Q3 2024 Intra-Cellular Therapies Inc Earnings Call
Good day and thank you for standing by.
Speaker Change: Welcome to the intro cellular therapies, 3Q, 2024, Ernest Conference Call. At the time, participants are an allicent-only mode. After the speaker's presentation, there will be a question and answer session. To ask a question during the session, you will need to press star 1-1 on your telephone.
Speaker Change: You will then hear an automated message advising that your hand is raised. To withdraw your question, please press star one again. Please be advised, but today's conference is being recorded. I would now like to hand the call over to one Sanchez. Head of Investor Relations, please go ahead.
Speaker Change: Good morning and thank you all for joining us on our 3rd Core 2024 Ernest Call
Speaker Change: Joining me on the call today at Dr. Sharon Mates, Chairman and Chief Executive Officer, Mark Neumann, Chief Commercial Officer, Dr. Suevester Gamm, Chief Medical Officer, Anthony Giff, Narula, Chief Financial Officer.
Speaker Change: I'd like that to complement today's call is available on the investors' advanced section of our corporate website.
Speaker Change: During today's call we will be making certain for looking statements.
Speaker Change: These four looked in statements are based on current information, assumptions and expectations.
Speaker Change: The statements are subject to change and involve a number of risks and uncertainties that may cause actual results to differ materially from those contained in the forward-looking statements.
Speaker Change: This and other risks are described in our periodic filings made with the Securities and Exchange Commission, including our quarterly and annual reports.
Speaker Change: Your caution not to play on your reliance on these forward-looking statements. These statements are made only as of the day of this conference call, and the company disclaims any obligation to update such statements.
Speaker Change: I will now turn the call over to Sharon.
Sharon Mates: Thanks Juan. Good morning and welcome to our third quarter earnings call. We are pleased to share our Q3 results and to describe the exciting progress we have made across the company.
Sharon Mates: Keplita's growth trajectory continues to reflect a compelling product profile and our successful commercial execution, with net sales of $175.2 million in the third quarter, representing a 39% increase over the third quarter of 2023.
Sharon Mates: Based on this continued strong performance, we are raising our 2024 full-year net sales guidance range to $665 million to $685 million.
Sharon Mates: We look forward to building on our positive momentum for the rest of 2024 and beyond.
Sharon Mates: In addition, we continue to advance our broad pipeline, and we are on track to submit our Supplemental NDA for the Adjunctive Treatment of Major Depressive Disorder, or MDD, this quarter.
Sharon Mates: Looking at the big picture, our objective has always been to help the greatest number of patients. We believe that the recent unprecedented efficacy and safety data for Keplita in our MVD Phase 3 studies profoundly expands the impact Keplita will have in the treatment of mood disorders.
Sharon Mates: As we approach this major MDD approval milestone, we wanted to give you our perspective on the tremendous market opportunity that we see for Keplita across the mood disorder spectrum and provide the rationale for our confidence.
Sharon Mates: First, as I noted, Keplita's efficacy results in studies 501 and 502 for the adjunctive treatment of MDD are truly exceptional.
Sharon Mates: This efficacy was confirmed in both studies not only by the primary endpoint, the MAGIS total score, but also by the strong results in the clinician-rated CGIS scale and the patient-reported QIDS scale.
Sharon Mates: This data further builds on the consistently strong efficacy data we have seen in our pivotal studies throughout our CAPLIDA development programs.
Sharon Mates: Keplita's robust efficacy is complemented with a favorable safety and tolerability profile, including a favorable metabolic, weight, and movement disorder profile.
Sharon Mates: Metabolic disturbances, weight gain, and motor adverse events are major reasons why patients discontinue their treatment and often result in poor clinical outcomes.
Sharon Mates: Another important feature of Keploida is its convenient dosing. Keploida is dosed once a day with no need for titration, with or without food, making it an attractive option for prescribers and patients.
Sharon Mates: These are important attributes that become more critical as the medicine is used by broader patient populations.
Sharon Mates: With this compelling profile, we are excited about Keplita's potential for the treatment of MDD, a large market with unmet medical needs. There are over 21 million patients with MDD and current antidepressant therapies do not adequately address depressive symptoms in more than half the patients currently using them.
Sharon Mates: There are few drugs approved for the adjunctive treatment of MDD, and there is still a significant unmet need for efficacious, safe, and well-tolerated medicines for these patients.
Sharon Mates: As a result, we believe CAPLIDA is well positioned to become a drug of choice across the spectrum of major mood disorders.
Sharon Mates: Starting with bipolar depression, Keplita has the broadest label in this indication, which includes Bipolar I and Bipolar II patients, and as monotherapy and as adjunctive therapy.
Sharon Mates: In patients with mixed features and anxious distress, difficult-to-treat patient phenotypes, we have also reported robust positive clinical results.
Sharon Mates: The potential addition of the adjunctive MDD indication not only adds a large patient population that can benefit from Keflavida, but also gives prescribers additional confidence about the efficacy, safety, and tolerability of the drug across multiple patient populations.
Sharon Mates: In our view, this position kept LIDA as a top-of-mind choice for prescribers when treating a broad spectrum of patients, including patients with a diagnosis of Bipolar I or Bipolar II disorder or MDD.
Sharon Mates: We have demonstrated our commercial expertise and have the financial resources we anticipate will be necessary to maximize Teplita's full potential.
Speaker Change: Taking all this together, we believe Kepler-LIDAR represents at least a five billion dollar opportunity within the next ten years.
Speaker Change: This reflects our expectation that Keplita will become a leading treatment across the spectrum of mood disorders and is primarily driven by contributions from bipolar depression and MDD, and to a lesser extent, schizophrenia.
Speaker Change: In addition to CAP-LIDA, we have a very rich pipeline which includes additional lumatech loan programs as well as other novel programs.
Speaker Change: This will result in significant clinical milestones in the near and medium term.
Speaker Change: In terms of our LumaKeperon Long-Acting Injectable Program, we commenced clinical conduct in our Phase I Single Ascending Dose Study, evaluating four different formulations.
Speaker Change: Our objective is to develop formulations of treatment duration of one month or longer and over the next year We will be prioritizing the formulations with the best profile as we proceed with this phase one study
Speaker Change: Let me now touch on our ITI 1284 development programs, which we are very excited about. Patient enrollment is ongoing in our Phase II clinical trial evaluating 1284 in patients with generalized anxiety disorder, or GAD, as an adjunctive therapy to generalized anxiety medications.
Speaker Change: We believe GAD represents at least a $1 billion opportunity for ITI 1284. Currently, there are only five drugs approved for the treatment of GAD and only as a monotherapy.
Speaker Change: Anxiety prevalence and severity is on the rise and recent reports suggest a prevalence of 20 million patients in the U.S. with 13 million patients being treated.
Speaker Change: About half of patients who receive treatment do not respond adequately to initial therapy.
Speaker Change: If approved, ITI-1284 would represent a new mechanism of action in the treatment of GAD and be the only drug approved for patients who have failed prior medications.
Speaker Change: We believe ITI 1284 is well-suited for this patient population and may offer an effective, safe, and well-tolerated treatment.
Speaker Change: Patient enrollment is ongoing in our ITI 1284 phase 2 clinical study evaluating patients with psychosis associated with Alzheimer's disease. We are pleased to announce that we recently commenced patient enrollment in our phase 2 program in patients with agitation and Alzheimer's disease.
Speaker Change: All of our ongoing Phase II studies with ITI 1284 are large and designed as potential registration studies.
Speaker Change: Continuing with our pipeline, our Lenmis-Poden phase two clinical trial in Parkinson's disease is progressing, and we expect to complete this study by the end of 2025.
Speaker Change: ITI 1020, our second molecule in our PDE1 platform, is being developed for certain cancers and cancer-related comorbidities. ITI 1020 is currently advancing through a Phase I single ascending dose study.
Speaker Change: Lastly, we are very excited about our 1500 program, exemplified by ITI 1549, a non-hexogenic neuroplastogen.
Speaker Change: We believe that ITI 1549 holds great promise as a treatment of mood, anxiety, and other disorders.
Speaker Change: ITI 1549 may offer a safe, effective medicine with a novel mechanism of action that can be conveniently administered without the risks associated with psychedelic hallucinogens.
Speaker Change: Earlier this year at the Society of Biological Psychiatry Annual Meeting,
Speaker Change: and the recent Society for Neuroscience meeting, we presented results from our clinical work.
Speaker Change: showing that ITI1549 is non-hallucinogenic, provides improved social interactions, reverses anhedonia, and decreases anxiety-like behaviors in animal models.
Speaker Change: Preclinically, ITI 1549 has also been shown to enhance neuroplasticity by stimulating the mTOR signaling pathway in the prefrontal cortex and to increase neurite growth and complexity.
Speaker Change: ITI 1549 is completing IND-enabling studies and expected to enter human testing in 2025.
Speaker Change: In summary, we are very excited about our bright future. We are confident in our ability to capitalize on the substantial growth opportunities ahead. We have experienced high-performing teams, and we are in a strong financial position.
Speaker Change: I am proud of our accomplishments and look forward to building on this success.
Speaker Change: I'll now turn the call over to Mark to provide details on Teplitis performance and commercial plans. Mark?
Mark Neumann: Thanks, Sharon, and good morning, everyone.
Mark Neumann: Caplita registered another strong performance in Q3 with robust year-over-year growth in total prescriptions of 38% and a sequential quarter-over-quarter growth rate of approximately 9%.
Mark Neumann: demonstrating strong commercial execution as we overcame a traditionally slower quarter for the antipsychotic market due to summer seasonality factors.
Mark Neumann: Hepatitis growth again outpaced both the branded antipsychotic market which grew at 4% this quarter as well as the overall antipsychotic market which grew at only 1%.
Mark Neumann: Cephalitis market-leading growth is being driven by its continued strong uptake in bipolar depression and is being sourced by significant increases in both the breadth of our prescriber base as well as an increase in the average depth of prescribing.
Mark Neumann: During Q3, we added 4,000 new first-time prescribers of Kaplana, having now increased that cumulative total since launch to over 49,000 unique prescribers.
Mark Neumann: We expect this strong growth trajectory to continue in the fourth quarter and throughout 2025 as we continue to invest to optimize the growth of capillita in bipolar depression.
Mark Neumann: To this end, we recently completed an expansion of our sales force during Q3, adding 150 new sales representatives to leverage the growing opportunity with primary care physicians in Keflita's current indication.
Mark Neumann: This new sales team is now in the field promoting Capillata for bipolar depression in primary care offices.
Mark Neumann: Capilite is a broad label which includes both Bipolar I and Bipolar II depression.
Mark Neumann: provides us with an opportunity to expand our reach and educational activities with primary care physicians as we have seen an increasing role of primary care in treating bipolar depression.
Mark Neumann: Early feedback to the messaging has been highly positive as primary care physicians value Keplaitis' compelling clinical profile of strong efficacy and favorable metabolic weight and movement disorder profile coupled with convenient once-daily dosing with no titration.
Mark Neumann: Primary care physicians view all of these product attributes to be beneficial in treating their patients with bipolar depression.
Mark Neumann: It will take some time for this new sales team to be fully optimized in their territories, so while we expect to see some positive effect in the fourth quarter this year, we believe most of the impact will be realized in 2025 and beyond.
Mark Neumann: We also continue to make substantial progress in our commercialization planning for a potential label expansion in major depressive disorder, which would increase our total addressable market for Kapalaita from nearly 50% of antipsychotic prescriptions for schizophrenia and bipolar depression to nearly 80% with the addition of an MDD indication.
Mark Neumann: We believe the robust results in studies 501 and 502 will position cathelita as a leading option in the adjunctive treatment of MDD.
Mark Neumann: And, coupled with our existing data in bipolar depression, we will look to establish Keplita as a first-choice treatment across mood disorders.
Mark Neumann: There are more than 30 million adult patients in the U.S. with either bipolar depression or major depressive disorder representing large medical conditions.
Mark Neumann: The substantial growth in the bipolar depression market and the strong uptake of recent new drug launches in MDD both speak to the important unmet medical needs for efficacious, safe, and well-tolerated treatment in both patient populations.
Mark Neumann: We believe Capilita will play a leading role in addressing these needs.
Mark Neumann: Our recently completed expansion provides the opportunity to promote keflavida and bipolar depression to primary care physicians.
Mark Neumann: and allows these prescribers to gain familiarity with capilita use and enhance brand awareness ahead of a potential label expansion in MDD.
Mark Neumann: To fully optimize the launch in MDD, a second primary care sales force expansion is planned for 2025 in connection with the potential approval of CAP LIDA for the adjunctive treatment of MDD.
Mark Neumann: We will share more details of those plans at the appropriate time next year.
Mark Neumann: In summary, we believe we are well positioned to drive consistent growth of capillita and to maximize the significant opportunities ahead of us in the coming years.
Speaker Change: I look forward to continuing to update you on the successful launch of Capilina. I'll now turn the call over to Sanjeev to further discuss our financial performance. Sanjeev?
Sanjeev: Thank you, Mark, and good morning, everyone. Great to be with you today to share my thoughts on the recent quarter and our full year expectations.
Sanjeev: First, I'd like to start off by saying how honored I am to have joined the Infra Cellular Therapies Leadership Team as Chief Financial Officer.
Sanjeev: I'm thrilled to be part of the company during this exciting time of growth.
Sanjeev: Since I began in August, I've been meeting with colleagues across the company and I'm impressed with the high caliber of our talent.
Sanjeev: I believe we have the right strategy to grow Capalita in its approved indications and look forward to the potential launch in MDD next year, as well as advancing our robust pipeline.
Sanjeev: I am confident in our strong fundamentals and the company's growth potential.
Sanjeev: I consider it a privilege to partner with Sharon and the rest of our management team to continue to create significant shareholder value.
Speaker Change: Our third quarter results represent another strong quarter in Keppleider's growth trajectory.
Speaker Change: As Sharon mentioned, Capilita's net product sales increased to $175.2 million, representing 39% growth versus the same period in 2023.
Speaker Change: Our net sales grew 9% sequentially versus Q2 2024, primarily driven by increased prescription demand.
Speaker Change: Our gross net percentage in the quarter was in the mid-30s, consistent with our expectations.
Speaker Change: Selling general and administrative expenses for the third quarter were $132.1 million compared to $105.2 million for the same period in 2023.
Speaker Change: The increase was mainly a result of the primary care sales force expansion, as well as increase in the marketing, advertising, and general administrative expenses to support the company's growth.
Speaker Change: Our R&D expenses for Q3 were $66.8 million compared to $41.6 million for the same period in 2023.
Speaker Change: Our pipeline continues to advance.
Speaker Change: In the third quarter, R&D expenses increased primarily due to activities associated with luma cheperon and other clinical programs.
Speaker Change: specifically the initiation of our phase 3 bipolar mania studies, our phase 3 pediatric program, as well as our ITI 1284 phase 2 studies in GAD and psychosis and agitation studies in Alzheimer disease.
Speaker Change: Now let me say a few words on Kiefer and Fuller guidance ranges.
Speaker Change: We expect Net Product Sales momentum to continue driven by strong prescription demand.
Speaker Change: We expect our gross net percentage to remain in the mid-30s for the fourth quarter.
Speaker Change: As a result, we're raising our Capilite Net Product Sales Guidance Range to $665 million to $685 million for 2024.
Speaker Change: Given the year-to-date spend at this time, we're narrowing our full-year SCNA expense guidance range to $490 million to $510 million and our full-year R&D guidance range to $220 million to $230 million.
Speaker Change: Finally, our financial position remains strong. Cash and investment total $1 billion on September 30, 2024, compared to $499.7 million on December 31, 2023.
Speaker Change: To recap, our business fundamentals are sound. We're ending the year with a positive momentum. With a strong balance sheet, we believe we are well-positioned to maximize capitalized potential and continue to invest in our pipeline program.
Speaker Change: This concludes our prepared remark. I'd like to hand it back to the operator to open the line for your questions.
Speaker Change: Certainly, as a reminder, to ask a question, please press star 1 1 and wait for your name to be announced. To withdraw your question, please press star 1 1 again. Please limit yourself to one question.
Speaker Change: And one moment for our first question.
Speaker Change: Our first question will be coming from Andrew Tsai of Jefferies. Your line is open.
Andrew Tsai: Hey, good morning. Thanks for taking my questions. Congrats on the quarter and the strong execution. My question is around your sales opportunity comment for Capalata, $5 billion over the next 10 years. So, are you thinking a fairly equal sales?
Andrew Tsai: mix between MDD and bipolar or expecting MDD cells to be meaningfully larger than bipolar. And just bigger picture is, is it fair to assume you're expecting CAPLIDA ultimately to be prescribed more than the rest of these other antipsychotics out there, the branded ones at least? Thanks.
Speaker Change: So, thanks for the question, Andrew, and thanks for the kind words in the intro to your question. Maybe, Mark, would you like to address the question?
Mark Neumann: Yeah, sure. Thanks for the question, Andrew. To reiterate, at least at a high level, Sharon's comments and her prepared remarks, what the forecast reflects is really our confidence.
Mark Neumann: That Keplita will become a leading treatment option across mood disorders, across Bipolar 1, Bipolar 2, and MDD, and the forecast is primarily driven
Mark Neumann: by bipolar depression and MDD and, to a much lesser extent, schizophrenia, which continues to grow nicely but is the least of the three indications. To give you a little additional color for bipolar depression,
Mark Neumann: We see CAPLLIDA continuing on its current growth trajectory.
Mark Neumann: which leads to significant market share gains over time. And capillata becomes one of the leading treatments in bipolar depression.
Mark Neumann: For MDD, we recently conducted some rigorous quantitative market research, which confirms our belief that studies 501 and 502
Mark Neumann: represent a best-in-class profile for Caplyta and we believe that'll lead to a market-leading share among the branded antipsychotics so
Speaker Change: To your question, Andrew, both bipolar depression and MDD contribute very significantly to the overall estimate that we have of achieving $5 billion within 10 years.
Andrew Tsai: Thanks, very helpful, congrats again.
Andrew Tsai: Thank you.
Speaker Change: And one moment for our next question.
Speaker Change: Our next question will be coming from Jessica Fye of J.P. Morgan. Your line is open.
Jessica Fye: Hey guys, thanks for taking my question. Just following up on the prior question, can you just touch on what prompted you to unveil this five billion dollar long-term target for Caplyta now? And then I have a follow-on.
Speaker Change: Thank you. Thank you. Thank you.
Speaker Change: Thanks for the question, Jessica. I'll start and then I'll ask Mark or Sanjeev if they want to chime in. As you know, we are continuously being asked...
Speaker Change: by the street.
Speaker Change: Thank you.
Speaker Change: what the market opportunity is for both Kaplaita and folks in our pipeline. Just as early on
Speaker Change: We did not give you revenue guidance.
Speaker Change: we think as we mature.
Speaker Change: It is time for us to be giving you our internal forecast as we refine them, too, and as we get the confidence in the potential for what we've been finding in all of our market research and all of our internal forecasting. Mark, do you want to add anything to that?
Mark Neumann: No, I think that's exactly it, Sharon. I think we've always believed in the potential of Kapalaita in certainly the near term, but also the long term. I think when we saw the results of studies 501 and 502, we were certainly impressed by
Mark Neumann: the very robust efficacy and favorable safety and tolerability profile and MPD and now we've had a chance to do some rigorous quantitative market research which confirmed
Mark Neumann: our impressions of what that profile represented and I think it just all of that added to the confidence that we have about the long-term potential of Kaplan.
Mark Neumann: And I think also with the increase now with the launch of our primary care dedicated sales force, I think gives us even further confidence and
Speaker Change: These drugs are being prescribed more and more in the primary care setting, as well as, not only by physicians, but by nurse practitioners and PAs, etc., in the mood disorders.
Speaker Change: So, we think that all of this builds on the confidence to support these numbers.
Speaker Change: Okay, and then just one quick follow-up on the pipeline. Curious if you could just speak to how enrollment is going in the Phase 2 GAD study for 1284. Is there any chance we could see the anxiety data for 1284 next year?
Speaker Change: Well, I'd never say never, but, um...
Speaker Change: Typically, one doesn't do their projections based on enrollment speeding up, you do your projections based on enrollment either being status quo or slowing down. So I think that we stick by the guidance we've given to date and if next year something changes, we can let you know about that.
Speaker Change: All right, thank you.
Speaker Change: And one moment for our next question.
Speaker Change: Our next question will be coming from Charles Duncan of Cancer. Your line is open.
Charles Duncan: Super. Thanks for taking the questions. Congrats on the quarter.
Charles Duncan: I had a question really on pipeline. When you consider LAI and what other companies are being challenged with LAI, how important is that for the LUMA franchise?
Charles Duncan: versus, say, 1284, et cetera, in terms of the vision longer term. And then you have a lot of pipeline candidates. Could you tell us what you're most excited about? It's a little simplistic, but let me know what your thoughts are.
Speaker Change: We started the development of LAIs for patients to have another option.
Charles Duncan: As you know, we're now testing for four different formulations, and as I mentioned in our prepared remarks, that study is ongoing, and throughout next year, we will have
Charles Duncan: further data as we're basically pitting these different formulations against each other and we'll be looking at the safety, the tolerability, at the PK values and certain ones will drop out.
Charles Duncan: we anticipate. I think.
Charles Duncan: I think that it is separate and apart from our
Charles Duncan: Kaplaita franchise which we
Charles Duncan: continue to see as growing very substantially over time and we're very excited about it. As for 1284, that again is a separate pipeline right now and I think that we're very excited about GAD. It's a huge opportunity.
Charles Duncan: And we think that we would really be paving the way for...
Charles Duncan: drugs with new mechanisms in GAD and I'm really we look forward to seeing that data.
Charles Duncan: As to which, what do I like best or what do we like best,
Speaker Change: , they are all the best. I have said this before, I don't want to be a one-on-one meeting, I say that is like asking you which child of yours do you like the best. I think , we will continue to look, we are a science driven company and we will continue to look at the science and we will continue to look at the data.
Speaker Change: and, you know, assuming the data is good for each.
Speaker Change: Clinical trials all continue to progress.
Speaker Change: If there's some hiccups in data as we go forward, those programs may get culled. So we'll let the science drive us, and the data is always there.
Speaker Change: the most important thing to help guide you in your development of these programs.
Speaker Change: I guess not. Okay. One moment for our next question.
Speaker Change: Our next question will be coming from Jason Gerberry of Bank of America Securities. Your line is open.
Jason Gerberry: Hey guys, thank you for taking my question. Mine is around the guide. If I look at the midpoint, it implies that the annual growth rate steps up in fourth quarter close to
Jason Gerberry: I think high 40% versus 39% growth rate year-on-year in 3Q. So as I think about that acceleration in growth, I'm wondering if you can kind of just...
Jason Gerberry: flag the tailwinds there. Is this Salesforce expansion? Is this getting some uptake in Unipolar MDD or mixed features or just something else? Appreciate it. Thanks.
Jason Gerberry: and Jeeves.
Jason Gerberry: quarter growth on a quarter which typically has seasonality of summer and then we outperformed the market in general as Mark pointed out if you look at the entire psychotic market
Jason Gerberry: on the branded antipsychotic which grew 4% and the overall antipsychotic market grew 1% and we grew 9% so that momentum continues with us.
Jason Gerberry: So what we expect.
Jason Gerberry: Q4 generally stronger, and that's why we expect that. And then also...
Jason Gerberry: Even though primary field force is just being operational in the field, probably we'll see most impact in 2025, but we do expect some impact of that in
Jason Gerberry: in the fourth quarter. So if you take the midpoint, Jason, we expect to grow a little, if you take the midpoint, we expect to grow sequentially 11%. So from a 9% to 11%, I think it's pretty reasonable and be confident about our guide from that perspective.
Jason Gerberry: Okay, thank you.
Speaker Change: And one moment for our next question.
Speaker Change: Our next question will be coming from Jeff Hung of Morgan Stanley. Your line is open.
Jeff Hung: Thanks for taking my question and congratulations on the progress. Following up on the LAI program, what are your expectations on demand for that formulation and what proportion of patients might be interested in long-acting lumateperone versus the current dosing? And then I have a follow-up.
Jeff Hung: Yeah.
Jeff Hung: This is Sharon. Thanks for the question. I think it's a little too soon to tell. Again, we're going to be driven by the data. We do not expect the LAI.
Speaker Change: Thank you.
Speaker Change: The percent penetration is anywhere from 5% to...
Speaker Change: The highest number I've ever seen is 10, but usually it's about 8% as the highest number. So I think that we don't really expect there to be any impact on our oral franchise. I would like to just remind you that
Speaker Change: Given the
Speaker Change: Kaplaire.
Speaker Change: We really think that patients...
Speaker Change: like taking an oral compound very much, and so we really don't see much impact there. We will be updating you as we go forward.
Speaker Change: on what we see with these different formulations and we'll let you know.
Speaker Change: Great. Thanks. Those are helpful. And then maybe quickly, you indicated that additional results from the Phase 3 MDD studies will be shared at upcoming conferences. Are you presenting data at ACNP? And if so, what new aspects of the 501, 502 data might you be sharing with the medical community?
Speaker Change: different aspects of the studies, both 501, 502, and also the open-label study, the 503. So, all that will be included, and also the data that was not released. Only we talked about the top-line results. We'll be talking about the secondary endpoints. Additional post-hoc analysis will be presented at the meeting.
Speaker Change: Great, thank you.
Speaker Change: And one moment for our next question.
Speaker Change: Our next question will be coming from Brian Abrahams of RBC Capital Markets. Your line is open.
Speaker Change: Hi everyone, this is Nevin An for Brian. Congrats on a great quarter.
Speaker Change: I just have a couple of questions on the peak sales guide that you have provided. In regards to that...
Speaker Change: How are you kind of thinking about what the shape of the MDD expansion could look like?
Speaker Change: Post-approval there and would the VRAILR launch into MDD be perhaps a good comparison or do you believe you could potentially bend the curve even more given the efficacy and safety profile of CAT5 that's been shown?
Speaker Change: And then are you also seeing any early effects of the recent CAR-XT launch into schizophrenia and do you anticipate that there might be any shared erosion that could occur as that launch progresses?
Speaker Change: Mark, take that.
Mark Neumann: Yeah, sure Nevin, let me start with your second question with the launch of the CAR XT product. We haven't seen a lot out there yet. It's too early to see the prescription data coming through. Our understanding is that they're launching this week.
Mark Neumann: are really dissatisfied with existing antipsychotics.
Mark Neumann: And typically on the safety and tolerability side, which is where Capaleta has really had its gains.
Mark Neumann: in schizophrenia.
Mark Neumann: So we don't see any one product dominating that schizophrenia market. And secondly, as we've talked about,
Mark Neumann: In our prepared remarks and some of the questions, the long-term potential for Kapalaita is really in the mood disorders. That's where we're going to see the real significant potential across Bipolar I, Bipolar II, and MDD, and we don't see
Mark Neumann: the CarXT product competing there. So we don't see a big impact there. As far as the shape of the MDD curve, yeah, we, again, with the market research that we did, we do expect a rapid uptake in MDD. If you look at the analogs in the past,
Mark Neumann: both our own and the sort of the hockey stick inflection that we saw when we got the bipolar depression indication.
Mark Neumann: We would expect at least a similar type of uptake in MDD given the profile that came out of 501-502.
Mark Neumann: And this is consistent with other antipsychotics that have added mood disorder indications like bipolar depression and more recently MDD with Braylor. And we think that the success that Braylor has had in the marketplace with MDD really reflects
Mark Neumann: What was our belief all along? That there still remains a very significant
Mark Neumann: unmet medical needs for a product with robust efficacy.
Mark Neumann: which was delivered in 5.01 and 5.02 with a favorable safety and tolerability profile which we replicated in MDD a similar profile that we saw in bipolar depression and so on schizophrenia and with the addition of a convenient dosing regimen.
Mark Neumann: Once a day, without regard to food, and the physician can start the patient.
Mark Neumann: at the effective dose and not have to titrate them up. So all of those things taken together we think will lead to a rapid uptake in MDD and supports the overall guidance that we've provided on the $5 billion opportunity.
Speaker Change: Great, thank you so much.
Speaker Change: One moment for our next question.
Speaker Change: And our next question will be coming from Michael DiFiore of Evercore ISI. Your line is open.
Michael DiFiore: Are there any incremental updates regarding your plans for pursuing an anxious, distressed indication separately?
Michael DiFiore: Additionally, are there any specific geographic regions targeted for this expansion? Thank you.
Speaker Change: Great. Thanks. So, I'll ask Suresh to address the anxious distress.
Speaker Change: And maybe what you can do is define anxious distress and talk about how the DSM addresses anxious distress. And then, Mark, if you could address the question on the Salesforce example.
Speaker Change: Yes.
Suresh: In terms of the anxious distress, that is a specifier that was added into the DSM-5, and we have looked at anxious distress in patients within slightly different, having who has MDD, major depressive disorder, or bipolar disorder, in the mood disorder space.
Suresh: have symptoms of anxiety, and there are five symptoms they have classified. Of those five symptoms, if they have at least two symptoms of anxiety, that is considered anxious distress.
Suresh: and also there is a rating for severity having 3, 4, or 5 that the severity increases.
Suresh: We have looked at these patients in our...
Suresh: studies, both in our bipolar mixed feature study, the 403 study.
Suresh: We also looked at the MDD population in that, also having mixed features and anxious distress. And we have shared the data earlier that it was robust in both these populations of MDD with anxious distress as well as bipolar with anxious distress.
Suresh: We also looked at, further, in our Adjentio MDD program, and we have seen good results in that, and we'll be presenting that data in our next conferences.
Suresh: This is also important because anxious distress patients are difficult to treat. They have higher comorbidities and also have higher suicidal tendencies.
Suresh: suicidality both in terms of thoughts and suicidal ideations.
Suresh: So this is also important in terms of...
Suresh: treating the patients, knowing that the patients who are the clinicians' offices, if they have anxious distress, co-morbid with MDD, that the option that for lumateparol is able to help those patients.
Suresh: This is in terms of what anxious distress is.
Suresh: We'll update you on this program further as we get further along and as we start presenting all of this data.
Speaker Change: So then if we could go to the second part of your question on Salesforce expansion, Mark.
Mark Neumann: Yeah, sure. Mike, regarding further Salesforce expansion next year, we will provide you more details in later calls. What I would say is our current Salesforce stands at about 530.
Mark Neumann: And we will be expanding that further. And I will say, the early feedback on the messaging
Speaker Change: The single dose, once daily dosing, that the primary care physician can start the patient at the effective dose and not have to titrate up.
Speaker Change: is something that they really see as beneficial in treating their patients. So the early feedback
Speaker Change: on our expansion into primary care is that the message is resonating very well. Now, looking to the future, we're also very excited, as we've said, about the commercial opportunity.
Speaker Change: of the potential label expansion in MVD, and we will look to invest behind the brand at a level that will optimize that launch and the growth prospects that we have.
Speaker Change: for the brand. So as we've done in the past, we'll share more details of those efforts and that expansion at the appropriate time next year.
Speaker Change: Got it. Thanks so much.
Speaker Change: Thank you.
Speaker Change: And as a friendly reminder, please limit yourself to one question.
Speaker Change: Our next question will come from Mark Goodman of Lerig Partners. Your line is open.
Speaker Change: Thank you. Thank you.
Speaker Change: Again, Mark, your line is open. Hi.
Speaker Change: Yeah, hi, good morning. This is Basma on for Mark. Thank you for taking our question.
Speaker Change: We have a question regarding the 1284. Can you elaborate a little bit more on the differentiation of 1284 from COPLIDA? We were actually wondering whether the deuterated formulation yielded further improvement on the safety profile, especially with regard to the sunless range. Thank you.
Speaker Change: Especially what? I'm sorry, I missed the last part of your question. With regards to some of it, please.
Speaker Change: Yes, okay. Thank you. I'll start and I'll ask the rest if you want to add anything. So, yes, we are very excited about the 1284 program and several different indications, and we will have even further indications.
Speaker Change: as we progress with these programs. We did phase one studies in normal healthy volunteers and in one cohort of elderly.
Speaker Change: safety profile is very good and in fact
Speaker Change: You hit on what we saw in the elderly population especially is a decrease in the somnolence.
Speaker Change: It's a small patient population and we're looking at whether that
Speaker Change: more of the parent.
Speaker Change: We are looking to explore the meaning of that in terms of efficacy, in terms of where we go with that, if it's in the dosing, or if it's in the treatment.
Speaker Change: whether it's in the indication that are extremely difficult to treat patients etc so we're looking at all of that
Speaker Change: Suresh did you want to add anything? No, nothing for the sharing.
Speaker Change: Okay.
Speaker Change: Thank you.
Speaker Change: Thank you. One moment for our next question.
Speaker Change: Our next question will be coming from David Amsellem of Piper Sandler. Your line is open.
Speaker Change: We'll be right back. We'll be right back.
Speaker Change: Hey, thanks.
Speaker Change: Another question on
Speaker Change: atypical antipsychotics are used.
Speaker Change: specifically for GAD. What is the level of prescriptions that we generally see for for atypicals?
Speaker Change: in this setting, whether it's monotherapy or adjunctive therapy. And as you look at that opportunity, is your goal here essentially to...
Speaker Change: expand the overall antipsychotic footprint by offering a product with a differentiated profile. I guess, how are you thinking about this in terms of share gains versus market expansion? Thanks.
Speaker Change: Thanks for the question. Mark, do you want to start and then either Suresh or I will chime in afterwards?
Mark: Yeah, sure, David. In the research that we've been doing and as we've been looking at the GAD market, we actually see a lot of similarities.
Mark: with how the antipsychotic market evolved in MVD. You have a condition that's highly prevalent, about 20 million patients a year. Most of them get first-line therapy that does not adequately treat their disease.
Mark: And even though there are no antipsychotics currently approved in GAD, there is some off-label use.
Mark: What you tend to see is GAD many times is comorbid with other mental health conditions like depression, like bipolar depression, and other things.
Mark: And so you're dealing with a patient that has both a depressive disorder as well as an anxiety disorder. And so, adjunctive use of an antipsychotic...
Mark: is something that I think physicians probably see as similar to how they would use...
Mark: an antipsychotic and treating MDD adjunctively. Now certainly there is also patients with GAD as their only condition.
Mark: The penetration of antipsychotics into that segment is less because there's no antipsychotics currently approved for that. So I think...
Mark: We believe that with good clinical results in GAD for 1284, this is a large market, it's a market that we think we could penetrate well both in the patient with comorbid conditions but also
Mark: in the patient that is suffering from GAD alone. So maybe I'll stop there and ask if Suresh or Sharon, you have any further comments on that?
Sharon Mates: I don't, but maybe Suresh, do you have any comments on the drugs that are being used now and what our opportunity is?
Suresh: Yes, in terms of the GAD, the current drugs that are approved are very limited in terms of for mainly SSRIs and SNRIs. There are only five drugs that are approved for
Suresh: for long-term use, that is darloxetine, that is Cymbalta, Effexor, Paxil, and Lexapro, and also we have the Goosebar, another medication that was approved, and we have Bebenzos for short-term, but we cannot use them for long-term.
Suresh: All these are approved as first-line therapies.
Suresh: So we see an unmet need in patients who do not respond to these medications.
Suresh: And similar, as Mark was mentioning, that people, prescribers are prescribing antipsychotics for patients who do not respond. And this will be similar to what we have seen with MDD, where initial days of MDD, adjunctive treatment was added on.
Suresh: So, we see similarities there, and also from the mechanism of the 1284 and the safety profile, we believe that this will be a good opportunity to pursue this indication and also help the patients.
Suresh: with patients who do not respond to initial therapies.
Speaker Change: Thank you. Thank you. Thank you.
Speaker Change: As in our bipolar program where we had a study that was a monotherapy program and another
Speaker Change: clinical study program that was adjunctive use. We're following a similar path in GAP so right now we have ongoing the adjunctive treatment and very shortly we will begin study therapy.
Speaker Change: Thanks again.
Speaker Change: One moment for our next question.
Speaker Change: And our next question will be coming from Joel Beatty of Baird. Your line is open.
Joel Beatty: All right, thanks. On the expectation of Caplyta reaching $5 billion in sales, what kind of changes in pricing over time are built into that projection?
Speaker Change: Mark, do you want to address that or Sanjeev?
Mark: I can start and Sanjeev if he has anything he'd like to add. We've assumed moderate improvement.
Mark: So that's how I would characterize the pricing assumptions that we've used for that forecast.
Mark: Thank you.
Mark: Okay, I think that's what we have. Do we have any more questions?
Speaker Change: We do have additional questions. Oh, okay. I think we have time for one or two more. Certainly. I think one more. Our next question will come from Corrine Johnson of Goldman Sachs. Your line is open, Corrine.
Corrine Johnson: Alright, thanks guys for squeezing me in here. Um, maybe, um, from us...
Corrine Johnson: Can you just talk a little bit about the Salesforce expansion kind of post next year? Do you think you'll be pretty right-sized for MDD at that point, or will, should we anticipate kind of like continued Salesforce expansion over the coming years? Maybe you could just talk a little bit about like your philosophy around how you think about the Salesforce size relative to the market opportunity things.
Corrine Johnson: Mark.
Corrine Johnson: Thank you. Thank you.
Mark: Yeah, Corinne, our expectation is once we complete the expansion...
Mark: next year which will take us...
Mark: further into primary care. Predominantly, we will be right-sized to
Mark: optimize the launch and the growth prospects that we have for Cathleta. Over time, you always re-evaluate that and any market conditions that might change, we'll constantly re-evaluate that, but we expect that the expansion next year will get us where we need to be, which is highly competitive with a product profile that the market research suggests is the best in class profiles, and we think that'll be a combination that will allow us to maximize the opportunity that we have in MDD.
Speaker Change: Thank you.
Speaker Change: And one moment for our next question.
Speaker Change: And our last question will be coming from Craig Seminoff of Mizuho Securities. Your line is open.
Craig Seminoff: Thanks so much for taking my question. Congrats on the quarter. I was just very curious about the 1284 program and your comments around the phase 2 studies as you've designed them as being registrational. And so the question is assuming positive data in one or or all perhaps even.
Craig Seminoff: in order to secure approval. In other words, are there more trials that are likely or could these be the trials that support an SNDA, or I'm sorry, an NDA, thanks.
Speaker Change: So I think that the one that is where the regulatory pathway is extremely clear is in GAD, or at least the clearest I should say, and so assuming that the two
Speaker Change: studies are positive, we would go and discuss with the FDA.
Speaker Change: them being the efficacy studies that are required for our
Speaker Change: for our filing. And then, of course, we'll have rollover safety, long-term safety studies as well.
Speaker Change: And so I think that program is very clear. On the other indications, I think it's a little too early, on the Alzheimer indications, it's a little too early to say anything.
Speaker Change: But we will update you on that as we get further into next year.
Speaker Change: Thank you.
Speaker Change: Thank you. Thank you.
Speaker Change: And I would now like to turn the call back to Sharon Mates for closing remarks.
Sharon Mates: So thanks everybody for joining today. As you can see, I think we're very pleased with the progress we've made. We're very pleased with
Sharon Mates: the performance of Keplita and our ability to help patients. I want to just remind everybody that's.
Sharon Mates: How we started this journey is to help patients and
Sharon Mates: to expand the population of patients that we can help.
Sharon Mates: So, I think that we are advancing on our mission and we look forward to continuing to do that and to updating you on our progress. With that, operator, you can disconnect the call.
Speaker Change: This concludes today's conference call. Thank you for participating. You may now disconnect.