Q2 2022 Axsome Therapeutics Inc Earnings Call

Good morning, and welcome to Axsome Therapeutics conference call.

Good morning, and welcome to Axon Therapeutics Conference call.

Operator: I would now like to turn the conference over to your host, Mark Jacobson,

I would now like to turn the conference over to your host Mark Jacobson, Chief operating officer at Axon Therapeutics Mark. Please go ahead.

Operator: Chief Operating Officer at Axsome Therapeutics.

Okay.

Operator: Mark, please go ahead.

Thank you operator, good morning, and thank you all for joining us on today's conference call.

Mark Jacobson: Thank you, operator.

This morning, we issued our earnings press release, providing a corporate update and details of the company's financial results for the second quarter of 2022.

The release.

Also the wire a short time ago and is available on our website at axon dotcom.

Mark Jacobson: Good morning, and thank you all for joining us on today's conference call.

During today's call, we'll be making certain forward looking statements.

These statements May include statements regarding among other things the efficacy safety and intended utilization of our investigational agents.

Clinical and non clinical plans.

Our plans to present or report additional data.

Anticipated conduct and the source of future clinical trials regulatory plans future research and development plans commercial plans and possible intended to use of cash and investments.

These forward looking statements are based on current information assumptions and expectations that are subject to change and involve risks and uncertainties that may cause actual results to differ materially from those contained in the forward looking statements.

These and other risks are described in our periodic filings made with the Securities and Exchange Commission, including our quarterly and annual reports you are cautioned not to place undue reliance on these financials look forward looking statements, which are only made as of today's date and the company disclaims any obligation to update such statements joining me on the call today aren't doctor.

Area to Buteau, Chief Executive Officer, Nick PV, Chief Financial Officer, and Lori Inglebert Senior Vice President of commercial and business development.

Area will first provide an overview of the company and then review recent developments and upcoming milestones following area Laurie will provide a commercial update and then Nick will review our financial results. We will then open the line for questions questions will be taken in the order. They are received and with that I will turn the call over to Ariel.

Mark Jacobson: This morning, we issued our earnings press release providing a corporate update, and details of the company's financial results for the second quarter of 2022. The release crossed the wire a short time ago and is available on our website at Axsome.com.

Thank you Mark good morning, everyone and thank you all for joining axon Therapeutics second quarter 2022 financial results and business update conference call. We are proud to report our first commercial sales following the closing of the <unk> acquisition in the second quarter this transition to commercial status.

Mark Jacobson: During today's call, we will be making certain forward-looking statements. These statements may include statements regarding, among other things, the efficacy, safety, and intended utilization of our investigational agents, our clinical and non-clinical plans, our plans to present or report additional data, the anticipated conduct and the source of future clinical trials, regulatory plans, future research and development plans, commercial plans, and possible intended use of cash and investments. These forward-looking statements are based on current information, assumptions, and expectations that are subject to change and involve risks and uncertainties that may cause actual results to differ materially from those contained in the forward-looking statements. These and other risks are described in our periodic filings made with the Securities and Exchange Commission, including our quarterly and annual reports.

Mark Jacobson: You are cautioned not to place undue reliance on these forward-looking statements, which are only made as of today's date, and the company disclaims any obligation

Mark Jacobson: to update such statements.

As a milestone that few developmental stage companies reach and we are positioned to potentially rapidly grow our commercial portfolio in the near to intermediate term.

This should happen with the <unk>.

<unk> stage product candidates that we have as well as five additional phase III stage clinical programs I will provide an update on our commercial and developmental portfolio before turning it to Lori Wade commercial update it to Nick for the financial update.

Mark Jacobson: Joining me on the call today are Dr. Arie Otebuto, Chief Executive Officer, Nick Peasey, Chief Financial Officer, and Lori Engelbert, Senior Vice President of, Commercial and Business Development.

Ariel: Ariel will first provide an overview of the company and then review recent developments and upcoming milestones.

Starting with <unk>, we generated U S net sales of $8 8 million.

For the roughly two months from the close of the acquisition on May 9th to the end of the second quarter.

We continue to be excited by the growth potential for this product.

Moving on to our NDA speech products, except some five mbd, Andy access or <unk> for migraine.

With regards to our NDA for <unk> five in major depressive disorder or N V. D. We announced that we had incurred into labeling discussions with the FDA in late June .

We have been pleased with the progress of these discussions and based on the interactions we anticipate potential FDA action on the NDA in the third quarter and potentially as early as this month.

With regards to access those seven following the complete response letter we recently submitted for type a meeting with the FDA to discuss.

Our potential approach.

Our planned approach to the Resubmission of the NDA and we anticipate that this meeting will occur in the third quarter.

The rest of our development pipeline continues to progress.

The largest U.

Our old timers disease agitation program, we have amended the relaxed criteria for the phase III randomized withdrawal study are in excess of five in Alzheimers disease agitation.

<unk> was informed by results of an analysis requested by the FDA of data from our previously completed positive advance one trial.

In order to generate additional data to support the efficacy of in excess of five in this indication. We are also initiating a new randomized placebo controlled parallel group trial. The advanced two trial this quarter.

Concurrent with the initiation of advance too we are conducting we are concluding the accord randomized withdrawal trial, we expect topline results from this study in the fourth quarter of 2022.

Boy, It's a 12 hour product candidate being developed for the treatment of narcolepsy enrollment in a symphony phase III trial is progressing and top line results are anticipated in the first half of 'twenty three.

Cause 14, our product candidate for the treatment of fibromyalgia manufacturing and other activities related to the planned submission to the planned submission of the NDA are ongoing and we expect to submit the NDA for this product in 2023.

With regards to a new indication for <unk>, We recently announced our plans to develop psoriatic at all for the treatment of ADHD.

We anticipate initiating a pivotal trial, so enthralled in adults with ADHD and the fourth quarter.

Lori: Following Ariel, Lori will provide a commercial update and then Nick will review our financial results.

I will now turn the call over to Laurie who will provide commercial update.

Nick: We will then open the line for questions. Questions will be taken in the order they are received.

Thank you Eric and good morning.

Mark Jacobson: And with that,

The U S portion of the Sanofi acquisition from Jazz Pharmaceuticals was completed on May nine and as previously reported the transition was seamless with no disruption to patient.

Mark Jacobson: I will turn the call over to Ariel.

Ariel: Thank you, Mark.

We are extremely proud of the efforts made by the team.

Such a short amount of time to achieve this significant milestone for Exxon.

Ariel: Good morning, everyone, and thank you all for joining Axiom Therapeutics' second quarter 2022 financial results and business update conference call.

At the time of completing the acquisition ask them from base approximately 75 employees from jazz.

Which the majority of our sales reps.

Ariel: We are proud to report our first commercial sales following the closing of the Synosy acquisition in the second quarter.

Axons digital centric commercialization platform plays a significant role in our commercial strategy first thing I see and is already enabling highly productive sales force.

Ariel: This transition to commercial status is a milestone that few developmental stage companies reach, and we are positioned to potentially rapidly grow our commercial portfolio in the near to intermediate term.

Ariel: This should happen with the two NDA stage product candidates that we have as well as five additional phase three stage clinical programs.

Ariel: I will provide an update on our commercial and developmental portfolio before turning it to Lori for a commercial update and to Nick for the financial update. Starting with Synosy, we generated U.S. net sales of $8.8 million for roughly two months from the close of the acquisition on May 9th to the end of the second quarter.

Ariel: We continue to be excited by the growth potential for this product.

Ariel: Moving on to our NDA stage products, AXS 05 for MVD and AXS 07 for

unknown: Mike.

The Sanofi deal was announced on March 28 in the U F. Fortunately was completed on May 9th.

As such Q2 had the potential to be a highly disruptive quarter.

However, new prescription volume during this period was maintained and total prescription volume grew 7% quarter over quarter, reflecting effective execution and underlying strength of the soon as he doesn't.

Okay.

A portion of the close is scheduled to occur in the second half of the year.

As a reminder, sanofi as the first and only FDA approved dual acting DNR Rai to treat excessive daytime sleepiness or eds in adults with narcolepsy or OSA.

We believe that the clinical benefits of some nasty provide meaningful differentiation in the marketplace for both OSA and narcolepsy patients who are suffering from UBS.

Currently the nursing has a 2% patient share in drug treated OSA patients and a 7% patient share in drug treated narcolepsy patients.

The opportunity for growth remains substantial and I look forward to communicating the results of actions first full quarter with Sanofi during our Q3 earnings call.

Regarding excess by five launch preparations the team remains focused in anticipation of a potential launch.

We have incorporated learnings from commercializing, so nursing, including utilizing our DTC platform and are prepared and ready to commercialize if approved.

I will now turn it over to Nick who will review the financials.

Ariel: With regards to our NDA for AXS 05 and Major Depressive Disorder, or MVD, we announced, that we had entered into labeling discussions with the FDA in late June. We have been pleased with the progress of these discussions, and based on the interactions, we anticipate potential FDA action on the NDA in the third quarter, and potentially as early as this month.

Thank you Lori and good morning, everyone. Today, I will discuss our second quarter results and provide some financial guidance. We ended the quarter with approximately $73 4 million in cash compared to roughly $86 4 million at the end of the previous quarter.

Ariel: With regards to AXS 07, following the complete response letter, we recently submitted for, a type A meeting with the FDA to discuss our potential approach, our planned approach to the resubmission of the NDA, and we anticipate that this meeting will occur in the third quarter.

Ariel: The rest of our developmental pipeline continues to progress.

Ariel: With regards to our Alzheimer's disease education program, we have amended the relapse criteria, for the ACCORD Phase 3 randomized withdrawal study of AXS 05 in Alzheimer's disease education. This change was informed by results of an analysis requested by the FDA of data from, the previously completed positive ADVANCE 1 trial.

Ariel: In order to generate additional data to support the efficacy of AXS 05 in this indication, we are also initiating a new randomized placebo-controlled parallel group trial, the ADVANCE 2 trial, this quarter.

Ariel: Concurrent with the initiation of ADVANCE 2, we are concluding the ACCORD randomized, withdrawal trial, and we expect top-line results from this study in the fourth quarter of 2022.

Ariel: For AXS 012, our product candidate being developed for the treatment of narcolepsy, enrollment, in the Symphony Phase 3 trial is progressing, and top-line results are anticipated in the first half of 2023.

Ariel: For AXS 014, our product candidate for the treatment of fibromyalgia, manufacturing, and other activities related to the planned resubmission, to the planned submission of the NDA are ongoing. And we expect to submit the NDA for this product in 2023.

Ariel: With regards to a new indication for CINOZI, we recently announced our plans to develop, sorority amphetol for the treatment of ADHD.

Lori: I will now turn the call over to Lori, who will provide commercial updates.

During and subsequent to Q2, we accessed our existing ATM facility, receiving net proceeds of approximately $41 $8 million, resulting in a pro forma cash balance of $102 million.

Ariel: We anticipate initiating a pivotal trial of sorority amphetol in adults with ADHD in the, fourth quarter.

Moving to the P&L sono seating net sales for the quarter in the United States was $8 $8 million as a reminder, the completion of the acquisition of Sanofi for the U S. Territory was completed on May 9th and the $8 8 million in net sales relates to the time period of May 9th through June 30th.

R&D expenses were $15 8 million for the three months ended June 32022, and $14 5 million for the comparable period in 2021.

The increase was driven by personnel expense and costs associated with ongoing clinical trials.

SG&A expenses were $31 2 million for the three months ended June 32022, and $16 3 million for the comparable period in 2021 the.

The increase was primarily related to commercial activities for Sanofi pre commercial activities for our late stage pipeline assets and personnel expense along with an increase in noncash stock compensation expense.

Net loss was 41 4 million or $1.06 per share for the three months ended June 32022, compared to a net loss of $32 3 million or <unk> 86 per share for the comparable period in 2021.

The net loss for the current period included $10 2 million of non cash stock compensation expense compared to $5 5 million in the comparable period.

Regarding the Sanofi acquisition, the preliminary preliminary accounting of the acquisition of Sanofi is included in our Q2 2022 financial statements.

To date, we have performed a preliminary fair value analysis of the business combination.

The final determination of these fair values will be completed as soon as possible, but no later than one year from the acquisition date.

We believe that our current cash balance along with the remaining committed capital from the $300 million term loan facility with Hercules capital is sufficient to fund anticipated operations into 2024 based on our current operating plan, which includes the commercialization of Sanofi and the potential launch of <unk>.

Access of five and M D J.

Route along with continued development of our pipeline.

That concludes our second quarter 2022 financial review I will now turn the call back to Mark to lead the Q&A discussion.

Thank you Nick operator May we please have our first question.

Thank you.

At this time, we will be conducting a question and answer session. If you'd like to ask a question. Please press star one on your telephone keypad.

A confirmation tone will indicate your line is in the question queue.

You May press star two if you'd like to remove your question from the Q.

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

As a reminder, you may submit questions via the web by using the ask a question feature on the side of your screen.

Our first question comes from the line of Charles Duncan with Cantor Fitzgerald. Your line is now open.

Lori: Thank you, Ariel, and good morning.

Good morning, Arie O N team yeah, congrats on the progress with Sono see this quarter and thanks for taking our questions.

I wanted to ask you about Sanofi, but I need to ask you about our access so five because I'm I'm kind of wondering what's taken so long, but first of all before I get get to that regarding access so far but I guess I'm wonder if there are any terms within the Hercules facility that you can.

Talk about and suggested that is negotiable should should the you know call it black Swan happening and there's a C or all of that is granted.

We're giving them for access so five can you renegotiate that that term loan and therefore access to capital.

Lori: The U.S. portion of the CINOZI acquisition from Jazz Pharmaceuticals was completed on, May 9th, and as previously reported, the transition was seamless, with no disruption to patients.

Lori: We are extremely proud of the efforts made by the team in such a short amount of time, to achieve this significant milestone for Axum.

Lori: At the time of completing the acquisition, Axum conveyed approximately 75 employees from, Jazz, of which the majority were sales reps. Axum's digital-centric commercialization platform plays a significant role in our commercial, strategy for CINOZI and is already enabling a highly productive sales force.

Lori: The CINOZI deal was announced on March 28th, and the U.S. portion was completed on May, 9th. As such, Q2 had the potential to be a highly disruptive quarter.

Lori: However, new prescription volume during this period was maintained, and total prescription, volume grew 7% quarter over quarter, reflecting effective execution and underlying strength of the CINOZI business.

Hey, Charles Thanks for the question with.

Lori: The EU portion of the close is scheduled to occur in the second half of the year.

With regards to the term loan facility for Hercules as you know, it's a $300 million facility and what's interesting with the Sanofi acquisition is that.

Lori: As a reminder, CENOSI is the first and only FDA-approved, dual-acting DNRI to treat excessive, daytime sleepiness, or EDS, in adults with narcolepsy, or OSA.

Lori: We believe that the clinical benefits of CENOSI provide meaningful differentiation in the, marketplace for both OSA and narcolepsy patients who are suffering from EDS. Currently, CENOSI has a 2% patient share in drug-treated OSA patients and a 7% patient, share in drug-treated narcolepsy patients.

Lori: The opportunity for growth remains substantial, and I look forward to communicating the results, of Axsome's first full quarter with CENOSI during our Q3 earnings call.

Some of those tranches will actually your sales based company sales based so so we'd still potentially have access to some of the additional tranches.

And in addition, there was a significant proportion of.

The loan facility, which is at the discretion of Hercules.

Now our financial guidance, you know it doesn't cooperate all those scenarios, so I'll turn it to Nick to provide more color but.

The black Swan of that that you're referring to and you know and I will say that oh with regards to that.

To that characterization I think it is accurate we would be where we're very confident in.

Lori: Following AXS05 launch preparations, the team remains focused in anticipation of a, potential launch.

The package that they can put together for an excess of five in terms of the efficacy.

Lori: We have incorporated learnings from commercializing CENOSI, including utilizing our DCC platform, and are prepared and ready to commercialize if approved.

And safety however.

Do planning for all scenarios and we'll be ready for that.

But in the case that that that happens.

And a lot of the spend which currently modeled for the launch of an excess of five.

So that would naturally go away and therefore reduced our operating cash needs.

Nick: I will now turn it over to Nick, who will review the financials.

But I'll turn it over to Nick to.

Nick: Thank you, Lori, and good morning, everyone.

I think earlier you commented on the majority of it.

Nick: Today I will discuss our second quarter results and provide some financial guidance. We ended the quarter with approximately $73.4 million in cash, compared to roughly $86.4, million at the end of the previous quarter. During and subsequent to Q2, we accessed our existing ATM facility, receiving net proceeds, of approximately $41.8 million, resulting in a pro forma cash balance of $102 million.

Nick: Moving to the P&L, CENOSI net sales for the quarter in the United States was $8.8 million.

Nick: As a reminder, the completion of the acquisition of CENOSI for the U.S. Territory was completed, on May 9th, and the $8.8 million in net sales relates to the time period of May 9th through, June 30th.

Nick: R&D expenses were $15.8 million for the three months ended June 30th, 2022, and $14.5 million, for the comparable period in 2021. The increase was driven by personnel expense and costs associated with ongoing clinical, trials.

Just to give based on everybody that there's 100 million is available upon our 100 billion is tied to the excess Oh five approval.

Nick: SG&A expenses were $31.2 million for the three months ended June 30th, 2022, and $16.3 million, for the comparable period in 2021. The increase was primarily related to commercial activities for CENOSI, pre-commercial activities, for our late-stage pipeline assets, and personnel expense, along with an increase in non-cash stock compensation expense.

Nick: Net loss was $41.4 million, or $1.06 per share, for the three months ended June 30th, 2022, compared to a net loss of $32.3 million, or $0.86 per share, for the comparable period in 2021. The net loss for the current period included $10.2 million of non-cash stock compensation, expense, compared to $5.5 million in the comparable period.

Nick: Regarding the CENOSI acquisition, the preliminary accounting of the acquisition of CENOSI is, included in our Q2 2022 financial statement. To date, we have performed a preliminary fair value analysis of the business combination. The final determination of these fair values will be completed as soon as possible, but, no later than one year from the acquisition date.

Actually theres another tranche of $50 million tranche that is tied to the sales.

Based performance tranches area stated.

It's a measure of that is the trailing three months.

So that would still be available to us in the black Swan event that you're referring to trials and just to restate what area are mentioned as well in the event of of H C. R. L. R. R. Obviously, our spend will decrease as Youre aware theres significant launch spend.

That would be required.

Wired for access so five.

That spend will go away and obviously, we would not have access to the $100 million tranche right away. However.

Nick: We believe that our current cash balance, along with the remaining committed capital, from the $300 million term loan facility with Hercules Capital, is sufficient to fund anticipated operations into 2024, based on our current operating plan, which includes the commercialization of CENOSI and the potential launch of AXS05 in MDD, if approved, along with continued development of our pipeline.

However, we still believe our cash runway would take us into 2024.

Nick: That concludes our second quarter 2022 financial review.

Okay, and I'm generally not a black Swan Guy so forgetting about that event you know considering they the alternative which is excess so five is approved here in the near term.

Would you be able to launch it within a reasonable period of time, let's say by the end of this year or early next year and then could you give us a sense of how many of the reps that are currently marketing. So no C would would have overlap and be able to mark.

<unk> access so five as well.

Yeah, I think I wasn't.

Question for Lori.

Mark Jacobson: I will now turn the call back to Mark to lead the Q&A discussion.

Hey, Charles Thanks.

Thanks for the questions. So we you know we will provide guidance upon potential approval that we'll watch within a quarter of approval.

Mark Jacobson: Thank you, Nick.

Operator: Operator, may we please have our first question?

Operator: Thank you.

And regarding the rats so.

Operator: At this time, we will be conducting a question and answer session.

Right now we currently have and are aligned to 75 territories person I've seen 75 reps are covering about 12000, Hcp's, who are our high potential prescribers for both.

Both OSA and narcolepsy.

Patients, who are who are suffering with ETF due to those conditions.

I'm pretty.

Adamant about keeping ourselves four separate had launched or that access of five salesforce can can focus on and you know really really drive the adoption.

Of the product at launch, but there is high overlap and a lot of synergy and as we've mentioned before and as you are alluding to.

So when the time is right we will start overlapping.

Consider overlapping the two sales forces in terms of call point, but.

But I really want to keep everyone focused are really want to turn you know continue to drive some nice T cells up them, but our focus sales force and the same for access.

Last quick question on Alzheimer's agitation regarding potential data yet this year can you give us a sense of the number of patients that might be included in that and will it be a milestone analysis a set of data I look at data at a certain time point area.

What would what would really drive that additional data that you you could presented later on this year. Thanks.

So.

With regards to to the milestone analysis remember this is a randomized withdrawal study soon so it's not.

It would not be it would not be milestone.

Driven from the perspective of a time point, when we will actually look at.

The difference in relapsed rates, all the time to relapse between the two groups.

Because of <unk>.

And placebo.

For the number of patients who will be in that analysis, we will disclose that at the time that we announce the results.

Thanks for the reminder, aerial but would.

Can you give us a sense of what percentage of your patients who'd like to include in that.

Without actual numbers.

All in all the patients and once you launch it.

It.

Okay. Thanks for taking the questions will fall off.

Yes.

Operator: If you'd like to ask a question, please press star 1 on your telephone keypad.

Our next question is from Marc Goodman with S V. B Securities. Your line is open.

Operator: A confirmation tone will indicate your line is in the question queue.

Operator: You may press star 2 if you'd like to remove your question from the queue.

Operator: For participants using speaker equipment, it may be necessary to pick up your handset, before pressing the star keys.

Okay.

Hi, Thanks for taking my questions as Judy on the line from Mark.

I have couple of question for XO Fi. So first wanted to ask about the N V in depression.

Since I'm wondering how much back and forth and therapy.

On the proposed label, enabling on the post marketing proposal discussions have been ongoing for six weeks and three months respectively.

It typically takes two to four weeks.

Specifically what are the Fda's continued issues and pushed back or now with the application and enable.

Yeah.

Okay.

So.

The guideline of.

Four to six weeks that you provided for labeling discussions I think maybe that's an average and I'm not I know that that's typically.

What folks state. However, you know we don't have any control over the FTC's process.

Part of it.

Role, which is to make sure that we're responsive and.

And collaborative that will get done.

I said you know, we're very pleased with the way that the negotiations have been ongoing have.

I have been going thus far.

And we look forward to an FDA action in the near term.

Can I have one follow up here really you'd asked about the post marketing commitments and requirements and and those ongoing for three months.

Those are or.

Not on going we previously mentioned we reached agreement on the PMC than P. Myers with FDA. So so just just to separate those two that I just wanted to clarify that.

And this is mark by the way.

Yep got it clarify.

A follow up or Alzheimers agitation it sounds like we're starting another pivotal trial once too.

Did the FDA, where that study is that trial required for filing and can provide more color on the timeline for that trial. Thank you.

Okay.

So starting that trial.

It reflects our desire to make sure that we have a strong as possible of a data package when we submit the NDA for all time this disease agitation.

No product has been approved yet for this indication. So we can do is make sure that we incorporate learnings.

Where we can get them because you know there has been.

Recent FDA action and one.

When a competitor product in another northern Haynesville symptom Alzheimers disease.

Psychosis, so we watch that very carefully and try to incorporate any learnings there into our clinical program. So we want to make sure that so while this new study technically would not be required for.

For an NDA filing in old timers disease agitation, assuming that a randomized withdrawal study where I would say is positive.

We think that it's it's prudent to have.

More than one shot on goal and to have two studies both of which are parallel group that would replicate each other.

So let's say the core studies talk to you then we're going to file we won't wait for a boss too right.

So assuming that that we have a data package that we think is adequate.

We would then do is have a pre NDA meeting with the FDA and after that meeting would be to tell you.

Whether or not you have to.

He.

Believes that a.

But that we should go ahead and file.

Operator: As a reminder, you may submit questions via the web by using the ask a question feature, on the side of your screen.

Got it that's very helpful. Thank you.

Operator: Our first question comes from the line of Charles Duncan with Cantor Fitzgerald.

Okay.

Our next question is from Joon Lee with true Securities. Your line is now open.

Good morning. This is awesome offering joon thanks for taking the questions. Our first question is given known drug drug interaction with people Cry on do you think patient currently on antidepressants will need to be washed out of an existing drug before and it can be an access O I's.

And how do you envision patients on standard antidepressants could be transitioned to the excess of bites and I have a follow up.

Thank you for the question drug drug interactions.

Not unique to cause so five it's just that.

We are.

Leveraging particular drug drug interaction to improve the pharmacokinetics of the NMDA receptor antagonism of access so far however.

A lot of drugs do have drug drug interactions.

And they are sections are in every and every package insert with regards to those drug drug interactions advisory commissions, how to navigate that and it's something that clinicians are able to do.

Other antidepressants also have drug drug interactions and and it is typical to them too.

Make sure that the patients are washed out of one treatment before putting them onto another treatment. This is something that clinicians psychiatrist in particular are very familiar with.

Okay. Thank you for that and then just on the labeling discussions for all five have you had any more interaction with the FDA. Since you first disclosed labeling discussions and if so where items such as Iran's part of that discussion.

We have had additional interactions as we mentioned we've been in labeling discussions with the FDA.

And with regards to other aspects of what has been what has been discussed.

As part of those negotiations, we will not comment on that as you can as you can imagine.

It would be inappropriate at this stage.

Okay. Thank you.

Our next question comes from your teams in Asia with Guggenheim Partners. Your line is now open.

Charles Duncan: Your line is now open.

Charles Duncan: Good morning, Ariel and team.

Charles Duncan: Yeah, congrats on the progress with CENOSI this quarter, and thanks for taking our questions.

Oh, Hey, guys. Thank you for taking my question two for me could you give us a little bit more color on us and North Sea launch in terms of how should we think about the performance in Q3 are you in a position to provide some sort of a guidance.

Charles Duncan: I wanted to ask you about CENOSI, but I need to ask you about AXS05, because I'm kind of, wondering what's taking so long.

Charles Duncan: But first of all, before I get to that, regarding AXS05, I guess I wonder if there are any terms, within the Hercules facility that you can talk about and suggest that that is negotiable should the, you know, call it black swan happen, and there's a CRL that is granted or given for AXS05.

Going forward and at what point, you might be able to provide that so that's one and then the other question I have is on the abuse liability for all five could you just talk about the B E that you're comfortable with your with the lack of abuse liability.

They are but if you read the guidance for CNS drugs definitely to quash them to prevent abuse liability was that just trying to get some sense there. Thanks.

Yeah, So I'll Hum.

Answer the.

Liability question.

You are correct that all CNS active drugs are required to.

Assess the potential of those drugs for for abuse.

Liability.

However, you know how that's done really depends on the.

The compound.

And inks signals have been seen.

Clinical trials.

So as part of our NDA.

I'd have to do that assessment and as we've said in the past.

That has been done.

And I'll turn it over to.

So to make them more of you to answer your questions regarding smoking.

So I'll I'll quickly just kind of give you some data points that help give some color around you know performance.

Performance so far.

Yeah from the since the acquisition and then I'll pass it over to Nick in terms of guidance. It looks like you know we are you know we're still very much learning in assessing the market post the transaction.

And as I mentioned earlier, we've aligned to 75 territories and reps that are that are currently out promoting now are really incredibly high caliber.

Sales force them and they are generating productivity levels of sales forces, one and a half to two times the size.

That they are right now we believe that a lot of that has to do with you know the underlying momentum.

Momentum from Sanofi, as well as being able to effectively execute through D. C C.

So really proud of what the team was able to do in terms of you know potentially facing a very disruptive quarter and as I mentioned in the prepared remarks, you know quarter over quarter growth was 7%.

Which which really right and you know really is impressive given given what could have happened during a highly disruptive quarter.

Charles Duncan: Can you renegotiate that term loan and therefore access the capital?

I suffered an XR guidance, yes.

Thanks Laurie.

The quarter as Lori mentioned earlier it could have been extremely disruptive as we stated in the opening remarks, we had $8 8 million in net sales that was actually 22% year over year growth in scripts.

So highly satisfied with how the transition has taken taken place so far as a reminder, on our sono.

Ariel: Hey, Charles, thanks for the question.

Sanofi webcast that we had.

Just a couple of months ago, we believe the eds marketed in OSA and narcolepsy has the potential to have peak sales in the $3 million to $500 million range at this point we're not.

Would it be able to give guidance for the rest of the year as we are still learning.

But.

Obviously very positive transition thus far.

Okay.

Ariel: With regards to the term loan facility for Hercules, as you know, it's a $300 million, facility, and what's interesting with the CENOSI acquisition is that some of those tranches are actually just sales-based, company sales-based.

Okay.

Thank you. Our next question comes from Jason Goldberg with Bank of America. Your line is now open.

Ariel: So we still potentially have access to some of the additional tranches, and in addition, there is a significant proportion of the loan facility, which is at the discretion of Hercules.

Oh, Hey, guys. Thanks for taking my questions.

Ariel: Now, our financial guidance, you know, does incorporate all those scenarios.

Ariel: So I'll turn it to Nick to provide more color, but in the black swan event that you're referring, the package that we put together for AXS 05 in terms of the efficacy and safety.

Ariel: However, we do plan for all scenarios, and we'll be ready for that.

Yeah, I just wanted to come back to the cash question I'm, a little confused so it seems like.

Nick: But in the case that that happens, then a lot of the spend, which currently we've modeled for the launch of AXS 05, that would naturally go away and therefore reduce our operating cash needs.

Like we're at a point, where some sort of Sanofi sales threshold, maybe trigger more access to the Hercules facility.

So just trying to understand I think you.

You're burning like 40 million a quarter with the Sanofi fully kind of in the numbers going forward that would seem like that's going up so.

You know absent the excess of five approval just trying to understand how you kind of worked through the end of the year on the existing cash dynamics and then on the 80 agitation update.

I'm just curious why not start the.

The new trial sometime in fourth quarter. After the randomized withdrawal update presuming it that randomized withdrawal study update to facilitate approval and the cash is dire or deere for you guys why not wait to see if that could facilitate approval before starting another study. Thanks.

Yeah, so related too.

Related to the Sanofi comment so I guess is maybe a little bit of background on Sanofi.

The guidance that we previously stated and you know feel feel comfortable at this stage is that we do expect a small loss in the stub period this year Jason.

And then for Sanofi to actually be accretive next year.

And based on the performance for Q2.

Pretty excited about that additionally, as it relates to as it relates to Hercules and the tranche.

With the debt that we've taken down and our trailing three months sales are anticipated to trailing three months sales were actually up.

Approaching a where we would be able to utilize.

Nick: But I'll turn it over to Nick to comment.

The tranche for a $50 million so access to the Hercules facility would be available.

Potentially potentially next year.

I'll turn it over to Ariel to answer the other question.

Nick: Yeah, I think, Ario, you commented on the majority of it.

And actually one last question one other comment that you made related to burn.

Burn I think you had mentioned somewhere around $40 million. Our average four months cash burn has actually been closer to $30 million.

So I just wanted to clarify that.

Nick: Just to give baseline to everybody, 100 million is available upon, or 100 million is tied to the AXS 05 approval. Additionally, there's another tranche, $50 million tranche that is tied to the sales-based performance tranche, as Ario stated.

Okay.

And then.

With regards to the question around the start of the Alzheimers disease agitation trial.

Nick: And it's a measure of that's trailing three months.

Nick: So that would still be available to us, in the Black Swan event that you're referring to, Charles.

We are what we want to make sure that that we do as a <unk>.

<unk>, our our history the way, we do things of rapidly developing our product candidates and so it makes sense for us to start that study.

Nick: And just to restate what Ario mentioned as well, in the event of a CRL, obviously our spend will decrease.

Sooner rather than later, so we made the determination and.

Nick: As you're aware, there's significant launch spend, that would be required for AXS 05.

I guess, what we're on track to start that study actually this quarter. So we're very proud of that and in terms of.

Nick: That spend would go away, and obviously we would not have access to the $100 million tranche right away. However, we still believe our cash runaway, would take us into 2024.

Charles Duncan: Okay, and I'm generally not a Black Swan guy, so forgetting about that event, considering the alternative, which is AXS 05 is approved here in the near term, would you be able to launch it within a reasonable period of time, let's say by the end of this year or early next year?

Charles Duncan: And then could you give us a sense, of how many of the reps that are currently marketing CENOSI would have overlap and be able to market AXS 05 as well?

Lori: Yeah, I think those are questions for Lori.

Waiting until it's over.

The fourth quarter.

Remember the study that we are launching which is.

Lori: Hey, Charles, thanks for the questions.

A parallel group trial, we have a lot of information to guide us to.

To the design of that study and this will be essentially a repeat of our positive advance one trial.

Lori: So we will provide guidance upon potential approval, that will launch within a quarter of approval.

Lori: And regarding the reps, so right now we currently have and are aligned to 75 territories for CENOSI.

Lori: But there is high overlap and a lot of synergy, as we've mentioned before and as you're alluding to.

Lori: Those 75 reps are covering about 12,000 HTPs, who are high potential prescribers for both OSA and narcolepsy in patients who are suffering with EDS due to those conditions.

Lori: I am pretty adamant, about keeping our sales force separate at launch so that AXS 05 sales force can focus and really drive the adoption of the product at launch.

Lori: So when the time is right, we will start overlapping, consider overlapping the two sales forces in terms of call points.

Lori: But I really wanna keep everyone focused, really wanna turn, continue to drive CENOSI sales up with a focused sales force and the same for AXS.

We'll take the learnings from that.

It will allow us to make sure that we are.

Tweet where needed.

The design of the current study.

The next day.

Got it okay. Thanks.

Charles Duncan: Last quick question on Alzheimer's agitation regarding potential data yet this year.

Yes.

Yeah.

Our next question comes from Ron sell larger with H C. Wainwright. Your line is now open.

Charles Duncan: Can you give us a sense of the number of patients that might be included in that?

Ariel: And will it be a milestone analysis, say, you know, a look at data at a certain time, point?

Ariel: Or what would really drive that additional data that you could present later on this, year?

Hi, This is Bob Allen dialing in for Ron for Rajiv and thanks for taking my question. So.

Ariel: So, with regards to the milestone analysis, remember, this is a randomized withdrawal, study.

Ariel: So, it's not, it would not be milestone driven from the perspective of a time point.

So we have a couple of questions. So firstly.

Is there anything that you could provide with respect to that.

Hi.

Kind of a competitive advantage versus other anti depression in the later clinical.

They just have development.

Yeah well.

I think first of all it's important to keep.

Compare.

It's a sulfide our data in excess of five two.

It's important to compare that to actual phase III data with other product candidates. So to the extent that our other product candidates have not generated that data it's hard for us to.

To comment what we can speak about is the clinical profile of access so five that we've demonstrated now in four different clinical trials.

Ariel: So, we will actually look at the difference in relapse rates or the time to relapse between, the two groups, AXS05 and placebo.

Ariel: For the number of patients who will be in that analysis, we will disclose that at the, time that we announce the results.

At least and and <unk>.

And.

Also with long term data that goes out to one year, whatever we see what we've seen is that.

Charles Duncan: Thanks for the reminder, Ariel.

Ariel: But can you give us a sense of what percentage of patients you'd like to include in that?

There was a rapid and tight depressant effect, which.

Remember was highly statistically significant in week, one with the Gemini trial.

Ariel: I mean, without actual numbers.

Ariel: Oh, you know, all the patients who are randomized included.

That was accompanied not just by <unk>.

Simpson and prudent but also by an improvement in quality of life was physically significant at week. One so the drug is making patients feel better, but it's also a healthy function better.

Ariel: Okay.

Charles Duncan: Thanks for taking the questions.

Charles Duncan: We'll follow up.

Charles Duncan: Sure.

Better very rapidly.

Operator: Our next question is from Mark Goodman with SVB Securities.

That's not been seen before.

And or anti depressant.

Operator: Your line is open.

Secondly, the.

But the magnitude of the fact is is very large.

With the excess.

Five.

And and it's so the b.

Mark Goodman: Hi.

The treatment difference increases over time.

With access with <unk>.

It's also.

Important to look at our admission data.

Where.

There was more than two fold increase in remission.

At week, six past compared to placebo in that study.

So you have a drug that works incredibly well.

Objectively.

With regards to magnitude of effect.

It has a rapid onset and also which is durable.

And then lastly, the garage was incredibly well tolerated.

From our perspective.

Remember this is.

A novel mechanism of action. So it's nice to have a novel mechanism of action, but when that new mechanism of action actually translates to clinical benefit.

And then really tells commissions paid there's something new.

That.

That should be considered in trying to treat patients.

Who are not responding to current treatments and.

As a reminder, as a percentage of patients who don't respond well to current treatments.

<unk> is nearly.

Nearly 70%.

Yeah.

Mark Goodman: Thanks for taking my questions.

Thanks for the detailed color so with respect to ex.

Rudy: This is Rudy on the line for Mark.

Ex U S commercialization activities what are your updated thoughts on this and how do you plan to optimize the value of your assets.

Rudy: I have a couple questions for AXS05.

So it's always been our stated corporate objective to out license our product candidates.

For ex U S markets, while we focus on the U S.

With its nosey acquisition. So we have now become a global.

Biopharmaceutical company.

And they are sales I assume that was the ex U S which are growing.

We did.

Did not comment on that portion of the business. This quarter, because we have not yet closed on the ex U S portion of the acquisition.

That may.

Inform our strategy going forward whether that news.

Business development ex U S.

Sure.

Or in other tack now that we actually do have some infrastructure ex U S.

Rudy: So, first, I want to ask about the MD and depression.

Great. One final question from me, so youre stepping into a DST as you May know this is a decently crowded indication. So just like to hear your thoughts you know what's your value proposition here and what are some of the unmet need that you're planning to I guess, it's M C.

Rudy: I'm just wondering how much back and forth has been there being on the proposed label?

Rudy: Is labeling on the post-marketing proposal discussions have been ongoing for six weeks, and more than three months, respectively?

Rudy: I mean, this typically takes two to four weeks.

Rudy: So, specifically, what are the FDA's continued issues and pushback for now with the application, and the label?

So we are.

Okay.

We are very excited by the clinical profile.

So nosy.

As it relates to a potential potentially.

Rudy: So the guideline of four to six weeks that you provided for labeling discussions, I think, maybe that's an average.

Potentially.

Effective ADHD. However, we want to make sure that we don't jump the gun here, we want to run the clinical trial.

Rudy: And I know that that's typically what folks state.

Rudy: However, you know, we don't have any control over the FDA's process.

Rudy: The part of it that we can control, which is to make sure that we're responsive and, collaborative, that we have done.

And to see what the results are.

In terms of what the value proposition is there was a lot of unmet need in ADHD.

As you know most of the drugs that are currently available are highly scheduled drugs.

And the ones that are not highly scheduled do not have.

A large treatment effect. So I'm. So I think there is value here potentially with with.

So nosy should result in ADHD.

The results in EES and what I mean by that is if you look at the results for synovus.

Yes, the treatment effect is very large in fact, it's larger than other wake promoting agents.

And so you have this large effect size.

Hoping that are that we might see that in the U S D trial.

And we're looking forward to initiating that study in the fourth quarter.

Thanks, Thanks for taking our questions.

Our next question is from Joseph Thome with Cowen. Your line is now open.

Hi, there good morning, and thank you for taking my questions first.

First one on the the Depression review and then I'll follow up on the Alzheimers agitation, but on the current review I know you mentioned that you're encouraged with the progress of the labeling discussions maybe can you provide us a little bit of context on kind of whats inspiring that encouragement are you currently waiting for the FDA or are they waiting for analysis or any.

Data from you and your last part on this what would constitute sort of disclose the bowl released two investors from the review is the next thing we're going to hear a decision or is there any potential.

Kind of intermediate steps before that point.

Rudy: As I said, you know, we're very pleased with the way that the negotiations have been ongoing, have been going thus far.

So.

We said that we've been pleased with the progress.

Those negotiations I think one we're pleased that we did in terms of labor negotiations.

And we're pleased because.

There has been interactions with the FDA with regards to the label that is progressing so.

Rudy: And, you know, we look forward to an FDA action in the near term.

We.

The next disclosure next disclose them all of that we anticipate would be enough for your action.

Rudy: Okay.

Rudy: Can I have one follow-up here?

Rudy: Rudy, you had asked about the post-marketing commitments and requirements and those ongoing, for three months.

Okay, perfect and then on the Alzheimers disease agitation in the PR. It does mention that you amended the relapsed criteria for the the accord study are you able to give us a little bit of context as to how that changed and then with the parallel control group trial, but this is something that the FDA has some.

Adjusted or something that that you and the team thought would be helpful. There on what the profile. Thank you.

Yes, it's something that we thought would be helpful. In the context of.

Looking at the experience with the.

The development of drugs in.

In neighbouring indications in old timers disease and.

With regards to the.

Relaxed criteria question.

We were able to do them at the suggestions from the FDA was to look at the results for the advanced trial, which were positive.

And there was a lot of data to mine, there and particularly.

Looking at them.

B, how how one would look at a critical clinical meaningfulness with the various scales and so that informed.

The change in the relaxed criteria, so that fear they are consistent with the results of the advance one trial.

Okay. Thank you very much.

Rudy: Those are not ongoing.

Yeah.

Our next question is from Craig's juveniles with Mizuho Securities. Please proceed with your question.

Rudy: We previously mentioned we reached agreement on the PMCs and PMRs with FDA.

Rudy: So just to separate those two, I just wanted to clarify that.

Thank you very much and good morning. Thank you for taking my questions I, because I'm relatively new to the name just on excess <unk> 12 for narcolepsy can you just remind me what the T. P. P is and how you expect to position that relative to Sanofi and then a separate on.

Mark: And this is Mark, by the way.

Mark: Thanks for clarifying.

C N N a D. H D could you just remind me what the dosing is a especially relative to that in P. D. S. S in OSA and narcolepsy and it's if it's different is there a potential for an alternative prescription branding strategy. Thanks.

Okay.

I think thanks for those questions with regard to <unk> 12 in our concert trial.

We demonstrated that as.

It's 12, you don't have a profound effect on cataplexy, but not just that but also excessive daytime sleepiness.

And the other measure that was interesting in that study was cognition. We showed that there was a rapid improvement in cognition. So what.

For those reasons I excess 12 has very interesting TTP.

With regards to comparing it to the smelting.

As a reminder, she knows the wilds, who knows he is approved.

<unk> to treat patients with narcolepsy if approved for.

Patients for the treatment of eds in patients with narcolepsy. So there is no.

It does not have an effect on cataplexy. So that's the diff.

A difference between the two.

And.

With regards to the dosing of us so nosy.

ADHD and we have not disclosed the dose that we are going to be studying in the phase III trial, but we look forward to disc.

Disclosing that once we announced the initiation of that study.

Rudy: I have a follow up for Alzheimer's education.

Thank you.

Rudy: It sounds like we're starting another pivotal trial at once too.

Rudy: Did the FDA ask for that study?

Our next question is from Chris Howerton with Jefferies. Your line is now open.

Rudy: Is that trial required for filing?

Rudy: And can you provide more color on the timeline for that trial?

Rudy: Thank you.

Great and lots of great questions. So far thanks, so much for taking some for me two for me one first on the old five with.

With respect to the potential labeling approval what are the company's thoughts around the likelihood of a rems and if you think about the potential drug drug interactions that we're already mentioned previously.

There'd be an anticipation of any sort of warning label or restriction or country indication of those medications like beta blockers are antihypertensive for example.

The second question I have is again related to the Alzheimer's disease relapse one of the concerns that was brought up in the neighboring indication was the auto correlation.

With respect to within subjects designs. So curious if you could comment around the clinical meaningfulness of the view of the FDA from your perspective of the randomized withdrawal data as opposed to the parallel.

Design that you just announced thank you.

Thank you for the questions I think all of those questions around.

Who are the reasonable person to ask and now we will refrain from.

Answering those questions given where we are in and the stages.

Just given where we are in the labeling.

<unk> start with the FDA.

And with regards to could you repeat the question as it relates to the neighboring indication.

Yeah, absolutely yeah. Thank you. So the one of the concerns was the interpretation of the clinical meaningfulness of the within subjects design for the randomized withdrawal and so I'm curious if that was a driver of the clinical meaningful discussion and if you could comment on the robustness of the of that type of.

Design relative to the parallel to say thank you.

Yeah. That's a really good question and you know that is one of the limitations of a randomized withdrawal design.

So the randomized withdrawal design does a very good job of demonstrating that the drug works and to it as a control design.

But with regard to answering that particular question.

You that particular question is best answered with a parallel group design now we demonstrate that we have parallel data with the advance one trial.

Rudy: So starting that trial, it reflects our desire to make sure that we have as strong as possible of a data package when we submit the NDA for Alzheimer's disease education.

Do you have to you does typically like to see two studies.

We again, we're not initiating this new trial, because we think that it is absolutely needed, but want to make sure that.

Ah Postini E filing in a position of strength.

Especially given that this is an indication for which no product has been approved.

Okay. Thanks, so much for taking the question.

Okay.

Our next question comes from Matt Kaplan with Ladenburg Thalmann. Your line is now open.

Rudy: As you know, no product has been approved yet for this indication.

Hi, good morning, and thanks for taking the questions I just wanted to dig in to access us and then a little bit where are you in with respect to addressing CMC questions.

Details on the CRA all in and when do you think you could resubmit the NDA.

Yeah.

Hey, Matt This is mark so.

Rudy: So what we can do is make sure that we incorporate learnings where we can get them.

As you can imagine the team is doing its work in the background with the CMC team is doing its work following the <unk> and you know this morning, we did announce that Matt.

Requested and submitted a request for a type a meeting with FDA.

Rudy: As you know, there's been recent FDA action on a competitive product in another neurobehavioral symptom of Alzheimer's disease.

And what we plan to do is once that meeting was held which we would expect this quarter.

We'd expect it to be held this quarter. Once it tells US then we will be able to we'll be in a position to provide a clear update for our expectations around timing of the resubmission and if there are any.

Any nuances about the package or anything like that but right now it's status quo in terms of the last update we're in we think.

Rudy: This is psychosis, we think that it's prudent to have more than one shot on goal and to have two studies, both of which are parallel groups, that would replicate each other.

So everything was is addressable.

And that we either have the information on hand or are able to in a position to provide it prior to our or in connection with our resubmission. So so we'll hopefully have more.

For you in the not too distant future.

Rudy: So let's say that, of course, that is positive, then we're going to file.

Okay, Great. That's very helpful. And then just a quick follow up on your plans in ADHD for Sanofi.

Is it your expectation that a single phase III pivotal study in that indication could suffice for filing a supplemental NDA.

[laughter].

We anticipate that our two studies will be needed and so the first study is in adults.

Assuming that that study is positive we will then conduct a pediatric study.

Okay, great well congrats on the progress during the quarter.

Yeah.

Thanks.

Our next question comes from Vikram <unk> with Morgan Stanley . Your line is now open.

Okay.

Okay.

The crime you May proceed with your question.

At this time Theres No response, we will move on to the next question.

Our next question comes from the line of Myles Minter with William Blair. Your line is now open.

Hey, everyone. Thanks for taking the questions just the first one on July five.

You announced agreement to the post marketing commitment. She got it you would expect a decision in the second quarter on the filing.

Then announce you received a proposed label and didn't state anything about that timing guidance and now you're coming on the call, saying that it could be this month sorry. My question is.

A lot or was there an aha moment or something that gets you back on a regulatory timeline. That's happened in between your first initial disclosure Shaw that you'd received a proposed labeling and the discussions that you've had since then or is it more just you're pleased and therefore, you think it's coming.

Maybe this month thank you.

Hey, Myles.

It's mark so so yeah.

We did comment we're pleased on their overall status and.

Related to that the providing the guidance here or estimate of potential action is our sense of the current status of <unk>.

Of the process and where where we think we are.

Just to be clear, though FAA has not told us they plan to take action on a certain date. So so we don't have that it's based on our read of the information that's available to us in totality and that's what we're providing to you.

Okay. So just to clarify it it sounds like it wasn't like a specific event in your back and forth discussions it's more the totality of how those discussions are going that conduct.

The confidence to give the storm and got us.

Yeah. So there is of course, a choreography right, where there's back and forth and things like that and it's our read of.

With our holistic read of where we are.

Okay. Okay. That's helpful. And then just on the advanced an additional analysis that was requested by the F. D. A I mean, they gave us breakthrough therapy designation for that product and the indication why back in 2020.

And that was after they had reviewed the advance one trial and I think in your words, you you'd be able to use that as a pivotal study sorry, what additional information to die request from that trial after that keeping you. All these designations and looked at the trial initially thanks.

Okay.

Yes, because.

Because there is no.

No product that's been approved to treat autoimmune disease agitation.

There is also a ton of data on.

On a lot of the scales that are being used in the assessment of the disease. So from that perspective, the data from the advance one trial.

Pretty special and Theres a lot of there's a lot of information that can be mined from those those data so and I think that that's the that's the source of the suggested analyses, we found those useful and and Youre right.

With the advance one trial was the basis for the breakthrough therapy designation.

It's been great because with the breakthrough therapy designation that does allow us to have.

Lot of contact with the FDA and get their thoughts, which is especially valuable in a situation where.

We are doing pioneering work and and your.

Guidance for our members is welcome.

Okay final one for me is just I guess, where we're having this clinically meaningful discussion about endpoints. Here is advanced are you kind of have to say M. II standpoint, the cotton Mansfield.

Yes, it will.

Okay. Thanks for the questions.

Yeah.

Okay.

Thank you we'll take our final question from David <unk> with F. N B C. Your line is now open.

Hey, good morning, everyone and thanks for fitting me in and taking some questions. So.

So I just had a couple I think first one for me on <unk> five mm.

This may have been a while ago, but you know based on the study populations enrolled in D O five trials.

There was you were thinking was it the base case, where label would be major depressive disorder N D D pretty broadly.

Any reason to think differently now would there be any thought that the population could be narrower or any qualifiers or such.

<unk> in the label.

Okay.

Yes, thanks for the question.

What we've disclosed.

Is that the NDA that we filed.

West for major depressive disorder.

And with regards to what will be in the label as we've stated before you give appropriate for us to discuss.

About the label at this stage.

Okay understood.

That.

And then I had I had one just around the different tranches from your term loan if I heard correctly. One is obviously based on O. Five approval. There's another based on some sales milestones and then I think there's one more that is sort of that the you know the lenders discretion can you can you comment that's just too.

D that lost that last tranche, if I have it correctly.

You know what.

Stipulations or covenants are attached to that anything you can share and what is the amount there.

Yes, that's just a that's just actually a general tranche.

I'm sorry, this is Nick speaking.

It's a general tranche that is at the lenders' option.

That we would have the ability to request.

Based on business needs.

Okay.

Okay, great well, thanks for taking the question.

Rudy: We won't wait for advance two, right?

Thank you that ends our question and answer session I would now like to pass the conference back to management for closing remarks.

Rudy: So assuming that we have a data package that we think is adequate, what we would then do is have a pre-NDA meeting with the FDA.

Rudy: And after that meeting, we would be able to tell you whether or not the FDA believes that we should go ahead and file.

Operator: Our next question is from June Lee with Truist Securities.

Well. Thank you again for joining us on the call. Today. This is an exciting time for <unk> as we will transition to commercial stage.

Operator: Your line is now open.

Forward to continuing this momentum.

Joon Lee: Good morning.

Joon Lee: This is Awesome on for June.

<unk> NDA stage product candidates and five phase III stage clinical programs, we are committed to bringing potentially life changing medicines to people living with serious CNS conditions.

Joon Lee: Thanks for taking the questions.

Joon Lee: Our first question is, given known drug-drug interaction with bupropion, do you think patients currently on antidepressants will need to be washed out of existing drugs before they can be on AXS-O5?

Joon Lee: And how do you envision patients on standard antidepressants could be transitioned to AXS-O5 and have a follow-up?

Joon Lee: Thank you for the question.

Joon Lee: And if so, were items such as REMS part of that discussion?

Joon Lee: Drug-drug interactions are not unique to AXS-O5.

Joon Lee: We have had additional interactions, as we mentioned, we've been in labeling discussions, with the FDA.

Joon Lee: It's just that we are leveraging particular drug-drug interaction to improve the pharmacokinetics of the NMDA receptor antagonism of AXS-O5.

Joon Lee: And with regards to other aspects of, you know, what has been, of what has been discussed, as part of those negotiations, we will not comment on that, as you can, as you can imagine, it would be inappropriate at this stage.

Joon Lee: However, a lot of drugs do have drug-drug interactions, and there are sections in every package insert with regards to those drug-drug interactions, advising clinicians on how to navigate that.

Joon Lee: Okay, thank you.

Joon Lee: And it's something that clinicians are able to do.

Operator: Our next question comes from Yati and Suneja with Guggenheim Partners.

Joon Lee: Other antidepressants also have drug-drug interactions, and it is typical to have drug-drug interactions with antidepressants.

Bhubalan: This is Bhubalan dialing in for Ram Selvaraju.

Operator: Your line is now open.

Joon Lee: Okay, thank you for that.

Bhubalan: And thanks for taking my question.

Yati Suneja: Hey, guys, thank you for taking my question.

Joon Lee: And then just on the labeling discussions for O5, have you had any more interaction, with the FDA since you first disclosed labeling discussions?

Bhubalan: So we have a couple of questions.

Yati Suneja: Two for me, could you give a little bit more color on a Sanosi launch in terms of, you, know, how should we think about the performance in Q3?

We look forward to updating you over the coming months when all continued pipeline and commercial progress have a great day.

Bhubalan: So firstly, is there anything that you could provide with respect to AXX5 with a sustainable, competitive advantage versus other antidepressants in the later clinical stages of development?

Yati Suneja: Are you in a position to provide some sort of a guidance going forward, and at what point, you might be able to provide that?

Bhubalan: Well, I think, first of all, it's important to compare AXX5, our data in AXX5, to it's, important to compare that to actual phase 3 data with other product candidates.

Yati Suneja: So that's one.

Bhubalan: So to the extent that other product candidates have not generated that data, it's hard for, us to comment.

Operator: Our next question is from Joseph Thome with Cowen.

Yati Suneja: And then the other question I have is on the abuse liability for O5.

Bhubalan: What we can speak about is the clinical profile of AXX5 that we've demonstrated now in four, different clinical trials, at least, and also with long-term data that goes out to one year.

Operator: Your line is now open.

Yati Suneja: Could you just talk about the, is FDA comfortable with your, with the lack of abuse liability, data?

Bhubalan: What have we seen?

Joseph Thome: Hi there.

Yati Suneja: Because if you read the guidance for CNS drug, they definitely require some sort of an abuse, liability work.

Bhubalan: What we've seen is that there was a rapid antidepressant effect, which number was highly, statistically significant in week one with the Gemini trial. That was accompanied not just by symptom improvement, but also by an improvement in quality of life, which was statistically significant at week one. So the drug is making patients feel better, but it's also helping them to function better, very rapidly.

Joseph Thome: Good morning.

Yati Suneja: So just trying to get some sense there, thanks.

Bhubalan: And that's not been seen before with an oral antidepressant.

Joseph Thome: Thank you for taking my questions.

Yati Suneja: Yeah, so I'll answer the abuse liability question. You are correct that all CNS active drugs are required to assess the potential of those, drugs for abuse liability.

Bhubalan: Secondly, the magnitude of effect is very large with AXX5.

Joseph Thome: First one, on the depression review, and then I'll have a follow-up on Alzheimer's agitation, but on the current review, I know you mentioned that you're encouraged with the progress of the labeling discussions.

Yati Suneja: However, you know, how that's done really depends on the compound and if any signals, have been seen in clinical trials.

Bhubalan: It's also important to look at our remission data where there was more than a two-fold, increase in remission at week six as compared to placebo in that study. So you have a drug that works incredibly well objectively with regards to magnitude of effect that has a rapid onset and also which is durable.

This concludes today's conference and you may disconnect.

Joseph Thome: Maybe can you provide us a little bit of context on kind of what's inspiring that encouragement?

Yati Suneja: So as part of our NDA, you know, we did have to do that assessment, and as we've said in, the past, that has been done.

Bhubalan: And then lastly, the drug was incredibly well tolerated from our perspective.

Joseph Thome: Are you currently waiting for the FDA or are they waiting for analysis or any data from, you?

Yati Suneja: And I'll turn it over to Nick and Lori to answer your questions regarding CINOSI.

Bhubalan: So and, you know, remember this is a novel mechanism of action.

Joseph Thome: And then last part on this, what would constitute sort of a disclosable release to investors, from the review?

Yati Suneja: Hang on.

Bhubalan: It's nice to have a novel mechanism of action, but when that new mechanism of action actually translates to clinical benefit, then it really tells clinicians, hey, there's something new that should be considered in trying to treat patients who are not responding to current treatments.

Joseph Thome: Is the next thing we're going to hear a decision or is there any potential kind of intermediate, steps before that point?

Yati Suneja: So I'll quickly just kind of give you some data points that help, you know, give some, color around, you know, performance so far, you know, from the CINOSI acquisition, and then I'll toss it over to Nick in terms of guidance.

Bhubalan: And as a reminder, the percentage of patients who don't respond well to current treatments is nearly 70%.

Joseph Thome: So we said that we've been pleased with the progress of those negotiations, and I think, one, we're pleased that we did in terms of labeling negotiations, and we're pleased because there has been interactions with the FDA with regards to the label, and that is progressing.

Yati Suneja: So, you know, we are, you know, we're still very much learning and assessing the market, post the transition.

Thank you for your participation and have a wonderful day.

Bhubalan: Thanks for the detailed color.

Joseph Thome: So the next disclosable event that we anticipate would be an FDA action.

Yati Suneja: And as I mentioned earlier, we've aligned to 75 territories, you know, the reps that, are currently out promoting now are really incredibly high caliber sales force, and they are generating productivity levels of sales forces, you know, one and a half to two times the size that they are right now.

Mark Jacobson: Have a great day.

Bhubalan: So with respect to XEOS commercialization activities, what are your updated thoughts on this and how do you plan to optimize the value of your assets?

Joseph Thome: Okay.

Yati Suneja: We believe that a lot of that has to do with, you know, the underlying momentum from CINOSI, as well as being able to effectively execute through DCC.

Operator: This concludes today's conference and you may disconnect.

Operator: [music]

Bhubalan: So it's always been our stated corporate objective to out-license our product candidates for XEOS markets while we focus on the U.S. With the CINOZI acquisition, though, we have now become a global biopharmaceutical company, and there are sales of CINOZI XEOS which are growing.

Joseph Thome: Perfect.

Yati Suneja: So really proud of, you know, what the team was able to do in terms of, you know, potentially, facing a very disruptive quarter.

Operator: Thank you for your participation, and have a wonderful day.

Bhubalan: We did not comment on that portion of the business this quarter because we have not yet closed on the XEOS portion of the acquisition.

Okay.

Joseph Thome: And then on the Alzheimer's disease agitation and the PR, it does mention that you amended, the relapse criteria for the ACCORD study.

Yati Suneja: And as I mentioned, you know, in the prepared remarks, you know, quarter over quarter growth, was 7%, which really, you know, really is impressive given what could have happened, Yeah, thanks, Lori.

Bhubalan: That may inform our strategy going forward, whether that means more robust business development XEOS or another TAC now that we actually do have some infrastructure XEOS.

Joseph Thome: Are you able to give a little bit of context as to how that changed?

Yati Suneja: The quarter, as Lori mentioned earlier, could have been extremely disruptive at this stage in the opening remarks.

[music].

Bhubalan: Great.

Joseph Thome: And then with the parallel control group trial, was this something that the FDA suggested, or something that you and the team thought would be helpful to wrap up the profile?

Yati Suneja: We had $8.8 million in net sales.

Bhubalan: One final question from me.

Joseph Thome: Thank you.

Yati Suneja: That was actually 22% year-over-year growth in scripts, so I'm highly satisfied with how the transition has taken place so far.

Bhubalan: So you're stepping into ADHD.

Joseph Thome: Yeah.

Yati Suneja: As a reminder, on our Cenosi webcast that we had just a couple months ago, we believe the EDS market in OSA and narcolepsy has the potential to have peak sales in the $300 million to $500 million range.

Bhubalan: As you may know, this is a decently crowded indication.

Joseph Thome: It's something that we thought would be helpful in the context of looking at the experience, with the development of drugs in neighboring indications in Alzheimer's disease.

Yati Suneja: At this point, we're not – we won't be able to give guidance for the rest of the year as we're still learning, but, you know, obviously very positive transition thus far.

Bhubalan: So just would like to hear your thoughts.

Joseph Thome: And with regards to the relapse criteria question, what we were able to do at the suggestion, of the FDA was to look at the results from the advanced trial, which were positive, and there was a lot of data to be mined there, and particularly looking at how one would look at clinical meaningfulness with the various scales. And so that informed the change in the relapse criteria so that they're consistent with the, results of the advanced one trial.

Yati Suneja: Thank you.

Bhubalan: You know, what's your value proposition here and what are some of the unmet needs that you're planning to address with CINOZI?

Joseph Thome: Okay.

Operator: Our next question comes from Jason Gerberry with Bank of America.

Bhubalan: So we're very excited by the clinical profile of CINOZI as it relates to a potential effect in ADHD.

Joseph Thome: Thank you very much.

Operator: Your line is now open.

Bhubalan: However, we want to make sure that we don't jump the gun here.

Operator: Our next question is from Craig Suvinovich with Mizuho Securities.

Jason Gerberry: Oh, hey, guys.

Bhubalan: We want to run the clinical trial and to see what the results are.

Operator: Please proceed with your question.

Jason Gerberry: Thanks for taking my questions.

Bhubalan: In terms of what the value proposition is, there is a lot of unmet need in ADHD.

Craig Suvinovich: Thank you very much, and good morning.

Jason Gerberry: You know, I just wanted to come back to the cash question.

Bhubalan: As you know, most of the drugs that are currently available are highly scheduled drugs.

Craig Suvinovich: Thank you for taking my questions.

Jason Gerberry: I'm a little confused.

Bhubalan: And the ones that are not highly scheduled do not have a large treatment effect.

Craig Suvinovich: As I'm relatively new to the name, just on AXS-12 for narcolepsy, could you just remind, me what the TPP is and how you expect to position that relative to Sanosi?

Jason Gerberry: So, it seems like you're unlikely at a point where some sort of Cenosi sales threshold maybe triggered more access to the Hercules facility.

Bhubalan: So I think there is value here potentially with CINOZI should the results in ADHD match the results in EDS.

Craig Suvinovich: And then separate on Sanosi and ADHD, could you just remind me what the dosing is, especially, relative to that in EDS, Sanosi, and narcolepsy?

Jason Gerberry: And then on the AD education update, I'm just curious, why not start the new trial sometime in the fourth quarter after the randomized withdrawal update, presuming if that randomized withdrawal study update could facilitate approval and the cash is dire, you know, or dear for you guys?

Bhubalan: And what I mean by that is if you look at the results for CINOZI in EDS, the treatment effect is very large. In fact, it's larger than other weight-promoting agents. And so you have this large effect size.

Craig Suvinovich: As, a reminder, Sinozi is approved to treat patients with narcolepsy. It's approved for patients, for the treatment of EDS in patients with narcolepsy.

Jason Gerberry: Why not wait to see if that could facilitate approval before starting another study?

Bhubalan: You know, hoping that we might see that in the ADHD trial.

Craig Suvinovich: So there is no … It does not have an effect on cataplexy.

Jason Gerberry: Thanks.

Bhubalan: And we're looking forward to initiating that study in the fourth quarter.

Craig Suvinovich: That's the difference between the two.

Jason Gerberry: Yeah.

Bhubalan: Thanks for taking our questions.

Craig Suvinovich: And with regards to the dosing of Sinozi in ADHD, you know, we have not disclosed the, dose that we are going to be studying in the Phase III trial, but we look forward to disclosing that once we announce the initiation of that study.

Jason Gerberry: So, related to the Cenosi comments.

Craig Suvinovich: Thank you.

Jason Gerberry: So, I guess maybe a little bit of background on Cenosi.

Operator: Our next question is from Chris Howerton with Jeffrey's.

Jason Gerberry: The guidance that we previously stated and, you know, feel comfortable to state is that we do expect a small loss in the stub period this year, Jason, utilize the tranche for a $50 million.

Operator: Your line is now open.

Jason Gerberry: So, access to the Hercules facility would be available potentially next year.

Chris Howerton: Great.

Jason Gerberry: I'll turn it over to Ariel to answer the other questions.

Chris Howerton: Lots of great questions so far.

Ariel: And actually, yeah, one last question.

Chris Howerton: Thanks so much for taking some from me.

Nick: One other comment that you made related to burn.

Chris Howerton: Two for me.

Nick: Burn, I think you had mentioned somewhere around $40 million. Our average four-month cash burn has actually been closer to $30 million.

Chris Howerton: One, first on O5, with respect to the potential label and approval, you know, what are the, company's thoughts around the likelihood of a REMS, and, you know, if you think about the potential drug-drug interactions that were already mentioned previously, would there be an anticipation of any sort of warning label or restriction or contraindication of those medications, like beta blockers or antihypertensive, for example?

Nick: So, I just wanted to clarify that.

Chris Howerton: The second question I have is, again, related to the Alzheimer's disease relapse.

Ariel: And then with regards to the question around the start of the Alzheimer's disease agitation, trial.

Chris Howerton: One of the concerns that was brought up in the neighboring indication was the autocorrelation, with respect to within-subjects designs, so curious if you could comment around the clinical meaningfulness of the view of the FDA from your perspective of the randomized withdrawal data as opposed to the parallel design that you just announced.

Ariel: So what we want to make sure that we do is continue our history the way that we do things, of rapidly developing our product candidates. And so it makes sense for us to start that study sooner rather than later.

Chris Howerton: Thank you.

Ariel: So we made the determination and guess what, we're on track to start that study actually, this quarter.

Chris Howerton: Thank you for the questions.

Ariel: So we're very proud of that.

Chris Howerton: I think, you know, all of those questions around label are reasonable questions to ask, and we will refrain from answering those questions given where we are in the stages.

Ariel: And in terms of waiting until the fourth quarter, remember the study that we are launching which, is a parallel group trial, we have a lot of information to guide us to the design of that study. And this will be essentially a repeat of our positive advanced one trial.

Chris Howerton: Given where we are in the labeling discussions with the FDA.

Ariel: So we'll take the learnings from that and that will allow us to make sure that we tweet, where needed the design of the current study, of the new study.

Chris Howerton: And with regards to, could you repeat the question as it relates to the neighboring, indication?

Jason Gerberry: Got it.

Chris Howerton: Absolutely.

Jason Gerberry: Okay.

Chris Howerton: Yeah.

Operator: Thanks, guys.

Chris Howerton: Thank you.

Operator: Our next question comes from Ram Selvaraju with H.E.

Chris Howerton: So, one of the concerns was the interpretation of the clinical meaningfulness of the within-subject, design for the randomized withdrawal, and so I'm curious if that was a driver of the clinical meaningful discussion, and if you could comment on the robustness of that type of design relative to the parallel design.

Operator: Wainwright.

Chris Howerton: Thank you.

Operator: Your line is now open.

Chris Howerton: Yeah, that's a really good question.

Bhubalan: Hi.

Chris Howerton: And you know, that is one of the limitations of a randomized withdrawal design.

Chris Howerton: So the randomized withdrawal design does a very good job of demonstrating that the drug works. And so it is a controlled design.

Chris Howerton: And, but, you know, with regards to answering that particular question, you that particular question is best answered with a parallel, group design.

Chris Howerton: Now we demonstrate, now we have parallel group data with the ADVANCE-1 trial.

Chris Howerton: The FDA does typically like to see two studies.

Chris Howerton: You know, we, again, you know, we're not initiating this new trial because we think that it is absolutely needed, but we want to make sure that we approach the MD filing in a position of strength, especially given that this is an indication for which no product has been approved.

Chris Howerton: Okay.

Chris Howerton: Thanks so much for taking the questions.

Operator: Our next question comes from Matt Kaplan with Ladenburg-Salmon.

Operator: Your line is now open.

Matt Kaplan: Hi, good morning, and thanks for taking the questions.

Matt Kaplan: I just wanted to dig into AXS07 a little bit.

Matt Kaplan: Where are you with respect to addressing the CMC questions detailed in the CRL?

Matt Kaplan: And when do you think you could resubmit the NDA?

Matt Kaplan: So, as you can imagine, the team is doing its work in the background.

Matt Kaplan: The CMC team is doing its work following the CRL.

Matt Kaplan: And, you know, this morning we did announce that we've requested and submitted a request for a type A meeting with FDA.

Matt Kaplan: And what we plan to do is once that meeting is held, which we would expect this quarter, we'd expect it to be held this quarter.

Matt Kaplan: Once it's held, then we'll be able to – we'll be in a position to provide a clear update for our expectations around timing of the resubmission and if there are any nuances about the package or anything like that.

Matt Kaplan: But right now it's status quo in terms of the last update wherein we think everything is addressable and that we either have the information on hand or are able to – in a position to provide it prior to our – or in connection with our resubmission.

Matt Kaplan: So we'll hopefully have more for you in the not-too-distant future.

Matt Kaplan: Okay, great.

Matt Kaplan: That's very helpful.

Matt Kaplan: And then just a quick follow-up on your plans in ADHD for CINOSI.

Matt Kaplan: Is it your expectation that a single Phase 3 pivotal study in that indication could suffice for filing a supplemental NDA?

Matt Kaplan: We anticipate that two studies will be needed.

Matt Kaplan: And so the first study is in adults, and I'm assuming that that study is positive.

Matt Kaplan: We will then conduct a pediatric study.

Matt Kaplan: Okay, great.

Matt Kaplan: Well, congrats on the progress during the quarter.

Matt Kaplan: Thanks.

Operator: Our next question comes from Vikram Parohit with Morgan Stanley.

Operator: Your line is now open.

Vikram Parohit: Operating Again,

Vikram Parohit: Vikram, you may proceed with your question.

Operator: At this time there is no response, we will move on to the next question.

Operator: Our next question comes from the line of Myles Minter with William Blair.

Operator: Your line is now open.

Myles Minter: Hey everyone, thanks for taking the question.

Myles Minter: This is the first one on 05.

Myles Minter: I know when you announced agreement to the post-marketing commitment, you guided you'd expect a decision in the second quarter on their filing.

Myles Minter: You then announced you received a proposed label and didn't state anything about that timing guidance, and now you're coming on the call saying that it could be this month.

Myles Minter: So, my question is, what or was there an aha moment or something that gets you back on a regulatory timeline, that's happened in between your first initial disclosure that you'd received a proposed labeling and the discussions that you've had since then?

Myles Minter: Or is it more just you're pleased and therefore you think it's coming maybe this month?

Myles Minter: Thank you.

Mark: Hey Myles, it's Mark.

Mark: So, yeah, we did comment we're pleased on their overall status.

Mark: And related to that, providing the guidance here or estimate of potential action, is our sense of the current status of the process and where we think we are.

Mark: Just to be clear though, FDA has not told us they plan to take action on a certain date.

Mark: So, we don't have that.

Mark: It's based on our read of the information that's available to us in totality, and that's what we're providing to you.

Myles Minter: Okay.

Myles Minter: So, just to clarify, it sounds like it wasn't like a specific event in your back and forth discussions. It's more the totality of how those discussions are going that kind of gives you the confidence to give this timing guidance.

Myles Minter: Yeah.

Myles Minter: So, you know, there is, of course, a choreography, right, where there's back and forth and things like that.

Myles Minter: And it's our read of, you know, it's our holistic read of where we are.

Myles Minter: Okay.

Myles Minter: Okay.

Myles Minter: That's helpful.

Myles Minter: And then just on the ADVANCE-1 additional analysis that was requested by the FDA, I mean, they gave you breakthrough therapy designation for that product in the indication way back in 2020.

Myles Minter: And that was after they'd reviewed the ADVANCE-1 trial.

Myles Minter: And I think in your words, you know, you'd be able to use that as a pivotal study.

Myles Minter: So, what additional information did they request from that trial after they'd given you all these designations and looked at the trial initially?

Myles Minter: Thanks.

Myles Minter: Yeah.

Myles Minter: Because there is no product that's been approved to treat Alzheimer's disease agitation, there isn't also a ton of data on a lot of the scales that are being used in the assessment of the disease.

Myles Minter: So, from that perspective, you know, the data from the ADVANCE-1 trial are pretty special. And there's a lot of information that can be mined from those data.

Myles Minter: So, and I think that's the source of the suggested analyses.

Myles Minter: We found those useful.

Myles Minter: And you're right, the ADVANCE-1 trial was the basis for the breakthrough therapy designation. And it's been great because with the breakthrough therapy designation, that does allow us to have a lot of contact with the FDA and get their thoughts, which is especially valuable in a situation where we are doing pioneering work. And some guidance from them as well.

Myles Minter: Okay, final one for me is just, I guess, we're having this clinically meaningful discussion, about endpoints here.

Myles Minter: Is Advanced 2 going to have the CMAI as the endpoint, the current, Mansfield?

Myles Minter: Yes, it will.

Myles Minter: Cool.

Myles Minter: Okay, thanks for the questions.

Operator: Thank you.

Operator: We'll take our final question from David Hoang with SMBC.

David Hoang: Your line is now open.

David Hoang: Hey, good morning, everyone.

David Hoang: Thanks for fitting me in and taking some questions.

David Hoang: So, I just, had a couple.

David Hoang: I think first one for me on O5, this may have been a while ago, but, you know, based on the study populations enrolled in the O5, you know, trials, I think there was, your thinking was that the base case for a label would be, you know, major depressive disorder, MDD, pretty broadly.

David Hoang: Any reason to think differently now?

David Hoang: You know, would there be any thought that the population could be narrower or any qualifiers or such specified in the label?

David Hoang: Yeah, thanks for the question.

David Hoang: We, what we've disclosed is that the NDA that we filed was, for major depressive disorder.

David Hoang: And with regards to what will be in the label, as we've stated before, it'd be inappropriate for us to discuss anything about the label at this stage.

David Hoang: Okay, understood that.

David Hoang: And then I had one just around the different tranches from your, term loan.

David Hoang: If I heard correctly, one is obviously based on O5 approval.

David Hoang: There's another based on some sales milestones.

David Hoang: And then I think there's one more that is sort of at the, you know, the lender's discretion.

David Hoang: Can you, can you comment as just to the, that last tranche, if I have it correctly, what, you know, what stipulations or covenants are attached to that, anything you can share and what is the amount there?

David Hoang: Yeah, that's just a, that's just actually a general tranche that, I'm sorry, this is, Nick speaking.

Nick: It's a general tranche that is at the lender's option that we would have the ability to request, you know, based on business needs.

Nick: Okay, great.

David Hoang: Well, thanks for taking the question.

David Hoang: Thank you.

Operator: That ends our question and answer session.

Mark Jacobson: I would now like to pass the conference, back to management for closing remarks.

Mark Jacobson: Well, thank you again for joining us on the call today.

Mark Jacobson: This is an exciting time for Axon, as we transition to commercial stage and are looking forward to continuing this momentum with our two in the stage product candidates and five phase three stage clinical programs.

Mark Jacobson: We are committed to bringing potentially life changing medicines to people living with serious, CMS conditions.

Mark Jacobson: We look forward to updating you over the coming months on our continued pipeline and commercial progress.