We're gonna get going here with our next company presenter at the BofA Annual Healthcare Conference. Pleased to be introducing Axsome Therapeutics and Mark Jacobson, Chief Operating Officer. My name is Jason Gerberry. I'm one of the mid-cap biotech analysts at BofA, and Mark, thanks for joining us. Thanks, Jason. Really glad to be here, and, you know, it's nice to be at the conference again. Mm-hmm. And thanks for hosting us. Yeah. So, I figured maybe we could kinda start the discussion with the validity of the kind of dynamics going on in the MDD market. Then we could pivot to ADA, and then the hodgepodge of other pipeline topics that are, you know, most relevant. Sounds good. All right. So yeah, I guess with Auvelity reported nice quarterly results, kind of annualizing at a run rate that I think you guys are happy with, relative to expectations and all the hurdles you deal with nowadays, launching a drug- Mm-hmm. - and building up, building up coverage. Maybe just and not looking for specific quarterly guidance, but just more of the kinetics, right, of where Auvelity is, some of the 1Q drags, and just kinda the outlook for the rest of the year, conceptually. On the one hand, it does seem like, you know, there were some factors, typical 1Q seasonality, that could be headwinds for volume. Change Healthcare was flagged as sort of a minor thing, I think. Yeah, I think, I guess when you're building up coverage, maybe, I don't know if the 1Q seasonality factors get a little more exacerbated from a volume drag perspective, and then as you kinda get into the remainder of the year, you know, what that portends for just kind of the volume kinetics. Sure. No, thanks. So Q1, I think we're pleased with kinetics and dynamics all around, despite seasonality backdrop, and then, as you mentioned, some environmental headwinds, so to speak, with Change Healthcare disruption and things like that. So, you know, $53 million in the first quarter for Auvelity, and it was about 95,000 scripts. Mm-hmm. So, really like that. Maybe the other element for Q1 was the expansion of the field force. Mm-hmm. And added about 100 reps, so total Auvelity field force is right around 260 right now. And what we shared is that we expected to see impact from the increased field force, and starting in about a quarter. And I think we're starting to see that. The last few weeks, you know, we're starting to see you know, nice movement or dynamics in NBRx, TRx, so we like that, and we'd expect to continue to drive that over the course of the year and beyond. So I think that's one of the key elements. And another thing that we had just shared is that, we've added another contract with a second GPO, and so that's, you know, that's essentially a leading indicator for other lives in the commercial channel to be covered. And so we expect that to start to develop further over the course of the year. Yep. Okay. And the dynamic of, how you're approaching kind of the contracting and not wanting to give away too much- Mm-hmm, mm-hmm. and building up volume Yeah ... and increasing your leverage. This is a strategy that's not unique to Axsome. I see- Yeah - in other companies that I cover, employing this sort of strategy. So, is sort of the thinking, Hey, we can operate, you know, broadly drive volume growth within our kind of gross to net outlook we've provided to the street, and then over time, be it a year or two from now, we feel like we can get to broad coverage ultimately, and then we're only growing in sort of the leverage and power you have with payers in the contracting discussion. Yeah, yeah. No, that's right. So we, you know, steady state, we, I think, expect to be in line with, with what you typically see for, for branded, you know, CNS or, or neural products. And, and so that's, you know, government channel, you know, essentially 100% of lives are covered, and, and that's the case now. And, and then in commercial channel, you'd expect the, the, the majority of lives to be covered, you know, the overwhelming majority of lives to be covered. So right now, it's at, at 48% at the end of the first quarter, and, and so we'd expect that to, to tick up, and that, that corresponds to when, say, PBMs or plans access rebates or, or put the product on the formulary, and, and generally, those are step functions, right? Mm-hmm. It's not gradual. It depends. And you're right, the plan is to drive volume, and that corresponds to increased field force and things like that. And as we drive volume, then we'd expect to see, say, commensurate placement on formulary for Auvelity. Okay. So yeah, that work is underway, and we're pleased with, you know, where things stand right now and how things are moving. What would you say are the biggest risks to that strategy that could, you know, if you were to say, "Hey, look, in a year or two's time, you know, if the gross to net was gonna be worse," is it that you have a harder time pulling patients through medical exceptions, where you don't have the contract in place? Mm-hmm. I don't think there's an NMDA agent in the pipeline, so- Yeah Seems like the payers would have a hard time going to exclusive contracting. Yeah. So that seems like a positive. But how would you kind of frame risks if there are risks? So, you know, it's a different approach than, say, a free goods program, where you look to get as many patients on drug as quickly as possible and through a free goods program. So it's different than that. So we do wanna drive volume. I think maybe one of the things you have to be mindful of is that, as you ramp up, as more HCPs may write the product or have familiarity with it, you don't want it to take so long that a perception crystallizes, that it's difficult to write, right? So you do wanna make sure lives continue to be added, and then that if an HCP writes the product, that they'll feel good that it'll get filled. Mm-hmm. So while we're navigating while we're coming out of or through the NDC block phase, we have a pretty robust patient support offering that will help patients get, say, get the first script or early scripts while a PA may be routing for, you know, through submission and potential approval. Mm. Should that process, should a PA result in approval, then a payer would be covering the product for any given patient. So that's underway now. It takes time, and, you know, it takes a lot of work to drive the volume. But if that continues to grow, then obviously, that's what drives uptake or payers accessing the- Mm-hmm ... you know, contracted rates for rebates. So it sounds like you're acutely focused on minimizing friction for the prescriber, such that there's not this ingrained bias that, "Oh, Auvelity is this hard drug to get," and thus, they kind of just don't think about it as like a go-to option for a patient that might be a candidate. Is that a fair summary? Yeah. Yeah, no, and I think that idea is, you know, we're not seeing that now, but I think just in terms of your question, what are, for an approach like this, the things you wanna be mindful of? Yeah. So, that's something the team is mindful of, and, you know, again, we like the current dynamics, though. So, and kind of where we are, you know, say, launched to date and, you know, progress we're making on, say, on the market access front and, just, you know, the demand front. Mm-hmm. So I think we like where we are, so that's good. But I'd say that's probably the biggest potential kind of headwind for an approach like this. Yeah. Okay, and then in terms of like... I, I wonder where, where you're winning share. You get questions a lot about- Yeah ...early line versus kind of later line patient, and I'm wondering, you know, I think there's something like 3 million treatment-resistant- Mm-hmm ... MDD unipolar depression-type patients. Well, how can you define the dynamic in-play market in a given year that you're fighting for, you know, in certain disease areas that, you know, have a lot of generics- Yeah ... have, like, adjunctives at the back end, right? Like, that maybe get used in- Yeah ... those more severe patients. You'd be placed somewhere in the middle, I assume. Yeah, it's pretty interesting. So right now, there's not a specific, say, patient profile that's emerged, where all the usage or what the product is being written for. Instead, it's- Mm-hmm ... it, it's across a variety of patient types, and so one of the things that we're seeing, you know, early trends is that we're seeing it prescribed for first line or first switch. And I think the latest numbers are more than 40% of the scripts are first or second line. And so that's a great place to be. But then it's also, to your point, being used in very late line patients, which is what you, you know, you often see that with new branded products, right? They're generally started later line because of NDC block and prior auth and things like that. So we're seeing it used kind of across a spectrum of patient profiles, which is really good because then the feedback we're getting from the field or from clinicians is that the product's working in line with the label and kind of despite its utilization in a heterogeneous patient profile. So we like that set up, and so where it actually nets out, or if there's, say, a specific or a few specific patient profiles, I think that's still coming together, but right now, we like kind of the snapshot that we're seeing. Yeah. Okay. Yeah. So you have this peak sales guide of a $1 billion-$3 billion for- Yeah ... the drug. If I think about some of the variables, you know, the impact of these upcoming marketing initiatives, how that alters the trajectory- Yeah ... if you get an extra 6-9 years of IP beyond 2034 IP, that's obviously a big- Mm-hmm ... variable to, you know- Yeah ... where you end up from a peak sales perspective. So what's the biggest toggle if there is one that you can- Mm ... or if you can rank order those elements? It's hard, it's hard to know, and I think that's one reason for the range. But we feel really good about the potential for the product. And to your point, the runway, it's got a long runway. You know, there's the Paragraph IV process underway now, but we feel really good about that and just the lifetime of the product. But that's a toggle, as you said, I think other things, one element is what we were just talking about. If it settles on a specific patient profile, then that's an element that could impact that. Another topic we were on, which is basically coverage, where steady-state coverage comes in at, and say, you'll expect a variety of types of formulary placement, where these payers all have what's important to them in terms of coverage dynamics and market basket, and things like that. So all of that has the potential to, I think, impact where we end up from a peak perspective. But I think in our minds, it's... The opportunity is substantial, and I think as we go, when things start to, you know, when we have a sense of maybe long-term trends, then I think we can hone- Mm-hmm. Hone that guidance potentially. But right now, we like the range of possibilities for peak. So you didn't mention sort of the synergism with an ADA indication- Mm. But is that a big swing factor to sort of the MDD, you know, maybe benefit you might get with the broadening of, of the label? Sure. Right. So if Auvelity, so AXS-05, it's in clinical development right now for AD agitation, right? We have the two positive phase III studies, and there are others that are ongoing, and we can touch on that. But, you know, should the product be approved for Alzheimer's disease agitation, that would potentially open up, say, other potential targets- Mm. or so HCP targets or settings, for example, and I think what you're alluding to is long-term care facilities as one potential area. And in that case, there are a lot of individuals who... There's a high prevalence of depression in settings like that. And so that's- Mm. Yeah, that's a potential area that could come online, so to speak, with respect to the depression opportunity. Yeah. So, yep. Okay. Last one on this topic, and then we'll go to Alzheimer's. But, a lot of us look a Rexulti as a launch comp, right? Mm-hmm. We'll sort of track where you're at on a monthly basis, well, sort of a like-for-like basis. I guess I'm just curious your thoughts on that as a comp. On the one hand, I guess I could see the pushback being, hey, that typically gets used as an adjunctive. You know, there are safety risks with that that maybe could cap utilization, right? Mm-hmm. In terms of physician willingness to want to put someone on a typical, antipsychotic, movement disorder, risk, that sort of thing. So do you, do you view that as a comp? Do you look at that, or do you say it's just massively inappropriate? It's probably a combination of relevant and totally irrelevant, you know. So the product is approved for Alzheimer's disease agitation now, and it's about a year in to the approval. Yeah, I was thinking about it from an MDD perspective. Oh, I'm sorry. Yeah. I see. I see. So from an MDD perspective, it's an analog. I think it's a relevant analog, but the profiles are so different, right? To your point, the efficacy profile is different, the tolerability profile is different, you know, from... And also the use case, as you mentioned, for adjunctive. And for Auvelity, we have distinct safety and tolerability profile, right? Rapid acting, durable. So I think the analog is there in terms of the product is available, and clinicians have experience using it for individuals with depression. It breaks down somewhat from a product profile perspective, right? They're not necessarily analogous. The other thing that's different, too, is just, I think, market dynamics for the products, the sales platform that's in place and so I think it's informative, but how much of a facsimile? I don't know if- Yeah. Okay. Yeah. Let's move on to Alzheimer's. You know, you announced the start of the ACCORD II trial. I guess the questions we get a lot are: Why and why now? Yeah. I think, I think why now is... So we have the positive of ADVANCE I and ACCORD I studies, and then we have the open label extension study that's going ongoing, and the ADVANCE II parallel group study that's ongoing. So the two ongoing studies, those are, you know, we're about to enter, say, the home stretch of those studies. And so soon it's gonna be pencils down in terms of preparing an NDA. And the team's going through a process now to think about: How can we build the strongest package that we can? How can we get as much FDA data to the FDA as possible? We really like the profile of the drug and the totality of the data we've generated to date. So what else can we do to bolster the program? In a sense, there's this open window in terms of the number of patients in the OLE, in the open label extension study. There are enough potential patients to explore doing something like this. And that was really the genesis. Timing of, Hey, what else do we want to put into the package? Patients are there to run a study like this. It's not—I don't think we'd be doing this if this were another standalone study that we'd have to recruit from scratch, right? But it's no, we don't expect there to be a material impact or cost. We don't expect there to be a material impact of timing of the NDA. So to us, it just makes sense that all of a sudden we can add even more randomized controlled data to the package. We think that's a good thing. Mm-hmm. And, yeah, I imagine you get questions around with those two ongoing trials and different scenarios and outcomes. It sounds like no matter what happens with those, the plan would be to file, you know, sometime. I know you don't, haven't guided a filing timeline. Yeah, yeah. But the plan would be to file it in a reasonable timeframe after this is all completed. Yeah. I think that's right. And so it's gaming out different scenarios. It's all speculation at this point, but I mean, the team goes through that process, right? And so thinks through that. But you know, again, we are, we're-- where the state of affairs today, I think, is... We've got the two studies, and then we have now two other additional studies that are ongoing. So then potentially we'll have two parallel group and two randomized withdrawal studies in addition to the open label extension. So we think that's really good, and I think just for the suite of potential things that could happen between now and say, completion of data generation, we think that set of studies will be good for say, completion of a package or- Mm. building out a package. And so on the one hand, these two studies, ADVANCE II and ACCORD II, are effectively replicates, right? Of trials- Yes. that you've done, and you've done successfully. Correct. And then on the flip side, if we just think the isolated trial risk, right? Yes, yes. Alzheimer's patients are heterogeneous. They're- Mm-hmm. complicated, sometimes they're- Yes ... running trials, and so what are sort of the external just risks of running trials in AD, and specifically AD agitation, as you just sort of think about that space? Sure. The, I think you mentioned some of it is just heterogeneity, but of course you, one works to, you know, work to, you know, works to, to manage that, so to speak. That's the wrong word, but through inclusion/exclusion criteria, right? So you try and get appropriate patients through inclusion/exclusion criteria and study design. And, you know, I think one thing is just expectation bias, right? That's ever present in any study, especially psychiatry. So that's there. And so you're mindful of that. And, you know, other elements, it's the typical things that you have say with phase III studies, say, you know, variability across sites or things like that. So I think that's all present and that goes into the thinking of the team about how do we build the strongest package that we can? And that's why I think why we like the set of studies that we'll have. Mm-hmm. As you think about the market opportunity and observations from the Rexulti ADA launch- Mm-hmm. I know you guys have talked about wanting to play in maybe a patient who's maybe more mild to moderate in their disease, who may still be at home- Yeah ... who may be a patient that you can get in front of their agitation symptoms- Yeah ... more so. Can you frame how you execute that strategic from a strategy perspective, right? We're watching other Alzheimer's launches, which probably have, like, totally different- Yeah ... types of launch dynamics because they're infusion type of products. We're looking at Rexulti, which has- Yes ... a black box warning for mortality. Yeah. In a lot of ways, we're trying to understand where you guys could play and how you'd go about winning in that space. Yeah. No, it's a good question. So right, on the one hand, it's a very large market, but it's also, in a sense, a new fledgling market, right? It's newly developing. There's work being done now from a disease state awareness. I mean, there's conventional wisdom around it, and then HCPs see it all the time, right? And of course, the agitation, and that is a key symptom for why individuals are placed in long-term care facilities. That's when family members or caregivers are no longer able to care for those individuals. And so you can see those things, and so there's definitely an algorithm, so to speak, around how that happens. But in terms of, say, defining patient profiles or patient type, I mentioned disease state awareness, that there's a lot of work that will need to be done there because it's truly an unmet medical need, right? There's one product now, it's within a class of products that was used off label because nothing historically was approved for Alzheimer's disease agitation. So there's definitely a lot of work to do, and then the team has started that process now. So- Yeah ... you know, the commercial team in terms of, you know, pre-launch activities and things like that, that's all underway. And of course, that's also part of the thinking for why we want to generate as much data as we can right now. And because, you know, should the product be approved- Mm-hmm ... that, then there's even more, say, clinical data that can inform, say, medical information or say, you know, marketing content and materials and things like that- Yeah ... or what's consistent with label and data sets that were generated. So that's all part of the approach there. I know you guys haven't commented yet, sNDA versus NDA- Mm-hmm ... or what this product from a reg path perspective looks like, but I guess ultimately, like the main tangible difference is a different label and some other factors. Like, what are some of the pros, cons of a different label, potentially, like if there is an ability to have a different gross to net strategy, just things like that? Yeah. Yeah. The team is working through there now. I mean, there are, say, a number of other recent. You know, there are precedent examples or analogs of, say, the same product with different brand names, and that sometimes if it's very different indications or if there's some key difference in formulation of a product, and you may see that. And so work is underway now, and the team is making that determination. And, you know, there are all kinds of considerations, right? You mentioned gross to net. We talked earlier about potential overlap in patients with, say, in target potential writers. So there's a lot that goes into it, and, you know, that work is active right now at the company. Mm-hmm. So, yeah. How does the field force evolve with ADA coming online? And I imagine that the neurologist, maybe it becomes part of the detailing panel, versus right now, you're probably primary care and psych-focused. Yeah, I think that area of focus is still a key area of focus, say, if the product is approved for Alzheimer's disease and agitation in particular, because a lot when individuals present with agitation, they often, you know, it's often for those types of HCPs. Neurologists, too. I mean, the targeting network is underway right now. What we really like about how we've built the sales platform, so to speak, and then we have, you know, essentially a psychiatry field force right now. Mm. That's Auvelity, and then there's the sleep team. Mm. But those will grow, and the way those will, you know, right now they're steady, and but what I mean is as new products or new indications come online, they're scalable. So we can calibrate based on the new target universe or expanded target universe that we think is appropriate for new potential indications. But right now, for AD agitation, there's high overlap with the current field force. So there's a lot of synergies there, you know, say, from an SG&A perspective. Yeah. Okay. Maybe just shifting gears to the AXS-12 narcolepsy- Yep ... update that you had. You know, very competitive space, right? But also, like, a lot of drugs that have a lot of drawbacks to them. Yeah, yeah. Right? Yep. So how do you- Yep ... feel based on the data, how it stacks up? Yep. You know, do you see this as sort of competing, potentially taking share away from, say, a sodium oxybate type of product? Mm-hmm. Maybe more of a bridge product between wake promoters and a sodium oxybate- Yep ... even, but you don't have a REMS. You won't have a REMS, presumably. Yeah. And, there might be a bit of an easier prescription from that perspective. Yeah, I think that's a key, a key component and exactly where the product might fit. I think to have any precision there, we'd want to see a label, of course. But to your point, tolerability profile is much different, daytime dosing. There are, you know, you wouldn't expect it to be scheduled, and then, say, some of the challenges with the products that are currently available, tolerability, either in terms of the underlying drug substance or how they're delivered in formulation, say, salt considerations and things like that. It's AXS-12 doesn't have those considerations. Mm-hmm. So we really like the overall profile, say, agnostic to the label, but exactly where it could fit. I think that will depend on the label. But definitely based on the data we... Right, so looking at narcolepsy and in particular, cataplexy, right? So that's the primary, but then we show, you know, significant improvement in severity of excessive sleepiness and, you know, improvements in cognitive function, improvements in overall narcolepsy severity. Mm-hmm. So that's all really good for the product profile. And so in our minds, there's a very meaningful opportunity there. And of course, you know, we were just talking about the field force and we have in place, right, a sleep field force- Yeah ...and team already. So there, there's a lot of synergy there, too. Just to push a little on that point, right? Yeah. Like I look at the data, and I guess I don't think there's a lot of label variables. Like, I don't think that there's a lot of, like, swing factors that'll, you know, come out of like a decision on label. And then I guess- Mm-hmm ... doctors use antidepressants like venlafaxine. Mm-hmm. And so- Mm-hmm ... you know, some would say, all right, like they're sort of trained in how they use ADTs, and so why would this not just get slotted in where venlafaxine gets used? It's possible it, you know, I agree, maybe the universe of possibilities for a label is, you know, not an infinite universe. Mm. But it's still hard to know because it can form, you know, very, very key elements of approach. But to your point about why is it important? We, you know, so we have another product that hits norepinephrine, right? But it does not work for cataplexy, right? Just sleepiness. So there are differences, but for say, the class even within the same class or- Mm-hmm ... or a similar class. So I think, I think that's why it will be important, to see a label. Just ultimately, how the cataplexy benefit gets characterized, is that- Yeah. No, in terms, you know, I think just overall, how studies may be described on a label or what gets incorporated into a label. Yeah ... and things like that. Okay. Yeah. All right. Well, fair enough. Yeah. Well, we're up against time. Cool. Thanks so much for joining us. No, thanks for having us. We really, really appreciate it. Yeah. So, cool. All right, great. Thanks.