Q4 2023 Intra-Cellular Therapies Inc Earnings Call and Business Update

Operator: Good morning, ladies and gentlemen, and welcome to Intra-Cellular Therapies' fourth quarter and year-end financial results conference call. At this time, all participants are in a listen-only mode.

Yeah.

Speaker Change: Good morning, ladies and gentlemen, and welcome to the intra cellular therapies fourth quarter and year end financial results Conference call. At this time, all participants are in a listen only mode.

Operator: After the speaker's presentation, there will be a question-and-answer session. To ask a question during the session, you will need to press star-one-one on your telephone. You will then hear a message advising that your hand is raised. To withdraw your question, press star-one-one again.

Speaker Change: After the speaker's presentation, there will be a question and answer session to ask a question. During this session you will need to press star one one on your telephone you will Dan here and message advising your hand this waste to withdraw your question Press Star one again.

Juan Sanchez: As a courtesy to other analysts, please limit your questions to one. Please note that today's conference is being recorded. I would now like to turn the conference over to Dr. Juan Sanchez, Vice President, Corporate Communications and Investor Relations.

Speaker Change: As a courtesy to other analysts please limit your questions to one. Please note that today's conference is being recorded I would now like to turn the conference over to Dr. Juan Sanchez, Vice President Corporate Communications and Investor Relations. Please go ahead.

Juan Sanchez: Good morning, and thank you all for joining us on our fourth quarter and full year 2023 earnings call. Joining me on the call today are Dr. Sharon Mates, Chairman and Chief Executive Officer, Mark Neumann, Chief Commercial Officer, Dr. Suresh Durgan, Chief Medical Officer, and Lawrence Hineline, Chief Financial Officer. As a reminder, during today's call, we will be making certain forward-looking statements. These forward-looking statements are based on current information, assumptions, and expectations. These 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 statement.

Juan Sanchez: Good morning, and thank you all for joining us on our fourth quarter and full year 2023 earnings call.

Juan Sanchez: Joining me on the call today are Cocker Sharon mates.

Juan Sanchez: A reminder, chief Executive Officer.

Speaker Change: Mark Newman, Chief Commercial officer, Dr. Celeste, Erkan, Chief Medical Officer, and Lori highly safe.

Speaker Change: <unk> financial officer.

Speaker Change: As a reminder, during today's call, we'll be making certain forward looking statements.

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

Speaker Change: These are subject to change I mean, both a number of risks and uncertainties that may cause actual results could differ materially from those contained in the forward looking statements.

Juan Sanchez: This and other risks are described in our periodic filings made with the Securities and Exchange Commission, including our quarterly and annual reports. Your question, not to place any reliance on these forward-looking statements, and the company disclaims any obligations to make such statements. Sharon.

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

Speaker Change: Your question.

Speaker Change: To place undue reliance on these forward looking statements and the company disclaims any obligations to update such statements.

Sharon Mates: Thanks, Juan. Good morning, everyone, and welcome to today's call. We are excited to share our results for the fourth quarter and the full year 2023. This past year was defined by strong and consistent growth throughout our company. We achieved major milestones as we established Keplita as a key treatment option for broad patient populations with bipolar depression and schizophrenia. We also advanced our pipeline programs and look forward to announcing top-line results in our major depressive disorder studies, Study 501 and Study 502. Our full year 2023 total revenues were $464 million, kept in light of net sales in 2023 were $462 million compared to $249 million in 2022, representing an 86% increase. Similarly, total scripts grew by 85% in 2023 compared to 2022.

Speaker Change: Shannon.

Shannon: Thanks, Juan good morning, everyone and welcome to today's call.

Shannon: We are excited to share our results for the fourth quarter and the full year 2023.

Shannon: This past year was defined by strong and consistent growth throughout our company.

Shannon: We achieved major milestones as we establish <unk> as a key treatment option for broad patient populations with bipolar depression and schizophrenia.

Shannon: We also advanced our pipeline programs and look forward to announcing top line results in our major depressive disorder study study one and study 502.

Shannon: Our full year 2023, total revenues were $464 million.

Kept light of net sales in 2023 were $462 million compared to $249 million for 2022.

Shannon: Representing an 86% increase.

Shannon: Similarly, total scripts grew by 85% in 2023 compared to 2022.

Shannon: Demand for a couple of Ida remains strong.

Shannon: Well executed commercial efforts continue to drive prescription growth from both new and existing prescribers.

Shannon: We anticipate continuing strong demand for cut lighter.

Shannon: Just on this positive momentum I am pleased to report that we expect full year 2024 kept light of net product sales to be in the range of $645 million to $675 million.

Sharon Mates: Demand for Keflavida remains strong. Our well-executed commercial efforts continue to drive prescription growth from both new and existing prescribers. We anticipate continuing strong demand for Keplita. Based on this positive momentum, I am pleased to report that we expect full-year 2024 Keplita net product sales to be in the range of $645 to $675 million.

Shannon: Mark will elaborate on our commercial performance and plans for this year in a moment and then Larry will share additional details regarding our financials.

Shannon: We continue to strategically invest in our pipeline and we anticipate further advancements in several of our late mid and early stage clinical programs in 2024.

Shannon: I'd like to share more specifics regarding our plans for expanding kept lineup beyond its current indications.

Shannon: We have two upcoming phase III topline readouts for the use of <unk> as an adjunctive treatment of major depressive disorder or M. D D.

Sharon Mates: Mark will elaborate on our commercial performance and plans for this year in a moment, and then Larry will share additional details regarding our financials. We continue to strategically invest in our pipeline, and we anticipate further advancement in several of our late, mid, and early stage clinical programs in 2024. I'd like to share more specifics regarding our plans for expanding Keplita beyond its current indication. We have two upcoming Phase 3 top-line readouts for the use of Lumeteperon as an adjunctive treatment for major depressive disorder, or MDD.

Shannon: Our 501 study is fully enrolled and most patients have completed treatment.

Shannon: We allowed the small number of patients who are in screening when we reached our previously determined enrolment targets to continue and be randomized to the double blind treatment phase of the study.

Shannon: The rationale for allowing these patients to continue to participate in the double blind treatment is that we believe that ethically. If a patient has participate enlist screening process and qualified for enrollment they should be allowed the possibility of receiving treatment.

Shannon: As a result, we expect to report topline results from study <unk> one in April of this year rather than late March.

Shannon: We remain on track to report topline results from study <unk> two late in the second quarter of this year.

Sharon Mates: Our 501 study is fully enrolled, and most patients have completed treatment. We allowed the small number of patients who were in screening when we reached our previously determined enrollment targets to continue and be randomized to the double-blind treatment phase of the study. The rationale for allowing these patients to continue to participate in the double-blind treatment is that we believe ethically that if a patient has participated in the screening process and qualified for enrollment, they should be allowed the possibility of receiving treatment. As a result, we expect to report top-line results from Study 501 in April of this year, rather than later. We remain on track to report top-line results from Study 502 late in the second quarter of this year.

Shannon: Subject to those results, we continue to anticipate filing a supplemental new drug application with the FDA in the second half of this year.

Shannon: We have a high degree of confidence in our M. D. D program as we have previously shared multiple lines of evidence support this confidence starting with lunar cat loss mechanism of action simultaneously modulating serotonin dopamine and glutamate systems.

Shannon: Accordingly, we have significant clinical evidence and several patient populations, including patients with schizophrenia with comorbid depression patients with bipolar depression in patients with M. D. D. Exhibiting next features.

Shannon: Of note <unk> is the only anti psychotic approved for both bipolar one and bipolar depression, both as monotherapy and as adjunctive therapy.

Shannon: We remain very excited by the possibility of helping millions of patients with M D.

Shannon: <unk> uptake of the last two anti Psychotics approved for adjunctive treatment in MVD underscores the continued unmet needs and large opportunity in this market.

Shannon: Given the efficacy and safety profile to date, we are confident and kept lightest future potential in this patient population.

Shannon: As we mentioned to you previously we were expecting to have a meeting with the FDA to discuss the results of study 403, particularly with respect to the MDT patient population with next features.

Shannon: I am pleased to report that we recently had a constructive meeting and as you know we wait for minutes prior to making any statements regarding our interactions with the FDA.

Sharon Mates: Subject to those results, we continue to anticipate filing a supplemental new drug application with the FDA in the second half of this year. We have a high degree of confidence in our MDD program. As we have previously shared, multiple lines of evidence support this confidence, starting with lumateflon's mechanism of action, which simultaneously modulates serotonin, dopamine, and glutamate systems. Additionally, we have significant clinical evidence in several patient populations, including patients with schizophrenia with comorbid depression, patients with bipolar depression, and patients with MDD exhibiting mixed features. Of note, CAPLIDA is the only antipsychotic approved for both bipolar I and bipolar II depression, both as monotherapy and as adjunctive therapy.

Shannon: We expect to receive the minutes from this meeting later this quarter and plan to update you regarding the outcome and next steps at that time.

Shannon: Beyond our MVP program, we continue to invest in our aluminum <unk> R&D program. Accordingly, we have initiated our <unk> pediatric program, which include an open label safety study in schizophrenia, and bipolar disorder, a double blind placebo controlled study in bipolar depression.

Shannon: And two double blind placebo controlled studies and irritability associated with autism spectrum disorder.

Shannon: Approximately two 8% of children in the United States have autism spectrum disorder.

Shannon: Irritability is a common symptom onset.

Shannon: Set of payers their daily activities with prevalence estimates ranging from about 25% to 45% of those patients there.

Shannon: There are only two anti psychotic approved for the treatment of irritability associated with autism spectrum disorder, and two anti Psychotics approved for the treatment of bipolar depression in the pediatric population.

Shannon: We believe when the capped wrong with its efficacy and favorable safety profile. If approved can address important medical needs for these younger patients and their families, especially given the heightened concern regarding metabolic and motor issues in these patient populations.

Shannon: Additionally, in the first half of 2024, we will continue to advance our long acting injectable in the TERP loan program studying for different formulations.

Sharon Mates: We remain very excited by the possibility of helping millions of patients with MDD. The significant uptake of the last two antipsychotics approved for adjunctive treatment in MDD underscores the continued unmet need and large opportunity in this market. Given the efficacy and safety profile to date, we are confident in Keplitis' future potential in this patient population. As we mentioned to you previously, we were expecting to have a meeting with the FDA to discuss the results of Study 403, particularly with respect to the MDD patient population with mixed features. I am pleased to report that we recently had a constructive meeting, and, as you know, we wait for minutes prior to making any statements regarding our interactions with the FDA. We expect to receive the minutes from this meeting later this quarter and plan to update you regarding the outcome and next steps at that time.

Shannon: In summary, we continue the very successful launch of kept light and are confident in the continued robust growth throughout 2024.

Kept light it is an important treatment option for patients with bipolar disorder and schizophrenia. These.

Shannon: These conditions account for about 50% of the U S anti psychotic markets nearly 68 million scripts each year.

Shannon: With the potential addition of empty day, our total addressable market would expand to cover nearly 80% of the market's prescriptions.

Shannon: In addition, we expect our development programs among younger patient population and our work with long acting injectables to further maximize the value of our <unk> portfolio.

Shannon: Outside of <unk>, our pipeline continues to move forward with several clinical trials underway and others commencing soon.

Shannon: ITI 284 is an important product candidates in our neuro psychiatry portfolio.

Shannon: In the first half of 2024, we plan to initiate patient enrollment in phase III clinical trial.

Shannon: Starting with our generalized anxiety disorder program. Our first study will evaluate 12 84 as adjunctive treatment to SSRI and SNRI.

Shannon: Also in the first half of 2024 will begin clinical conduct to evaluate ITI <unk> 84 for the treatment of psychosis and Alzheimers disease agitation in Alzheimer's disease.

Shannon: And our phosphodiesterase one inhibitor program, a relentless potent phase II clinical trial in Parkinson's disease is ongoing and we expect to complete enrollment in late 2024 with topline results expected in the first half of 2025.

Shannon: With respect to our ITI <unk> 'twenty oncology program, our phase one single ascending dose study in healthy volunteers is progressing.

Shannon: Our earlier stage development programs include ITI triple spray for opioid use disorder in pain for which a multiple ascending dose study and deposit tonne emission tomography study are both ongoing.

Shannon: Also in development is our non hallucinogenic psychedelic program.

Shannon: This past December at the American College of Neuropsychopharmacology, We presented preclinical data from our lead compound ITI $15 49.

Shannon: We are very encouraged by the positive reception art presentation received from the scientific and medical community and we look forward to advancing Hei 15 49 into human testing in late 2024 or early 2025.

Shannon: In 2023, we presented new cap light of data regarding our development programs at several medical and scientific meetings. We also published results in various medical journal demonstrating our progress throughout the course of the year.

Shannon: Looking ahead to 2024, we are starting off operationally and financially strong.

Sharon Mates: Beyond our MDD program, we continue to invest in our Lumateparon R&D program. Accordingly, we have initiated our Lumateparon Pediatric Program, which includes an open-label safety study in schizophrenia and bipolar disorder, a double-blind placebo-controlled study in bipolar depression, and two double-blind placebo-controlled studies in irritability associated with autism spectrum disorder. Approximately 2.8% of children in the United States have autism spectrum disorder. Irritability is a common symptom that interferes with their daily activities, with prevalence estimates ranging from about 25 to 45 percent of those patients.

Shannon: As of December 31, 2023, we had approximately $500 million in cash cash equivalents and investment securities and we have no debt and.

Speaker Change: I'm incredibly proud of our team and our accomplishments and I'm excited to embark on our next phase of growth in 2024.

Shannon: I will now turn the call over to Mark to further discuss Capsulitis performance and our plans for 2024 Mark.

Mark Neumann: Thanks Sharon.

Mark: Everyone, it's great to be with you today.

Mark: 123 was a year of tremendous progress and establishing capital either as a leading treatment option for patients with bipolar depression and schizophrenia.

Mark: Setting the stage for continued robust growth in 2024 and beyond.

Mark: We continue to work our way up the physician adoption curves, adding more than 15000, new first time prescribers of capitalized during the year.

Mark: Growing the breadth of our cumulative physician prescriber base since launch to over 36000 by the end of the year.

Sharon Mates: There are only two antipsychotics approved for the treatment of irritability associated with autism spectrum disorder and two antipsychotics approved for the treatment of bipolar depression in the pediatric population. We believe LumaKeperon, with its efficacy and favorable safety profile, if approved, can address important medical needs for these younger patients and their families, especially given the heightened concern regarding metabolic and motor issues in these patient populations. Additionally, in the first half of 2024, we will continue to advance our long-acting injectable lumateplerone program, studying four different formulations. In summary, we continue the very successful launch of CAPLIDA and are confident in the continued robust growth throughout 2024. Keplita is an important treatment option for patients with bipolar disorder and schizophrenia.

Mark: We also saw consistent quarter over quarter increases and the depth of prescribing as existing prescribers identified more and more patients who are appropriate for capital I to treatment.

Mark: This progress was driven by our comprehensive promotional activities, including the expansion of our sales force executed in Q2 of 2023.

Mark: Extensive peer to peer medical education programming and robust digital advertising.

Mark: Complementing our professional promotion was a comprehensive consumer and patient campaign, featuring broad national advertising through television and social media to enhance awareness among the 11 million adults with bipolar disorder and to communicate the potential benefits of capital item for these patients.

Mark: For the year capital I'd have posted strong growth, increasing total prescriptions by 85% in 2023 versus 2022.

Mark: And finishing the year with significant momentum accelerating growth in total prescriptions to 10% sequentially in Q4 versus Q3.

Mark: We are well positioned to drive continued robust growth throughout 2024.

Mark: Capital either has a very compelling product profile that feature strong efficacy and a favorable safety and tolerability profile.

Mark: In our clinical studies capitalizes metabolic parameters, which include changes in weight cholesterol glucose are all similar to placebo.

Mark: Equally importantly movement disorders, like EPS and Akathisia are also similar to placebo.

Sharon Mates: These conditions account for about 50% of the U.S. antipsychotic market, or nearly 68 million scripts each year. With the potential addition of MDD, our total addressable market would expand to cover nearly 80% of the market's prescriptions. In addition, we expect our development programs among younger patient populations and our work with long-acting injectables to further maximize the value of our Lumeteperon portfolio. Outside of Lumeteperon, our pipeline continues to move forward, with several clinical trials underway and others commencing soon. ITI-1284 is an important product candidate in our neuropsychiatry portfolio.

Mark: Capitalized favorable profile is very important as these side effects can often lead to poor patient compliance and drug discontinuation.

Mark: Another real benefit we hear from physicians is that they can start their patients at the effective dose without having to titrate.

Mark: Instead of waiting days or weeks to complete that process.

Mark: <unk> also appreciate the convenience of capital items once daily dose.

Mark: In 2024, we will continue to invest in optimizing the growth of capital Ida with several enhancements to our comprehensive promotional plan.

Mark: As I mentioned previously we added approximately 50 additional sales representatives late in Q1 of 2023.

Mark: And those representatives are now firmly established and contributing significantly to our growth.

Mark: We've also had consistently favorable results from our comprehensive direct to consumer platform and we will continue these efforts throughout 2024 with a new creative campaign being introduced in Q2.

Mark: Finally, we continue to enjoy a strong market access position with over 99% Medicare and Medicaid lives covered now.

Sharon Mates: In the first half of 2024, we plan to initiate patient enrollment in Phase 2 clinical trials. Starting with our Generalized Anxiety Disorder Program, our first study will evaluate 1284 as adjunctive treatment to SSRIs and SNRIs. Also, in the first half of 2024, we will begin clinical conduct to evaluate ITI 1284 for the treatment of psychosis in Alzheimer's disease and agitation in Alzheimer's disease. In our Phosphodiesterase I inhibitor program, our Lenlis-Poden Phase II clinical trial in Parkinson's disease is ongoing, and we expect complete enrollment in late 2024, with top-line results expected in the first half of 2025. With respect to our ITI 1020 Oncology Program, our Phase I Single-A Sending Dose Study in healthy volunteers is progressing. Our earlier stage development programs include ITI333 for opioid use disorder and pain, for which a multiple ascending dose study and a positron emission tomography study are both ongoing. Also in development is our non-hallucinogenic psychedelic program. This past December at the American College of Neuropsychopharmacology, we presented the preclinical data from our lead compound, ITI-1549.

Mark: About 90% covered commercial lives.

Mark: As I mentioned in our last call from the end of Q3 2023, and the beginning of the fourth quarter, we negotiated an improvement in the utilization criteria for capital either with two of the largest Medicare part D payers.

Mark: We were able to move capital Ida from a prior authorization and to generic steps the unrestricted status with these plans.

Mark: We've already seen some initial benefits from this in the fourth quarter and we expect to see the full impact of these changes this year.

Mark: In summary, we made tremendous progress with cap light in 2023, and we are confident that capitalizes favorable product profile and our incremental promotional investments behind the brand will result in a robust year of capital either growth in 2024.

Mark: I'll now turn the call to Larry to discuss our financial performance Larry.

Larry: Measured by days on hand of capital I at at the wholesale level remain consistent relative to the prior quarter.

Larry: For the full year 2023, total revenues were $464 $4 million compared to $253 million in 2022.

Larry: Net product sales of cap later, where $462 $2 million for the full year 2000 twenty-three in line with our guidance. This represents an increase of 85.5% compared to 2022.

Sharon Mates: We are very encouraged by the positive reception our presentation received from the scientific and medical community, and we look forward to advancing ITI 1549 into human testing in late 2024 or early 2025. In 2023, we presented NUCAP-LIDAR data regarding our development programs at several medical and scientific meetings. We also published results in various medical journals, demonstrating our progress throughout the course of the year. Looking ahead to 2024, we are starting off operationally and financially strong. As of December 31, 2023, we had approximately $500 million in cash, cash equivalents, and investment securities, and we had no debt.

Larry: SG&A expenses were $409 $9 million for the year ended December 31, 2023, compared to $358 $8 million for the year ended December 31 2022.

Larry: R&D expenses were $180.1 million for the year ended December 31, 2023 compared to $134.7 million for the year ended December 31st 2022.

Larry: Turning to our outlook for 2024 is Sharon mentioned, we expect capitalize on that product sales three between 645 and $675 million, reflecting continued strong demand.

Larry: Four 2024, we estimate SG&A expenses to range between 450, and $480 million, which includes approximately $38 $6 million of non-cash sure based compensation expense.

Larry: This reflects our commitment to continue to effectively and efficiently support calculator commercialization through investments in our sales organization and marketing activities.

Larry: For 2024, we estimate R&D expenses to range between 215, and $240 million, which includes approximately $22.5 million of non-cash sure based compensation expenses.

Mark Neumann: I'm incredibly proud of our team and our accomplishments, and I'm excited to embark on our next phase of growth in 2024. I will now turn the call over to Mark to further discuss Teplitis' performance and our plans for 2024. Mark. Thanks, Sharon. Good morning, everyone.

Larry: R&D guidance reflects investments to support our broad pipeline in 2024, we anticipate that a large portion of our total R&D expenditures will be related to our <unk> development programs as we continue to explore the use of <unk> an additional patient populations.

Larry: Our financial position remains strong cash cash equivalents investment securities and restricted cash totaled $499 $7 million at December 31, 2023.

Mark Neumann: It's great to be with you. 2023 was a year of tremendous progress in establishing Kapalaita as a leading treatment option for patients with bipolar depression and schizophrenia, setting the stage for continued robust growth in 2024 and beyond. We continue to work our way up the physician adoption curve, adding more than 15,000 new first-time prescribers of Kaplita during the year and growing the breadth of our cumulative physician prescriber base since launch to over 36,000 by the end of the year. We also saw consistent quarter-over-quarter increases in the depth of prescribing, as existing prescribers identified more and more patients who were appropriate for capillitis. This progress was driven by our comprehensive promotional activities, including the expansion of our sales force executed in Q2 of 2023, extensive peer-to-peer medical education programming, and robust digital advertising.

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

Speaker Change: Thank you as a reminder, as a courtesy to other analysts. Please keep your questions to one one moment, while I announced our first analyst.

Andrew: And he comes from the line of Andrew It's Jefferies. Please proceed.

Andrew Jefferies: Hey, Thanks, good morning, Congrats on the strong execution and the continued progress. So for me I wanted to ask an M. D. D. Today, what is your guys latest thinking in terms of what we can expect to see in the top line release in April and then you know our understanding is at two point.

Andrew Jefferies: [noise] placebo adjusted change should be a good efficacy result that is there anything else you would encourage the street to also look for as when you think about <unk> potential differentiation and I jumped at M. D. Such as response rates remission rates safety profile anything else. Thank you.

Andrew Jefferies: Alright.

Speaker Change: Thanks, so much for the question.

Speaker Change: <unk> and I'll start off and then I'll ask it's the rash has anything he wants to add.

Speaker Change: Typically in our top line data, what we do I'll put out is all of the information that we have at that point.

Speaker Change: As you know these are large studies that we do so we don't get all of the top line data all of the data at one moment in time.

Mark Neumann: Complementing our professional promotion was a comprehensive consumer and patient campaign, featuring broad national advertising through television and social media, to Enhance Awareness Among the 11 Million Adults with Bipolar Disorders and to communicate the potential benefits of CAPILITA for these patients. For the year, Keplita posted strong growth, increasing total prescriptions by 85% in 2023 versus 2022 and finishing the year with significant momentum, accelerating growth in total prescriptions to 10% sequentially in Q4 versus Q3. We are well positioned to drive continued robust growth throughout 2020. Caplita has a very compelling product profile that features strong efficacy and a favorable safety and tolerability profile. In our clinical studies, capillitis metabolic parameters, which include changes in weight, cholesterol, and glucose, are all similar to.

Speaker Change: So we know how anxious both we and the street or we put the data out when we get it. So we certainly expect the primary and point, which has changed from based on your home address and they'll also put out any other data that we have at that point and you're right that typically in these studies.

Speaker Change: You expect to see a two to four point change on the mattress, but on in a junk to study you expect to be at the lower end, whereas in mono therapy studies, you expect to be at the higher end. So that's what you know.

Speaker Change: We're expecting will be power are studies too approximately 90 per cent.

Speaker Change: And so and.

Speaker Change: We obviously as I said in our prepared remarks, we have confidence both in our program in these studies.

Speaker Change: <unk> performance in these studies.

Speaker Change: So with that I don't know the rash do you have anything you want to add.

Rash: Not at this time you have to <unk> okay.

Rash: Thank you. Thank you.

Speaker Change: Thank you one moment for our next question. Please.

Rash: Confirm the line of Brian Abrahamsen with R. B C capital markets. Please proceed.

Brian Corey Abrahams: Hey, yeah, congrats as well from from my end and all the continued progress.

Brian Corey Abrahams: Maybe continuing on M. D. D can you talk on maybe give us a little bit more of a sense of the degree of I guess of over enrollment you may have in the study how that might impact powering and then I guess, how you're thinking about you know as these results.

Mark Neumann: Equally important, movement disorders like EPS and akathisia are also similar to placebo. Kapalaitis' favorable profile is very important as these side effects can often lead to poor patient compliance and drug discontinuation. Another real benefit we hear from physicians is that they can start their patients at the effective dose without having to titrate, instead of waiting days or weeks to complete that process. Physicians also appreciate the convenience of cathletas once daily.

Brian Abrahamsen: Come out of it during the second quarter.

Brian Corey Abrahams: We are the most differentiation potential it could be here in terms of positioning relative to some of the other adjunctive atypical in the space. Thanks.

Brian Corey Abrahams: Okay. Thanks. So this is Sharon again.

Sharon: And I'll start with regards to yes S. As we said.

Mark Neumann: In 2024, we will continue to invest in optimizing the growth of capillata with several enhancements to our comprehensive promotional plan. As I mentioned previously, we added approximately 50 additional sales representatives late in Q1 of 2023, and those representatives are now firmly established and contributing significantly to our growth.

Sharon:

Sharon: Patients come into screening and we did believe that you know patients who are in screening who passed through successfully through the screening process should be allowed to enter typically you plan. Your studies so that.

Sharon: You will have at least the number of patients when whenever you put a protocol in place you say approximately like we had approximately 470 patients.

Sharon: We.

Sharon: <unk>.

Sharon: We screen appropriately for that and we had patients come through so it's a small number of patients. It's typically under five per cent that you over as well and that is what fit the bill here that we allowed to come in that you older screen and if a passenger allowed to go in.

Mark Neumann: We've also had consistently favorable results from our comprehensive direct-to-consumer platform, and we will continue these efforts throughout 2024 with a new creative campaign being introduced in Q2. Finally, we continue to enjoy strong market access for this, with over 99% of Medicare and Medicaid lives covered and about 90% covered commercially. As I mentioned in our last call, from the end of Q3 2023 through the beginning of the fourth quarter, we negotiated an improvement in the utilization criteria for Caplyta with two of the largest Medicare Part D payers. We were able to move Caplyta from prior authorization and two generic steps to unrestricted status with these plans. We've already seen some initial benefits from this in the fourth quarter, and we expect to see the full impact of these changes this year. In summary, we made tremendous progress with Caplita in 2023, and we are confident that Caplita's favorable product profile and our incremental promotional investment behind the brand will result in a robust year of Caplita growth in 2023. I'll now turn the call over to Larry to discuss our financial... Larry?

Sharon: So.

Sharon: That is what we have but of course, you do need to wait for them to complete Oh. It's just a couple of weeks later that they are coming through finishing up.

Sharon: The study and that's why this study will read out in April rather than in March.

Sharon: So I think.

Stretch: Don't know stretch did you want to add anything to that.

Stretch: Yeah, I think it would asking about the <unk> for this okay, I'm not going to be any polling implications because the number is so small so.

Speaker Change: Following implications.

Stretch: Implications.

Speaker Change: Right and then.

Speaker Change: <unk> and you also asked about that and I think that I think kept light has demonstrated its efficacy and favorable safety and tolerability profile and with that we think that there is a real need in the marketplace for additional agents and.

Speaker Change: That kept light can perform well in this marketplace.

Speaker Change: Thanks, Sheryl Thanks for <unk>.

Speaker Change: Thanks, one moment for our next question please.

Speaker Change: It comes from the line of Jessica five with J P. Morgan. Please proceed.

Jessica: Hey, guys. This is nah sun on for just congratulations.

Jessica: Patients on the strong guidance for <unk> 2024, Uhm can you walk us through some of the assumptions that's underline the guidance what what does it mean in terms of you shouldn't penetration and then how do we think about the gross to net dynamics.

Speaker Change: In 2024 thanks.

Speaker Change: So maybe I'll ask Mark if you Wanna talk to the first part and then Larry if you want to talk to the gross to nap.

Lawrence J. Hineline: Thank you, Mark. I will provide highlights of our financial results for the fourth quarter and year ending December 31, 2022 and our outlook for 2024. In the fourth quarter, net product sales of Capalito were $131.5 million, compared to $87.4 million for the same period in 2022, representing a year-over-year increase of 50.4%. Our increase in net product sales was primarily driven by strong underlying prescription growth, a 55% increase versus the same quarter in 2022 and a 10% sequential increase over the third quarter of 2023. This increase was partially offset by a higher gross-to-net percentage in the fourth quarter that was at the high end of the low 30s, still in line with our prior guidance. For 2024, we expect Capillitis' gross to net percentage to be in the mid-30s throughout the year. Q4 inventory levels in the trade, measured by days on hand of Capilita at the wholesale level, remain consistent relative to the prior quarter.

Speaker Change: Okay.

Mark: Yeah sure Sharon so the the guidance that we put out the main driver of that guidance is the underlying strong demand trends that we see.

Mark: In the business and the continued demand four capp lighter so any variation around that trend is really where you get the the range and in the guidance.

Mark: We expect to continue to penetrate both the schizophrenia and bipolar depression market.

Mark: Where we focus both on increasing the breath of prescribing are prescriber basis I mentioned in my <unk>.

Mark: Repaired remarks last year, we added over 15000, new first time prescribers kept light up we expect to see that continue in 2024 as well as at the same time across the entire prescriber base.

Mark: Of what is now over 36000, we expect to continue to see increased depth of writing as these existing prescribers get more experience and they find more and more patients that are appropriate.

Mark: Four capital items.

Mark: So those are the main factors that go into the the guidance range that we provide thank you also had a question on how to think about gross to nets for 2024, so for that I will turn it over to Larry Yeah. Yeah. Thanks, Mark Yeah, <unk> in 2024 is going to be and we project to be in the mid thirties and that's compare it.

Lawrence J. Hineline: For the full year 2023, total revenues were $464.4 million, compared to $250.3 million in 2022. Net product sales of Capilata were $462.2 million for the full year 2023, in line with our guidance. This represents an increase of 85.5% compared to 2020. SG&A expenses were $409.9 million for the year ended December 31, 2023, compared to $358.8 million for the year ended December 31, 2022.

Larry: The low thirties that we saw in 2023 now there are several primary drivers for this increase where are we have increases in volume going through the commercial channel as a result of strong I've taken in the bipolar program.

Larry: There are also been recent improvements in Medicare part D coverage. So those two of the main drivers for the the the increase from the low thirties to the mid thirties.

Speaker Change: Alright, just answered the question.

Speaker Change: Yeah <unk> go ahead <unk>. Thank you one moment please.

Jeff Hung: Our next question is from Jeff hung with Morgan Stanley. Please proceed.

Jeff Hung: Hi, This is Michael Riad on for just hung. Thank you for taking my question for Adjunctive M. D. D to what extent is the background ADT influence the placebo effect and how should be thinking about placebo response variability between study 501502, and 505 alright. The three studies balanced in terms of the <unk>.

Lawrence J. Hineline: R&D expenses were $180.1 million for the year ended December 31st, 2023, compared to $134.7 million for the year ended December 31st, 2022. For 2024, we estimate SG&A expenses to range between $450 and $480 million, which includes approximately $38.6 million of non-cash, share-based compensation expenses. In 2024, we anticipate that a large portion of our total R&D expenditures will be related to our lumateperone development programs as we continue to explore the use of lumateperone in additional patient populations. Meanwhile, our financial position remains strong. Cash, cash equivalents, investment securities, and restricted cash totaled $499.7 million as of December 31st, 2020.

Speaker Change: Brown regimen. Thanks, so much.

Speaker Change: The rash would you like to <unk> to that yeah. So yeah. So in this program for <unk> with that.

Speaker Change: <unk>, we have allowed S. S. R I's S or not I had some other anti <unk> 100 per cent to be the back at all.

Speaker Change: And <unk> <unk>.

Speaker Change: Into this.

Speaker Change: So the <unk> the <unk>.

Speaker Change: <unk> in terms of you're talking about the placebo response.

Speaker Change: Again, and I'll see you in a style of <unk> in particular.

Speaker Change: As long as we tried to mitigate it by taken several measures. So this is no different in this study also that we are taking like.

Speaker Change: Allowing for proper authentication of patients, making sure that they have the latest <unk> coming in.

Speaker Change: So we have taken those measures in terms of the placebo response.

Speaker Change: In terms of individual.

Speaker Change: Medications, we group them based on <unk> individual medications.

Speaker Change: Will not be taken into account.

Speaker Change: Calling from a class last night.

Speaker Change: And all all of the the whole program has been done the same way so we allow <unk>.

Speaker Change: And H H bar studies and depression.

Operator: Thank you. Thank you. One moment for our next question, please. Maybe continuing on MDD, can you maybe give us a little bit more of a sense of the degree of, I guess, over-enrollment you may have in the study, how that might impact powering, and then, I guess, how you're thinking about, as these results come out during the second quarter, where the most differentiation potential could be here in terms of positioning relative to some of the other adjunctive Thanks. We will.

Speaker Change: And then also helping <unk>.

Speaker Change: I noticed that all the drugs that are <unk>.

Speaker Change: Been done the sandwich.

Speaker Change: Thanks.

Speaker Change: Alright. Thank you one moment for our next question. Please.

Evercore: And he's from the line of <unk> with Evercore. Please proceed.

Evercore: Hi, guys. This is mighty Fury indifferent warmer. Thanks, so much for taking my question and congressional the progress in 2023.

Mighty Fury: Two for me one is a variation of the question just asked.

Mighty Fury: Study 501 for the agent to entity trials seems to have a little bit more diverse set of X U S countries participating <unk>.

Mighty Fury: Compared to study 502, and my question is could there be any local regional differences in the way medicine is practiced that makes you more or less.

Mighty Fury: Confident that.

Mighty Fury: The the.

Mighty Fury: 502, it would be successful given that both trials are designed exactly the same and I have a follow up.

Sumant Kulkarni: That is what we have, but of course, you do need to wait for them to complete. So, I think, I don't know, Suresh, did you want to add anything to that? Yeah, I think they were asking about the powering for this. There's not going to be any powering implications because the number is so small. So I would not expect any powering.

Mighty Fury: Yeah. So this is Sharon thanks for the question like and I'll start in Alaska rash, if he wants to fill in.

Mighty Fury: Uhm.

Sharon: We plan all of our studies the same way that are late stage global studies.

Sharon: And that is you look at the different countries and we planned for the U S to have a proportion of patients and for X. You guys have a proportion of patients and that proportion of patience is typically around 30 per cent U S and then X U S.

Sharon Mates: Right. And on differentiation, you also asked about that. And I think that Keplita has demonstrated its efficacy and favorable safety and tolerability profile. And with that, we think that there is a real need in the marketplace for additional agents and that Keplita can perform well in this marketplace. Thanks, Sharon. Thanks, Chris.

Sharon:

Sharon: <unk> M M.

Sharon: And this is no different so 501 and 502 are the same I I don't I.

Speaker Change: I didn't quite get the part of the question, where you seem to think there's a difference because there isn't any difference some of the countries are different but it's X U S. M U S patient populations.

Operator: All right, does that answer the question? Operator, go ahead with our next call, please. Thank you. One moment, please.

Sharon: <unk>.

Sharon: What is common practice in what in discussions with the F D. A what they like to say.

Speaker Change: [noise] got it that's a normal.

Speaker Change: I'm, sorry did you have anything more to add.

Sumant Kulkarni: So the background in terms of we're talking about the placebo response, again, in all CNS trials and MDG trials in particular, we try to mitigate it by taking several measures. So this is no different in this study also, where we are taking measures allowing for proper adjudication of patients, making sure that they have the right severity that are coming in. So we have taken those measures in terms of the placebo response, and medications. We group them based on SSRIs and SNRIs. Individual medications will not be taken into account.

Speaker Change: The rash did you have anything to add.

Speaker Change: In terms of again, that's true you know we have about 30 person coming from U S X two S and the question about.

Speaker Change: Countries, but these are all standard practice guidelines, so that's pretty much absorbed throughout the world.

Speaker Change: So in terms of the practice guidance I somehow got Baptists.

Speaker Change: Look into that and we select countries have have a similar effect is full of patterns.

Speaker Change: Right.

Speaker Change: I couldn't I couldn't hear what rush said.

Speaker Change: But just to make clear we aim for around 30% give or take a percent or two on either side.

Speaker Change: Got it that's helpful and my my father question and forgive me if I. Miss This have you met with the FDA to discuss the mixed features data in context with a broader adjunct if M. D D vacation managers and if so would you be able to offer any commentary color there. Thank you.

Sumant Kulkarni: They'll just be taken into account class-wide. Study 502 would be successful, given that both trials are designed exactly the same and have a follow-up. And this is no different. So 501 and 502 are the same. I don't think so.

Speaker Change: Yeah. Thanks, Mike, Yes, and are prepared remarks, I did say that we did recently have a meeting with the F. D. A and that it was a constructive meeting and that as is our practice, we always wait for the F D a minutes uhm.

Speaker Change: Before we say anything and so once we have the minutes.

Speaker Change: Well further update to uhm.

Sharon Mates: Yeah, thanks, Mike. Yes, in our prepared remarks, I did say that we did recently have a meeting with the FDA and that it was a constructive meeting and that, as is our practice, we always wait for the FDA's minutes before we say anything. And so once we have the minutes, we'll further update you on the program and on our meeting. Oh, we're good.

Speaker Change: Uhm on the program and <unk>.

Speaker Change: So we're good got it thank you.

Speaker Change: Thank you one moment for our next question. Please.

Margaret Men: Alright. It comes from the line of Margaret men with Leering partners. Please proceed.

Margaret Men: Hi, Thanks for taking my question this really online homework congrats on the quarter. So K can maybe talk about a couple.

Margaret Men: <unk> trajectory moving into first quarter 24.

Operator: Got it. Thank you. Thank you. One moment for our next question, please. Hi there, good morning.

Margaret Men: How should we think about the <unk> girls versus fourthquarter, given the seasonality and maybe a decent I'm, calling on the T. T. C campaign you plan in 2024. Thanks.

Operator: Thank you for taking my question and congratulations on the quarter. Maybe just if you could talk a little bit about the expected size of the Salesforce expansion that would be necessary if the MDD indication is allowed to move forward onto the label. I know we've heard some success with MDD in the primary care setting. So would you look to expand a little bit more there?

Speaker Change: Thanks, Mark you Wanna take that please.

K: Yeah sure. Thanks for the question. So we have very strong fourth quarter accelerating our total prescription growth.

Mark: 10%, so we come into the year in 2024 with.

Mark: Significant momentum in that regard.

Mark: Typically as you alluded to in the first quarter you see some typical headwinds associated with patients switching market access plans.

Mark: When you have a product like ours with an increasing.

Mark Neumann: And is any of your expense guidance for 2024 earmarked for an expansion for MDD, or would that be more of a 2025 move? Thank you, Mark. Would you like to take that? Yeah, sure. Thanks, Joseph, for the question. Yeah, so to answer the second part of the question first, our SG&A guidance for the year 2024 does not contemplate any material expansion in our sales force. We continually evaluate our marketing activities and our sales force sizing, and we take advantage of any opportunities that we see to fuel additional growth. But in terms of any major expansion, we don't contemplate that in 2024.

Mark: Portion of the business coming through the commercial channel you also have.

Mark: Increased co pay assistance required is patience deductibles reset for the year and then typically that decreases over the course of the year. So we feel very good about the momentum we have the underlying business the demand in the business the.

Mark: The reception that physicians have had the the product and the feedback that they provide to us on their experience and the patient's experience.

Mark: Yes, typically in the first quarter you do see some some headwinds and then in the second quarter U C. A reacceleration egg wrote so that's in general how I would I would think about the the upcoming quarters.

Speaker Change: Thank you one moment for our next question. Please.

Mark: Mmm.

Speaker Change: Having an issue promoting the next question one moment please.

Speaker Change: Alright. Our next question comes from Joseph told me for a T D. Calling please proceed.

Mark Neumann: Once we have the data, and we understand that we're on the track for a filing and approval, we do expect to increase the size of our sales force to ensure that we're optimizing Capalita and the growth opportunity we would see in MDD, which is a very significant market. To give you a little bit of background, for bipolar depression and schizophrenia, we currently target about 43,000 physicians that are primarily psychiatrists and the nurse practitioners that support them, and a smaller segment of primary care physicians who do treat a lot of bipolar depression and are high-volume prescribers of antipsychotics. They are included in our current 43,000 physician target list. As we contemplate an approval in MDD, that target list will increase significantly, and it will increase mostly in the area of primary care. Because there are many more primary care physicians who are comfortable treating MDD with adjunctive antipsychotics who aren't very high-volume prescribers for bipolar depression and certainly not for schizophrenia, and it would be for that group of physicians that we would look to expand our sales force.

Joseph: Good morning. Thank you for taking my question and congrats on the corner, maybe just if you could talk a little bit on the expected size of the salesforce expansion that would be necessary uhm. If the M. D. D indication is allowed to move forward onto the label I know, we've heard some success and M D D and the primary care setting so.

Joseph: Would you look to expand a little bit more there is any of your expense guidance for 2024 earmarked for an expansion for M. D D or would that be more of a 2025.

Joseph: Mark would you like to take that.

Speaker Change: Yeah sure thing Thanks, Joseph with a question yeah. So to answer the second part of the the the question first or SG&A guidance for the year for 2024 does not contemplate any material expansion in our in our Salesforce, we continually evaluate our marketing activities in our sales for some.

Joseph: Being able to take advantage of any opportunities that we see to fuel additional growth, but in terms of any major expansion, we don't contemplate that in 2024.

Joseph: Once we have the data and we understand that were on the track for a filing an approval.

Speaker Change: We do expect to increase the size of our sales force to ensure that we're optimizing.

Joseph: Capital Ida and the growth opportunity, we would see an M D D, which is a very significant market.

Joseph: To give you a little bit of background for bipolar depression and schizophrenia. We currently target about 43000 physicians that are primarily psychiatrist and the nurse practitioners that support them.

Mark Neumann: Now, the 43,000 physicians that we currently call on will be able to leverage them, because virtually all of the 43,000 who are high-volume prescribers for bipolar depression will also be high-volume prescribers for MDD, and they'll have about four or five years of experience with the brand. We think we'll be able to have a really good jumping-off point with that group of physicians. The extent to which we expand our sales force will be determined by how far and how quickly we want to go into primary care. Those are the things that we have been working on, and as we get a little bit closer to talking about our launch plans, we'll come back to you with more specifics about that.

Joseph: A a smaller segment of primary care physicians, who do treat a lotta bipolar depression, and our high volume Prescribers man I Psychotics. They are included in our current 43000, a physician target list.

Joseph: As we contemplate an approval in N D D that target list will increase significantly and it will increase mostly in the area of primary care.

Joseph: Because there are many more primary care physicians, who are comfortable treating M. D D, where the junk to vanna Psychotics, who.

Joseph: Aren't very high volume prescribers for bipolar depression, and certainly not for schizophrenia and it would be for that group of physicians that we would look to expand our sales force now the 43000 physicians that we currently call on will be able to leverage them because virtually all of the 43000.

Joseph: Who are high volume prescribers for bipolar depression will also be high volume prescribers for M. D D and they'll have about four or five years of experience with the brand.

Operator: Hopefully, that background is helpful for you, and I'll leave it at that. Great, thank you. Thank you. One moment for our next question. Hi, David. Thank you for the question. And maybe I'll ask Mark to start out, and then I'll take the 1284. I may need to ask you to repeat it if I can't remember it by then, but let's start with Mark.

Joseph: So we think we'll be able to have a really good jumping off point with that group of physicians and the extent to which we expand our sales force will be determined by how far and how quickly we want to go into primary care and those are the things that we have been working on that as we get a little bit closer.

Joseph: To the talking about our launch plans will come back to you with more specifics about that so hopefully.

Mark Neumann: Yeah, sure. Thanks for the question, David. Yeah, for the potential label expansion into MDD, we would expect a pretty seamless process for the addition of MDD to the label when it comes to payer access. In general, with the antipsychotic category, payers manage these products at the brand level, not at the indication level, meaning that whatever your coverage is for the existing indication, they will cover it.

Speaker Change: Hopefully that background is helpful for you and I'll leave it at that for now.

Speaker Change: Great. Thank you.

Speaker Change: Thank you one moment for our next question. Please.

Speaker Change: Alright, any confirm the line of David Absalom with Piper Sandler. Please proceed.

David A. Amsellem: Thanks, So just two quick ones one is with the M. D. D label expansion can you talk to pay or access and particularly how we should think about rebating with commercial plans and and the gross and net over time.

Mark Neumann: That coverage gets carried over to the new indication as well. That's what we experienced when we moved from schizophrenia to the label expansion for bipolar depression. And we've seen similar dynamics with competitive products that have added MDD to an already existing schizophrenia and bipolar depression label. So we would expect it to be a fairly similar process, and it's another reason why we expect to be able to get off to a quick start with that potential approval. So with that, maybe I'll turn it back over to Sharon for the second question that you had around 12. Okay, thanks. Thanks a lot. So, just for those listening who may not be familiar with 1284, let me just remind everyone that 1284 is a deuterated form of lumateperon, where the carbon-deuterium bonds are strategically replaced with carbon-hydrogen bonds.

David A. Amsellem: With M D D. In the mix. So that's number one and a number two regarding deuterated limit Chaperoned wanted to get your early thoughts on how are you thinking about the value proposition here in terms of differentiation from the legacy product, particularly on Tolerability and safety given that the current phone.

David A. Amsellem: Luna type aromas extensively pretty well tolerated and seen widely seen as pretty safe within the category. So just wanted to get your thoughts on that thank you.

David A. Amsellem: Right.

Speaker Change: Hi, David Thank you for the question.

Speaker Change: Maybe I'll ask Mark to start out and then I'll take the 12 Lady for.

Speaker Change: Need to ask you to repeat it if I can't remember it by then but let's start with Mark.

Mark: Yeah sure. Thanks for the question David Yeah for the potential label expansion into M. D. D. We would expect a pretty seamless process.

Mark: To the addition of M D D to the label when it comes to pay or access in general with the anti psychotic category.

Speaker Change: <unk> manage these products at the Ah brand level not at the indication level, meaning that whatever your coverage is for the existing indication.

Sharon Mates: So it is a new molecular entity, and it's formulated as an ODTSL to be delivered once a day sublingually. And we have done a phase one program that found that 1284 ODTSL was very rapidly absorbed into the systemic circulation, was metabolically stable, and resulted in high systemic exposure.

Speaker Change: That coverage gets carried over to the new indication as well that's what we experienced when we moved from schizophrenia to the label expansion for bipolar depression, and we've seen similar dynamics with competitive products, who have added M. D D. Two at all.

Speaker Change: Ready existing schizophrenia and bipolar depression.

Speaker Change: Label, So we would expect it to be a fairly similar process and it's about the reason why we expect.

Sharon Mates: So we have, and you were right to point out that lumateparone has a very good safety and tolerability profile. What we have seen with 1284 is that we have seen some things in the PK profile that we think may be even more advantageous, especially as we studied it in a small population of the elderly and other populations based on the PK characteristics that we think make it amenable. And that is so in the elderly populations with Alzheimer's disease and the general population with GAD, so we think, and that's why we're doing these studies. So we do believe that there are some advantages to 1284 over lumateparone.

Speaker Change: To be able to get off to a quick start with that potential approval and M. D D.

Speaker Change: Would that maybe I'll turn it back over to to Sharon for the second question that you had around 12.

Sharon: Great. Thanks, Thanks, a lot suggest for for those listening who may not be familiar with 12 84, Let me just remind everyone that 12 84 is a <unk> where the carbon deuterium bonds are strategically replace the carbon hydrogen bombs.

Sharon: So it is a new molecular and today and it's formulated as an O D. T. S. L to be delivered once a day sublingual Lee.

Sharon: We have done a phase one program that sound that 12, 84 O D. T. S. L was very rapidly absorbed into the systemic circulation was metabolically stable and resulted in high stomach exposure just a minute.

Sharon Mates: And we are doing the studies to confirm that. And we'll keep you apprised of these studies and of the results as we move forward. So thanks a lot for the question. Okay, thanks Sharon. Thank you. One moment for another question, please. Yeah, sure.

Sharon: Sorry.

Sharon: So we have and you're you're you're right to point out that <unk> has a very good safety and Tolerability profile, what we have seen with 12 84 is.

Sharon: That we have seen some things in the P. K profile that we think may be even more advantageous, especially as we studied it in a small population of the elderly.

Operator: Jason, the dynamics that we're seeing in the MDD space for adjunctive antipsychotics are very encouraging to us. In terms of the potential opportunity for Kapalaita in the future, and by that I mean Raylar has had a very successful launch in MDD, significantly growing that market, which is not a surprise to us, but rather is confirmation of what we believe to be a very significant unmet medical need in MDD for an adjunct to anti-psychotics with a good efficacy and safety profile. So we don't believe it's a share grab.

Sharon: And other populations based on the P. K characteristics that we think make it amenable and that is so in the elderly population with Alzheimers disease in the general population G. E. D. So we think and that's why we're doing this study. So we do believe that there are.

Sharon: Some.

Mark Neumann:

Sharon: Advantages to 12 84 over <unk> and we are doing the study to confirm that.

Operator: And we'll keep you apprised of the studies and up the results as we move forward.

Speaker Change: Thanks, a lot for your questions Okay.

Jason: Okay. Thanks Sharon.

Speaker Change: Thank you one moment.

Speaker Change: Question. Please.

Operator: It comes from the line of Jason Carberry with Bank of America. Please proceed.

Mark Neumann: Rex Salty's business does not seem to have been impacted significantly by the launch in Raylar, so we think we're seeing a lot of market growth there. And with successful studies and a successful filing and approval, when we get to the market, we see that as a very, very robust opportunity for Kapalaita for Adjunctive Treatment and MDD. Having said that, you know, we'll see the readouts on these studies, and hopefully, they're both positive. If 1 is positive, and 1, and Misses.

Speaker Change: Okay. Good morning, Thanks for taking my questions first <unk>.

Speaker Change: Okay I just wanted to clarify so is it thinking that you only need one of these three mbd trials, coupled with your mixed feature positive trial to satisfy the extra requirement for the <unk>.

Mark Neumann: Filing I just wanted to get your sense of confidence around that and then <unk> for Mark.

Mark Neumann: <unk> kind of understanding of what's going on in the adjunctive landscape for M. D D.

Mark Neumann: Typical antipsychotic is the regular lunch kind of lifting all boats so to speak with the different atypical or or is there a market share grabbed game I'm just wondering how much of a switch dynamic is involved here with some of the agents. Thanks.

Speaker Change: Right, maybe I'll ask Mark to start and then I'll come in.

Speaker Change: Yeah sure Jason the the dynamics that we're seeing in the MTBE space for adjunctive anti Psychotics is very encouraging to us.

Sharon Mates: It depends on why it missed and how it missed, and the FDA looks at the totality of your evidence. What happens is the FDA does take into account the totality of your evidence. And so, you know, and an example of that is Rexalti, where they had two studies, one hit, one missed, but the FDA looks at the totality of your evidence, and they then decide. And so, I think that's where all of our data, any data you have in, that we have in MDD, will be looked at in our submission. So, I think the very, very strong positive data that we have in our mixed-feature studies can only help, and I'll leave it at that.

Sharon Mates: Terms of the potential opportunity for cap light in the future.

Sharon Mates: I mean <unk> has had a very successful launch an M D D significantly growing that market.

Sharon Mates: Which is not a surprise to us, but rather as confirmation of what we believe to be a very significant unmet medical need in M. D. D for all the junk of anti psychotic with a good Ah efficacy and safety profile. So we don't believe it's a shared Graham.

Sharon Mates: Rexall sees business does not seem to have been.

Sharon Mates: Impacted significantly by the launch and Gray large so we think we're seeing a lot of market growth there.

Sharon Mates: And with successful studies and a successful filing an approval.

Sharon Mates: When we get to the market, we see that is a very very robust opportunity for a couple of items.

Sharon Mates: And to continue on that.

Operator: Okay. Thank you. Thank you. One moment for our next question, please, which comes from the line of Ash Burma with UBS.

Sharon Mates: Answer your first question Uhm R. M. D. D platform is composed of.

Operator: Two studies.

Ash Burma: For the treatment of junk to treatment and M D D.

Operator: Please proceed. Hi, thanks for taking my questions. So maybe just a couple on the pipeline.

Ash Burma: <unk> said that.

Ash Burma: You know, we'll see the Readouts on these studies and hopefully they're both positive.

Ash Burma: One is positive.

Operator: One.

Operator: So for the LAI, I think the press release mentioned that there was some sad data that you had generated. But just what did that show? And what are these four different formulations that you're going after in this new study that you're starting? And then for Lendersporten, so Parkinson's can be a big market with different segmentation. Are you trying to position this as a monotherapy or adjunctive, or is it going after the early or the late stage disease? Okay, maybe Suresh, do you want to start or actually, I can start with the LAI and then turn it over to you for the Lenrose-Poten.

Ash Burma: This is it depends on why it missed and how it Ness N B F D. A looks at the totality of your evidence and that's where you asked about the next teachers. The Knicks features is not part of the adjunctive M. D. D program. However.

Operator: Yet.

Suresh: What happens is the F D. A does take into account the totality of your evidence and so.

Operator: And an example of that is Rick salty, where they had two studies one hit one nest, but.

Speaker Change: D a looks at the totality of your evidence and.

Suresh: Data and alpine and so I think that's where all of our data any data you have in that we have an M. D. D will be looked at in our submission. So I think.

Speaker Change: Very very strong positive data that we had in our next feature studies can only help us.

Sharon Mates: Okay, I'm sorry, guys, I appear to be losing my voice. COUGH. So we did a phase one study, and what the study showed was, in fact, What we want, what we're looking for is a formulation that is good for both the one month and longer duration. The first study showed, first of all, that we can administer it. This was a sub-Q formulation, but it would not be an ideal formulation to go forward with, certainly for greater than one month.

Speaker Change: And I'll leave it at that.

Sharon Mates: [laughter].

Speaker Change: Got it okay. Thank you.

Speaker Change: Thank you one moment for our next question. Please.

Sharon Mates: Comes from the line of Ashbury amount, where do U B S. Please proceed.

Speaker Change: Hi, Thanks for being my questions. So maybe just a couple of pipeline. So for the L. A I think the person you've mentioned that there was some sad data that you had some major just what did what did that show.

Speaker Change: And what are the what are these four different formulations that you're going after in this new study that you're starting and then for Linda Disporting Parkinson can be.

Sharon Mates: Mark had been different segmentation are you trying to position this as a monitor into your account there or is it going after the early or the state disease.

Sharon Mates: So we went back to the drawing board and based on what we heard about a sub-Q formulation versus other types of formulations like IM, also based on site of injection. And so the four formulations that we have prepared look at both SubQ versus IM and the site of administration and look at the ability to deliver the molecule over both a one month and longer duration. So that's the answer to your first question. And maybe, Suresh, would you like to talk about our Parkinson's study and the patient population? Yes, so the Parkinson's study, the Lindus Podium, Lindus spodum, that study is a study in Parkinson's disease. We are looking at populations where the primary objective is to look at efficacy of Lindus spodum as administered once daily as an adjunctive treatment to existing liver topotherapy.

Sharon Mates: Thanks.

Sharon Mates: Okay, maybe Suresh do you want to start.

Suresh: Or actually I can start with the L. A I and then turn it over to you for the <unk> mm Okay [noise].

Suresh: I'm, sorry, if I appear to be losing my voice.

Sharon Mates: [noise].

Suresh: So we did I'd say, it's one study and what study showed was in fact.

Suresh: What <unk>, what we're looking for is a formulation that is good for both the one month and longer duration.

Suresh: The first study so first of all we can administer it this was a subcu formulation, but it would not be an ideal formulation to go forward with certainly for greater than one month. So we went back to the drawing board and based on what we heard about.

Suresh: Subcu formulation.

Suresh: Uhm verses other types of formulations like I am also based on sight of injection.

Suresh: And so the four formulations that we have prepared <unk>.

Suresh: Look at both.

Sumant Kulkarni: So the patients must be on stable doses of existing liver topotherapy, and our primary end point there is looking at the Hauser diary, which is increasing on time without troublesome dysskinesia.

Suresh: Q versus I M and a side of administration and looking at the ability to deliver.

Sumant Kulkarni: Uhm.

Suresh: The molecule.

Sumant Kulkarni: Over.

Suresh: Both a one month and longer duration.

Suresh: So that's the answer your first question and and maybe some rash do you want to talk about our Parkinson's study and.

Sumant Kulkarni: We also are looking at the Motor Aspects, MDS-UPDRS, Part 2 of Activities of Daily Living. In that study, we are also measuring other multiple things. One, looking at measurements in cognition. We're also looking at several biomarkers of inflammation. This is important for both Parkinson's and also looking at programs outside of the CNS. And once we look at the data, based on... The Movement Measurements, Cognition, and Inflammation

Sumant Kulkarni: Populate.

Suresh: Yes, so the Bumpkins Australia for them.

Sumant Kulkarni: Linda.

Sumant Kulkarni: He's a study in Parkinson's disease.

Sumant Kulkarni: Looking at populations, where the primary objective is to look at <unk> at administered once daily as an adjunct to treatment too.

Sumant Kulkarni: The existing levodopa therapy, so the patients must be unstable doses of existing levodopa therapy.

Sumant Kulkarni: And our primary <unk>.

Sumant Kulkarni: Is looking at How's the baby.

Sumant Kulkarni: That is increasing on time without.

Sumant Kulkarni: Troublesome just finished yes, we also I'm looking at the <unk> aspects N D. S. U P. D. R S.

Sumant Kulkarni: To activities of daily living.

Sumant Kulkarni: Our next studies will look into defining what the path forward will be for this program. Great, thank you. Thank you. One moment for our next question, please. And it's from the line of Sumant Kulkarni with Canaccord Genuity.

Sumant Kulkarni: And that's pretty weird also measuring other multiple things one looking at the magenta mentioned in cognition.

Sumant Kulkarni: But also looking at several biomarker inflammation.

Sumant Kulkarni: This is important for both Boston since I'm also looking at.

Sumant Kulkarni: Programs outside of the C N S.

Sumant Kulkarni: And once we looked at the data based on.

Operator: Please proceed. Morning, great to see all the progress and thanks for taking my question. I'm going to ask a bigger picture one.

Sumant Kulkarni: The moment measurements cognition and inflammation. Our next studies will look into finding a lot but.

Operator: On your MDD program, you're clearly putting a lot of resources behind it. So for the benefit of investors, what would be the latest and most accurate characterization from within the company on whether you view the addition of the MDD indication as a nice-to-have for Limit Wraparound, given the size of the market and unmet need, or is it more of a strategic imperative? Hi, Sumant. That's an interesting question. Maybe...

Sumant Kulkarni: We're going to be for this project.

Operator: Mmm.

Speaker Change: Okay. Thank you.

Speaker Change: Thank you one moment for our next question. Please.

Speaker Change: And he's from the line of <unk> Carney with kind of chords and 90. Please proceed.

Speaker Change: Great to see all the progress and thanks for taking my question I'm Gonna ask a bigger picture one on your Mbd program, you're clearly putting a lot of resources behind it up so for the benefit of investors what would be the latest and most accurate characterization from within the company on whether you view. The addition of the M. D D indication as a nice to have a limit on given the size of the market and I might need.

Speaker Change: Or is it more of a strategic competitive for the company.

Sumant Kulkarni: Hi, Smart that's an interesting question maybe.

Mark Neumann: I don't know, Mark. Would you like to start from a commercial perspective and then we can chime in? Yeah, sure. That is a very interesting, interestingly phrased question, Sumant.

Mark Neumann: I Dunno, Mark would you like to start.

Speaker Change: No commercial <unk> and then we can try man.

Mark Neumann: Yeah sure that that is a very interesting interestingly phrased question Tomorrow, and I would I guess, what I would say is.

Mark Neumann: And I guess what I would say is, we believe with our current business in schizophrenia and bipolar depression, we are still in the early innings of tapping into the opportunity for capillata, and we see tremendous opportunities for continued growth in bipolar depression as we continue to penetrate that market. Certainly, MDD is equally a large opportunity with significant opportunities for growth, as I just mentioned in answering one of the previous questions, and we would certainly be excited to add that to our label and have the opportunity to bring capillata to physicians and patients in the area of MDD as well. I have nothing to add.

Mark Neumann: We believe with our current business and schizophrenia and bipolar depression, we are still in the early innings of tapping into the opportunity four capp lighter and we see tremendous opportunities for continued growth in bipolar depression as we continue to penetrate that market certainly.

Mark Neumann: M D D is equally a large opportunity.

Mark Neumann: With a significant opportunities for growth as I, just mentioned in answering one of the previous questions.

Mark Neumann: And we would certainly be excited to add that to.

Mark Neumann: Our label and have the opportunity to brain capital Ida too physicians and patients in the area of M D D as well.

Operator: I think a well-stated and well-stated position of the company. Thank you, and one moment for our last question in the queue. It comes from the line of Ami Fadia with Needham and Company.

Mark Neumann: I have nothing to add I think.

Operator: Well stated well stated position of the company.

Operator: <unk>.

Ami Fadia: Thank you and one moment for our last question in the queue.

Ami Fadia: It comes from the line of Ami Fattier with meet him in company. Please proceed.

Operator: Please proceed. Good morning, thanks for taking my question and congratulations on all the progress. My question is more of a clarification question on your comments on the MDD regulatory plan. Would you say that if one study hits and the other misses, you would still go in for a regulatory submission without waiting for the third one to read out? And then also just going back and thinking about mixed features.

Speaker Change: Thanks for taking my question and congrats on all the progress. My question is more of a clarification question on your comments on the N D D.

Operator: Plan.

Operator:

Operator: Would you say that is one study has sent the other message.

Glynn: Still glynn.

Operator: Permission without waiting for the third one to read out and then also just going back and thinking about next feature.

Sharon Mates: What's your latest thinking about the regulatory path forward, and could you use some of the data from the NDD studies that are going to be reading out to pursue a specific label in mixed features? Thank you. Hi Ami, thanks for the question.

Operator: What's your latest thinking about the <unk> and could you use some of the data from the N. D. D studies that are going to be leading out to pursue a specific.

Speaker Change: Specific label in <unk>. Thank you.

Speaker Change: [noise] Hi on me thanks for the question.

Sharon Mates: I think it's a little too early to comment on how we're going to proceed until we know what the data is, okay? I will tell you that obviously, two positive studies. We proceed as planned. One positive study and one negative study. Again, it really, really depends. It really depends on. What Happened? Why You Missed It?

Sharon Mates: I think it's a little too early to comment on.

Sharon Mates: How we're gonna.

Sharon Mates: Proceed until we know what the data is.

Sharon Mates: Okay I will tell you that obviously two positive studies.

Sharon Mates: We proceed as planned one positive study and one negative study again, it really really depends.

Sharon Mates: It really depends on.

Sharon Mates: What happened why you missed whether or not.

Sharon Mates: whether or not, and we would always submit all of our data to the FDA as soon as we can. So I think it's a little bit too soon to answer your questions on what happens if, because it depends on what the data says. And I think we can leave it at that. There may have been, was there another question in there, or are we good?

Sharon Mates: We we would we always submit all of our data to the F. D. A as soon as we can so I think it's a little bit too soon to answer.

Sharon Mates: Your questions on what happens if cause it depends on what the data says.

Sharon Mates: And I think we can leave it at that.

Sharon Mates:

Sharon Mates: There may have been was there another question in there or we could my question was also regarding mixed speeches and what's your latest thinking there is.

Sharon Mates: My question was also regarding mixed speeches and what your latest thinking there is. As we said in our prepared remarks, we did have a very constructive meeting with the FDA and, as always, we wait for our minutes. And once we have our minutes, we'll, we'll come back to you.

Sharon Mates: Oh as we said.

Sharon Mates: And are prepared remarks that we did have a very constructive meeting with the F D. A and as always we wait for a minute.

Sharon Mates: Thanks for joining us. We hope you have a great day. Operator, I think there may be another question.

Sharon Mates: Once we have our minutes well, we'll come back to you.

Sharon Mates: Mmm.

Sharon Mates: Operator.

Operator: Yes, we have time for one more question. One moment, please. And it's from Charles Duncan with Cantor Fitzgerald. Please proceed. Hey, good morning, Sharon, and team. Congratulations on a good year. And thanks for taking our questions. I'm hopping between calls.

Speaker Change: Other questions. We have time for one more question one moment please [noise].

Operator: And he's from Charles Duncan with contour Fitzgerald. Please proceed.

Charles Duncan: Hey, good morning, Sharon and team congrats on a good year and thanks for taking our questions. So I'm I'm happened between calls so sorry, if this has already been addressed.

Operator: I am sorry if this has already been addressed, but I wondered what your perspectives were with regard to the possibility of muscarinic agonists being approved for monotherapy in schizophrenia later this year. And I guess I'm wondering if you could provide us with a little bit of color on your preparation in terms of the differentiation of Kaplita relative to those candidates and how you're addressing the prescriber base at this point. Mark, do you want to take that? Yeah, sure, Charles.

Mark Neumann: I've wondered what your perspectives were with regards to the possibility of muscarinic egg N as being approved for mono therapy and schizophrenia. Later on this year and I guess I'm wondering if you could provide us a little bit of color on your preparation in terms of differentiation of.

Mark Neumann: Of kept later relative to those candidates and how you're.

Mark Neumann: Addressing the prescriber base at this point.

Operator: Mark do you Wanna take that.

Mark Neumann: Yeah sure Charles So we have a great deal of confidence in the product that we have in capp lighter, we feel across both schizophrenia and bipolar depression received very strong efficacy of very favorable safety and tolerability profile and the dosing regimen that physicians.

Mark Neumann: So, we have a great deal of confidence in the product that we have in CAPLITO. We feel that across both schizophrenia and bipolar depression, we see very strong efficacy, a very favorable safety and tolerability profile, and a dosing regimen that physicians and patients really like. And, you know, our focus is on educating physicians and patients to make sure that they're aware of CAPLITO, they understand the potential benefits of CAPLITO for their patients, and so that's where we put our energy. New products potentially being added to the mix for physicians is always a good thing. For patients, as you know, in this category, there's a tremendous amount of churn, what we call churn, meaning patients try one therapy, often prior to CAPLITO, they would experience side effects either on the movement disorder side or on the metabolic side, and so they cycle through multiple different products.

Mark Neumann: And patients.

Mark Neumann: Really like and our focus is on educating physicians and patients.

Mark Neumann: To make sure that they are aware of capital I'd, they understand a potential benefits of cap lighter for their patients and so that's where we put our energy.

Mark Neumann: New new products potentially being added to the mix for physicians is always a good thing for patients as you know in this category.

Mark Neumann: There's a tremendous amount of churn, what we call churn meaning patients.

Mark Neumann: Try one therapy, often prior to capitalize they would experience.

Mark Neumann: Side effects, either on the movement disorder side or on the metabolic size and so they cycled through multiple different products. So for them to have another option.

Sharon Mates: So for them to have another option to choose from is always a good thing for patients. I would say for us, more and more of our business, as we've talked about in the past, is coming from bipolar depression, and in the future, with a successful MDD study, as we just talked about, would be coming from that area as well. So we don't see a significant impact on the amount of business of any new entrants coming into the market. So I hope that I hope that addresses your question. Right?

Sharon Mates: To to choose from is always a good thing for for patients I I would say for us more and more of our business as we've talked about in the past is coming from bipolar depression and in the future with a successful.

Sharon Mates: Mbd study as we just talked about would be coming from that area as well so.

Sharon Mates: So we don't see a significant impact on the cap light a business of any new entrants coming into the into the market. So I hope that hope that a drink with your question Charles and.

Sharon Mates: And I would like to just add to that that we agree. And we, as a company, think any new product that can help patients is great for patients. And as Mark said, especially in schizophrenia, these patients cycle through these products. It is part of the disease state. So, we think it can be a benefit to patients, and that's terrific. Now, having said that, there are 2.4 million patients with schizophrenia. There are four to five times that number of patients with bipolar depression, and there are even more patients with MDD.

Speaker Change: Yes. It is.

Sharon Mates: Add to that but.

Speaker Change: I agree.

Sharon Mates: And we have the <unk>.

Sharon Mates: Company cause any new product that can help patients uhm is great for patience and as Mark said.

Sharon Mates: Especially in schizophrenia these patients cycle through these products.

Sharon Mates: Part of the disease state.

Sharon Mates: So <unk>.

Sharon Mates: But we think it can be a benefit to patients and that's terrific now having said that there are 2.4 million patients with schizophrenia.

Sharon Mates: There is four to five times that patient five.

Sharon Mates: <unk>.

Sharon Mates: Depression, and there are even more patience with M D J.

Mark Neumann: And our business... is growing in the Bipolar, and we expect that to continue. So, as Mark said, as a summary statement, we really do not expect this to really impact our business head-on. That makes sense, Sharon and Mark, and it doesn't appear that those agents impact depression at all. So, clear differentiation. One quick point of clarification, though, given what's going on with regard to acquisitions, I think I know the answer to this question, but the small royalty that you pay to Bristol-Myers that is paid to that company without any input on their part, you just send them a check. They have no role in marketing Capleta at this point, right? They have no role in marketing Capleta.

Mark Neumann: Our business.

Mark Neumann: Is growing.

Mark Neumann: In the bipolar.

Mark Neumann: Space and we expect that to continue so I as Mark seven as a summary statement, we really do not expect us to really impact our business.

Mark Neumann: At all.

Speaker Change: That makes sense, Sharon and Edmark and it doesn't appear that those agents impact depression at all so.

Mark Neumann: Differentiation, one quick point of clarification, though given up what's going on.

Mark Neumann: With regard to acquisitions could I think I know the answer to this question, but the small royalty that you paid a Bristol Myers that is paid to that company without any input on their part you just send them a check they have no role in in marketing cancel it at this point.

Mark Neumann: Okay, thanks. Thank you, and with that, ladies and gentlemen, we conclude the Q&A answer period. I will turn to Dr. Sharon Mates for final comments. Thank you, everyone, for joining our call this morning. I know that we're a little bit over on time, so I'll make it very brief. I think we are very proud of. Our performance during 2023, and we're really looking forward to 2024 and look forward to updating everybody as we go forward.

Mark Neumann: [noise] they have no role in marketing <unk>.

Speaker Change: Okay. Thanks.

Speaker Change: Thank you and with that ladies and gentlemen, we conclude the Q&A answer period, I will turn to talk to Sharon mates for final comments.

Speaker Change: Thank you everyone for joining us Thomas.

Speaker Change: I know that we're a little bit over in time, so I'll make it very <unk>.

Speaker Change: I think we are very proud of.

Speaker Change: Our performance during 2023, and we're really looking forward to 2024.

Speaker Change: And look forward to updating everybody as we go forward so.

Sharon Mates: So thanks again for joining the call, and with that operator, you can disconnect. Thank you everybody for joining our call today. You may now disconnect. Thank you for watching!

Sharon Mates: Scam for joining the call in with that operator.

Speaker Change: You can disconnect.

Sharon Mates: Thank you everybody for joining our call today you may now disconnect.

Sharon Mates: Mmm.

Sharon Mates: [music].