potential other entrance to the marketplace. So hopefully that makes that metric a little bit clearer to you.

Your next question comes from the lineup, Nevada T from City. Your line is open.

Hi, good afternoon, and Tristan photo up on the lower than expected M. S. G E N R. A N D and you'd like to tell us which products will be impacted by then the lettuce onion.

Expensive.

Which will be privatized and then the second question is United stuff on their situation or there soon.

<unk> S. T 218 S. Taking action day rest of your day. Thank you.

Yeah I'll take the second part of your question first and just say nothing additional to say on the litigation.

Bruce C. Cozadd: You know, we do see a very significant opportunity in adiapathic hypersomnia with no indicated treatments prior to our launch last week of iWave. Patients who really need effective therapy to treat excessive daytime sleepiness, but symptoms even beyond that. NIH, you know, this is a new launch. No product has been promoted in this space before. So we do have some education to do.

Ongoing with around the F. T 218, obviously, we have.

Existing IP, which is you've seen more of over time and will do.

Defend that IP as we see fit.

On the expense side.

Bruce C. Cozadd: It's also a little unlike Zywave in Narcolepsy, where many of our Zywave patients were coming over already titrated up and on an effective dose of Xyrem and then moved over dose for dose. You know, obviously, a naive IH patient coming on would be titrated up on dose over time. It's a little bit different dynamic in terms of uptake, but we certainly see that as a significant opportunity, potentially, over time, rivaling the size of narcolepsy in terms of potential overall patients with better diagnosis and treatment. We're not predicting that in the near term, but certainly, the opportunity is there for a really substantial improvement for a number of patients with IH.

You know what we were lowering here was guidance for the full year.

In terms of overall spending across to organizations that just came together a few months ago.

As well as our expectations in particular is we have more visibility late in the year Renee I'll I'll, let you weigh in on what else you wanted to disclose their.

Yeah actually I think you've covered it and I think just to address the specific question in terms of how does this look byproduct. If you think about the commercial side. Obviously, we have multiple product launches, we've been moving forward and the impacts of COVID-19 and that lack of it.

Person interaction that many companies had expected to grow in Q3, and Q4 has been impacted by Covid. So it's not specific to one product necessarily other than and I'm thinking about where we're really putting our commercialization dollars right now and that is.

Operator: Your next question comes from the line of David Amsellem from Piper Sandler. Your line is open.

David A. Amsellem: Thanks. So on Epidiolex, with the clear evidence of some off-label use beyond the three indications in the U.S. label, I was wondering if I could get your thoughts on payer contracting and just trying to get more aggressive with payers such that you could facilitate less in the way of utilization management. What do you think about that?

To support the new product launches that we've talked about representing that 65% of revenues that we expect and 2022 from those products that have been launched are acquired since 2019, so sideways epidiolex steps.

Bruce C. Cozadd: And then, I'm sorry if I missed this, but are you disclosing or did you disclose the ex-U.S. contribution from Epidiolex during the quarter? If you can disclose that, that would be helpful too. Thanks.

<unk> <unk> and.

Bruce C. Cozadd: Yeah, David, I'll take the second half of your question and say I don't think we've provided a specific US versus ex-US breakdown product by product. But we're really excited about how the Epidiolex launch continues to roll out. In Europe, across markets, both in terms of, you know, pricing and access we're receiving, but also how our teams are performing in the early periods of these launches, and see this as a really significant opportunity relative to the U.S. over time. On payer coverage and what that means in terms of utilization of the product, Kim, could I ask you to weigh in on that? Yeah, sure. So right now, we're very pleased that

And for Nancy.

This concludes our question and answer session I would know that I could turn the conference back to Mister Bruce How's that.

Yeah, Thanks, operator, and thanks to all of you for the good questions.

I'll just say, we're really happy with where we are this year in terms of Ah kicking off our fifth launch.

Continuing progress early in the launches of reilly's and continuing to progress <unk> you know a flurry of activity at the end of the year initiating some mid and late stage trials were really excited about.

You know your SAR delevering in the first five months I have turned which I think is really excellent progress and then the ability to bring more of this to the bottom line is we operate as a combined more agile company. So really excited about where we're headed.

Kim Sablich: We are focused on trying to broaden that coverage and so that coverage is in the indicated, you know, lives that we have. We are working with payers to try to broaden that coverage, and we've been very successful on that front in the Medicaid space and are continuing to try to get there in the commercial space.

And you know what's in front of us for 2022.

We look forward to speaking with many of you with the upcoming Jefferys, London, and Evercore investor conferences, and I'd, just like to recognize all our jazz colleagues for their efforts, which have led to delivering these new therapeutic options to patients and to thank our partners and shareholders for their continued confidence and support and thank everyone for joining us.

Kim Sablich: Your next question comes from the line of Ken Kasha-Twar from Cohen & Company. Your line is open. Hey Bruce and team, sorry I'm really late getting on the call.

Ken Kasha-Twar: Hey Bruce and team, sorry I'm really late getting on the call, but I wanted to go back and ask about your reference to the Epidiotic Composition of Matter-like Patents. Can you get into a little bit of nuance on these patents, more on the specificity of them? Was this being worked on for a while at GW, part of your original diligence, and you were aware of them, something that maybe you helped them with? Can you give a little more specificity about them? Thank you.

Today stay well everyone.

Ladies and gentlemen, this censorship.

They've got a fan. Thank you for your participation in and have a wonderful thing you may all disconnect.

Uh-huh.

[music].

Bruce C. Cozadd: Yeah, Ken, this is something we were aware GW was working on. I think GW did make reference to it publicly on a couple of occasions. We're getting more specific now just about timing. I think we'll wait to say more until that patent is visible to everyone and we can talk about it more specifically. I don't think it makes sense to do so right now. But, you know, obviously, what we're trying to communicate is that intellectual property continues to broaden, that it has different pieces to it, and can have different expiration dates, in this case, out to 2039.

Bruce C. Cozadd: So more to come when we, you know, have more in the public domain. But just wanted to make sure people are focused both on the near-term opportunity for Apidiolex in the U.S. with the XUS launch that's underway, potential new indications, broader use, but also recognize that we view this as a very durable asset.

Operator: Your next question comes from the line of Greg Fraser from Tourist Security. Your line is... Good afternoon, folks, and thanks for taking the question.

Gregory Daniel Fraser: You mentioned a large majority, but can you be more specific? And what are the reasons that you hear as to why obstinate, naive patients are still prescribed Zyrem? Is it access-related? Physicians just aren't aware of Zywave yet? Any color on that would be helpful.

Kim Sablich: Yeah, Greg, I particularly like the end of that question. That's always a good question. When you've got a better therapy, a superior therapy available. Kim, you want to talk a little bit about oxibate naive patients and what we're seeing and what might be driving that? Yeah, so a couple of reasons. One is that, you know, while we have very strong commercial coverage, over 80% in commercial pay.

Kim Sablich: And so the number one reason we're hearing is that, I'm sorry, that's on the transitions that patients are satisfied with Xyrem, but we still have some work to do, as I said before, with some segments of physicians and really motivating them to adopt XyWave based on the low sodium, but we feel very confident that we're making strong progress there and that

[music].

Kim Sablich: These smaller segments of HCPs will eventually move along that continuum and join

Unknown Executive: Transcript by Rev.com. Page of

Operator: Your next question comes from the line of Annabel Samimy from Stifel. Annabel, are you there? Annabel Samimy from CISL, your line is open. Your next question comes from the line of Navante from Citi. Your line. Hi, good afternoon. First, a follow-up on the lower than expected SG&E and R&D. Are you able to tell us which products will be impacted by the lower selling and R&D expenses or which will be prioritized? And then my second question is on your latest thoughts on the litigation versus Avadel FT218 after the action was delayed? Thank you.

Annabel Eva Samimy: Yeah, I'll take the second part of your question first and just say nothing additional to say on the litigation, uh, ongoing with uh around FT218. Obviously, we have Existing IP which you've seen more of over time, and we'll defend that IP as we see fit. On the expense side... What we were lowering here was guidance for the full year. In terms of overall spending across two organizations that just came together a few months ago, as well as our expectations, in particular, as we have more visibility late in the year. Rene, I'll let you weigh in on what else you want to disclose there. Yeah, actually. I think you've covered it.

Bruce C. Cozadd: And I think just to address the specific question in terms of how this looks by product, if you think about the commercial side, obviously, we have multiple product launches, we've been moving forward, and the impacts of COVID and that lack of in-person interaction that many companies had expected to grow in Q3 and Q4 haven't been impacted by COVID. So it's not specific to one product necessarily, other than in thinking about where we're really putting our commercialization dollars right now. And that is to support the new product launches that we've talked about representing the 65% of revenues that we expect in 2022 from those products that have been launched or acquired since 2019.

Operator: This concludes our question and answer session. I would now like to turn the conference back to Mr. Bruce Cozadd for his closing remarks.

Yeah, thanks, operator. And thanks to all of you for the good questions.

You know, I'll just say we're really happy with where we are this year in terms of kicking off our fifth launch, continuing progress early in the launches of Ryleys, and continuing to progress Zepselka, you know, a flurry of activity at the end of the year initiating some mid and late stage trials we're really excited about. You know, we saw our de-levering in the first five months, a half turn, which I think is really excellent progress, and then the ability to bring more of this to the bottom line as we operate as a combined, more agile company.

So, I'm really excited about where we're headed, and you know what's in front of us for 2022. We look forward to speaking with many of you at the upcoming Jeffries London and Evercore Investor Conferences, and I'd just like to recognize all our Jazz colleagues for their efforts which have led to delivering these new therapeutic options to patients and to thank our partners and shareholders for their continued confidence and support. Thank everyone for joining us today. Stay well, everyone.

Ladies and gentlemen, this concludes today's conference. Thank you for your participation and have a wonderful day. You may all disconnect.

© BF-WATCH TV 2021 ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? ?? ??

Good afternoon, ladies and gentlemen, and welcome to the third quarter 2021 Jazz Pharmaceuticals Earnings Conference. At this time, all participants are in a listen-only mode. After the speaker's presentation, there will be a question and answer session. To ask a question, you will need to press star 1 on your telephone. I would now like to turn the conference over to our host, Ms. Andrea Flynn, Head of Investor Relations. Ma'am, please go ahead. Thank you and good afternoon, everyone. Today, Jazz Pharmaceuticals reported its third quarter 2021 financial results.

[music].

The slide presentation accompanying this webcast is available in the Investors section of our website. Investors may also refer to the press release we issued earlier today, which is also posted on our website.

On the call today are Bruce Cozadd, Chairman and Chief Executive Officer, Rene Gala, Executive Vice President and Chief Financial Officer, Dan Swisher, President, and Rob Iannone, Executive Vice President, R&D, and Chief Medical Officer. Kim Sablich, Executive Vice President

and General Manager of North America, and Phil Jochelson, Neuroscience Therapeutic Head, will join for Q&A. On slide two, I'd like to remind you that today's webcast includes forward-looking statements, such as those related to our future financial and operating results, growth potential, and anticipated development and commercialization milestones and goals, which involve risks and uncertainties that could cause actual events, performance, and results to differ materially from those contained in these forward- We encourage you to review the statements contained in today's press release, in our slide deck, and in our latest SEC disclosure document, which identify certain factors that may cause the company's actual events, performance, and results to differ materially from those contained in the forward-looking statements made on today's webcast. We undertake no duty or obligation to update our forward-looking statements. Turning to slide three, on this webcast, we'll discuss non-GAAP financial measures.

Reconciliations of GAAP to non-GAAP financial measures are included in today's press release and the slide deck available on the Investors section of our website.

I'll now turn the call over to Bruce. Thanks, Andrea. Good afternoon, everyone, and thank you for joining us today.

I'll start on slide five. We remain laser-focused on executing our strategy across commercial, R&D, and corporate development, positioning Jazz to deliver sustained growth as we continue to build our high-value portfolio of commercial and clinical-stage therapies. In the third quarter, we continued to make progress in our transition to a diversified, innovative biopharma company by focusing on our three primary pillars. First, growing sales of existing products in our commercial portfolio, including through indication and geographic expansion.

The market-leading adoption of Zywave and Narcoleps and the top-tier launch of Zep Zelka in small cell lung cancer highlight our commercial execution across both our neuroscience and oncology therapeutic areas. The recent approval and launch of Xywave for Idiopathic Hypersomnia, or IH, showcases our ability to expand to new indications, in this case, where there are no other FDA-approved therapies.

Further, our progress in securing access to and reimbursement for Epidiolex across major European markets demonstrates our team's capabilities beyond the U.S. Our acquisition of GW Pharmaceuticals epitomizes our second strategic objective, Acquiring Differentiated Commercial Products and Late-Stage Programs. This acquisition brought in a high-growth, durable commercial product, NEPA Dialex, and expanded our R&D portfolio. Our third pillar is pursuing pipeline development of differentiated therapy.

Excluding the acquisition of GW, since 2015, our team has increased our pipeline assets fourfold, resulting in 11 product approvals. Now with the addition of the GW pipeline and cannabinoid, we are excited about a more robust pipeline that will further enhance that R&D product. Turning to several key highlights this quarter. In 2020, we established an aggressive target of completing five commercial launches in 2020 and 2021. I'm pleased to announce that earlier this month, we launched ZyWave for IH and adults, which meets that goal.

This represents a major milestone for Jazz, underscoring our ability to advance therapies from concept to commercialization and successfully execute on launches of differentiated products that address critical patient needs. The launch of XiWave for IH provides a significant growth opportunity for our Oxibate franchise, which we view as a durable core component of Jazz's long-term value that has multiple Orange Book listed patents that extend through 2033. We continue to expect that a majority of Oxybate patients across all approved indications will benefit from Zywave in 2023, which accounts for branded and generic higher sodium oxalate therapies entering the market.

[music].

With respect to the entry of authorized generic Xyrem, we plan to provide guidance for 2022, as usual, on our fourth quarter earnings call. At that time, we anticipate providing more information on the Xyrem authorized generic launch. The integration of GW continues to move ahead, and as I noted in the past, there is a superb cultural fit between the Jazz and GW teams.

Good afternoon, ladies and gentlemen, and welcome to the third quarter as Fannie Freddie why isn't jazz Pharmaceuticals earnings Conference call.

At this time all participants are in a listen only mode. After the speaker's presentation, there will be a question and answer session.

The acquisition is proving to be highly complementary to our existing commercial portfolio and has added the exciting GW cannabinoid platform and science to our R&D pipeline. That said, we acknowledge there is work to be done. While we have continued to grow Epidiolex in the U.S., there have been challenges in the face of the COVID-19 pandemic. Dan will provide more detail about how our commercial team is addressing these challenges to support further Epidiolex growth in the U.S. We continue to strengthen the durability of Epidiolex and now have 20 Orange Book listed patents with the majority extending through 2035.

That's a question you will need to press one on your telephone.

I would now like to turn the conference over to your host Ms. Andrea Flynn handle Investor Relations Ma'am. Please go ahead.

Thank you and good afternoon, everyone today Jazz Pharmaceuticals reported its third quarter 2021 financial results the slide presentation.

And pasting accompanying this webcast is available on the investors section of our web site investors May also refer to the press release, we issued earlier today, which is also posted to our website on the call today are Bruce <unk>, Chairman and Chief Executive Officer, Renee Gala Executive Vice President and Chief Financial Officer, Dan Swisher, President and Rob.

We are also generating additional IP, including a composition of matter patent that we expect will be issued later this year and listed in the Orange Book in the first quarter of 2022. This patent would expire in 2039.

Executive Vice President R&D, and Chief Medical Officer.

Kim Stabler Executive Vice President and General manager of North America, and still Jocko neuroscience therapeutic head will join for Q&A.

And I want to be very clear, we remain excited by the potential long-term value creation that the GW acquisition can deliver. And our confidence in Epidiolex's blockbuster potential and its importance as a component of our commercial portfolio has only increased since we brought it in-house. Turning to oncology, our ZepZelka team is executing a top-tier commercial launch. We are also advancing a robust clinical development plan, and Rob will provide more color on our R&D efforts for ZepZelka and across our portfolio later in the call.

On slide two I'd like to remind you that today's webcast includes forward looking statements such as those related to our future future financial and operating result growth potential and anticipate a development and commercialization milestones and goals, which involve risks and uncertainties that could cause actual events performance and results to differ materially from those contained in these forward.

Looking statements. We encourage you to review the statements contained in today's press release, and our slide deck and in our latest SEC disclosure documents, which identify certain factors that may cause the company's actual events performance and results to differ materially from those contained in our forward looking statements made on today's webcast, we undertake no duty or obligation.

On June 30th, we are pleased to announce approval of RILAs under FDA's Real-Time Oncology program. While we're early in the launch, we believe that Rylase will become the standard of care for patients who need a non-E. coli derived asparagin. With respect to our financial performance, our third quarter delivered a 39% increase in total revenues compared to the same quarter last year.

To update our forward looking statements.

Turning to slide three on this webcast, we will discuss non-GAAP financial measures reconciliations of GAAP to non-GAAP financial measures are included in today's press release and the slide deck available on the investors section of our website.

We continue to diversify our revenue, with more than 50% of net product sales coming from products launched or acquired since 2019, in stark contrast to a year ago when this same metric was just 8%. These newer products are not only innovative medicines that address critical needs for patients with neurologic disorders and cancer, but they're also durable, long-lived therapies that support our strategy of building a diversified, high-growth commercial portfolio. Our strong cash flow and disciplined capital allocation are enabling us to invest in the growth of our business while staying on track to meet our deleveraging goals.

I'll now turn the call over to Bruce.

Thanks, Andrea good afternoon, everyone and thank you for joining us today I'll start on slide five.

We remain laser focused on executing our strategy across commercial R&D and corporate development positioning jobs to <unk>.

Liver sustained growth as we continue to build our high value portfolio of commercial and clinical stage therapies.

In the third quarter, we continued to make progress in our transition to a diversified innovative biopharma company by focusing on our three primary pillars first growing sales of existing products in our commercial portfolio, including through indication and geographic expansion.

With a strong foundation, exciting new opportunities, and continued execution against our plan, I remain highly confident in Jazz's future. I'll now turn the call over to Dan for an overview of our commercial performance, after which Rob will share an update on progress across our R&D program. Rene will provide a financial overview, and then we'll open the call to Q&A. Dan, over to you. Thanks, Bruce.

The market, leading adoption of XI wave in narcolepsy and top tier launch or does that zilkha in small cell lung cancer highlight our commercial execution across both our neuroscience and oncology therapeutic areas. The recent approval and launch because highway for idiopathic hypersomnia or I H showcase.

Well, I'm excited to share the progress across our commercial portfolio. Starting with neuroscience, we saw strong momentum during the third quarter for our OxyBait franchise. Average active occipate patients increased to approximately 16,000 in the quarter, a 6% increase over the same period last year, and we exited the quarter with approximately 6,000 active ZyWave patients, up from approximately 5,100 at the end of the second quarter. We see significant opportunity for Zywave to continue to grow in narcolepsy and remain focused on educating physicians and patients about the lifelong burden of high sodium intake, particularly in a patient population like this one with an increased risk of cardiovascular comorbidities.

Our ability to expand to new indications in this case, where there are no other FDA approved therapies.

Further our progress in securing access and reimbursement for rapid dialects across major European markets demonstrates our team's capabilities beyond the U S.

Our acquisition of GW Pharmaceuticals, epitomizes, our second strategic pillar acquiring differentiated commercial products in late stage programs.

This acquisition brought in a high growth durable commercial product and up of dialects and expanded our R&D portfolio.

Our third pillar is pursuing pipeline development of differentiated therapies.

In addition to the strong adoption of Zywave from existing Zyrum patients, we continue to see the large majority of oxybate naive patients being prescribed Zywave as opposed to Zyrum. As slide 7 illustrates, we've achieved market-leading adoption for ZyWave in narcolepsy relative to the launches of other next-generation neuroscience products. This speaks to the strong product profile, which includes FDA's published findings of the clinical superiority of ZyWave to Zyrum based on greater safety because of reduced sodium, as well as our deep understanding of the sleep space and our ability to successfully drive adoption of new therapies.

Excluding the acquisition of GW since 2015, our team has increased our pipeline assets four fold, resulting in 11 product approvals now with the addition of the GW pipeline and cannabinoid platform. We're excited about a more robust pipeline that will further enhance that R&D productivity.

Turning to several key highlights this quarter.

In 2020, we established an aggressive target of completing five commercial launches in 2020 and 2021.

I'm pleased to announce that earlier this month, we launched XI wave for IH in adults, which completes that goal.

This represents a major milestone for jazz underscoring our ability to advance therapies from concept to commercialization and successfully execute on launches of differentiated products that address critical patient needs.

And we believe the IH indication will drive further growth for ZyWave. Our commercial launch began on November 1, and I'll remind listeners that a replay of our October webcast discussing the commercial launch strategy of ZyWave for IH is available on our corporate website for those who missed it. As we roll out this launch, our initial focus is on driving awareness and adoption among existing Oxybate prescribers and the approximately 37,000 people who have been diagnosed with IH and are actively seeking health care. Spanning the market beyond diagnosed IH patients who are actively seeking treatment provides us with a longer-term growth opportunity, and we estimate.

The launch of his highway for IH provides a significant growth opportunity for our <unk> franchise, which we view as a durable core components of jazz as long term value that has multiple orange book listed patents.

Through 2033.

We continue to expect that a majority of oxalate patients across all approved indications, we will benefit from XI wave in 2023.

[noise] accounts for branded and generic higher sodium oxalate therapies entering the market.

The total diagnosed IH patient population is likely close to that of the diagnosed narcolepsy market, which is approximately 70,000-80,000 patients. As a reminder, beginning with our fourth quarter in 2021 year-end reporting, we will share the breakdown of the number of Zywave patients based on their diagnosis of either narcolepsy or IA.

With respect to the entry of authorized generic Xyrem, we plan to provide guidance for 2022 as usual on our fourth quarter earnings call at that time, we anticipate providing more information on the xyrem authorized generic launch.

The integration of GW continues to move ahead and as I noted in the past there is a superb cultural fit between the jazz and GW teams. The acquisition has proven to be highly complementary to our existing commercial portfolio and added the exciting GW cannabinoid platform and science to our R&D.

So moving to Epidiolex, this is our first full quarter with the product since the close of the GW acquisition. Epidiolex net product sales were 160.4 million, and we achieved a 21% increase over the same quarter in 2020 despite the ongoing impact of COVID-19. COVID-19 continues to put short-term pressure on epidiolic growth. There are several factors related to the pandemic that are at play. On a macro level, pediatric new prescriptions have been disproportionately impacted.

<unk>.

That said, we acknowledge there is work to be done while we have continued to grow up of dialects in the U S. There have been challenges in the face of the COVID-19 pandemic, Dan will provide more detail about how our commercial team is addressing these challenges to support further up the dialects growth in the U S.

As the chart on slide 8 illustrates, COVID-19 has been impacted by COVID relative to other specialties over the last 12 months. Epidiolic growth has been affected by this trend. Reports from the field indicate that due to COVID-19 and the lack of access to vaccines, especially for children under 12 years of age, many parents are hesitant to bring their children into an office setting and risk COVID exposure or change anti-epilepsy treatment regimens and risk breakthrough symptoms.

We continue to strengthen the durability of epic dialects and now have 20 Orange book listed patents with a majority extending through 2035.

We're also generating additional IP, including a composition of matter like patent that we expect will be issued later this year and listed in the Orange book in the first quarter of 2022.

This patent would expire in 2039.

And I want to be very clear, we remain excited by the potential long term value creation that the GW acquisition can deliver and our confidence in epidiorite has blockbuster potential and its importance as a component of our commercial portfolio has only increased since we brought it in house.

These dynamics have negatively impacted new patients.

Unconnected New Patient Starts, the majority of which are pediatric patients

At the same time, promotional visits to institutional centers in the U.S.

Turning to oncology <unk> Zilkha team is executing a top tier commercial launch. We are also advancing a robust clinical development plan and Rob will provide more color on our R&D efforts for us up soccer and across our portfolio later in the call.

Operational centers in the U.S. are down across the industry, and we see this playing out with Epidiolex. Through the first three quarters of 2021, relative to 2019, our average number of total monthly sales interactions with healthcare providers was down 44% overall, with face-to-face interactions down 71%. This has a notable negative impact on the growth rate of a newer product like Epidiolex, where education and in-office support for physicians with little or no product experience help expand trial usage and adoption.

On June 30, we were pleased to announce approval of Rai lays under Fda's real time oncology review, while we're early in the launch we believe that Riley's will become the standard of care for patients who need a non E coli derived asparaginase.

With respect to our financial performance, our third quarter delivered a 39% increase in total revenues compared to the same quarter last year.

We continue to diversify our revenue with more than 50% of net product sales coming from products launched or acquired since 2019 in Stark contrast to a year ago. When the same metric was just 8%.

And the impact here is not limited to epidiolex. Sales across other anti-epileptic drugs with similar indications to epidiolex have been flat in recent quarters. Now turning to slide nine, while there are challenges, our team has made steady progress in driving adoption in our three current indications: Dravet syndrome, Lennox-Gastaut syndrome, and tuberous sclerosis complex, or TSC.

These newer products are not only innovative medicines that address critical needs for patients with neurologic disorders and cancer. They're also durable long lived therapies that support our strategy of building a diversified high growth commercial portfolio our.

Our strong cash flow and disciplined capital allocation is enabling us to invest in the growth of our business, while staying on track to meet our deleveraging goal.

We continue to have high persistency rates among patients who begin therapy, and we see opportunity for additional patient growth across these indications. There has been strong adoption of epidiolics in large epilepsy centers, and we have increased our reach now to smaller centers and general neurology practices. As we expect COVID-19 pressures to ease in the U.S. and now with younger children becoming eligible to receive COVID vaccines, we expect to see an upturn in both patients visiting their health care providers to discuss new treatment options and our ability to provide in-person education to physicians.

With a strong foundation exciting new opportunities and continued execution against our plan I remain highly confident in <unk> future.

I'll now turn the call over to Dan for an overview of our commercial performance after which Rob will share an update on progress across our R&D programs.

They will provide a financial overview and then we'll open the call to Q&A Dan over to you.

Thanks, Bruce well I'm excited to share the progress across our commercial portfolio.

Starting with neuroscience, we saw strong momentum during the third quarter for Oxy based franchise.

The combination of which we believe will contribute significantly to Epidiolex growth. Based on positive trends and new and unique prescribers, as well as feedback from our prescribers, we are confident that we will continue to grow the Epidiolex prescriber base. So in response to the current environment, we implemented a number of virtual educational initiatives for healthcare providers and patients to further their understanding of Epidiolex's unique product profile and mechanism of action in the anti-epileptic drug class.

Average active oxygen patients increased to approximately 16000 in the quarter, a 6% increase over the same period last year and we exited the quarter with approximately 6000 active xyrem patients up from approximately 5100 at the end of the second quarter.

We see significant opportunity for XI ways to continue to grow in narcolepsy and remain focused on educating physicians and patients about the lifelong burden of high sodium intake.

Clearly in a patient population like this one with an increased risk of cardiovascular comorbidities.

In addition to the strong adoption of XI away from existing Xyrem patients. We continue to see the large majority of oxalate naive patients being prescribed xyrem ways as opposed to Xyrem.

In recent market research among prescribers, approximately 40% of respondents indicated they are moving epidiolex up in their treatment algorithm. We believe this is underpinned by more prescribers having experience with Epidiolex over time and gaining confidence in the product. There is also a very large unmet need for refractory epilepsies. In the U.S. alone, there are approximately 160,000 treatment-resistant pediatric epilepsy patients and approximately 1 million treatment-resistant epilepsy patients overall. Many of these patients have rare pediatric-onset epilepsy syndromes for which no FDA-approved treatment exists.

As slide seven illustrates we've achieved market, leading adoption for XI wave and narcolepsy relative to launches of other next generation neuroscience products. This speaks to the strong product profile, which includes FDA has published findings of the clinical superiority of XI waves to Xyrem based on greater safety because of reduced sodium.

As well as our deep understanding of the sleep space and our ability to successfully drive adoption of new therapies.

And we believe the IH indication will drive further growth evaluate our commercial launch began on November one and I'll remind listeners that a replay of our October webcast discussing the commercial launch strategy of XI wait for IH is available on our corporate website for those who missed it.

Specific to that particular syndrome

Epidiolex has the potential to treat a broad range of seizure types, and the goal of our development program is to add to that existing body of evidence. Our planned Registrational Trial in Epilepsy with Myoclonic Atonic Seizures, or EMOS, will provide data in this seizure type. In addition, we continue to invest in company-sponsored trials and to support investigator-initiated studies to evaluate the efficacy and safety of epidiolex in different epilepsy subtypes and across different endpoints. We also see a significant opportunity for Epidiolics growth coming from markets outside the U.S.

As we rollout this launch our initial focus is on driving awareness and adoption among existing auction based prescribers and the approximately 37000 people who have been diagnosed with IHS and are actively seeking health care.

Expanding the market beyond diagnosed <unk> patients who are actively seeking treatment provides us with a longer term growth opportunity and we estimate that the total diagnosed <unk> patient population is likely close to that of the diagnosed narcolepsy market, which is approximately 70 to 80000 patients.

So as a reminder, beginning with our fourth quarter and 2021 year end reporting we will share the breakdown of the number of <unk> patients based on their diagnosis of either narcolepsy or I H.

So moving type of dialysis. This is our first full quarter with the products since the close of the GW acquisition Epidiorite net product sales were $164 million.

Looking at slide 10, we have been extremely pleased with our progress in Europe. We have secured favorable pricing and access to date, and national reimbursement is in place in four of the five largest European markets, including Germany, the UK, Italy, and Spain. In those four markets, pricing is greater than 70% of the U.S. wholesale acquisition price.

And we achieved a 21% increase over the same quarter in 2020, despite the ongoing impact of COVID-19 Covid.

COVID-19 continues to put short term pressure on Epidiorite growth. There are several factors related to the pandemic. There are at play on a macro level pediatric new prescriptions have been disproportionately impacted by COVID-19 relative to other specialties over the last 12 months as the chart on.

In addition, we anticipate commercial launch in France next year. Overall, we remain excited about the future growth potential of Epidiolex. While we are currently navigating short-term headwinds, we are confident that with Epidiolex's unique mechanism of action, its ability to be combined with other therapies, and increasing positive experiences in real-world settings, it can become a standard of care for treatment-resistant epilepsy.

Slide eight illustrates.

<unk> growth has been affected by this trend.

Reports from the field indicate that due to COVID-19, and the lack of access to vaccines, especially for children under 12 years of age. Many parents are hesitant to bring their children into an office setting and risk COVID-19 exposure or change the anti epilepsy treatment regimens and risk breakthrough seizures. These.

These dynamics have negatively impacted new patient starts the majority of which are pediatric patients.

At the same time promotional visits institutional centers in the U S are down across the industry.

We see this playing out without the dialogues through the first three quarters of 2021 relative to 2019, our average number of total monthly sales interactions with health care providers were down 44% overall with face to face interactions down 71%.

So now turning to oncology and Xevzolca, our team has done an outstanding job on the launch of this innovative therapy. As a graph on slide 11 shows, net sales of Xevzolca substantially outperformed the launches of other comparable oncology products. Our team has done an outstanding job. We continue to see strong growth in demand for Zevzelka in the third quarter with net product sales of $71.7 million. As noted in our press release, we have lowered our return provision to reflect actual experience. This had the effect of increasing the quarter's net sales number by approximately $10 million. Excluding this adjustment, third quarter net product sales increased approximately 10% compared to the second quarter.

This has a notable negative impact on the growth rate of the newer products like that the dialogues where education and in office support for physicians with little or no product experience help expand trial usage and adoption.

And the impact here is not limited to at the dialogues are safe.

All of the Cros and other anti epileptic drugs with similar indications that the dialogues have been flat in recent quarters.

Now turning to slide nine while there are challenges our team has made steady progress in driving adoption in our three current and indications are they syndrome, Lennox <unk> syndrome, and tuberous sclerosis complex or TFC.

As you can see in the chart on slide 12, Zepzelka is now the treatment of choice in second-line small cell lung cancer, and we're pleased that its share in this setting continues to increase, taking market share from Topatican and immuno-oncology products used as monotherapies. We continue to see near-term growth opportunities, as we expect Zep Celka will continue to gain share among patients being re-challenged with platinum-based chemotherapies or receiving other chemotherapy regimens. Now moving to Rylase, our internally developed recombinant Erwinia asparaginase therapy launched in mid-July. Third quarter net product sales were $20.7 million.

We continue to have high persistency rates among patients who begin therapy, and we see opportunity for additional patient growth across these indications.

There has been strong adoption the methodologies and large epilepsy centers and we have increased our reach now to smaller centers in general neurology practices.

As we expect COVID-19 pressures to ease in the U S and now with younger children, becoming eligible to receive Covid vaccines, we expect to see an upturn in both patients visiting their health care providers to discuss new treatment options and our ability to provide in person education to physicians.

The combination of which we believe will contribute significantly to the dialects growth.

Based on positive trends in new and unique prescribers as well as feedback from our prescribers. We are confident that we will continue to grow the epidiorite prescriber base.

Initial feedback from accounts is encouraging, and we have received positive reports on the ease of both ordering and dose preparation, as well as our support services. In terms of market dynamics, Erwin Ace was still available in the supply channel through mid-September, which included the last imported batch of Erwin Ace sold by Clinogen that FDA allowed the importation of in May. We believe the overwhelming majority of Erwin H. Supply was used up by the end of August and there was a notable uptick in Riley's orders beginning in September.

So in response to the crowded environment, we've implemented a number of virtual educational initiatives for health care providers and patients to further their understanding of Epidiorite Suez unique product profile and mechanism of action and the anti epileptic drug class and recent market research among prescribers approximately 40% of risk.

<unk> indicated they are moving at the dialects up in their treatment algorithm.

We believe this is underpinned by more prescribers, having experienced without the dialects overtime and gaining confidence in the product.

There is also a very large unmet need in refractory epilepsies and the U S alone. There are approximately 160000 treatment resistant pediatric epilepsy patients and approximately $1 million treatment resistant epilepsy patients overall.

To support the launch, we're executing numerous commercialization activities to educate healthcare professionals about the clinical profile and the administration of Rylase, and we're working to place Rylase on institutional formularies and into their regular ordering system.

Many of these patients have rare pediatric onset epilepsy syndrome for which no FDA approved treatment exists specific to that particular syndrome.

In summary, having delivered on the ZyWave for Narcolepsy and ZepZelka launches, we are confident in our commercialization team's ability to achieve successful launches for Rylase and ZyWave in IH. And while we've been facing some near-term headwinds from COVID for Epidiolex, we do expect to be able to drive growth for this brand and across our product portfolio in future quarters and to deliver meaningful value as we transform the lives of patients and their families. I'm now going to turn the call over to Rob for an update on our development programs. Thank you, Dan.

<unk> has the potential to treat a broad range of seizure types and the goal of our development program is to add to that existing body of evidence.

Our planned Registrational trial in epilepsy, with Myoclonic, atonic seizures or E. Moss will provide data in the seizure type.

In addition, we continue to invest in company sponsored trials and to support investigator initiated studies to evaluate the efficacy and safety of F. The dialogues and different epilepsy subtypes and across different endpoints.

We also see a significant opportunity for epidemics growth coming from markets outside the U S. Looking at slide 10, we have been extremely pleased with our progress in Europe, we have secured favorable pricing and access to date and national reimbursement is in place in four of the five largest European markets include.

On slide 15, we've detailed key clinical programs in our pipeline. Starting with our neuroscience development programs, the integration between our jazz and GW R&D teams is progressing really well. We are advancing multiple therapies across our neuroscience portfolio, including a number of programs emerging from the GW cannabinoid platform. Epidiolex is currently approved to treat seizures associated with three refractory epilepsy disorders, and we remain on track to initiate a registrational phase three trial for a fourth indication, Epilepsy with Myoclonic Atonic Seizures, or EMAS, in the first half of 2022. He must be characterized by a generalized myoclonic atonic seizure.

In Germany, the UK, Italy, and Spain, and those four markets pricing is greater than 70% of the U S. Wholesale acquisition price. In addition, we anticipate commercial launch in France next year.

Overall, we remain excited about the future growth potential of that the dialogues. While we are currently navigating short term headwinds we are confident that wood epidiorite Suez unique mechanism of action its ability to be combined with other therapies and increasing positive experiences in real world settings.

<unk> can become the standard of care for treatment resistant epilepsy.

So now turning to oncology and Zilkha our team has done an outstanding job on the launch of this innovative therapy as the graph on slide 11 shows net sales of <unk> substantially outperformed the launches of other comparable oncology products.

Our team has done an outstanding AR.

And this trial will provide the first randomized, controlled clinical data with Epidiolex in the seizure, which we believe will provide further data on the potential effectiveness of Epidiolex in treating a broad range of future disorders. Now, turning to Naviximals. The program has three active clinical trials focused on multiple sclerosis-related spasticity. We expect data from the first trial, which is a smaller, shorter trial relative to the other two, in the first half of 2022.

Sorry, we continue to see strong growth in demand for <unk> <unk> third quarter with net product sales of $71 7 million as noted in our press release, we have lowered our return provisions reflect actual experience.

This had the effect of increasing the quarter's net sales number by approximately $10 million. Excluding this adjustment third quarter net product sales increased approximately 10% compared to the second quarter.

As you can see on the chart on slide 12, the Zilkha has now the treatment of choice in second line small cell lung cancer and we're pleased that <unk> share in this setting continues to increase taking market share from <unk> and immuno oncology products used as monotherapy.

If results from this first trial are positive, there is the potential for a regulatory submission in the U.S. in the next 18 to 24 months, and we expect data from the two additional trials, which have larger sample sizes, to read out in late 2022 and early 2023. Now to discuss JZP385, we recently initiated our Phase 2 clinical trial for JZP385 and essential tremor, and we expect data to read out in the first half of 2024.

We continue to see near term growth opportunities as we expect <unk> will continue to gain share among patients being re challenged with platinum based chemotherapy or receiving other chemotherapy regimens.

Now moving to <unk> on slide 13, our internally developed a recombinant erwinia asparaginase therapy launched in mid July 3rd quarter net product sales were $20 7 million initial feedback from accounts is encouraging and we have received positive reports on the ease of both ordering and dose prep.

In the U.S., and Top 5 European Markets, it is estimated that there are approximately 2 million people diagnosed with essential tremor, with about a half a million being drug-treated. We are also on track to initiate our Phase 2 trial for JZP15, Fatty Acid Amide Hydrolysis.

<unk> as well as our support services.

In terms of the market dynamics are <unk> still available in the supply channel through mid September which included the last imported batch of Irwin a sold by Clinton adjourn that FDA allowed the importation of in May.

Fall inhibitor in Post-Traumatic Stress Disorder by the end of this year. Now moving to oncology, I'd like to start with Ziffelka and update our development plans for small cell lung cancer and other potential indications, which include four clinical trials that are underway or will be initiated in early 2022. In collaboration with our partner Roche, we are supporting a phase three trial to evaluate first-line use of Dibzelka in combination with Tizolizumab or Ticentric as maintenance therapy in patients with extensive stage small cell lung cancer after completion of induction chemotherapy.

We believe the overwhelming majority of Irwin a supply was used up by the end of August and there was a notable uptick in Rye latest orders beginning in September.

To support the launch we're executing numerous commercialization activities to educate healthcare professionals about the clinical profile and the administration of <unk> and we're working to place relates on institutional formularies and into their regular ordering systems.

In summary, having delivered on the XI wave for narcolepsy and <unk> launches, we are confident in our commercialization teams ability to achieve successful launches for <unk> and XI with NIH.

Well, we have been facing some near term headwinds from Covid for Epidiorite, we do expect to be able to drive growth for this brand and across our product portfolio in future quarters and to deliver meaningful value as we transform the lives of patients and their families.

This trial has already been initiated and is now listed on clinicaltrials.gov, and we anticipate the first patient will be enrolled later this year. Other trials include a confirmatory trial on second-line small cell lung cancer being run by our partner PharmaMar that is expected to start later this year. A phase II BASCA trial to explore efficacy and safety of lumenectin monotherapy in patients with select advanced and metastatic solid tumors that we expect to initiate in early 2022, as well as a phase four observational study in small cell lung cancer that is underway.

I'm now going to turn the call over to Rob for an update on our development programs Rob.

Thank you Dan.

On slide 15, we've detailed key clinical programs in our pipeline.

Starting with our neuroscience development programs the integration between our jazz and GW R&D teams is progressing really well we.

We are advancing multiple therapies across our neuroscience portfolio, including a number of programs emerging from the GW cannabinoid platform.

Urban dialects as currently approved to treat seizures associated with three refractory epilepsy disorders, and we remain on track to initiate a registrational phase III trial for a fourth indication.

Let's see with Myoclonic, atonic seizures or email us and the first half of 2022.

Now, I'd like to point out that we expect the Phase 4 study to provide additional data regarding the efficacy of Zipf-Zelka in certain populations, including those patients considered to be platinum sensitive who were often retreated with platinum-based chemotherapy in the second line. I would like to highlight that these patients did particularly well with the cell, as seen in the cohort of patients that supported accelerated approval. Further evidence of improved outcomes across a large number of platinum-sensitive patients, such as from the phase four observational study, would provide even stronger rationale for expanding the use of Zitzelka in this key second line setting. Platinum retreatment is the second most used therapy behind Zilker.

<unk> is characterized by generalized myoclonic atonic seizures and this trial will provide the first randomized controlled clinical data with <unk> and the seizure types, which we believe will provide further data on the potential effectiveness of epidiorite and treating.

A broad range of seizure disorders.

Now turning to <unk>.

The program has three.

<unk> clinical trials focused on multiple sclerosis related specificity.

We expect data from the first trial.

Which is a smaller shorter trial relative to the other two in the first half of 2022.

If the results from this first trial are positive there is the potential for a regulatory submission in the U S. In the next 18 to 24 months.

Moving to RILASE, we received FDA approval in June prior to the completion of our clinical trial through the real-time oncology review process, which allowed us to prioritize making this therapy available to patients. We took RILAs from first in human trials to approval in just two and a half years, and we have that same urgency as we advance the development program. We are very pleased to receive real-time oncology review status yet again this time to submit an SPLA to update our label to intramuscular Monday, Wednesday, Friday till schedule that is more in line with current clinical practice, and this is a high priority for the program. We expect to complete the SBLA submission in early 2020. The ongoing trial is also assessing the intravenous administration of Rite, which is common for asparaginase in Europe and other geographies.

And we expect data from the two additional trials, which have larger sample sizes to readout in late 2022 early 2023.

Yes.

Now to discuss GBP three five we recently recently initiated.

Our phase III clinical trial for JCB create five and essential tremor.

And expect data to read out in the first half of 2024.

In the U S.

Top five European markets. It's estimated that there are approximately 2 million people diagnosed with essential tremor.

It's about a half a million paying drug treated.

We are also on track to initiate our phase II trial for <unk>, one five a.

Fatty acid amide hydrolase or saw inhibitor and post traumatic stress disorder.

End of this year.

Now moving to oncology I'd like to start with the Saka and update our development plans in small cell lung cancer and other potential indications, which includes four clinical trials that are underway or will be initiated in early 2022.

We anticipate the data from our current development program will support regulatory submissions in Europe, and we are moving rapidly to submit in mid-2022 for both the IM and IV routes of administration with potential approvals in Europe beginning in 2022. We are presenting data from the Riley trial at the upcoming American Society of Hematology annual meeting in December, including findings from the important 25, 25, 50 milligram IM dosing regimen from 52 patients.

In collaboration with our partner Roche, we are supporting a phase III trial to evaluate first line use of <unk>.

In combination with a piece of wisdom, app centric compared to centric alone as maintenance therapy in patients with extensive stage small cell lung cancer after completion of induction chemotherapy.

This trial has already been initiated and is now listed on clinical trials Gov, and we anticipate the first patient will be enrolled later this year.

Right.

Other trials include a confirmatory trial in second line small cell lung cancer being run by our partner farmer and is expected to initiate later this year.

I'd like to wrap up by highlighting that we have significantly advanced our combined R&D capabilities and productivity, and we have an incredibly talented team. As I've outlined here today, multiple late-stage trials and registrational trials are ongoing or expected to begin soon. And as we enter 2022, we look forward to sharing updates on our earlier stage development programs and research initiatives. I'll now turn the call over to Rene. Thanks, Rob.

Page two basket trial to explore efficacy and safety of <unk> monotherapy in patients with selected advanced and metastatic solid tumors that we expect to initiate in early 2022.

As well as a phase four observational study in small cell lung cancer that is underway.

Now I'd like to point out that we expect the phase four study to provide additional data regarding the efficacy of themselves in certain populations, including those patients considered to be platinum sensitive or.

Often retreated with platinum based chemotherapy in the second line.

Full financial results are available in our press release and 10-Q, and several key metrics are highlighted on slides 17 and 18. On today's call, I'll discuss our overall financial performance and provide additional color around our updated guidance. We have made significant strides in transforming our business through the first three quarters of 2021, and we're well positioned to finish the year with positive momentum into 2022.

I'd like to highlight that these patients did particularly well with itself.

As seen in the cohort of patients that supported accelerated approval.

Further evidence of improved outcomes across a large number of platinum sensitive patients.

That's just from the phase for observational study.

To provide even stronger rationale for expanding the use of themselves.

In this key second line setting.

As platinum retreat and it is the second most used therapy behind itself.

Moving to <unk>, we received FDA approval June prior to the completion of our clinical trial through the real time oncology review process, which allowed us to prioritize making this therapy available to patients.

We remain on track for substantial annual revenue growth this year and, for the first time, expect to exceed $3 billion in annual revenue. This growth was demonstrated in our third quarter revenue results of $838 million, which represented a 39% growth over the same period last year. Our strong performance is underpinned by commercial execution, financial discipline, and strategic allocation of capital, as well as prioritization of commercial and R&D opportunities that have the most impact on our future growth.

We took wireless from first in human trials to approval in just two and a half years.

And we have that same urgency as we advance the development program.

We are very pleased to receive real time oncology review status yet again this time to submit an S. BLA to update our label to intramuscular Monday Wednesday Friday dosing schedule.

A schedule that is more in line with current clinical practice and this is a high priority for the program.

We expect to complete the SPL a submission in early 2022.

Launching multiple products over the past two years, coupled with the acquisition of GW Pharmaceuticals, has enabled us to significantly advance our objective of diversifying revenue. 52% of net product sales in the third quarter were generated from products which we have launched or acquired since 2019.

The only the only trials also assessing intravenous administration of royalties, which is common for asparaginase in Europe and other geographies.

We anticipate the data from our current development program will support regulatory submissions in Europe, and we are moving rapidly to submit in mid 2022 for both the I am.

Given our expectations regarding the durability and growth potential of these products, we remain confident in reaching our goal of at least 65 percent of net product sales coming from these newer products in 2022. Focusing specifically on the GW acquisition, we are demonstrating our ability to execute on the corporate development front. We successfully closed this transformative transaction in approximately 90 days post-signing, issuing over $5 billion of new debt with attractive and flexible terms to support the deal.

And IV routes of administration with potential approvals in Europe, beginning in 2023.

We are presenting data from the <unk> trial at the upcoming American Society of Hematology annual meeting in December including findings from the important $25 25 50 milligram.

And dosing regimen.

52 patients.

I'd like to wrap up by highlighting that we have significantly advanced our combined R&D capabilities and productivity and.

And we have an incredibly talented team in place.

As I've outlined here today multiple late stage trials in Registrational trials are ongoing or expected to begin soon.

And as we entered 2022, we look forward to sharing updates.

Earlier stage development programs and research initiatives.

The broad commercial and R&D portfolio we gained in the GW acquisition has accelerated our transformation not only in terms of revenue diversification and R&D expansion but also increased expectations for future top and bottom line growth. As Bruce mentioned earlier, we're very pleased with the progress of the GW integration.

I'll now turn the call over to Rene.

Thanks, Rob.

Full financial results are available in our press release, and 10-Q and several key metrics are highlighted on slides 17 and 18.

On today's call I'll discuss our overall financial performance and provide additional color around our updated guidance.

We have made significant strides in transforming our business through the first three quarters of 2021.

In bringing our companies together, not only have we enhanced our capabilities, expanded our footprint, and retained key talent across both organizations, but we are locking in our synergy targets and optimizing the way we operate and invest through transformation initiatives that are driving greater effectiveness and focus on our most important priorities. Since closing the transaction, our strong cash generation, driven by our continued financial and operational performance, has enabled us to achieve a 4.4 times net leverage ratio at the end of the third quarter. This represents a half-turn decrease in net leverage in just five months following the close of the transaction.

And we're well positioned to finish the year with positive momentum entering 2022.

We remain on track for substantial annual revenue growth this year and for the first time expect to exceed $3 billion in annual revenue.

This growth was demonstrated in our third quarter revenue results of $838 million, which represented a 39% growth over the same period last year.

Our strong performance is underpinned by commercial execution financial discipline, and strategic allocation of capital as well as prioritization of commercial and R&D opportunities that have the most impact on our future growth.

Launching multiple products over the past two years, coupled with the acquisition of GW Pharmaceuticals has enabled us to significantly advance our objective of diversifying revenue.

Importantly, we are on track to achieve our stated net leverage target of being below three and a half times by the end of 2022. In addition to reducing debt, we are also investing in our business to drive future growth and durability. This includes focused investments in the ongoing commercial launches of Xywave, Satselka, and Rylase, realizing the blockbuster potential of Epidiolex, and advancing our R&D pipeline and the GW cannabinoid platform. As our newly launched commercial portfolio matures and our business scales, we expect to realize further operating leverage and associated improvements in our underlying operating margins.

52% of net product sales in the third quarter were generated from products, which we have launched or acquired since 2019 give.

Given our expectations regarding the durability and growth potential of these products, we remain confident in reaching our goal of at least 65% of net product sales coming from these newer products in 2022.

Focusing specifically on the GW acquisition, we are demonstrating our ability to execute on the corporate development front. We successfully closed this transformative transaction and approximately 90 days post signing issuing over $5 billion of new debt with attractive and flexible terms to <unk>.

Now turning to guidance, we are raising our full-year earnings guidance for non-GAAP Adjusted Net Income, or ANI, to a range of $925 to $965 million, up from our prior range of $830 to $910 million. Our updated non-GAAP ANI range exceeds the upper end of the prior range on both an absolute and a per share basis, which reflects both our financial discipline and strategic capital allocation. On the top line, we are narrowing our total revenue guidance range to $3.02 to $3.1 billion from $3.02 to $3.18 billion.

Support the deal.

The broad commercial and R&D portfolio, we gained in the GW acquisition has accelerated our transformation not only in terms of revenue diversification in R&D expansion, but also increased expectations for future top and bottom line growth.

As Bruce mentioned earlier, we're very pleased with the progress of the of the Tw integration and bringing our companies together not only have we enhanced our capabilities expanded our footprint and retain key talent across both organizations, but we are locking in our synergy targets and optum.

Reducing the midpoint of total revenue guidance reflects our updated oncology revenue expectations, which we have narrowed to $715 to $735 million from $715 to $835 million. Our current oncology guidance reflects ongoing impacts of COVID on our legacy products and the Riley's competitive landscape in the third quarter. We have also narrowed our neuroscience revenue guidance to between $2.275 and $2.345 billion while keeping the same midpoint as our previous guidance. On the expense side, we have reduced our total OPEX guidance by approximately $115 million at the midpoint, primarily to reflect the following three factors.

I think the way, we operate and invest through transformation initiatives that are driving greater effectiveness and focus on our most important priorities.

Since closing the transaction our strong cash generation driven by our continued financial and operational performance has enabled us to achieve a 4.4 times net leverage ratio at the end of the third quarter.

This represents a half turn decrease and net leverage and just five months following the close of the transaction.

Importantly, we're on track to achieve our stated leverage target of being below three and a half times by the end of 2022.

One, a thoughtful approach to integrating the Jazz and GW operations. Two, prioritization of R&D activities to invest in those opportunities that we believe will deliver maximum value. And three, the extended duration of COVID-19, which pushed out a portion of our planned commercial spend for in-person interactions.

In addition to reducing debt. We are also investing in our business to drive future growth and durability. This includes focused investments and the ongoing commercial launches of <unk> silica and reilly's, realizing the blockbuster potential about the dialects and advancing our R&D pipeline and the <unk>.

I'll also note that included in our implied fourth-quarter OPEX guidance is the launch of ZyWave and IH and three important clinical trial initiations with JZP385, JZP150, and Zepselka. The integration of Jazz and GW has been a catalyst for transforming our business. We are becoming a highly efficient and effective organization, poised to emerge as a nimble enterprise with the ability to scale rapidly as we continue to increase our revenue diversification and growth.

Cannabinoid platform as our newly launched commercial portfolio matures and our business scales, we expect to realize further operating leverage and associated improvements in our underlying operating margins.

Now turning to guidance, we are raising our full year earnings guidance for non-GAAP, adjusted net income or an eye to a range of $925 million to $965 million up from our prior range of $830 million to $910 million.

Our commercial portfolio now consists of multiple high-growth, long-lived medicines, which is complemented by an augmented R&D organization that is advancing multiple mid- and late-stage programs and a corporate development strategy with a track record of valuable contributions to our commercial and development efforts. We will continue to prioritize commercial R&D and business development efforts that drive value and growth, leveraging our strong cash generation to invest in our business, improve our bottom line, and continue to deliver strong shareholder returns. I'd now like to turn the call back to Bruce. Thanks, Rene.

Our updated non-GAAP, an eye range exceeds the upper end of the prior range on both an absolute and per share basis, which reflects both our financial discipline and strategic capital allocation.

On the top line, we are narrowing our total revenue guidance range to three point O two to $3 $1 billion from three point out $2 billion to $3.18 billion, reducing the midpoint of total revenue guidance reflects our updated oncology revenue.

<unk>, which we have narrowed to $715 million to $735 million from $715 million to $835 million.

I'll conclude our prepared remarks on slide 19. Building on our current momentum, we expect to finish 2021 on a strong footing, which will position us well going into 2022. With FDA approval of Zywave for IH, we achieved our goal of five product launches. Our commercial teams demonstrated strong performance on the launches of Zywave for Narcolepsy and Zepzelka, and we expect that successful execution will carry forward to the launches of Rylase and Zywave for IA.

Our current oncology guidance reflects ongoing impacts of Covid on our legacy products and the <unk> competitive landscape in the third quarter.

We have also narrowed our neuroscience revenue guidance to 2.2 75 to 2.3 $45 billion, while keeping the same midpoint as our previous guidance.

On the expense side, we have reduced our total opex guidance by approximately $115 million at the midpoint primarily to reflect the following three factors one a thoughtful approach to integrating the jazz and GW operations to prioritization of R&D activities to IND.

The GW team orchestrated an excellent launch for Epidiolex, and its addition to our commercial portfolio provides us with the opportunity to deliver an important therapy to patients with refractory epilepsy. Our R&D organization continues to evolve and expand its capabilities. Trials for nabixamals, JCP385, Rilase, and Zepzelka are now underway, and we are planning to initiate multiple mid and late stage clinical trials in the next 12 months

And those opportunities that we believe will deliver maximum value and three the extended duration of COVID-19, which pushed out a portion of our planned commercial spend for in person interactions.

I'll also note that included in our implied fourth quarter Opex guidance is the launch of Sideway, the NIH and three important clinical trial initiations with <unk> 385, Gen Z P. One side, though ends up soccer.

Our disciplined capital allocation has enabled us to expand our pipeline and diversify our revenue, and we are in a position to invest in those assets and opportunities that hold the highest potential to drive sustainable long-term growth and shareholder value. We have the ability to generate strong cash flow that allows us to make appropriate investments in our business while also achieving our deleveraging target. That concludes our prepared remarks, and I'd now like to turn the call over to the operator to open the line for Q&A.

The integration of jazz and GW has been a catalyst for transforming our business, we are becoming a highly efficient and effective organization poised to emerge as a nimble enterprises with the ability to scale rapidly as we continue to increase our revenue diversification and growth.

Our commercial portfolio now consists of multiple high growth long lived medicines, which is complemented by an amplified R&D organization that is advancing multiple mid and late stage programs and a corporate development strategy with a track record a valuable contribution to.

Ladies and gentlemen, if you have a question at this time, please press star then the number one key on your telephone. If your question has been answered or you wish to remove yourself from the queue, please press the pound key. As a reminder, please limit yourself to one question each. Thank you. Your first question comes from the line of Mark Goodman from SVP Lyrinc. Your line is open.

Our commercial and development efforts, we will continue to prioritize commercial R&D and business development efforts that drive value and growth leveraging our strong cash generation to invest in our business.

Yes, hi, Rob. I heard that there are some R&D activities that have kind of gone away. That's what Rene said. Can you talk about some of the programs that have stopped? I'm just kind of curious.

Improve our bottom line and continue to deliver strong shareholder returns.

I'd now like to turn the call back to Bruce.

Thanks, Renee <unk>.

I'll conclude our prepared remarks on slide 19 Bill.

Building on our current momentum we expect to finish 2021 on strong footing, which will position us well going into 2022.

There was GW had an autism program. They had a product for schizophrenia. They had a next-generation epiidiolex that they showed some early data on before the merger. Just curious, have those all been stopped, or just give us a sense of that? And then, if you guys could just give us a little more color on Riley's and how to think about what's backlogged versus what's real demand and whether we should expect a massive step up this quarter. Thank you.

With FDA approval of <unk> for IH, we achieved our goal of five product launches in two years. Our commercial teams have demonstrated strong performance on the launches of <unk> for narcolepsy ends up soccer and we expect that successful execution will carry forward to the launches of Reillys and XI wafer out.

H.

The GW team orchestrated an excellent launch rapid dialects and its addition to our commercial portfolio provides us with the opportunity to deliver an important therapy to patients with refractory epilepsies.

Rene, I'm not sure if you want to comment on what you were specifically referring to, but the way I would answer that question is, in coming together with GW, we really had the opportunity to continue to invest in the highest value opportunities. And, of course, we've prioritized certain things, as we've described on this call tonight. There were many, many smaller studies that may have been investigated or initiated or we've supported along the way, either on the GW or Jazz side, that may not ultimately progress in the pipeline. But I think, by and large, we've continued to invest heavily in all the key areas that we were investing in prior to legacy.

Our R&D organization continues to evolve and expand its capabilities.

<unk> <unk> hundred 85, Riley's ends up silica are now underway and we are planning to initiate multiple mid and late stage clinical trials in the next 12 months, our disciplined capital allocation has enabled us to expand our pipeline and diversify our revenues and we are in a position.

<unk> to invest in those assets and opportunities, but hold the highest potential to drive sustainable long term growth and shareholder value.

We have the ability to generate strong cash flow that allows us to make appropriate investments in our business, while also achieving our deleveraging targets.

Okay, I'll just add...

I was just going to add that this is also about, as we bring our organizations together, the how as much as the what. Certainly, we've seen a lot of complementary skill sets coming from both areas. So, in some cases, as we put together hiring plans and looked at the skill sets that we needed, we've seen these two groups come together and offer more versus what was originally anticipated. And that's not something that you'd have a really good idea of, Mark, until you get the groups together and really start integrating.

That concludes our prepared remarks, and I'd now like to turn the call over to the operator to open the line for Q&A.

Ladies and gentlemen, if you have a question at this time. Please press Star then the number one key on your telephone you for your question that's been answered or you wish to remove yourself from the queue. Please press the pound key.

As a reminder, please limit yourself to one question each thank you.

Your first question comes from the line of Marc Goodman from SVP Leerink. Your line is open.

Yes, Hi, Rob.

Heard that there's been.

Some R&D activities that have kind of gone away. That's what Rene said could you talk about some of the programs that have stopped or just kind of curious there was GW had an autism program. They had a product for schizophrenia. They had a next generation.

We've also seen examples, certainly, of certain programs that would be duplicative across both pipelines. That's a great problem to have as you look at where to invest your capital to ensure that you're putting your capital behind your highest-value activities. Kim, maybe I can ask you to jump in on Riley's question. Sure. So I'll start by saying that.

Epic dialects that they showed some early data on before the merger just curious have those all been stopped or just give us a sense of that and then if you guys could you just give us a little more color on an ROI, ladies and how to think about what's backlog versus what's.

Real demand and whether we should expect a massive step up this quarter. Thank you.

You know, we've laid a really strong foundation, and, you know, Riley's growth is continuing.

Yes.

I'm not sure if you want to comment on what you are specifically referring to is the way I would answer that question is and coming together with GW, we really had the opportunity to continue to invest in the highest value opportunities and of course we've.

We've gotten initial feedback from our accounts, and it's very encouraging.

We've received positive reports on the ease of both ordering and dose preparation as well as the JazzCare support services. What I can say about ordering is that when Riley's was made commercially available in mid-July, there was still Erwin A's on the market on hand in hospital pharmacies that they were looking to utilize before placing orders. The temporary importation of UK Erwin A's from June, we saw a run out of stock in September, and that's where we really saw a notable uptick in Riley's orders beginning in September from customers. So overall, we're very encouraged by

Prioritize certain things as we've described in this in this call Tonight there were many.

Many smaller studies that may have been investigator initiated we supported along the way either on the GW of genocide.

Not ultimately.

That's in the pipeline, but I think by and large we've continued to invest heavily in.

All the key areas.

That we were investing in prior legacy companies.

Yeah.

Ed.

Go ahead go ahead Renee.

I was just going to add that this is also about as we bring our organizations together the how that's not just the what certainly we've seen a lot of complementary.

So, overall, we're very encouraged by feedback from accounts, and we think we're in a strong place, you know, from an order standpoint.

<unk>, that's coming from both.

Areas. So in some cases as we put together our hiring plans and looked at the skill sets that we've needed. We've seen these two groups come together and offer more versus what was that originally anticipated and that's not something that you'd have a really good idea of mark until you get the grants to gathering really start integrating with.

Your next question comes from the line of Jason Garberry from Bank of America. Your line is open. Oh, hey, guys.

Oh, hey, guys. Thanks for taking my questions. So, my question is on ZyWave and thinking about the progression of the launch here. Do you think there are accelerants to the rate of quarterly additions that are moving on to ZyWave? And your latest thoughts on HICMA? I think last quarter you framed it as a possible risk of market entry in 2022. Just curious if that's still the case.

Also seen example, certainly in certain programs that would be duplicative across both pipelines. That's a great problem to have as you look at where to invest your capital to ensure that you're putting your capital behind your highest value activities.

Kim maybe I can ask you to jump in on the related question.

Sure Yes.

So I'll start by saying that we laid.

Later, a really strong foundation.

And you know Riley process.

<unk> accelerate we've gotten initial feedback from our accounts that's very encouraging we've received positive reports on the ease of both ordering and dose preparation as well as the calf care support services, what I can say about ordering is that when you know riley's with made commercially available in mid July there.

And ultimately, curious, Bruce, your comment about 4Q and providing an update there. I guess what materially changed in the contracts that could allow you to talk about HICMA timing in February versus not being able to talk about it today in November? And maybe I'll take the back half of your question first, Jason, and I can ask him to comment on Xiway progression. Um, you know, what will change in the fourth quarter earnings announcement is that we'll be doing that in the context of giving full guidance for 2022 across our business, including neuroscience and including Oxibate, and I think I can give you a better sense of how we expect the year to play out.

It was still early days on the market on hand and hospital pharmacies.

They were looking to utilize before placing orders.

Temporary importation of U K Irwin A's.

From June.

We saw a run out of stock in September and that's where we really saw a notable uptick in and relays orders beginning in September from customers. So overall, we're very encouraged by feedback from accounts and we think we're in a strong place from an order standpoint.

Operator.

Your next question comes from the line of Jason <unk>.

From Bank of America. Your line is open.

Oh, Hey, guys. Thanks for taking my questions.

So it's not a comment specifically on contractual terms. It's just, you know, providing a full explanation of our expectations for Oxibate. On the question of timing, nothing's changed since our disclosure of the last couple quarters, honestly, in terms of recognizing that although the contract says entry no later than January 1st, 2023, there is a market decline provision that we believe could be triggered in 2022. But that's not different from what we've said before.

Some eyes on XI wave and <unk>.

Thinking about the progression of the launch here do you think there are accelerants to the rate of quarterly additions that.

That are moving on to XI wave in your latest thoughts on Hikma I think last quarter, you framed it as a possible risk of market entry in 2022, just curious if that's still the case and ultimately curious Bruce your comment about <unk> and providing an update there I guess what materially changes in the contracts that could allow.

You did talk about Hikma timing in February versus not being able to talk about it today in November thanks.

<unk>.

Yeah, maybe I'll take the back half of your question for Jason and I can ask him to comment on <unk> progression.

On Xywave progression, I'll ask Kim to jump in. But, you know, we're really excited to have launched a product last week in a new indication. And so for the first time, in our fourth quarter 2021 results, we will have both narcolepsy and the beginnings of the IH launch. So that'll be a little bit of a change from just the trajectory we've seen thus far.

What will change in the fourth quarter earnings announcement is we will be doing that in the context of giving full guidance for 2022 across our business, including neuroscience and including Ox abate and I think he can give you a better sense of how we expect the year to play out so it's not a comment specifically on contractual terms.

Terms, it's just providing a full.

Explanation of our expert expectations for ox abate.

Kim?

Sure, great.

So, you know, as Dan shared, we're excited that Zywave has achieved market-leading adoption in narcolepsy and that we've, you know, continued to see some nice solid growth through the third quarter. You know, we've seen very strong adoption among high-volume oxidate prescribers and are now really increasing our focus on, you know, HCPs who have either not yet adopted Zywave or have not transitioned yet the majority of their narcolepsy patients among

On the question.

A question of timing nothing has changed since our disclosure of the last couple of quarters honestly in terms of recognizing that although the contract says entry no later than January one 2023, there is a market decline provision that we believe could be tripped in 2022.

But that's not different from what we've said before.

On on Zywiec progression I'll ask him to jump in but we're really excited to have launched our products.

Last week in a new indication and so for the first time.

Transition. Most of their patients were focusing on, you know, obsolete, naive patients.

In our fourth quarter 2021 results will of course have both narcolepsy and the beginnings of the IH launch so that'll be a little bit of a change of just the trajectory we've seen thus far Kim.

So we remain optimistic that HCPs will see the value in lower sodium oxibate as we see the majority of

And, you know, we're very pleased that the FDA recognized the importance of lower sodium options by granting ZiWave orphan drug exclusivity back in June and went on to state that, you know, the clinical superiority findings were that ZiWave is clinically superior to Xyrem by means of greater safety because Zyway provides a greatly reduced chronic sodium burden compared to Zyrum. And then, you know, the other driving factor, as Bruce just mentioned, of course, is that we launched Zyway for the treatment of IH last week, which is the first and only FDA-approved treatment for adults with idiopathic hypersomnia.

Sure Great. So yeah. It is Dan shared you know we're excited that <unk> has achieved in a market leading adoption in narcolepsy and that we've continued to see some nice solid growth through the third quarter.

Seen to date very strong adoption among high volume asset eight prescribers and are now really increasing our focus on HCP, who have either not yet adopted by wave or have not transitioned yet the majority of their narcolepsy patients are among those that have transitioned most of their patients we're focusing on.

Activate naive patients.

We anticipate that the adoption rate among these HCP and actually we've observed.

And it will be slower than.

Then we saw in the first three quarters, we do remain focused on educating these HCP and patient about the lifelong burden of high sodium intake.

And we really see this launch as a significant value driver, with approximately 37,000 adult patients out there who have been diagnosed with IH are actually out there actively seeking, you know, treatment for it in the healthcare system.

So we remain optimistic the HCP as we'll see the value in lower sodium acts debate.

We see the majority of acetate naive patients today being prescribed XI Wade.

So our commercial teams are working to educate right now about Zywafer IH, while also, very importantly,

Two to Xyrem.

And you know, we're very pleased that the FDA recognized the importance of.

Transitioning Narcolepsy Patients to Zywave Due to the Benefits of Lower Sodium Specifically, in IH, we're focused on executing a very targeted launch strategy that includes both robust disease education and branded efforts, and to support this strategy, we have a variety of digital and in-person efforts that are helping to demonstrate both that IH is a unique medical condition and the clinical benefits and safety profile of Zywave. So moving forward, we're going to be providing a number of metrics.

Lower sodium options by granting us highway the orphan drug exclusivity back in June.

And went on to state that you know the clinical superiority superiority findings.

Where are the die wave is clinically superior to Xyrem xyrem by means of greater safety because it provides a greatly reduced chronic sodium burden compared to xyrem.

And then you know.

The other driving factor as Bruce just mentioned of courses that we launched <unk> for the treatment of IH last week, which is the first and only FDA approved treatment for adults with idiopathic hypersomnia and we really see this launch is a significant value driver with approximately 37000 adult patients out there than diagnose.

First, we'll continue to provide the average number of Oxybate patients. We'll continue to provide the total number of patients on Zywave, and we will start to provide the breakdown of the number of Zywave patients based on the diagnosis of either Narcolepsy or IH.

First with IH and are actually out there actively seeking them.

Treatment for it in the health care system. So our commercial teams are working to educate right now about I wish I I H, while also very importantly, continuing to educate about the importance of transitioning narcolepsy patients to die maybe due to the benefits of the lower sodium so specifically.

Your next question comes from the line of Jessica Fye from JP Morgan. Your line is open.

Hey guys, good evening. Thanks for taking my question. Rene, you talked about how as the newly launched commercial portfolio matures and scales, you expect to realize further operating leverage. Can you talk about whether we should expect operating margin improvement in 2022 over 2021? Yeah, thanks for the question, Jeff.

Specifically and IH, we're focused on executing a very targeted launch strategy that includes both robust disease education and branded efforts and to support. This strategy. We have a variety of digital and in person efforts that are helping to demonstrate both the IH is a unique medical condition and the clinical benefit.

So I would say, stay tuned for 2022 guidance. As Bruce mentioned, we'll plan on giving that specific guidance in early 2022 when we're reporting our year-end results. And that would be more appropriate after we've gone through our full budget and goals process with our Board of Directors. But beyond that, I would think more broadly about, yes, as our newer products start to mature into products that have gotten through that initial launch phase that are off to a strong start, you should expect, over time, that operating margin, whether it be specific to SG&A or as we're thinking about our broader cost structure, to improve. Okay. Yeah, just trying to figure out if next year counts as one of the years of those launch products beginning to mature, or still kind of more of an investment year.

And safety profile of the I leave so moving forward, we're going to be providing a number of metrics.

First of all you know, we'll continue to provide the average number of acts of eight patients.

We'll continue to provide the total number of patients on Xyrem <unk> and we will start to provide the breakdown of the number of diagnosed patients.

Based on diagnosis of either narcolepsy or I H.

Got it thank you.

Your next question comes from the line of Jessica Fye from Jpmorgan. Your line is open.

Hey, guys. Good evening. Thanks for taking my question Renee you talked about how as the newly launched commercial portfolio matures and scales that you expect to realize further operating leverage can you talk about if we should expect the operating margin improvement in 2022 over 2021.

Yeah. Thanks for the question.

So I would say.

Stay tuned for 2022 guidance as Bruce mentioned, we will plan on giving that specific guidance in early 2022, when we're reporting our year end results and that would be more appropriate. After we've gone through our full budgeting gold's process with our board of directors, but beyond that I would think Laura.

I would say, without giving...

Yeah, I'd say, without giving specific guidance on what that would look like.

We'll be focused on ensuring that in 2022, we're positioned to achieve our goal of having 65% of our revenues associated with those newer products, that is, ZyWave, Epidiolex, Zepzelka, and Rylase. And as you think about where our focus is, it's making sure the long-term growth is positioning us to be able to achieve those operating margins. Of course, with the transaction, And we've also talked a lot about investing in our pipeline. So, while we're going to be focused on improving our bottom line margins, we're also going to be focused on ensuring that we're putting sufficient investment behind our R&D portfolio and pipeline to ensure that we're creating greater strength and greater durability.

Rodley about yes, as our newer products, then start to mature and to products that have gotten through that initial launch phase that are off to a strong start that you should expect over time that operating margin whether it be spur.

Specific to SG&A or as we're thinking about our broader cost structure to improve.

Okay got it yeah, I'm just trying to figure out if next year counts as one of the years of those launch products beginning to mature or still kind of more of an investment year.

Hi, Jonathan.

<unk>.

Go ahead Renee.

Yeah, I'd say without giving specific guidance on what that would look like will.

We'll be focused on ensuring that in 2022, we're positioned to achieve our goal of having 65% of our revenues associated with those newer products that being sideways appetite lacks that silica railways and as you think about where our focus is it's making.

Sure the long term growth is positioning.

<unk> us to be able to achieve those operating margins of course with the transaction. We did say that we expected accretion in the first full year and we've also talked a lot about investing in our pipeline. So while we're going to be focused on improving our bottom line margins. We're also going to be focused on insurer.

Your next question comes from the line of Jeff Hung from Morgan Stanley. Your line is open. Thanks for taking the question. You mentioned high persistency for the Epidiolex indicator.

Bring that we're putting sufficient investment behind our R&D portfolio and pipeline to ensure that we're creating greater strength and greater durability.

You mentioned high persistency for the Epidiolex indications. From here on out, which of the indications do you see as the bigger potential drivers for Epidiolex sales, and what kind of impact do you expect going forward potentially from off-label indications? Thanks. Dan or Kim, you want to jump in on Epidiolex? Yeah, I'm happy to start. And then Kim, you can add in, but as I mentioned in the earnings call, we anticipate, especially as the COVID-19 pressures ease, and based on the real world experiences that we've had with physicians who've adopted the therapy, that there's plenty of room for patient growth, across all three of our indications and kind of more broadly there's this pool of treatment resistant epilepsy patients you know 160,000 pediatric and a million overall Many of them are with syndromes that are not, that have no FDA approved therapies and so often the physicians are looking at, The seizure types for those disorders, and given that epidiolex has a broad range of activity across multiple seizure types and good market access, you know, to support physicians and patients in those settings, you know, like most anti epilepsy drugs, we do think that epidiolex will become a cornerstone of therapy across multiple seizure types beyond the the indicated label.

Thank you.

Your next question comes from the line of Jeff Hung from Morgan Stanley. Your line is open.

Thanks for taking the question you mentioned hyper system fee for the epic dialogues indication I guess from here on out which of the indications do you see as the bigger potential drivers for Abbott dialect sales and what kind of impact do you expect going forward potentially from off label indications. Thanks.

Dan or Kim you want to jump in on <unk>.

Yes, I'm happy to start and then Kevin you can you can add in that as I mentioned in this in the.

Earnings call.

We anticipate associated to COVID-19 pressures ease and based on the real world experiences that we've had with the physicians who have adopted the therapy that theres plenty of room for patient growth.

Across all three of our indications and kind of more broadly there's.

This pool of treatment resistant epilepsy patients.

60000, pediatric and $1 million overall.

Many of them are with syndrome that are not.

They have no FDA approved therapies and so often the physicians are looking at.

The seizure types for those disorders, and given that <unk> has a broad range of activity across multiple seizure types and good.

Market access to.

To support physicians and patients in those settings.

Like most of the anti epilepsy drugs, we do think that the dynamics will become a cornerstone.

Of therapy across multiple seizure types beyond the indicated label.

Kim, I don't know if you want to add anything. Yeah, I think you covered everything.

Tim I don't know if you want to add anything.

No I think you've covered all the points about them.

No, I think you covered all the points well, Dan.

Thank you.

Your next question comes from the line of Ami Saudia from Needham Your line is open.

Your next question comes from the line of Ami Fadia from Needham. Your line. Good evening, thanks for taking the question.

Hi, good evening, Thanks for taking the question I'm just.

Just more on Epidiolex, can you...

Just more on episodic can you.

Give us some more color on where you are with the patent application. You indicated that you expect it to be initiated, sorry, to be issued by the end of the year.

Give us some more color on where you are with the patent application you indicated that you expected to be initiated a study to be issued by the end of the year. So maybe any more color. There and then just with regard to the Medtronic atonic seizures.

So maybe some more color there. And then just with regard to the myotronic, atonic seizures, why did you pick that? What was the basis on which you thought that there was applicability to that in that seizure type? And if you could,

Why did you pick that one P basis on that she was hot.

That was applicability in that and that things are tight.

And if you could give us some preliminary sense of what the target market potential is if it works and that seizure dies, thanks. Yeah, I mean, nothing.

If you could.

Give us some preliminary sense of what is the target market potential if it works in that piece of it I think.

Yeah, I mean, nothing more to add on the timing of the of the new.

Yeah, I mean, nothing more to add on the timing of the new patent issuance and the Orange Book thing, and I'm not sure the timing of that is particularly important other than, obviously, what the long-dated expiration of that patent would be. Rob, maybe you could talk a little bit about why we've elected to go into the EMOS trial next, and then Kim or Dan, you can talk about potential in that marketplace as well. Rob?

Our patent issuance in Orange book, staying in and I'm not sure of the timing of that is particularly important other than obviously, what the long dated exploration of that patent would be Rob.

Rob maybe you could talk a little bit about why we've elected to go into the mass trial next and then Kim or Dan you cannot talk about the potential in that marketplace as well Rob.

Yeah, happy to Bruce. So, you know, first of all, there's an important unmet medical need for EMAS amongst pediatric epilepsies, and based on prior data and other seizure disorders, we think there's a high probability of it working in that setting, so there'll be a direct benefit to those patients. We also think it adds just evidence of broad anti-epileptic activity of epidiolex by studying a syndrome that is known to have a seizure type that is different than we currently have an indication for.

Yeah happy to Bruce So no first of all its an important unmet medical need in the us.

Amongst pediatric epilepsy and based on prior data and other.

Seizure disorders, we think theres a high probability that working in that setting so there'll be a direct benefit to those patients. We also think it pads just evidence of broad anti epileptic activity.

<unk> bye.

By studying a syndrome that is known to have a seizure type that is different than we currently have an indication for total complement.

And so it'll complement the seizure types that we've already addressed in our indications. And as you know, doctors treat different seizure types. They don't necessarily treat the underlying disorder as part of the epileptic therapy, and so it provides that additional data on broad activity across seizure types. And while we wouldn't promote off-label use, these are the kinds of data that physicians often look for to provide evidence of efficacy in the patients that they're intending to treat.

The C.

Seizure types that we've already addressed and our indications and as you know Dr Street seizure types, they don't necessarily treat the underlying.

Disorder as part of the epileptic therapies and so it provides that.

Additional data on broad activity across seizure types and while we wouldn't promote off label. These are the kinds of data that physicians often look for.

To provide evidence.

Efficacy in the patients that they are intending to treat.

Yeah, and just jumping in there, you know, EMOS represents approximately 2% of childhood epilepsies, so it's not an insignificant disorder, but, you know, even more importantly, it rounds out our data set, which includes, you know, strong activity and combined ability and safety and tonic, atonic, and now myoclonic and clonic seizure types. So it's this, you know, painting the broad evidence generation across multiple seizure types that, you know, are typically seen in this treatment-resistant epilepsy population, so that, along with other, you know, studies we're considering and investigator-sponsored studies, both looking at disorders, safety, efficacy endpoints, and other endpoints, you know, where we see benefit beyond seizure type or seizure reduction is part of our

And just jumping in there emailed us represents approximately 2% of childhood epilepsy.

Not a insignificant disorder, but.

Even more importantly, it rounds out our dataset, which includes.

Strong activity, and combinability, and safety and tonic atonic and now Myoclonic in clonic seizure types. So it's this.

The broad evidence generation across multiple seizure types that are typically seen in this treatment resistant epilepsy population so that along with other studies, we're considering an investigator sponsored studies both looking at disorders.

Safety efficacy endpoints and other endpoints.

We see benefit beyond seizure type.

Seizure reduction as part of our overall evidenced plan.

Your next question comes from the line of Gary Nachman from BMO Capital. Your line is open.

Thank you.

Your next question comes from the line of Gary Nachman from BMO Capital. Your line is open.

Hi, good afternoon. Could you talk about the overall reimbursement and access for XyWave, how the net pricing has been trending for the narcolepsy indication, what the initial status has been for IH, how you've been managing that? And then what might change when an AG of XyRM is available next year? How much visibility do you have on that at this point? And then just one other one, if I could sneak

Hi, good afternoon.

You talk about the overall reimbursement and access because I always have the net pricing has been trending for the narcolepsy indication what the initial status has been for IH have you been managing that and then what might change when an EG of Xyrem is available next year, how much visibility you have on that at this point.

And then just one other one if I could sneak it in.

Just on Shinose, there was a big acceleration, it seems, in the third quarter. So you didn't comment on that in the prepared remarks. But how much of that is net pricing versus actual demand volume?

Just on Sanofi, there was a big acceleration it seemed in the third quarter. So you didn't comment on that in the prepared remarks, how much of that is net pricing versus actual demand volume right.

Thanks. Uh, Kim, maybe you could address both those Zywave payer dynamics now and going forward, as well as Cenosi progress in the third quarter. Sure, yep. So with Zywave, you know, we're very pleased that we continue to have greater than 80% commercial coverage for patients with narcolepsy. And this really sets us up well for IH, I think we've said, and we continue.

Okay.

Kim maybe you could address both of those XI waves payer dynamics, now and going forward as well as Sanofi progress from the third quarter.

Sure, Yes, so with <unk>.

We're very pleased that we continue to have greater than 80% commercial coverage for patients.

You know in narcolepsy, and that's really sets us up well for IHS I think we've said and we continue to see.

With the launch of IH, really, what we are looking to do is to see payers add utilization management criteria to the existing contract and coverage for Zywave, and that criteria be specific to patients with IH. In the meantime, and we're anticipating that that will happen as fast as, if not faster than it did with the launch of Narcolepsy, where our goal was, and we saw achieve broad coverage within six to nine months or so of launch.

You know with the launch of I H really what we are looking to do is see payers add basically utilization management criteria to the existing contract and coverage for XI weighed in that criteria being specific to.

Patients with I H in.

In the meantime, we're anticipating that that will happen as fast as if not faster than it did.

With the launch of Narcolepsy, and you know where our goal was and we saw us achieve broad coverage within six to nine months or so.

In the meantime, you know, many patients can pursue, you know, the medical exception process and get coverage there. And then, lastly, where that doesn't work, we do have patient access and support programs available for those patients, starting with day one of launch.

Launched in the meantime, you know many patients can.

Pursue you know the medical exception process and kind of get coverage. There and then lastly, where that doesn't work, we do have patient access and support programs.

Caleb.

Those patients.

You know starting with one day one of launch.

I think your next question, perhaps, was about what might change in terms...

I think your next question, perhaps was about what made sales in terms of the AG and our coverage situation.

about what might change in terms of, you know, the AG and our coverage situation, we feel, you know, quite confident that we will continue to enjoy strong coverage, based on our conversations with payers in this space. You know, we don't anticipate for them to really, you know, change the coverage and ultimately put down the AG side by side, you know, with Xyrem specifically on their formulary, not advantaging or disadvantaging in any way.

We feel quite confident that we will continue to enjoy strong coverage.

Based on our conversations with payers in the space and we don't anticipate.

And anticipate for them to really change the coverage and ultimately to put down the AG side by side with Xyrem, specifically on their formulary not advantaged or disadvantaged in any way.

And then Kim, maybe just a comment on what we saw in Sanosi in the third quarter. Yeah, sure. In the third quarter, we saw that, you know, Cenosi sales more than doubled.

And then Tim maybe you can just comment on what we saw in Sanofi and the in the third quarter.

Yeah sure. So in in the third quarter, we saw that you know Sanofi sales more than doubled compared to the same period last year and we saw prescriptions.

Page PAGE of NUMPAGES www.verbalink.com

Typically you know increased by 8%.

Third quarter over the second quarter. So you know since launch we've seen very encouraging reactions to the profile of Sanofi from both our physicians and our patients and we continue to receive positive feedback from that.

Since launch, we've seen very encouraging reactions to the profile of Cenosi from both our physicians and our patients, and we continue to receive positive feedback from those who have actually utilized the product. Patients have a really good experience with Cenosi. In terms of what they're seeing is the impact on their excessive daytime sleepiness, and these are patients who have often been quite frustrated that they've rotated to other weight-promoting agents and stimulants over time. But I don't have the breakdown of that growth as to what was demand and what was price. I don't know, Renee, if you have that or not.

Those who've actually utilize the product and the patients have a really good experience and Sanofi in terms of what their small the impact on of excessive daytime sleepiness. In these are patients who have often been quite frustrating tradable rotated through other wake promoting agents and their rents over time.

Don't have the breakdown of that growth.

What was demand and what was price I I don't know Renee, if you have that or not.

Yeah, I don't I don't have that in front of that but certainly we saw.

Yeah, I don't I don't have that in front of me, but certainly, we saw Growth to Net Stabilized a few quarters after launch as we finalized our broad access. So what you're seeing now almost exclusively represents volume growth.

Gross to net stabilize a few quarters after launches as we finalized our.

Broad access so what youre seeing now.

Almost exclusively represents volume growth.

Your next question comes from the line of Akash Tewari from Jeffery. Your line is open. Hey guys.

Okay, great. Thank you.

Your next question comes from the line of <unk> <unk> from Jefferies. Your line is open.

Hey guys, and I apologize for this question being a bit on the nose, but what is the current market penetration for Epidiolex and Dravet, LGS, TST, and other refractory epilepsies? And then maybe on guidance, it looks like full year guidance was lowered by $70 million for SG&A, and R&D by about $45 million, and you talked about kind of three different reasons for that. How much of the OPEX decrease was spend that was supposed to occur in 2021 going to 2022, given COVID-19, and how much of that was GW integration and R&D prioritization? Can we expect a more 4Q-like cost basis going forward into next year or not?

Hey, guys and I apologize for this question being a bit on the nose, but what is the current market penetration for epic dialects and drove that.

G S TST and other refractory epilepsies.

And then maybe on guidance it looks like full year guidance was lowered 70 million for SG&A R&D about $45 million and you talked about kind of three different reasons for that how much of the Opex decrease was spend that was supposed to occur in 2021 going to 2022, given COVID-19, and how much of that was GW.

Our integration and R&D prioritization can we expect a more for Q like cost basis going forward into next year or not thank you.

Thank you. So Dan or Kim, maybe I'll ask you to talk a little bit about how it is used in our existing indications and where we are there in terms of room for growth. And then Renee, perhaps I can ask you to weigh in on the cost side.

So Dan or Kim.

Maybe I'll ask you to talk a little bit about Houston, our existing indications and where we are there in terms of <unk>.

Room for growth and then Renee, perhaps I can ask you to weigh in on the cost side.

Yeah, I mean, sure. What I'll basically say is that we're, you know, please.

Yeah sure what what I basically say is that we're pleased with the pit haven't penetration rates. We were seeing I don't think we share the specific.

with the penetration rates we're seeing. I don't think we can share the specific data on that, but what we see is that there is substantial room for growth, particularly in LGS and our newest indication around TSD. So we remain very encouraged in terms of the growth opportunity for this product across indications.

Data on that but you know what what we see is that there is substantial.

Substantial room for growth, particularly in lgs, and our newest indication around PSC. So we remain very encouraged in terms of you know the growth opportunity for this product across the indications.

for this product across the indications. Yeah, and maybe I'll just add, and while there's, you know, some use outside of those disorders, there's clearly a lot of it has a very small penetration into that treatment-resistant patient population, whether it's the pediatric population of 160,000 or the million overall.

Yeah, and maybe I'll, just add and while there is.

Some use outside of those disorders, there's clearly a lot of it's a very small penetration into that treatment resistant patient population, whether it's the pediatric population of 160000 or the million overall, so again I think the real world experience plus dataset will continue to support.

So again, I think the real world experience plus data set will continue to support, you know, strong growth going forward. But do we know what percent of sales are in the other refractory epilepsies as a percent of total sales for epidiolex right now? Yeah, we're not providing that level of detail at this point.

The strong growth going forward.

Do we know what percent of sales in the other refractory epilepsies as a percent of total sales for <unk> right now.

Yeah, we're not providing that level of detail at this point.

And I'm happy to jump in on OPEX. So really, the categories, of course, that I provided are where we're seeing the biggest part of the shift in OPEX. We're trying to be very thoughtful about how we integrate Jazz and GW, much of which has already been completed.

And I'm happy to jump and then on Opex. So really the categories of course that I provided are where we're seeing the biggest part of the shift in opex, we're trying to be very thoughtful about how we integrate jazz and GW.

Much of which has already been completed and as we prioritize some of these activities be it on the commercial side, our R&D activities. It's really focused on where are we going to get the maximum value. When we initially provided our guidance and roll that forward in the prior call we were continuing.

And as we've prioritized some of these activities, be it on the commercial side or R&D activities, it's really focused on where we are going to get the maximum value. When we initially provided our guidance and rolled that forward in the prior call, we were continuing to learn how the operations were coming together, continuing to figure out what we needed to invest appropriately behind our combined pipeline and our commercialization activities. And we're also looking at how we should operate moving forward as a larger combined company and how to be more effective and efficient as we prepare ourselves to scale with our increased revenue growth over time.

To learn how the operations were coming together continuing to figure out what we needed to invest appropriately behind our combined pipeline and our commercialization activities and we're also looking at how we should operate moving forward as a larger cause.

Buying a company and how to be more effective and efficient as we prepare ourselves to scale with our increased revenue growth over time. So that's largely how I would encourage you to think about the way that we've brought down the expenses and then I would also say with respect to them being <unk>.

So that's largely how I would encourage you to think about the way that we've brought down the expenses. And then I would also say with respect to the implied Q4 numbers; I wouldn't immediately apply those to our future rates. As I mentioned earlier, we'll provide specific guidance for 2022 as we report out our year-end earnings in early 2021. And then I would also just remind you, as we stated in our prepared remarks, that in Q4, we're launching IH. We're also initiating multiple clinical studies, sorry, clinical studies in the quarter. And so there is some expense that's associated with taking on initiation and getting those underway.

Slide Q4 numbers I wouldnt immediately apply those to our future our future rates as I've mentioned earlier, we will provide specific guidance for 2022 as we report out our year end earnings in early 2021, and then I.

I'd also just remind you we stated in our prepared remarks that in Q4, we're launching IH were also initiating multiple clinical studies, sorry clinical studies in the quarter and so there is some expense that's associated with with taking off.

On initiation and getting those underway.

As a reminder, please limit yourself to one question each. Thank you.

As a reminder, please limit yourself to one question. Each. Thank you. Your next question comes from the line of.

Your next question comes from the line of Umar Rafat from Evercore. Your line is open. Umar, are you there? Amirah Fox from Evercore, Elias Ophan, and your next question comes from the line of Balaji Prasad from Barclays. Your line is open.

Rafat from Evercore Your line is open.

Yeah.

Whom are you there.

A matter of fact from Evercore. Your line is open.

Your next question comes from the line of <unk> Prasad from Barclays. Your line is open.

Hi, good afternoon. Thanks for the questions. I just want to discuss pediatrics a bit further. While I understand that you had limitations in accessing pediatricians, the data points and interactions you gave are quite insightful. But what I'm struggling to understand is the lack of vaccines and how that's impacting on the ground. I'm surprised that parents with kids suffering from epileptic conditions are not accessing or getting the treatment needed.

Oh, Hey, good afternoon, and thanks for the questions.

Just wanted to probe disclose at that Alex a bit farther.

Why do I understand that you had limitations on access in pediatric patients the data point and interactions going down you gave us quite insightful well one just struggling to understand is the lack of vaccine and how that's impacting on the ground I'm surprised the bands with kids suffering from epilepsy epilepsy conditions.

Are not accelerating or getting the treatment need it.

Maybe some qualitative or quantitative comments on that. And secondly, maybe just on the individual markets, do you have a better understanding of the current market size for Lenox-Castor and Dravet syndrome currently? What's the number of patients that are out there, and penetration, if you have any?

Maybe some qualitative or quantitative comments on that and secondly, maybe just on the individual markets do have a better understanding of the market size of <unk>.

And then I'll discuss toward dry eye syndrome, currently and what's the what's the number of patients that are out there and.

Penetration of Tesco.

Yeah, on the first part of the question, maybe I'll just jump in and I want to talk a little bit about what I've heard from parents and treaters during this period, which is... You know, parents of kids with these refractory seizure disorders are very interested in getting to better seizure control and a better overall health status for their child, but they can be worried that in the process of changing meds, you can disrupt And so we think, based on conversations again with both parents and providers, that there's been a tendency to avoid making those changes for fear of having to go into a medical environment and risk COVID with unvaccinated kids during this period. We don't think that's unique to Epidiolex as a product. We think that's more general for these treatments and these conditions generally.

Thank you.

Yeah on the first part of the question, maybe I'll just jump in and talk a little bit about what I've heard from parents and treaters.

During this period, which is.

You know parents of kids with these refractory a seizure disorders are.

Very interested in getting to better seizure control and better all over overall health status of their child, but they can be worried that in the process of changing meds.

Can disrupt in a way that can can actually bring on.

Additional seizures during that change and those additional seizures can in some cases result in needing to visit a hospital and so we think based on conversations again with both a pair.

Parents as well as treaters that there has been a tendency to avoid making those changes for fear of having to go into a medical environment and.

And risk Covid with Unvaccinated kids. During this period, we don't think that's unique to <unk> as a product. We think that's more general for these treaters in these conditions generally.

Your next question comes from the line of Esther Rajavello from UDS. Your line is open. Hey, thanks for giving me the question. I'm going to add to the list of dialect questions here.

Your next question comes from the line of Esther <unk> from UBS. Your line is open.

Hey.

Thanks for giving me the question I'm going to add to the list of questions here.

For the OUF markets, can you share any early...

For the U S market can you share any early feedback from prescribers and families I'm basically trying to get a sense for pent up demand in the developed markets and then in the U S. Among <unk> patients can you share with us whether any of the newer drugs like <unk> are used in combination with other dialects.

Prescribers and Families. I'm basically trying to get a sense for pent-up demand in the developed EU markets and then in the U.S. among Dravet patients.

Can you share where?

whether any of the newer drugs like Centepla are used in combination.

with Epidiolex. And then lastly, can you give us some color on the proportion of the GW?

And then lastly can you give us some color on the propulsion GW sales force that continues to be employed by Chaz.

I love you, Salesforce, that continues to be employed by Jazz, and whether you've had any.

And whether you've had.

has had to expand hiring efforts in the U.S. for this product.

And hiring I think somebody will ask for this product.

Go ahead, Dan. Yeah, I was just gonna jump in on the XUS and then leave.

Yes, maybe I'll just go.

Go ahead David.

Yeah, I was just going to jump in on the ex U S. And then the other question, but on the <unk> side, we've got a strong team much like we had in the U S that GW had built up.

We've got a strong team, much like we had in the U.S. that GW had built up in the major market countries, and importantly, the gaining factor, of course, is getting favorable reimbursement, and we've now achieved that in four of the five major countries, and that really opens the gate to full promotion and rollout. And in the fall, we've got additional growth going on with the two markets that most recently got that reimbursement, which were Italy and Spain.

And the major market countries and importantly, the gating factor of course is getting a favorable reimbursement and we've now achieved that in four of the five major countries and that really opens the gate to full promotion and rollout and in.

In the fall, we've got the additional sort of growth going on with the two markets that most recently got that reimbursement, which were Italy and Spain.

We're very targeted now at the fifth remaining country, which is France, which could be a very significant growth market for us, and one that we anticipate to be launching into in 2022. I think relative to other sort of orphan price branded products, to have overall pricing in these major countries at greater than 70% of the wholesale acquisition cost in the U.S. is very successful, and it really speaks to both the market need, the product profile, and the data that's been generated.

We're very targeted now on the fifth remaining country, which is France, which could be a very significant growth market for us.

And that one we anticipate to be launching into in 2022.

Relative to other sort of orphan priced branded products to have a overall pricing in these major countries that greater than 70% of the wholesale acquisition cost in the U S is a very very successful.

And it really speaks to both the market need the product profile and the data that's been generated so we look forward to further updates, but that definitely was a big part of our evaluation of that the dialogues with the worldwide potential for this.

So we look forward to further updates, but that definitely was a big part of our evaluation of Epidiolex, the worldwide potential for this important new therapy. And then I'll jump in on the last part of your question. Operator, I think we were not quite done. So on Salesforce, you know, the North American business unit within GW, the Greenwich team was brought over in its entirety to Jazz. So no, there's been no reduction in that effort. Again, we're trying to build on the success that GW is enjoying and move forward together.

Important new therapy.

And then I'll jump in on the last night for additional questions.

Operator, I think we're not quite done so.

On the sales force.

The North American business unit within GW, the Greenwich team was brought over in its entirety.

Two to jazz so no there's been no reduction in that effort.

Again, we're trying to build on the success that GW is having.

And move forward together.

Um, on the question about combination use with Pentepla, you know, I would say in general we see combination use of products for these conditions. We hear good feedback about the combination of epidiolex with other agents in terms of its side effect profile, in terms of ease of initiation of adding epidiolex to other medicines. We hear that when patients are rotating off treatments, they often preferentially continue on Epidiolex. So, I'm not sure I have lots of quantitative data on Fintepla specifically at this point, but I'd say what we hear about the use of Epidiolex in general seems to be what we're hearing here as well.

On the the question about combination use with Tesla.

I'd say in general we see combination use of products.

For these conditions.

We hear good feedback about combination of epic dialogues with other agents.

In terms of its side effect profile in terms of ease of initiation of adding up of dialects in.

We hear that when patients are rotating off therapies. They often preferentially continue on epic dialects. So I'm not sure I have lots of quantitative data on Fintech play specifically at this point, but I'd say, what we hear about use of Epidiorite. Some general seems to be what we're <unk>.

Hearing here as well.

Yeah, Bruce, I'll just throw in a couple of proof points.

Yeah, Bruce I'll just throw in a couple of proof points, let me know Dan shared earlier that what we're seeing in market researches at about 40% of respondents indicate they are you know moving epidiorite up in their treatment algorithm. So we see that as a very good signal and believe it's underpinned by more prescribers, having a positive experience.

As Dan shared earlier, what we're seeing in market research is that about 40% of respondents indicate they are, you know, moving epidiolex up in their treatment algorithm. So we see that as a very good signal and believe it's underpinned by more prescribers having, you know, positive experiences with epidiolex over time and gaining experience with the product. And then the other point is that we see very strong persistence with the product.

With epidiorite overtime, and gaining experience with the product and then the other point is just we see very strong for assistance with the product once patients go on this product you know they they stay on it for a really long time. So I think both of those you know are data points that point to that level of satisfaction out there in the market on the part of both prescribers.

Once patients go on this product, you know, they stay on it for a really long time. Both of those are data points that point to levels of satisfaction out there in the market on the part of both prescribers and patients.

Your next question comes from the line of Ronnie Gao from Bernstein. Your line is open.

And patients.

Yeah.

Your next question comes from the line of Ronny Gal from Bernstein. Your line is open.

Good afternoon, and thank you for taking my question.

Good afternoon, and thank you for taking my question.

Thank you for taking my question. Just about Rylai's, you know, the peak of the product, the peak for the Arowanaise market, was around $200 million. It kind of came down to around $170 during the year when there was not enough supply. I was kind of wondering, as you now have more information with the launch of Rylai, where do you see the end of the kind of initial ramp-up where you simply replace Arowanaise and versus where you'll have to start building the demand further with the marketing just to help us look at the shape of that product for the next couple of years? Yeah, Dan, maybe I could ask you to jump in on just the overall market opportunity with Riley's moving forward, both us and x us as well. Yeah, no, it's a good question, Ronnie.

Just about <unk>.

All of the prior to the pick for the aerospace market was around $200 million.

It came down to around 170.

During the year when there was not enough supply and I was kind of wondering as you now have more information with the <unk> launch.

Where do you see the end of the kind of initial ramp up we simply replace.

Irwin A's and versus where you'll have to start building.

The demand further with some marketing just kind of help us.

Look at the shape of that product for the next couple of years.

Yeah, Dan maybe I could ask you to jump in on just the overall market opportunity with with Riley's moving forward, both U S and ex U S as well.

Yeah, no. It's a good question Ronny.

And I think we don't quite know how big the market could become because, as you know, as we ran into those supply constraints more than five years ago, we pulled back all promotional efforts, all medical education, and initiatives. And we had to put in fairly strict ordering policies where it was on a, you know, patient by patient basis. And, you know, institutions really had to triage which patients got the therapy.

We don't quite know how big the market could become because as you know as we ran into those by.

By constraints no more than five years ago, we pulled back on promotional efforts all medical education and its initiatives and we had to put in fairly strict.

Oregon policies, where it was on a patient.

Patient by patient basis, and institutions really have to triage, which patients got the therapy. So I think in addition to growing back the market fully there's also the retraining of physicians and caregivers have any opportunity that at the slightest hypersensitivity reaction you don't continue to reach.

So I think in addition to, you know, growing back the market fully, there's also the retraining of physicians and, you know, caregivers having the opportunity that at the slightest hypersensitivity reaction, you don't continue to re-challenge as they may have during shortages and sort of risk anaphylactic shock, but you give the opportunity to switch more quickly to a non-E. coli based asparaginase You know, and importantly, with Rylase, given that we had a year's supply at the time of launch and a very robust supply chain, the institutions and COG who worked with us on the study have great confidence that they can look for silent inactivation, look for that hypersensitivity reaction, and really grow the market. We said, in addition to that, there's an opportunity to go more fully into adolescent and young adult, which is...

They may have during shortages and sort of risk anaphylactic shock that you give the opportunity to switch more quickly to a non E coli based <unk> and <unk>.

Fortunately with <unk>, given that we had a year supply at the time of launch and very robust.

Supply chain.

Institutions, and <unk>, who worked with us on the study have great confidence that.

They can they can look for silent in activation look for that hypersensitivity reaction and really grow the market.

Said in addition to that there's an opportunity to go more fully into adolescent young adult.

which could be sizable, and there's You know, more drug use there because it's on a per-website.

As could be sizable and theirs.

You know, more drug use there because it's on a per weight basis, and then there are geographies like Japan that have an unmet need where the product never got introduced because of supply and quality issues, and you know Rylase is in a very different situation, so I look forward to giving sort of further color to exactly what that potential could be, but we do see it as a growth driver for our immediate future.

More drug use there because it's on a per well basis, and then theres geographies like Japan.

That has a unmet need where the product never gotten introduced because of supply and quality of Susan Rai leases in a very different situations. So look forward to giving sort of further color to exactly what that potential could be but we do see it as a growth driver for the immediate future.

Your next question comes from the line of Brandon Folkes from Cantor Fitzgerald. Your line is open.

Your next question comes from the line of Brendon Folkes from Cantor Fitzgerald. Your line is open.

Hi, thanks for taking my question. I just want to circle back to Zywave. The goal of having 50% of patients covered, or more than 50% of patients on Zywave by 2023. You seem to be well on your way there, but maybe can you just talk about how dependent achieving that goal is on IH from here? Thank you.

Alright, Thanks for taking my question and I, just want to circle back.

Back to sideways.

The goal of having 50%.

We're more than just kind of patient.

On Norway.

By 2023, and you seem to be well anyway, there, but maybe can you just talk about how dependent achieving that goal is on IHS from here. Thank you.

Yeah, maybe I'll jump in on that one and just say, you know, we picked a date a little farther out in this metric of 2023 because we specifically wanted to address what we think would happen to Zywave even in the face of competition from a generic or branded higher sodium Oxibate. So it wasn't so much just a continuation of the existing trend and where we'd get to, but where we'd still be after a potential other entrance to the marketplace. So hopefully that makes that metric a little bit clearer to you.

Yeah, maybe I'll jump in on that one and just say we picked a date a little farther out in this metric of 2023, because we specifically wanted to address what we think would happen to XI wave even in the face of competition from a generic or brand.

Higher sodium.

Ox abate so it wasn't so much just a continuation of the existing trend and where we'd get to but we're we'd still be after a potential other entrants to the market place. So hopefully that makes that metric a little bit clearer to you.

You know, we do see a very significant opportunity in adipathic hypersomnia with no indicated treatments prior to our launch last week of high-wave patients who really need effective therapy to treat excessive daytime sleepiness and symptoms even beyond that. NIH, you know, this is a new launch. No product has been promoted in this space before. So we do have some education to do.

We do see a very significant opportunity in idiopathic hypersomnia with no indicated treatments prior to our launch last week of <unk>.

Wave.

Ah patients, who really need effective therapy.

To treat excessive daytime sleepiness, but but sometimes even beyond that.

NIH.

This is a new launch no product has been promoted in this space before so we do have some education to do.

It's also a little unlike Psywave in narcolepsy, where many of our Zywave patients were coming over already titrated up and on an effective dose of Zyram and then moved over dose for dose. You know, obviously, a naive IH patient coming on would be titrated up on dose over time. So a little bit different dynamic in terms of uptake, but we certainly see that as a significant opportunity, potentially, over time, rivaling the size of narcolepsy in terms of potential overall patients with better diagnosis and treatment. We're not predicting that in the near term, but certainly that opportunity is there for a really substantial improvement for a number of patients.

It's also a little unlike sideways.

In narcolepsy, where many of our sideways patients were coming over already titrated up and on our effective dose of Xyrem and then moved over dose for dose.

Obviously, a naive IH patients coming on will be titrated up on dose.

Over time, so a little bit different dynamic in terms of uptake, but we certainly see that as a significant opportunity potentially over time rivaling the size of narcolepsy in terms of potential overall patients with better diagnosis and treatment and we're not predicting that in the near term but.

Certainly that opportunity is there for a really substantial.

Approval for a number of patients by age.

Your next question comes from the line of David Amsellem from Piper Sandler. Your line is open.

Your next question comes from the line of David Solomon from Piper Sandler Your line is open.

Thanks. So on Epidiolex, with the clear evidence of some off-label use beyond the three indications in the U.S. label, I was wondering if I could get your thoughts on payer contracting and just trying to get more aggressive with payers such that you could facilitate less in the way of utilization management. What do you think about that?

Thanks Ana dialogues.

With the.

The clear evidence of some off label use beyond the three.

Indications in the U S label.

I'm wondering if I could get your thoughts on payer contracting and just trying to get more aggressive with payers such that you could facilitate less in the way of utilization management.

How do you think about that.

And then, I'm sorry if I missed this, but are you disclosing or did you disclose the ex-U.S. contribution from Epidiolex during the quarter? If you can disclose that, that would be helpful too. Thanks.

And then I'm sorry, if I missed this but are you disclosing or did you disclose the ex U S contribution from <unk> during the quarter. If you can.

Clothes that that'd be helpful too. Thanks.

Yeah, David, I'll take the second half of your question and say, I don't think we've provided a specific U.S. versus ex-U.S. breakdown product by product. But we're really excited about how the Epidiolex launch continues to roll out in Europe across markets, both in terms of, you know, pricing and access we're receiving, but also how our teams are performing in the early periods of these launches and see this as a really significant opportunity relative to the U.S. over time. On payer coverage and what that means in terms of utilization of the product, Kim, could I ask you to weigh in on that? Yeah, sure. So right now, we're very pleased that Epidiolex is enjoying such success.

Yeah, David I'll take the second half of your question and say I don't think we've provided a specific U S versus ex U S breakdown product by product.

But we're really excited about how the Epidiorite X launch continues to roll out.

In Europe across markets, both in terms of.

No pricing and access we're receiving.

But also how our teams are performing in the early periods of these launches and see this as a really significant opportunity relative to the U S.

Overtime.

On payer coverage and what that means in terms of utilization.

Of the product Kim could I ask you to weigh in on that.

Yeah sure.

So right now, we're very pleased that epidiorite enjoys and 98% commercial coverage across.

Joy is 98% commercial coverage across commercial lives.

Commercial lives and and yes. As you suggest we are you see it as a strategic priority and we are focused on trying to broaden that coverage. So that coverage is in the indicated.

And yes, as you suggest, we are, you do see it as a strategic priority, and we are focused on...

I'm trying to broaden that coverage, and so that coverage is in the indicated lives that we have. We are working with payers to try to broaden it.

Lives that we have we are working with payers to try to broaden that coverage and we've been very successful on that front in the Medicaid space and are continuing to try to get there in the commercial space.

And we've been very successful on that front in the Medicaid space and are continuing to try to get there in the commercial space.

Your next question comes from the line of Ken Kasha Twar from Cohen and Company. Your line is open. Hey Bruce and team, sorry.

Your next question comes from the line of Ken Cacciatore from Cowen and company. Your line is open.

Hey Bruce and team, sorry I'm really late getting on the call, but I wanted to go back and ask about your reference to the Epidiolus composition of matter-like patents. Can you get into a little bit of nuance on these patents, more on the specificity of them? Was this being worked on for a while at GW, part of your original diligence, and you were aware of them, something that maybe you helped them with? Can you give a little more specificity about them? Thank you.

Hey, Bruce and team sorry, I'm really late getting on the call, but I wanted to go back and ask about you referenced to the epic diode composition of matter like patents can you get into a little bit of nuance on on these patents more than the specificity.

Them, but does this being worked on for a while at GW part of your original diligence and you you were aware of them something that maybe you help them with can you give a little more specificity around that thank you.

Yeah, Ken, this is something we were aware GW was working on. I think GW did make reference to it publicly on a couple of occasions. We're getting more specific now just about timing. I think we'll wait to say more until that patent is visible to everyone and we can talk about it more specifically. I don't think it makes sense to do so right now. But, you know, obviously, what we're trying to communicate is that intellectual property continues to broaden, that it has different pieces to it and can have different expiration dates, in this case, out to 2039.

Yeah. Ken This is something we were aware GW was working on I think GW did make reference to it publicly on a couple of.

Occasions, we're getting more specific now just about timing.

I think we'll wait to say more until that patent is visible to everyone and we can talk about it.

More specifically I don't think it makes sense to do so right now, but you know obviously, what we're trying to communicate is that the IP continues to broaden.

That it has different pieces to it.

And can have different expiration dates in this case after 2039, so more to come when we have more in the public domain, but just wanted to make sure people are focused both on the near term.

So more to come when we, you know, have more in the public domain. But just wanted to make sure people are focused both on the near-term opportunity for Apidiolex in the U.S. with the XUS launch that's underway, potential new indications, broader use, but also recognize that we view this as a very durable asset.

Our opportunity for App dialects in the U S.

In the ex U S launch that's underway in potential new indications in broader use but also recognize that we view this as a very durable asset.

Your next question comes from the line of Greg Fraser from TruViz Security. Your line is open. Good afternoon, folks, and thanks for taking the question.

Yeah.

Your next question comes from the line of Greg Fraser from Coors Securities. Your line is open.

Good afternoon folks and thanks for taking the question.

What percentage of new docs debate patients are being prescribed sideways versus Xyrem you mentioned, a large majority, but can you be more specific in what are the reasons that you hear as to why us debate naive patients or are still prescribed xyrem is it access related positions just aren't aware of evaluated yet any color on that would be helpful. Thanks.

What are the reasons that you hear as to why obstinate, naive patients are still prescribed XyRev? Is it access-related? Physicians just aren't aware of XyWave yet? Any color on that would be helpful.

Yeah, Greg, I particularly like the end of that question. That's always a good question. When you've got a better therapy, a superior therapy available. Kim, you want to talk a little bit about oxidate naive patients and what we're seeing and what might be driving that? Yeah, so there are a couple of reasons. One is that, you know, while we have very strong commercial coverage of over 80% in

Yeah, Greg I'd, particularly like at the end of that question. That's always a good question.

When you've got a better therapy, a superior therapy available Kim you want to talk a little bit about oxalate naive patients and what we're seeing and what might be driving that.

Yes.

So a couple of reasons. So one is that you know, while we have very strong commercial coverage over 80% and commercial patients. There is still a portion of patients that don't have immediate access to xyrem. So that's one of the reasons, but really the biggest reason out there right now is that health care you know that.

There is still a portion of patients that don't have immediate access to Xyrom, so that's one of the reasons. But really, the biggest reason out there.

https://www.hcps.gov

IRA is Ah patients love their xyrem and HCP loved Xyrem and so the number one reason we're hearing.

and so the number one reason we're hearing is, you know that I'm sorry that's on the transitions that patients are satisfied with.

And you know that I'm sorry, that's on the transitions that patients are satisfied with xyrem, but yeah. We still have some work to do as I said before with some segments of physicians.

We still have some work to do as a team.

As I said before, with some segments of physicians and really motivating them, you know, to adopt GyWave based on the low sodium, but we feel very confident that we're making strong progress there and that these, you know, smaller segments of healthcare professionals will

Really motivating them to adopt <unk> based on a low sodium but we feel very confident that we're making strong progress there and that these smaller segments at HCP will eventually.

In a move along that continuum and joined the rest of the high volume activate prescribers, who really do you see the benefits.

Your next question comes from the line of Annabel Samimy from Stifel. Your line of Annabel, are you there? Annabel Samimy from Stifel, your line is open. Your next question comes from the line of Navan T from Citi. Your line is open. Hi, good afternoon. First, a follow-up on the lower than expected SG&E and R&D. Are you able to tell us which products will be impacted by the lower selling and R&D expenses?

Hum selling with a product that lowers that burden.

Your next question comes from the line of Annabel <unk>.

From Stifel. Your line is open.

Annabel are you there now.

Yeah.

Annabel Sammy me from Stifel. Your line is open.

Your next question comes from the line of <unk> from Citi. Your line is open.

Hi, good afternoon.

Just a follow up on the lower than expected SG&A.

and R&D expenses, which will be prioritized. And then my second question is on your latest thoughts on the litigation versus Avadell FT-218 after the action date was delayed. Thank you.

R&D, maybe able to tell us which products will be impacted by the lower selling and R&D expenses.

Which will be prioritized and then the second question is on your latest thoughts on Digitization versus other.

F Q2, one eight of taking action divesting eight thank you.

Yeah, I'll take the second part of your question first and just say nothing additional to say on the litigation, uh, ongoing with uh around FT218. We obviously have existing IP which you've seen more of over time, and we'll defend that IP as we see fit. On the expense side... What we were lowering here was guidance for the full year. In terms of overall spending across two organizations that just came together a few months ago, as well as our expectations, you know, in particular as we have more visibility late in the year. Rene, I'll let you weigh in on what else you want to disclose there. Yeah, actually. I think you've covered it.

Yeah I'll take the second part of your question first and just say nothing additional to say on the litigation.

Ongoing with.

Around the F. T 218, obviously, we have.

Our existing IP, which as you've seen more of over time and will.

Defend that IP as we see fit.

On the expense side.

We were lowering here was guidance for the full year.

In terms of overall spending across two organizations that just came together a few months ago.

As well as our expectations in particular as we have more visibility late in the year Renee I'll, let you weigh in on what else you want to disclose there.

Yeah actually I think you've covered it and I think just to address the specific question in terms of how does this look by product. If you think about the commercial side. Obviously, we have multiple product launches, we've been moving forward and the impacts of COVID-19 and that lack of it.

And I think just to address the specific question in terms of how this looks by product, if you think about the commercial side, obviously, we have multiple product launches, we've been moving forward, and the impacts of COVID and that lack of in-person interaction that many companies had expected to grow in Q3 and Q4 haven't been impacted by COVID. So it's not specific to one product necessarily, other than in thinking about where we're really putting our commercialization dollars right now. And that is to support the new product launches that we've talked about representing the 65% of revenues that we expect in 2022 from those products that have been launched or acquired since 2019.

In person interaction that many companies had expected to grow in Q3, and Q4 has been impacted by Covid. So it's not specific to one product necessarily other than and thinking about where were really putting our commercialization dollars right now and that is.

To support the new product launches that we've talked about representing the 65% of revenues that we expect in 2022 from those products that have been launched or acquired since 2019, so sideways at the dial accept.

This concludes our question and answer session. I would now like to turn the conference back to Mr. Bruce Cozadd for his closing remarks.

<unk> Riley and.

And Sanofi.

Yeah.

This concludes our question and answer session I would now like to turn the conference back to Mr. Bruce <unk> for closing remarks.

Yeah, thanks, operator. And thanks to all of you for the good questions.

Yeah, Thanks, operator, and thanks to all of you for the good questions. You know I'll just say, we're really happy with where we are this year in terms of a kicking off our fifth launch.

You know, I'll just say we're really happy with where we are this year in terms of kicking off our fifth launch, continuing progress early on in the launches of Rileys, and continuing to progress Zep Celka. You know, a flurry of activity at the end of the year, initiating some mid and late stage trials we're really excited about. You know, we saw our de-levering in the first five months, a half turn, which I think is really excellent progress, and then the ability to bring more of this to the bottom line as we operate as a combined, more agile company.

Continuing progress early in the launches of Reillys and continuing to progress Zap soccer.

A flurry of activity at the end of the year initiating some mid and late stage trials, we're really excited about.

I you know you saw our delevering in the first five months of half turn which I think is really excellent progress.

And then the ability to bring more of this to the bottom line as we operate as a combined more agile company. So really excited about where we're headed.

So, I'm really excited about where we're headed, and you know what's in front of us for 2022. We look forward to speaking with many of you at the upcoming Jeffries London and Evercore Investor Conferences, and I'd just like to recognize all our Jazz colleagues for their efforts which have led to delivering these new therapeutic options to patients and to thank our partners and shareholders for their continued confidence and support. Thank everyone for joining us today. Stay well, everyone.

And you know what's in front of us for 2022.

We look forward to speaking with many of you at the upcoming Jefferies, London, and Evercore investor conferences, and I'd, just like to recognize all our jazz colleagues for their efforts, which have led to delivering these new therapeutic options to patients and to thank our partners and shareholders for their continued confidence and support and thank everyone for joining us today.

Stay well everyone.

Ladies and gentlemen, this concludes today's conference. Thank you for your participation and have a wonderful day. You may all disconnect.

Ladies and gentlemen. This concludes today's conference. Thank you for your participation and have a wonderful day you may all disconnect.