Q2 2024 Alkermes PLC Earnings Call

Rob: Greetings and welcome to the Alkermes second quarter 2024 financial results conference call. My name is Rob, and I'll be your operator for today's call. All participant lines will be placed on mute to prevent background noise. If you should require operator assistance during the call, please press star zero on your telephone keypad. Please note, this conference is being recorded. I'll now turn the call over to Sandra Coombs, Senior Vice President of Investor Relations and Corporate Affairs. Sandy, you may now begin.

Operator: Greetings and welcome to the Alkermes 2nd Quarter 2024 Financial Results Conference Call.

Rob: Greetings and welcome to the Alkermes second quarter 2024 financial results conference call. My name is Rob and I'll be your operator for today's call.

Operator: My name is Robyn O'Bee; you're operator for today's call. I'll participate once we place on mute to remember background noise. If you should require operator assistance during the call, please press star zero from your telephone keypad.

Speaker Change: All participant lines will be placed on mute to prevent background noise.

Speaker Change: If you should require operator assistance during the call, please press star zero from your telephone keypad. Please note this conference is being recorded.

Operator: Please note this conference is being recorded.

Sandra Coombs: I'll now turn the call over to Sandra Coombs, Senior Vice President of Investor Relations and Corporate Affairs. Sandy, you may now begin.

Speaker Change: I'll now turn the call over to Sandra Coombs, Senior Vice President of Investor Relations and Corporate Affairs. Sandy, you may now begin.

Sandra Coombs: Thank you. This is the Alkermes Plc conference call to discuss our financial results and business update for the quarter-ended June 30, 2024. With me today are Richard Pops, our CEO; Todd Nichols, our Chief Commercial Officer; and Blair Jackson, our Chief Operating Officer. During today's call, we will be referencing slides. These slides, along with our press release, related financial tables, and reconciliations of the GAAP to non-GAAP financial measures that we'll discuss today, are available in the investor section of Alkermes.com.

Sandra Coombs: Thank you.

Sandra Coombs: Welcome to the Alkermes PLC conference call to discuss our financial results and business update for the quarter-ended June 30th, 2024. With me today are Richard Popps, our CEO, Todd Nichols, our Chief Commercial Officer, and Blair Jackson, our Chief Operating Officer. During today's call, we will be referencing slides. These slides, along with our press release, related financial tables, and reconciliation of the gap to non-gap financial measures that we'll discuss today, are available on the investor section of Alkermes.com. We believe the non-GAAP financial results, in conjunction with the GAAP results, are useful in understanding the ongoing economics of our business.

Sandra Coombs: Thank you. Welcome to the Alkermes Plc conference call to discuss our financial results and business update for the quarter-ended June 30, 2024. With me today are Richard Pops, our CEO , Todd Nichols, our Chief Commercial Officer, and Blair Jackson, our Chief Operating Officer.

Speaker Change: During today's call, we will be referencing slides. These slides, along with our press release, related financial tables, and reconciliations of the GAAP to non-GAAP financial measures that we'll discuss today are available on the investor section of Alkermes.com.

Sandra Coombs: We believe the non-GAAP financial results, in conjunction with the GAAP results, are useful in understanding the ongoing economics of our business. Our discussions during this conference call will include forward-looking statements. Actual results could differ materially from these forward-looking statements. Please see slides two and three of the accompanying presentation, our press release issued this morning, and our most recent annual and quarterly reports filed with the SEC for important risk factors that could cause our actual results to differ materially from those expressed or implied in the forward-looking statements.

Speaker Change: We believe the non-GAAP financial results in conjunction with the GAAP results are useful in understanding the ongoing economics of our business.

Sandra Coombs: Our discussions during this conference call will include forward-looking statements. Actual results could differ materially from these forward-looking statements. Please see slide two of the accompanying presentation, our press release issued this morning, and our most recent annual and quarterly reports filed with the SEC for important risk factors that could cause our actual results to differ materially from those expressed or implied in the forward-looking statements. We undertake no obligation to update or revise the information provided on this call or in the accompanying presentation as a result of new information or future results or development.

Speaker Change: Our discussions during this conference call will include forward-looking statements. Actual results could differ materially from these forward-looking statements.

Speaker Change: Please see slide 2 of the accompanying presentation, our press release issued this morning, and our most recent annual and quarterly reports filed with the SEC for important risk factors that could cause our actual results to differ materially from those expressed or implied in the forward-looking statements.

Sandra Coombs: We undertake no obligation to update or revise the information provided on this call or in the accompanying presentation as a result of new information or future results or developments. After our prepared remarks, we'll open the call for Q&A, and now I'll turn the call over to Blair for a review of the quarterly financial results.

Speaker Change: We undertake no obligation to update or revise the information provided on this call or in the accompanying presentation as a result of new information or future results or developments. After our prepared remarks, we will open the call for Q&A, and now I'll turn the call over to Blair for a review of the quarterly financial results.

Blair Jackson: After our prepared remarks, we will open the call for Q&A, and now I'll turn the call over to Blair for a review of the quarterly financial results.

Blair Jackson: Thank you, Sandy. Our second quarter results reflect robust profitability and solid execution across our business, delivering double-digit year-over-year growth for our proprietary commercial product portfolio. The year is proceeding as planned, and we enter the second half in a strong position with clear priorities to deliver on our 2024 financial expectations, which we are reiterating today. For the second quarter, we generated total revenues of $399.1 million, driven by our proprietary product portfolio, which grew 16% year-over-year. Starting with Bivitral, net sales in the quarter, or $111.9 million, compared to $102.1 million in the same period last year. For the Aristotle product family, net sales were $86 million, compared to $82.4 million for the same period last year.

Blair C. Jackson: Thank you, Sandy. Our second quarter results reflect robust profitability and solid execution across our business, delivering double-digit year-over-year growth for our proprietary commercial product portfolio. The year is proceeding as planned, and we enter the second half in a strong position with clear priorities to deliver on our 2024 financial expectations, which we are reiterating today. For the second quarter, we generated total revenues of $399.1 million, driven by our proprietary product portfolio, which grew 16% year over year.

Blair: Thank you, Sandy. Our second quarter results reflect robust profitability and solid execution across our business, delivering double-digit year-over-year growth for our proprietary commercial product portfolio.

Speaker Change: The year is proceeding as planned, and we enter the second half in a strong position with clear priorities to deliver on our 2024 financial expectations, which we are reiterating today.

Blair: For the second quarter, we generated total revenues of $399.1 million, driven by our proprietary product portfolio, which grew 16% year over year.

Blair C. Jackson: Starting with Vivitrol, net sales in the quarter were $111.9 million compared to $102.1 million in the same period last year. For the Aristotle product family, net sales were $86 million compared to $82.4 million for the same period last year. For Livalvy, net sales were $71.4 million compared to $47 million for the same period in the prior year, which represented 52% year-over-year growth driven by robust underlying demand. Across our proprietary commercial products, inventory in the channel returned to normal levels on a month's on-hand basis during the second quarter, following the drawdown we experienced in the first quarter of this year.

Blair: Starting with Vivitrol, net sales in the quarter were $111.9 million compared to $102.1 million in the same period last year.

Blair: For the Aristotle product family, net sales were $86 million compared to $82.4 million for the same period last year.

Blair Jackson: For LeBalvey, net sales were $71.4 million, compared to $47 million for the same period in the prior year, which represented 52% year-over-year growth driven by robust underlying demand. Across our proprietary commercial products, inventory in the channel returned to normal levels on a month-on-hand basis during the second quarter, following the drawdown we experienced in the first quarter of this year. Moving on to our manufacturing and royalty business, in the second quarter of 2024, we recorded manufacturing and royalty revenues of $129.9 million. Revenues from the long-acting and vague products were $78.7 million, compared to $321.2 million for Q2 last year, which included $245.5 million of back royalties and related interest following the successful resolution of our arbitration with the end.

Blair: For Lobalvi, net sales were $71.4 million compared to $47 million for the same period in the prior year, which represented 52% year-over-year growth driven by robust underlying demand.

Blair: Across our proprietary commercial products, inventory in the channel returned to normal levels on a months on hand basis during the second quarter, following the drawdown we experienced in the first quarter of this year.

Blair C. Jackson: Moving on to our manufacturing and royalty business, in the second quarter of 2024, we recorded manufacturing and royalty revenues of $129.9 million. Revenues from the long-acting and vega products were $78.7 million compared to $321.2 million for Q2 last year, which included $245.5 million of back royalties and related interest following the successful resolution of our arbitration with Yancey. As previously disclosed and reflected in our financial expectations for the year, our royalties and net sales of Invega Sustana in the U.S. will end in mid-August of this year.

Blair: Moving on to our manufacturing and royalty business, in the second quarter of 2024, we recorded manufacturing and royalty revenues of $129.9 million.

Blair: Revenues from the Long Acting and Vega products were $78.7 million compared to $321.2 million for Q2 last year.

Blair: which included $245.5 million of back royalties and related interests following the successful resolution of our arbitration with Janssen.

Blair Jackson: As previously disclosed and reflected in our financial expectations for the year, our royalties and net sales have been vagus sustaining in the U.S.

Blair: As previously disclosed and reflected in our financial expectations for the year, our royalties and net sales of Invegas Astana in the U.S. will end in mid-August of this year. We expect the impact on our third quarter results will be approximately $20 million.

Blair Jackson: will end in mid-August of this year. We expect the impact on our third quarter results will be approximately 20 million dollars. We will continue to receive royalties on net sales of in Vega Trinza and in Vega Halfiara in the U.S. and on the long acting in Vega products outside the U.S. Revenue's from Vumerity were $35.2 million, compared to $32.3 million dollars for Q2 last year.

Blair C. Jackson: We expect the impact on our third-quarter results will be approximately $20 million. We will continue to receive royalties on net sales of Invega Trinza and Invega Halfiera in the U.S. and on the long-acting Invega products outside the U.S.

Blair: We will continue to receive royalties on net sales of Invega Trinza and Invega Hafjera in the U.S. and on the long-acting Invega products outside the U.S.

Blair C. Jackson: Revenues from Umerity were $35.2 million compared to $32.3 million for Q2 last year. Now I'll turn to our operating expenses and our financial results from continuing operations following the separation of our oncology business late last year. Cost of goods sold was $61.5 million compared to $63.2 million for Q2 last year. R&D expenses were $59.6 million compared to $68.2 million for Q2 last year. This reflects focused investments in our neuroscience development programs, primarily related to the ALCS 2680 Clinical Program, and support activities for our proprietary commercial products.

Blair: Revenues from Umerity were $35.2 million compared to $32.3 million for Q2 last year.

Blair C. Jackson: We expect R&D expense to remain relatively steady at this level through the end of the year. SG&A expenses were $168.1 million compared to $195.8 million for Q2 last year. The decrease was primarily driven by operational efficiencies and a number of non-recurring expenses that were recorded in the second quarter of 2023. Looking ahead, we continue to expect SG&A expenses to decrease in the second half of 2024, primarily reflecting the timing and mix of commercial promotional activities.

Blair Jackson: Now I'll turn to our operating expenses and our financial results from continuing operations following the separation of our oncology business late last year. Cost of goods sold were $61.5 million, compared to $63.2 million dollars for Q2 last year. Our in the expenses were $59.6 million, compared to $68.2 million dollars for Q2 last year. This reflects focused investments in our neuroscience development programs, primarily related to the Alk's 2680 clinical program and support activities for our proprietary commercial products. We expect our in the expense to remain relatively steady at this level through the end of the year.

Blair: Now I'll turn to our operating expenses and our financial results from continuing operations following the separation of our oncology business late last year.

Blair: Cost of goods sold were $61.5 million compared to $63.2 million for Q2 last year.

Blair: R&D expenses were $59.6 million compared to $68.2 million for Q2 last year.

Blair: This reflects focused investments in our neuroscience development programs, primarily related to the ALCS 2680 Clinical Program and support activities for our proprietary commercial products. We expect R&D expense to remain relatively steady at this level through the end of the year.

Blair Jackson: SGA expenses were $168.1 million, compared to $195.8 million dollars for Q2 last year. The decrease was primarily driven by operational efficiencies in a number of non-recurring expenses that were recorded in the second quarter of 2023. Looking ahead, we continue to expect SGA expenses to decrease in the second half of 2024, primarily reflecting the timing and mix of commercial promotional activities. We continue to focus on driving profitability, and during the second quarter, we deliver gap net income from continuing operations of 94.7 million dollars. Non-GAAP net income from continuing operations of 123.4 million dollars and EBITDA from continuing operations of 118.6 million dollars.

Blair: SG&A expenses were $168.1 million compared to $195.8 million for Q2 last year. The decrease was primarily driven by operational efficiencies and a number of non-recurring expenses that were recorded in the second quarter of 2023.

Blair: Looking ahead, we continue to expect SG&A expenses to decrease in the second half of 2024, primarily reflecting the timing and mix of commercial promotional activities.

Blair C. Jackson: We continue to focus on driving profitability, and during the second quarter, we delivered GAP net income from continuing operations of $94.7 million, non-GAAP net income from continuing operations of $123.4 million, and EBITDA from continuing operations of $118.6 million. Turning to our balance sheet, we ended the second quarter in a strong financial position with $962.5 million in cash and total investments. In May, we completed the sale of our Athlone Ireland manufacturing facility to Novo Nordisk and received a cash payment of approximately $91 million for the facility and related assets.

Blair: We continue to focus on driving profitability, and during the second quarter we deliver GAP net income from continuing operations of $94.7 million.

Blair: Non-Gap Net Income from continuing operations of $123.4 million and EBITDA from continuing operations of $118.6 million.

Blair C. Jackson: Turning to our balance sheet, we ended the second quarter in a strong financial position with $962.5 million dollars in cash and total investments. In May, we completed the sale of our Apple and Ireland manufacturing facility to Noble Nordisk and received a cash payment of approximately 91 million dollars for the facility in related assets. This transaction represents a key element of our multi-year strategy to drive operational efficiency and further align our infrastructure and cost framework with the anticipated needs of the business. Additionally, as part of the $400 million repurchased program authorized late earlier this year, the company repurchased approximately 3.5 million of our outstanding shares during the quarter for an aggregate purchase price of $84.7 million.

Blair: Turning to our balance sheet, we ended the second quarter in a strong financial position with $962.5 million in cash and total investments.

Blair: In May, we completed the sale of our Athlone Ireland manufacturing facility to Novo Nordisk and received a cash payment of approximately $91 million for the facility and related assets.

Blair C. Jackson: This transaction represents a key element of our multi-year strategy to drive operational efficiency and further align our infrastructure and cost framework with the anticipated needs of the business. Additionally, as part of the $400 million share repurchase program authorized earlier this year, the company repurchased approximately $3.5 million of our outstanding shares during the quarter for an aggregate purchase price of $84.7 million, and we have since continued to be actively repurchasing shares opportunistically in the market.

Blair: This transaction represents a key element of our multi-year strategy to drive operational efficiency and further align our infrastructure and cost framework with the anticipated needs of the business.

Blair: Additionally, as part of the $400 million share repurchase program authorized earlier this year, the company repurchased approximately $3.5 million of our outstanding shares during the quarter for an aggregate purchase price of $84.7 million.

Blair Jackson: And we have since continued to be actively repurchasing shares offered it opportunistically in the market.

Blair: And we have since continued to be actively repurchasing shares opportunistically in the market.

Blair Jackson: Taking a step back, we are pleased with the progress we have made as we've continued to deliver on our multi-year plan to streamline the business and strengthen our financial operating profile while advancing out to 2680 rapidly in the clinic. As we look at the second half of the year, we're in a strong financial position as we work to execute on our strategic priorities, drive momentum across our business, and deliver robust profitability.

Blair C. Jackson: Taking a step back, we are pleased with the progress we have made as we've continued to deliver on our multi-year plan to streamline the business and strengthen our financial operating profile while advancing ALK2680 rapidly in the clinic. As we look at the second half of the year, we are in a strong financial position as we work to execute on our strategic priorities, drive momentum across our business, and deliver robust profitability. With that, I'll now hand the call to you.

Blair: Taking a step back, we are pleased with the progress we have made as we've continued to deliver on our multi-year plan to streamline the business and strengthen our financial operating profile, while advancing ALCS 2680 rapidly in the clinic.

Blair: As we look at the second half of the year, we're in a strong financial position as we work to execute on our strategic priorities, drive momentum across our business, and deliver robust profitability. With that, I'll now hand the call to Todd.

Unknown Executive: With that, I'll now hand the call.

Todd Nichols: Thank you, Blair, and good morning, everyone. We generated strong growth for our proprietary product portfolio in the second quarter. This was an important priority for our annual plan, and we delivered on that objective. During the quarter, our team drove net sales of our proprietary product portfolio of $269.3 million, reflecting 16% year-to-year growth. With two remaining quarters in the year, we are on track to achieve our previously announced financial expectations of our proprietary net sales and excess of $1 billion in 2024.

Unknown Attendee: Thank you, Blair, and good morning, everyone. We generated strong growth for our proprietary product portfolio in the second quarter. This was an important priority for our annual plan, and we delivered on that objective. During the quarter, our team drove net sales of our proprietary product portfolio of $269.3 million, reflecting 16% year-over-year growth. With two remaining quarters in the year, we are on track to achieve our previously announced financial expectations of our proprietary net sales in excess of $1 billion in 2024. I'll focus on Libavi, followed by quick updates on Vivitrol and Aristotle.

Todd: Thank you Blair, and good morning everyone.

Todd: We generated strong growth for our proprietary product portfolio in the second quarter. This was an important priority for our annual plan and we delivered on that objective.

Todd: During the quarter, our team drove net sales of our proprietary product portfolio of $269.3 million.

Todd: Reflecting 16% year-over-year growth.

Todd: With two remaining quarters in the year, we are on track to achieve our previously announced financial expectations of our proprietary net sales in excess of $1 billion in 2024.

Todd Nichols: I'll focus on LeBalvy followed by quick updates on Vivitrol and Aristotle. During the second quarter, we generated LeBalvy net sales of $71.4 million. Total prescriptions of LeBalvy grew 12% sequentially and 44% year-to-year to approximately $55,300 during the quarter. Reflecting strong underlying demand and continued expansion of prescriber breadth and depth. Optimizing LeBalvy's access profile continues to be an important element of our long-term growth strategy for the brand, and compared to the beginning of the year, approximately 50 million additional lives now have improved access to LeBalvy. These enhancements are the result of our discipline contracting strategy. During the quarter, we entered into a second major commercial contract, as well as a contract to further improve formulary positioning on an important Medicare Part D plan, both of which took effect on July 1st.

Todd: I'll focus on Livalvi, followed by quick updates on Vivitrol and Aristata.

Unknown Attendee: During the second quarter, we generated revolving net sales of $71.4 million. Total prescriptions of Libalvi grew 12% sequentially and 44% year-over-year to approximately 55,300 during the quarter, reflecting strong underlying demand and continued expansion of prescriber breadth and depth. Optimizing Libalvi's access profile continues to be an important element of our long-term growth strategy for the brand, and compared to the beginning of the year, approximately 50 million additional lives now have improved access to Libalvi.

Todd: During the second quarter, we generated revolving net sales of $71.4 million.

Todd: Total prescriptions of Libalvi grew 12% sequentially and 44% year-over-year to approximately 55,300 during the quarter, reflecting strong underlying demand and continued expansion of prescriber breadth and depth.

Todd: Optimizing Libalbi's access profile continues to be an important element of our long-term growth strategy for the brand. And compared to the beginning of the year, approximately 50 million additional lives now have improved access to Libalbi.

Unknown Attendee: These enhancements are the result of our disciplined contracting strategy. During the quarter, we entered into a second major commercial contract, as well as a contract to further improve formulary positioning on an important Medicare Part D plan, both of which took effect on July 1st. Similar to the commercial contract we announced last quarter, these contracts are not expected to significantly impact our anticipated gross to net adjustment. Looking ahead, for the full year, we continue to expect revolving net sales in the range of $275 to $295 million.

Todd: These enhancements are the result of our disciplined contracting strategy.

Todd: During the quarter, we entered into a second major commercial contract, as well as a contract that further improved formulary positioning on an important Medicare Part D plan.

Todd Nichols: Similar to the commercial contract we announced last quarter, these contracts are not expected to significantly impact our anticipated growth net adjustments. Looking ahead, for the full year we continued to expect LeBalvy net sales in the range of $275 to $295 million.

Todd: Both of which took effect on July 1st.

Todd: Similar to the commercial contract we announced last quarter, these contracts are not expected to significantly impact our anticipated gross to net adjustments.

Todd: Looking ahead, for the full year we continue to expect revolving net sales in the range of $275 to $295 million.

Todd Nichols: Turning to the Aristotle product family, net sales in the second quarter were $86 million. While the long-acting anti-psychotic market experienced some softness, Aristotle and new to brand prescriptions demonstrated encouraging growth. For the full year, we continued to expect Aristotle and net sales in the range of $340 to $360 million. As we focused on commercial execution and continued to differentiate Aristotle and the long-acting anti-psychotic space.

Unknown Attendee: Turning to the Aristata product family, net sales in the second quarter were $86 million. While the long-acting anti-psychotic market experienced some softness, Aristata's new-to-brand prescriptions demonstrated encouraging growth. For the full year, we continue to expect Aristotle net sales in the range of $340 to $360 million as we focus on commercial execution and continue to differentiate Aristotle in the long-acting anti-psychotic space. Moving to Vivitrol, net sales in the second quarter were at $111.9 million, representing 10% year-over-year growth driven by underlying demand.

Todd: Turning to the Aristotle product family, net sales in the second quarter were $86 million.

Todd: While the long-acting antipsychotic market experienced some softness, Aristot and Nutibran prescriptions demonstrated encouraging growth.

Todd: For the full year, we continue to expect Aristotle net sales in the range of $340 to $360 million as we focus on commercial execution and continue to differentiate Aristotle in the long-acting anti-psychotic space.

Todd Nichols: Moving to Vivitrol, net sales in the second quarter were at $111.9 million. Representing 10% year-to-year growth driven by underlying demand, Vivitrol performance continued to be largely driven by the opportunity to alcohol dependence and occasion, which currently counts from more than 75% of Vivitrol volume. For the full year, we continued to expect Vivitrol net sales in the range of $410 to $430 million.

Todd: Moving to Vivitrol, net sales in the second quarter were at $111.9 million, representing 10% year-over-year growth driven by underlying demand.

Unknown Attendee: Vivitrol performance continued to be largely driven by the opportunity alcohol dependence indication, which currently accounts for more than 75% of Vivitrol volume. For the full year, we continue to expect Vivitrol net sales in the range of $410 to $430 million. With a solid Q2 now behind us, looking ahead, we expect to see typical summer demand patterns across our proprietary commercial product portfolio. Against that backdrop, our team will maintain its sharp focus on strong execution, highlighting the differentiating features of our medicines and driving uptake of our products. We look forward to sharing our progress with you. With that, I will pass the call to Richard.

Todd: Vivitrol performance continued to be largely driven by the opportunity alcohol dependence indication, which currently accounts for more than 75% of Vivitrol volume. For the full year, we continue to expect Vivitrol net sales in the range of $410 to $430 million.

Todd Nichols: With a solid Q2 now behind us, looking ahead we expect to see typical summer demand patterns across our proprietary commercial product portfolio. Against that backdrop, our team will maintain its sharp focus on strong execution, highlighting the differentiating features of our medicines and driving uptake of our products.

Todd: With a solid Q2 now behind us, looking ahead, we expect to see typical summer demand patterns across our proprietary commercial product portfolio.

Todd: Against that backdrop, our team will maintain its sharp focus on strong execution, highlighting the differentiating features of our medicines and driving uptake of our products. We look forward to sharing our progress with you. With that, I will pass the call to Richard.

Todd Nichols: We look forward to sharing our progress with you.

Richard Popps: With that, I will pass the call to Richard. That's great. Thank you, Todd.

Richard F. Pops: That's great. Thank you, Todd. Good morning, everyone. We are now midway through the year and making excellent progress on the objectives we set for 2024. Those objectives are driving commercial and financial performance, advancing ALK2680 in our neuroscience development pipeline, completing the sale of our Athlone Manufacturing Facility, and using our Strengthened Balance Sheet to return capital to shareholders as opportunities present themselves.

Richard Popps: Good morning, everyone. So we're now midway through the year in making excellent progress across the objectives we set for 2024. Those objectives are driving commercial and financial performance, advancing Alk-2680 in our neuroscience development pipeline, completing the sale of our ass loan manufacturing facility, and using our strength and balance sheet to return capital to shareholders as opportunities present themselves. Alkermes is now a biopharmaceutical growth company with multiple proprietary commercial products, an efficient operating structure, and a development pipeline with significant potential value. This is the result of a multi-year evolution from a legacy business as a partner to larger pharmaceutical companies to an integrated, pure play neuroscience company with a financial profile driven by the performance of a proprietary commercial portfolio.

Richard: That's great. Thank you, Todd. Good morning, everyone. So we're now midway through the year and making excellent progress across the objectives we set for 2024.

Richard: Those objectives are driving commercial and financial performance, advancing ALK2680 in our neuroscience development pipeline, completing the sale of our Athlone manufacturing facility, and using our strength and balance sheet to return capital to shareholders as opportunities present themselves.

Richard F. Pops: Alkermes is now a biopharmaceutical company growing, with multiple proprietary commercial products, an efficient operating structure, and a development pipeline with significant potential value. This is the result of a multi-year evolution from a legacy business as a partner to larger pharmaceutical companies to an integrated pure play neuroscience company, with a financial profile driven by the performance of a proprietary commercial portfolio. Our proven ability to bring new neuroscience medicines with significant medical and economic value to market is the foundation for new growth opportunities. This is an important transition, and we're well positioned to execute our plan to become a leader among neuroscience companies. Ops 2680 is becoming an important element of our growth strategy.

Richard: Alkermes is now a biopharmaceutical growth company with multiple proprietary commercial products, an efficient operating structure, and a development pipeline with significant potential value.

Richard: This is the result of a multi-year evolution from a legacy business as a partner to larger pharmaceutical companies.

Richard: to an integrated pure play neuroscience company.

Richard: with a financial profile driven by the performance of a proprietary commercial portfolio.

Richard F. Pops: Our proven ability to bring new neuroscience medicines with significant medical and economic value to market is the foundation for new growth opportunities. This is an important transition, and we're well positioned to execute our plan to become a leader among neuroscience companies. Alk-2680 is becoming an important element of our growth strategy. Alk-2680 is our novel, investigational, once daily oral erection to receptor agonist for narcolepsy, currently in Phase 2 development. During the quarter, we provided key data updates and met significant operational milestones in our expanding clinical program. As we enter Q3, Alk-2680 is the only erection agonist proceeding into phase 2 in both narcolepsy type 1 and type 2, supported by positive, early clinical data in both indications.

Richard: Our proven ability to bring new neuroscience medicines with significant medical and economic value to market is the foundation for new growth opportunities.

Richard: This is an important transition, and we're well positioned to execute our plan to become a leader among neuroscience companies.

Richard: Alex2680 is becoming an important element of our growth strategy.

Richard F. Pops: Alk2680 is our novel, investigational, once-daily oral erection to receptor agonist for narcolepsy, currently in Phase 2 development. During the quarter, we provided key data updates and met significant operational milestones in our expanding clinical program. As we enter Q3, ALK2680 is the only orexin agonist proceeding into phase 2 in both narcolepsy type 1 and type 2, supported by positive early clinical data in both indications. So let's start with our work in narcolepsy type 1, or NT1.

Speaker Change: Alk2680 is our novel, investigational, once-daily oral erection to receptor agonist for narcolepsy.

Speaker Change: Currently in Phase 2 development.

Speaker Change: During the quarter, we provided key data updates and met significant operational milestones in our expanding clinical program.

Speaker Change: As we enter Q3, ALK2680 is the only erection agonist proceeding into phase 2 in both narcolepsy type 1 and type 2, supported by positive early clinical data in both indications.

Richard Popps: So let's start with our work in narcolepsy type 1 or NT1. During the quarter, we initiated our phase 2 study, Vibrance 1, which is a randomized, placebo-controlled, multinational study evaluating the safety, tolerability, and efficacy of three different doses of Alk-2680. We are initiating sites and beginning to enroll patients in the study. The Vibrance 1 Phase 2 study was informed by data from our Phase 1D proof-of-concept study. Last month, at the 2024 Sleep Meeting in Houston, we presented data from the full NT1 cohort from the Phase 1B study. This medical congress gave us the opportunity to share their data set with thought leaders and physicians within the broader clinical community, along with patient advocacy organizations that play a key role in this therapeutic space.

Richard F. Pops: During the quarter, we initiated our phase 2 study, Vibrance 1, which is a randomized, placebo-controlled, multinational study evaluating the safety, tolerability, and efficacy of three different doses of ALK2680. We are initiating sites and beginning to enroll patients in the study. The Vibrance 1 Phase 2 study was informed by data from our Phase 1b Proof of Concept study. Last month, at the 2024 SLEAP meeting in Houston, we presented data from the full NT1 cohort from the Phase 1 BC. This medical congress gave us the opportunity to share the data set with thought leaders and physicians within the broader clinical community, along with patient advocacy organizations that play a key role in this therapeutic space.

Speaker Change: So let's start with our work in narcolepsy type 1 or NT1.

Speaker Change: During the quarter, we initiated our Phase II study, Vibrance I.

Speaker Change: which is a randomized, placebo-controlled, multinational study evaluating the safety, tolerability, and efficacy of three different doses of ALK2680. We are initiating sites and beginning to enroll patients in the study.

Speaker Change: The Vibrance 1 Phase 2 study was informed by data from our Phase 1b Proof of Concept study.

Speaker Change: Last month, at the 2024 SLEAP meeting in Houston, we presented data from the full NT1 cohort from the Phase 1b study.

Speaker Change: This medical congress gave us the opportunity to share the data set with thought leaders and physicians within the broader clinical community, along with patient advocacy organizations that play a key role in this therapeutic space.

Richard Popps: Feedback from these stakeholders bolstered our belief that the erection to receptor agonist mechanism represents an opportunity to transform the treatment of narcolepsy. In early April, we also announced positive top-line data from the 1B cohorts with narcolepsy type 2 or NT2 and idiopathic hypersomnia. We plan to present additional data from the phase 1B study at the upcoming Sleep Year of Meeting in September. The data from the 1B and NT2 support advancement into a plan Phase 2 study, which will be called Vibrance 2. Vibrance 2 will leverage much of the work we've been doing in launching Vibrance 1, so we're moving quickly. I expect to initiate that study and open it for patient enrollment toward the end of the summer.

Richard F. Pops: Feedback from these stakeholders bolstered our belief that the erection tube receptor agonist mechanism represents an opportunity to transform the treatment of narcolepsy. In early April, we also announced positive top-line data from the 1B cohorts with narcolepsy type 2, or NT2, and idiopathic hypersomnia. We plan to present additional data from the Phase 1b study at the upcoming Sleep Europe meeting in September. The data from the 1B study in NT2 support advancement into a planned Phase 2 study, which will be called Vibrance 2.

Speaker Change: Feedback from these stakeholders bolstered our belief that the erection tube receptor agonist mechanism represents an opportunity to transform the treatment of narcolepsy.

Speaker Change: In early April , we also announced positive top line data from the 1B cohorts with narcolepsy type 2, or NT2, and idiopathic hypersomnia.

Speaker Change: We plan to present additional data from the Phase 1b study at the upcoming Sleep Europe meeting in September .

Speaker Change: The data from the 1B in NT2 support advancement into a planned Phase 2 study, which will be called Vibrance 2. Vibrance 2 will leverage much of the work we've been doing in launching Vibrance 1, so we're moving quickly and expect to initiate that study and open it for patient enrollment toward the end of the summer.

Richard F. Pops: Vibrance 2 will leverage much of the work we've been doing in launching Vibrance 1. So we're moving quickly and expect to initiate that study and open it for patient enrollment toward the end of the summer. NT2 represents a significant potential opportunity for ALK2680, and advancing it in the clinic in this patient population is becoming an important differentiating feature for ALK2680. A key element across the Phase II program is the range of doses that will be evaluated. 4, 6, and 8 mg in NT1 and 10, 14, and 18 mg in NT2.

Richard Popps: NT2 represents a significant potential opportunity for OX2680, and advancing it in the clinic in this patient population is becoming an important differentiating feature for OX2680. A key element across the Phase 2 program is the range of doses that will be evaluated for 6 and 8 milligrams and NT1 and 10, 14, and 18 milligrams in NT2. Exploring this continuous dose range will allow us to comprehensively establish the dose response curve and the safety and tolerability profile of F-2680 in narcolepsy type 1 and type 2. This range of doses also presents the potential to accommodate a spectrum of patient profiles and treatment objectives.

Speaker Change: NT2 represents a significant potential opportunity for ALK2680, and advancing it in the clinic in this patient population is becoming an important differentiating feature for ALK2680.

Speaker Change: A key element across the Phase II program is the range of doses that will be evaluated.

Speaker Change: 4, 6, and 8 mg in NT1 and 10, 14, and 18 mg in NT2. Exploring this continuous dose range will allow us to comprehensively establish the dose response curve and the safety and tolerability profile of F2680 in narcolepsy type 1 and type 2.

Richard F. Pops: Exploring this continuous dose range will allow us to comprehensively establish the dose response curve and the safety and tolerability profile of F2680 in narcolepsy type 1 and type 2. This range of doses also presents the potential to accommodate a spectrum of patient profiles and treatment objectives. Beyond narcolepsy, data from across our Phase I study of ALK2680 support our hypothesis that orexin-2 receptor agonists, such as ALK2680, may have utility in treating a range of neurological disorders where excessive daytime sleepiness is a serious clinical consideration.

Speaker Change: This range of doses also presents the potential to accommodate a spectrum of patient profiles and treatment objectives.

Richard Popps: Beyond narcolepsy, data from across our Phase 1 study of F-2680 support our hypothesis that erected to receptor agon, such as ox-2680, may have utility and treating a range of neurological disorders where excessive daytime sleepiness is a serious clinical consideration. The positive results in idiopathic hypersomnia or I-H in the Phase 1B study begin to build supporting evidence for this hypothesis. I-H by itself represents a meaningful potential opportunity, and we are evaluating our strategic development plan in that underserved disease area. More broadly, the I-H data further suggests that if 2060 can drive meaningful changes in weightfulness and patients with relatively normal erecting levels and provide additional support for the evaluation of broader clinical uses for these agents.

Speaker Change: Beyond narcolepsy, data from across our Phase I study of ALK2680 support our hypothesis that orexin-2 receptor agonists, such as ALK2680, may have utility in treating a range of neurological disorders where excessive daytime sleepiness is a serious clinical consideration.

Richard F. Pops: The positive results in idiopathic hypersomnia, or IH, in the Phase 1b study begin to build supporting evidence for this hypothesis. IH by itself represents a meaningful potential opportunity, and we are evaluating our strategic development plan in that underserved disease area. But more broadly, the IH data further suggest that ALK2680 can drive meaningful changes in wakefulness in patients with relatively normal orexin levels and provide additional support for the evaluation of broader clinical uses for these agents. The work to explore these broader opportunities and advance our portfolio of preclinical erectin-2 receptor agonists is well underway.

Speaker Change: The positive results in idiopathic hypersomnia, or IH, in the Phase 1b study begin to build supporting evidence for this hypothesis.

Speaker Change: IH by itself represents a meaningful potential opportunity and we are evaluating our strategic development plan in that underserved disease area.

Speaker Change: But more broadly, the IH data further suggests that ALK2680 can drive meaningful changes in wakefulness in patients with relatively normal orexin levels.

Speaker Change: and provide additional support for the evaluation of broader clinical uses for these agents.

Richard Popps: The work to explore these broader opportunities and advance our portfolio of free clinical erecting to receptor agonist is well underway. We have been active with our pre-clinical experimentation and new I-P filings are in process.

Speaker Change: The work to explore these broader opportunities and advance our portfolio of preclinical EREXIN-2 receptor agonists is well underway. We have been active with our preclinical experimentation, and new IP filings are in process.

Richard F. Pops: We have been active with our preclinical experimentation, and new IP filings are in process. We plan to share more about our development strategy later this year. I'm going to end with a brief update on our capital allocation strategy. The business is in a strong position to generate considerable excess cash flow while investing in the growth of our commercial portfolio and advancing our pipeline, as evident in our results year-to-date. Based on the progress we're making in the business, measured against the current valuation, we see a substantial opportunity to capture value for shareholders.

Richard F. Pops: We plan to share more about our development strategy later this year. And with a brief update on our capital allocation strategy, the business is in a strong position to generate a considerable excess cash flow while investing in the growth of our commercial portfolio and advancing our pipeline, as evident in our results year to date. Based on the progress we're making in the business measure against the current valuation, we see a substantial opportunity to capture value for shareholders. In Q2, we activated our share repurchase program. We will continue to be active in the market, informed by the ongoing needs of the business and evolving market conditions.

Speaker Change: We plan to share more about our development strategy later this year.

Speaker Change: I'm going to end with a brief update on our capital allocation strategy.

Speaker Change: The business is in a strong position to generate a considerable excess cash flow while investing in the growth of our commercial portfolio and advancing our pipeline, as evident in our results year to date.

Speaker Change: Based on the progress we're making in the business, measured against the current valuation, we see a substantial opportunity to capture value for shareholders.

Richard F. Pops: In Q2, we activated our share repurchase program. We will continue to be active in the market, informed by the ongoing needs of the business and the evolving market conditions. Across the business, we generated a strong financial and operational performance in the first half of the year. Looking ahead, we have clear goals and priorities to advance the business and will maintain a sharp focus on execution and efficiency to deliver on those objectives. So we look forward to sharing our progress with you, and I'll turn it back to Sandy to run the Q&A. Great, thanks.

Speaker Change: In Q2, we activated our share repurchase program. We will continue to be active in the market, informed by the ongoing needs of the business and the evolving market conditions.

Richard Popps: Across the business, we generate a strong financial and operational performance in the first half of the year.

Speaker Change: Across the business, we generated a strong financial and operational performance in the first half of the year.

Richard Popps: Looking ahead, we have clear goals and priorities to advance the business and will maintain a sharp focus on execution and efficiency to deliver on those objectives.

Speaker Change: Looking ahead, we have clear goals and priorities to advance the business and will maintain a sharp focus on execution and efficiency to deliver on those objectives.

Sandra Coombs: So we'll look forward to sharing our progress with you, and I'll turn it back to Sandy to run the Q&A. Great, thanks.

Speaker Change: So we look forward to sharing our progress with you, and I'll turn it back to Sandy to run the Q&A. Great, thanks.

Sandra Coombs: Rob will now open the call for Q&A, please. Thank you, Sandy.

Unknown Executive: Job will now open the call for Q&A for you.

Operator: But thank you, Sandy. If you would like to ask a question at this time, you may press star 1 from your telephone keypad, and the confirmation tone will indicate your line is in the question queue. You may press star 2 if you'd like to remove your question from the queue. For business reunion speaker equipment, it may be necessary to pick up your handset before pressing the star keys.

Speaker Change: Rob will now open the call for Q&A please.

Rob: If you would like to ask a question at this time, you may press star 1 on your telephone keypad, and a confirmation tone will indicate your line is in the question queue. You may press star 2 if you would like to remove your question from the queue. For participants using speaker equipment, it may be necessary to pick up your handset before pressing the star keys. One moment, please, while we poll for questions.

Rob: Thank you, Sandy.

Rob: If you would like to ask a question at this time, you may press star 1 from your telephone keypad and a confirmation tone will indicate your line is in the question queue.

Rob: You may press star 2 if you would like to remove your question from the queue.

Rob: For participants who are using speaker equipment, it may be necessary to pick up your handset before pressing the star keys. For one moment please while we poll for questions.

Operator: One more, please. Will we pull for questions? Hold on one second. Okay, run. Go ahead.

unknown: Hold on one second, www.spacevidcast.com Okay Rob, go ahead. Thank you.

Speaker Change: ©2020 University of Georgia College of Agricultural and Environmental Sciences UGA Extension Office of Communications and Creative Services

Rob: Thank you. The first question was from the line of Umer Raffat with Evercore ISI. Please proceed with your question.

Umer Raffat: Thank you. The first question was from the line of Umar Ruffat with Evo CoriSI. Please see you through questions. Thanks for taking my question.

Speaker Change: Okay, Rob. Go ahead. Thank you. The first question was from the line of Umer Raffat with Evercore ISI. Please proceed with your question.

Umer Raffat: Thanks for taking my question. Maybe a couple today, if I may, not on Orexin specifically, actually.

Umer Raffat: Maybe a couple today, if I may, not on a recon specifically, actually. I was curious as we think about sort of the value of the base business and the trajectory of your underlying EPS of the business, which is now profitable. How are you thinking about the M&A priorities and the types of things and assets you're considering? Are they more on the pipeline side, or are they more on something that could add to the EPS or profitability in short order, if not right away. Because I think they'll be very relevant for us to think about in terms of the direction EPS is added.

Umer Raffat: Thanks for taking my question. Maybe a couple today if I may, not on Orexin specifically actually. I was curious as we think about sort of the value of the base business and the trajectory of your underlying EPS of the business which is now profitable.

Richard F. Pops: I was curious, as we think about sort of the value of the base business and the trajectory of your underlying EPS of the business, which is now profitable, Richard, how are you thinking about the M&A priorities and the types of things and assets you're considering? Are they more on the pipeline side, or are they more on something that could add to EPS or profitability in short order if not right away? Because I think that will be very relevant for us to think about in terms of the direction EPS is headed.

Richard: Richard, how are you thinking about the M&A priorities and the types of things and assets you're...

Richard: considering, are they more on the pipeline side or are they more on something that could add to the EPS or profitability in short order, if not right away, because I think they'll be very relevant for us to think about in terms of the direction EPS is headed.

Umer Raffat: And then secondly, by my math, it looks like there may be about 4 million dollars' worth of inventory built into or inventory recovery on liability.

Speaker Change: And then secondly, by my math, it looks like there may be about $4 million worth of inventory build into, or inventory recovery on Libelli this quarter. Could you please clarify that as well?

In this corner, could you please clarify that as well? Thanks.

Richard F. Pops: Sure, I'll take the first one and then I'll let Blair and Todd weigh in on the inventory side. Yeah, I think that our M&I priorities are consistent quarter to quarter, and we're actually really interested in both of those domains, EPS augmentation through commercial products that would drop profits to the bottom line, as well as expanding the pipeline. So if we fast forward a couple of years to look at this company, what should it look like? It should have a robust growing top line, strong profitability, and an expanded pipeline. Blair?

Speaker Change: Sure, I'll take the first one and then I'll let Blair and Todd weigh in on the inventory side. Yeah, I think that our M&I priorities are consistent quarter to quarter and we're actually really interested in both of those domains.

Speaker Change: EPS Augmentation through commercial products that would drop

Speaker Change: Profits to the bottom line, as well as expanding the pipeline. So if we fast forward a couple years to look at this company, what should it look like? It should have a robust, growing top line, strong profitability, and an expanded pipeline. So we need to build across each of those axes.

Blair C. Jackson: Blair? Yeah, and then I think with regard to inventory, your math is great. So we did see, remember, a shortfall in inventory in Q1. We've recovered in Levalvian Q2, and the same goes for all of our other programs.

Blair C. Jackson: Yeah, and then I think with regard to inventory.

Blair: Blair yeah and then I think with regards to inventory your math is great so we did see it remember a shortness of inventory in the Q1 we've recovered in the Balbian Q2 and the same goes for all of our other programs as well

Speaker Change: Thank you very much.

Charles Cliff Duncan: Our next question is from the line of Charles Duncan with Candor Fitzgerald. Please proceed with your question.

Speaker Change: Our next question is from the line of Charles Duncan with Candor Fitzgerald. Please proceed with your questions.

Richard F. Pops: Good morning. Thanks for taking the question and congrats on a good quarter. I had two questions, one on the pipeline and one on commercial. The first is on the pipeline. With regard to Vibrance 1, you said that you've begun enrolling patients. And I guess I'm wondering, with that cadence, can you give us a sense of timing for data with Vibrance 1? And then, with regard to the commercial question on the Ball V, give us a little bit of color on in-market dynamics, and what would you expect with a possible coming approval for CAR XT and how that could be impacted? Thanks.

Charles Cliff Duncan: Good morning. Thanks for taking the question and congrats on a good quarter. I had two questions, one on pipeline, one on commercial.

Charles Cliff Duncan: The first is on the pipeline.

Charles Cliff Duncan: With regard to Vibrance 1, you said that you've begun enrolling patients and I guess I'm wondering

Charles Cliff Duncan: With that cadence, can you give us a sense of timing to data?

Charles Cliff Duncan: With regard to the commercial question, on the Balvi, give us a little bit of color on in-market kind of dynamics and what would you expect with

Charles Cliff Duncan: A possible coming approval for CAR XT and how that could be impacted. Thanks.

Richard F. Pops: Good morning, Charles. It's Rich.

Charles Cliff Duncan: Good morning, Charles. It's Rich. I'll start.

Richard F. Pops: I'll start. Yeah, Vibrant's one, I think, I think the primary operational, you know, managerial focus right now is site activation. So we will be activating sites all through the summer and into the fall. It's a fairly large national, multinational study. So it's too early now; we're just the beginning of the enrollment curve.

Speaker Change: Yeah, Vibrant's one, I think, I think the primary operational, you know, managerial focus right now is site activation.

Speaker Change: So we will be activating sites all through the summer into the fall, it's a fairly large multinational study, so it's too early now, we're just at the beginning of the enrollment curve, so it's too early to extrapolate, but we will for sure give you guys better visibility into that as we get it ourselves, as sites get activated.

Richard F. Pops: So it's too early to extrapolate, but we will for sure give you guys better visibility into that as we get it ourselves as sites get activated. And I'll let Todd and Blair comment on the in-market dynamics of Libalvi right now. Yeah, absolutely.

Speaker Change: And I'll let Todd and Blair comment on the in-market dynamics in Lebalvi right now. Yeah, absolutely. So, in general, the way we're thinking about Lebalvi and what we saw in Q2 is we saw strong underlying demand overall. That led to about 12%.

Unknown Attendee: So in general, the way we're thinking about Libalvi, and what we saw in Q2, was that we saw strong underlying demand overall that led to about 12% increase in TRX growth, which is really encouraging and what we expected, and that was really driven by new patient starts. New patient starts, which is defined as MBRX, grew about 17% quarter over quarter, so really solid, solid growth in new patient starts, which was driven by breadth of prescribing.

Todd: increase in TRX growth, which is really encouraging and what we expected. Then that was really driven by new patient starts.

Speaker Change: New Patients Starts, which is defined as NBRX, has grew about 17% quarter over quarter. So really solid, solid growth on New Patients Starts.

Unknown Attendee: So we continue to see breadth of prescribing expand. Year over year, breadth of prescribing has expanded by about 23%, and our expectation is that will continue. When we talk to the HCPs in our target audience, greater than 90% of them tell us that they plan to continue to expand prescribing, so we think it's a really encouraging trend. In terms of just market dynamics overall, looking at the category, you know, we obviously watch what's happening from a competitive standpoint.

Speaker Change: which was driven by breadth of prescribing. So we continue to see breadth of prescribing expand. Year over year, breadth of prescribing expanded about 23%, and our expectation is that will continue. That's supported by a lot of our market research.

Speaker Change: When we talk to the HCPs in our target audience, greater than 90% of them tell us that they plan to continue to expand prescribing, so we think it's a really encouraging trend.

Speaker Change: In terms of just market dynamics overall, looking at the category, you know, we obviously watch what's happening.

Unknown Attendee: We are aware and watching that CAR-XT is up for its PDUFA date later this year. That's a product that will likely be approved for just schizophrenia. You know, that's a situation where the product is now going to move from the promise really to the reality of the situation, being in the market. What we know about schizophrenia is that we have deep experience there. It's a complex market. We do expect that they will compete aggressively, and we are ready for that. That really doesn't change how we think about the profile for Labavi and really what our focus is on driving growth within schizophrenia and also within bipolar disorder.

Speaker Change: From a competitive standpoint, we are aware and watching that CAR XT is up for the PDUFA date later this year. That's a product that will likely be approved in just schizophrenia.

Speaker Change: You know, that's a situation where the product is now going to move from the promise really to the reality of the situation, being in the market.

Speaker Change: What we know about schizophrenia is we have deep experience there. It's a complex market. We do expect

Speaker Change: that they will compete aggressively and we are ready for that. That really doesn't change how we think about the profile for LaBalvie and really what our focus is on driving growth with within schizophrenia and also within bipolar.

Unknown Attendee: Excellent. Helpful information. Thanks.

Speaker Change: Excellent. Helpful information. Thanks.

Chris Shibutani: Our next question comes from the line of Chris Shibutani with Goldman Sachs. Please proceed with your question.

Speaker Change: Our next question comes from the line of Chris Shibutani with Goldman Sachs. Please proceed with your questions.

Richard F. Pops: Good morning. Thanks very much. With the enrollment timelines, we appreciated that in terms of thinking about how you move by Rints 1 and 2. I believe you would be the only program advancing into NT Type 2. How are you thinking about the potential to move into IH? I know you've made some comments before about the broader commercial considerations like IRA, but help us with some hints, possibly on what you think would be your strategy for thinking about a different asset? More of a backup to NT1-2 or a different market target? Thank you. Yeah, good morning, Chris.

Chris Shibutani: Good morning. Thanks very much. With the enrollment timelines, we appreciated that in terms of thinking about how you move by rents one and two. I believe...

Speaker Change: You would be the only program advancing into NT Type 2.

Speaker Change: Would we expect, therefore, that there's potential for a quicker pace of enrollment there, given that opportunity? And then, secondly, you mentioned about some additional assets.

Speaker Change: How are you thinking about the potential to move into IH? I know you've made some comments before about the broader commercial considerations like IRA, but help us with some hints possibly on what you think would be your strategy for thinking about a different asset. More of a backup to NT1-2 or a different market target? Thank you.

Richard F. Pops: And they are thoughtful questions because I think what you're going to see in our company is an expansion of the prominence of this whole wakefulness circuitry in the brain and its relevance to to underlying human disease. The core of the bullseye is narcolepsy. Narcolepsy is comprised of both NT1 and NT2, and what we're so pleased with with the Vibrance 1 and Vibrance 2 studies is that we're addressing, Narcolepsy writ large with with a range of doses that are that are contiguous and that's that's Important one of the things we took away from the sleep meeting in Houston where we presented these data At least I took away was a tremendous desire from the IH community for new medicine, It's a very underserved population.

Richard F. Pops: Yeah, good morning, Chris. And thank you for the thoughtful questions.

Speaker Change: Yeah, good morning, Chris. And thank you for the thoughtful questions. And they are thoughtful questions because I think what you're going to see in our company is an expansion of the prominence of this whole wakefulness circuitry in the brain and its relevance to underlying human disease.

Speaker Change: The core of the bullseye is narcolepsy.

Speaker Change: Narcolepsy is comprised of both NT1 and NT2 and what we're so pleased with with the Vibrance 1 and Vibrance 2 studies is that we're addressing

Speaker Change: Narcolepsy writ large with with a range of doses that are that are contiguous and that's that's important. One of the things we took away from the sleep meeting in Houston where we presented these data, at least I took away, was a tremendous desire from the IH community for new medicines.

Richard F. Pops: So we are actively really reconsidering what we're gonna do with 2680 and follow-on molecules that we're moving into the clinic in IH. We are gonna be playing in IH. I can say that with some degree of certainty, and it's, stay tuned for that. The program.

Speaker Change: It's a very underserved population. So we are actively really reconsidering what we're going to do with 2680 and follow-on molecules that we're moving into the clinic in IH. We are going to be playing in IH. I can say that with some degree of certainty.

Speaker Change: And it's it's stay tuned for for that. The program.

Richard F. Pops: RIT LARGE is going to expand, and you'll see more about that in the fall when we open up some of the kimono about what we're doing with our subsequent molecules and some of the disease areas we're moving into. There's been an enormous amount of preclinical work that's been going on over the last year and associated IP filings, so we're about ready to start talking about that publicly. So stay tuned, but I think you're going to see the program.

Speaker Change: writ large is going to is going to expand and you'll see more about that in the in the fall.

Speaker Change: When we open up some of the...

Speaker Change: The kimono about what we're doing.

Speaker Change: with our subsequent molecules and some of the disease areas that we're moving into. There's been an enormous amount of preclinical work that's been going on over the last year and associated IP filings. So we're about ready to start talking about that publicly.

Richard F. Pops: Based on the data we've generated, it's been so encouraging in the early studies to see the program. Our next questions are from the line of Paul Matteis with Stiefel. Hey, this is James on behalf of Paul. Thanks for taking our question.

Speaker Change: So, stay tuned, but I think you're going to see the program, based on the data we've generated, it's been so encouraging in the early studies, to see the program expand.

Paul Andrew Matteis: Our next questions are from the line of Paul Matteis with CFL. Please send your question. Hey, this is James on behalf of Paul. Thanks.

Speaker Change: Our next questions are from the line of Paul Matteis with Stiefel. Please receive your questions.

Speaker Change: Hey, this is James. I'm for Paul. Thanks for taking our question.

James: Maybe just one here. So, you know, we've seen some others talk about, you know, others with high kind of Medicaid exposure talk about Medicaid disenrollment kind of being higher and impacting numbers and

James: Vivetrol had a great quarter in 2Q, but just wondering if you can speak to any dynamics there, if it's impacting you, or how we should think about the rest of the year there. Thanks so much.

Unknown Attendee: Yeah, absolutely, James, I'll take that one. You know, that's something that we watch very closely, Medicaid enrollment. We've watched that for years. We look at that, not only for Vivitrol but across our entire portfolio, and what we see is that the mix of business is not really experiencing any type of dramatic changes. We're going to continue to monitor, but at this point right now, we haven't seen any reduction in Medicaid claims across our product portfolio.

Speaker Change: Yeah, absolutely, James. I'll take that one. You know, that's something that we watch very closely, Medicaid enrollment. We've watched that for years.

Speaker Change: We look at that not only for Vivitrol, but across our entire portfolio, and what we see is that the mix of business is not really experiencing any type of dramatic changes.

Speaker Change: We're going to continue to monitor, but at this point right now we haven't seen any reduction in Medicaid claims across our product portfolio.

Joseph Stolm: Our next questions are from the line of Joseph Stolm with TD Count. Please proceed with your questions.

Speaker Change: Great, thanks.

Speaker Change: Our next questions are from the line of Joseph Stolm with TD Count. Please receive your questions.

Joseph Stolm: Hi there, good morning, and thank you for taking my questions. Maybe a couple tips on dosing for the EREXIM programs. I was with some of the other competitive agents, and we saw that some of the AEs maybe attenuate with time or patients tolerate the therapies, especially in relation to maybe insomnia or other things. Have you ever considered maybe doing a dose titration, maybe to get to the target doses? Do you think that would help with AEs? Maybe, why or why not?

Joseph Stolm: Hi there. Good morning, and thank you for taking my questions. Maybe a couple just on dosing for the EREXIM programs. With some of the other competitive agents, we've seen that some of the AEs maybe attenuate with time or patients tolerize to the therapies, especially in relation to maybe insomnia or other things. Have you ever considered maybe doing a dose titration, maybe to get to the target doses? Do you think that would help with AEs? Maybe why or why not? And then when you think about the ideal number of doses to take forward to pivotal or commercial, is the goal from these Phase IIs to identify one dose, or would you potentially take forward multiple? And then just one quick question on the commercial side. Can you talk a little bit about the potential impact of those new contracts coming online July 1st?

Richard F. Pops: What about the ideal number of doses to take forward to pivotal or commercial? Is the goal of these Phase IIs to identify one dose, or would you potentially take forward multiple? And then just one quick question on the commercial side. Can you talk a little bit about the potential impact of those new contracts coming online on July 1st? Maybe what you have seen so far for like Volvi, and how should we think about maybe what kind of revenues that could unlock going forward? Thanks.

Joseph Stolm: What have you seen so far for Bolivian? How should we think about what kind of revenues that could unlock going forward? Thanks.

Richard F. Pops: I'll take the first two and then I'll ask Todd to comment on the third. What's interesting about the data we've generated so far with ALCS2680 is that its tolerability profile is really good. And we've disclosed a lot of detail about that. And in NT1, the doses that we're using are quite low and quite well tolerated, and that can be the same for NT2. So, the way we're going to run phase two is in these fixed lanes of doses.

Speaker Change: I'll take the first two and then I'll ask Todd to comment on the third. What's interesting about the data we've generated so far with Alpha 2680 is its tolerability profile is really good.

Speaker Change: We've disclosed a lot of detail about that and in NT1 the doses that we're using are quite low and quite well tolerated and that can be the same also for NT2. So the way we're going to run the phase 2 is in these fixed lanes of doses.

Richard F. Pops: And that's where we'll fully elaborate the tolerability profile over time, over a six-week period in a large number of patients. And then you'll have the information to say, is the titration necessary, or our pre-test hypothesis is that it won't be necessary.

Speaker Change: And that's where we'll fully elaborate the tolerability profile over time, over a six-week period in a large number of patients.

Speaker Change: And then you'll have the information to say is a titration necessary or our pre-test hypothesis is that it won't be necessary.

Richard F. Pops: But the virtue of having a range of contiguous doses is that for any individual patient, then they have the ability to modulate the dose, with their physician, to whatever level of activity or tolerability that is suitable for their particular circumstances. So, we think that's actually one of the major clinical advantages and ultimately the commercial advantages of the product. So, therefore, answering your second question, for sure, we're interested in a range of doses in a commercial presentation rather than a single dose because humans are variable, and people's expectations and desires for pharmacotherapy will vary. So, it's a market that's suited for a range of well-tolerated options. Yeah, and I'll, I'll take the

Speaker Change: But the virtue of having a range of contiguous doses is that for any individual patient, then, they have the ability to modulate the dose, they and their physician, to whatever level of activity or tolerability that is suitable for their particular circumstances. So we think that's actually one of the major.

Speaker Change: Clinical Advantages and ultimately the Commercial Advantages of the product. So therefore, answering your second question...

Speaker Change: For sure, we're interested in a range of doses.

Speaker Change: for a commercial presentation rather than a single dose because humans are variable.

Speaker Change: And people's expectations and desires for the pharmacotherapy will vary, so it's a market that's suited for a range of well-tolerated options.

Unknown Attendee: Yeah, and I'll take the, I'll provide a little bit of color just on how we're thinking about market access. You know, as I said in my prepared remarks, since the beginning of the year, we've added approximately 50 million additional lives, which is something that we're really excited about.

Speaker Change: Yeah, and I'll take the, I'll provide a little bit of color just on how we're thinking about market access.

Speaker Change: You know, as I said in my prepared remarks, since the beginning of the year, we've added approximately 50 million additional lives, which is something that we're really excited about. This has been part of our strategy since the launch of the brand.

Unknown Attendee: This has been part of our strategy since the launch of the brand. So we're very focused right now on just optimizing the access profile, but the core element of this is really net sales, right? So we look at net sales and profitability for each unit.

Speaker Change: So, we're very focused right now on just optimizing the access profile, but the core element of this is really net sales, right? So, we look at net sales and profitability for each unit.

Unknown Attendee: I can't get into a lot of detail on the specifics of the contract for competitive reasons, and we're always having ongoing discussions overall. But it can take several quarters for these types of contracts to actually flow through all the way to plan sponsors all the way down at the local level. So that's something that we're actively managing right now, just the pull-through and the push-through element of this. When we thought about our full-year range, we did anticipate that we could have some movement in some of our contracting strategies.

Speaker Change: I can't get into a lot of detail on the specifics of the contract for competitive reasons and we're always having ongoing discussions overall.

Speaker Change: But it can take several quarters for these types of contracts to actually flow through all the way to plan sponsors all the way down at the local level. So that's something that we're actively managing right now is just the pull-through and the push-through element of this.

Speaker Change: When we thought about our full year range, we did anticipate that we could have some movement in some of our contracting strategies. So if we think about just the guidance range overall, which is volume and gross to net, that really reflects and captures a range of scenarios.

Unknown Attendee: So if we think about just the guidance range overall, which is volume and gross-to-net, that really reflects and captures a range of scenarios. So we've already embedded the thinking that we would have some positive market access changes into that range. And today, obviously, we reiterated what the guidance range would be for Levalvier.

Speaker Change: So, we've already embedded the thinking that we would have some positive market access changes into that range, and today, obviously, we reiterated what the guidance range would be for Livalvi.

David A. Amsellem: Our next questions are from the line of David Amsellem with Piper Sandler. Please proceed with your questions.

Speaker Change: Great, thank you.

Speaker Change: Our next questions are from the line of David Amsellem with Piper Sandler. Pleased to see you for your questions.

David A. Amsellem: Hey, thanks. So, two questions. First, on Libaldi, can you talk about how you're thinking about commercial spend as we move into 25? Is the sales force the right size?

David A. Amsellem: Hey, thanks. So, two questions. First, on Libavi, can you talk about how you're thinking about commercial spend as we move?

Richard: Next question, Richard, is the sales force right size, are you at steady state regarding DTC? Just talk about how you're thinking about that, particularly given the promotion sensitivity and the bipolar landscape. So that's number one. And then secondly, on the orexins, a high level question, Richard, you talked about narcolepsy being in the bullseye and then of course there's IH, but I'm wondering if as you're thinking about additional molecules,

Unknown Attendee: Are you at steady state regarding DTC? Just talk about how you're thinking about that, particularly given the promotion sensitivity in the bipolar landscape. So, that's number one. And then, secondly, on the orexins, a high-level question. Richard, you talked about narcolepsy being in the bullseye, and then, of course, there's IH. But I'm wondering if, as you're thinking about additional molecules in the category and that you have in your portfolio, what other therapeutic adjacencies or even adjacent symptoms are you starting to think about? As you broaden the development program in the class, thanks.

David A. Amsellem: in the category and that you have in the portfolio. Are there, what other therapeutic adjacencies or even adjacent symptoms are you starting to think about as you broaden the development program?

Unknown Attendee: Yeah, absolutely. So I'll start first with just the commercial spend questions. You know, for Lebalvi, strategically, we're focused on really three elements. First and foremost, it's driving HCP adoption through depth and breadth. Secondly, it's building and driving patient awareness, which continues to grow through our DTC efforts. And then, thirdly, it's optimizing the access profile.

Speaker Change: in the class. Thanks.

Richard: I'll start first with just the commercial spend questions. You know, for LeBalvy,

Speaker Change: Strategically, we're focused on really three elements and first and foremost it's it's driving HCP adoption through depth and breadth. Secondly, it's building and driving patient awareness which continues to grow through our DTC efforts.

Speaker Change: And then thirdly, it's optimizing the access profile. So that's not going to change going into 25. At this point right now, we think our spend is appropriate with where the brand is, but

Unknown Attendee: So that's not going to change going into 25. At this point right now, we think our spend is appropriate for where the brand is. But as we're moving into 25, the market obviously is dynamic, and we could add additional spend into 25. And it's something that we're looking at. But at this point right now, we think the spend level is appropriate for where the brand is.

Speaker Change: As we move into 25, the market obviously is dynamic, and we could add additional spend in the 25, and it's something that we're looking at, but at this point right now, we think the spend level is appropriate for where the brand is.

Richard F. Pops: And David, on the erections. Without giving too much specificity until later this year, I'd say that there are three categories of adjacencies that immediately come to mind within the context of our CNS focus. One is in psychiatry where the affect or sleepiness or tiredness during the day is an important feature of certain psychiatric conditions. The second is other neurological conditions. And so we've been mapping different compounds and different pharmacology onto those models. And that's what's maturing this year, and you'll hear more about it.

Speaker Change: and David on the on the erections.

David A. Amsellem: without giving too much specificity until later this year.

David A. Amsellem: I'd say that there are three categories of adjacencies that immediately come to mind within the context of our CNS focus. One is in psychiatry, where the affect or the sleepiness or tiredness during the day is an important feature of certain psychiatric conditions.

David A. Amsellem: and second is other neurological conditions.

David A. Amsellem: where excessive sleepiness is a feature of the process. And then certain even neurodevelopmental or neurodegenerative diseases where that's also a major clinical feature. A number of these have relevant preclinical models.

David A. Amsellem: and so we've been we've been mapping different compounds and different pharmacology onto those models and that's that's what's maturing this year and you'll hear more about

Speaker Change: Okay. Helpful. Thanks.

Marc Harold Goodman: Our next question is from the line of Mark Goodman with Lyrinc. Please answer your question.

Speaker Change: Our next question is from the line of Mark Goodman with Lyrinc. Please receive your question.

Richard F. Pops: Rich, I heard you talk about business development. You mentioned commercial products that are already on the market. Obviously, those are pretty expensive.

Marc Harold Goodman: Rich, I heard you talk about business development. You mentioned commercial products that are already on the market. Obviously, those are pretty expensive. So, I was just curious.

Richard F. Pops: So I was just curious, what level of transaction are you talking about here? That's certainly a scenario. Are we talking about multiple billions? Are we talking about the issuance of debt? Or how are you thinking about how big a product to do in the context of that and the short buyback that you're doing? That's what you're thinking.

Marc Harold Goodman: What level of transaction are you talking about here that's certainly a scenario? Are we talking about multiple billions? Are we talking about the issuance of debt? Or how are you thinking about how big a product to do in the context of...

Speaker Change: of that, you know, and the short buyback that you're doing, and just give us a sense of how you're thinking about this.

Richard F. Pops: Yeah, Mark, it's a, I often say it's a target-poor environment, but the targets that Wall Street has bid up significantly are not gonna be targets for us. But with our specialized commercial infrastructure and our focus on addiction and serious mental illness. The circumstances present themselves from time to time where you have assets that may not be major commercial products but would add a lot to our bottom line and would be a logical fit. So I won't talk specifically about scale.

Speaker Change: Yeah, Mark, it's a, it's a, I often say it's a target poor environment, but the targets that Wall Street has bid up significantly are not going to be targets for us.

Speaker Change: But with our specialized commercial infrastructure and our focus in addiction and in serious mental illness.

Speaker Change: Circumstances present themselves from time to time where you have assets that may not be major commercial products but would drop a lot to our bottom line and would be a logical fit in.

Richard F. Pops: I mean, obviously, we have a billion dollars of cash now. We're generating cash. And we really don't see large, large mergers of equal type transactions on the horizon at the moment. And those are rare and rarely successful.

Speaker Change: So, I won't talk specifically about scale, I mean obviously we have a billion dollars of cash now, we're generating cash.

Speaker Change: And we really don't see large, large merger of equal type transactions on the horizon at the moment. And those are rare and rarely successful.

Richard F. Pops: But I think that we have a specialized commercial infrastructure that we think is leverageable, and we'd be interested in doing that. So the sizes, we're not talking about major products; we're talking about opportunistic types of deals that are smaller deals. And then just on Orexin, one question and that is, you know, there are a lot of players, obviously, and you're one of the leaders right now. How do you see this playing out? I mean, you're talking about a strategy of multiple molecules, you know, probably moving into different indications. Is that how you see this? A very fragmented type of situation?

Speaker Change: But, you know, I think that we have a specialized commercial infrastructure that we think is leverageable and we'd be interested in doing that.

Speaker Change: So the size is, we're not talking about major products, you're talking about just opportunistic.

Speaker Change: type of deals that are smaller type of deals. Major being in the eye of the beholder. You know, I think that ones that could have a meaningful impact on EPS going forward, you know, it's sometimes you can do that over a series of deals, or you could do it in one fell swoop, but we look at all those things.

Richard F. Pops: Because there could be five different, six different, I don't know how we end up with Orexins, and there could be multiple products from each company. I mean, how do you imagine that? Well, I think that I think there's an early mover advantage. And, you know, not to make a direct analogy, but look what's happening in the GLP-1 space, where new medicines are being made that are, that are, that are really value added for patients.

Speaker Change: And then just on Erekson, one question and that is, you know, there's a lot of players obviously, and you're one of the leaders right now, how do you see this playing out? I mean, you're talking about a strategy of...

Speaker Change: Multiple molecules, you know, probably moving into different indications. Is that how you see this? A very fragmented type of situation, because there could be five different six different, I don't know how we end, with orexins, and there could be multiple products from each company. I mean, how are you envisioning this?

Speaker Change: Well I think that I think there's a there's an early mover advantage and you know not to make the direct analogy but look what's happening in the GLP-1 space where if you make new medicines that are that are that are really value added for patients

Richard F. Pops: There are huge commercial and clinical opportunities that they could present. However, the chemistry space here, as you know, is limited. There are a number of aspirants, but there are not that many companies that have data that show that they're going to be meaningful competitors in this. So, you know, I think that we can only rely on what we know in terms of the data that's been generated clinically, and we are in a very strong position, so we're going to move as fast as we can and cover as much of the waterfront as we can.

Speaker Change: There are huge commercial and clinical opportunities that present themselves. The chemistry space here, as you know, is limited. There are a number of aspirants, but there's not that many companies that have data that show that there are going to be meaningful competitors in this space.

Speaker Change: So, you know, I think that we can only rely on what we know in terms of the data that's been generated clinically, and we are in a very strong position, so we're going to move as fast as we can and cover as much of the waterfront as we can.

Richard F. Pops: So I don't think at the end of the day there will be lots and lots of players. I think there are too many optimization variables for the molecules, and I think better molecules will do better than inferior ones, and inferior ones won't find a place in the market as attractive as the ones that are better. So we're going to exploit our advantage right now and move as quickly as we can. Blair, I don't know if you have any thoughts on that as well. No, I agree. I think we've already started to see that shake out in some of the early development as we've seen competitors kind of come and go, and we would anticipate that moving forward.

Speaker Change: So, I don't think at the end of the day there's going to be lots and lots of players. I think there's too many optimization variables for the molecules. I think better molecules will do better than inferior ones, and inferior ones won't find a place in the market as attractive as the ones that are better.

Speaker Change: So we're going to exploit our advantage right now and move as quickly as we can. Blair, I don't know if you have any thoughts on that as well. No, I agree. I think we've already started to see that shake out in some of the early development as we've seen competitors kind of come and go and we would anticipate that moving forward.

Blair: Thanks, guys.

Joel Lawrence Beatty: Our next question is from the line of Joel Beatty with Baird. Please proceed with your questions.

Speaker Change: Our next question is from the line of Joel Beatty with Baird. Please proceed with your questions.

Unknown Attendee: Hi, congrats on the quarter and thanks for taking the questions. The first one is on Lebalvi. What trends have you been seeing in the split of scripts between bipolar versus schizophrenia? And then on Vibrance 1, I believe this is a six-week randomized controlled trial followed by a seven-week extension phase. What is the design of the extension phase, particularly as it relates to how dose adjustments will be allowed, and how that could add to a differentiated profile compared to other agents that may not have that same type of dose range available?

Joel Lawrence Beatty: Hi, congrats on the quarter and thanks for taking the questions. The first one is on Livalvi. What trends have you been seeing in the split of scripts between bipolar versus schizophrenia?

Speaker Change: And then on Vibrance 1, I believe this is a 6-week randomized controlled trial followed by a 7-week extension phase.

Speaker Change: What is the design of the extension phase, particularly as it relates to how dose adjustments will be allowed and how that could add to a differentiated profile compared to other agents that may not have that same type of dose ranging available?

Unknown Attendee: Yeah, so I'll start with the LaBalby split, kind of the contribution of the business, which has been relatively stable over the last, you know, two quarters. We saw some similar patterns from Q1.

Speaker Change: Yeah, so I'll start with the Mabalvi split, kind of the contribution of the business.

Speaker Change: which has been relatively stable over the last, you know, two quarters. We saw some similar patterns from Q1. So, overall...

Unknown Attendee: So overall, the split still in terms of overall TRX is approximately 50-50 between schizophrenia and bipolar. The movement that we're starting to see and is becoming more pronounced as we head into this year is just with new patient starts. So when we look at just overall share of MBRXs quarter over quarter, bipolar one disorder prescriptions for new patient starts represent about 57% right now. Obviously, year over year and quarter over quarter, we saw some really robust volume growth for bipolar and schizophrenia, but new patient starts, we're clearly seeing a leading indicator with bipolar right now. So it's very encouraging for us, and it's part of our long-term strategy, obviously, through HCP adoption and also through our And your question about the Vibrance...

Speaker Change: The split still in terms of overall TRX is approximately 50-50 between schizophrenia and bipolar. The movement that we're starting to see and is becoming more pronounced as we headed into this year is just with new patient starts.

Speaker Change: So when we look at just overall share of MBRXs quarter over quarter, bipolar 1 disorder prescriptions for new patient starts represent about 57% right now.

Speaker Change: Obviously, year over year and quarter over quarter, we saw some really robust volume growth for bipolar and schizophrenia, but new patients start.

Speaker Change: We're clearly seeing a leading indicator with bipolar right now, so it's very encouraging for us, and it's part of our long-term strategy, obviously, through HCP adoption, also through our DTC campaign.

Richard F. Pops: And your question about the Vibrant Swan Extension is insightful. I mean, I think it's beginning to reveal what some of the potential advantages of 2680 could be. So indeed, in the seven-week extension phase, when people are done with the fixed lanes of the six-week randomized control aspect of it, they can, patients can opt for dose adjustment between the four, six, and eight milligram doses. It'll be really interesting to see how that settles out, particularly if we do see an attenuation of side effects over time, and the tolerability profile is as favorable as it has the potential We'll take that type of learning from that and the open-label safety study that we'll run independently of that, and all that information will go into designing the phase three protocol.

Speaker Change: And your question about the Vibrance One extension is insightful. I think it's beginning to reveal what some of the potential advantages of 2680 could be. So indeed, in the seven-week...

Speaker Change: extension phase when people are done with the fixed lanes of the six-week randomized control aspect of it.

Speaker Change: They can patients can can opt for dose adjustment between the four six and eight milligram doses It'll be really interesting to see how that settles out particularly if we do see an attenuation of side effects over time

Speaker Change: And the tolerability profile is as favorable as it has the potential to be. It'll be really interesting to see those data. We'll take that type of learning from that and the Open Label Safety Study that we'll run independently of that. All that information will go into designing the Phase 3 protocol.

Akash Tewari: Thank you. Our next question is from the line of Akash Tewari with Jeffries. Please answer your question. Okay, it's money.

Akash Tewari: Our next question is from the line of Akash Tewari with Jeffries. Please take your question. Okay, it's my noise on for Akash.

Speaker Change: Thank you.

Speaker Change: Our next question is from the line of Akash Tewari with Jefferies. Please receive your questions.

Speaker Change: Okay, it's my noise on for Akash.

Manoj: On your orexin program at sleep earlier this year, you had around 60% insomnia at the 8mg high dose in NT1. Where do you think this could be like, these rates could end up with longer term dosing? What's an acceptable rate? And also, did you see any similar rates of insomnia in your NT2IH data? Thanks.

Richard F. Pops: Yeah, I don't have the data immediately at hand, but one of the interesting things from competitive data that was shown at SLEAP in Houston was the attenuation of the side effect of insomnia after the first week. So we think that's probably more of a class-wide phenomenon as patients get accustomed to being on an orexin agonist. Our overall rates of insomnia were very acceptable and dose-dependent. So what we hear from clinicians is what I just mentioned, which is that you see an attenuation of it in real life over time, and we'll more fully elaborate on all that in our Phase 2 study.

Speaker Change: Yeah, I don't have the data immediately at hand, but I think one of the interesting things from the...

Speaker Change: Competitive data that was shown at SLEAP in Houston was the attenuation of the

Speaker Change: of the side effect of insomnia after the first week. So we think that's probably more of a class-wide phenomenon as patients get accustomed to being on orexin agonist.

Speaker Change: Our overall rates of insomnia were very acceptable and dose-dependent. So what we hear from clinicians is what I just mentioned, which is that you see an attenuation of it in real life over time, and we'll more fully elaborate all that in our Phase 2 study.

Speaker Change: Thanks.

Jason Matthew Gerberry: Our next questions are from the line of Jason Gerberry with Bank of America. I'm pleased to see you with your questions.

Speaker Change: Our next questions are from the line of Jason Gerberry with Bank of America. Please receive your questions.

Jason Matthew Gerberry: Hey, good morning. Thanks for taking my questions. I guess the first one is on Aristotle.

Jason Matthew Gerberry: Hi, good morning. Thanks for taking my questions.

Jason Matthew Gerberry: And if there's any expectation that grows to net, if they should be relatively stable next year, you know, when IRA shifts the catastrophic coverage costs on to payer plans, there's sort of an open debate of, is there a risk that rebates materially increase in that category? And then my second question on The Erections, in lieu of Takeda's data and roughly mid-20 minute MWT placebo-adjuste Should the street be focusing on this metric as the key area for differentiation in NT1, or do you think that, you know, it's really more about a broader risk-benefit evaluation and having breadth of indications like NT2 and IH, you know, that's ultimately kind of your area of focus?

Jason Matthew Gerberry: I guess first one is on Aristotle, and if there's any expectation that grows to nets,

Speaker Change: If they should be relatively stable next year, you know, when IRA shifts the catastrophic coverage costs onto payer plans, there's sort of an open debate of, is there a risk that rebates materially increase in that category? And then my second question on...

Speaker Change: The Erections, in lieu of Takeda's data and roughly mid-20 minute MWT placebo-adjusted. Should The Street be focusing on this metric as the key area for differentiation in NT1, or do you think that, you know, it's really more about...

Speaker Change: a broader risk benefit evaluation and having breadth of indications like NT-2 and IH. You know that's ultimately kind of your area of focus. Thanks.

Unknown Attendee: Yeah. Hey, Jason. Todd, I'll start with Aristotle, with a gross net.

Speaker Change: Hey Jason, it's Todd. I'll start with Aristotle, with Gross Donets. This quarter and for the full year, it's relatively stable. Next year, there will be some marginal increases. Obviously, we're very in tune to the implications.

Richard F. Pops: This quarter and for the full year, it's relatively stable. Next year, there'll be some marginal increases. Obviously, we're very in tune with the implications of the IRA.

Unknown Attendee: The way we're really thinking about that is there is really minimal impact in the near and midterm across our portfolio. We don't expect that we're going to have significant inflation penalties because, obviously, we do very responsible pricing actions. None of our medicines are going to be part of the Medicare Part D negotiations, and in terms of the Part D redesign, keep in mind that our company, Alkermes, is classified as a specified small manufacturer. So that enables us to phase in in terms of the overall liability. So it's very manageable for us and mitigates our risk starting in 2025.

Speaker Change: of the IOA. The way we're really thinking about that is there's really minimal impact in the near and midterm across our portfolio. We don't expect that we're going to have significant inflation penalties because obviously we do very responsible pricing actions.

Speaker Change: None of our medicines are going to be part of the Medicare Part D negotiations. And in terms of the Part D...

alchemy: Redesign. Keep in mind that our company, Alkermes, that we're classified as a specified small manufacturer. So that enables us to a phase in in terms of the overall liability. So it's very manageable for us and mitigates our risk starting in 2025.

Richard F. Pops: And this is Rich. I'll take the question about erections. I think the way to think about... The category is. The erections relative to what precedes them and then the erections relative to each other. In the former category, MWTs that have been shown by Takeda and others, they're really good. They're really beneficial for patients, but recognize that MWT, the maintenance of wakefulness value, is really just one dimension of the experience of being on a medicine for the treatment of a serious condition. It's an important metric, it's an approvable metric, and has the virtue of being so quantitative.

alchemy: And this is Rich. I'll take the question about the erections. I think the way to think about

Speaker Change: The category is...

Speaker Change: The erections relative to what precedes them, and then the erections relative to each other.

Speaker Change: in the former category.

Speaker Change: MWTs that have been shown.

Speaker Change: by Takeda and others.

Speaker Change: They're really good. They're really beneficial for patients, but recognize that MWT, the maintenance of wakefulness...

Speaker Change: value.

Speaker Change: is really just one dimension of the experience of being on a medicine for the treatment of a serious condition. It's an important metric, it's an approvable metric.

Richard F. Pops: I think relative to each other, if you stipulate that more than one orexin agonist crosses the finish line, then the question becomes relative to each other. This is exactly where a range of doses, tolerability, and then also a range of indications come into play, so the differential diagnosis doesn't have to be quite so precise between NT1 or NT2 or IH. You basically have agents that can be dosed at multiple doses across a range of those indications. I think that's where the competitive dynamic really gets sharp.

Speaker Change: and has the virtue of being so quantitative, but I think relative to each other, if you stipulate that more than one orexin agonist crosses the finish line, then the question becomes relative to each other.

Speaker Change: And this is exactly where a range of doses, tolerability, and then also a range of indications so the differential diagnosis doesn't have to be quite so precise between NT1 or NT2 or IH. You basically have agents that can be dosed at multiple doses across a range of those indications.

Speaker Change: I think that's where the competitive dynamic really gets sharpened.

Speaker Change: Okay, thank you.

Jessica Macomber Fye: Our next question is from the line of Jessica Fye with J.P. Morgan. Please proceed with your question.

Jessica Macomber Fye: Okay, thank you. Our next question is from the line of Jessica Fye with J.P. Morgan. Please proceed with your questions. Hi, this is...

Speaker Change: Our next question is from the line of Jessica Fye with J.P. Morgan. Please proceed with your questions.

Nassan: Hi, this is Nassan on for Jessica Fye. Just wanted to ask about Aristotle. First, was there an...

Nassan: Inventory benefit for Aristata specifically in a quarter and second can you talk about what gives you confidence of hitting the guidance range for that product this year? Thanks.

Blair C. Jackson: Hi Nissan, this is Blair. With regard to inventory, just like with our other programs in Q1, we had a shortfall in inventory purchases. And so we saw with Aristotle a rebound into Q2. The net effect of that for across the quarters was $2 million.

Nassan: Hi Nissan, this is Blair. With regards to inventory, just like with our other programs in Q1, we had a shortfall of inventory purchases and so we saw with Aristotle a rebound into Q2. The net effect of that for across the quarters was $2 million.

Unknown Attendee: Yeah, in terms of just the outlook for Aristotle today, obviously, we reiterated our guidance range. Obviously, you know, we're watching dynamics in the market right now, and the way we think about it over the last several quarters last year, it's been a, it has been a dynamic market for the LAI category. What we're most interested in is the performance and outlook for Aristotle. In the last two quarters, Q1 and Q2, we've seen some encouraging trends with new-to-brand prescriptions.

Speaker Change: Yeah, in terms of just the outlook for Aristotle today, obviously we reiterated our guidance range. Obviously, you know, we're watching dynamics in the market right now and the way we're thinking about it over the last several quarters, last year, it's been a, it has been a dynamic market for the LAI category.

Speaker Change: What we're most interested in is the performance and outlook for Aristotle. The last two quarters, Q1 and Q2, we've seen some encouraging trends with new-to-brand prescriptions.

Unknown Attendee: So we saw that within the category, and we've seen that within Aristotle. Secondly, we've seen encouraging trends within our non-retail sector for Aristotle as well. So those give us a lot of confidence that we're right on track to achieve our objectives for the year.

Speaker Change: So we saw that within the category, and we've seen that within Aristotle. Secondly, is we've seen encouraging trends within our non-retail sector for Aristotle as well, too. So those give us a lot of confidence that we're right on track to achieve our objectives for the year.

Rob: Okay, Rob, we have time for one more question.

Douglas Dylan Tsao: Hi, we'll be coming from the line of Douglas Tsao with HC Wainwright.

Speaker Change: Great. Rob, we have time for one more question.

Speaker Change: Hi, we'll be coming from the line of Douglas Tsao with HC Wainwright.

Richard F. Pops: Hi, good morning. Thanks for taking the questions and sneaking me in. Maybe, Richard, starting with IH, I think you noted the importance of your finding that you can have an impact on patients with normal orexin levels. I'm just curious, when you think about sort of follow-on molecules or different molecules to develop, would they have, obviously there's sort of a strategic value from an IRA perspective and commercial perspective, but I'm just curious from a pharmacology perspective, just given that difference of normal orexin levels, would there be other tweaks to the molecule that you would make that would make it a better suited molecule for IH versus what some others are doing, who's sort of pursuing a sort of a more of a one-size-fits-all approach?

Douglas Dylan Tsao: Hi, good morning, thanks for taking the questions and sneaking me in. Maybe Richard, starting with...

Douglas Dylan Tsao: [inaudible]

Douglas Dylan Tsao: I think you noted the importance of your finding that you can have an impact on patients with normal erection levels. I'm just curious, when you think about...

Speaker Change: follow-on molecules or different molecules to develop. Would they have, obviously, there's sort of a strategic value from an IRA perspective and commercial perspective, but I'm just curious from a pharmacology perspective, just given that difference...

Speaker Change: of normal orexin levels. Would there be other tweaks to the molecule that you would make that would make it a better suited molecule for IH versus what some others are doing, pursuing a sort of a more of a one-size-fits-all approach?

Richard F. Pops: Hey, Doug. I don't think I'm prepared to answer that question publicly at this moment. I think that there are some lessons that we're learning both clinically and pre-clinically that inform that decision, but I'm not quite ready to go there yet, other than to say what I said earlier, which is that we're pretty convinced that IH is a separate opportunity from narcolepsy. You might be lulled into thinking that NT2 and IH are interchangeable, but I think the more time that we spend with And a single drug could be useful, but more than one drug may be useful as well.

Speaker Change: Hey Dr. I don't think I'm prepared to answer that question publicly at this moment. I think that

Speaker Change: I think that there's some learnings that we're learning both clinically and pre-clinically that inform that decision, but I'm not quite ready to go there yet. Other than to say what I said earlier, which is that...

Speaker Change: I think we're pretty convinced that IH is a separate opportunity from narcolepsy.

Speaker Change: I mean, you might be lulled into thinking that NT2 and IH are interchangeable, but I think the more time that we spend with patients and clinicians, treating patients with the differential diagnosis, there are...

Speaker Change: They are different patients and a single drug could be useful but also more than one drug may be useful as well.

Unknown Attendee: Okay, great. And then just as a follow-up, I mean, obviously, there have been questions around the impact of CAR XT. I'm just curious, from talking to clinicians, do you get a sense that they are [inaudible]

Speaker Change: Okay, great. And then just as a follow-up, I mean, obviously there have been questions around the impact of CAR XT. I'm just curious, from talking to clinicians, do you get a sense that they are...

Speaker Change: targeting sort of the different patients that are, or the two drugs would sort of go after initially different patient sets, meaning Lebalvi in the early going, just because obviously they're very different drugs and Lebalvi has the sort of proven efficacy of Olanthecine. Thank you.

Unknown Attendee: Yeah, I mean, just coming back to just Cartsy in general, it's yet to be determined. First, we've got to see that the product has to get approved, and there has to be a label. And obviously, the company would have to promote it on label right now, and it really doesn't really change how we think about Libavi. That's what's most important to us. Libavi is a broad label, which is a huge benefit for the brand. And, you know, as I said earlier, if you just look at the underlying trends, we see a really healthy, strong mix across schizophrenia and bipolar disorder. So we think the addressable population is very large for Libavi.

Speaker Change: Yeah, I mean, just coming back to just Carxi in general, it's yet to be determined. First, you know, we've got to see that the product has to get approved and there has to be a label. And obviously, the company would have to promote on label right now. And it really, it doesn't really change how we think about Levallois. That's, that's most important to us.

Speaker Change: LVAB has a broad label which is a huge benefit for the brand and as I said earlier, if you just look at the underlying trends.

Speaker Change: We see a really healthy, strong mix across schizophrenia and bipolar. So we think the addressable population is very large for LIBALBI.

Unknown Attendee: And in terms of the growth you're seeing for schizophrenia, is that coming from new prescribers or just greater depth within the existing prescriber base? Thank you. Yeah, absolutely.

Speaker Change: And in terms of the growth you're seeing for schizophrenia, is that coming from new prescribers or just greater depth within the existing prescriber base? Thank you.

Unknown Attendee: Yeah, absolutely. We're seeing depth of prescribing really grow within our existing prescriber base, and it's healthy right now if you look at a quarter of a quarter and year over year. And it's very consistent with the market research. Prescribers tell us once they start on Livalvi, they get a positive experience, which we're hearing a lot of, very positive experiences from HCPs and patients that they will prescribe more, so we see a lot of depth being driven by existing prescribers while driving breath at the same time.

Speaker Change: Yeah, absolutely. We're seeing deaths of prescribing really grow within our existing prescriber base and

Speaker Change: It's healthy right now if you look at it quarter of a quarter and year over year and it's very consistent with the market research prescribers tell us

Speaker Change: Once they start on the Baldi, they get a positive experience, which we're hearing a lot of that. Very positive experiences from HCPs and patients that they will prescribe utilization. So we see a lot of the depth being driven by existing prescribers.

Speaker Change: While driving breath at the same time.

Unknown Attendee: Okay, great. Thank you so much.

Sandra Coombs: Thank you. We have reached the end of the question and answer session, and I will now turn the call over to Sandy Coombs for closing remarks.

Speaker Change: Okay, great. Thank you so much.

Speaker Change: Thank you. We have reached the end of the question and answer session and I'll now turn the call over to Sandy Coombs for closing remarks.

Sandra Coombs: Great. Thank you everyone for joining us on the call today. Please don't hesitate to reach out to us at the company if you have any follow-up questions. Have a great day.

Sandra Coombs: Great. Thanks everyone for joining us on the call today. Please don't hesitate to reach out to us at the company if you have any follow-up questions. Have a great day.

Rob: This concludes today's conference. You may disconnect your lines at this time. Thank you for your participation.

Speaker Change: This concludes today's conference. You may disconnect your lines at this time. Thank you for your participation.