Q3 2022 Intra-Cellular Therapies Inc Earnings Call

The conference will begin shortly to raise your hand during Q&A you can dial star one one.

[music].

Good morning, ladies and gentlemen, and welcome to intra cellular therapies third quarter earnings call. At this time all participants are in a listen only mode. After the speaker presentation there'll be a question and answer session to ask a question during the.

Session, you will need to press star one one on your telephone please limit yourself to one or two questions. As a reminder, today's conference call is being recorded I would now like to turn the conference over to Dr. Juan Sanchez, Vice President corporate Communications and Investor Relations.

Good morning, and thank you all for joining us on the call today.

Our earnings press release provide a corporate update and details of the company's financial results for the third quarter ended September 32022.

This press release crossed the wire.

This morning, and is available on our website at intra cellular therapies dot com.

Joining me on the call today are Dr. Sharon mates, Chairman and Chief Executive Officer, Mark Newman.

Executed Vice President and Chief Commercial Officer, Dr. Doug Aron Executive Vice President and Chief Medical Officer.

Larry Hineline, senior Vice President and Chief Financial Officer.

As a reminder, during today's call, we will be making certain forward looking statements.

These statements May include statements regarding among other things.

Efficacy safety safety and intended use of the company's product development candidates.

Our clinical and non clinical plans, our plans to present and report additional data the <unk>.

Anticipating conduct and results of ongoing and future clinical trials.

Plans regarding regulatory filings future.

Future research and development, our plans and expectations regarding the commercialization of <unk> potential impact of COVID-19 pandemic on our business.

Possible uses.

Existing cash and investment resources.

These forward looking statements are based on current information assumptions and expectations.

Which are subject to change and involve a number of risks and uncertainties that might cause actual results to differ materially from those contained in the forward looking disclaimer.

These and other risks are discussed 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 forward looking disclaimer.

The company disclaims any obligation to based purchase agreements.

I will now turn the call over to Sharon.

Thanks Juan.

Morning, everyone I'm excited to be here today to share our third quarter results, including our ongoing success with kept lightest launch in bipolar one and bipolar depression I will.

So share our progress on our pipeline.

Following my remarks, Mark will elaborate on our commercial progress and Larry will provide details on our financial performance. We will then open the call for questions.

We are pleased with the continued performance of kept later in this quarter. We are reporting robust net product revenues of $71 9 million.

This represents a 233% increase over the same period in 2021, and a sequential increase of 30% over the second quarter 2022.

The fundamental growth indicators for kept lighter are strong.

We are making appropriate investments in our business to maximize the full potential of this important medicine and are highly confident in our continued growth.

The acceleration and kept widest uptake following our label expansion of bipolar disorder to our indication of schizophrenia confirms the continued medical need in these disorders and the value kept light it brings to patients.

We are excited to see the acceleration in our bipolar prescriptions as these disorders are four to five times more prevalent than schizophrenia.

It's a highly prevalent there are more than 11 million people in the U S living with bipolar disorder. In addition, more than 20 million Americans experience Uni polar depression referred to as major depressive disorder or M. D D <unk>.

Patients with these disorders are often highly functional and are significantly involved in their treatment decisions.

It is important to highlight but the majority of these patients are not adequately treated with initial therapy there.

There are only a few F D. A approved anti psychotic treatment options for these conditions and patience need options for treatment with proven efficacy and favorable safety profile.

Major anti psychotic brands have achieved commercial success, primarily as a result of their mood disorder approval, resulting in the uptake of these drugs and populations with large numbers of patients.

This is proving true with kept lighter incur.

Increasingly larger portion of prescriptions coming from bipolar depression.

Kept light it is the first and only anti psychotic approved for the treatment of bipolar one or bipolar two depression and adults as mono therapy, and his adjunctive therapy with with <unk>.

We expect continued growth in bipolar depression, and schizophrenia as we continue to pursue additional label expansion opportunities.

We have a pivotal program evaluating limit teflon as an adjunctive therapy to antidepressants for the treatment of M. D. D. In those patients who have had an adequate response to any depressive.

Patient enrollment is ongoing and studies five O one and five O. Two are global phase III Mtb's studies evaluating luma tougher on 42 milligrams for the adjunctive treatment of depression.

The primary endpoint has changed from baseline on the Madras total score at week six.

In addition to the efficacy studies, we have an ongoing long term open label rollover study to further assess safety in this patient population patient.

Patients enrollment is in line with our expectations.

We expect to file a supplemental new drug application with the F. D. A for approval of <unk> as an adjunctive therapy antidepressants for the treatment of M. D D in 2024.

We have a great deal of confidence in our M. D. D program, the depressive episodes within M. D D and bipolar disorder have the same characteristics and we measured the depressive episodes with the same scale. The Madras total score and both M D D and bipolar disorder.

Positive results from a bipolar depression studies and the robust evidence coming from the demonstration of efficacy in these studies coupled with the positives real life feedback we received on patients with bipolar depression being treated with capital Ida gives us further confidence for our ongoing programs and mood disorders.

We are also evaluating limits have grown in patients with M. D D or bipolar depression, who exhibit mixed features we.

We are pleased to announce we recently completed patient enrollment and study four O three and expect to report top lines of in the first quarter of 2023.

Study four O three is a well controlled global clinical trial evaluating move a Tesla on 42 milligrams as mono therapy in patients with M. D. D for bipolar disorder, who exhibit mixed features during their current depressive episode.

She is assessed at week six and there is a follow up safety visit two weeks after the last medication dose.

Primary endpoint of this study is change from baseline versus placebo on the mattress total score at week six.

Secondary endpoint is the change from baseline on the C. G I S.

Our confidence in this program is in part guided by our previous study. We have conducted a retrospective analysis of study four O four evaluating the antidepressant effects of limits have grown in a subgroup of bipolar depression patients meeting the criteria for mixed features at baseline.

And this analysis limits half of them had robust anti depressant effect is measured at week six.

Madras total score at the C. G I S.

Just to remind you the mixed features specifier and the D. S. M. Five highlights an important group of patients with M D D and bipolar depression.

When patients experienced a major depressive episode, there's symptoms can be accompanied by sub threshold manic or hypomanic symptoms.

25 to 40 per cent of patients experienced these symptoms, which often correlates with a worst disease prognosis. These patients have more severe illness, and higher recurrence rate comorbidities and rates of suicide and suicidal ideation.

M D D patients with mixed features respond poorly to antidepressants and are at higher risk of developing bipolar disorder.

Or no approved M D D or bipolar depression medicine that includes this important specifier in their label.

We believe luma tepper on safety and Tolerability make it a strong treatment option for these patients and we look forward to sharing the top line results I'm 34 O three with Ya.

Turning to our ongoing on the tougher on long acting injectable program. Our goal with this program is to develop long acting injectable formulations of women <unk> that are effective safe and well tolerated and last one month and longer.

We have conducted a phase one single waste ending dose study with our first formulation.

[noise] evaluated the pharmacokinetic safety and Tolerability of <unk> long acting injectable impatience with stable symptoms of schizophrenia.

We have also explored alternate site of injection with this formulation and we've been progressing additional formulation.

We are finishing the analyses of these studies and will enable us to define the next step in this program.

We expect to provide an update on this program on our next call.

Let me provide a brief summary of our other clinical trial activity, starting with limit type room.

We are conducting a relapse prevention study in patients with schizophrenia and expect patient enrollment to complete in late 2023.

Timing of data release will depend on the rate of relapse and the trial, we will update U S trials progressive.

We recently completed several luma tapped her on phase one study, including a study evaluating the P K safety and Tolerability profile in pediatric patients with schizophrenia.

This study demonstrated that luma tapped wrong, it's generally safe and well tolerated in this patient population in patients with cheese comparable drug levels to the adult population with 42 milligrams of <unk>.

Other early stage trials is wilmer kept on our ongoing or planned.

Turning to 12 84 are deuterated form of them, a <unk>, a new chemical entity formulated as an oral disintegrating tablets for Sublingual administration. We recently completed a food intake study study demonstrated that food had no significant impact on the PK profile. So we expect ITI 12.

84 can be given with or without food.

We have also completed phase one safety studies, demonstrating ITI 12, 84 is safe and generally well tolerated and normal healthy volunteers and normal healthy elderly volunteers.

Other save one studies are ongoing or planned and include drug drug interactions studies in mass balance studies.

We also continue to progress part toxicology program.

We expect to commence clinical conduct in phase two clinical trials and agitation in patients with probable alzheimers disease, and dementia related psychosis and certain other disorders in 2023.

And R. P. D. One inhibitor program, we've recently completed or have ongoing phase one trials with our lead molecule lend Ms potent including drug drug interactions bio availability from scale up batches and food effect studies.

Our I T I Triple three program for opioid use disorder and pain is also progressing.

We have completed a single a sending dose study and our neuro imaging studies ongoing.

The objective of this study is to investigate brain occupancy target receptor that play a role in these conditions.

Following neuro imaging studies, which will help determine the dose selection for future studies, we plan to initiate a multiple of sending those study.

The progress being made across our programs underscores our commitment to invest in the building blocks for our long term growth.

We ended the quarter in a strong financial position with $635 million in cash cash equivalents and investment securities. We have no death.

Just kept lighter in our pipeline of promising new treatments, we continued to fulfill our mission to develop safe effective and innovative medicines that improve the lives of patients with neuropsychiatric and neurologic disorders.

Kept light I had a very strong quarter and we are confident in the continuation of kept lightest growth momentum throughout next year in years to come.

I will now turn the call over the Mark will provide additional information kept lightest commercial performance Mark.

Thanks, Sir good.

Good morning, everyone.

The blood is launching bipolar depression continues to go very well.

Launch fundamentals are strong across all commercial metrics and we remain confident that kept lighter will experience continued robust growth.

During the third quarter avoid the total prescriptions grew 26% sequentially versus the second quarter of 2022.

220% year over year versus the third quarter of 2021.

The budget growth this quarter is particularly impressive considering the impact of summer seasonal that saw the overall oral anti psychotic market Register no growth for the quarter.

We expect the market to return to growth in queue for and with that a further acceleration and kept lighter prescription growth to close out the year.

Couple of items posted Rico per week increases in total prescriptions and five of the last six weeks.

Looking at the longer term trends, while our schizophrenia franchise continues to grow nicely.

Right I have experienced substantial growth in the first nine months following our launch an bipolar depression.

Since launch new prescriptions have tripled.

Weekly new patient starts art levels five times higher than they were prior to our label expansion.

We are encouraged thrift upload is updated across a broad range of patients with bipolar depression, consistent with our approved indications.

Hi, Sharon mentioned, an increasing proportion of prescriptions are coming from bipolar depression.

Polar depression already accounts for the largest share of both new patient starts and total patients.

The blood is compelling profile is resonating well with prescribers.

Ah blood is the only in a psychotic with proven efficacy in adults with both bipolar one and bipolar depression.

Mono therapy, and adjunctive therapy with lithium whereabouts.

That is a favorable safety and tolerability profile with weight metabolic changes EPS and akathisia, all similar to placebo.

Satellite is a once a day medication that does not need penetration and can be taken with or without food.

These are powerful reasons to prescribed.

Step light of market access coverage remains very strong.

Coverage in the Medicare part D and Medicaid channels remains greater than 98%.

And we have approximately 85% coverage and the commercial channel and.

In addition.

Light is labeling patient and prescriber support programs continue to be very effective at addressing coverage and reimbursement processes.

And overall patient affordability where appropriate.

Our broad market access and commercial efforts, including sales activity and well attended medical education events.

Combined with Papillitis favorable profile are driving the robust uptake in prescription.

Mid August we introduced two new dosage strengths, but <unk> for use in special populations.

Typically those with hepatic impairment and.

And those can commonly taking C Y P 384 inhibitors.

Launch these doses makes a cup light available to a broader population of patients living with bipolar depression as well as schizophrenia.

In summary, we are very pleased with tabloid as strong growth and we are making the appropriate investments to insure continued commercial success.

We are very confident in our ability to drive long term value creation, and we continue to work with health care providers to help patients with bipolar depression and schizophrenia.

I will now turn the call over to Larry.

Harris.

Thank you Mark I will provide a summary of our financial results from the third quarter ending September 30th 2022.

Total revenues in the third quarter grew to $71.9 million compared to $22.2 million in the third quarter of 2021.

And the third quarter, we recorded net product revenue of capital either of $71.9 million compared to $21.6 million for the same period of 2021 and $55.1 million in the second quarter of 2022.

This represents a year over year increase of 233% and a 30% increase over the second quarter of 2022.

And the third quarter or gross to not adjustment percentage remained in the low thirties consistent with our previously communicated gardens, we expect the gross to note percentage for the fourth quarter to remain in the low thirties.

Inventory levels in the trade measured by days on hand with cats at the wholesaler level remain consistent throughout the third quarter in line with historical and expected levels.

Cost of the product sales were $5.9 million in the third quarter of 2022 compared to $2 million from the same period of 2021.

So in general and administrative expenses.

$8.4 million from the third quarter of 2022 compared to $70.5 million for the same period of 2021.

This increase was primarily due to an increase in marketing and advertising expenses and labor related cost.

Research and development expenses for the third quarter of 2022 were $33.3 million compared to 20 $70 million for the third quarter of 2021.

This increase is due to higher Lima, Lima, covering clinical trial, and nonclinical related costs and an increase in non Luma Cup of our own program costs.

Net loss of in the third quarter of 2022 was $53.5 million compared to a net loss of $76.9 million from the third quarter of 2021.

Gosh catch equivalence restricted cash and investment Securities total $635 million at September 30th 2022, compared to $413 $7 million at December 31, 2021.

In January 2022, we've completed a $460 million public offering resulting in a net proceeds to the company of approximately approximately $433 $70 million.

Concludes our prepared remarks, operator, please open the line for questions.

Thank you as a reminder to ask a question you will need to press star one one on your telephone please stand binary compiler kunai roster.

[noise]. Our first question comes from Jessica Firewood J P. Morgan you May proceed.

Hey, guys. This is Nick on for Jessica Thanks for taking our questions with data from mixed features study expect anyone Q23, how should we be thinking about good data for the benchmark and when that day to reach out what level of read across D. C and the N B D. Five O one a private two studies. Thanks.

So thanks for the question and thrash I'll ask you to start and maybe maybe you want to start with the second part of the question.

No.

What you think about Ah read through between M. D D and mixed features and bipolar <unk> feet.

Features and then we'll go from there.

Okay.

Thank you for the question.

Regarding.

The mixed features.

D D D.

These are a different person population.

Studies.

We just population study.

Monotherapy study.

And that drink to treatment.

The significant portion of the splenda.

We just tend to be more difficult to please.

Goodness.

<unk>.

And how high Comorbidities.

And it looks like a big basis.

Having said that we are optimistic about this program given the data that we have.

Perfect Your analysis, Australia.

Waiting to enter the <unk> and the subgroup of bipolar depression patients meeting the criteria for mixed because had baseline.

In this analysis.

Unlimited put an AD robust antidepressant effects.

And.

<unk> right now.

No treatment available at this time.

Have a <unk>.

Okay.

[noise] labeled indications are mixed feature.

And the bad part about for this.

He's.

Not laid out yet so we are we are.

Doing this study.

And they have not been so far any studies at this time.

In terms of getting enough at all for this.

But I think the treatment of M D D.

There is a path already laid out a few drugs under the uproar.

I wanted to get treatment. However, there is still room for improvement.

Of the safety profile of the compounds nakedness.

Mechanistically.

The.

<unk> is it looks strong in terms of the <unk> antagonism.

And we have taken division and also the indirect effects.

Of.

Indirect Netflix on <unk>, which acts through an M b, a and amp <unk>.

An audition bipolar depression programs, both S mono therapy as well as a drink the treatments. We have shown that limited had showed significant improvement in because of symptoms.

In addition.

We have also shown back.

A subset of patients who have been.

Russian and concomitant antidepressants.

Those patients who are not an antidepressant.

Showed significant improvement in because of the symptoms.

In essence, I would say that that these people have different populations.

And I would see.

See them as independent studies.

Making any statements about one way or another.

Okay. Thank you.

Thank you one moment for questions.

Our next question comes from Andrew side with Jeffries you May proceed.

Alright, Thanks, and good morning, a big congrats on another great quarter, nice job and execution [laughter] I guess my question is around type of items trajectory over the next six to 12 months as you think about the acceleration.

What would be the specific drivers in terms of increasing demand and growing market penetration and what I guess specific leading indicators will you be looking at to give you that type of confidence.

Great Great Hi, Andrew and thanks for the questions and maybe Mark would you like to take that.

Yeah sure. Thanks, Andrew and yes, we do we continue to see very strong underlying demand in the marketplace for cap light up.

As well as increasing prescriber adoption, both in terms of breath prescribing, adding <unk>.

Significantly more new prescribers to Capitol, Ida as well as existing prescribers, increasing their depth of prescribing in both of those indicators.

Positive to us I think.

What I would say is were highly confident that kept lyda will continue to experience the kind of robust growth that we've seen in.

And the first three quarters of the launch and there are several reasons for that at first and foremost we continue to have the potential to significantly increase our prescriber base. We're pleased with our prescriber reached the date and the growth that you've seen over the last several quarters.

But we're still early in the launch and we have a significant additional prescriber cool that we expect to access in the coming months enters the COVID-19 environment continues to stabilize that.

That will improve our ability to access providers and increased patient slow perhaps less telemedicine. So all of these things in the market dynamics.

Create an opportunity to further penetrates our prescriber base and I think if you look at.

Sort of longer term and historically <unk>.

Branded anti psychotic heavy as long growth trajectories as their prescriber base grows that their patient base grows.

So too does your business, though latuda <unk>.

I had been generating positive growth for for years, and we would expect the same per capita I'd, especially with our with our favorable product profile.

Now more near term one of the things that was really encouraging to us is.

The third quarter has summer seasonality and it fell on the backdrop of an overall market for oral anti psychotics that essentially saw no growth during the quarter.

Capital Ida was able to drive 26% quarter over quarter growth.

And even more encouraging is now that we're past the summer months and we are into the fall.

<unk> returned to work students go back to school we're.

We're seeing renewed branded market growth.

And we expect that to continue in the fourth quarter and with that market growth. We also expect capital Ida growth to accelerate as we continue to gain market share in that market. So reflective of that in my in my comments prepared remarks, if you look at the last six weeks essentially after the labor day holiday.

We've seen week over week increases in capital I'd a prescription.

And I think Andrew what's what's driving that we continue to get very favorable feedback on the clinical data in the early patient experience that physicians are having.

And we continue to increase our brand awareness our sales force continues to penetrate this large prescriber base branded anti psychotics.

We're very pleased with the attendance and the reception.

To the information presented at our medical education programs.

And we're also pleased with our DTC campaign, and we expect to initiate a second campaign.

In 2023, which will further drive brand awareness in and contribute to growth. So.

A little bit of a long winded answer, but we I'd say, we're very confident in our ability to continue to drive robust growth through the end of this year and and while at the next year and beyond.

Very clear thanks, and May I ask a follow up question about next features.

Sure.

Thanks, just because it's right around the corner. So you know as we think about this topline released would you consider breaking out the efficacy data by subgroup within that for instance, Bpd makes feature subgroup and Mbd's Outgroup and then secondly.

The overall result is the kind of quote unquote bar two points versus placebo for success. Thank you.

So I'll I'll start and then I'll ask.

<unk> anything to add anything so first of all.

Huh.

Will tell you more as we get closer to the date.

Of topline results. So I think right now where we can't give you any of those specifics.

So I would I would say just stay tuned on that as to what you're looking for yeah. Typically you look for two to four points.

And in a in this case you would be looking to the lower end.

Especially in.

In these areas. So the rash do you want to add anything to that.

Hi, again, just like you.

Emphasize that the primary endpoint you'd have to be fixed.

M C G I N.

Seek any unresolved second degree.

We all started playing the patient.

Nine and.

And as you said, we will be doing.

79 out of it that are being planned and we're going to do just one thing I don't forget.

Thanks, very clear congrats again.

Okay. Thank you one moment for questions.

Our next question.

<unk> comes from Brian Abrahams with RBC capital markets you May proceed.

Hi, I'd lean it on for Brian . Thanks for taking our question I wanted to also ask on the commercial performance I guess can't talk about what you're thinking on how to best continued to add that next incremental patient to a prescriber who is already using capsulitis cause. It's just really a matter of time or other issues you're educating stops.

I don't know I guess, you know what I'm thinking is when whenever.

Doctors, considering using have plenty to versus another brand. It I guess what are the top factors there thinking about an hour you're working to get kept light it'd be top of mind for them.

Yeah surely.

Yep I'll take that and yeah. It's I I think it is a matter of time limited as as.

As physicians become more and more aware of capital Ida.

As they gain more and more patient experience with capital Ida in that patient experience comes back in a positive way and that's the feedback that we've been getting.

Early on in the launch it's critical that when physicians try your product and patients try your product that they have a positive experience and all of the early patient experience and feedback that we've been getting on that.

Has been highly positive and as R. As our sample size. If you will grows of increasing prescribers of increasing patient <unk>.

Positive feedback we continue to get just reinforces our beliefs.

Growth prospects for the brand in.

In the future.

And I think.

All it all comes down to the product profile on the performance of that product and so certainly.

Efficacy safety and dosing convenience our top factors.

When physicians decide what the prescribed and with cap lighter and bipolar depression.

We think we have a very favorable profile with proven efficacy and both bipolar one and bipolar too has mono therapy and his adjunctive therapy.

We have a very favorable safety and tolerability profile across both metabolic parameters as well as EPS and movement disorders.

Essentially all comparable placebo.

And we have a medication that's once a day with no titration required all of these attributes of the brand are viewed highly favorably by physicians.

And again the good news is the feedback that we get is the experience that their patients are having is consistent with the data and the results. We saw it in the clinical trial and that's always a very positive thing so.

We continue to increase our brand awareness across all of our marketing mix with our salesforce efforts or medical education and on the consumer side, increasing awareness and educating patients on bipolar depression.

And looking to have patience ask their physicians if kept light it would be appropriate for them. So all of these things work together to allow us to continue to drive again, both increased breath prescribing.

You are asking increased depth of prescribing by prescribers as well.

So it was very helpful. Thank you.

Thank you one moment for questions.

Our next question comes from Romero Hot with Evercore you May proceed.

Hi, guys. This is Mike you, Sherry and for whom or congrats on the quarter and thanks. So much for taking my question to for me Ah ones regarding mixed features given that around you said 30 per cent of bipolar and unitholder presentations have mixed features.

What proportion of them are already being treated for these conditions, albeit suboptimal Lee and if a patient with bipolar depression presents with myths features wouldn't they be covered by taking capsulitis. It has already indicated for this for bipolar depression and.

If this is true we wouldn't be incremental opportunity just be patients who've, given up or have dropped out of treatment because nothing works and follow.

Follow up question is just regarding your mixed features subgroup analysis from study four O four.

You used wymore is greater than four as a proxy for mixed features.

Is this a reasonable proxy and have other.

And a psychotic she used as proxies for mixed features in the past.

<unk>. So so thanks for the questions and it's a two part question, which has both a commercial aspect to it as well as a clinical aspect.

Asks the rash to start with and I don't know if you want to start Suresh with the why we used whiners.

Alright come out in our study and what is.

What is conventional to use and then.

Well it goes and then if patients are being treated right now in bipolar depression and and my last.

Mark could talk a little bit about the commercial.

Benefit.

Being on late.

Okay. So okay. So actually wanted start right, yes, I can.

First coming to the question of about using Y a modest before.

<unk> as a proxy for mixed features.

This has been used in seven retrospective analysis done.

A few of the antipsychotic wherever you.

The same.

Same method.

Approximating that anybody who has has caught up.

Mainly auditing scale and many other things scale of more than four.

It would be considered as having next features.

And then our second complications with other antipsychotic, which I've used the same.

Same same.

Playing with an allergy and we didn't deviate from this methodology be warned about the keep it similar to what others have done in the field.

And also in the field. This is considered a reasonable approach.

We have taken.

In terms of the.

Patients that have already been prescribed that is.

Cause that makes them that is true because.

For the bipolar Depression studies.

That is non specified included in our labor. So all patients all the subspace fast could be a small certifications in each of those.

Indications that have become part of the trials, but since these are difficult to treat patients. Because this subset is very difficult to sleep because they have high comorbidities that as a reference hydrocodone today, they have highschool, settling and suicidal ideation, Arizona suicide attempts.

Also they have difficulty.

And getting I'd also had difficulty with the highly recommend bricks and difficult to sleep, having this specific indication of the labor.

Promote and talk to the prescribed with about this.

And maybe I could ask Mark do you want to follow on that as to why from a commercial perspective.

The benefits of having.

Having an expansion of the label.

Yeah, sure and I'll.

I'll pick up where Suresh left off Mike and specifically.

<unk> said it would be covered on the bipolar side of it will be covered by the general bipolar abroad bipolar indication that we have but I wouldn't underestimate the value and impact of being able to have clinical data specifically in a patient population with mixed features in bipolar depression, so that the.

Physician.

Can see in that patient type the efficacy and safety of a medicine like capital Ida and that provides additional confidence that position.

To write a prescription for capital Ida and a patient specifically with bipolar depression and mixed features and certainly inclusion in the label allows promotion on the commercial side.

Which is also a powerful level of flower for us and then certainly the NBD component of this.

With an indication there would also be an expansion of the label there. So I hope that hope that makes sense, but we do see this as a real opportunity to have specific clinical data.

In this patient subsets.

Thank you one moment for questions.

Our next question comes from Charles Duncan was cancelled and you May proceed.

Super Good morning, Sharon and team congratulations on a very strong corner as well as four O three enrollment update thanks for taking our questions I had one commercial actually multipart commercial and then one pipeline.

To follow up regarding commercial question I'm, just wondering perhaps from Mark if he could speak to the profile driving persistence levels or would you think that new growth or growth would come more from new patients are longer term.

On drugs and then for Larry was there any pricing change in the corridor.

Okay.

So I'm happy to start I'll actually Larry can go first and to address it to him. It's a very short answer.

No we didn't razor change prices ankle yeah, we had no pricing yeah. Okay. So now for the longer answer [laughter].

Mark [laughter]. Please go ahead and.

Charles question is about the future.

Future growth and will it be driven by a new patient starts or or continuing strong persistent C and the answer Charles.

We continued to drive very strong new patient acquisition.

Particularly with a bipolar depression indication and we expect that to continue.

In the future and as we've talked in the past about the <unk>.

Favorable product profile of cap lighter.

Ashley with its safety and Tolerability attribute.

These are aspects of the profile that we believe contributes to a very strong compliance and persistence.

And we expect that certainly to continue as well so long answer but.

We do expect though.

In tribute to growth.

I think we also get comments on the ease of use so effective dose sundae one.

And so do you think that's beneficial.

And.

We've had other <unk> that we don't have any off target.

Side effects that.

Some of the anti psychotic task, so I think that again, the overall positive impressions.

From patients and physicians, it's very encouraging to us towards continued growth.

Thank you and as a reminder, please limit yourself to one question.

Our next question comes from Mark Goodman would sbb's.

Security.

You May proceed.

Yes, good morning, Larry a lot of parents discussion some sure have already taken place for next year can you give us a sense of gross to that's into next year, whether we should be thinking there'll be.

Any real change from the from the way that we've seen it pretty much all year. This year and I guess that includes you know bipolar depression pretty much dominating the prescription the new prescriptions.

And so just curious about that and and it just seems like spending is coming in a little light you know just later than we thought later than you guys. Just curious if that's just a seasonal thing and fourth quarters kind of make up for that and how we should think about spending the next year given.

You talked about the T C.

Sure well I as I've previously guided everyone.

And that's in the low thirties, we haven't really projected for next year, we're working on that now and we're looking at the contracting and so forth. So.

And our next earnings call will be will be ready to update you on the gross and that you know it changes if any there there'll be so unfortunate I can't give you that information now as far as the spending I think we're right on target for what we had had projected for the for the year, we said we'd spend $500 million in operations.

Cost of sales through the first nine months, we spent 370 and then we will [noise] excuse.

Excuse me expect to spend 130 in the fourth quarter, which is pretty much.

Yes, rather radical spending and and you know for the quarter and for the year. So I don't I'm not sure where we're late I think we're right right on target, but if you have a specific question I'd be happy to to the dive a little deeper if you like.

Thank you one moment for our next question.

Okay.

Our next question comes from David I'm someone with Piper Sandler and you May proceed.

Thanks, So apologize if you may have addressed this earlier in the in the queue and I jumped on labor.

Get your thoughts longer term regarding the muscarinic agonists and schizophrenia and and specifically.

The extent to which you sink it could be disruptive to capitalize those longer term trajectory or not just wanted to get your thoughts on.

That might change competitive dynamic how that even could impact paired dynamics over the long term again bearing in mind that this has schizophrenia limited, but wanted to get your thoughts Sir Thank you.

Thanks, I'll start nine all asks rash it from a clinical perspective, he wants to add anything so.

Any as I said before.

Any drugs that can help patients.

Is great for patients.

And you know.

We're pleased to see.

More drugs to be available for patients I would tell you as you said this is for schizophrenia only at the moment and I think that I danced at an hour while we are increasing.

An hour schizophrenia activity I think we are moving more.

Towards the trajectory in the <unk> in the mood disorder space as we said.

I think.

As you know these patients cycles through drugs.

So we've seen many ways.

In a psychotic come to market come to then turned to be generic et cetera and.

Anytime there are these entrance they really haven't affected negatively.

To the product the branded products that are on the market. So we would welcome new entrants.

We don't believe that it will have a negative impact on kept lighter.

Revenues at all and if we expand the market by having more players.

That would be great too.

Thank you one moment for our next question.

Our next question comes from.

So <unk> with Mizuho you May proceed.

[noise] Hey, good morning. Thanks, so much for taking my question and congrats on a great third quarter.

I do ask perhaps a bigger picture question around profitability.

And the company's view or philosophy around and profitability visa V. It's desire to invest in commercial and R&D you know aspirations for the company in other words, how are you trying to balance the two thanks.

I'll ask Larry to take that understanding for awhile, though that we haven't given you.

Any forward looking guidance.

Yeah, right, we haven't given forward looking guidance I mean I I.

We we have given expense guidance and 20 twenty-two we are critically looking at our spend going forward. We are we are positioning herself towards profitability Ah, but again, that's obviously dependent upon the trajectory sales, which we believe is going to be very strong. So.

Would that give any specifics I mean, our goal is to get the profitability, we keep our spending under control. We look at all of our you know our projects and.

Development programs critically and.

Our goal is to become profitable as soon as we can.

Thank you one moment for our next question.

Our next question comes from Jason go very with Bank of America and you May proceed.

Hi, This is Perry on the line for Jason Thanks for taking our question just a quick follow up on selling and selling and marketing spend.

Should of getting giving guidance how're you seeing.

Selling and marketing spend it evolved with next year I'd imagine with meaningful discretionary DPC spend the question is whether that's gonna be your current more of a one time investment that you might go back over time and then.

Another question on the NBC adjunct indications. So can you speak to the upcoming pre law are produced and Postmarketing MBV indication I guess in terms of MBV adjunct if the F. D. A requires too positive phase twos.

Threes.

First you think calculated needs to hit on both M. D D phase threes or you know in the event that that's there's a split of the phase threes would mix feature or the previous favorable BBB data still provide support for a second pivotal.

Thanks.

Okay. Thanks for.

Those.

Questions I'm not sure I got all of them, but the first one I think went to Larry about.

Is this is.

Is our commercial.

Spend et cetera, one time or do we expect to continue.

Did you want me to take that or you Wanna take it man why don't you go ahead [laughter] Yeah, Yeah sure sure obviously, we have on our commercial.

Herschel side, we have you know various means that were promoting our product. We you know different mediums and so forth and and we gauge the effectiveness in our gauging the effectiveness of those interest in going forward with it.

We're gonna have those same programs and you know we're working on the mix of the of the spending amongst the program. So I would say our spending in this line is pretty we've given you guidance for this year and it's been pretty straight on and and we're looking at you know our spend now in the budgeting process. So if we find opportunity.

These that can increase our trajectory, we're certainly take those and so that that would be spent that would be in the right in the right direction, we're not going to refurbish frivolously spend you know the.

And take chances, but I think we're really going to be focusing on what we're doing right and I think mark alluded to the to the things that we're looking at for next year to drive sales. So I think we're in good shape with our spending patterns. If you will.

And as we said in our prepared remarks, we continue to invest in the business.

As we move forward. So I think you can expect to continue to see the spending.

In our business.

In order to continue the trajectory that we're on tour.

<unk>.

And then to the question of.

Many studies do you need et cetera, I think it really depends on how the data looks okay. If ye two overwhelmingly positive studies.

You know, it's a home run.

Last year very close that's another question I think it's always going to be a discussion with the F. D. A is one is.

It it really depends on the outcome of the study and as to whether it be poodle to have another study I think we constantly evaluate.

Ah the opportunities and so stay tuned continuously evaluate these things.

Thank you one moment for our next question.

Our next question comes from if audio is need them you May proceed.

Good morning.

The nice corner I had a question about your comment around.

Acceleration into the fourth quarter you talked about.

<unk> and the recently.

Gimme more broadly discuss your expectations, Ron How're you see.

The <unk>.

For the next couple of months.

Do you see that excavating further from here.

That would be helpful. And then you know it's the end of 2023.

What are your thoughts on providing guidance four.

Or apply to for next year. Thank you.

So Mark you Wanna take the first part and I'll take the.

I can do the last part right now.

Okay Mccarthy salaries being exactly when will start, giving guy, but I I think so.

By our next earnings call, we will have decided the appropriate times to start giving you guidance, but at the moment, we don't have that answer for you, but we're looking at it very closely we know that you're.

You're extremely interested in such metrics, so state I hate to say it again, but stay tuned.

And Mark you Wanna take the first part of the question.

Yeah sure. Thanks for your question I would say we were we were very pleased with the 26%.

Prescription growth in the third quarter on the backdrop of a market during the summer months that had zero growth in it which reflects the fact that we were able to continue to drive market share and continued to penetrate.

The prescriber based.

To drive that growth now as we come out of the summer months, where you have this summer seasonality, we do expect and we've actually seen signs of the branded market <unk>.

Growing in the fourth quarter, where it was more flat during the third quarter, which is a positive thing. So we'll have some some tailwinds behind and in addition to that additional market share gains in the fourth quarter should accelerate our growth in the fourth quarter versus the the third quarter, So again, where.

We feel confident that we will continue to experience a robust growth.

And then an accelerating cashing in the fourth corner.

Thank you one moment for our next question.

Operator, we're gonna have to be wrapping this up that says I mean, it. It's 930, maybe if there's one more question.

Sounds good our last question comes from Ash, Vermont would you be S. You May proceed.

Hi, Thanks for putting me in so let me see that'd be kept lyda N. B <unk> has been strong consistently in this antipsychotic <unk> like how much time does it take for the T. R X R and I make sure to start to track of the same level as the N <unk> N B R X sure. If you can comment on that.

Mark you address.

Yeah sure Slash Yeah, we have been pleased with our new patient acquisition, which is what NBER X is reflective of and as I mentioned in my prepared remarks.

The weekly levels of new to brand prescriptions for cap light are now it's five times, what they work prior to the.

Label expansion into bipolar depression, and I think <unk> is the driver so NBER X results in higher new prescriptions at our ex and those new prescription result in higher tier acts and then obviously as you're adding.

New patients all the time weekly monthly quarterly those patients combined with the compliance and persistency profile for capital Ida is.

What drives the total prescription line and if you look at the trajectory of our T. R X lines.

We've been very pleased with the continued significant growth that we've seen there and we expect that to to continue into the fourth quarter and into the future years as well.

Great.

Well in the interest of time I want to thank everybody for participating today and we are very pleased with the growth.

That we're seeing in the trajectory.

Of growth that we're seeing for cap lighter as well as as we advance our other programs poster label expansion for capital Ida as well as other programs.

We look forward to updating you on our next call.

And with that and we're very pleased with the growth in our company as well so with that I would say operator, you can now disconnect. Thank you.

Thank you. This concludes today's conference call. Thank you for participating you may now disconnect.

[noise].

[music].

[music].

[music].

Good morning, ladies and gentlemen, and welcome to intra cellular therapies third quarter earnings call. At this time all participants are in a listen only mode. After the speaker presentation there'll be a question and answer session to ask a question. During this session you will need to press star one one on your telephone please limit yourself to one or two.

Two questions as a reminder, today's conference call is being recorded I would now like to turn the conference over to Dr. Juan Sanchez, Vice President corporate Communications and Investor Relations.

Good morning, and thank you all for joining us on the call today.

Our earnings press release provide corporate update.

Details of the company's financial results for the third quarter.

<unk> 2022.

This press release closer to work.

This morning, and is available on our website at intra cellular therapies dot com.

Joining me on the call today are Dr. Sharron, <unk>, Chairman and Chief Executive Officer, Mark Newman Executive Vice President and Chief Commercial Officer Dr.

Northern.

Executive Vice President and Chief Medical Officer.

Larry Hyland senior Vice.

It didn't and Chief financial Officer.

As a reminder, during today's call, we will be making certain forward looking statements.

These statements May include statements regarding among other things.

Efficacy safety safety unintended use of the company's product development candidates, our clinical and non clinical plans our plans to present and report additional data the aunt.

Dissipated conduct and results of Hong Kong in future clinical trials.

Plans regarding regulatory filings.

Research and development, our plans and expectations regarding the commercialization of <unk> potential impact of COVID-19 pandemic on our business.

Possible uses of existing cash and investment resources.

These forward looking statements are based on current information assumptions and expectations.

Which are subject to change and involve a number of risks and uncertainties that may cause actual results to differ materially from those contained in the forward looking statements.

These and other risks are discussed in our periodic filings made with the Securities and Exchange Commission, including our quarterly and annual reports.

Youre cautioned not to place did not to place undue reliance on these forward looking statements.

And the company disclaims any obligation to base such agreements.

I will now turn the call over to Shannon.

Thanks, Warren good morning, everyone I'm excited to be here today to share our third quarter results, including our ongoing success with kept lightest launch in bipolar one and bipolar depression I will also share our progress on our pipeline.

Following my remarks, Mark will elaborate on our commercial progress and Larry will provide details on our national performance. We will then open the call for questions.

We are pleased with the continued performance of kept lighter and this quarter. We are reporting robust net product revenues of $71 $9 million.

This represents a 233% increase over the same period in 2021, and a sequential increase of 30% over the second quarter 2022.

The fundamental growth indicators for kept lighter are strong we.

We are making appropriate investments in our business to maximize the full potential of this important medicine and are highly confident in our continued growth.

The acceleration and kept lightest uptake following our label expansion in bipolar disorder to our indication of schizophrenia confirms the continued medical need in these disorders and the value kept light it brings to patients.

We are excited to see the acceleration in our bipolar prescriptions as these disorders are four to five times more prevalent than schizophrenia.

Kept lightest proven efficacy is combined with a favorable safety and tolerability profile and ease of administration with once a day dosing and no titration needed.

In clinical trials changes in key safety metrics, including weight change fasting glucose total cholesterol and triglyceride, where all similar to placebo.

In addition limits have grown uniquely interact with the dopamine system.

Clinical trials dopaminergic adverse events, such as movement disturbances, including Akathisia were not comment and were similar to placebo.

We continue to receive positive feedback from healthcare providers and patients on cap lighter in the real world setting with clinical experience consistent to those observed in our clinical trials.

We continue to invest in clinical programs to develop kept light us for broader patient populations, including mood disorders.

Mood disorders are highly prevalent there are more than 11 million people in the U S living with bipolar disorder. In addition, more than 20 million Americans experience Uni polar depression referred to as major depressive disorder or MDT pacing.

Patients with these disorders are often highly functional and are significantly involved in their treatment decisions.

It is important to highlight that the majority of these patients are not adequately treated with initial therapies.

There are only a few FDA approved anti psychotic treatment options for these conditions and patients need options for treatment with proven efficacy and favorable safety profile.

Major anti psychotic brands have achieved commercial success, primarily as a result of their mood disorder approval.

<unk> in the uptake of these drugs in populations with large numbers of patients.

This is proving true with kept lighter than an increasingly larger portion of prescriptions coming from bipolar depression.

<unk> is the first and only anti psychotic approved for the treatment of bipolar one or bipolar depression, and adults as monotherapy and adjunctive therapy with lithium or valproate.

Expect continued growth in bipolar depression, and schizophrenia as we continue to pursue additional label expansion opportunities.

We have a pivotal program evaluating <unk> as an adjunctive therapy to antidepressants for the treatment of MD in those patients who have had inadequate response to anti depressant patient.

Patient enrollment is ongoing in studies <unk>, one and 502, our global Phase III <unk> studies evaluating <unk> 42 milligrams for the adjunctive treatment of depression.

The primary endpoint is changed from baseline on the Majerus total score at week six.

In addition to the efficacy study we have an ongoing long term open label rollover study to further assess safety in this patient population patient.

Patient enrollment is in line with our expectations.

We expect to file a supplemental new drug application with the FDA for approval of <unk> as an adjunctive therapy to antidepressants for the treatment of <unk> in 2024.

We have a great deal of confidence in our M. D. D program, the depressive episodes within MDT and bipolar disorder has the same characteristics and we measure the depressive episodes with the same scale. The majerus total score and both MVD and bipolar disorder.

Positive results from our bipolar depression studies and the robust evidence coming from the demonstration of efficacy in these studies coupled with the positive real life feedback we received on patients with bipolar depression being treated with cap later gives us further confidence for our ongoing programs in mood disorders.

We are also evaluating <unk> in patients with MVD or bipolar depression, who exhibit mixed features.

We are pleased to announce we recently completed patient enrollment in study four O three and expect to report topline results in the first quarter of 2023.

Study 403 is a well controlled global clinical trial evaluating <unk> 42 milligrams as monotherapy in patients with Mg D or bipolar disorder, who exhibit mixed features during their current depressive episode.

Efficacy is assessed at week six and there is a follow up safety visit two weeks after the last medication dose.

Primary endpoint of this study is changed from baseline versus placebo on the Majerus total score at week six and the secondary endpoint is the change from baseline on the CGI S.

Our confidence in this program is in part guided by our previous studies. We have conducted a retrospective analysis of study 404 evaluating the antidepressant effects of Luna test Brown in a subgroup of bipolar depression patients meeting the criteria for mixed features at baseline.

And this analysis <unk> had robust anti depressant effect as measured at week six by the Majerus total score at the CGI.

Just to remind you the mixed feature specifier in the DSM five highlights an important group of patients with MTT and bipolar depression.

<unk> patients experience a major depressive episode.

<unk> can be accompanied by sub threshold manic or hypomanic symptoms.

25% to 40% of patients experienced these symptoms, which often correlates with a worst disease prognosis. These patients have more severe illness, and higher recurrence rate comorbidities and rates of suicide and suicidal ideation.

<unk> patients with mixed features respond poorly to antidepressants and are at higher risk of developing bipolar disorder.

Our no approved MTV or bipolar depression medicine that include this important specifier in their label.

We believe lumens pepper on safety and Tolerability make it a strong treatment option for these patients and we look forward to sharing the topline results from study 403 with you.

Turning to our ongoing in the tougher on long acting injectable program. Our goal with this program is to develop a long acting injectable formulations of <unk> that are effective safe and well tolerated and last one months and longer.

We have conducted a phase one single ascending dose study with our first formulation. This study evaluated the pharmacokinetics safety and Tolerability of <unk> long acting injectable in patients with stable symptoms of schizophrenia.

We have also explored alternate site of injection with this formulation and we have been progressing additional formulations.

We are finishing the analysis of these studies and will enable us to define the next steps in this program.

We expect to provide an update on this program on our next call.

Let me provide a brief summary of our other clinical trial activity starting with human capital.

We are conducting a relapse prevention study in patients with schizophrenia and expect patient enrollment to complete in late 2023.

The timing of data release will depend on the rate of relapse in the trial, we will update you as the trial progresses.

We recently completed several looming around phase one studies, including a study evaluating the PK safety and Tolerability profile in pediatric patients with schizophrenia.

This study demonstrated that <unk> is generally safe and well tolerated in this patient population and patients achieve comparable drug levels to the adult population with 42 milligram <unk>.

Other early stage trials with <unk> are ongoing workplace.

Turning to $12 84, or <unk> form of them wrong, a new chemical entity formulated as an oral disintegrating tablet for Sublingual administration. We recently completed a food intake study. This study demonstrated that <unk> had no significant impact on the PK profile.

We expect <unk> 12, 84 can be given with or without food.

We've also completed phase one safety studies, demonstrating ITI 12, 84 is safe and generally well tolerated in normal healthy volunteers and normal healthy elderly volunteers.

Other phase one studies are ongoing or planned and include drug drug interaction studies in mass balance studies.

We also continued to progress our toxicology program.

We.

Back to commence clinical conduct in phase II clinical trials and agitation in patients with probable Alzheimer's disease, and dementia related psychosis and certain other disorders in 2023.

And our PD one inhibitor program, we recently completed or have ongoing phase one trials with our lead molecule lends potent including drug drug interaction bioavailability from scale up batches and food effect study.

Our ITI Triple III program for opioid use disorder and pain is also progressing well.

We have completed a single ascending dose study and our neuro imaging study is ongoing.

The objective of this study is to investigate bringing occupancy target receptors play a role in these conditions.

Following our neuro imaging studies, which will help determine the dose selection for future studies, we plan to initiate a multiple ascending dose study.

The progress being made across our program underscores our commitment to invest in the building blocks for our long term growth.

We ended the quarter in a strong financial position with $635 million in cash cash equivalents and investment securities we have no debt.

This kept lighter and our pipeline of promising new treatments, we continued to fulfill our mission to develop safe effective and innovative medicines that improve the lives of patients with neuropsychiatric and neurologic disorders.

<unk> had a very strong quarter and we are confident in the continuation of kept lightest growth momentum throughout next year and years to come.

I will now turn the call over to Mark will provide additional information on kept lightest commercial performance Mark.

Okay.

Thanks, Sharon and good morning, everyone.

The blood is launching bipolar depression continues to go very well.

Our launch fundamentals are strong across all commercial metrics and we remain confident that capital either will experience continued robust growth.

During the third quarter FY. The total prescriptions grew 26% sequentially versus the second quarter of 2022.

And 220% year over year versus the third quarter of 2021.

<unk> growth this quarter is particularly impressive considering the impact of summer seasonality that saw the overall oral antipsychotic market registering no growth for the quarter.

We expect the market to return to growth in Q4, and with that a further acceleration in cap lighter prescription growth to close out the year in fact capital items posted week over week increases in total prescriptions and five of the last six weeks.

Looking at the longer term trends, while our schizophrenia franchise continues to grow nicely <unk> has experienced substantial growth in the first nine months following our launch in bipolar depression.

Since launch new prescriptions have tripled.

And weekly new patient starts are at levels five times higher than they were prior to our label expansion.

We are encouraged with capitalized uptake across a broad range of patients with bipolar depression and <unk>.

System with our approved indications.

As Sharon mentioned, an increasing proportion of prescriptions are coming from bipolar depression.

Bipolar depression already accounts for the largest share of both new patient starts and total patient.

Satellite is compelling profile is resonating well with prescribers.

Applied is the only anti psychotic with proven efficacy in adults with both bipolar one and bipolar depression, as monotherapy and adjunctive therapy with lithium or Valproate.

It has a favorable safety and tolerability profile with weight metabolic changes EPS and akathisia, all similar to placebo.

<unk> is a once a day medication that does not need titration and can be taken with or without food.

These are powerful reasons to prescribed.

They apply to market access coverage remains very strong.

Coverage in the Medicare part D and Medicaid channels remains greater than 98% and.

And we have approximately 85% coverage in the commercial channel.

In addition, <unk>.

<unk> is lighter link patient and prescriber support programs continue to be very effective at addressing coverage and reimbursement processes.

And overall patient affordability where appropriate.

Our broad market access and commercial efforts, including sales activity and well attended medical education events.

Combined with capitalized favorable profile are driving the robust uptake in prescriptions.

In mid August we introduced two new dosage strength with satellite for use in special populations.

Those with hepatic impairment and those concomitantly, taking CYP three <unk> four inhibitors.

Launch of these doses makes capital either available to a broader population of patients living with bipolar depression as well as schizophrenia.

In summary, we are very pleased with tablet is strong growth and we are making the appropriate investments to ensure continued commercial success.

We are very confident in our ability to drive long term value creation, and we continue to work with healthcare providers to help patients with bipolar depression and schizophrenia.

I will now turn the call over to Larry Larry.

Thank you Mark I will provide a summary of our financial results for the third quarter ending September 32022.

Total revenues in the third quarter grew to $71 9 million compared.

Compared to $22 $2 million in the third quarter of 2021.

In the third quarter, we recorded net product revenue of capital item of $71 9 million.

Compared to $21 6 million for the same period in 2021, and $55 1 million in the.

Quarter of 2022.

This represents a year over year increase of 233% and a 30% increase over the second quarter of 2022.

In the third quarter, our gross to net adjustment percentage remained in the low thirties consistent with our previously communicated guidance. We expect the gross to net percentage for the fourth quarter to remain in the low <unk> inventory.

Inventory levels in the trade measured by days on hand of capitalized at the wholesaler level remained consistent throughout the third quarter in line with historical and expected levels.

Cost of product sales were $5 $9 million in the third quarter of 2022 compared to $2 million from the same period in 2021.

Selling general and administrative expenses were $88 $4 million from the third quarter of 2022 compared to $75 million for the same period in 2021.

This increase is primarily due to an increase in marketing and advertising expenses and labor related costs.

Research and development expenses for the third quarter of 2022 were $33 3 million compared to $27 million for the third quarter of 2021.

This increase was due to higher lunar lunar <unk> clinical trial in non clinical related costs and an increase in non lunar tepper own program cost.

Net loss for the third quarter of 2022 was $53 5 million compared to a net loss of $76 9 million for the third quarter of 2021.

Cash cash equivalents restricted cash and investment securities totaled $635 million at September 32022, compared to $413 7 million at December .

31 2021.

In January 2022, we completed a $460 million public offering resulting in net proceeds to the company of approximately approximately $433 $7 million.

This concludes our prepared remarks, operator, please open the line for questions.

Thank you as a reminder to ask a question you will need to press star one on your telephone please standby, while we compile the Q&A roster.

Our first question comes from Jessica Fye with Jpmorgan you May proceed.

Hey, guys. This is Nick on for Jessica Thanks for taking our questions.

With data for mixed feature study you expect any <unk> hundred 23, how should we be thinking about good data for the benchmark and when that data reads out what level of read across.

You see in the <unk> 501 in private two studies. Thanks.

So thanks for the question and Thrasher I'll ask you to start maybe.

Maybe you want to start with the second part of your question Amit.

No.

What do you think about a read through.

Between MDT and mixed features.

Bipolar features and then we'll go from there.

Okay.

Thank you for the question.

Got it.

The mixed features and objective feedback and BD.

On a different patient population.

<unk> studies.

Next the Gist population study is a monotherapy study.

And Jim.

And I think that you'd mentioned partnering with Wanda.

Jason.

Yes.

To be more difficult to sleep mode.

Yes.

Quite a different today.

And how high Comorbidities.

And I'll just take a big basin.

Having said that we are optimistic about this program given the data that we have.

Our retrospective analysis of study protocol.

Regarding the antidepressant effects up limit capital in the subgroup of bipolar depression patients.

The criteria for mixed because had we applied.

In this analysis.

Limited, but don't have robust antidepressant effect.

And.

These patients are difficult to sleep and right now.

No treatment available at this time.

Hi.

Okay.

Okay.

Enabled indications are mixed feature.

And the bad part about this.

He is.

Is not laid out the Expo.

Yes.

During the study and have not been so far any studies at <unk>.

Hi.

In terms of getting an approval for this.

But I think the treatment of NBD.

There is a path already laid out that a few bucks.

<unk> already approved.

I think the statement. However, there is still room for improvement in terms of the safety profile of the compounds.

Mechanistically.

You can look at is look strong in terms of the five <unk> antagonism.

And we have taken division and also the indirect FX.

Indirect FX it'd be one which acts through an MBA and Empire is the best.

In addition, our bipolar depression program, both as monotherapy as well as I think the statement. We have shown that <unk> has shown significant improvement in deposit symptoms.

In addition, schizophrenia trials.

We have also shown that.

A subset of patients who have been.

Depression and on antidepressants.

Antidepressant and also those patients who have not attended both showed significant improvement in depressive symptoms.

In essence, I would say that that these two are different population and I would.

See them as independent studies, not making any deadlines, but one way or the other.

Okay. Thank you.

Thank you one moment for questions.

Our next question comes from Andrew Tsai with Jefferies. You May proceed.

Alright, Thanks, and good morning, Congrats on another great quarter and nice job on the execution.

I guess my question is around type lattice trajectory over the next six to 12 months.

As you think about the acceleration what would be the specific drivers in terms of increasing demand and growing market penetration and what I guess specific leading indicators will you be looking at.

To give you that type of confidence thanks.

Great Hi, Andrew.

Thanks for the questions.

Mark would you like to take that.

Yes, sure. Thanks, Andrea and yes, we do we continue to see very strong underlying demand in the marketplace for cap light as.

As well as increasing prescriber adoption, both in terms of breadth of prescribing, adding <unk>.

Significantly more new prescribers to capital Ida as well as existing prescribers, increasing their depth of prescribing in both of those indicators are very positive to us I think.

What I would say is we're highly confident that capital light I will continue to experience the kind of robust growth that we've seen in.

In the first three quarters of launch and there are several reasons for that first and foremost we continue to have the potential to significantly increase our prescriber base. We are pleased with our prescriber reach to date and the growth that you've seen over the last several quarters.

But we're still early in the launch and we have a significant additional prescriber pool that we expect to access in the coming months.

That environment continues to stabilize.

That will improve our ability to access providers and increased patient flow, perhaps less telemedicine. So all of these things in the market dynamics create.

Create an opportunity to further penetrate our prescriber base and I think if you look at.

Sort of longer term and historically.

<unk> anti Psychotics have these long growth trajectories as their prescriber base grows that their patient base grows.

So too does your business <unk>.

We have been generating positive growth for years that we would expect the same for capital light, especially with our with our favorable product profile.

Now more near term one of the things that was really encouraging to us is.

The third quarter has.

Summer seasonality in it so on the backdrop of an overall market.

Our oral anti psychotics that essentially saw no growth during the quarter.

Capital Ita was able to drive 26% quarter over quarter growth.

And even more encouraging is now that we're past the summer months and we're into the fall.

People returned to work students go back to school.

Being renewed branded market growth and.

And we expect that to continue in the fourth quarter with that market growth. We also expect capital light growth to accelerate as we continue to gain market share in that market. So reflective of that in my in my comments prepared remarks, if you look at the last six weeks essentially after the labor day holiday.

We've seen week over week increases in capital light a prescription.

And I think Andrew what's what's driving that we continue to get very favorable feedback on the clinical data and the early patient experience that physicians are having.

And we continue to increase our brand awareness our sales force continues to penetrate this large prescriber base branded anti psychotics.

We're very pleased with the attendance and the reception.

The information presented in our medical education programs.

And we're also pleased with our DTC campaign, and we expect to initiate a second campaign.

In 2023, which will further drive brand awareness and contribute to growth. So.

Little bit of a long winded answer, but I would say, we're very confident in our ability to continue to drive robust growth through the end of this year and well into next year and beyond.

Very clear thanks, and May I ask a follow up question about next features.

Sure.

Thanks.

Just right around the corner.

So as we think about this topline release.

Would you consider breaking up the efficacy data by subgroup within for instance, Bpd makes feature subgroup and MDT subgroup.

And then secondly.

For the overall result is the kind of.

Bar two points versus placebo for success. Thank you.

Well I'll start and then I'll allow restaurants.

To add anything so far.

First of all.

<unk>.

We'll tell you more as we get closer to the date.

Topline results. So I think right now we can't give you any of those specifics.

So I would I would say just stay tuned on that as to what Youre looking for.

Typically.

You look for two to four points.

And in a in this case you would be looking to the lower end.

Especially.

In these areas. So Raj do you want to add anything to that.

Again, not just against.

Emphasize that the primary endpoint at week six Mega.

Scott and CGI.

Secondly.

We have started saying the patients.

His line.

And as you said, we will be doing Kevin and analysis that are being planned.

And we will go into the details once we I don't think you guys.

Thanks, very clear congrats again.

Thank you. Thank you one moment for questions.

Our next question comes from Brian Abrahams with RBC capital markets. You May proceed.

Hi, it's Leonid on for Brian Thanks for taking our question.

Wanted to also ask on the commercial performance.

I guess can you talk about what youre thinking on how to best continue to add that next incremental patient to a prescriber who is already using <unk> is it just really a matter of time or are there issues, you're educating docs and I guess, what I am.

Thinking is when went up.

<unk> is considering using can apply to versus another branded I guess what are the top factors, they're thinking about and how are you working to get calculated to be top of mind for them.

Yes surely.

Yes, I'll take that.

I think it is a matter of time.

As.

As physicians become more and more aware of capital either.

As they gain more and more patient experience with capital item that patient experience comes back in a positive way and that's the feedback that we've been getting.

Early on in the launch it's critical that when physicians try your product and patients to try your product that they have a positive experience and all of the early patient experience and feedback that we've been getting on that.

Has been highly positive and as our as our sample size. If you will grows of increasing prescribers and increasing patient.

The positive feedback we continue to get just reinforces our belief in the growth prospects for the brand in the future.

And I think.

It all it all comes down to the profit profile on the performance of that product and so certainly.

Because the safety and dosing convenience are top factors.

When physicians decide what to prescribe and with cap lighter and bipolar depression we.

I think we have a very favorable profile with proven efficacy in both bipolar one and bipolar two as monotherapy and adjunctive therapy.

A very favorable safety and tolerability profile across both metabolic parameters as well as EPS and movement disorders Sn.

Essentially all comparable to placebo and we have a medication. That's once a day with no titration required all of these attributes of the brand.

Our viewed highly favorably by physicians.

And again the good news is the feedback that we get is the experience that their patients are having is consistent with the data and the results. We saw in the clinical trial and Thats always a very positive thing so.

We continue to increase our brand awareness.

Across all of our marketing mix with our sales force efforts, our medical education and on the consumer side.

Increasing awareness and educating patients on bipolar depression.

And looking to have patients ask their physicians, if capitalize that would be appropriate for them. So all of these things worked together to.

Allow us to continue to drive again, both increased breadth of prescribing.

As you are asking increased depth of prescribing by prescribers as well.

That's very helpful. Thank you.

Thank you one moment for questions.

Our next question comes from Amir <unk> with Evercore you May proceed.

Hi, guys. This is Mike if you're already and for whom are congrats on the quarter and thanks. So much for taking my question. Two for me one is regarding mixed features.

Given that around you said, 30% of bipolar and unitholder presentations have mixed features.

What portion of them are already being treated for these conditions, albeit a sub optimally and if a patient with bipolar depression presents with mixed features wouldn't they be covered by taking capital out as <unk> already indicated for this for bipolar depression.

And if this is true wouldn't be incremental opportunity just be patients who have given up.

Where have dropped out of treatment because nothing works.

And my follow up question is just regarding your mixed features subgroup analysis from study 404.

You used why March was greater than four as a proxy for mixed features.

Is this a reasonable proxy and have other anti psychotics used this proxy for mixed features in the past. Thank you.

Hi, Mike.

So thanks for the questions and it's a two part question which has both.

Commercial aspect to it as well as a clinical aspect and I'll ask Suresh to start with and.

I don't know if you want to start Suresh with <unk>.

Why we used winders.

Alright.

In our study and what is.

What is conventional to use.

And then.

Will it go.

Then if patients are being treated right now in bipolar depression and.

And my last.

Uh huh.

Mark could talk a little bit about the commercial.

Benefit of being on label, Okay. So okay.

So as you want to start great, Yes again.

Coming to the question about using Hawaiian modest before.

About as a proxy for mixed features.

<unk> has been used.

In several retrospective analysis done.

A few other anti psychotics.

This is the same.

Same method.

Approximating that anybody who has this quarter.

Rating scale and many other things scale up more than four.

It would be considered as having mixed features.

And then our second obligations with other antipsychotic, which have used the same.

Same same.

Same methodology and we didn't deviate from this methodology would be wind also keep it similar to what others have done in the field.

And also in the field this is sensitive.

Annabelle approach.

What we have taken.

In terms of the.

Patients that are already being prescribed.

Because I mentioned that is true because.

For the bipolar Depression studies.

There is no specific items included in our label. So all patients all the subsequent fast could be a small set of patients in each of those.

Indications that have become part of the trials.

But since these are difficult to treat patients because this subset Admirative Cooper fleet, because they have high co morbidities that is recurrence hydrocodone today, they have heightened settle in and suicidal ideation as Sue said items.

Also they have difficulty.

And getting.

And also had difficulty with the highest record in Phoenix and difficult to treat having this specific indication in the label you can help us.

And talk to the type of a board.

And maybe I could ask Mark do you want to follow on that as to why.

From a commercial perspective.

The benefits of.

Having an expansion of the label.

Yes sure.

I'll pick up where suresh left off mic.

Specifically.

As rich said it would be covered on the bipolar side. It will be covered by the general bipolar abroad bipolar indication that we have but I wouldn't underestimate the value and impact of being able to have clinical data specifically in a patient population with mix features in bipolar depression, so that.

The physician.

Can see in that patient type the efficacy and safety of a medicine like capital Ida and that provides additional confidence that position.

To write a prescription for capital Ida patients, specifically with bipolar depression and mixed features and.

And certainly inclusion in the label allows promotion on the commercial side.

Which is also a powerful level lever for us and then certainly the MTBE component of this.

With an indication there would also be an expansion of the label there. So I hope that I hope that makes sense.

Do see this as.

A real opportunity to have specific clinical data.

In this patient subset.

Thank you in a moment for our questions.

Our next question comes from Charles Duncan with Cantor you May proceed.

Super Good morning, Sharon and team congratulations on a very strong quarter as well as four O three enrollment update.

Thanks for taking our questions I had one commercial actually multipart commercial and then one pipeline.

To follow up regarding commercial question I'm, just wondering perhaps from Mark if he could speak to the profile driving persistence levels or would you think that new growth or growth would come more from new patients or longer term on on drug and then.

For Larry was there any pricing change in the quarter.

Okay.

I'm happy to start well actually Larry can go first since you addressed it to him. It's a very short answer Larry sorry to answer no we didn't raise or change prices yes.

We had no price change yeah. Okay.

So now for the longer answer.

Mark.

Please go ahead.

Charles question is about.

Future growth and will it be driven by.

New patient starts or or continuing strong persistency and the answer Charlie is both.

We continue to drive very strong new patient acquisition, particularly.

Particularly with the bipolar depression indication and we expect that to continue.

The future.

And as we've talked in the past about the <unk>.

Favorable product profile of cap lighter, especially with its safety and Tolerability attributes.

These are aspects of the profile that we believe contributed to very strong compliance and persistency.

And we expect that certainly to continue as well so.

Long answer but.

We do expect both to contribute to growth.

I think we also get comments on the ease of use.

The effective dose on day one.

And so do you think.

That's beneficial.

And we've had other comp.

We don't have any off target.

Side effects.

That.

Some of the anti psychotic Chad so I think that.

Again, the overall positive impressions.

From patients and physicians.

It's very encouraging to us.

Towards continued growth.

Thank you and as a reminder, please limit yourself to one question.

Our next question comes from Marc Goodman with SBB.

Thank you.

<unk> you May proceed.

Yes, good morning, Larry.

Lot of payer discussions I'm sure I've already taken place for next year can you give us a sense of gross to nets into next year, whether we should be thinking there'll be any real change from the way that we've seen it pretty much all year. This year and I guess that includes bipolar depression pretty much dominating the prescription the new prescriptions.

And so just curious about that.

It seems like spending is coming in a little light just later than we thought later that you guys. Just curious if thats just a seasonal thing in fourth quarter is going to make up for that and how we should think about spending in the next year given you talked about DTC.

Sure well.

As I previously guided everyone.

Gross to net is in the low thirties, we havent really projected for next year, we're working on that now we're looking at contracting and so forth. So.

And our next earnings call, we'll be we'll be ready to update you on the gross to net.

As if any there there'll be so.

Unfortunate I can't give you that information now as far as the spending I think we're right on target for what we had.

Had projected for the year, we said we'd spend 500.

On operations exclusive of cost of sales through the first nine months, we spent 370 and then.

Excuse me, we expect to spend $1 30 in the fourth quarter, which is pretty much.

Yes, ratable spending and for the quarter and for the year. So I don't I am not sure where we're light I think we're right right on target, but if you have a specific question I'd be happy to.

To dive a little deeper if you like.

Thank you one moment our next question.

Okay.

Our next question comes from David <unk> with Piper Sandler You May proceed.

Thanks, So apologize if you may have addressed this earlier in the Q&A I jumped on late but wanted to get your thoughts longer term.

Regarding the muscarinic agonists in schizophrenia, and and specifically the extent to which you think it could be disruptive to cap load is longer term trajectory or not just wanted to get your thoughts on that.

That might change competitive dynamics, how that even could impact payer dynamics over.

Over the long term again bearing in mind that this is schizophrenia limited, but wanted to get your thoughts there. Thank you.

Thanks, I'll start and then I'll ask Russia from a clinical perspective, he wants to add anything so.

Any as I've said before.

Any drugs that can help patients.

It is great for patients.

And.

We're pleased to see.

More jobs to be available for patients I would tell you as you said this is for schizophrenia only at the moment and.

I think that I don't.

While we are increasing.

Our schizophrenia activity.

I think we are moving more.

Towards the trajectory in the pipe and the mood disorder space as we've said.

I think.

As you know these patients cycle through drug.

So we've seen many ways.

<unk> come to market to them.

Then turn to be generic et cetera, and.

Anytime there are these entrants they really haven't affected negatively.

To the product the branded products that are on the market. So we would welcome new entrants.

We don't believe that it will have a negative impact on cap lighter.

Revenues at all and if we expand the market by having more players.

That would be great too.

Thank you one moment for our next question.

Our next question comes from Greg <unk>.

<unk> with Mizuho you May proceed.

Hey, good morning. Thanks, so much for taking my question and congrats on a great third quarter I just wanted to ask perhaps a bigger picture question around <unk>.

Profitability in the company's view or philosophy around profitability vis vis its desire to invest in the commercial.

And R&D.

Aspirations for the company in other words, how are you trying to balance the two.

I'll ask Larry to take that understanding full well, though that we haven't given you.

Any forward looking guidance, yes.

Yes, right, we haven't given forward looking guidance.

We have given expense guidance.

2022.

We are critically looking at our spend going forward. We are we are positioning herself towards profitability.

But again, that's obviously dependent upon the trajectory of sales, which we believe is going to be very strong.

No.

Without giving you specifics I mean, our goal is to get the profitability, we keep our spending under control we look at all of our products are.

Jackson.

Development programs critically and.

Our goal is to become profitable as soon as we can.

Thank you one moment for our next question.

Yes.

Our next question comes from Jason <unk> with Bank of America, You May proceed.

Hi, This is carey on the line for Jason Thanks for taking our question just a quick follow up on selling and selling and marketing spend.

Should we had given guidance how are you seeing selling and marketing spending above with next year.

I would imagine with meaningful discretionary <unk> spend the question is whether that's going to be recurrent in more of a one time investment that you might scale back overtime and then.

Another question on the MPD adjunct indications. So can you speak to the upcoming three large producers and post marketing MTB indication I guess in terms of NPV adjunct.

FDA requires two positive phase II phase III.

<unk>.

First do you think might it needs to hit on both MTV phase threes.

Sure.

That's there's a split of the phase threes.

Mixed feature or the previous favorable BBB.

It still provides support for our second pivotal.

Yes.

Okay. Thanks.

Thanks Fred.

Couple.

Couple of questions.

Not sure I got all of them.

But the first one I think went to Larry.

About.

Is this one is our commercial.

Spend et cetera, onetime or do we expect to continue.

Want me to take that or do you want to take it Larry Larry Why don't you go ahead.

Yes sure sure.

Obviously, we have.

On a commercial side, we have various means that we are.

Promoting our product.

Different mediums and so forth and we gauge the effectiveness and are gauging the effectiveness of those and some risk going forward.

We're going to have those same programs and.

Working on the mix of that.

Spending amongst the programs. So I would say our spending in this line is pretty we've given you guidance for this year and it's been pretty straight on and we're looking at.

Spend now in the budgeting process so.

If we find opportunities that can increase our trajectory, we'll certainly take those and so that would be spend that would be in the right and the <unk>.

Right direction, we're not gonna refurbished forever please spend.

And take chances, but I think we're really going to be focusing on what we're doing right and I think mark alluded to do the things that we're looking at for next year to drive sales. So I think we're in good shape with our spending patterns. If you will.

And as we said in our prepared remarks, we continue to invest in the business.

As we move forward.

I think you can expect to continue to see the spending.

In our business.

In order to continue the trajectory that we're on.

So our top line.

And then to the question of <unk>.

Many studies do you need et cetera, I think it really depends on how the data looks okay. If tier two.

To overwhelmingly positive studies.

It's a homerun.

Sure Barry.

Close that's another question I think it's always going to be a discussion with the FDA. If one is.

It really depends on the outcome of the study and as to would it be prudent to have another study I think we constantly evaluate.

The opportunities and so.

We continuously evaluate these things.

Thank you one moment for our next question.

Our next question comes from Amit <unk> with Needham you May proceed.

Good morning, Congrats on the nice quarter.

Question about your comment around.

Exploration into.

The fourth quarter you talked about.

The strength in the recent weeks.

Can you more broadly.

Your expectations around how you see.

The growth trajectory.

Over the next couple of months.

Do you see that accelerating further from here.

That would be helpful and then.

As we enter 2023.

What are your thoughts on providing guidance.

<unk> apply to for next year.

So mark do you want to take the first part and I'll take the.

I think the last part right now.

Okay.

Exactly when we'll start giving guidance.

I think.

So.

By our next earnings call, we will have decided the appropriate time to start giving you.

Guidance, but at the moment, we don't have that answer for you, but we're looking at it very closely we know that high.

Were extremely interested in such metrics so.

I hate to say it again, but stay tuned.

And Mark do you want to take the first part of the question.

Yes sure. Thanks for your question.

I would say we were very pleased with the 26%.

Total prescription growth in the third quarter on the backdrop of a.

Our market during the summer months.

That had zero growth in it which reflects the fact that we were able to continue to drive market share and continue to penetrate the.

The prescriber base.

To drive that growth now as we come out of the summer months, where you have this summer seasonality, we do expect and we've actually seen signs of the branded market.

Growing in the fourth quarter, where it was more flat during the third quarter, which is a positive thing. So we'll have some some tailwind behind us and in addition to that additional market share gains in the fourth quarter should accelerate our growth in the fourth quarter versus the third quarter. So.

Again, where we feel confident that we will continue to experience robust growth.

In an accelerating fashion in the fourth quarter.

Okay.

Thank you one moment for our next question.

Okay, operator, we're going to have to be wrapping this up that says.

I mean, it's 930, maybe if there is one more question.

It sounds good our last question comes from Ashwin <unk> with UBS you May proceed.

Hi, Thanks for fitting me in so we see them being kept lidar MBR HCA has been strong consistently.

Antipsychotic category like how much time does it take for the <unk> and IDEXX share to start to track on the same level as the end, but <unk> sure. If you can comment on that.

Yeah.

Mark you Jeff.

Yes, sure SaaS, yes, we have been pleased with our new patient acquisition, which is what <unk> is reflective of and as I mentioned in my prepared remarks.

The weekly levels of new to brand prescriptions for <unk> are now at five times, what they were.

Fire to the.

Label expansion into bipolar depression, and I think <unk> is the driver. So MB Rx results in higher new prescriptions at Rx and those new prescriptions result in higher Trs and then obviously as you are adding.

New patients all the time weekly monthly quarterly those patients combined with the compliance and persistency profile for <unk>.

Is what drives the total prescription line.

If you look at the trajectory of our Trs <unk> line.

We've been very pleased with the continued significant growth that we've seen there and we expect that to continue into the fourth quarter and into the future years as well.

Great.

Well in the interest of time I want to just thank everybody for participating today and.

We are very pleased with the growth.

That we're seeing and the trajectory.

Of growth that we're seeing for cap later as well as as we advance our other programs both for label expansion for <unk> as well as other programs. We look forward to updating you on our next call and with that.

We're very pleased with the growth in our company as well so with that I would say operator, you can now disconnect. Thank you.

Thank you. This concludes today's conference call. Thank you for participating you may now disconnect.