Axsome Therapeutics, Inc. Aktie

Good afternoon. Welcome to our next session. It is my pleasure to be hosting Axsome Therapeutics with Nick and Mark, CFO and COO of the company. Nick and Mark, welcome. Great to host you guys. This is the first time that I'm hosting you guys at the GS conference. So very excited to really appreciate to have this conversation with you. So before we go through all the questions, I'm going to turn it to you guys for opening remarks.

Sure. No, great. And thanks for having us, Richard. It's really good to be here, and it's so far, a really, really productive day for us. So I appreciate the opportunity to chat with you.

And just to get things started, Axsome, we are a CNS-focused biopharma. We have 3 products that are currently on market. With our recent approval for Auvelity, this is our product for -- it targets NMDA and sigma-1. It was previously approved for major depressive disorder. It's been on the market for about 4 years and was recently approved for Alzheimer's disease agitation. We're very, very excited about this as a treatment option for patients, substantial area of unmet need. And we're launching that this month. So we're really excited to be here and talk about that.

We have 2 other products. One, SYMBRAVO, for migraine, and the other is Sunosi for excessive daytime sleepiness and obstructive sleep apnea and narcolepsy. And then we have a very broad and deep pipeline, from early stage to multiple late-stage programs, multiple positive Phase III trials, NDA stage submission programs. So we can run through all of that, but it's great to be here and happy to be chatting with you.

Fantastic. So when you think about the company 10 years into the future, okay, as you're -- with the ambition to build a large cap company, is it realistic to only focus in neuroscience given the high risk associated with -- in development? Or should you also expand into other areas besides neuroscience?

The -- it's a great question. And obviously, we have our annual planning process and quarterly and tactical planning process and then our long-term strategy process. And the company was started to focus on CNS. And the reason for that was the industry had really moved away -- and this is 14 years ago, right? The industry had really moved away from neuroscience, psychiatry, neurology.

And you alluded to a key reason for that, which is studying -- do you have an active molecule and can you detect a signal? And can you design a study to detect a signal? Are there accepted instruments from a regulatory perspective that you can use to develop products for areas of unmet need? That was -- at that point in time, due to those -- those are a few of the considerations, industry had moved away.

And that's why the company was started. Herriot Tabuteau, our CEO, he founded the company to work on some of those challenges. And over that -- since then, we've gotten really good at building a pipeline of active molecules, designing studies to detect signal and then taking those programs, engaging with FDA and developing viable regulatory pathways and then launching them. So that's our sweet spot now, and there are still numerous areas that are underserved in CNS. So that will continue to be our North Star.

But then at the same time, we're very much data-driven and value-driven. So if there are programs or opportunities that in the future, for some reason or another makes sense or are synergistic with our future commercial infrastructure, whatever it may be, I don't think that should be so surprising. But I think as we look ahead, the North Star for our [indiscernible].

Yes. And I think maybe just one thing [indiscernible] growth over the last 5 years, right? Since 5 years ago, we look completely different than where we are today. But I would venture to say 5 years from today into 2031, we will look even that much more different than where we were 5 years ago. We had -- 5 years ago, we were roughly probably less than 100 employees. We're north of 1,000 now. No revenue, clinical stage company back then. Obviously, tracking really well now with the growth that we've had with the 3 products that we have and now 4 indications.

So -- and you look 5 years ahead and you take a look at the story right now is all about Auvelity and in ADA as well as MDD, but there is a robust pipeline behind Auvelity with up to 10 indications that we've disclosed already, upwards of close to $20 billion in total peak sales. So we're super excited about it. And as Mark was saying, like I think the DNA within the Axsome team is an ownership mentality and really focusing on what makes sense from an investment perspective.

I see. Okay. Got it. First of all, I mean, congratulations on that recent approval in ADA for Auvelity. Can you talk about just kind of based on the label, what are sort of you think are the advantages in that label that you want to draw out that lead you to increase that peak sales guidance to $8 billion? I think previously, it was lower for the 2 different indications. Even when you combine it, it was lower. So what drove that rationale? And what -- anything that you want to draw out from that -- from the label?

Sure. Yes. So I'll start with the label, and then maybe Nick can talk about how that percolated into the data and our calculations. But the label, so if you start with the product itself, I touched on very quickly, the mechanism of action. So it targets NMDA and sigma-1. So mechanistically, it's differentiated from -- in the indication, the products are primarily used off-label. 99% of products that are prescribed for AD agitation are used off-label. Mechanistically, it's -- and there's one approved product, of course. So mechanistically, it's distinct from what's been used historically.

And then that flows into efficacy and tolerability. So the risk-benefit profile from an efficacy perspective, we have different trial paradigms that are in the label in the clinical trial section. So you have a typical "longitudinal" study where we see very rapid separation and onset of action. So starting at week 2, static at week 3, carrying through to the endpoint. So that differentiating is the rapidity of treatment effect.

And then we have a long-term efficacy trial in the label, and that speaks to the duration of treatment, right? So we actually treated patients for up to a year. And in certain cases, some patients were treated longer. And you saw a very, very durable treatment effect. You did not see increasing rates of adverse reactions over time. Very, very low dropout rates. And so that shows up in the label in a nutshell from an efficacy perspective.

And then with that strong efficacy is a very tolerable or very clean safety profile. The only two most common adverse reactions were dizziness and dyspepsia. So just very, very clean. We didn't see sedation. We didn't see a fall signal. We didn't see a mortality signal. We didn't see a tardive dyskinesia signal.

And that, of course, all makes sense mechanistically. But the -- so it's very clean with that strong efficacy, which makes for a very important treatment option for patients and caregivers and potential prescribers. And then that has then translated into, okay, with that approval, it's time to reassess our expectations for the product.

Yes. So some of the things that went into the $8 billion was just, I think, first and foremost, just the current trajectory that we've seen with MDD. Right now, we're at 22 basis points of the entire antidepressant market. So less than 1/4 of the total antidepressant market. However, we are seeing early signs. As it relates to the NBRx, we're at 0.4%. So essentially doubling in market share on the NBRx versus the NTRx. And what does that mean? That's just a leading indicator of where we expect NTRxs to go. So very nice trajectory.

And one thing that we've also seen secondly is with our expansion, we expanded from just under 300 reps to just north of 600 reps most recently. And if you just take a look at since May, when these reps have been on board, so since May 1 through today, we've seen a significant increase in our NBRxs going from roughly 2,700 to upwards of 3,200 NBRxs per week. Another way to look at that is just 14% growth over that time versus some of our branded competitors at 4%. So 3x the growth of what our brands are with the expansion solely on MDD by itself.

And then the other thing, one of the reasons why we've also increased the peak sales is our payer coverage is now at 86% total covered lives, 100% in the government channel and 78% in the commercial channel. So robust covered lives with good formulary access. And seeing where our net price is currently, we're very pleased with how that product is doing in total in MDD.

What I'd maybe add to that is you layer in what we're seeing from an uptake perspective over the past year, uptake from a trialist to, say, a doctor. And so when -- what we're seeing is when clinicians try the product in a handful of patients, there is noteworthy and substantial adoption of the brand. And that lines up with the different elements that Nick was talking about us going further into primary care, coverage being at a point that if it's being written kind of regardless of the the line of therapy that's being written for it, it will generally be filled. And there's room for even additional improvements in the quality of coverage. So it's kind of all the different elements when you think of market access, sales, marketing, clinical activity. It's all very consistent, robust growth.

Yes. And maybe one last thing, Richard, even in MDD. So we have not -- we've invested very minimally in marketing and advertising. We just started investing in Q4 and a bit in Q1. So what we've been able to achieve with north of $600 million in annualized sales is with very minimal DTC, with a scaled -- a small -- compared to our peers' field force and with market access coverage has come in over line.

We haven't spoken about the ADA necessarily, but there is 20 million, 21 million scripts written annually for Alzheimer's disease agitation. And when we looked at our model, we looked at very conservative peak -- I'm sorry, very conservative market share for Alzheimer's disease agitation as well as we took conservative views of what compliance and persistence would look like. And we're -- we felt very comfortable sharing that $8 billion peak sales.

I see. Got it. So I want to dive deeper into some of these details. And I think you guys mentioned like payers and so forth. So based on some of the discussion that you guys have been having with payers, I mean, how -- I think you guys mentioned Auvelity will be mostly covered under Medicare Part D, and I assume the rest is split between commercial and Medicaid.

Maybe just talk a little bit about what -- for that Medicare Part D, what's the effect of the PBM reform in that segment of patients? What is the GTN expectation for now, Auvelity compared to before ADA? Is that going to change the GTN?

Understood. Yes. So currently, for MDD, so the original indication, our split between -- for our scripts was 70% commercial, 15% Medicare, 15% Medicaid. We would -- we're assuming that for ADA, that we would have north of 80% in Medicare Part D, and the remaining would be mostly commercial and from Medicaid.

So again, 100% total covered lives. We would anticipate that our GTN for this year to be in the same trajectory as we had in previous years. So worse in Q1, but slightly improving throughout the year. This year, we actually started off at a better starting point. We were in the low-50s versus mid-50s in the previous year, and we would expect a similar trajectory for 2026.

I see. So does it imply that the rebates that you give to payers would not change the amount of rebates?

The main...

With the addition of ADA?

Sure. The main difference between Medicare Part D and commercial coverage is there's no co-pay assistance, but there's additional rebates as well. So it remains to be seen where GTN is, but we don't think it will have a negative impact. At a minimum, we believe that it will further strengthen the improvement in GTN in the next couple of years.

I see. Got it. So you mentioned that the commercial launch is on track for this month, and the expansion with the sales force with that as well. Can you just go over that commercial strategy? And how do you expect to get that updated peak sales? And then what sort of like activities that you have to or investment you have to put into the commercial launch?

Sure. The commercial strategy overall is -- the product is highly distinct and an important treatment option for both indications. So the strategy is to attend to both indications and ensure both continue to grow robustly.

And when you think about pulling that through to, say, different commercial function sales, you touched on the expansion. So the expansion to 630 sales reps, that's substantially complete and has been substantially complete for a few weeks now. And those folks, those team members have been in the field for the past few weeks and actively detailing depression.

And the -- we're starting to see some of that translate into new-to-brand scripts. So we've seen new-to-brand scripts start to tick up. Usually, that takes 1 to 2 quarters, but we're seeing that already. That's just detailing efforts around depression.

The -- since the approval at the end of April, we have been working on ensuring the sales team is adequately trained and robustly trained on AD agitation. So when we say the launch is on track, that's primarily what we're talking about is sales reps in the field educating and detailing [indiscernible] and that is commencing or beginning to [indiscernible] now starting to talk about both indications. That's underway.

From an access perspective, I think the strategy at a high level is secure as many -- it's, I think, the same as it always is, which is secure as many lives as possible with your kind of guiding objective as unrestricted access. And of course, it's heterogeneous, what you have. But the quality of coverage, we want it to be such that if a clinician wants to write it first line, that it should generally be filled.

So that's in a very, very good place, but the strategy is to get that in an even better place depending on the payer or GPO or PBM or regional plan, however you want to do that assessment. So market access strategy remains the same, facilitate writing for both brands, and you want that to line up with how the team is detailing. So I talked about how the sales team is detailing. And feel free to jump in.

Maybe, Richard, a little bit more around our expansion, how we're thinking about deploying the team or how the team is deployed is, as we mentioned, we have north of 600 reps. So essentially, taking a step back, we started with 160 reps back in 2022. We had these huge geographies for reps where they spend a lot of time -- a lot of windshield time going from doctor to doctor.

What we're able to do now is make these territories smaller, and we're actually duplicating effort there. So we essentially have 2 reps that are focused on 1 geo. The geo is actually smaller, but now we're actually able to see higher decile doctors. So call it, decile 6, 7 doctors up to 10, where we're able to see them more frequently, so once or twice a week, but then the team also has individual HCPs that they can reach out to.

So essentially, we're getting better breadth. We're getting better depth with each of these doctors. And then from a target list perspective, the team goes out and is prepared to either speak as a first call point or second call point depending on what that doctor typically writes for. So if they have a patient base that maybe is more elderly, perhaps they'll speak more on the ADA indication and then support it with MDD and vice versa.

And then we also have a smaller team that is focused solely on long-term care facilities. And essentially, that's more like a key account manager. These are facilities that -- it's not a -- you go in and spend 30 minutes and go out the door. It's more of an investment in time and understanding all the key players within the long-term care facility. So that team is also going to be deployed, we're expecting from a long-term care facility, later this month. They will be they will be detailing specifically on those facilities.

And I think one last key point, we've never called on long-term care. This is the first time that the team -- that the Axsome team has called on long-term care. And it's not just going to be for Alzheimer's disease agitation, but it will also be for MDD. There is a significant comorbidity between ADA and MDD and significant prevalence just in MDD alone. So the team will be calling on LTC for both indications.

Got it. And then when you look at MDD and ADA, these are two very different conditions. And then the patients, there's some overlapping patients or patients who don't overlap. Maybe just kind of looking at that, what are some synergies in that launch that you can apply from MDD into ADA? I think you guys mentioned earlier that you just kicked off the DTC for MDD. Is that necessary for ADA? Maybe just a little bit about the learning that you can use across these two very different indications? And where are sort of the areas that are very different? Maybe to kind of learn as you go.

Sure. I'll take that second question first. So we -- as I said earlier, from an MDD perspective, we did just start doing DTC in Q4 of last year. We did do a bit also in Q1, but not to the level in Q4. I think there's a lot of learnings that we had as it relates to DTC in -- when I say DTC, I'm speaking mass media, TV commercials. We've always done DTC since launch, more digitally, more social media, more direct to potential target populations.

From a DTC and a mass audience or from a TV perspective, -- our focus was both linear TV and connected TV. There's been some learnings there where we think that maybe spending more investment in connected TV, your YouTubes, your Hulus and so forth of the world, that there's more of an ROI from that perspective.

And as we think about ADA, probably not going to see a TV ad this year. The idea is to educate doctors first. You don't want a patient going into a doctor and the doctor not being aware of the product or the indication. So the thinking is, let's have the reps go out in the field, educate the reps. And then as you then potentially think about DTC in '27-'28, where patients can come in the doctors are already aware of it.

To -- and to work backwards to the first question, just when you think about from a marketing perspective and targeting potential consumers, the MDD and AD agitation is very different, right? So MDD, you're working to educate the potential patients themselves or provide access to information for them. For AD agitation, it's the caregiver that you're looking to educate and provide information for.

So those are different. However, that's maybe one of the areas where there are -- where it's very distinct in terms of the patient populations. There are synergies or high overlap in a variety of elements of the 2 indications. So prescribers, you have high overlap. From a prescriber perspective, upwards of 3 quarters or even higher of potential prescribers or HCPs that we're targeting write scripts for both MDD and AD agitation in the community setting.

And then in the long-term care setting, there are very high rates of major depressive disorder. And not just comorbid with Alzheimer's disease agitation, but just in general. And Nick touched on that, that we had intentionally and historically not had efforts to long-term care facilities. So that's changing. So that will -- there's synergy for just, for example, by going into long-term care, where we can begin to educate for both indications.

And in the community setting, as we go further into primary care -- again, Nick touched on that, we're increasing our breadth and also depth to target HCPs. That allows us to see new targets or engage with existing targets more frequently who may write scripts for both indications.

And then that translates into the sales team. Nick talked about the mirroring that we have in the territories, how we're matching reps up within a territory. And so there will be a weighting for each team member who may skew a little more heavily towards MDD potential targets or AD agitation potential targets or those who are potential targets for both. So those are a couple of examples of the synergy between the indications.

I see. Okay. Got it. And then when you think about -- I think for MDD, you guys gave the split between like primary care and neurologists in the past. How are you guys thinking about here in terms of primary care versus neurologists? And then the -- from an effort perspective, how much are you guys putting into that long-term care facility? Because that's a whole different targeting, too.

Do you want to touch on long-term care? Or you want me to? From a targeting perspective, the -- we're increasing more and more, the efforts in primary care. But historically, the primary targets and riders have been [indiscernible] component for both MDD [indiscernible] psychiatrists and primary care.

The riders -- primary care today makes up a bit north of 1/3 of the riders. And what -- another way to think about that is a little bit adjacent. But as of today, the -- it's about 56% of scripts are first line or second line. And that lets you know they're earlier in their treatment journey, right? So they're starting with primary care or, say, the next potential specialist. And so that lines up with primary care and psychiatry. It's true for both indications.

It can depend geographically, right? In urban centers, there are specialists, psychiatry, neurologists, geriatric psychiatrists. They're more ubiquitous, say, than in rural areas, where your primary care doctor is all of the above. So it does depend, and that all translates into the sales operations team does all of that work, those analyses and then pull it through to how the folks actually approach their territories tactically. But the -- that is the main focus in terms of -- from targets.

Okay. Got it. And then I think for MDD use, there's a lot more shift towards earlier line. How do you guys -- I mean, in terms of like the first line and then the first-line switch to Auvelity, how do you guys expect that? What's the peak that you guys would expect in that first-line use for MDD? And then how do you think about that line of therapy use for ADA?

Yes. It's been trending nicely. So we're -- as Mark mentioned, we're -- first line, first switch is 56%. That number has grown in sequential quarters really since launch. It's roughly 15% first line.

And then [indiscernible] payer coverage and our strategy. Our strategy [indiscernible] primary care. Our focus early on was high-decile sites. We're now pivoting to primary care because there's a huge unmet need there for both indications.

What is nice about it is our payer access allows for primary care to be able to write for it and for it to essentially be a covered script. And what do I mean by that? The PAs that were originally embedded within a lot of the formularies have been removed, or the formulary coverage has improved to that first line or first switch. So essentially, primary care, not necessarily -- does not necessarily have the infrastructure to be creating, to be starting these PAs, initiating and then submitting and getting these PAs approved. So without the PAs, primary care is more likely to be able to write that script for a patient that they find that it has an indication of MDD or ADA.

As it relates to, hey, where do we expect first line, first switch to go to? We haven't necessarily guided to that. But I think the -- as Mark mentioned, unrestricted and getting to 100% is the ideal solution, but the team is working to continue to improve formulary coverage and total covered lives.

I see. Okay. And then the ex-U.S., what are the plans there? Is it time to find a partner? How do you guys think about ex-U.S.?

We said outside the U.S., that's an area of interest for us where the programs -- and obviously, there are high -- there's a high need outside the U.S. from prevalence perspective for all these indications that we're working on. So we've been focused on the U.S. historically, and we're mindful and consider different avenues to getting the products to other geographies and patients.

And so historically, we've considered potential partnerships if it makes sense. And we've done that. There's a partner for Sunosi outside the U.S., and we can talk about that. And the way we approach the programs, so as we work on some of the development activities kind of in the background, behind the scenes because there are different regulatory requirements in different geographies. So we kind of chip away or whittle away at those over time while we consider potential partnerships. And in the meantime, we focus on the U.S. business.

I see. Got it. So we're almost out of time. I have so many more questions on your other products that we haven't...

We can go another hour, if you like.

So maybe I'll just leave it to you guys for final remarks on any other key products that I know you didn't talk about. The migraine, that is another launch. Anything that you want to draw from some of the products that we haven't talked about that you think could be worth mentioning?

Sure. I mean, you touched on migraine. So that product is launching. We're almost on the first anniversary of that launch, and that's going well. We continue to invest in that, and we continue to expect to see growth with SYMBRAVO.

Sunosi, that business is growing very steadily. It's a very healthy business. We continue to expect healthy growth moving forward. The next potential commercial asset is AXS-12 in narcolepsy. We've submitted an NDA for that program, and we're waiting to hear back from FDA on their potential acceptance decision. So that -- stay tuned for that.

And then behind that, there's a whole host and choreography of upcoming clinical trial initiations and readouts, starting with solriamfetol in binge eating disorder later this year. And then we'll keep it going. We'll be starting trials in ADHD shortly. We have ongoing studies in MDD, precision MDD, MDD with symptoms of excessive sleepiness. There's a ton going on at the company. It's an incredibly exciting time, and we'll look forward to keeping you updated.

Fantastic. Well, Mark, Nick, it's been a pleasure hosting you guys. Yes. Thank you so much for the insightful discussion.

Thank you.

Thank you.

We are introducing Axsome, our next company presenter. We've got Mark Jacobson, Chief Operating Officer; and Nick Pizzie, Chief Financial Officer. So gentlemen, first off, thanks for joining us.

Good morning, everyone, and thanks for having us, Jason. It's good to be here. Obviously, a pretty exciting time for us. So it's nice to be able to chat with you.

So a lot going on at Axsome, recently a high-profile new indication approval for Auvelity and the company has been, I guess, emboldened to convey even a more bullish outlook for the franchise in aggregate. Maybe we could start there.

Just if you can talk about the approval, what was the biggest positive takeaways in terms of product labeling, how that will confer competitiveness for Auvelity, both in its newly indicated disease state as well as the legacy MDD indication.

Sure. We'd be happy to. And it's coming from a place of just what the current state of the business tells us as opposed to being feeling extra bold or bullish. It's just the state of the business, and we can talk about that.

But to your point, starting with the label, this -- the label now for AD agitation, it's incredibly clean and speaks to the underlying product profile, and that gives the team a lot of ability to educate potential prescribers for both indications.

So that ties to the need in Alzheimer's disease agitation as a serious unmet medical need. It's dramatic that we can talk about the market size and the potential there. But there's also high synergy and overlap with MDD. And so maybe, Nick, do you want to start there?

Sure. So for MDD [indiscernible] and that's 14 quarters into the launch. And as a reminder, we started the launch with 160 reps. So a very small amount of reps compared to our competitors.

And that number has grown from 160 to 260, most recently, 300, and we just did the expansion from 300 to 630 in anticipation of the ADA approval, but also more importantly, just the trajectory that we've seen with MDD. We're really pleased with where we are.

We're outperforming a lot of our competitors being only 14 quarters in. I think the other piece of the puzzle is the payer access. Access for the MDD for Auvelity is already at 86%, of which 56% of that is either first line or first switch.

So really pleased with where we are with -- from a payer access perspective. And then -- the other thing that goes along with it is just the investment. We haven't invested heavily as of yet into DTC. We started that in Q4 of last year. We like the returns that we had, but we did that with less than 300 reps on board.

So we would expect to see a higher multiplier with the additional reps that we are bringing on with the investment that we're doing in DTC. So maybe just kind of summarizing it from a quantitative perspective, we are currently at 0.2% of the total antidepressant market, annualizing over $600 million.

We're at 0.3% of the NBRx market. So NBRx obviously being a leading indicator of where we expect to be from the [indiscernible], and that number is anticipated to grow as we further invest in the field force as we further invest into the commercialization of the product.

In this idea of synergies and the benefit of ADA to MDD, and MDD to ADA, and just that virtuous cycle of greater utilization, greater comfort, familiarity, et cetera. When we look to analogs in the CNS space that have "done this indication stacking," right, and seen that benefit, it seems to me like a lot of those analogs were adding another mood disorder, right?

But it was largely a psychiatry-driven sort of opportunity like Caplyta going from bipolar depression to unipolar depression, for example. Here, you're adding a new indication that probably has more complexities to it, bigger primary care component, maybe neurology component to it as well. So can you unpack that?

Are there different analogs you look to drive comfort around this idea of synergy given that it could be somewhat different prescriber or lack of prescriber overlap?

For analogs, the ones you mentioned are fine. I don't know that we'd point to you to any others as being our internal justification for where our modeling points us. It's not that you can actually just do the analysis on the prescribers themselves.

And that's part of the team, our commercial team and sales operations of looking at your targets for each and looking at the overlap there and can you detail or do you want to detail and try and educate those targets.

So that is kind of the targeting analysis. So it's not predicated or based on another analog and how it did. But where do the synergies come from? So starting with long-term care, that's pretty straightforward, right? That is you have high rates of comorbid depression in individuals who have Alzheimer's disease agitation.

But also just in long-term care, you have high rates of depression, right? 50% to 80% of individuals in long-term care facilities are depressed, and that's not an area that we've actively educated in the past or detailed in. And so we'll be doing that now.

So you could very directly see that just educational efforts would be beneficial and synergistic in that area, right? If it's one call or one medical presentation where you can talk about both indications, I think that's straightforward.

And it's similar in the community-based setting where Nick talked about our investments in the sales force we're going out further into primary care. And depending on where you are and you do these analyses, urban centers, rural areas and certain -- whatever geography you're in, you can do the analysis, hey, who are the targets? Is it primary care? Is it psychiatrists? Is it neurologists?

And it turns out for both indications, the bulk of prescribers are primary care and then psychiatrists and then for Alzheimer's disease agitation, you do have some neurologists, geriatric neurologists, et cetera, but the bulk is primary care.

And what we see and what we've seen since launch is when there is trial by an HCP and a certain number of trials in a certain period of time, that leads to adoption. And the expansion that we did last year, it was a small expansion in the sales team that allowed us to go a little bit further into primary care, and we saw those trends.

And so now that we're -- we have this large expansion in the sales team and investment there, we expect to -- that's where the bulk of our work will be to go further into primary care, and that's where you actually see high synergy from a potential prescribing perspective.

Just to add to what Mark was saying, we did the expansion last year. We went from 260 to 300 reps. The idea there was to be more in primary care. And we saw a significant increase in NBRxs, call it, 4 to 6 months after we did that expansion at the beginning of the year, just with the 40 reps because we were able to get into primary care, but also as importantly, we were able to have better depth with our individual HCPs.

So if you think about our target list, when we started, it was really specialty, it was really heavily on psych. And we are now just recently getting more heavily into primary care. And as Mark mentioned as well, we haven't even called on long-term care centers, huge prevalence within long-term care centers in MDD, obviously, with ADA, but also with MDD.

Okay. And now the ADA market itself, right, there are certain generic antidepressants, antipsychotics. There's one branded antipsychotic approved. What do you think is the critical differentiator for Auvelity here? Is it more safety or efficacy?

When I look to MDD, psychs always say drugs got to be super safe in MDD, right? It's a critical table stakes almost, right? So when we think about ADA, is it different? Do you lead with more of the efficacy benefits or safety? Or is it a mix of both?

It's a mix of both, and it probably starts with the mechanism, right? Mechanistically, it's highly differentiated, and it's first-in-class. So it targets NMDA and sigma-1, that's highly differentiated from on- and off-label pharmacotherapies that are used for these patients. And so then what does that lead to? You see differentiated or distinct efficacy and tolerability profile.

In the label, we have parallel group efficacy data that shows the product works quickly and separates very early on, so 2 to 3 weeks. And then we have data that -- relapse prevention data. So this is duration of effect and treatment effect over longer periods of time.

And that's highly differentiated for on and off label, what's used now. And then the tolerability profile is great in terms of pairing with efficacy like that. So the tolerability profile, it's very clean, low rates of AEs. There's not a box warning for this patient population.

We didn't see sedation. We don't see a mortality signal. We don't see a fall signal. The list goes on. But if you look at the most common AEs in the label for this patient population, it's dizziness and dyspepsia, that's it. So it's a very tolerable pharmacy for the level of efficacy that you see with it. And so that's great.

And then that also -- just to further make the point about synergy, when you have trial and if the real-world experience matches the clinical data, then that's a very, very different option for patients and caregivers and prescribers than what's been available to date.

Maybe you have 600 sales individuals now that are going to be promoting both the ADA and MDD indication. How how are these sales individuals going to be prioritizing?

Is it the new indication gets more of the love versus, say, MDD, which is more established now at this point? Or is it going to be very context-driven depending upon the provider and their practice and where the opportunity could be to drive business?

It's the latter. So it's context driven. It's by target and by region and geography. So every account manager has a mix of targets who are primarily "MDD target" or an AD agitation target or they're both. And so that will drive their call plan. And so it varies. But every team member will have that mix of targets.

And it seems important to mention, so you'll launch in June, but you guys did a lot of the heavy lifting on the payer front in advance of this launch as you went through the regulatory review process.

So maybe just level set for investors what that coverage dynamic is going to look like day 1, right, in this largely Medicare Part D population, both in terms of ease of access, quality of access, step-throughs, et cetera?

Sure. Yes. So we would anticipate that every script in -- for ADA, 80% of those scripts will be in Part D. In Part D, we currently have 100% covered lives in Part D, of which 3/4 of them, so 75% of them will have no PA and first line or first switch.

So we feel very good about coming out of the gate with coverage specifically in ADA. And then the other 25% of the lives that are covered would have a PA, but we anticipate the majority of those that do have the PA would just be PA to indication. So it's not a heavily burdensome for the HCP to be able to write the product. And that would be also with first -- basically first switch or potentially something after that. So overall, 100% covered lives.

Typically, the next question is going to be related to GTN as it relates to Part D, we would anticipate that from a GTN perspective, that net price would slightly be better in Part D patients versus our commercial landscape. And that's really only due to there is no co-pay coverage allowed in Part D compared to commercial.

Next question is, one, for lack of a better way of saying it, I'll call it, plumbing in this market, right? Like where I've got an individual, their Medicare, they're in a nursing home, they're in a long-term care facility.

So they have this access, but like the facility that they're in, the ability to write the script and seamlessly ensure that, that access is obtained. And is that an awareness thing? Does your sales team need to work with these practices to understand how this all works and to have confidence that they can get seamless coverage?

Maybe I'll talk a little bit about our LTC team. So we -- of the 630 reps, there will be a portion of them that will be dedicated to long-term care. And we would -- we look at those specific reps, not as the typical specialty rep or primary rep. It's more of a key account manager.

So to your to your point, Jason, there's a bit more work in handholding with some of these larger centers to educate them on what the payer access is to establish relationships with the pharmacies in and outside of the centers as well as with those HCPs that support the centers, they also may be in the community.

Yes. I don't have much more to add to that, except the plumbing, maybe one way to say that is just that really ties to supply chain and the team has been preparing or the supply chain is already established through MDD to facilitate if a clinician or an HCP is writing the product, we want to make sure the product can -- that script can be filled and that the product is there waiting if -- when the script is filled.

So that's been -- that's behind the scenes or kind of "back office" but we've been attending to that, and we feel good about the infrastructure in place there.

Got it. And maybe just how would you frame the patient out-of-pocket cost dynamic for key subsets of this population, be it those with minimal out-of-pocket versus those that may have -- and if you've got a blended average?

Yes, sure. So a bit early on that, but what we have seen is as it relates to the patient population between non-low-income subsidy and LIS patients. So for those LIS patients that their out-of-pocket out of the gate or for each script would be something less than $13.

On average, I think it's around $3 to $5, and I believe it's also voluntary. So for those patients, there shouldn't be much of a co-pay, if any, at all. For the non-LIS patients, $2,100 is the max out-of-pocket for 2026. And they have the ability to cap and smooth, and that relates to any drug that they are taking.

So obviously, if they are on an agitation med, they're likely on probably a more expensive Alzheimer's med as well as other meds that they are currently taking related to their health. So overall, there -- we obviously can assist them from a co-pay perspective, but you likely will see that seasonality until they actually hit their $2,100 out of pocket, and then that would improve as the year goes on.

And then for us in the analyst community, how would you envision tracking the launch? Is that going to be something that will be discernible from the script data or on the quarterly updates, how you plan on educating us on the launch trajectory?

So the weekly scripts will be there, the scripts that are written for patients with Alzheimer's disease agitation, those will manifest or show up in weekly scripts.

And we will monitor that the same way through weekly scripts and then we'll have additional data that we can see through our sales infrastructure or, say, retroactive claims data.

One thing you can -- or folks can monitor or if you get scripts by channel, say, Medicare Part D or commercial channel, so folks can watch that. We'll see what we can offer for commentary, and we'll look to do what we always do, which is provide some level of detail or peel back the onion a little bit in terms of the quarterly dynamics we see. It could be potential prescribers.

It could be, say, number of detail or it's hard to know because we'll have to see what data we have, but we'll look to provide the same level of detail that we have been. But in the meantime, from a weekly script perspective, folks will have a sense of data through channel that provides kind of a proxy for it.

But it's, of course, Medicare Part D is not exclusive to Alzheimer's disease agitation, right? If we're in long-term care and we're detailing on depression, that will also likely be in, say, that channel. However, the point is what you'll be able to see is the overall performance of the brand. And I think that's probably the most important.

Yes. Okay. Shifting to MDD. Curious, you're 4 years now, I think, into the launch. So where you're winning share by line of therapy?

And if you had to like deduce the ultimate success, which would be hitting that $4 billion target, like or 2 things, right, that you'd say this has to happen, be it either this has to be adopted by primary care at a high clip or we've got to win the battle in early first second line. Like how would you frame, if you could, at a high level, what has to happen to get to that $4 billion target?

The -- it's based on current trends and uptake. So obviously, for MDD in particular, it's what we're seeing in primary care. It's what we're seeing with adoption. It's what we're seeing with how patients do and feedback from clinicians.

So -- and so we're investing further to go into primary care further as we talked about. And if we see adoption there at the rates, at the pace, the rates we see, the persistence and compliance we see if -- if that holds up, then those are the numbers we'll see.

And it's not predicated on threading some needle of certain -- some patient profile. It's where the coverage stands today, which is great for just a few years after launch and where -- how we expect it to continue to grow and evolve over time. It's the investments we'll make in the sales team and the -- how productive we've seen that those efforts to date and to see that continue.

So it's not -- those numbers aren't -- it's not a Rube Goldberg contraction that one thing has to -- one precarious event leading to another. It's -- that's the product profile. And if you just step back, Nick touched on where we are with the overall market.

It's it's not even 0.5%. It's barely [indiscernible] 0.5%, right? So it's -- the market is so large, the need is so large. And if we do our job educating clinicians and the product profile continues to be what we've seen to date, that's the numbers that we'd expect.

Yes. And we're -- yes, we're 14 quarters in, right? We have exclusivity through early 2039 with pediatric indications. So 14 quarters in of 66 quarters who's counting, but that's less than 20% of our life currently, right?

So we feel great about where we are and analyzing a $600 million with a team that, on average was somewhere in the neighborhood of 200 to 250 reps and mediocre market access up until really last year, we've been laying the roots and the foundation now for the 3 years with this approval, with the trajectory that we've seen now we're -- I'm going to use the word Vegas, I going to say we're going more all in now because with the team and with the investment that we did in Q4 in DTC, we'll see -- we'll continue to add that investment.

We don't anticipate that it's going to significantly increase from where we were in Q4. But we've laid that foundation now, and we feel really great. And we've shared that it's an $8 billion-plus number. It's not a max out at $8 billion, but it's $8 billion plus.

Okay. It seems like DTC is basically table stakes, right, in the MDD setting, if you look at like AbbVie and companies that are operating in the space, they effectively use DTC.

So curious your observations on ROI and can you envision as you evolve to this profile, if there should be step-ups in that investment from what you're seeing in terms of the ROI?

Yes. We did DTC in Q4. We had a lot of learnings from that. And one of the learnings was where to place our ads between linear, which is the traditional over-the-air TV and digital TV.

And we've learned where to place them, how to measure it, how to manage those -- that spend. It's easy just to some of our peers that are out there 24/7 and understand why they are doing that.

That's not how we spend, and that's not how we've historically invested. We've always gone with a very disciplined approach that made sense. And we will continue to invest in those areas.

I think we've gotten smarter. We started the campaign again in March, and we'll have a campaign throughout the rest of this year. But it will always be disciplined and discrete regardless of where we are today versus in 3 years from now. But I would agree, we'll always have a presence out there in one way.

Yes. And what Nick is talking about is to us that those are -- we're looking to make the most sound or best ROI decisions. So for us, the best ROI, it's the sales team. So that's where we're investing heavily. We'll invest in other elements, which is traditionally described as surround sound.

And so we'll have that. But the -- it's being done and the track record for the brand to date, it speaks to that approach that you can drive very high performance with disciplined, say, commercial investments. We'll continue to do that. But you're right, as it grows, we'll change the mix of those investments over time.

Okay. So we got about 4 minutes. So some quick hitters here, so I'll be a cut to the chase. SYMBRAVO, the early efforts are on the access build side. When do you think investors should be looking to as sort of like when you think an inflection can occur with SYMBRAVO from a revenue recognition standpoint, given where we're at in sort of the launch?

I think it comes with payer access. And we announced that we had a nice win in Q1. So as access comes online, we expect to see an inflection with net sales. We had nice script growth quarter-over-quarter. So sequential script growth, I think, was around 36%.

It's just -- and anecdotally, we've heard nothing but positive feedback as it relates to SYMBRAVO. It works really well. Safety profile has been positive. So we're pleased with where we're at.

As a reminder, again, this was a similar playbook that we had with Auvelity. We started with 160 reps in Auvelity. We have, on average, roughly 100 reps for SYMBRAVO. We did just announce the expansion because we feel great about that win as well as potential other wins that will be coming down the line.

Yes. It's -- I'll just point out, I mean, this probably goes without saying, but it's a much different market and from depression. So it's the launch, Nick is talking about our data-driven approach to investing, but the launch and how you navigate that market is much, much different from an access perspective and trial and treatment options.

So we've always shared that we're starting discretely so we can understand feedback from clinicians about the product profile, which Nick touched on, but then also the -- maybe for plumbing or the inner workings of that marketplace. So we're wrapping our head around it and now we're investing further. So we'd expect to see growth moving forward.

Sunosi ADHD, can we just talk about the dream there, if you will, right? Like is beating the non-stimulants from an efficacy perspective critical given the other inherent attributes of Sunosi relative to stimulants, right, in terms of scheduling and the safety profile considerations there.

So it seems like you're kind of trying to offer something in between what non-stimulants are and what stimulants are. And so I'm just wondering how high the efficacy bar is.

Well, the efficacy that we saw in the adult trial to date is in line with one category of the products you mentioned, which is in line on an absolute change with the stimulants. So that's great. And then there's a distinct tolerability profile, which we think bodes really well for that patient population.

Of course, we're running the experiments and we're starting the 2 trials in children and adolescents. So we'll have to wait for the data. But right now, there's real-world experience, obviously, for the on-label indications. There's the clinical data in adults. And so we have a sense of the efficacy and tolerability profile.

The scheduling is different. We see -- there are other data that we have in hand, right, that the cognitive benefit that we saw, we shared that through the SHARP study that was a couple of years ago now. That was in individuals for the current on-label indications.

But that, again, speaks to the differentiated product profile. So we've got to finish these 2 studies, and we'll be providing updates on them throughout the year. And then we'll turn the cards over and see what we have. But already, we know the product is differentiated from what's available, which is great.

And then providing different treatment options to clinicians and patients, that's our job. And then if the product is approved in the indication, then our next job will be to educate clinicians appropriately. But already, it's a differentiated product profile. So we're excited about its potential. We just have to finish the clinical program.

All right. Well, we're out of time. So gentlemen, thanks so much for joining.

Thanks for having us. Thanks, Jason.

Thank you, Jason. Have a good day.

All right.

Good morning, and welcome to the Axsome Therapeutics First Quarter 2026 Earnings Conference Call. My name is Kevin, and I'll be your operator for today's call. [Operator Instructions]. Please note, this call is being recorded. I will now turn the call over to Ashley Dong, Senior Director of Investor Relations. Ashley, please go ahead.

Thank you. Good morning, and thank you for joining Axsome First Quarter 2026 Earnings Conference Call. With us today are Dr. Herriot Tabuteau, our Chief Executive Officer; Nick Pizzie, our Chief Financial Officer; and Ari Maizel, our Chief Commercial Officer, who will begin our call with prepared remarks. Mark Jacobson, our Chief Operating Officer, and Hunter Murdock, our General Counsel will available for Q&A.

Please note that today's discussion includes forward-looking statements regarding our financial performance commercial strategy and operational plans, including research, development and regulatory activities. These statements are based on current expectations and assumptions and are subject to risks and uncertainties that may cause actual results to differ materially. Please refer to our SEC filings, including quarterly and annual reports for a description of these and other risks. You are cautioned not to rely on these forward-looking statements, which are made only as of today, and the company disclaims any obligation to update such statements.

And with that, I'll hand it over to Herriot.

Thank you, Ashley, and good morning, everyone. In the first quarter of Axsome delivered strong year-over-year growth and execution across the business. This performance was driven by our commercial products and the advancement and expansion of our R&D pipeline, which is now composed of 6 innovative potentially first-in-class or best-in-class product candidates.

Starting with our Commercial business. Total revenue for our 3 marketed products was $191 million, representing year-over-year growth of 57%, driven by AUVELITY and SUNOSI with contribution from SYMBRAVO. Building on the strong clinical profile of our marketed products in the quarter, we substantially expanded the sales force for AUVELITY, finalized plans for the expansion of the SYMBRAVO sales force and increased covered lives and quality of coverage for all of our marketed products. These initiatives will support continued strong revenue growth of the base business this year and beyond.

Last week, we received FDA approval of AUVELITY for the treatment of agitation associated with Alzheimer's disease, an indication which received FDA breakthrough therapy designation and priority review. This approval introduces a first-in-class treatment option for this highly prevalent debilitating and critically underserved neuropsychiatric condition. As such, it marks an important milestone for the millions of patients living with Alzheimer's disease, their families and their caregivers. AUVELITY has now been approved in two indications that received FDA breakthrough therapy designation and were granted FDA priority review. The approval in Alzheimer's disease agitation combined with the health of the MDD business and the recent augmentation of the AUVELITY commercial infrastructure provide us with a clear line of sight to AUVELITY's market potential. Ari, will provide an update to our peak sales estimate for the AUVELITY franchise based on these developments.

The approval in Alzheimer's disease agitation is a testament to our research and development productivity. Since the start of this year, we have continued to advance and expand the rest of our industry-leading pipeline with a focus on developing first-in-class and best-in-class products. On the regulatory front, following the FDA approval of AUVELITY last week, we are pleased to share that we have submitted our NDA for AXS-12 for the treatment of cataplexy and narcolepsy. Clinically, our ongoing trials continue to progress, and we will be starting multiple Phase III trials within the next few months.

Finally, we recently expanded our pipeline further with the addition of AXS-20 a potentially first-in-class 3 Phase III PDE10A inhibitor for Schizophrenia and Tourette syndrome. I will discuss each of these developments in detail later in the call.

All in all, Axsome is advancing the commercialization of 3 differentiated marketed medicines across 4 highly prevalent indications as well as an innovative pipeline of potentially first-in-class and best-in-class medicines that includes 6 product candidates targeting 10 different highly burdensome conditions in psychiatry and neurology. Looking ahead, Axsome is well positioned to realize robust growth driven by execution across our commercial portfolio, the long-term AUVELITY in Alzheimer's disease agitation and the advancement of the rest of our neuroscience pipeline.

With that, I'll hand the call over to Nick to review our financial results for the quarter.

Thanks, Herriot, and good morning, everyone. Our financial performance in the first quarter was strong with our 3 commercial products delivering continued double-digit revenue growth.

Total revenue for the quarter was $191.2 million, a 57% increase compared to the first quarter of '25. We expect revenue growth to continue in 2026. AUVELITY achieved net product revenue of $153.2 million in the quarter, up 59% compared to the first quarter of 2025. SUNOSI net product revenue for the quarter was $33.9 million, a 34% increase compared to the first quarter of 2025. SUNOSI revenue consisted of $32.6 million in net product sales and $1.3 million in royalty revenue associated with SUNOSI sales in out-licensed territories.

Net sales for SYMBRAVO were $4.1 million in the quarter. Auvelity and Sunosi gross net discounts for the first quarter of 2026 were both in the low to mid-50s range. We anticipate the gross to net discounts for both products to improve throughout the year, consistent with prior year trends. SYMBRAVO gross net discount in the quarter was in the high 70% range, and we continue to expect it to remain elevated over the near term as access continues to evolve and awareness continues to build.

Turning now to expenses. Total cost of revenue were $14.7 million compared to $9.8 million for the first quarter of 2025. Our research and development expenses were $52.7 million in the quarter compared to $44.8 million for the first quarter of 2025. The increase in R&D spend primarily reflects a onetime acquisition-related expense booked in the quarter. Our selling, general and administrative expenses were $185 million for the quarter compared to $120.8 million for the first quarter of 2025. The increase was primarily driven by the acceleration of prelaunch activities for AUVELITY in Alzheimer's disease agitation and commercialization activities for AUVELITY, which included the national direct-to-consumer advertising campaign and sales force expansion, along with commercial activities for SYMBRAVO.

Net loss for the quarter was $64.5 million or $1.26 per share compared to a net loss of $59.4 million or $1.22 per share for the first quarter of 2025, a $64.5 million net loss in the quarter includes $23.4 million in stock-based compensation expense.

Our balance sheet remains strong. We ended the first quarter with $305 million in cash and cash equivalents compared to $323 million as of the end of last year. Our overall financial performance reflects continued top line revenue growth and improving operating leverage driven by disciplined commercial execution. We anticipate that our current cash balance is sufficient to fund our operations into cash flow positivity based on our current operating plan.

And with that, I'd like to turn the call over to over now to Ari, who will provide additional details on the key drivers behind our medicines and the broader commercial performance of the business.

Thank you, Nick. The first quarter of 2026 was a pivotal period for Axsome's brands, reflected in ongoing demand for our medicines, meaningful improvements in payer coverage and sales force expansion activities. Our promotional efforts across HCP and patient audiences, combined with a broadening commercial infrastructure will support Axsome sales objectives throughout 2026.

Starting with AUVELITY. More than 223,000 prescriptions were written in the quarter, representing 35% year-over-year growth and remaining consistent with the prior quarter. By comparison, the antidepressant market grew 1% year-over-year and declined by 1% compared to Q4 of 2025. AUVELITY performance in the quarter was highlighted by a continued shift towards earlier line use, with first-line, first-switch prescriptions increasing to 56% of overall demand. Primary care adoption also expanded in the quarter, now representing 35% of total AUVELITY prescribers. These trends reflect meaningful improvements in market access over the last 2 years, broadened awareness of the brand, driven by our national direct-to-consumer campaign and our concentrated effort in expanding use among primary care providers, a key driver of earlier line utilization and an important foundation to support early trial in connection with the upcoming Alzheimer's disease agitation launch. Additionally, more than 5,500 new prescribers were activated in the quarter, bringing the total number of unique prescribers for AUVELITY since launch to approximately 60,000. We continue to make important progress with formulary access for AUVELITY. Commercial coverage is at 78%, and alongside Medicare and Medicaid coverage at 100%, total coverage is now at 86% of all lives across channels, establishing a strong foundation of access for AUVELITY in advance of the launch in Alzheimer's disease agitation. We expect both the quantity and quality of coverage to continue to expand and improve.

AUVELITY's growth to date in the depression market continues to reflect its compelling clinical profile highlighted by rapid and durable symptom improvement and a distinctly favorable safety and tolerability profile. Last week's FDA approval of AUVELITY as a treatment for agitation associated with dementia due to Alzheimer's disease is a significant advancement for patients and a major milestone for the brand. We are very pleased with the product label, which provides compelling clinical information regarding AUVELITY's impact on agitation for Alzheimer's patients. AUVELITY is a first-in-class treatment for this patient population, demonstrating rapid and durable symptom improvement with a favorable safety and tolerability profile. AUVELITY is the only approved treatment for Alzheimer's disease agitation with efficacy on symptom relapse demonstrated in long-term trials.

In a short-term study, the most common adverse reactions were dizziness and dyspepsia and only 1.3% of patients discontinued treatment due to an adverse reaction, the same rate as placebo. In market research, HCP's rate AUVELITY's clinical profile in Alzheimer's disease agitation as highly compelling from both an efficacy and safety perspective with clear potential for first-line use in appropriate patients. We are expanding the AUVELITY sales team to approximately 630 representatives, enabling Axsome to reach 68,000 HCP targets across primary care, psychiatry, neurology and geriatric specialists to treat both MDD and Alzheimer's agitation patients across community and long-term care settings. Our expansion efforts are substantially complete, positioning us well for the commercial launch in June. We believe AUVELITY has the potential to play a significant role in the treatment of Alzheimer's agitation, and together with the MDD indication, further broadens its use across serious neuropsychiatric conditions. AUVELITY's expanded sales force and strong foundation of coverage position the brand to drive growth across both indications throughout the second half of 2026.

Taking into account the recent label expansion in Alzheimer's disease agitation, the clinical profile in this indication, the health and the trajectory of the MDD business and recent investments in our sales infrastructure, we are now able to update our peak sales outlook for the product. We now believe AUVELITY has the potential to generate at least $8 billion in annual revenue at peak, with approximately equal contribution from each indication. Over the extended life of the product, we see a clear path to achieving this growth potential, supported by the underlying fundamentals of the business as we continue to scale.

Turning now to SYMBRAVO. More than 17,000 total prescriptions were written in the quarter, representing 36% growth versus Q4 2025. More than 5,000 new patients started SYMBRAVO treatment in the quarter. Neurology specialists accounted for approximately 60% of total [indiscernible] in the quarter with primary care representing approximately 32%, an increase from 20% in the first quarter of launch. While headache specialists will remain a critical prescriber segment for SYMBRAVO, the increase in primary care prescribing is an encouraging signal of SYMBRAVO's potential, and reinforces the early experience with SYMBRAVO as a safe and tolerable acute migraine treatment that provides fast migraine pain improvement sustained through 24 and 48 hours.

Based on SYMBRAVO's growth within its launch year, increasing demand for education of the only branded multi-mechanistic acute migraine treatment in the market, we are increasing the SYMBRAVO sales team by approximately 50 representatives. Our expanded SYMBRAVO sales force of 150 representatives will support broader reach in the primary care market while deepening engagement with headache specialists and neurologists throughout the country. We are also pleased to announce a major commercial payer contract for SYMBRAVO effective this month, securing coverage for approximately 17 million lives. The agreement reflects SYMBRAVO's compelling clinical profile and its potential to address the needs of patients with inadequate response to [indiscernible]. Overall payer coverage for SYMBRAVO is approximately 57% representing 56% in the commercial channel and 57% in government channels. We expect coverage for SYMBRAVO to expand and evolve throughout 2026.

And finally, in Q1, approximately 54,000 SUNOSI prescriptions were written, representing 16% year-over-year growth and a 3% decline sequentially. By comparison, the wake-promoting agent market grew 1% year-over-year and declined by 5% versus Q4 of 2025. Nearly 500 new clinicians prescribed SUNOSI in the quarter, bringing the total cumulative prescriber base to more than 16,500 since launch. Payer coverage for SUNOSI remained steady at approximately 83% of lives covered across channels.

Overall, the first quarter of 2026 was marked by significant progress across Axsome's Commercial business, including strong demand for our products, key advancements in market access, launch preparations for AUVELITY in Alzheimer's disease agitation and disciplined organizational growth designed to maximize the potential of our singular CNS portfolio. Looking ahead, Axsome is well positioned to deliver on our commercial objectives across our innovative portfolio through the balance of the year. We look forward to sharing our continued progress with you over the coming months. I will now turn the call back to Herriot to discuss our singular CNS pipeline.

Thank you, Ari. I will now touch on reason developments and upcoming milestones for the rest of our pipeline. Starting with AXS-12, as I mentioned, we recently submitted our NDA for AXS-12 for the treatment of cataplexy in patients with narcolepsy. Narcolepsy is a rare and debilitating neurological condition that affects approximately 185,000 people in the U.S. We are excited by potential of AXS-12 to provide a new and differentiated treatment option to patients living with narcolepsy. We look forward to announcing the FDA's decision on the acceptance of the filing.

Beyond AXS-12 in Narcolepsy, we are also developing the full suite of clinical programs in our leading neuroscience pipeline. Starting with AXS-05, we are on track to initiate a pivotal Phase II/III trial in smoking cessation, this quarter.

Moving on to Solriamfetol. Our Phase III programs for the molecule continue to progress. These include ADHD, Binge eating disorde, MDD with symptoms of excessive daytime sleepiness and excessive sleepiness in shift work disorder. For ADHD, we are on track to initiate 2 pediatric Phase III trials, 1 in children and 1 in adolescence of this quarter. For MDD, we recently initiated the CLARITY study a Phase III, double-blind, placebo-controlled randomized withdrawal trial. In the trial, patients who achieved a sustained response during the open-label period will be randomized to continue solriamfetol or switch to placebo. The primary end-point of that trial is time to relapse with depressive symptoms.

For Binge-eating disorder, our ENGAGE Phase III double-blind randomized controlled trial is progressing, and we anticipate top line results in the second half of this year.

Finally, for Shift Work Disorder, the Phase III trial continues to enroll with top line results anticipated in 2027.

Turning now to AXS-14, our novel, highly selective and potent norepinephrine reuptake inhibitor for fibromyalgia. Enrollment is ongoing in the FORWARD Phase III trial. We look forward to sharing updates on this program as the study progresses. OFS 17, our novel oral selective GABAA-pen for epilepsy, pep-transfer and Phase II trial enabling activities are well underway.

Lastly, we recently acquired AXS-20, or balipodect, a potentially first-in-class oral potent selective PDE10A inhibitor. We plan to develop AXS-20 for the treatment of Schizophrenia and for Tourette syndrome. We plan to initiate Phase III trial enabling activities for AXS-20 in Schizophrenia later this year.

I will now turn the call back to Ashley for Q&A.

Thank you, Herriot. Operator, please open the line for Q&A.

[Operator Instructions] Our first question today is coming from Ash Verma, from UBS.

Congratulations again on all the progress. So I know it was the second day of Q&A. But maybe just on ADA, are you thinking about the LTC market in the long run? I mean, clearly, right now, 40% of these patients reside in LTC but the current prescriber mix is really PCP. But when you think about the long run, how much of -- for this -- for you to completely extract value out of this market? How much of a focus does LTC need to become in the long run?

Thanks for question this is, Ari. Our sales team of approximately 630 representatives, we'll call them both community and long-term care facilities. And so for us, it's important to be present and to educate prescribers and care partners within both facilities or both settings of care. Ultimately, it's a concentrated market that allows for efficient promotional activities. And we expect that it will go over time as the brand ramps.

But we believe the community and long-term care are both very important for this market and look forward to sharing some updates as we get going with the launch.

Got it. And can I ask a quick follow-up? So just on the ADA indication, I know that you're using this unique 30 mg dextromethorphan dose in the titration pack, which you haven't used for this launch. Is this supplied in the channels already? Or does this, in any way, become like a bottleneck for the whole launch at this point?

As a reminder, we'll be launching next month. And Ari touched on the items that that are being finalized right now for a launch. Do you want to recap those again, Ari?

Yes. I mean we're finalizing our sales and marketing resources and training our sales force on the new indication. The titration dose will be available at the time of commercial launch.

Next question is coming from Marc Goodman from Leerink.

Those are pretty big peak sales numbers. Can you help us just understand like why did you feel like you had to raise them today? And second, you just talk about what went into the forecasting there and $4 billion in each indication?

Thanks, Marc. While the FDA approval of AUVELITY and Alzheimer's disease agitation provides greater certainty regarding the long-term sales potential of the product, and as you know, Alzheimer's disease is a large and growing market, 7 million patients, of which 76% are impacted by agitation symptoms. And of course, there are only 2 approved agents on the market. So when we review our proprietary market research on HCP perceptions, potential use of the product, taken together with the clarity around the final label, it really provides confidence that AUVELITY will be used as a frontline treatment in Alzheimer's agitation and we've seen growing uses frontline treatment and MDD.

Our -- the foundation of market access that we built, along with growing adoption in primary care, which, of course, is a critical provider segment in the Alzheimer's space. I think these things taken together with our MDD penetration and growth trajectory and the increased sales force to support both indications give us confidence in the potential to achieve our updated peak sales estimate for AUVELITY.

Next question is coming from Andrew Tsai from Jefferies.

I have a bigger picture question, now with AUVELITY approved in Alzheimer's agitation, how does that embolden you guys to pursue even more indications, I'd imagine you can directly go to Phase III with AUVELITY for other indications? And this drug has a long tail, too. So maybe talk about when you might learn more about indication expansion of opportunities? Or is that it with AUVELITY?

Andrew, the -- we did touch on the next indication that we've been working on for some of that smoking cessation. So stay tuned for updates there. And the next step with that program is initiating the Phase II/III pivotal trial. So we'll have updates there soon. And the product is very interesting given the -- that it targets MDA and sigma-1 receptors, high potential applicability to other neuropsychiatric conditions and that's something that the team is obviously exploring. But right now, next formal step is moving to smoking cessation trial initiation.

Great. And then as a follow-up, with your new PDE10 asset that's starting Phase III-enabling studies this year, can you talk about the efficacy safety profile why it did not necessarily hit [indiscernible] in Phase II and why you think you can produce a different outcome in Phase III and correct me if I'm wrong, but I think schizophrenia studies could be relatively fast. So could it be possible we get data maybe 2028?

Sure. Thanks for the question on balipodect. With regards to the efficacy, there was a Phase II trial, which you mentioned, which was done in schizophrenia. This was a randomized double-line [ theme-controlled ] trial. And the -- when we looked at the data there was clear separation, the magnitude of treatment effect, for balipodect was on the high end when you look at historical treatments for schizophrenia. Now because of the size of the study, obviously, it was not powered for statistical significance. But despite that, there was a very clear trend, and there was statistical significance on various measures, including, for example, global measures. So clinicians were able to see, the highly significant improvements in schizophrenia, and there were also on other measures, which were positive.

For example, the rates of discontinuations due to lack of efficacy, a wide gap with half of patients who weren't placebo discontinued the lack of efficacy versus in the low double digits for balipodect. So clearly, there was a very strong signal there. And when you look at the safety profile, it is very distinct, obviously, from [indiscernible].

So very excited about this potentially first-in-class treatment. And as it relates to timing of starting a Phase III trial, this is a Phase III-ready asset. What we need to do is to restart manufacturing of clinical supplies. So the Phase III enabling activities are ongoing this year, and we would anticipate, we are targeting potentially starting a Phase III trial around the end of the year.

Next question is coming from Ami Fadia from Needham & Company.

Firstly, on SYMBRAVO, can you give us some more details around where you're seeing utilization and how you see the drug evolves with sort of this expanding payer coverage? How do you see the evolution of gross to net and also utilization as the year progresses?

And then with regards to AUVELITY, just to follow-up to a previous comment. You think about the IP runway you have. How are you thinking about sort of really expanding the number of engagements where you explore this product ahead of the IP runway and the IRA. So could we expect to see you look at multiple other indications? Or will it be sort of more sequential?

Thanks, Ami. I'll start with the SYMBRAVO question. We've been really pleased that SYMBRAVO has found its way into the treatment paradigm for many headache specialists, and what we're seeing is approximately 60% of uses in the first and second line setting. The feedback that we get from HCPs is that SYMBRAVO has been particularly effective for patients with inadequate or partial response to triptanes, and we expect those patients to be the primary focus moving forward.

Obviously, the market access win that we're announcing today is an important step for long-term patient access. We think it will have a positive impact on GTN in the future. But the focus of the team is to continue to expand access for patients, which will help to drive reductions in GTN over time. But for the short term, we expect to continue to be elevated as we build our access.

Great. And as it relates to the question on new indications or additional indications for AUVELITY, given the IP runway, you are correct. We're in a very favorable position given that there is a very long exclusivity runway for AUVELITY and also the fact that the product is commercialized, we are not resource constrained as it relates to potentially developing for other indications. The other interesting thing about the product, which Mark touched upon is that it's unique pharmacology which is applicable to a number of potential CNS indications. So we have very clear ideas as you can imagine, internally, around what these additional indications are. And we want to make sure that we move in a very measured way. And if there is something that is worth doing, we think it's worth doing quickly. And so stay tuned as it relates to other potential indications, which could further increase the value of the product long term.

Next question is coming from Jason Gerberry from Bank of America.

Another follow-up question on the PDE10, my understanding was that I think Axsome and acquiring this asset plan to push dose relative to what was studied by Takeda to get their receptor occupancy. So wondering if you can speak to that dynamic, how high you'd be looking to push dose and confidence that the support of data, give you a safe dose strength to interrogate?

And then as my follow-up, are there any signs or indications that antipsychotic use in nursing homes is coming down at all in the wake of the March OIG report that was dubbed, I think, inappropriate use of antipsychotics in nursing homes. So just curious if you have any insights as you [indiscernible] for your own ADA launch?

Yes. Thanks for the question. With regards to the PDE10 inhibitor, we have not discussed dosing that relates to the product. However, the dose that was studied was effective, had the number of subjects per arm than what you would have -- what you would have seen in the [indiscernible] Phase III trial in schizophrenia. Clearly, it would have reached statistical significance.

Yes. And regarding your question on antipsychotic use, there hasn't been an immediate drop in antipsychotics in an overall substantial way. I think the news is still relatively new. But what I will say is that the awareness of that report and the sensitivity on using antipsychotics with this patient population is very high among providers and family members. So we think that provides a good foundation for the AUVELITY launch in the Alzheimer's disease agitation space, and expect there to be continued focus on antipsychotic use moving forward.

Our next question today is coming from Ram Selvaraju from H.C Wainwright.

Firstly, on the commercial side, I was wondering if you could provide us with some additional details regarding the deployment of the field sales force the degree to which sales reps currently promote more than 1 product or are dedicated to promoting a single product within your commercial product range and how you expect this to evolve going forward? In other words, to what extent do you expect to deploy sales representatives dedicated to a specific product in a specific indication versus having them promote more than 1 product at a time and to what extent this strategy will be reflected going forward in the deployment of the commercial sales force?

And then with respect to clinical development directions, I was wondering if you could comment generally perhaps on your interest in muscarinic receptor modulation, particularly as this pertains to both the neuropsychiatric and cognitive dysfunction dementia fields. And if you could also give us a sense with respect to balipodect, where you expect the specific safety advantages of this product to lie within the neuropsychiatric indications that you expect to target?

Yes, I'll start with the deployment of sales force question. So up to this point, we largely had our sales teams focused on one specific brand. Part of that is related to the unique specialist audiences that are particularly important in the launch phase. And so for AUVELITY that's psychiatry, for SYMBRAVO headache specialists and neurologists and for SUNOSI, sleep specialists.

With the Alzheimer's agitation launch, because of the high degree of overlap, in call points for MDD and ADA. That team will be supporting and promoting both indications. But in terms of long-term potential or vision for the team, as you know, our portfolio on our pipeline is unique in that there are many shared call points for certain therapeutic areas. And so that's something we'll continue to evaluate, and we'll share as we make some progress moving forward.

Great. As it relates to the pipeline questions with regards to your question on muscarinic receptor modulation, that mechanism of action does not fall into our current pipeline, so we don't have much to add there. And as it relates to balipodect and the potential safety advantages, just as a reminder, this is a PDE10A-inhibitor. And so it works by regulating cyclic-AMP and cyclic-GMP levels, downstream from D1 and D2 receptors. So the potential safety advantage and this has been shown in preclinical studies as well as in clinical studies is one of the advantages is that what has not been seen or changes in the glucose levels of prolactin levels.

So as you know, with ease of antipsychotics, one of the major side effects has to do with metabolic side effects. And so we have seen preclinically as well as clinically that this could be a major benefit with cAMP and balipodect.

Next question is coming from David Amsellem from Piper Sandler.

So just two for me. With the significant expansion of the commercial infrastructure, what's your appetite for the acquisition of a market-ready or commercial stage asset? I know you focused on expanding the pipeline, but you have a lot of infrastructure now that you can leverage. So maybe talk to that?

And then secondly, a question on [ reboxetine ], and how you're thinking about the underlying commercial opportunity in the landscape where you're going to have Orexin-2 receptor agonist as options in this population?

In terms of being able to acquire a marketed product, we have done that in the past, and we did that with SUNOSI, which was our first acquisition. Having said that, we have such a rich portfolio marketed assets, new indications and also a very late-stage pipeline that we have enough to focus on to drive longer and as well as the near-term value. So short-term and near-term value inflections and long-term sustainable value creation.

With regards to the Orexin-2 agonist, so if you look at narcolepsy, this is an orphan indication, but a large one 185,000 patients, and what we see is that there's a lot of heterogeneity in this patient population. There's a lot of polypharmacy, not every drug works. Also, there is a lot of side effect liability with the current treatments. And each treatment will have a different side effect profiles. So -- the -- what we like about our product, about AXS-12, a couple of things.

One, it works very quickly. So we have an onset of action, which is at 1 week. And currently, all the other products on the market take a lot longer about 1 month to work. Secondly, the efficacy that we've seen is durable. So we have data up to 6 months, and all of that efficacy comes with a very favorable side effect profile and a first-in-class mechanism of action for narcolepsy.

Lastly, with regards to some of the other ancillary symptoms of narcolepsy. The data does show that AXS-12 has the potential to also beneficially affect EBS as well as cognition. So we're very excited by the potential to provide a new treatment option to patients.

Our next question today is coming from Yatin Suneja from Guggenheim Partners.

Congrats on all the success and progress. Just a question on ADA. Actually, two questions. One is how should we think about sort of guidance at what point you think you might be able to establish guidance if that's even possible?

Two, if we we're all trying to model the ADA RAM curve. Obviously, when you launch AUVELITY in MDD, I think awareness was not there. So how much more -- like how should we think about the early launch in MDD? And how do we sort of model it for ADA? Any guidance there would be really helpful.

Sure. Jatin, this is Nick, as it relates to guidance, first of all, we gave guidance, right? We have peak sales guidance out there of at least $8 billion for AUVELITY, $300 million to $500 million for SUNOSI and $500 million to $1 billion for SYMBRAVO. So that's our peak peak sales guidance.

And obviously, a lot of fluidity now with the expansion, with the approval, with market access continuing to grow and evolve. So at this point, there's just -- there's many variables out there from a short-term perspective. So we want to see how they evolve, and then we can take a look at potential guidance down the road.

And regarding the ADA ramp, obviously, it's very challenging to predict exactly how any launch will ramp over time. As you mentioned, the AUVELITY in MDD, on one hand, is an [indiscernible] even though a different marketplace and same product and obviously, we're optimistic because there's greater awareness, better market access, a larger sales team. On the other hand, there's one analog in this market with Rexulti. And although the clinical profiles are very different, it does give some sense of uptake in the settings of care, which we'll be entering. So I think we'll learn more as we get into the launch, and we'll be able to share those details of what we're observing.

Next question is coming from Sean Laaman from Morgan Stanley.

AXS-12, I'm just wondering what is sort of price and payer discussions, if any, have been like? And what's the kind of investment you think you need to make to ensure that this drug has a success given there is such hot debate on the Orexin-2 agonist and the large market potential there.

Yes. Thanks, Sean, for the question. Obviously, we've been engaged with payers on early education around the clinical trial programs in the data, we have not specifically engaged in pricing discussions. So I'll have to defer to a later time to share some of those details. But there is genuine interest in new narcolepsy products for the reasons Herriot stated earlier, which is that -- there's significant inadequate response, treatment switching and polypharmacy. And so payers are very mindful of ensuring that treatment options that are available have strong efficacy, safety, and tolerability.

In terms of the investment required, we'll have more to share as we get closer to a potential approval. But as we've mentioned previously, we have established a sleep team for SUNOSI that is in market today. And obviously, there is a near perfect overlap in terms of ACV targets for SUNOSI and AXS-12, if approved.

Yes. Maybe just a little bit further on to Ari's comments from a financial perspective, you would consider -- you would think of orphan drug pricing. From top line, as Ari shared, we already have the infrastructure set up with the sleep team, and the marketing team from sleep. So what we would anticipate that a lot of synergies with AXS-12 in the current infrastructure and improving -- continuing to improve the operating leverage within the P&L.

How excited are you about that product? It doesn't seem to get a whole heap of airplay amongst the investor discussions. So how excited are you about it?

Very excited. We are very excited. The feedback we're getting from KOLs and early market research is is really strong. And because these patients are very difficult to treat and are frankly dissatisfied with existing treatment options. We believe there will be significant room for AXS-12 to make a significant impact in this marketplace.

Next question today is coming from David Hoang from Deutsche Bank.

Congrats on all the recent progress. So first, I wanted to come back to the peak sales number they you put out there for AUVELITY. If I heard you correctly, I think you said 50-50 for the MDD versus ADA indications. And so the MDD number strikes me as a large one, and I'm just wondering if you look at other kind of other antidepressants or comparable products in the market to help you get to that number?

And then maybe a follow-up there is, does that contemplate evolving competition in the field over the next few years, let's say? And for example, do you see psychodelic therapies as competitors to AUVELITY?

Yes. Thanks, David. I think, obviously, we're -- we take a look at market analogs, but they don't fully drive our decisions, which is largely based on our internal research and analysis. And what we're seeing in terms of adoption rates, penetration, the improvements in our commercial infrastructure related to sales force and market access and now the additional data in Alzheimer's disease agitation. In some ways, AUVELITY stands on its own in this marketplace because of its novelty in terms of mechanism of action as well as the clinical profile that it delivers when compared to other treatment options. And so we're confident in the potential that we shared earlier today, and look forward to sharing some additional updates as we grow the brand, particularly as we get into the Alzheimer's disease agitation launch, which is a really important milestone for the brand.

Next question is coming from Myles Minter from William Blair.

Congrats on the quarter. First of all just on the ENGAGE study of solriamfetol and Binge-eating disorder. How are you thinking about what you'd like to see from an efficacy standpoint there? Should we be looking at the [indiscernible] data set of about 1.5-day reduction in binge-eating days over that weak period, so that it will be about 18 to 20 days over your 12 weeks in ENGAGE. That's the first one.

And then on AXS-14, very curious as to the randomized withdrawal nature of the trial that you're conducting in fibromyalgia, that seems great from a probability success standpoint. Just reading some recent guidance from the FDA, I think that they make statement that it's not necessarily a robust comparative from the safety aspects of that drug. Was there any sort of conversations that you're already over the hurdle per se on the safety data requirements for AXS-14 with the previous data from Pfizer that you don't have to do any additional studies beyond this one?

Thanks for the questions. As it relates to the Binge-eating disorder study, it's hard to say what we're looking for. Obviously, we powered the study to detect a treatment difference. One of the limitations of making predictions is that currently, there's only one product that's approved. So not very many studies have been done, in binge-eating disorders. So that's exciting. And we look forward to the data readout to see what we see. Obviously, what we're looking for is a positive study. So we're looking for a statistically significant improvement with our drug versus placebo.

As it relates to AXS-14, we are very excited about the clinical trial, which we've launched. With regards to the safety data, just as a reminder, 2 randomized double-blind placebo controlled trials have been conducted. And both of those were positive. These were very large studies. And also, there were 2 long-term safety trials with hundreds of patients treated out to at least a year. So plenty of randomized as well as the long-term safety data with AXS-14.

The next question is coming from Matthew Hershenhorn from Oppenheimer.

Congrats again on the ADA approval. We were wondering just about your overall BD strategy following the recent deals for AXS-17 and balipodect especially in terms of additional capacity and other areas you'd like to add to. Do you consider psychedelics or neuroplastigens as a potential complement to your psychiatry portfolio? And if the recent policy and regulatory dynamics as well as some strategic interest for those inform your thinking there at all? I really appreciate it.

Thanks for the question. We don't, as you know, comment specifically on the business development. But what we can share is that we think very carefully and we're very selective as to what we add. Now we don't really need to add anything anymore. We have the pipeline right now, which is very deep and very broad and late stage. And so we did announced at least 2 recent business development transactions, which provide us 2 new NCEs with novel first-in-class mechanisms of actions. And then that complements on the rest of our pipeline. So we've demonstrated our ability to generate what we believe will be an inflection in the base business already. And then also, we are ensuring that that inflection will be sustained with the current pipeline that we have.

Next question is coming from Ben Burnett from Wells Fargo.

I want to ask just a question about the CLARITY solriamfetol study. Is that -- so to randomize withdrawal study, maybe give a little color as to why that design was chosen? And I guess if it's positive, would you expect to have to do a parallel study after that?

Thanks for the question. So we do anticipate that we would need 2 positive trials. That's the standard for any approval from any indication at the FDA, and in terms of the reason for the randomized [indiscernible] design, one of the challenges with neuropsychiatric indications and depression in particular is by dosing response. So how do you deal with that? So in the prior studies in the prior study, which we conducted with solriamfetol in this indication. What we saw in the active arm was clearly a very renounced antidepressive effect. So -- what we wanted to make sure is that we're able to tease out and really demonstrate that this is a drug effect. And while minimizing the impact of the placebo response. So that's the rationale behind the selection of that study design.

Okay. And can I also ask just like long term, how are you thinking about profitability? And does the increased conviction in AUVELITY and what that could do from a sales perspective? Does -- I guess does profitability start to become a goal for the company? Or is the focus kind of more on sort of revenue growth?

Right now, our focus continues to be on revenue growth. So I think if you have to put things in priority order, revenue growth is number one. Then getting the cash flow positivity is two, and then profitability shortly thereafter.

Our next question is coming from Greg Suvannavejh from Mizhuo.

Congrats on all of the progress and especially the ADA agitation approval. I've got questions on AUVELITY, and I'm curious if you could provide some color around how we should think about this year's quarterly sequential growth given seasonality dynamics given that while ability is still growing year-over-year in MDD. As you get to bigger numbers, it starts slowing down, but then you've got the ADA launch. So I guess do you anticipate year-over-year growth in 2026 be perhaps bigger than you saw in 2025?

And then just a follow-up on AUVELITY, just given ADA approval. Can you tell us how you're thinking about IRA implications and how we should think about as you add more Medicare patients, how we should think about including that in our models or not in terms of any impact there?

I'll start with the first question around quarterly sequencing. We haven't guided specifically on sales ramp over the course of the year. But as you know, Q1 is a quarter in which market seasonality comes into effect. But we believe it's transitory in nature, as evidenced by the early demand trends that we're seeing in Q2.

And then maybe just a little bit on the IRA, Greg. At the earliest IRA negotiations will not impact AUVELITY until 2031. Obviously, assuming Ability meets the requirements for negotiation of being a top spin Part D product. And it is important to note that the $8 billion that we shared today contemplates any type of IRA impact.

The next question is coming from Brian Skorney from Baird.

This is Charlie on for Brian. So just kind of following up on an earlier question, Curious how you're thinking about positioning SUNOSI ahead of potential Orexin agonist launch later this year as well as with your expansion of the sales force there and wrapping up the expansion of the Auvelity sales force, how should we think about kind of the ramp of SG&A spend throughout 2026?

Maybe I'll take the SG&A question first. So SG&A increased this quarter. Primarily for four reasons. First off, we typically do see a bit of phasing of higher spend in SG&A in Q1 versus the rest of the year just on the underlying business. Secondly, we accelerated the marketing spend in preparation of approval of ADA to make sure that the infrastructure was established and ready to launch in June. So we're moving along there very nicely. Thirdly, the field force expansion was actually faster than we anticipated. So we're pleased with with where we are in preparation for a June launch. And fourth, we actually continue to have DTC spend for AUVELITY in MDD. So as we think about the rest of the year, we would anticipate SG&A will likely increase in Q2, but at a slower rate than what we've seen from Q4 to Q1 and likely level out shortly thereafter. But it's -- importantly, it's we should note that we expect to see continued operating leverage in the P&L as top line revenue growth is anticipated to outpace the growth that we expect to see in operating expenses.

Yes. And regarding your question on AXS-12. Obviously, it's a great time for treatment developments in the narcolepsy space and we're very excited about the potential for AXS-12 to enter this marketplace, without sharing specifics around the Orexin, I would just say that we're very pleased with the Phase III clinical trial results. Herriot mentioned earlier, significant reduction in weekly cataplexy attacks, as early as week 1, very safe and tolerable [indiscernible] benefits across a variety of secondary end points including excessive daytime sleepiness and cognition. So we think there's a real opportunity for AXS-12 to make a difference for patients, and we'll look forward to news regarding the submission.

Next question today is coming from Madison El-Saadi from B. Riley Securities.

Congrats on progress. A couple related to AUVELITY. Our understanding is that long-term care formulary additions or gated by these quarterly reviews that facilities have. And so just given everything we know in terms of payer coverage, sales force expansion, the general profile of the landscape Curious if there could be a bolus of ADA agitation patients? And then just as a follow-up, I guess, over the next, say, call it, 12 months, how many prescribers do you expect may prescribe ability for both depression and for AD agitation?

Yes. Thanks for the question, Madison. Regarding LTC bolus, I think it's difficult to predict exactly, but our team has been actively engaged with payers and LTC organizations to ensure patient access for AUVELITY. So we'll have more to share once we get into the commercial launch.

And in terms of MDD and ADA prescribing, I think it's important to note, and I think we shared this on our call last Friday, that we'll be calling on roughly 68,000 HCPs with our expanded sales team, and approximately half of those targets are considered high-volume treaters of both Alzheimer's disease agitation and major depressive disorder. So I think that gives you some sense of the potential for ability to be used across both indications within a single prescriber or clinicians practice.

Next question is coming from Rudy Li from Wolfe Research.

Just a quick follow-up to your long-term guidance of ADA in AUVELITY sales. How should we think about the uptake maybe for the relatively near term, maybe in the next 2, 3 years, just additional color like on your key assumptions and what's going to give you confidence with the trajectory to ADA peak sales?

And secondly, just can you talk about your OUS development plan for AUVELITY, since now we already secured 2 indications in the U. S.

Yes, and thanks for the question. When you think about uptake in the next 2 to 3 years, obviously, there will be a lot to learn over the next several months as we see our expanded sales force in the market for both indications. And obviously, Alzheimer's agitation indication will be new since we launch, and so it's hard to share specifics on what we expect the uptake to be, but we have seen strong growth in new patient starts and new rider activation, within NDV, which we expect to continue, and there will be another increase relative to the Alzheimer's agitation market, which share some common targets with MDD, but there are some distinct targets that we're adding to the call plan for this year. So I think we'll have more to share as we get into the Alzheimer's agitation launch, but -- the update to the peak sales estimate was guided by our internal analysis and ultimately the final label for agitation, which gives us confidence that in both indications, it will be increasing first frontline use of the product.

As it relates to OUS, our primary focus is on executing a launch in ADA and successful commercialization in the U.S. while identifying the ideal partner ex U.S. So as we said in the past, our plans, our partner ex U.S. and our primary focus is to ensure that we find a partner that shares our vision for the drug in its future.

We reached the end of our question-and-answer session. I'd like to turn the floor back over for any further closing comments.

Thank you, operator. Axsome today represents a singular CNS platform. with our differentiated marketed products and a broad pipeline of potentially first-in-class and best-in-class treatments targeting unmet medical needs in psychiatry and neurology we are well positioned to deliver substantial long-term value for patients and shareholders. We look forward to providing updates on our progress throughout the balance of the year. Thank you, everyone, for joining us this morning. Have a great day.

Thank you. That does conclude today's teleconference and webcast. You may disconnect your lines at this time, and have a wonderful day. We thank you for your participation today.

Good morning, and welcome to the Axsome Therapeutics conference call. [Operator Instructions] As a reminder, today's conference call is being recorded.

I would now like to turn the conference over to your host, Mark Jacobson, Chief Operating Officer of Axsome Therapeutics. Please go ahead.

Thank you, operator. Good morning. Thank you all for joining us on today's conference call to discuss the approval of Auvelity for the treatment of agitation associated with dementia due to Alzheimer's disease.

During today's call, we will be making certain forward-looking statements. These statements may include statements regarding, among other things, the efficacy, safety and intended utilization of our agents, our clinical and non-clinical plans, our plans to present or report additional data, the anticipated conduct and the source of future clinical trials, regulatory plans, future research and development plans, commercial plans and possible intended use of cash and investments. These forward-looking statements are based on current information, assumptions and expectations that are subject to change and involve risks and uncertainties that may cause actual results to differ materially from those contained in the forward-looking statements.

These risks and -- these and other risks are described in our periodic filings made with the Securities and Exchange Commission, including our quarterly and annual report. You are cautioned not to place undue reliance on these forward-looking statements, which are only made as of today's date, and the company disclaims any obligation to update such statements.

Joining me on call today from the Axsome team are Dr. Herriot Tabuteau, Chief Executive Officer; Ari Maizel, Chief Commercial Officer; Nick Pizzie, Chief Financial Officer; and Hunter Murdock, General Counsel. Also joining me on the call today is one of the leading experts on agitation in Alzheimer's disease dementia. Dr. Jeffrey Cummings, the Chambers-Grundy Professor of Brain Sciences at the UNLV Kirk Kerkorian School of Medicine. Herriot will start with opening remarks followed by Ari, who will provide an overview of our commercial plans. Dr. Cummings will then provide an overview of Alzheimer's disease agitation, treatment needs, and we'll then discuss the profile of Auvelity in the indication. We will then open the line for questions. Questions will be taken in the order they are received.

And with that, I am pleased to turn the call over to Herriot.

Thank you, Mark. Good morning, everyone. Since Axsome's founding, we have been on a mission to deliver and develop transformative medicines to improve brain health. And so today, we are very pleased to share that the FDA has approved Auvelity for the treatment of agitation associated with dementia due to Alzheimer's disease. Agitation is one of the most common and challenging aspects of care in Alzheimer's disease. And to date, treatment options have been limited. Auvelity is a first-in-class medicine with a distinct mechanism of action that provides an important new treating option for this debilitating and critically underserved condition.

This approval, therefore, marks an important milestone for the millions of patients living with Alzheimer's disease, their families and their caregivers. Alzheimer's disease agitation is the second indication for which Auvelity has received FDA Breakthrough Therapy designation and has been granted FDA priority review and approval. This underscores Axsome's pioneering work in neuroscience and our dedication to people living with serious brain health conditions. Next slide.

In Alzheimer's disease, a cascade of cellular events leads to synaptic loss in neuronal cell death. These events are thought to result in reductions in certain neurotransmitter systems, which in turn contribute to the cognitive and behavioral symptoms of Alzheimer's disease, including agitation. Auvelity targets the NMDA and sigma-1 receptors, which are believed to modulate neurotransmitter systems implicated in Alzheimer's disease. The exact mechanism of action of Auvelity in the treatment of agitation associated with dementia is unclear. Next slide.

Auvelity has a differentiated efficacy and safety profile. It is the only approved treatment for agitation associated with dementia due to Alzheimer's disease that has demonstrated substantial symptom improvement, which was shown to be sustained in the long-term trial over up to 6 months. In clinical trials with Alzheimer's disease, patients, it was well tolerated with a low discontinuation rate that is identical to placebo. Next slide.

We are pleased with the labeling for Auvelity in this new indication. Highlighted in yellow are the updates to the Auvelity label for the new indication of agitation associated with dementia due to Alzheimer's disease. Importantly, with this new indication, there is no new boxed warning. Next slide.

Turning now to the key efficacy data. The efficacy of Auvelity in the treatment of agitation associated with Alzheimer's disease was demonstrated in the ADVANCE-1 and ACCORD-2 trials. ADVANCE-1 was a 5-week parallel study. In ADVANCE-1, Auvelity met the primary endpoint by demonstrating statistically significantly greater improvement in agitation symptoms as measured by the Cohen-Mansfield Agitation Inventory or CMAI total score compared to placebo at week 5. Patients who received Auvelity experienced a 14.9 point reduction in the CMAI total score compared to an 11.6 point reduction for placebo. The improvement with Auvelity was numerically greater versus placebo starting at week 2, demonstrating early separation.

Additionally, a statistically significantly greater proportion of Auvelity patients were rated by clinicians as improved compared to placebo as assessed using the modified Alzheimer's Disease Cooperative Study-Clinical Global Impression of Change for agitation, a key secondary endpoint in the study.

Next slide. ACCORD-2 was a long-term, double-blind randomized withdrawal trial in which patients who were known responders to Auvelity were randomized in an up to 6-month double-blind phase to either continue treatment with Auvelity or switch to placebo. In ACCORD-2, the patients who continued treatment with Auvelity experienced a statistically significantly greater time to relapse of agitation symptoms measured by the CMAI than with the patients who switched to placebo.

In the study, treatment with Auvelity reduced the risk of relapse by 72% compared to placebo. Overall, the study showed that 28.6% of patients on placebo relapse compared to 8.4% of patients who received Auvelity. Taken together, these data demonstrate rapid and durable improvement in agitation symptoms in Alzheimer's disease dementia, supporting Auvelity's potential for timely and long-term symptom management.

With that, I'd like to turn the call over to Ari, who will review the commercial opportunity for Auvelity in Alzheimer's disease agitation and discuss our launch plans. Thanks a lot.

Thank you, Herriot, and good morning, everyone. Agitation in Alzheimer's disease dementia has represented a significant unmet medical need. Today, more than 5 million people in the U.S. have Alzheimer's disease agitation, a number which is projected to double in the coming decades. Approximately half of these patients are currently treated with pharmacotherapies, reflecting a significant unmet treatment need that has existed for decades with only one previously approved treatment that reached the market in 2023.

The treatment landscape is defined by variability in patient disease severity and access to specialists in certain geographic markets, which influences where patients are treated and what provider specialty is responsible for clinical decision-making. The majority of Alzheimer's disease agitation patients live with loved ones in the community and are generally considered to have more mild to moderate agitation symptoms. Conversely, nearly 4 out of 10 patients reside in long-term care facilities and are generally considered to have more moderate to severe agitation symptoms.

Treatment decisions are overwhelmingly made by primary care providers across the United States with psychiatry, neurology and geriatric specialists playing an important role in managing symptoms for many patients. Next slide.

Last year, Axsome conducted a survey in partnership with a leading polling and research survey firm receiving critical insight from 751 care partners, including spouses, children, grandchildren, family members and friends of Alzheimer's disease agitation patients. The goal of the survey was to learn more about the challenges of living with and managing agitation symptoms.

An overwhelming majority of 97% of care partner respondents stated that Alzheimer's disease agitation symptoms had a negative impact on their loved one's quality of life. Further, 96% of care partner respondents agree that their loved ones seem more like themselves when agitation is under control. Although non-pharmacologic interventions such as environmental changes are recommended as first-line treatment, their success is highly context dependent. This variability, combined with the burden, risk and quality of life impact associated with agitation symptoms underscores the urgent need for safe and effective treatment options to preserve quality of life for patients and care partners. Next slide.

Our comprehensive launch strategy is designed to reflect current prescribing patterns, addressing points of care across treatment settings in key prescriber segments. Our expanded sales team of approximately 630 representatives will engage a broad group of clinicians aligned with where these patients are treated today, including primary care providers, psychiatrists, neurologists and geriatric specialists who treat patients in both the community and long-term care settings.

Our target list includes approximately 68,000 health care professionals with substantial overlap from our existing Auvelity prescriber base in major depressive disorder, which we anticipate will further support adoption. We've spent the past year working closely with payers and PBMs to ensure access to Auvelity for Alzheimer's agitation patients. And we've enhanced our comprehensive patient services program, Auvelity OnMySide to facilitate education and support for patients and the caregiver community.

Payer coverage for Auvelity is strong at approximately 100% of lives covered in Medicare and Medicaid, which together represent nearly 90% of the expected payer mix in Alzheimer's disease agitation. In addition, approximately 78% of commercially insured lives have coverage for Auvelity. Overall, our commercial infrastructure positions us well to execute a strong and coordinated launch of Auvelity in Alzheimer's disease agitation. Next slide.

In summary, Axsome has taken a disciplined approach to launch readiness to support Auvelity's entry into the Alzheimer's disease agitation market. Our expanded sales team is well positioned to effectively educate across key prescriber segments and patient settings of care. Our strong foundation of insurance coverage and patient support services will facilitate patient access to Auvelity and support ongoing treatment experience.

Finally, we expect our launch preparations to be completed in approximately 1 month, with a full commercial launch planned in June. We're excited to bring this important new treatment option to the Alzheimer's disease dementia community, and we look forward to updating you on our progress in the weeks and months ahead.

I'd now like to hand the call over to Dr. Cummings.

Thank you. Thank you very much, Ari. It's great to be on the call today. This is a very rare event to be participating in the announcement of a successful drug development program in Alzheimer's disease. So I just couldn't be more pleased than I am today and to share some information about agitation. If I can have the next slide.

This just is a definition of agitation to make sure that we're all understanding what agitation encompasses. There are generally 3 areas: excessive motor activity, verbal aggression and physical aggression. These have been used in the IPA, the International Psychogeriatric Association definition of agitation in cognitive impairment. And you can see that excessive motor activity is things like pacing and rocking; verbal aggression, yelling and shouting; and physical aggression, things like resisting and pushing and kicking and scratching. You can imagine what family members go through when these are the behaviors that their loved one exhibits.

Agitation is present across the spectrum of Alzheimer's disease severity. So you see in the bottom part of the slide, 56% of mild patients, that would be a mini mental of above 20. 75% of moderate to severe patients. So that's -- this is a real target population. 75% of them exhibit periods of agitation. And 68% of patients with severe dementia that is mini mental less than 10 exhibit agitation.

So let's go on to the next slide, which is CMAI. This is the Cohen-Mansfield Agitation Inventory, and it is the approved regulatory instrument for measurement of agitation in clinical trials. And you see how well it maps on to the IPA definition. So there's the physically aggressive domain. You see spitting, physical aggression, scratching; physically nonaggressive things, these are like pacing, repetitious mannerisms; verbally aggressive like cursing and screaming; and verbally nonaggressive like complaining and negativism.

You can see on the right there that the scale is scored from never, 1, to several times per hour. You can imagine what those patients are like at a score of 7. Given the range of scores of 29, which is the lowest score one can have because there is no 0 on the scale. There's only one as the lowest or never rating on the 29 items, and it can go as high as 203 if one had a maximum score on all of the items. Next slide.

So agitation is among the most prevalent and distressing of neuropsychiatric symptoms of Alzheimer's disease. Ari emphasized this as well. It accelerates disease progression and a really great question is going to be, does Auvelity slow this accelerated decline. It will be an important research question. If agitation exaggerates functional decline, it leads to increased earlier institutionalization and increased fall in mortality risk. So there are very many negative consequences of agitation leading to the importance of treating this and controlling it as well as we can. It's certainly a significant burden to caregivers. Next slide.

Now this is an unmet need for Alzheimer's disease. Historically, the use is for typical and atypical antipsychotics, antidepressants, benzodiazepines and antiepileptics. Most of them have not been rigorously shown to be efficacious. There is one approved atypical antipsychotic, brexpiprazole for the treatment of agitation in dementia due to Alzheimer's disease. And about half of the treated patients are on more than one class of anti-agitation medication, suggesting the low rate of response.

Limitations to these off-label medications include sedation, extrapyramidal effects, falls, worsening of cognition, cardiovascular and cerebrovascular events. These are mainly associated with the atypical antipsychotics. There's a black box warning for increased mortality risk among elderly patients with dementia treated with atypicals and they have modest efficacy with it being rigorously shown only for brexpiprazole. If I could go on to the next slide.

I would just say this is my last slide that this is a huge unmet need, highly prevalent and very disabling in terms of the course of Alzheimer's disease and its impact on patients and caregivers. Auvelity has a unique mechanism of action. It is not an antipsychotic. It targets the NMDA and sigma-1 receptors that modulate glutamatergic pathways that are affected in Alzheimer's disease agitation.

The clinical results then support the use of Auvelity in agitation in Alzheimer's disease. There was a significant reduction in agitation. You saw that in the material that Ari presented was safe and well tolerated. One of the things I like about this data set is the convergence from CMAI and the global scale that was used, the ADCS-Clinical Global Impression of Change because we have two perspectives and they give you the same information, increasing the validity credibility of that result. The onset of action is rapid and sustained.

I'll stop there, Ari, and Mark and turn it back to you.

Great. Thank you, Dr. Cummings. And so what we'd like to do now is open the line for question. Now I'll pass it to the operator who will provide the instructions for how to get in the question queue, if that's of interest.

[Operator Instructions] Our first questions come from the line of Leonid Timashev with RBC Capital Markets.

First of all, congratulations on the approval here. So I want to ask on sort of how patients are actually treated in the real world. I guess, is treatment intermittent or as needed? Or do patients typically select a drug and then stay on the drug for multiple months or years? So I guess, ultimately, how should we think about how many prescriptions each patient is going to be getting per year and what the compliance might be like?

So maybe I can start with that.

Dr. Cummings, yes, please. Great. Great.

Great. Thank you. Yes, that's a really good question. And what we're -- this is not a PRN medication. I think that's very important. This is a medication that when patients become agitated, they tend to remain agitation prone over a period of about 3 years. So patients will not be treated for the entire course of their illness, but they will be treated for relatively long periods during the course of the illness.

Compliance is high because these patients are pretty impaired cognitively. The caregiver is administering the medication and the caregiver is experiencing, of course, very great distress from these symptoms. So they're motivated to keep the medication going. So when the threshold for treatment is passed, that -- then the patients will be treated with a pharmacologic medication. Families try not to use medication. We respect that. But most patients have intolerable levels of agitation. Most patients that we would define as agitation have intolerable levels. And so they're treated with medications and compliance will be good. It will be for a period of roughly 3 years.

Our next questions come from the line of Ami Fadia with Needham.

Congratulations on the approval. Maybe I can sort of ask about just the payer coverage here. Now MDD, which is the prior indication for Auvelity, it benefited from being the protected class status, which had sort of 100% support in the government channel. AD agitation does not enjoy the same protected class designation. So what is your expectation with regards to the prior authorization requirements in AD agitation, particularly given that the high volume of antipsychotics that are used off-label and they're obviously a lower cost. So maybe kind of just from a clinician standpoint, what is going to be the approach? And maybe from Axsome standpoint, what type of step edits do you anticipate there?

Thank you, Ami, for the question. As you mentioned, for the MDD indication, Auvelity was considered part of the protected class over the past year, we've been working closely with payers and PBMs to ensure that our access extends to the Alzheimer's disease agitation indication. And we are confident based on those discussions and the terms of our contract that the coverage I referenced in my opening comments 100% coverage across Medicare and Medicaid is applicable to both indications.

As it relates to utilization management, that's an area we've been very focused on in terms of launch preparation. And approximately 75% of agitation patients will not require prior authorization in order to receive Auvelity once prescribed. And that is currently active. So that's not something that's coming down the road. That's effective in January 2026. So that's sort of the state of coverage going into the launch.

Our next questions come from the line of Andrew Tsai with Jefferies.

This is John on for Andrew. Congrats on the approval. What a great achievement. So in our doctor work, it seems like psychiatrists who treat depression also treat all agitation patients. And so they're very aware of Auvelity given their experience with MDD. And given that Auvelity is so penetrated in the PCP community, who generally tend to avoid antipsychotics, and then now with the FDA posting about it being a non-antipsychotic, with all this awareness already, maybe just speak to why wouldn't this launch be fast and just kind of your expectations on the pace and speed that the launch can grow?

Yes. Thank you so much for the question, John. To your point, there's significant overlap in prescribers as it relates to MDD and Alzheimer's disease agitation. And that is the primary focus of our sales team is calling on those clinicians that see a high volume of both sets of patients. So we're very optimistic. I think the awareness of Auvelity in MDD certainly will support uptake in prescribers who have written over the past couple of years. There will be some clinicians who either don't have experience or are more predominantly Alzheimer's agitation treaters for which education and awareness will be really important in the coming months. So yes, we're excited about the potential here, and yes, we'll keep everyone updated on our progress as we get through the launch.

And then maybe one quick follow-up, if I can. I'm curious on the overall messaging for your sales reps. of maybe why Auvelity should be used over other treatments and how they'll be positioning Auvelity specifically? Will it be like a first-line drug for all agitation? And then maybe remind us if Auvelity is being used ahead of Rexulti in MDD in the first place.

Sure. And maybe Dr. Cummings, could you offer your perspective on Auvelity's potential place for potential prescribers or patients?

Absolutely. And I'll just say that this will evolve as we come to understand Auvelity better. But the way I think it will be positioned is as a first-line therapy for many patients with agitation in Alzheimer's disease because the box warning is a discouraging factor for the use of Rexulti. And Rexulti has a strong data set. I think it's an effective medication, but the box warning is important in terms of discouraging prescribers. So I think Auvelity is likely to be the first choice for prescribers. There's no medication which is going to work for every patient. And so there will be room for other drugs in the market. And I think Auvelity will do very well within the therapeutic landscape of this very large problem.

And John, the only thing I'd add is our insurance coverage and the contracts that we've negotiated will support first-line use for the majority of patients. So I think that is in line with Dr. Cummings' view on potential place of treatment.

Our next questions come from the line of Ash Verma with UBS.

Congrats on the approval. This is great. So I know it's early days, but what do you expect the average duration of therapy in Alzheimer's agitation as opposed to what it has been in MDD? Just trying to understand if Auvelity and Alzheimer's agitation would more likely be kind of like a first-line pass-through treatment before patients ultimately start to go to some of the other off-label D2 blockers like Seroquel, Zyprexa, or Rexulti for that matter. So yes, if you can comment on that, that would be great.

Dr. Cummings, I know you touched on this briefly. Is there anything you would add to your prior comments? And then maybe we can offer something to round it out.

Absolutely. So I appreciate the fact that you brought up the off-label prescribing because I think this represents a liability for physicians and it represents a liability for health care systems where most physicians were currently employed. So the presence of now 2 on-label treatments, I think, is going to increasingly move doctors and the systems away from the off-label use of risperidone and quetiapine that have been the standards for such a long period of time.

So I think we will see the market migrating towards approved medications, which I think is absolutely an appropriate thing. This is -- these are the drugs that we know about safety and efficacy. And Auvelity is going to be very well positioned within that migration to on-label prescribing, as I say, because I think the box warning has been a factor in terms of use of Rexulti.

And Ash, the only thing I would add is, obviously, we're going to have to wait and see as the market develops with Auvelity in market. But there's never been a product like Auvelity for this patient population. And as Dr. Cummings suggested, compliance generally is very high if the drug is successful at treating these symptoms. So we'll share more updates as it relates to duration of therapy as we get some experience in the marketplace.

Our next question has come from the line of David Amsellem with Piper Sandler.

So this is one for Dr. Cummings. So a number of your peers talk about off-label use of reuptake inhibitors, be it selective serotonin reuptake inhibitors or dual reuptake inhibitors of serotonin and norepinephrine. So we hear a lot about off-label use there. So really two questions. Do you think that there's still going to continue to be off-label use of the reuptake inhibitors, particularly upfront? And then what can you say about the portion of patients who don't respond adequately to reuptake inhibitors, just given that it seems to be there's a lot of off-label uses of those in addition to the off-label uses of the atypicals that you cited?

Yes, really great question and an informed question. There is a lot of use of the SSRIs, in particular, because of the citalopram in AD study. And that showed that there was a statistically significant reduction in agitation associated with the use of citalopram or prescribing of citalopram. And that was a very well conducted and influential study. However, it also used a dose of citalopram, which the FDA believed is too high, and there was a cardiac warning associated with the dose that was used in the citalopram study.

So it hasn't enjoyed as the kind of widespread use that it might have if we had greater confidence in the safety of the agent. So again, I think there will be a migration towards drugs that are approved and where the efficacy has been established to the comfort level of the FDA.

The other thing I would say about the SSRIs is not surprisingly, they tend to do best in patients who have concomitant mood symptoms, and they also have performed best in patients with lower levels of agitation as compared to higher levels of agitation as seen in the current trial. So I think people absolutely will continue to use those drugs. They're comfortable with their use because of their widespread prescribing in depression. But I think we will see the market migrating towards drugs that are shown to be efficacious for this indication and safe and approved. I think the approval is of tremendous importance to docs.

Our next questions come from the line of Ram Selvaraju with H.C. Wainwright.

So the first one is probably for both Dr. Cummings and Ari. If you look at Rexulti experience in the elderly Alzheimer's population, maybe comment on how long patients who get put on Rexulti for agitation stay on that drug and the principal reasons for discontinuation? And also what you anticipate are likely to be the principal advantages for Auvelity in prompting a physician decision in favor of that medication versus Rexulti?

And then I was just wondering if, Ari, you could provide us with some additional details on something you said in your prepared remarks about the target prescriber base and what percentage of that approximately is currently covered by the sales team effectively promoting Auvelity based on the original MDD label?

Dr. Cummings, would you like to start with the Rexulti experience question?

I will, and I have to say that I don't know the answer to that question. I'm not sure how long the patients have remained on the agent. And I'm not sure of why it was stopped when it was not renewed. I'll just say one thing about the Auvelity development program that I particularly like is the combination of the parallel double-blind design and then followed by the withdrawal, the randomized discontinuation design, because the randomized discontinuation shows this very high rate of relapse in the patients who are randomized to placebo compared to those who continue treatment with Auvelity.

So I think that's a powerful piece of information and useful both in the question you're asking, what is the persistence. And if people see the relapse, they're going to redo the prescription if they didn't do it automatically. And then there are some rules that nursing homes have to abide by, including periodic efforts to try to get patients off of psychotropic medications. And again, that's a provocation that I really don't like because you see in the data that patients will relapse when you do that.

So I think this is a more comprehensive data set that allows us to think more about the use of Auvelity in the market because we both have the acute effect in the parallel design, and we have the enduring effect in the randomized discontinuation design. I think it's a very useful complementary set of observations.

Yes. I would build on that and just say one of the unique aspects of our messaging is related to that clinical trial plan, our development program. What's unique is we're able to communicate the impact of Auvelity in both short- and long-term studies with strong rapid onset of action, durable efficacy out to 6 months for many patients and a highly safe and tolerable profile. No box warning associated with elderly patients. And overall, the feedback we've received is this is a very, very compelling clinical profile that we feel very good about.

Ram, your question about target HCP. So as I mentioned in my opening remarks, we'll be calling on approximately 68,000 health care providers across the community and long-term settings. Today, we call on roughly 80% of those targets for the MDD indication. So there is high overlap with the folks that we've been calling on over the past few years. Obviously, that provides some advantage in terms of awareness and relationships. And there is a group, about 20% of that group, 13,000 that are primarily high-volume Alzheimer's disease agitation providers who will be new for Axsome, but who we expect to engage with early in the launch.

Congrats again on this landmark approval.

Our next questions come from the line of Ben Burnett with Wells Fargo.

I'll say congrats as well. I had two questions. Just one, I wanted to go back to the question around sort of the payers. What are your expectations for gross to net as you add AD agitation patients to the mix long term?

Sure. Yes. This is Nick Ben. We would anticipate that GTN for this year will look similar to 2025, similar to how we shared previously. So looking at the phasing that we had in '25, very similar in 2026. Reminder that we were in the mid-50s for the first half of the year and the high 40s for the back half of the year. So with this approval in ADA, we don't anticipate to see much change in GTN this year. And longer term, what we've shared before and continue to share is that we will likely level out in the 50s range from a GTN from a longer-term perspective.

Okay. That's helpful. And then I just wanted to ask just regarding the label, there was some description about hyponatremia. And I think there's maybe some guidance about concomitant use of other serotonergic antidepressants. Just wondering if you could maybe offer some color on that.

Sure. That was one addition to the label. It was based on one case of hyponatremia in our entire clinical development program. So the FDA wanted to make sure that -- we think the FDA wanted to make sure that clinicians are aware of hyponatremia in the elderly patient population because even any kind of clinical setting with elderly patients, so you do tend to see higher rates of hyponatremia.

And I guess would a patient who's on a serotonergic antidepressant have to come off that? And is that -- I guess, how relevant is that to this population?

So our clinical studies that did not include concomitant dosing with other agents.

Our next questions come from the line of Jason Gerberry with Bank of America.

Congrats on the approval. So my question is for Medicare Part D patients who are not low-income subsidy, what is your expectation for average out-of-pocket costs -- and do you see that as a barrier for that group of patients? Do you think there's a differential level of uptake in non-low-income subsidy Part D versus low-income subsidy Part D? So given that Part D is such a big part of the ADA population, I wanted to hone in on this out-of-pocket cost issue just because it's come up with Rexulti as a barrier to uptake because the sponsor can't deflect those out-of-pocket costs.

Yes. Thanks for the question. I think it's important to note that the overwhelming majority of Alzheimer's disease agitation patients do qualify for low-income subsidies. In terms of predicting out-of-pocket, if it's not an LIS patient, that's difficult to forecast until we see what the patient mix is during the launch itself. So we'll likely have more to share as we get into the launch. But we have been very -- we've been very mindful of our contracts with Part D plans to try to minimize out-of-pocket as much as possible. Obviously, it won't be a perfect solution. But given the high proportion of LIS patients in this marketplace and the contracts that we've been able to secure, we feel optimistic that out-of-pocket will not be a tremendous barrier to use.

And if I could just follow up on that because my understanding was LIS was like 30% of Part D. Is what you're saying that that's wrong, it's a much bigger proportion of Part D?

Yes. It really depends on setting of care. I would say in the long-term care setting, it's likely a higher -- much higher proportion of lives. In the community setting, it may be closer to what you're referring to. However, you also do see commercial coverage being stronger in the community setting. So there are some different dynamics at play. But ultimately, our view is that out-of-pocket expenses will not be a significant barrier to initial trial.

Our next questions come from the line of Joseph Thome with TD Cowen.

Congrats. Maybe the first one for Dr. Cummings, what proportion of your patients under your care or at your center with Alzheimer's disease as say, agitation are actually on pharmacological treatment to manage their agitation? And do you expect this would expand with the availability of Auvelity? Or will patients be switching at all?

And then maybe second for the company, how will you be reporting information on how the launch is progressing? Is it going to be clear which scripts are coming from MDD versus Alzheimer's agitation? And just sort of how are you going to relay that information to the Street?

I'll jump into the first part of that question in terms of my own practice, I tend to see earlier patients who have less agitation, so maybe only about 20%, 25% of patients with very early disease have periods of agitation and only about half of them are actually treated pharmacologically because in the early part of the disease, the agitation tends not to be prolonged. So families just figure out ways to adjust to it.

On the other hand, on consulting in long-term care facilities and there, 60% or 70% of patients will have agitation and most of it, over 50% would require pharmacologic management because the non-pharmacologic strategies simply don't work in that population. You can't do music therapy and make that work or aroma therapy and make that work in severely impaired nursing home patients in my own experience. So I would say the prevalence of use is going to depend on the kind of practice that an individual has. But in patients in that moderate to severe stage of the illness, it is very common. And most of it, 2/3 of it will require pharmacologic management just as a kind of a rule of thumb.

Joe, this is Ari. I'll start with your question about reporting. As we're evaluating launch performance, clearly, NBRx growth, new patient start growth will be one of the most important aspects. We will also be looking at activation of new prescribers, particularly the prescribers that we'll be adding who are specifically treating high volumes of Alzheimer's disease agitation patients.

As it relates to looking at the proportion coming from either indication, as you know, with IQVIA and Symphony, they don't split out by indication, but we will be looking at claims data retroactively to estimate the proportion of lives that are coming from one indication or the other.

Last thing I'd mention is just our entry into the long-term care setting. Although we expect there to be demand for both Alzheimer's agitation and MDD in long-term care, we suspect that Alzheimer's agitation will be sort of the primary source of initial trial. And so monitoring uptake in the long-term care setting will provide a helpful view on how the launch is progressing.

Yes. And Joe, from a net sales and GTN perspective, we'll obviously just be providing one number for Auvelity in totality.

Our next questions come from the line of David Hoang with Deutsche Bank.

Congrats on the approval. Just a couple of questions here. Maybe first, could you talk a little bit about the threshold to initiate a patient on Auvelity? Just what would you be looking for? Just would it be cases, number of cases of agitation, particularly severe agitation episode, just anything of that nature? And then in terms of other drugs being developed for adjacent indications like Alzheimer's disease psychosis, there are a few there such as Cobenfy. Would you view those drugs as competitors? Or are they -- do you view them as operating in a different patient segment that has psychosis?

Well, maybe I'll jump in on that and others can fill in. Threshold is really dependent on the family to such a great extent because some families just -- the last thing they want to use is a drug, and they'll just go way out of their way to accommodate the agitation. And other families have very low thresholds. And so the discussion that you have with the family is to what extent is this impacting the life of the patient and your life and the life of the family. And what are the activities that can still be done, and are there still enjoyable things that the patient can embrace.

And so it's a negotiation with every patient. This is truly a personalized care. And most families are going to want treatment. Most families do not want to have to adjust their own lifestyles to accommodate a very agitated patient. You can just imagine if your wife or your mom or dad had any of the behaviors on that list of behaviors that we went over. So most patients who have agitation, which is occurring several times per week and reaches a modest level of severity are going to be treated pharmacologically. And that's sort of the threshold that you're working with is how frequent is it and how severe is it. And there's a relationship between those two. So that the patients who are agitation prone have it more often and they have it more severely. So that's the kind of discussion that you have.

In terms of adjacent medications, I think that's a really interesting question. The Cobenfy program is proceeding, and I think will read out this year. Psychosis does overlap with agitation. There are psychosis patients who become agitated. And I think there will be a very interesting learning period here that we're all coming into as to whether or not the prescriber would say, well, I think I should treat the psychosis or I should try to treat the agitation. And I would say, at this point, we don't -- haven't figured that out. It's going to take professional guidelines to give some guidance to clinicians around those kinds of issues if Cobenfy is approved. And I think it's going to be a really interesting evolution as we get more drugs that bear on this kind of issue.

Our next question comes from the line of Rudy Li with Wolfe Research.

Congrats on the approval. Maybe a question for Dr. Cummings. He actually talked about the overlap of agitation and psychosis in Alzheimer's in your patients. Just wondering how that will impact the treatment sequencing and maybe medication selection while managing behavioral symptoms.

And then just a quick question for Ari, maybe you can talk about Rexulti dynamics since has been on the market for 3 years, also approved for MDD plus ADA. So what are the key learnings that you can apply for Auvelity?

So I'll pick up the psychosis question. We touched on that a little bit. One of the things that we need to do with the current Auvelity data set is to look at psychosis. And I understand that it was either excluded or occurred at a very low level at baseline, but we can look at whether there was greater evolution of -- or emergence of psychosis in the treated patients or in the placebo group patients to see whether there are any benefits of the use of Auvelity in this population in terms of psychotic symptomatology. I think there might be because this glutamatergic pathway is implicated in psychosis.

And then in terms of sequencing, again, I don't think we know that yet. I think the prominence of the symptom complex will be very important. If the patient is very paranoid, very disturbed by the thought that people are stealing from them, that patient is likely to be treated first with an antipsychotic. On the other hand, if the major problem is the list of problems that we saw on the CMAI or in the IPA definition, those patients are going to be treated with an anti-agitation agent, the safest one available. And so I think there will continue to be a very important role for Auvelity regardless of what happens in the antipsychotic space.

Rudy, regarding your question around Rexulti dynamics and learnings, obviously, we think the Rexulti team has done a nice job in building awareness and trial of Rexulti over the past few years. We've been students of their approach. Obviously, the adopters of Rexulti are likely adopters of Auvelity and their choices in terms of engagement with health care providers and the caregiver community have been things that we've evaluated to inform our launch strategy. So without going into too many specifics, I would just say that they've done a nice job and has given us a lot of confidence in the market opportunity for Auvelity as we enter the space.

Our next question is come from the line of Sean Laaman with Morgan Stanley.

My first question is more macro. So obviously, Alzheimer's a significant economic burden. But I'm wondering if you have a sense of how much this indication contributes, if you have a number around that. And as we think about the alleviation of that burden, what would be the economic benefit is kind of where I'm going?

And then maybe a question for Dr. Cummings. And just in terms of looking at the clinical practice, I mean, how much does this move the debate along? How much does 05 -- adoption of 05 move the debate along? Are these patients really going to be significantly more manageable in a practical sense?

Yes. Sean, thanks so much for the question. Obviously, the economic burden of Alzheimer's disease is significant when you take into consideration the amount of health care required to support these patients, the institutionalization, our estimates and there are a variety of estimates based on existing literature, but we're talking in the hundreds of billions of dollars annually within the U.S. alone. So the ability to treat these symptoms effectively to potentially prevent or delay institutionalization for patients can have massive benefits from an economic perspective on the health care system.

Maybe I could just add to that. I think if you look at just the mean differences between the placebo and the treatment group and take the most conservative view, there was at least a 25% reduction in the mean levels of agitation. And that's seen as an important threshold in terms of meaningfulness of the response. So -- and importantly, one of the trials used the patient or really, in this case, caregiver impression of change, which means that the caregiver was able to see the same change that the clinicians saw on the CMAI.

So I think these are changes that are appreciable to the caregiver. They're not minor. They are at least 25% in the mean, which means that some patients do very well. Some patients probably continue to have substantial agitation. We're going to have to work that out. I think we need responder analysis. We're going to need more studies. We're going to have to understand this in much more detail than we currently do. But on average, the change was -- so it would be the most conservative view, and it was still accepted as or will be accepted as within the range of meaningful.

Our next questions come from the line of Graig Suvannavejh with Mizuho.

Congrats to the team on the approval. I just want to get another perspective on how to think about launch trajectory given the knowledge that you've got basically 2 prescriber segments, whether it's PCP-oriented or long-term channel-based segment, how should we think about the launch trajectory in each of those segments? And can you remind us whether prescriptions in long-term care get incorporated into the prescription data services?

And then a question for Dr. Cummings. Just given your experience with treating Alzheimer's patients, how -- what's your estimation of the awareness of Auvelity as a potential treatment for agitation amongst the broader Alzheimer's prescriber community?

Yes. Thanks for the question. So in terms of launch trajectory, as you mentioned, primary care is a large segment of this treatment population, followed by specialists in psychiatry, neurology and geriatrics. We expect there to be adoption across specialties. I think it really comes down to the volume of patients that exist in any one practice. And so not necessarily specialty specific, but practice specific. And so our expectations just from a national perspective is we anticipate growth acceleration to begin in Q3 and build throughout the second half of 2026.

As it relates to the data sources, as you mentioned, long-term care, which is sort of a new wrinkle for Auvelity sales. IQVIA, Symphony do capture portions of long-term care, but there are some unique dynamics in certain facilities that may not report directly through IQVIA, Symphony. So we're working on ensuring that we have a transparent view of data across both community and long-term care settings.

And I can take part of that question also. In terms of the prescribing and the long-term care question, which is part of this discussion, it's important to remember that the medical directors of long-term care are docs that have other jobs and their PCPs or their geriatricians that are familiar in general with caring for older patients and patients with Alzheimer's disease.

In terms of how aware is the medical community of this program, of course, it's been called AXS-05 in the development program in the clinical trials. And I think it is not well known by the medical community. However, I think it's going to be very interesting because as soon as they realize that AXS-05 is Auvelity, I think they'll say, "Oh, I know that drug." And they'll be comfortable with it. So I think once that educational get about these two names being the same drug is bridged, then I think it will be a relatively easy transition for prescribers.

Our next questions come from the line of Myles Minter with William Blair.

This is John on for Myles. And also I would like to echo our congratulations. So maybe a follow-up to the question on psychosis for Dr. Cummings. Wondering if you can give us an idea of the proportion of patients that have overlapping agitation and psychosis, which would conflict with Rexulti's prescribing giving the black box warning there.

And then for the company, are these patients with overlapping agitation and psychosis readily identifiable? And could they be leveraged as an initial pool to drive early uptake?

So I'll jump into the first question. psychosis occurs in about 25% of Alzheimer's patients and agitation, as you've seen, about 75%. So you would say that roughly 1/3 of agitation patients have symptoms of psychosis. Some of that psychosis is relatively minor and some of that agitation is relatively minor.

So I would just say that it's certainly far from all patients with agitation being psychotic, but it's a nontrivial number, which also have psychotic symptoms. And it's one of the things we're going to have to look at more closely. In the Rexulti studies, they limited the amount of psychosis to 30% of the population, but it did represent roughly, again, about 1/3 of the patients with agitation.

Yes. And John, your question about could this be a specific segment of patients that we target. I would say our focus is on all agitation patients, not just specifically patients that might have overlapping psychosis symptoms. And the reason for that is based on the label, the totality of data, this is a first-line option for any patients suffering from agitation associated with Alzheimer's disease. So that's our orientation as we enter the launch.

Our next questions come from the line of Brian Skorney with Baird.

Let me offer my congratulations on the approval as well. So we've all watched the Rexulti launch in Alzheimer's agitation, and we spent a lot of time kind of talking about some of the nuances and differences between Auvelity and Rexulti. So maybe, Ari, if you could kind of just give us a synopsis in terms of compare and contrast where you think Auvelity is positioned in terms of coverage, physician enthusiasm, just the operational aspects of the launch versus Rexulti? And do you think that the Rexulti Rx curve, is that a reasonable hurdle to hold you to? And what do you see as the primary reasons why this launch could outperform or underperform Rexulti's initial launch in Alzheimer's agitation?

Yes. Thanks for the question, Brian. Obviously, we're very enthusiastic about this launch and the enthusiasm we're receiving from health care professionals, caregivers, advocacy organizations is equally as high. I think you saw some of that in just the press release announcements coming from the Alzheimer's Association yesterday.

Our expectation relative to Rexulti is not necessarily to compare ourselves to Rexulti. Obviously, it's the only analog in this space because it's the only other approved agent. And so I do think it's helpful from a directional standpoint. But our expectation is that based on the totality of evidence and the strong clinical profile that there's a really good chance Auvelity will be considered a first-line treatment for these patients. And that's how we plan to approach the market. We think our insurance coverage will support that in the early days, and we're optimistic about the potential for impact. So we'll have more to share as we get into the marketplace.

Our next questions come from the line of Madison Wynne El-Saadi, with B. Riley.

Congrats on the approval. Auvelity and MDD, it took a few quarters to really inflect. Of course, you were building access from 0. This is a very different story now. So just wondering how we should think about the shape of the ADA ramp relative to, say, MDD, for example. What the right analog is here? And relatedly, what are the key drivers that would support Auvelity in agitation becoming the larger overall contributor?

Thanks, Madison. I do think your comment around Auvelity and MDD, the uptake from our perspective, the best analogs to look at for the launch are either Rexulti or Auvelity and MDD. Obviously, there are differences that are noteworthy, which you shared a little bit of. We obviously have more -- a larger base of insurance coverage than we did at the MDD launch. Our sales team is larger. There's awareness in the marketplace. Those are reasons for optimism.

The Alzheimer's agitation market is a little smaller than the MDD market. So in terms of overall patient opportunity, it is more limited from that perspective, but there's only one other approved treatment. And so from a competitive standpoint, there's less competitors to think about. So there are lots of factors that go into it. Our expectation is that we're focused on execution with the 68,000 HCPs we're calling on to maximize uptake in the early days.

And we'll in terms of reasons -- drivers of use, I think the fact that there's rapid onset of action, durable response in our short- and long-term safe trials as well as non-antipsychotic option, no box warning for elderly patients. I think one factor that we haven't spoken about today, but in long-term care facilities, in particular, star ratings are of importance, meaning delivering quality care to maximize reimbursement from CMS. And so having a non-antipsychotic for these patients will facilitate those star ratings. So there are lots of reasons for optimism. But ultimately, predicting the exact uptake is very difficult.

Our final question will come from the line of Yatin Suneja with Guggenheim.

This is Eddie on for Yatin. Congrats on the approval, and thanks for us in here at the end. I appreciate all the color so far you've talking about the differences between the two channels. But can you sort of put a pin on it and talk about how the company is thinking about how the earliest adoption patient mix between long-term care and community settings and then what you might think the longer-term revenue split overall would be between these channels?

Yes. Thanks for the question, Eddie. We're -- we expect there largely because we're currently in community-based settings that there may be earlier uptake in the community setting just by nature of experience with MDD and the existing relationships of our sales colleagues with those practices.

But with long-term care, we expect there, as I mentioned earlier, growth acceleration to begin in Q3 and build throughout the second half of 2026. I think in terms of proportion of business over the long term, it's hard to predict exactly. I would just say that today, when you look at prescription volume, roughly 60% coming from community settings, 40% from long-term care settings for agitation specifically.

Thank you. We've reached the end of our question-and-answer session. I would like to turn the call back over to Herriot Tabuteau for closing comments.

Thank you. Thank you, Dr. Cummings, for your time this morning and your valuable insights. We also want to thank the patients, health care professionals and our Axsome team for all their contributions that led to this approval. The approval of Auvelity for the treatment of agitation associated with dementia due to Alzheimer's disease exemplifies our mission to deliver innovative new treatment options to clinicians and patients living with serious CNS conditions.

Axsome today represents a singular CNS platform with now 3 commercial products approved across 4 highly prevalent conditions and a broad pipeline, including 6 novel product candidates that target 10 serious areas of unmet medical need across psychiatry and neurology. The continued performance of our marketed medicines driven by the accelerating growth of Auvelity and potentially first-in-class and best-in-class treatments in our pipeline promise to deliver substantial long-term value as we further our mission to advance the frontiers of brain health. Have a great day.

Ladies and gentlemen, thank you so much. This does conclude today's teleconference. We appreciate your participation. You may disconnect your lines at this time. Enjoy the rest of your day.

So thank you for joining us again this afternoon at the Life Sciences -- Citizens Life Sciences Conference. Excited to be joined next by Axsome. I'm going to turn it over to Mark Jacobson, the Chief Operating Officer, and we're also joined by CFO, Nick Pizzie. Thank you.

Yes. Thanks very much, Jason, and thanks to the Citizens team for having us. And we'll do this in 2 parts. So Nick and I will run through a brief overview of the company, and then we'll open it up for Q&A. So thanks again for having us.

And very quickly, of course, we've got obligatory forward-looking statements, and we may be making forward-looking statements today. So please review our filings with the Securities and Exchange Commission for a complete summary and overview of the risks and uncertainties associated with our business. Axsome is a commercial and clinical stage biopharmaceutical company. We are focused on central nervous system disorders, in particular, frontiers in central nervous system disorders, and our mission is to develop and deliver transformative medicines for the hundreds of millions of people impacted by CNS conditions.

2025 highlights, Nick, you want to cover those questions?

Sure. Yes. 2025 was a successful year for Axsome. We -- a couple of milestones that we hit for the year from a sales perspective was Auvelity surpassed over $0.5 billion in revenue. That was only the third year since launch. And total sales for the company were close to $640 million. So super excited. It's a nice setup for 2026 and how we're approaching on -- and the success that we've had in 2025. The biggest thing that we are looking forward to in 2026 is our PDUFA date for Auvelity in Alzheimer's disease Agitation. That PDUFA date is on April 30, 2026, so just a couple of months away. And currently, we are in the process of expanding the team from 300 to 600, which we'll get into in a bit.

Yes. And so fundamentals, just coming out of 2025, fundamentals for the business across all aspects, commercial, R&D and just the infrastructure supporting those categories of the business, it's never been better. So we're very well positioned going into, as Nick mentioned, key catalysts for the organization that are potentially transformative and just continued commercial execution.

Real quick on the current state of affairs for Axsome, and we think the business is -- we're in a very unique position here. We have 3 on-market products, which are innovative and highly differentiated, two of which we fully developed internally, Auvelity and SYMBRAVO. We have 5 differentiated and novel product candidates. And of those, we are conducting 7 late-stage clinical trials, so Phase III clinical trials that are either already underway or will be initiating shortly. That's 9 of the programs that are in the portfolio, in our pipeline have blockbuster potential, and we're focusing on 11 different conditions.

And those results -- and Nick, do you want to cover the potential opportunities?

Total peak sales for the conditions that Mark spoke about is north of $16 billion. And as you can see, greater than 150 million patients that these indications affect. And importantly, though, is that we have patent protection into the 2040s.

Yes. All the programs. Of those 11 programs, here's the pipeline, and we think about them as the overall umbrella is CNS, but we're very interested in unmet needs and in psychiatry and neurology. And here's how we break out the product candidate pipelines, and we'll review these in the coming...

Yes. So 3 commercial stage products in Auvelity, Sunosi and SYMBRAVO. We'll talk about peak sales shortly as it relates to them and then multiple Phase III assets that are -- that we're assuming positive clinical readouts, which we'll get into that as well shortly. We would expect a launch sometime in the late 20s and then most recently, AXS-17 to the pipeline as it relates to epilepsy indication.

So here is just kind of a nice little solar system of how we think about peak sales. And as I shared earlier, about the $16 billion. So if you think about what we have already commercialized and continue to grow, it's in the neighborhood of $2 billion to $5 billion. That's that lower semi circle there. And then really what has gotten the most focus over the last, call it, several months is the AD Agitation indication with the PDUFA date of April 30, that we've shared peak sales of $1.5 billion to $3 billion for that indication alone.

So if you think about Auvelity and AXS-05 is Auvelity, it'd be somewhere in the neighborhood of $2.5 billion to $6 billion. These are peak sales that we've put out prior to launch, and we'll look to assess peak sales if and when we do receive approval.

So recent -- just -- we touched on 2025 as a year of execution and transformation for the business, just reviewing some of those accomplishments and recent accomplishments so far to start this year. Obviously, the launch and -- the approval and launch of SYMBRAVO, sNDA submission of AXS-05 for Alzheimer's Disease Agitation that was accepted and filed and granted prior to review.

And 2 other items to focus on with trials. So we had a number of positive trials over the past year. And then we've recently initiated the FORWARD Phase III trial of AXS-14 and fibromyalgia and then the CLARITY trial, Phase III trial of solriamfetol in major depressive disorder with individuals who have symptoms of excessive daytime sleepiness.

And then looking ahead, we touched on, obviously, the sNDA PDUFA date of AXS-05 in Alzheimer's Disease Agitation over April 30. And then we have an imminent NDA submission of AXS-12 for cataplexy in narcolepsy. We're about to push the button there. We have top line trial readouts anticipated in the second half of this year for solriamfetol in binge eating disorder. That's the ENGAGE Phase III trial and then the SUSTAIN Phase III trial of solriamfetol in shift work disorder. We anticipate those top line results next year.

And we'll be initiating a number of trials across the product candidate pipeline in the coming months, and we'll touch on those in the coming slides. So 2026, the 4 pillars of focus, commercial performance, number one, continue to drive growth, and we'll cover that, but we will be investing further in all elements of the business to not only continue current trajectories, but drive them further. Auvelity prepare for a launch for a potential approval. If the product is approved and advance all of the R&D programs, all 11 of them, and we'll continue to do that, and we'll look towards growth there. And supporting all of that will be continued growth in the team and infrastructure that supports the business.

So again, our 3 main products, Auvelity, Sunosi and SYMBRAVO, I'll dig deeper. We have slides for each one of these. But again, combined total peak sales of $5 billion across these 3 brands in these specific indications. Auvelity, probably the key point again is going -- is doubling the field force. We're going from 300 reps to 600 reps, and we're in the process of that recruiting. Currently, we anticipate that we'll have that completed by Q2 and ideally before the PDUFA date of April 30.

Sunosi continuing to grow. We acquired that asset back in 2022, and it's been a really nice performing product for Axsome, grew 40% year-over-year in a -- with a very mild, moderate level of investment into that program. And then SYMBRAVO, we just launched that in June of 2025. So we're just getting off the launch pad there, and we're seeing some nice growth in scripts. And really, the next key driver of growth would be to improve the payer coverage.

Auvelity, very quickly, oral NMDA receptor antagonist, sigma-1 agonist. It's approved for major depressive disorder in adults; works quickly, works rapidly, sustained and a distinct tolerability profile. Very quickly, Nick touched on some elements of sales to date, but making a very quick impact as a treatment option for patients in terms of -- in the early days, later-line patients and now about 50% of utilization, just over 50% is in first or second line or so first line or first switch. More than 50% of the scripts are coming from -- as monotherapy, and we're seeing important growth in primary care. So now primary care, that makes up about 1/3 -- about 1/3 of prescribers are primary care.

And that's really a key initiative for Axsome and for Auvelity for 2026. Part of this expansion is to drive further in the primary care market. We're currently only 0.2% of the market share in total antidepressant market. So we feel that, that number can grow significantly as we get into primary care. We've been able to perform and annualize already at north of $600 million with a relatively small field force compared to some of our peers. On average, we've had somewhere in the neighborhood of 200 to 250 reps. During the course of this, we ended the year around 300 reps, just under 300 reps. But being able to annualize where we are with market access that has improved, we're currently now at 86%, which we're pleased with.

We're looking to further improve and evolve that, meaning to have improved formulary access. But 86% total covered lives, of which 78% is in the commercial channel, 100% in the government channel, which is important as we'll talk about for ADA, Alzheimer's Disease Agitation, where most of the scripts will be coming in that channel. So that will be one hurdle that potentially can be avoided upon the launch of ADA, where access will be available. So the focus with going from 300 to 600 reps is we expect to be able to get that return on investment because we'll be able to -- we have the covered lives. We'll get in the primary care market. And also, we did a direct-to-consumer TV campaign in Q4, which we will look to continue on during 2026, but maybe at a different level than what we did in Q4.

Quick snapshot of sales. Do you want to touch on?

Yes, just great growth, 68% in total sales quarter-over-quarter growth Q4 to Q4 and 74% so surpassing $0.5 million in total annual sales and multiplying the $155 million by 4, north of $600 million annualized already 13 quarters in. So pleased with that growth, again with a relatively smaller field force team. But looking at comps 13 quarters in versus 13 quarters for other comps, we're outpacing them as well. So really pleased with the performance of Auvelity.

Yes. And that corresponds to the clinical profile. That's what we're seeing in the real world and the feedback we're getting from clinicians of how the treatment option for patients and prescribers is doing well. Turning to Sunosi. Nick touched on, this is a product that we acquired, and we're very pleased with how it's growing for the currently approved indications that's excessive daytime sleepiness associated with narcolepsy and obstructive sleep apnea.

Again, just continued growth. We saw 40% growth in revenue year-over-year. So demand growth has continued to grow. Thank you. And the price impact actually has been positive. So being -- seeing that 40% growth and then 33% year-over-year, while we've had this asset since second quarter of 2022, I think it was launched sometime in the late around 2018, 2019 by the predecessor. So overall, again, super healthy and basically continue to grow while we are developing it for additional indications that are much more meaningful even from a peak sales perspective compared to the current indications in $300 million to $500 million right now.

We'll obviously get into those momentarily. Then just looking at SYMBRAVO. So this is our third product candidate and the second that we developed fully. This was approved about a year ago, and we launched it, as Nick mentioned, in June of last year. So it's a multi-mechanistic, is rapidly absorbed, and it's a distinct treatment approach for the acute treatment of migraine. And this utilizes Axsome's MoSEIC technology, which drives absorption. So you get in terms of how you reach Tmax and PK dynamics underneath, which lead to rapid pain relief, which is sustained and durable with a very nice tolerability profile.

We're pleased with where we're at. SYMBRAVO is flying a little bit under the radar on a lot of investors' minds right now, which is fine. It's doing its thing. We've seen pockets in the country where it's really outperformed expectations and even peers at the same time at launch. And we are doing it with a discrete field team. We have roughly 100 reps. Some of our peers launched with 800 reps or north of that. So it's a similar playbook that we did with Auvelity out of the gate with 160 reps in a mass market. This is obviously a similar large market. And as payer access comes online and as trial and adoption increases, we're super excited about this asset. I know it doesn't get a lot of play right now with Auvelity, specifically around the ADA indication coming about, too, but looking forward to the future for SYMBRAVO.

And we like the feedback we're hearing from clinicians about the product profile and that it's aligning with the data we've demonstrated for the clinical program. And real quick, we'll touch on the pipeline, and we'll just from time constraints, we'll skip through this. We touched on AXS-05 for Alzheimer's Disease Agitation. Reminder, it's an oral NMDA receptor antagonist, and it targets a number of pathways that are relevant in agitation. This is Alzheimer's Disease Agitation, which is one of the key symptoms and concerning symptoms of individuals with Alzheimer's disease. So about 7 million people in the U.S. with Alzheimer's Disease and north of 70% of those have symptoms of agitation.

And this is a critical symptom. It often is the symptom that leads to placement in long-term care facilities. And right now, a high area of unmet need. The -- there's only one approved product and the majority of treatments and interventions that are used are off-label atypical antipsychotics and antidepressants. We have an sNDA, as mentioned, that's under review by the FDA right now. This is a division of psychiatry. The application has priority review, PDUFA date, April 30. And it's got a robust clinical program supporting that.

We had -- here, we highlight results from the ADVANCE-1 and ACCORD-2 trials. We have 3 positive trials that are part of the package, a stand-alone ICH safety database. And we're within -- PDUFA is less than 2 months out. So Nick touched on some of the prelaunch activities we are doing for a potential approval to be ready for that. And we're obviously very excited about this program, both from an efficacy perspective as well as the tolerability profile that we saw in the clinical program.

AXS-05 is also being developed for smoking cessation. We're about to launch a Phase III trial here in the indication. We'll have more to say soon. But obviously, this is a very impactful therapeutic area and 34 million adults in the U.S. smoke. And as a result, half of them have a disease that is related to their smoking. And just the health care impact and costs are substantial. So stay tuned for updates here, and we'll be launching a study soon.

Solriamfetol, as Nick touched on for Sunosi, we have 4 indications that are of interest, and these all tie to clinician feedback about the product profile and underlying mechanistic rationale for these areas of development and in particular, it is dopamine and norepinephrine reuptake inhibitor. So it's wake promoting, but we also see other changes that may be relevant to impulse control or inhibition and other sleep-related indications.

Four Phase III programs, ADHD, MDD with excessive daytime sleepiness symptoms, binge eating disorder and shift work disorder. Quick status of these studies, but we'll touch on these here individually. So Attention Deficit Disorder impacts a substantial number of people in the U.S., 22 million and about 7 million are children. And for our program, we have so far completed a positive Phase III trial in adults. That's the FOCUS trial. And we will be launching 2 trials in pediatrics, so one in children, one in adolescents, and that's coming up soon.

And those are the next components of the clinical program that we plan to conduct for potential label expansion efforts. MDD with excessive daytime sleepiness symptoms, we've recently -- this is a precision approach to Major Depressive Disorder -- pardon me, precision approach to Major Depressive Disorder. So approximately 50% of individuals with Major Depressive Disorder have symptoms of excessive daytime sleepiness. And we are very interested in this for Sunosi or solriamfetol in particular, given its wake-promoting effect. So this is not depression in individuals with excessive daytime sleepiness. It's the other way around.

This would be for the treatment of Major Depressive Disorder with -- through a lens or component of sleep. And we do anticipate this could be a distinct indication for solriamfetol. So we completed a proof-of-concept trial. We completed that last year and have recently launched a trial -- Phase III trial here. And so we haven't guided to top line results yet, but you can expect that from us soon.

Binge eating disorder, this is in a Phase III trial right now -- in the ENGAGE Phase III trial. This is solriamfetol. And again, this is -- there's a mechanistic rationale here that we are exploring, and we're excited about this study. We expect top line results in the second half of this year. And then the final clinical program that we're running is in shift work disorder. It is obviously adjacent to the current indications, which are excessive daytime sleepiness.

Here, this is another element of sleep dysregulation, and we're conducting the SUSTAIN Phase III trial. We anticipate top line results next year. And we have aligned with FDA that because this is a related condition to the currently approved programs, our expectation is if the SUSTAIN trial is positive, that's the only study we need to support potential label expansion.

AXS-12, and we'll be very snappy here given we're low on time. This is our product candidate reboxetine. We have completed the clinical program. We are submitting an NDA for cataplexy in narcolepsy imminently, and we're excited about this program. It fits very nicely with the Sunosi sleep field force that we have in place now. And just very quickly on the -- some of the clinical data and the clinical trials that support the package, the CONCERT and SYMPHONY trials where we saw a robust impact on cataplexy.

AXS-14, this is the SS-enantiomer of reboxetine. So Esreboxetine, we have 2 completed trials, a Phase II and a Phase III trial where we saw important and robust statistically significant -- highly statistically significant results in reductions in pain and an impact on fatigue. So we've launched a Phase III trial. This is based on feedback from the FDA that they wanted to see another fixed-dose 12-week study with reboxetine. So we launched the FORWARD trial to generate the additional data that FDA has requested of this and of us, and we'll provide guidance here for when we anticipate top line after we've conducted the study for some time and we have a sense of enrollment trends.

We're very excited about this program. And here's a quick snapshot of the trial design. So this is a randomized withdrawal design trial where there's a portion of open-label treatment with AXS-14 and then there's a randomized discontinuation phase.

Finally, we have AXS-17, which is a new program. We recently in-licensed this. So this is a subtype selective alpha 2, 3 GABAA PAM, and we plan to develop this for epilepsy. We -- 2026 is all about Phase II enabling work, tech transfer and indication selection. So we'll have more to say on this program, in particular, the specific indication that we plan to launch, but we're pretty excited about this, and this rounds out the product candidate pipeline, which is very heavy in late-stage programs. So this starts to build out our earlier-stage pipeline. So all of the programs are protected by robust patent portfolios. And I'll just point out that AXS-12 has orphan drug designation.

Yes. So -- and everything that Mark just talked about is fully funded. That's a great thing. We're in a fantastic financial position, $323 million on the balance sheet, takes us to cash flow positivity. We've already seen quarters where we actually had cash flow positivity, specifically Q3 of 2025. So looking to further have sustained cash flow positivity and profitability shortly thereafter. Small amount of debt, around $190 million. We refinanced our loan with Hercules to Blackstone last year. Pleased with that from a cost of capital.

And one of the things that we've shared is that operating leverage continues in the company. So we grew revenues 3x faster than OpEx in 2025, and we expect to have continued operating leverage in 2026 even with doing all these things, including the expansion that we're planning to do in the first half of this year.

I think with that, that concludes our presentation.

Great. Thanks, guys. Really appreciate it. Let me throw a couple of questions here. The field force expansion, can you just talk to what proportion or a piece of that is focused on AD Agitation launch specifically versus, for example, you said growing the primary care exposure.

Sure. So we're going from 300 to 600. Those 600 reps will be doing ADA and MDD. So it's going to be depending on their call points and the way that we've recalibrated the geographies throughout the United States. They will have -- the reps will have MDD call points as well as ADA call points. So there's no specific reps that we focus on that. Aside from, we will have a discrete team on top of that 600 that will be calling on long-term care facilities. We currently haven't called on long-term care, significant comorbidity between -- with MDD, Depression and ADA in that space. So that team will be focused on long-term care, but likely more in the ADA market.

And there's high overlap with -- especially in primary care for those who are potential prescribers for Depression as well as AD Agitation. So each team member within the geographies will have a mix of targets for Depression, Alzheimer's Disease Agitation and both.

Obviously, just a few weeks away now from the PDUFA date for AD Agitation. I know you're not going to say a lot here, but just FDA interactions, how does feel towards the PDUFA date?

Look, it -- for where we are today, you're correct. We just, as a matter of process, don't comment on real-time day-to-day updates. But what we can share is breakthrough therapy designated, priority review granted. And a reminder, April 30 is the PDUFA date. So we're getting very close. And things are where you would expect them to be at this point in the review. And that comment is informed by our interactions with team, our field division vision into the division of psychiatry. We're not aware of material changes to the team or any changes along those lines. So it's -- again, things are where we'd expect them to be, and we're preparing for potential launch if the product is approved.

Yes. All -- everything is churning internally. We have actually a non-branded campaign website, alzgoals.com, alzgoals.com. Medical affairs team is doing its thing in preparation for the launch and marketing same thing, doing all that prep work prior to a launch.

Great. Well, Mark, I really appreciate you guys coming.

Thank you.

Thanks a lot, Jason. Thank you.

Thanks, everybody, for joining. Sorry we're a little late. logistical issues, but we're good. I'm Marc Goodman, one of the biopharma analysts at Leerink, and we're lucky enough to have Axsome Therapeutics with us. And we have Mark Jacobson, who's the COO; and Nick Pizzie, who's the CFO. Thanks, guys, for joining us.

So why don't we just start with Auvelity and just give us kind of a little bit of a load down on what's happening with Auvelity right now, just from a marketing strategy perspective, how you're thinking about things this year relative to what you were doing last year and the year before? What's changing?

Sure. Yes. Maybe I'll start. Thanks for having us, Marc. So Auvelity ended the year last year, annualizing just north of $600 million, and it is the third full year since launch in 2022. So really pleased with the performance. We're outpacing some of the peers in the space. So very pleased with that. And that was with, I'll say, a smaller field force. We started with 160, did an expansion in '24 to 260 and then got to the most recent levels of 300 in 2025. And also with market access, that has evolved and improved over time. And currently, we're at 86% coverage.

So been pleased with the performance from a revenue perspective and script growth. One of the things that we are doing in 2026 is expanding the team from 300 reps to 600 reps. So real meaningful expansion, really doubling down on Auvelity, specifically in MDD, but also in ADA, which we have a PDUFA date of April 30. So in preparation for an approval in ADA, we will have a 600 field team detailing Auvelity. And then also, we do plan to have a small dedicated team, tactical team, specifically around ADA for LTC from long-term care centers.

So Auvelity is doing its thing. We're really pleased with it on blockbuster status. Currently, we've shared that peak sales are in that $1 billion to $3 billion range only in MDD, and we've also shared $1.5 billion to $3 billion in ADA.

And that -- yes, all that aligns with some of the dynamics and investments and just strategy for the year. It corresponds to what we're seeing clinically and which matches the clinical data we've generated in the label, right? Different mechanistically, that different mechanistic profile results in a different clinical profile. So it's working rapidly. It's durable, a distinct safety and tolerability profile. And so then we're seeing that translate into -- from the start, later line scripts, but it's being pulled up in the treatment paradigm to first and second line account for over 50% of the scripts now, and it's gradually increasing quarter-over-quarter.

But first line, it's around 15%, and that's ticking up. And so that put it about 35% for second line. That corresponds to our investment in the sales force for the outlook for this year, about more than 50% is monotherapy use, and we're seeing more and more uptake in primary care. So latest numbers are about 1/3 of the scripts are coming from primary care. So that's increasing. So the trend, it's all tracking very nicely. when you zoom out from launch to date, and we expect that to continue, and then we're investing in it to drive it further.

So the increased sales force will hit primary care a lot more.

Yes.

And that also includes the new indication. You're not changing if you get the new indication.

Correct. Correct. Yes. So it's complementary and anticipatory to that, but not contingent upon the new indication.

And maybe just lastly on the expansion. So market access getting to 86% of the total covered lives, we feel that now is the right time to essentially double down to be able to -- that we know that if a patient gets prescribed Auvelity that they'll be able to get it through their insurance coverage. And going to the primary care, one of the things that we've been sharing is $600 million -- annualized $600 million in revenue, we're only at 0.2% of 1%, so 20 bps of the total antidepressant market right now, and we're annualizing at $620 million. So our goal is to really drive penetration from that perspective.

Yes. And DTC advertising has started?

DTC advertising from a mass media television, you're defining it that way, yes, we did that in September, and we ran that all through Q4. So we had a lot of learnings from our DTC spend. And January, February, we're actually off the air. And essentially, the way we're thinking about it is with this field force expansion, we are reallocating our resources from DTC to expanding the sales team. We will have DTC, and we're back on the air now in March, and we'll continue to be on the air.

But what I can say is we've learned a tremendous amount on what channel between linear and connected TV and how best to appropriate those funds and how to actually be more efficient in DTC as well through those 4 months. But ultimately, we feel let's expand the field force. We can add DTC back further on, and that will actually complement DTC's ROI by having more boots on the ground, you'll see more pull-through from the DTC campaign.

How much extra gross to net did you have to give up as you've really increased this coverage?

Not much. I think we've -- if any, I think we've been mindful as we've negotiated and thought about the value of Auvelity, right? And we have exclusivity if we have pediatric indication through -- or into 2039. So we never thought about the short term. We always thought about the long term. And from a GTN perspective, we've been somewhere on average, let's call it, around 50%. Last year, if we think about it, we were in the mid-50s in Q1 and Q2. We were in the high 40s in Q3 and Q4. So overall, roughly 50%. And we -- as Mark shared, we are -- 50% of our scripts right now are either first line or first switch.

So not only have we gotten quantity of coverage and getting to 86% covered lives, importantly, 100% in the government channel, and that comes into play specifically around ADA. So 100% of Medicare Part D lives are covered, which is great formulary coverage for those individuals, but 78% on the commercial side, so total 86% with good formulary access.

The AD agitation indication, obviously, a major focus, very important for everyone to get this. How is that looking? How is it feeling? Have we -- is labeling looking like it started discussions? Like where are we?

Sure. The -- I mean, as you know, as a matter of practice for us, we don't comment on play by play. But if you step back, so breakthrough therapy designated program filed and accepted with priority review. PDUFA date is April 30. And so labeling generally begins approximately 30 days ahead of PDUFA. So we're outside of that. And what we've shared is, for us, things are where you would expect them to be at this point in the review. And that comment is made based on our -- it's a generalized comment, right? It's general, but it's informed by our vantage point of how the review is going.

And the other element we've shared is typically sponsors, you interact with the project manager. And so we haven't seen within the psychiatry division. So from our vantage point, things are status quo with respect to the division, and it's going on. So it's coming up. And then in a way, Nick's already previewed some of the commentary, the work that is underway in anticipation of potential FDA action that would allow us then to launch the program. So...

And the other indication potentially for the drug is smoking cessation, which probably you don't get a lot of questions about. But maybe just give us a quick update on that and how fast we can get this indication.

The -- so that's always been an area of interest to us just due to the mechanistic rationale and high overlap with prior available therapy in terms of -- I'm not going to repeat myself, but we think the mechanistic rationale is strong. And so we've been working on that. The clinical operations setup and getting those gears turning is well underway. And that's -- we'll be starting that study soon. And our expectation is we'll run the first study that will share details on the study design very soon and offer guidance then about time lines.

But we're excited about getting that program off the ground finally. It's -- we've been really focused on AD agitation as all in on that as the next potential program for Auvelity AXS-05. And then as we work through that, we'll have more to say about other areas such as smoking cessation that we think are really interesting for the mechanism.

Yes. Yes. Let's talk SYMBRAVO, new drug launched. Just give us a sense of what's happening out there. What are you hearing? How is the product doing?

We -- what we're hearing is that the product is doing well and that it matches the clinical data that we've generated, which is that it's efficacious, it's working well. The efficacy is durable and that the safety and tolerability profile is commensurate or positive for that efficacy profile, meaning you're seeing patients try the medicine and then continue to use it. And...

So where is it being used in the migraine space?

Sure. I mean, initially, it's later line, right? And the migraine space, in particular, is heavily managed by payers and for branded entrants. And so you see that and also just with any new branded product, even in areas of unmet need, they tend to be used later line first because clinicians have kind of their standard of care approach and...

But are you post CGRP or you can be...

Well, you can see -- I mean, we haven't shared, say, quantitative how many are coming from each line or post -- pre or post CGRP. But you can see utilization. And if you're segmenting the market like that, you can see utilization across segments. in both segments. That makes sense based on the clinical data we generated, right? We've studied the product in patients with inadequate response to prior acute migraine treatment. That includes oral CGRPs that includes triptans. And then we've also looked at -- we generated data in kind of a less inadequate responder patient population. So it makes sense how we're seeing it used, and we like the early trends.

Now to touch on how launch is going. We wanted to have a very discrete tight launch. So sales force, it's approximately 100 reps that's by design. So that's pretty tight. And it's because we wanted to focus on early utilization to see how it performs in a real-world setting in, say, headache centers and with headache specialists, those patients, by the way, also tend to be later line. So we're understanding the product profile, how it's getting written, how it can be written and then how our kind of patient support and patient savings infrastructure aligns with that, and then we'll continue to calibrate and refine as we invest further in the brand. So we like where it is right now.

We're still in the limited launch phase.

Yes, absolutely. I think you take a look at what we did with Auvelity with 160 reps in a mass market. We're taking a similar approach with 100 reps or so with SYMBRAVO. And then ultimately, market access is what we're -- what our focus is and trying to get coverage. We're roughly around 50% covered lives right now. And one of the things that we noted in our most recent earnings is we signed our last contract. So now we have 3 GPO contracts signed to pave a way to be able to get access and have negotiations with those payers to improve those covered lives.

Got it. Got it. Sunosi, what's happening with Sunosi? Anything new? I mean have been around a long time and still growing.

We're very pleased with Sunosi. I mean it grew 40% year-over-year. So we have a very discrete team with that. There's roughly 70 reps for Sunosi, very moderate sort of investment as it relates to Sunosi. So taking a look at, it's a very healthy business. So we're pleased with that, continue to grow. And with the 4 indications that we have behind it, that will hopefully further accelerate Sunosi revenue.

Which one of those do you think has the best chance of working?

I mean we like all the indications. I...

Binge eating...

Mechanistically. Yes.

Shift work disorder, MDD. And is there -- what's the other one?

Shift work, binge eating disorder, ADHD.

ADHD, sorry.

That small thing. The -- yes, we tend not to offer kind of like stack probability of success for those programs. But what's one thing? So shift work, it's adjacent or immediately related to the current indication, right? And because of that, actually, we previously obtained FDA feedback that we need one trial there to support label expansion, and that's because the current body of data on label, if the study is positive, could be considered supportive.

So that's one way to think about it, whereas the other indications, we're planning 2 studies. MDD, maybe that's a little more speculative versus ADHD and binge eating disorder, which correspond to impulse control and some of the neuropsychopharmacology around those indications and then the molecule. MDD, though, we were excited about. So we ran a proof-of-concept study in MDD, and we looked at individuals with. And so it's kind of a precision approach to individuals with symptoms of excessive daytime sleepiness and those without. And so we just announced the start of a study in individuals with major depressive disorder with symptoms of excessive daytime sleepiness. So that's going on.

And then the other 2 binge eating. That study is underway. We expect top line results. That's the ENGAGE trial. We expect top line results in the second half of this year. That would be the first Phase III trial we're conducting. And then ADHD, we're starting 2 studies in pediatrics, one in children, one in adolescents to complement the study in adults that we have the Phase III trial that we've completed in adults, which was positive.

So there are the -- and all of it, if you back up, it's coming from clinicians that when they talk about how patients do who are prescribed the product for sleep, they talk about its benefits for sleep, but also just global changes that patients experience. So we're -- that was the impetus behind doing a full clinical development suite of trials in a number of indications, and those will -- we've had success in some of the initial trials for those already. So we'll keep it moving. And...

Positive ADHD, one positive Phase III ADHD trial in adults and now we're doing the peds and the adolescents.

You need one for adults, you need 2 for peds.

Well, we -- yes, we're -- I mean, we're conducting 2 of in each segment for pediatrics, children and adolescents. We'll run them in parallel. And so -- and those are needed. The FDA has asked and asked all sponsors that if you're developing a product for ADHD that you have the pediatric assessments of pediatric clinical trials as part of the initial submission, right? It's dissimilar for other indications where you have a pediatric clinical plan that can often be done as a post-marketing commitment or requirement. Here, it's got to be part of the initial package.

And so how do you think the -- what's the hook of your product? How does it fit in? I mean we have ADHD stimulants that seem to work pretty well so...

Yes. The -- I mean, if you look at the adult data, so absolute change in line with the stimulants and a distinct tolerability profile, distinct scheduling profile. So you'd want to be somewhere in terms of highly efficacious stimulant like efficacy, right? Stimulants are used because they work really well, but then there are challenges from a tolerability and, say, scheduling perspective.

So if you're able to show any type of differentiation or complement that available kind of treatment option with a new one, that I think, would be pretty exciting. So early data so far are more than warrant the additional investment that we're doing, and we're excited about them. So we've got these 2 studies to run, and then we'll see.

So seeing stimulant-like efficacy in a nonstimulant, which is what we saw in the Phase III.

Yes. Yes. That makes sense. AXS-14, let's move to that one. So talk about reason to believe that the data will work. Talk about the fibromyalgia market being a good market to go after.

The -- so fibromyalgia, it is an underserved market, right? There's only one recent entrant. There were products that have been available, but underserved in terms of innovation. And AXS-14, as a reminder, we obtained that product from Pfizer. It's esreboxetine. So it's the SS-enantiomer of reboxetine. And Pfizer had run 2 studies, highly positive studies, a Phase II and a Phase III in the indication and then it was shelved for various reasons on Pfizer's part.

So we obtained the product and we worked on the tech transfer and recapitulating all of the manufacturing and waiting for all the data there that we would drop back into module 3. And so we submitted an NDA. This was last year, and we obtained -- we received a refuse to file. This is the pain division. And the reason for the refuse to file was simply that there was an objection to the design or the type of the Phase II trial, which the Phase II trial was an 8-week flexible dosing paradigm. And the feedback was they wanted a second trial that was analogous to the Phase III, which was 12-week fixed dose. So that was the only comment. The rest of the package was -- went through the preliminary filing review assessment. And that was the comment that led to the RTF.

So we feel really good about what we need to do, which is run another trial. We feel really good about the product and its activity on pain, on fatigue, the tolerability profile. And so we launched the FORWARD Phase III trial. We did that a few weeks ago. That's going to be a randomized withdrawal design trial. And the reason for that, right, is we already have 2 positive studies and placebo response rates are increasing significantly. So we like randomized withdrawal design studies with respect to signal detection.

And so now it's elbow grease in terms of recruiting and enrolling and conducting the trial. But then once that's done, we'll be able to turn around right away and resubmit. And so we...

And is pain one of the endpoints?

Yes. Yes.

So you'll have that on the label to kind of differentiate.

Yes. Yes. I mean highly statistically significant in the 2 prior studies. So it's clinical development, so that's -- you're always mindful of that, but we like the product profile and the data that we've generated. So we have high conviction in it and the study design we like, but then we've got to run the study and see what happens.

Talk about the newest product that you just brought in, the one you actually licensed, which is a little unusual you guys haven't done that in a while. So you've named it 17, AXS-17.

17, yes.

Yes. What data do we have? Why did you do it?

It's a subtype selective GABAA PAM, and we'll develop it for epilepsy. There's a ton of clinical experience actually in generalized anxiety disorder. There's solid anticonvulsant data that we've been looking at that more than substantiates investment in a clinical program in epilepsy. So this was sitting -- this really interesting molecule was sitting in essentially a defunct structure that had multiple parties involved. And so it crossed our radar and why we do it. It crossed our radar, looked really interesting, and we figured if we could kind of undo the Gordian knot that we'd move forward with it, very low risk from an investment perspective. And so that worked out, and now we've got to do the tech transfer, and then we're going through indication selection process right now.

So 2026 for AXS-17 is all about Phase II enabling work. So you can expect to hear from us updates there and updates on indication selection. Pretty excited. There are lots of different avenues. There's a lot of activity in the space now in epilepsy, which is fantastic for patients. And -- but it's many -- the majority of the epilepsy space is -- there are unmet needs, they abound, right? And so we're going through that now, and we're excited to have updates there.

But yes, it's new, but -- so I kind of talked about the economic rationale for why we did it, but it also fits very nicely with how our portfolio and pipeline is right now, which is very kind of top heavy. It's lopsided to NDA or late-stage Phase III programs. There's a ton of them, but the earlier work -- earlier-stage programs, we can attend to that, and we'll do that if there are programs that fit in CNS that leverage our internal experience or just...

Yes, I think our pipeline is really deep for launches into the late 2020s. So this is like next-gen for, let's say, early 2030s.

So the GAD data is what the other company was collecting...

Correct. Yes, yes, exactly.

And you're not going to pursue GAD.

Yes, yes. That's not the plan.

You're thinking of epilepsy.

Yes. Yes. The data -- and there are pretty robust and extensive models in epilepsy and just...

Yes. No, for sure.

Yes. So there's -- the data we have in hand for the molecule definitely establishes its anticonvulsant activity. So we're moving forward. But GAD, those data are going to be highly informative, and they'll have utility, especially with respect to the safety and tolerability profile. But GAD as an indication that's for AXS-17, that's not our immediate focus.

So what have we not talked about that we should talk about in the last minute?

12? Talk about 12.

We didn't talk about 12. I forgot about that one. Please.

The next thing.

One minute of 12.

Yes, all right. So AXS-12, that's NDA stage. So we're about to hit the button with the submission that is reboxetine for narcolepsy. We're focusing -- we've focused on cataplexy for the clinical program. And so we're about to submit the psychiatry division. It's orphan indicated. We'd expect standard review. And so we'll have updates as we go and make progress there.

And it fits right into our current Sunosi team, our sleep team. So it could be accretive very quickly.

Yes. Excellent.

Good morning, and welcome to the Axsome Therapeutics' Fourth Quarter and Full Year 2025 Earnings Conference Call. My name is Kevin, and I'll be your operator for today's call. [Operator Instructions] Please note, this call is being recorded. I would now like to hand the call over to Ashley Tong, Director of Investor Relations. Ashley, please go ahead.

Thank you. Good morning, and thank you all for joining Axsome's Fourth Quarter and Full Year 2025 Earnings Conference Call.

With us today are Dr. Herriot Tabuteau, our Chief Executive Officer; Nick Pizzie, our Chief Financial Officer; and Ari Maizel, our Chief Commercial Officer, who will begin our call with prepared remarks. Mark Jacobson, our Chief Operating Officer; and Hunter Murdock, our General Counsel, will also be available for Q&A.

Before we begin, I encourage everyone to visit the Investors section of our website to find the press release and presentation for today's call. Please note that today's discussion includes forward-looking statements regarding our financial performance, commercial strategy and operational plans, including research, development and regulatory activities. These statements are based on current expectations and assumptions and are subject to risks and uncertainties that may cause actual results to differ materially.

Please refer to our SEC filings, including our quarterly and annual reports for a description of these and other risks. You are cautioned not to rely on these forward-looking statements, which are made only as of today, and the company disclaims any obligation to update such statements.

And with that, I'll hand it over to Herriot.

Thank you, Ashley, and good morning, everyone. 2025 was a year of significant commercial, research and development progress at Axsome. Our commercial business is strong, with AUVELITY achieving sales of over $0.5 billion in its third full year of launch, SUNOSI growth accelerating and SYMBRAVO launching, adding a third pillar of growth.

Total revenue for the fourth quarter increased 65% year-over-year to $196 million and for the full year, increased 66% to $639 million. Our innovative medicines continue to meaningfully improve patient outcomes. Just our current commercialized products have the potential to achieve multibillion dollars in annual peak sales. To support the continued momentum of our current products and future launches, we have built a technologically enabled scalable commercial platform.

Against this backdrop, we are advancing a broad and innovative CNS pipeline, which includes 5 novel product candidates across 9 high-impact indications. I will provide an update on our pipeline progress, starting with our sNDA for AUVELITY in Alzheimer's disease agitation. We recently announced the acceptance of the sNDA filing and the receipt of priority review designation with the PDUFA action date of April 30. If approved, AUVELITY has the potential to address this prevalent and debilitating condition for which currently only one product is approved. As we approach the April 30 PDUFA date, launch readiness activities are underway, which Ari will discuss later in the call.

We are encouraged by the level of interest within the treatment community and expect awareness to continue to build in the quarters ahead.

Beyond the opportunity in Alzheimer's disease agitation, we are advancing our planned Phase II/III trial of AXS-05 in smoking cessation, with initiation anticipated in the second quarter.

Moving to the AXS-12 in narcolepsy, following receipt of positive FDA pre-IND immune minutes, we made significant progress with R&D package, and we expect to submit that imminently.

For solriamfetol, we continue to advance this differentiated molecule across multiple new indications, including ADHD, binge eating disorder, MDD with symptoms of excessive daytime sleepiness and shift work disorder. These new indications represent significant expansion of solriamfetol's potential to help patients and create value for stakeholders.

For ADHD, we recently completed a Type B meeting with the FDA where we reached the agreement on the planned Phase III studies in pediatric patients. We plan to conduct two Phase III trials in parallel, one in children and one in adolescents, and we are on track to initiate both in the first half of this year.

For MDD, start-up activities are underway for initiation this quarter of a Phase III trial of solriamfetol in MDD patients with symptoms of excessive daytime sleepiness.

For binge eating disorder, our ENGAGE Phase III trial of solriamfetol in the syndication is progressing, and we expect top line results in the second half of this year.

Finally, for solriamfetol and shift work disorder, we now anticipate top line results in 2027 based on current enrollment trends.

Turning to AXS-14. We recently initiated the FORWARD study a Phase III, double-blind, placebo-controlled, randomized withdrawal trial of AXS-14 in patients with fibromyalgia. This new study will supplement the 2 completed positive Phase II and Phase III trials of AXS-14 in this indication.

To complement our late-stage pipeline, we recently acquired AZD-7325, a novel oral GABA A alpha-2 receptor positive allosteric alsteric modulator. We plan to evaluate AXS-17, the new designation for this compound for the treatment of epilepsy based on compelling data in preclinical seizure models. Further, AXS-17 has demonstrated a favorable safety profile in over 700 patients to date. Phase II trial enabling activities are underway, and we look forward to provide updates on this new development program in the coming months.

Taken together, our growing commercial business, the potential label expansion for ability and the robust innovation across our pipeline uniquely position us to continue to deliver new treatment options for patients living with CNS disorders.

With that, I'll hand the call over to Nick to review our financial results for the quarter.

Thank you, Herriot, and good morning, everyone. Our fourth quarter and full year 2025 performance reflects excellent growing commercial portfolio and the continued advancement of our industry-leading CNS pipeline. Together, these collective achievements firmly position us for the year ahead.

As Herriot mentioned, total product revenue was $196 million for the fourth quarter and $638.5 million for the year, up 65% and 66% year-over-year, respectively, which was driven by robust ability growth, the continued solid performance of SUNOSI and initial contributions from the launch of SYMBRAVO. AUVELITY achieved net product sales of $155.1 million for the fourth quarter, up 68% versus the prior year. AUVELITY sales surpassed the $0.5 billion mark in only its third full year from launch, totaling $507.1 million, representing a 74% year-over-year increase.

sunosi posted another strong quarter with net product revenue of $36.7 million, a 40% increase compared to the fourth quarter of 2024. SUNOSI revenue was $124.8 million for the full year of 2025, representing a 32% increase versus last year.

SYMBRAVO generated $4.1 million in net sales for the fourth quarter and $6.6 million for the full year following its second full quarter of launch.

Together, these results underscore the continued momentum of our top line performance and disciplined execution, which is resulting in further operating leverage in the business. AUVELITY and SUNOSI gross to net discounts in the fourth quarter of 2025 were in the high 40% range. Going forward, we expect AUVELITY and SUNOSI gross to net discounts to increase to the mid-50 range due to typical Q1 dynamics.

SYMBRAVO gross net discount for the quarter was in the high 70% range, which we anticipate will remain elevated during the launch phase.

Now turning to expenses. Total cost of revenue was $12.3 million and $47.5 million for the fourth quarter and full year of 2025 compared to $10.5 million and $33.3 million for the comparable period in 2024. Research and development expenses were $48.8 million for the fourth quarter and $183.3 million for the full year of 2025. That's compared to $55 million and $187.1 million for the fourth quarter and full year of 2024. The decrease in R&D spend for the year was primarily driven by the completion of clinical trials for AXS-05 and solriamfetol, which was partially offset by onetime acquisition-related costs and higher costs related to AXS-07.

Selling, general and administrative expenses were $169.3 million for the fourth quarter and $570.6 million for the full year of 2025. That's compared to $113.3 million and $411.4 million for the fourth quarter and full year of 2024. The 39% increase in SG&A spend for the year was primarily driven by commercialization activities for AUVELITY including sales force expansion and the national launch of a direct-to-consumer advertising campaign, along with the commercial launch of SYMBRAVO.

Net loss for the fourth quarter was $28.6 million or $0.56 per share compared to a net loss of $74.9 million or $1.54 per share for the fourth quarter of 2024. The $28.6 million net loss in the quarter includes $22.7 million in stock-based compensation expense. Net loss for the full year of 2025 was $183.2 million or $3.68 per share compared to a net loss of $287.2 million or $5.99 per share for the full year of 2024. This year's loss of $183.2 million includes $93.8 million of stock-based compensation expense.

Now turning to the balance sheet. We ended the year with $323 million in cash and cash equivalents compared to $315 million at the end of 2024. Looking ahead, we continue to believe that our current cash balance is sufficient to fund anticipated operations into cash flow positivity based on our current operating plan.

And with that, I'd like to now turn the call over to Ari, who will provide a commercial update.

Thank you, Nick. Axsome delivered strong performance in Q4 and completed 2025 with momentum for AUVELITY, SYMBRAVO and SUNOSI. Our outstanding medicines continue to meaningfully improve patient outcomes. With our planned investments for 2026 and the power of our innovative digital-centric commercialization model, we have high confidence in our ability to deliver upon the vast opportunities that remain for our growing portfolio of CNS medicines.

Beginning with AUVELITY. More than 225,000 prescriptions were written in the quarter, representing 42% year-over-year growth and 8% sequential growth. By comparison, the antidepressant market was flat over the same time period. Our sales team continues to drive uptake across prescriber segments, particularly in the primary care setting. Primary care clinicians represented approximately 1/3 of all AUVELITY prescribers in the quarter and continue to be the fastest-growing prescriber segment, further expanding the overall prescriber base alongside continued growth within psychiatry.

More than 5,300 new prescribers were activated in the quarter, bringing the total number of unique prescribers to approximately 52,000 since launch. Formulary access for AUVELITY also remains strong. As of January 2026, commercial coverage increased from 75% to 78%, bringing total coverage to 86% of all lives across channels, and we expect coverage to continue to expand and evolve throughout the year. AUVELITY's growth to date reflects its distinct clinical profile, fast onset of action, sustained relief from depression symptoms and a highly favorable safety and tolerability profile, supported by execution across our innovative commercial engine, reinforcing our confidence in the significant long-term commercial opportunity for the brand.

To support the growing demand in MDD and in anticipation of the potential launch in Alzheimer's disease agitation, we recently initiated our third and largest expansion of the AUVELITY sales force to approximately 600 sales representatives. We expect to complete this expansion in the second quarter and look forward to providing additional details of these plans in the months ahead.

Turning now to SYMBRAVO, which saw acceleration in new patient trial in Q4 resulting in more than 13,000 total prescriptions and approximately 5,300 new patients started in the quarter. Our disciplined launch strategy, targeting headache specialists continues to grow advocacy for SYMBRAVO among the highest volume migraine prescribers in the U.S., and we are pleased with the feedback from HCPs on the positive impact SYMBRAVO is having on patients.

The key clinical attributes leading to SYMBRAVO trial include the multi-mechanistic approach to migraine symptom relief, targeting multiple causes of migraine, rapid onset of action and positive impact on patient functioning within 2 hours. We are excited about SYMBRAVO's long-term potential as a preferred acute migraine treatment.

We continue to make progress with SYMBRAVO market access and coverage, with overall payer coverage at approximately 52% at the start of the year. The proportion of covered lives in the commercial and government channels is approximately 49% and 57%, respectively. In addition, Axsome successfully contracted with a third and final large commercial GPO for SYMBRAVO in Q4, which now enables negotiation with all major commercial payers and PBMs. We anticipate coverage for SYMBRAVO to expand and evolve throughout 2026.

And finally, SUNOSI delivered another strong quarter of performance. with more than 54,000 prescriptions, representing 11% year-over-year and 3% sequential growth. By comparison, the wake-promoting agent market grew 2% year-over-year and was flat versus Q3. Nearly 500 new clinicians prescribed SUNOSI in the quarter, bringing the total cumulative prescriber base to approximately 15,600 since launch. Payer coverage for SUNOSI remained steady at approximately 82% of lives covered across channels.

Overall, the performance of our innovative marketed products in 2025 underscores the effectiveness of our commercial strategy and execution and positions us well as we enter 2026. AUVELITY, SUNOSI and SYMBRAVO are delivering differentiated patient outcomes in the depression, excessive daytime sleepiness and acute migraine market. and together represent a proliferating growth foundation for Axsome. This year, our focus remains on scaling growth across our commercial organization and expanding adoption of our important CNS medicines.

I will now turn the call back to Ashley for Q&A.

Thank you, Ari. Operator, we're ready for Q&A.

[Operator Instructions] Our first question today is coming from Leonid Timashev from RBC Capital Markets.

I wanted to ask on what the implications are for you from the new FDA publication on sort of the 1 trial policy given the amount of trials that you're running. I guess I'm curious whether you think that means that some of the studies in binge eating and shift work disorder could potentially be approvable in a single Phase III? And then similarly, why given that policy, for example, you're running 2 studies in ADHD, splitting pediatric and adolescent patients?

Leo, this is Mark. So obviously, that's hot off the press and the team is assessing it. So 1 thing, as always, we always met our clinical plans with the FDA and the divisions that the programs are under. So we're going to continue to do that. And if there are changes, we'll see you mentioned shift work disorder. That's an example where we already have alignment with FDA that the existing clinical package could serve as potential supportive evidence should the study that we're conducting now be positive. So that's 1 example where that's the place I'll pass it to Herriot for thoughts on ADHD. But that -- our plans for ADHD, that reflects recent alignment that we reached with FDA.

Yes, yes. Just to add to what Mark was saying. One thing to keep in mind is all of this is a broad guidance. each critical situation, each indication is specific and has to be looked at from that perspective. So for ADHD, this is a disorder which affects different patient populations. For example, adults with ADHD are different from children with ADHD. So as you can imagine, this is a situation whereby you would not be able to -- or the FDA would not allow you to do just 1 study in adults, for example.

We're conducting 2 studies in pediatric patients with ADHD because, again, there is a subsegmentation of pediatric patients. So you have children, so those are individuals who are less than 12 years of age and then adolescents. So typically, the FDA does require data from both subsets of patients. It is possible, for example, to study both subsets of pediatric patients in 1 study. We decided to split it up into 2 studies, which will be conducted concurrently. And that will have no impact whatsoever on our eventual filing timeline.

Our next question today is coming from Marc Goodman from Leerink Partners.

Can you talk about AXS-17, just the types of epilepsy, the development plan that you're thinking about moving into? And you had mentioned that the product has been around has some history in patients. Just talk about what kind of data do we have?

Thanks for the question. So the product has been studied in different indications. So one indication that has been studied in, in the past is the generalized anxiety disorder. And all of the safety data and safety experience comes from those studies. So it's really nice that the product has been studied in a range of doses and also for chronic -- with chronic dosing. As it relates to the direction of going and looking at epilepsies, this is based on a pretty broad array of preclinical studies that have been done in epilepsy models that are predictive of clinical success.

And right now, what we're doing is we're starting -- we have started the work to make sure that we are Phase II ready. And also, we are very closely assessing all of the various different epilepsies in which the product in preclinical models has shown promise. So stay tuned. And over the balance of the year, we'll provide more details on which indication exactly which specific epilepsy will target first.

Our next question is coming from Jason Gerberry from Bank of America.

I wanted to just follow up on the comments just about AUVELITY, payer coverage evolving over the course of the year. And one thing I just wondered about, like as you add the ADA label, sometime in April, should that just mirror the MDD coverage? If not, is there a process for access build post the ADA approval? And the reason I ask, I think about other CNS drugs like CAPLYTA, right, when they added different indications. It was a pretty seamless coverage post the label add-on event. So wondering how that looks for you guys with AUVELITY and the ADA indication.

Yes. Thanks for the question, Jason. As you stated, in general, when you have a product that's on the market for a specific indication and then you expand the indication, generally speaking, your existing coverage should apply to the new indication. I think what's unique about MDD and ADA is that MDD is largely a commercial business, whereas ADA is largely a Medicare business. And so although we've had really good coverage across both commercial Medicare, we have been spending more time with the Medicare Part D plans to ensure coverage and utilization management is sufficient to support ADA uptake.

The other part of the comment about evolving over the course of the year, as you know, we haven't hit 100% access for the brand, and that is something that is our aspiration. So just continuing to work with plans that don't currently cover the product and continue to work on things like removing steps and PAs where they exist today.

Our next question today is coming from Andrew Tsai from Jefferies.

Thanks for the update. And back to Alzheimer's agitation, how should we think about the initial launch cadence in the first year? Do you expect your launch to be stronger than what [indiscernible] saw and only Alzheimer's agitation in terms of TRx volume and sales? And then maybe as a follow-up to the gross and net, specifically, where do you think combined gross to net for AUVELITY could trend or shake out over time?

Thanks for the question. We don't generally guide on where we expect the ultimate uptake to land. But suffice to say, we were actively preparing for the launch to enable commercial availability and customer engagement as soon as feasible post launch. And from our perspective, there's very limited analogs in the market. Obviously, there's only one other product. So we're studying that carefully as well as the MDD launch for AUVELITY to really assess where we think uptake will be on the first year. Once we have an approval, obviously, share additional details about our commercial effort, and so stay tuned for some more details later in the year.

Andrew, it's Nick. Just maybe a note on the GTN. So we anticipate that 70% plus scripts for ADA will be written in the Medicare Part D channel. And as such, that channel has a more favorable GTN specifically as there's no co-pay card utilization around that. So we would expect potential favorability from where we've been on the aggregate for AUVELITY.

Your next question today is coming from Pete Stavropoulos from Cantor Fitzgerald.

For SUNOSI, you had double-digit year-over-year growth. What were the drivers of that? Is growth more volume driven? Or are you seeing benefit from improved access, persistence or share gain? And is growth being driven more by narcolepsy or OSA? And are you seeing any differences in prescriber behavior between those 2 segments?

Yes. Thanks for the question, Pete. Yes, SUNOSI continues to deliver steady growth in both the OSA and narcolepy markets. As we shared before, approximately 70% of prescriptions are for EDS and OSA and 30% for EDS and narcolepsy. I think over the course of the year, we saw positive growth in new patient starts, total active writers and total prescriptions and part of our strategy over the past couple of years has been driving depth across existing writers. So we're seeing growth from both ends, both OSA and narcolepsy and really across specialty or prescriber segments, including PCPs, pulmonologists, sleep specialists and neurologists.

Your next question is coming from Benjamin Burnett from Wells Fargo.

This is Craig on for Ben. I appreciate the opportunity to ask a question here. I guess could you guys provide a little bit more color on the progress of the DTC campaign and you all mentioned that AUVELITY scripts continue to grow. However, the PD market has been overall flat. So where is that growth coming from? Are you seeing adoption in earlier lines of care?

Yes. Thank you for the question. Yes, as you know, we launched a national TV campaign late in the year around September, October time frame. And we've been pleased with the impact of that campaign. It did generate an inflection in new patient starts. And our analysis of the impact by media channel has enabled us to optimize our spend going into 2026. So we'll have more details to share on that impact as we get through the year. In terms of where the growth is coming from, we're pleased with efforts to expand use in primary care while also driving continued growth in psychiatry practices.

So we are seeing really nice growth across all segments. But primary care was the fastest-growing segment in Q4 in terms of new patient starts and new writers. And so we expect that to continue to be a trend as we expand our efforts in the primary care setting.

Next question is coming from Ram Selvaraju from H.C. Wainwright.

I was wondering if you could comment on what you expect ultimate reimbursement and market access to look like for AUVELITY at steady state, particularly in the context of how SUNOSI percentage covered lives is around 82%? Do you expect that to be similar for AUVELITY, particularly once the product is approved, both across MDD and chronic agitation or do you expect it to go meaningfully higher? And if so, what do you expect the ultimate optimal range to look like?

Yes. Thanks for the question. Our goal is to try to secure access for as many patients as possible across channels. And so although we don't typically guide on what the final steady-state covered lives percentage would be. I think you've seen for the past few years that we've made steady progress in terms of increasing copper lives. And our expectation is we'll continue to work to ensure access for both the MDD and ADA indications.

Your next question is coming from David Amsellem from Piper Sandler.

Coming back to AXS-17 and sorry if I missed any commentary here, but can you talk about how you're thinking about it beyond epilepsy, for instance, it's been about 20 years since something has been approved for generalized anxiety disorder and given the mechanism, it would seem that could be an interesting avenue to explore. So how are you thinking about broader development of the assets? And then secondly, just in general, are you looking at other assets to bring in to further leverage your infrastructure in both neurology and psychiatry?

As always, with any molecule, we look very carefully at the otology with an eye to what the possibilities are in terms of potentially affecting patients positively. So we -- as you know, we recently in-licensed the asset. Our focus right now is with regards to epilepsies, we will obviously look at other potential indications, but we want to make sure that we stay focused with the initial indication. We think that there's a lot of promise there in that area based on all of the preclinical work that's been done by others and also by our team. So stay tuned and stay tuned, and I think it's a little premature to talk about add-on indications to the primary indication.

Our next question is coming from Ash Verma from UBS.

So on the sales force expansion, a pretty big step-up twice versus the 300 reps that you had before? I'm just curious like what went into that math? And if you can talk about consensus SG&A for 2026 is only showing up 15% year-over-year. What would be the right range for the models?

Yes. Thanks for the question, Ash. So the sales force expansion is designed to accelerate growth in MDD while providing scale for a potential indication approval in Alzheimer's agitation later this year. So when you think about the expansion, the national hiring reps throughout the country to increase return frequency to the highest value HCPs across specialties will enable us to capitalize on the momentum that we've created in the primary care segment. And primary care is growing importance because of they are front-line treaters for both MDD and ADA.

And then finally, it will allow us to engage with an expanded target universe. So larger sales force allows us to engage with a larger group of HCP targets. When you think about the specialties that will be important for both indications, primary care, psychiatry and neurology are really the largest specialty segments that we'll be focused on.

Sure. Maybe just, Ash, Nick, maybe just a minute on OpEx and '25 to '26. So in 2025, in the P&L, we saw revenues growing roughly 3x faster than OpEx. So significant operating leverage in 2025. Even with this expansion with, the DTC that we've done and what we plan to do in 2026, we will continue to see that operating leverage throughout the year. Obviously, Q1, Q2, we'll be building that team, as you mentioned, going from 300 to 600, but this was always factored into our cash forecast. So continue to see operating leverage into 2026.

Your next question today is coming from Ami Fadia from Needham & Company.

My question is on SYMBRAVO. With the additional third commercial payer contracted in the fourth quarter. How do you see the overall coverage evolving through the course of this year? And how should we see that impacting the gross to net or the rate of pull-through of prescriptions as the year progresses?

Yes. Thank you, Ami. So as we mentioned in the call, we secured a contract with the third large GPO. And as you'll recall, the GPO contract is really the precursor or negotiating with payers and PBMs to suit our coverage. So although it doesn't guarantee coverage with the payers, PBMs, it does allow for active negotiation. And so our team is engaged in -- with all the national payers and PBMs. And I think we're optimistic about the potential to increase the SYMBRAVO coverage. That is something that we're focused on primarily for this year, and we'll share some additional updates as we secure access.

And maybe just a second on GTN. GTN in the quarter for Q4 was in that upper 70% range. We would anticipate that GTN to continue to remain elevated during the launch phase and as already shared, as more contracts come online, we believe that the GTN will be north of where AUVELITY currently is, but less than the GTNs that we see in the space.

Our next question is coming from Joseph Thome from TD Cowen.

Maybe just in terms of the potential Alzheimer's agitation launch, when will you be in a position to be able to launch the therapy after the April 30 date? Will it take some time before we could see kind of the full-fledged launch there? And then what sort of metrics do you anticipate providing should the approval come through would you be able to separate kind of product revenues between MDD and Alzheimer's agitation? Or how can we best monitor how that specific launch is going?

Thanks, Joseph. Yes, we'll be ready to go within a quarter on ADA. And obviously, the team right now is preparing every aspect for launch readiness. And so we're feeling really optimistic about the potential impact, if approved. And then in terms of metrics, we expect to share approximate percentage of scripts coming from the ADA space as we learn more. As you know, in the typical IQVIA or Symphony data does not break out by indication. And so we haven't finalized our plans, but we'll certainly be able to share some details about how the launch is going.

Our next question today is coming from Sean Laaman from Morgan Stanley.

On the pipeline, AXS-12, the NDA in narcolepsy, with the NDA submission plan for 12 in narcolepsy, how do you see differentiation versus existing therapies, particularly around cataplexy control and physician adoption?

Yes. Thanks for the question. As you know, narcolepsy is a challenging disease to treat and patients often are on polypharmacy, trying to find the right combination of medications to support symptom relief I think what's very clear is that not every patient responds to every mechanism in the same way, and there's a lot of trial and error. So from our perspective, AXS-12 offers a very compelling treatment option for patients, both in terms of cataplexy relief as well as safety tolerability profile. And so we feel very optimistic. It's a novel mechanism relative to what's in the marketplace today. And based on the feedback we've received in market research, there is high degree of interest in using this for narcolepsy patients.

Our next question is coming from Myles Minter from William Blair.

Congrats on the year. Just on AXS-17, just wondering how you're thinking about the therapeutic window there in epilepsy? I know that been out for should be less seditive than a benzo. But I think in the answer of AstraZeneca and their Phase II that did show a little bit of sedation in that generalized anxiety to sort of. So just wondering whether you're going to play around with dose to try and dial that out or whether the change in indication here is enough to make that an acceptable therapeutic window?

Yes. We are -- thanks for the question. We are exploring dose. And part of that exploration involves a lot of PK/PD modeling. We think that based on the preclinical data as well as the clinical data, there's a range of potential doses. And as you mentioned, depending on exactly where you fall and which therapeutic indication you might hit certain subsets of receptors. And the goal here is to make sure that we picked a dose where we have the best risk/benefit profile. Now the drug has not been studied previously in the clinical setting in patients with epilepsy. So there is some work there to be done and some information to be gotten from the initial trial in those patients. So stay tuned. This is what research is about, but we're very excited about the mechanism of action and the specificity of the receptor targeting.

Our next question is coming from Matthew Hershenhorn from Oppenheimer.

Congrats on all the progress. So we were thinking about the safety data for AUVELITY and ADA and just wondering how you see the likely label language upon the update reflecting differentiation risk facility based on what we saw in the clinical trials? And how do you think about the biggest advantages for AUVELITY once both treatments are available, especially considering the safety profile in elderly patients? Really appreciate it.

Matt, thanks for the question. The review is underway. And by the way, just a reminder, since it's a priority review or we're more than halfway through, and we we're just about 2 months out from PDUFA. So it's a little early for us to comment on potential label. However, what we can share is we -- should the product be approved, we'd expect the safety profile to be described in the label in that patient population. And we'd be pleased with that. And I think that's probably as much as we can say there. And could you remind me of the second part of your question, please, maybe Ari, you want to field that?

Yes. Just relative to the positioning, I mean -- so obviously, when you look at our clinical data, rapid onset of action, durability of response, low side effects and safety issues, not an antipsychotic option and currently approved as a monotherapy MDD, where there's significant comorbidity with Alzheimer's agitation. So we think that there's multiple elements of the clinical profile that will really help AXS-05 sort of stand apart. And there's a lot of excitement and enthusiasm about a potential launch amongst the Alzheimer's community.

Our next question today is coming from Joon Lee from Truist Securities.

Congrats on the quarter. This is [indiscernible] for Joon. Just a couple from us. So are you eligible for priority review for the AXS-12 NDA submission? And I just want to make sure I understand correctly. Nick, you're saying that the gross to net ability should actually improve after approval given the mega population?

Okay, I'll take the first part of the question. Thank you for the question. Our anticipation is that AXS-12 would be a standard review. So I hand it over to Nick for...

Sure. Yes, and correct, based on assuming that we see that 70% plus in the Medicare Part D channel for ADA scripts. If that's how it evolves, we would anticipate that the GTN would be more favorable as we're seeing currently in the Medicare Part D channel, that's more favorable than the commercial channel.

Next question is coming from David Hoang from Deutsche Bank.

So maybe just on the breakdown between the community and long-term care settings for ADA. Can you remind us how that breaks down and how you're planning to deploy your sales force to address those 2 segments? And then if Bristol's Coben fee should be approved for the adjacent indication of ADP do you think that could become a competitor in ADA such that the patients are being treated for ADP that might also address their agitation?

Yes. Thanks for the question, David. So as a reminder, about 60% of Alzheimer's disease agitation prescriptions are in community-based settings and 40% are in long-term care facilities. So it remains to be seen how the uptake of AXS-05 will be across those settings of care, but that is sort of how the market is behaving at the moment. And then in terms of your question on [indiscernible], we do view Alzheimer's education Alzheimer's psychosis as separate and distinct indications. And so we don't expect there to be much confusion in the marketplace and education symptoms are the most prominent and most burdensome for patients. And so there's significant opportunity, significant unmet treatment need and that will be our focus and launch approved.

Your next question is coming from Yatin Suneja from Guggenheim.

This Eddie on for Yatin. How should we think about the gross to net dynamics for ADA and how they're different from MDD? And then when looking at the valid penetration within the PCT market segment, can you talk about how big you expect that penetration to be versus the sort of more defined neuro segment?

Sorry, this is Nick. I answered the question already a couple of times on MDD versus ADA. We do anticipate in that ADA channel to be more positive, assuming that 70% plus would be in the Medicare Part D channel.

I'm sorry, could you repeat your second -- the second part of your question?

Yes. I was just wondering if you could talk about the overall penetration within the PCP segment versus the like more neurotic focused segment in MDD for ability?

Yes. It's a good question. And obviously, primary care is the dominant specialty in terms of overall volume because they tend to be the first-line treaters for MDD. That said, psychiatrists tend to have the greatest volume on a per patient basis and see the most patients overall. So we haven't specifically shared where we expect the final penetration to land in MDD. But as of today, we see about 1/3 of our writer base is in primary care, whereas 2/3 is in psychiatry. Primary care has been growing as we've expanded our sales team and continuing to penetrate the primary care segment. But where it will sort of end up at the end, is difficult to say at the moment.

Your next question is coming from Graig Suvannavejh from Mizuho Securities.

Congrats on the progress in the quarter and the year. My question is around the opportunity you see with AXS-12 for narcolepsy. I know there was a question earlier on differentiation, but maybe if you could frame the opportunity vis-a-vis the potential entry of the Orexin based products? I think this has probably been asked in the past, but just wanted to see how you are thinking of the potential impact on the orexins? Again, fully knowing it's a polypharmacy market, but just trying to size the market opportunity here.

Yes, as we shared before, this is a difficult patient population. There's a lot of trial and error. And I think although there's a lot of enthusiasm for the [indiscernible] agonist, I think there's also a recognition that not every patient is going to respond or necessarily get the same level of symptom relief across the spectrum of narcolepsy symptoms. So from our perspective, AXS-12 has very strong data within tax there's daytime dosing, which is a very appealing to patients and the potential impact across functional scores as well is something that we hear feedback is very promising.

I think in terms of how the orexins will stack up relative to other treatments, including remains to be seen. But our expectation based on feedback from KOLs is that they expect polypharmacy to continue to exist significantly even with the advent of new mechanisms of action in the space.

Yes, and if I might add to just as a reminder, in terms of mechanistically, how these agents work, as we know, narcolepsy is a disease where we do have a loss of orexin neurons and those directly stimulate the local rules, which produces northinephrine. So we target with AXS-12 norepinephrine, so it totally makes sense in a way both groups of products are targeting exactly the same pathway. And that's 1 of the reasons why we're very excited about AXS-12. It makes sense mechanistically and clinically, what we've seen is not only very profound effects on cataplexy, but also positive effects on sleepiness and also on cognition, which we've measured pretty extensively in the program and the clinical studies that we've done also based on the results from the long-term safety studies, these effects are consistent.

The other thing that we like about AXS-12 from a mechanistic perspective is the fact that a majority of patients with narcolepsy do suffer from depression and the mechanism of action of AXS-12 does kind of dovetail into that. So in a situation -- in a clinical situation where you do have a lot of comorbidities, it is helpful to have a drug with a mechanism of action which could potentially maybe impact the other diseases, which are neighbors of the primary condition. So we're really excited about the X12 and especially the fact that all these benefits are delivered with a very favorable safety and tolerability profile.

We reached the end of our question-and-answer session. I'd like to turn the floor back over for any further or closing comments.

Well, thank you, everyone, for joining us on this call. Axsome is in a unique position to continue to deliver innovative medicines at the frontier of neuroscience to patients and providers and through disciplined investment and performance across our commercial and development CNS portfolios, we expect to continue to generate significant value through the next decade and beyond, not only for patients but for stakeholders. We look forward to keeping you all updated on these important milestones ahead.

Thank you. That does conclude today's teleconference and webcast. You may disconnect your line at this time, and have a wonderful day. We thank you for your participation today.

Okay. Good afternoon, everyone. So continuing on day 2 of the Piper Sandler Healthcare Conference. This is David Amsellem from the Piper Biopharma Research team. So we're delighted to have Axsome with us. We have Mark Jacobson, COO; and Nick Pizzie, CFO. So thanks, gentlemen, for joining us. So we got a lot to talk about. So let's dive right in.

So -- yes, a couple of things, exactly. So I want to start with the filing for Auvelity and AD agitation. It's such a key topic. So just to start with any updates here? And just remind us for those who aren't as well versed on this particular topic, anything we should read into the absence of a priority review here in AD agitation?

Sure. So we're -- right now, we're waiting for an important decision. And that is the next update that we'd anticipate sharing. We had confirmed on our Q3 call in early November that the sNDA was submitted. That's good. So now we're waiting to provide an update there. The package is such that three positive trials has breakthrough therapy designation.

And our base case expectation is if it's accepted, it would be a standard review. And that's simply just due to kind of our read of baseline assumptions with happenings at FDA, right, resource constraints, bandwidth considerations. It's agnostic to our package. So that's our base case.

And look, we'll be pleased if it's being reviewed. We like the package we have. We think it from an efficacy, safety. I see it in a safety database perspective, it's a full package. So we feel good about that, and we'll have an answer soon.

So there's been a lot of handwringing over the last couple of years over one single study that didn't work, but you do have one randomized parallel group study that did work. You have two randomized withdrawal studies that also did work. So I wanted to get your thoughts on how this division views randomized withdrawal studies because it seems that every now and then it comes up is that enough, two randomized withdrawal studies plus the one successful randomized parallel group study. So why are randomized withdrawal studies perfectly appropriate for this development program?

Sure. There are -- first of all, from the very beginning, we've always needed two controlled trials. So we have three positive controlled trials. And feedback we have directly from the division is those trials can be a different paradigm. Okay, parallel group randomized withdrawal. So we have the direct feedback. There are also a variety of written guidance documents from FDA on trial designs and when trial designs such as randomized withdrawals can be appropriate for demonstration of substantial evidence of effectiveness.

And then you have the written guidance on substantial evidence of effectiveness where in that guidance, it states that different trial designs are better at controlling type 1 error than 2 studies of the same design. So you can sample direct feedback, written guidance, other written guidance, and it's all consistent in terms of different trial designs being acceptable.

And what we feel good about is we have more than that, right? So we have three positive studies. We have long-term data. We have a stand-alone ICH safety database and now that's getting into safety and tolerability, but the package itself is robust, and we feel good about that.

Yes. Let's turn to the commercialization plans. In AD agitation. So I don't know if you can tell us how many reps you plan to launch with and how that label expansion synergizes with your current commercial infrastructure. But just if you can talk about that. And also the size of the target prescriber audience, that would be helpful.

Sure. Maybe I can take a little bit of that first question. So currently, we have 300 reps -- roughly 300 reps that are detailing for MDD. Upon an approval, if an approval, we will have those reps detailing both MDD and in ADA. Additionally, we're planning to do an expansion upon an approval. That expansion, we're not looking to double the size of the field force, but we will have a meaningful size expansion, recognizing the peak sales opportunity of $1.5 billion to $3 billion in ADA alone.

As a reminder, MDD, we've shared $1 billion to $3 billion in MDD alone. So $2.5 billion to $6 billion in totality. So we would look to further expand the team in the general practitioners as well as in psyches. Additionally, what we do plan to have is a long-term center discrete field force team. The reason why it's discrete is it's more -- it's a different type of approach. It's more of an account management approach. So we would have a dedicated team that would also call in detail on ADA as well as MDD.

As a reminder, we're currently not even in LTCs. There is a significant comorbidity between MDD and ADA. So we would expect in the MDD indication, it would have a, let's call it, a halo effect as it -- as we get the indication for ADA, we'll see a further acceleration of scripts as it relates to MDD because -- it's an untapped market for us...

How much -- yes, sorry, go ahead, Mark.

Yes, I was just going to touch on your question about targets.

Yes.

That work is being done right now. There is high overlap with the clinicians, where HCPs that we're calling on right now, which is great. The final kind of analysis, rounding out that analysis is still underway. The primary focus will be in a community dwelling setting and that final analysis will then inform the numbers we're targeting for expansion.

And David, maybe just one last point on commercialization because market access plays a key point in commercialization. So for Auvelity currently, we have 100% access, 100% covered lives in the government channel, 75% in the commercial, so overall 85% total covered lives. We expect the majority of the scripts to be in the government channel. So we would be going in with a launch with 100% access for covered lives. And that access, we feel is high quality.

How much of the AD agitation opportunity is bound up in the LTC setting? I mean is it 10% of the market, 20% of the market? I mean how do you think about that?

It's probably around there. We haven't -- I mean there are different considerations. We think the majority of the market is in community dwelling setting, and that's the ballpark that we see in terms of relevant or meaningful opportunity for AXS-05 should it be approved for the indication. And because of that, that Nick alluded to or touched on that we plan to expand or that the expansion -- the field force expansion would have a discrete kind of arm or unit that's solely focused on long-term care facilities. We'll have more to say in the months ahead if the product is approved.

Can you talk through the kinds of patients who would profile as early adopters of Auvelity and agitation with Alzheimer's. I mean there's a lot of off-label usage of reuptake inhibitors. So are these -- are you going to mainly target patients who are not seeing adequate benefit frontline usage of reuptake inhibitors? Or is it really just -- look, there's only Rexulti, and that's it in terms of what's approved. So you could cast a wider net.

Definitely, that's from the access perspective, right, in terms of coverage and coverage considerations. So there's really only one product approved. In terms of patient profiles or maybe prescribing decisions, the feedback we have from KOLs is that they anticipate this being a potential first-line agent, which makes sense to us, right? So the different tolerability profile, we did not see a mortality signal. We did not see a false signal.

We did not see cognitive decline. Those are all great elements of a product profile or very meaningful and differentiated. The -- so we'll see, but there's the clinical considerations and the access considerations. And they, in this case, line up very well from an opportunity perspective. So we are not -- the strategy is not to focus on, say, a certain type of inadequate responder.

Yes. And let's move over to MDD for Auvelity. So you did launch a DTC campaign. Walk us through the scale of that campaign and how that could move the needle for the product in MDD next year?

Yes, sure. So we launched the DTC campaign, national TV campaign in the beginning of September. So it's now been live for roughly 3 months. I'm pleased with the performance. I think the best indicator that the Street can see and that we're also looking at is NBRxs. So maybe taking a step back to the beginning of the year, where we saw NBRxs was right around 2,000 NBRxs per week. We then expanded the team by roughly 40 reps from 260 to 300.

We saw the NBRxs expand from 2,000 to 2,500 NBRxs per week. So that was really in Q2 and Q3. As I said, we launched a DTC campaign in September. And now we're seeing NBRxs ramp up further to roughly around 2,750. We've hit north of 2,800 on some weeks. So we've been pleased with the performance. We would expect that to continue to grow. I think we're probably in the early to mid-innings as it relates to seeing that from an NBRx perspective.

And we're looking to run the campaign. What we've shared to the Street is through the end of this year. We will have some type of DTC campaign continuing through 2026. But when you launch a DTC campaign, it's really heavy in the first few months to get that brand awareness out there, and then there will be a maintenance throughout 2026 for that campaign.

Is there going to be DTC targeted to Alzheimer's agitation, caregivers, particularly?

At the appropriate time, we think it's -- we'll have the space, and we'll be able to utilize that accordingly and transition as we see fit between MDD and ADA.

Yes. I think you know us, we prefer a very data-driven, disciplined but optimistic investment approach, and that will carry through to what we're doing. And for us, it's an ROI analysis. And we still see a ton of meaningful ways to invest in addition to DTC.

Yes. When I think of DTC, particularly in major depressive disorder, I tend to look at it as kind of a permanent fixture of patient activation and just something you just kind of have to do throughout the commercial -- is that how you look at it for Auvelity? And I know you've taken a different approach than big pharma when it comes to a psychiatry launch. But do you look at DTC for Auvelity as sort of, okay, this is a permanent fixture of commercial support?

The commercial teams often talk about this as surround sound, right? And what we're mindful of is you don't want surround sound to turn into background noise where people tune it out. So you want to be very -- we want to calibrate that. And so you'll see adjustments there. But I think ultimately, yes, the answer is we're investing in that arena now. So you could expect continued investment, which could fluctuate depending on where we see the opportunity.

Okay. So let's talk about the role that Auvelity has in MDD. Maybe talk to the split between second and later line usage versus potentially first-line usage in MDD. And also, do you have a good read on the split between monotherapy and adjunctive usage?

Sure. Just the numbers real quick. Monotherapy, it's now tracking over 50%, which is great, and that makes sense to us. We can talk about that in terms of more prescribing or increased prescribing in primary care setting. And then in terms of line of therapy, we're seeing now north of 15% first line, so in the episode and it's about 35% for switch, so second line, which is great. And we expect those numbers to continue to grow in line with the expanded sales force, DTC, market access wins.

Yes. And then I can't get through a fireside without asking about gross to net. So...

I was hoping you were going to ask...

No, I was going to lead it, but...

Return of favor.

You want me to run through it?

Sure.

Yes, great. So we were in the mid-50s for Auvelity in Q1 and Q2. We improved in Q3 to the high 40s. And not only do we improve to the high 40s, but we also added 28 million additional lives and those lives were high-quality coverage, so mostly first line and first switch.

So basically a hatrick of adding lives, quality of lives and net price improvement. So really pleased with that. We shared Q4, potentially a slight uptick into the low 50s from the high 40s. That's just around the last two weeks of sales that we have. Those sales are in our pipeline as of year-end. They would get adjudicated in Q1 -- first 2 weeks of Q1. So we just have to accrue for that. That's where we're just guiding that there may be a slight pickup in GTN in Q1 from Q4.

Yes. And when ADA gets into the label, I mean, that's exclusively -- almost exclusively Medicare population. So how does layering in that impact the overall blended gross to net of Auvelity?

Sure. So again, 100% coverage in the government channel, ADA indication would inherit the current access that MDD has, which is high-quality coverage in the Medicare Part D channel. That potentially could further improve our GTN if and when it is approved.

Yes. So I want to switch gears to SYMBRAVO. Just talk qualitatively how you feel about the launch. I know it's early days.

Early days, what we look for, first and foremost, is feedback from clinicians. And we like what we're hearing and -- or we like the feedback we're getting, which is the product profile is differentiated from an efficacy perspective.

The need is increased efficacy versus available therapy and clinicians are reporting patients are having that experience. And also that the tolerability profile is good with respect to that, meaning that oftentimes, the classic AEs that you see with standard of care triptans that patients are not reporting those same types of AEs, rebound headache, migraine or medicine overuse headache. And so that's great.

So we want to keep driving trial. And that's the team's job. We're calibrating it. We're focused on headache centers. additional learnings there are being pulled through into other targets as well as calibrating patient support and patient savings.

Yes. So this is kind of another gross to net question. But really, this is more about access with SYMBRAVO I mean the migraine space is -- acute migraine it's crowded. It's fairly tightly controlled by payers. So with all that in mind, how do you think about access? What do you think that's going to look like steady state? What do you think the gross to net is going to look like steady state for SYMBRAVO?

Sure. The team is working on that, you know. We've improved from Q2 to Q3, we're around 50%, I think 52% total covered lives. We would anticipate that number to continue to grow. From a GTN perspective, what we've shared publicly is that we would expect it to be somewhere between Auvelity and where the Gepants are, the Gepants being somewhere in that 70% range.

We shared, I think, that in Q3 that we were in the 70s. So we're being mindful. We have a long runway here with exclusivity. So again, similar playbook that we took with Auvelity that we're -- we want to obviously improve lives, but we also want to be mindful of what our total net price is further down the road.

So I want to talk about commercial support of SYMBRAVO. Just give us a lay of the land in terms of the target physician audience, the mix between migraine specialists, general neurologists, maybe other practitioners. And then just help us understand the kind of investment you're putting behind the commercial team for SYMBRAVO.

The primary focus is headache centers. There are about 100 to 150 in the U.S. and those are, of course, the primary HCPs there, are headache specialists. So that's the focus in the early days and for the foreseeable future that will expand as additional lives come online, as we hit the grooves that we're looking for with respect to patient support and patient savings dynamics. We had -- go ahead.

I was just going to say we went out of the gate as a reminder, with 100 reps. A number of our peers have launched with 550, 600 reps, specifically in the Gepant space. So being mindful that we have a discrete team focused on headache centers, as Mark was sharing. And I think it's been a bit of a binary with those headache centers the success.

So we've had success with certain headache centers, and we're seeing great traction and great qualitative and quantitative feedback from those headache centers. And others, we're continuing to knock on the doors and work through those institutions. So it's -- we're playing the long-term game here with those institutions.

Okay. Let's switch gears and talk about pipeline. So solriamfetol, you have a number of studies. So there's pediatric adolescent ADHD, there's MDD with EDS, there's binge-eating disorder, there's shift work disorder. So lot of deliverables. So just help level set for us, can you say when these studies will or initiate if they haven't done so? And just talk through data time lines across these various studies.

Sure. Solriamfetol, we're really excited about the potential of that product candidate in a number of settings and CNS setting, psychiatry in particular. That's based on KOL feedback for how patients do globally. So it's approved for excessive daytime sleepiness in narcolepsy or associated with obstructive sleep apnea. And we've launched, as you mentioned, a very broad development program in one related indication that FDA considers related, that shift work disorder. And because of that, if that -- if the current study is positive, then we'd anticipate being able to file with that one study because the current data could serve as potential supportive evidence.

So we're excited there, and that makes sense in terms of what the drug is currently approved for. That study is underway, and we've guided to top line next year. There are -- is the ADHD program. Very excited about that from mechanistically, and we have one positive Phase III trial in adults. We need to run FDA, the psychiatry division requires pediatric adolescent data in any submission because they assume any product approved for ADHD would be used in peds adolescents.

So that study needs to read out and be positive for us to submit, and we guided to starting that study this quarter. Other programs, MDD with symptoms of excessive daytime sleepiness. We have one proof-of-concept study in MDD that we ran. We reported that earlier this year, saw the signal in this patient population. So this is a precision-based approach to depression -- treating depression. And this would be for the treatment of depression. So it would not be for the treatment of excessive daytime sleepiness in individuals with depression be the other way around.

That study we guided to starting this quarter. And so that's ADHD, shift work, MDD and then there's binge-eating disorder, which is -- that study is underway now. We like that, again, mechanistically, feedback from KOLs. And you can see that related to ADHD, there's pathways related to impulse control that we think are relevant and of interest here. And we've guided to top line for that trial next year as well.

So you can expect to start to -- I think you'll have continued updates from us as we typically do on a quarterly basis. And then as things crystallize or occur, we'll provide stand-alone update. So it's a very, very busy time. We're really excited about the business, in particular, solriamfetol as the overall potential of that product candidate.

Just to be clear with solriamfetol, to the extent you have the adult study and the adolescent ADHD studies, and it's already approved, you could just file on those two studies, you don't need any additional longer-term data?

Oh, I see. Yes. No, that's our expectation. And so there will, of course, as we're running studies, be safety data that will go into it, but we're not planning, say, as we did for AD agitation, a stand-alone a full ICH safety database, -- that's not planned.

So you did in-license a selective GABAA Alpha 2/3. That's a positive allosteric modulator that's from AZN. So how are you thinking about the value proposition in epilepsy. But I think of an agent like that, and I think, well, you certainly can explore it in psychiatric indications. So how are you thinking about it?

We're thinking deeply about it right now. The -- it's pretty exciting in terms of -- for the business, we have three commercial products in various stages of launch, which is excellent. We're executing there. There are two NDA stage programs, which is great. And then multiple Phase III programs, some of which have at least one positive trial to date. What -- and that's fantastic. The business has never been stronger.

The earlier-stage pipeline, we are taking an opportunistic approach to adding to that when there are things that come across our radar that we think fit. In this case, GABAA PAM, we think it's a really interesting mechanism. And the preclinical work it's already underway at Axsome in terms of looking at anticonsultsant activity. We see that. Some prior work was already done with the molecule.

So next steps here are Phase II enabling work, indication selection. So we'll get that done. And then beyond that, I think we'll start there. And -- but you're right, mechanistically, it's very interesting. And another reason we move forward with that is there are -- some of the development team has deep expertise in epilepsy already. So that's kind of an underused part of our collective brain, which we're excited to use, and we can use it because it's earlier, it doesn't distract from other elements of the business and executing. So we're excited to provide updates there.

All right. More to come. Well thanks, Mark. Thanks, Nick. Thanks everyone in the audience.

Okay. Thanks David.

Good morning, and welcome to the Axsome Therapeutics Third Quarter 2025 Earnings Conference Call. My name is Daryl, and I will be your operator for today's call. [Operator Instructions]

Please note that this call is being recorded. I would now like to hand the call over to Darren Opland, Senior Director of Corporate Communications. Please go ahead.

Thank you, Daryl. Good morning, everyone. Thank you for joining us for Axsome's Third Quarter 2025 Earnings Conference Call. With us today are Dr. Herriot Tabuteau, our Chief Executive Officer; Nick Pizzie, our Chief Financial Officer; and Ari Maizel, our Chief Commercial Officer, who will begin our call with prepared remarks. Mark Jacobson, our Chief Operating Officer; and Hunter Murdock, our General Counsel, will also be available for Q&A.

This morning, we issued our press release providing a business update and detailed financial results for the quarter. I encourage everyone to visit the Investors section of our website to find the press release accompanying presentation to today's call.

Please note that today's discussion includes forward-looking statements regarding our financial performance, commercial strategy and operational plans, including research, development and regulatory activities. These statements are based on current expectations and assumptions and are subject to risks and uncertainties that may cause actual results to differ materially.

Please refer to our SEC filings, including our quarterly and annual reports for a description of these and other risks. You are cautioned not to rely on these forward-looking statements, which are made only as of today, and the company disclaims any obligation to update such statements. And now I'll turn the call over to Herriot.

Thank you, Darren, and good morning, everyone. Axsome continues to lead in CNS innovation driven by disciplined execution and a clear focus on sustained growth and value creation. In the third quarter, we delivered strong revenue growth with total revenue of $171 million across our 3 marketed products, representing a 63% increase year-over-year. .

AUVELITY continues to gain traction as a differentiated treatment for major depressive disorder, driven by strong underlying demand. We're pleased with the pace of AUVELITY's performance, which is tracking well against our long-term expectations underscores the significant opportunity for continued growth ahead.

SUNOSI remains on a steady trajectory with year-to-date sequential growth nearly double that of the same period last year, a testament to the product's durable performance and expanding adoption. SYMBRAVO completed its first full quarter of commercial launch in Q3. Our focus now is to continue strengthening the foundation for long-term success by broadening patient access and driving awareness with clinicians.

Nick and Ari will speak in more detail about our financial and commercial performance and the strategic execution driving momentum across Axsome's portfolio. Beyond our continued commercial growth, Axsome's R&D engine is advancing a robust pipeline of late-stage programs with the potential to deliver transformative therapies for patients and significant value to our shareholders.

Over the coming months, we expect meaningful activity across our late-stage programs, including 2 NDA stage programs and multiple registrational trials underway or initiating. I'd like to start with our top priority areas in psychiatry and neurology, Alzheimer's disease agitation, narcolepsy and ADHD. These are areas where we see substantial opportunity to transform patient outcomes, leverage our commercial infrastructure and unlock significant value.

First, we are pleased to share that we have submitted our supplemental NDA for AXS-05 in Alzheimer's disease agitation. And we look forward to announcing the FDA's decision on acceptance of the filing. This submission is an important milestone for AXS-05 and for the millions of patients and caregivers affected by the serious and underserved condition.

The addressable market falls Alzheimer's disease agitation is substantial and the unmet need is high with currently only one product approved. AXS-05 represents a first-in-class mechanism of action that has the potential to set a new standard in the treatment of AD agitation.

Work is already underway to efficiently scale our commercial platform to deliver an impactful launch if approved. As a reminder, we are also developing AXS-05 in smoking cessation, and we are on track to initiate a Phase II/III trial in this indication this quarter.

Our next pipeline priority area is narcolepsy. We continue to target the submission of our NDA for AXS-12 for the treatment of cataplexy in narcolepsy in the fourth quarter of this year. AXS-12 represents a highly differentiated opportunity to address critical gaps in current treatment. Up to 70% of patients suffer from cataplexy and many continue to experience inadequate relief or for tolerability to existing treatment options.

We are excited about AXS-12 potential to make a meaningful difference for patients living with narcolepsy. We also like its strategic fit with our existing sleep franchise, which we anticipate will enable highly efficient and synergistic launch, if approved. For ADHD, solriamfetol has demonstrated positive results in adults in the FOCUS Phase III trial completed earlier this year. The next step is a Phase III trial in children and adolescent, which we plan to initiate in the fourth quarter of this year.

If successful, this indication could substantially expand the opportunity for solriamfetol beyond its currently approved indications. As a reminder, we are also developing solriamfetol in 3 additional indications, MDD with excessive daytime sleepiness, binge eating disorder, and shift work disorder. For MDD, we sleep initiation of a Phase III trial in adult with MDD with excessive daytime sleepiness this quarter.

Next year, we expect top line results from the ongoing ENGAGE Phase III trial in binge eating disorder and the SUSTAIN Phase III trial in shift work disorder, and we look forward to providing progress updates in the near future.

Turning to AXS-14, we are finalizing preparations for our planned Phase III trial in fibromyalgia, which we expect to launch before year-end. These milestones highlight the continued expansion of Axsome's leading neuroscience pipeline, spanning multiple psychiatry and neurology indications with significant unmet medical needs and substantial long-term growth potential.

All in all, our portfolio of novel medicines is robust and diverse and our late-stage pipeline is deep and rapidly advancing, uniquely positioning Axsome to deliver substantial near- and long-term value through multiple highly differentiated paths.

With just 3 years as a fully integrated R&D and commercial organization, Axsome is shaping the frontier of differentiated innovation in brain health. The fundamentals of our business have never been stronger, and we are excited to continue building on this foundation to drive further growth.

With that, I'll hand the call over to Nick to review our financial results for the quarter.

Thank you, Herriot, and good morning, everyone. Our third quarter performance underscores the continued momentum of Axsome's commercial portfolio and the breadth of our capabilities as an organization. We continue to advance multiple in native therapies addressing diverse and critical needs in brain health, a foundation that is driving meaningful growth across our entire business. As Herriot mentioned, total product revenues for the quarter reached $171 million, representing a 63% increase year-over-year.

AUVELITY continues to demonstrate impressive growth. Net product sales for the quarter were $136.1 million, up 69% versus last year. SUNOSI net product revenues for the quarter were $32.8 million, up 35% versus the prior year. SUNOSI revenues consisted of $31.6 million in net product sales and $1.2 million in royalty revenue associated with SUNOSI sales in out-licensed territories.

SYMBRAVO, in its first full quarter on the market generated $2.1 million in net sales. These results reflect our continued top line growth and focused execution, driving increasing operating leverage across the business. AUVELITY and SUNOSI gross at discounts for the third quarter were both in the high 40% range. We anticipate that AUVELITY and SUNOSI gross to net discounts will increase in Q4 to the low 50% range.

SYMBRAVO gross to net discount for the quarter was in the mid-70% range, which we anticipate will remain elevated during launch phase. Turning now to expenses. Total cost of revenue were $11.9 million compared to $8.4 million for the third quarter of 2024. Our research and development expenses of $40.2 million decreased 11% compared to last year, primarily driven by the completion of our clinical trials for solriamfetol in ADHD and MDD.

Our selling, general and administrative expenses of $150.2 million increased 57% compared to last year, primarily driven by commercialization activities for AUVELITY including the sales force expansion and our recently launched direct-to-consumer advertising campaign, along with the commercial launch of SYMBRAVO.

Our net loss for the quarter was $47.2 million or $0.94 per share compared to a net loss of $64.6 million or $1.34 per share for the same period last year. The $47.2 million net loss this quarter includes $23.1 million of noncash stock-based compensation expense and a $13.2 million noncash charge related to contingent consideration.

We ended the third quarter with $325.3 million in cash and cash equivalents compared to $315.4 million at the end of 2024. We continue to believe that our current cash balance is sufficient to fund anticipated operations into cash flow positivity based on the current operating plan. And with that, I'd like to turn the call over to Ari, who will now provide a commercial update.

Thank you, Nick. Q3 represented Axsome's first full quarter with 3 products, and our commercial team advanced efforts across multiple fronts of Axsome's commercial business highlighted by strong performance for AUVELITY, a foundational first full quarter for SYMBRAVO and steady growth for SUNOSI. AUVELITY's momentum in major depressive disorder continues to build with strong prescription growth increased new activation and the initiation of strategic commercial investments.

For the quarter, approximately 209,000 prescriptions are written for AUVELITY representing 14% year-over-year growth and 9% sequential growth. By comparison, the antidepressant market grew 1% year-over-year and was flat versus the second quarter of 2025. Since our expansion of the psychiatry sales force earlier this year, average weekly new-to-brand prescriptions, or NBRx, have increased by approximately 35%. Our expanded team continues to drive broader and deeper engagement across prescriber segments, and we have made meaningful progress in the primary care setting.

Approximately 1/3 of AUVELITY prescribers are primary care clinicians and NBRxs from the primary care setting have increased by approximately 50% since the expansion. Approximately 5,000 new prescribers were activated this quarter, bringing the total number of unique prescribers to 46,000 since launch.

In addition to strong demand growth, we continue to make progress with market access for AUVELITY. Commercial coverage increased from 73% to 75% this quarter, bringing total coverage to 85% of all lives across channels.

Importantly, we have also contracted with a third large commercial group purchasing organization or GPO effective August 1, which will support continued coverage efforts moving forward. Turning now to SYMBRAVO. The third quarter marks SYMBRAVO's first full quarter on the market with early progress that is helping to establish a strong foundation for long-term growth.

More than 5,000 prescriptions were written and over 3,300 new patients started SYMBRAVO in the quarter. Our targeted approach, including focused sales and marketing activity among headache specialists who drive the majority branded migraine prescriptions, is effectively building awareness and driving traffic.

Feedback from patients continues to reinforce SYMBRAVO's robust clinical profile. SYMBRAVO's mosaic technology, which enables rapid absorption while maintaining our long half-life resulting in strong efficacy is resonating with HCPs.

In a recent survey of migraine treaters, key drivers of prescribing include SYMBRAVO's multi-mechanistic marketing of the CGRP and prostaglandin pathways migraine symptom relief, improvements in patient functioning and sustained freedom from migraine headache. We continue to make progress with SYMBRAVO market access and coverage with overall payer coverage at approximately 50% of all lives as of October 1.

The proportion of covered lives in the commercial and government channels is 48% and 56%, respectively. We have also contracted with a second large GPO effective August 1 for potential coverage of SYMBRAVO. We anticipate coverage for SYMBRAVO to expand and evolve throughout the balance of the year and into 2026.

And finally, SUNOSI delivered another quarter of strong and steady performance with approximately 53,000 prescriptions representing 12% year-over-year and 5% sequential growth. By comparison, the promoting agent market grew 4% year-over-year and 3% quarter-over-quarter. More than 460 new clinicians prescribe SUNOSI in the quarter, bringing the total cumulative prescriber base to approximately 15,100 since launch. Payer coverage for SUNOSI remains at approximately [ $0.83 ] of lives covered across channels.

Overall, the third quarter represented another period of strong commercial performance across Axsome's growing portfolio of differentiated CNS products. With continued execution on AUVELITY and SUNOSI and the establishment of the growth foundation for SYMBRAVO, Axsome is driving increased demand, growing prescriber and patient engagement and expanding access to our products. We remain confident in Axsome's continued growth potential and look forward to sharing future updates on our commercial progress.

I will now turn the call back to Darren for Q&A.

Thanks, Ari. That concludes our prepared remarks. Daryl, please open the line for Q&A. .

[Operator Instructions]

Our first questions come from the line of Leonid Timashev with RBC Capital Markets.

Congrats on the quarter. I actually wanted to ask on SYMBRAVO and your ability to extrapolate what you're seeing in the third quarter out to fourth quarter in 2026. I guess maybe can you talk about the increased depth of prescribing you're seeing and maybe what you'd like to see on the ground before you invest more in the launch and potentially in areas of bottlenecks that are stopping additional patients from coming on therapy?

Leon, thanks for the question. It's Ari. Obviously, it's still very early in the SYMBRAVO launch. And our -- what we're seeing so far is very positive in terms of HCP and patient response. The drug is performing as well as we expected in the real-world setting. We are, as a reminder, we've taken a very targeted and focused approach, focused on the top 150 headache centers as well as large neurology practices around the country. .

And our intent is to try to penetrate as many of those providers as possible. And as we observe the impact, we'll make further decisions around expansion or incremental investment for SYMBRAVO. But at this time, we're really pleased with the early response. There's a lot of work to do, and we're in the early days. But we are really focused on increasing prescribing in our targeted clinicians. You mentioned earlier, we've seen improvements in market access, which is also a key area of focus for us. and we'll share additional updates as the brand progresses.

Our next questions come from the line of Marc Goodman with Leerink Partners.

This is Basma on for Marc. We have a question on AUVELITY regarding the primary care segment, which seems to be contributing more and more to the scripts right now. Do you see this segment as a key growth driver for AUVELITY? And how do you envision growing this segment? Is it mainly through sales force expansion? That's it for us.

Yes. Thanks so much for the question. Yes, we believe primary care is a really important specialty area for AUVELITY in MDD is largely because most patients in the U.S. present to a primary care office upon diagnosis and many stay with primary care throughout the course of their depression episodes.

As you mentioned, we are seeing very positive response in the primary care setting. It now represents roughly 1/3 of our subscriber base and we're seeing strong performance in terms of the patient starts as well as overall prescriptions.

In terms of how do we further grow the primary care segment, part of that is just our -- our focus sales force effort. Obviously, we've expanded the team several times, and that has enabled us to reach more primary care clinicians on a routine basis.

We believe the expanded market access that we've been able to accomplish over the past couple of years is also helping to ease the prescribing path for a primary care treater that may not have as many resources to support PA processing. And then finally, our direct-to-consumer campaign, which launched in the quarter, we're seeing early positive signals in terms of patient awareness, patient requests for the product, and we expect that to facilitate further growth in the primary care setting, along with the psychiatry setting.

Our next question comes from the line of Pete Stavropoulos with Cantor Fitzgerald.

Congrats on the quarter. There is a clear distinction in the clinical profile of AXS-05 versus antipsychotic, given the differences in clinical data for Alzheimer's agitation and the mechanism, what are your expectations for AUVELITY adoption, if approved? And how do you plan to drive uptake in the various channels? And have you identified key elements from AUVELITY commercialization and marketing strategy, you would do differently to ensure a greater uptake in success?

Yes. Thanks for the question. Obviously, we're very optimistic about the impact AXS-05 can have on the Alzheimer's agitation market. In terms of our focus area, what we have seen in our early launch preparation is that there are a mix of specialties that are treating agitation. Primary care is the largest -- they're also geriatric psychiatrists, neurologists and then traditional psychiatrists. Of course, long-term care is an important setting of care for Alzheimer's patients.

And our anticipation is that we'll cover all of those different specialties and settings of care with our efforts.

We see a high degree of overlap between Alzheimer's agitation and major depressive disorder in terms of prescriber base. And so we'll be able to leverage our existing sales force. We see high synergies related to promotion there. And of course, we will need to invest in long-term care promotion, which is something we don't currently have, but do anticipate bringing online if the drug is approved.

In terms of Rexulti's promotion, our -- we don't typically comment on other companies in their promotional mix. But we have been following along and they're having really nice success with Rexulti. And so there are some learnings that will incorporate into our launch strategy if an excessive fund is approved.

Our next question comes from the line of Sean Laaman with Morgan Stanley.

I'm just wondering on the sales force expansion. I think you just mentioned on the call, you're up to 46,000 prescribers added 5,000. Given the bump in SG&A, I'm wondering how much capacity you think you've got in the existing sales force? And when you might have to go again and how that ties into your thinking about the time to cash flow positivity?

Yes, I'll take the first part of the question. We are pleased with the size of our sales force at the moment. It is driving considerable growth in terms of new prescribers as well as new patients. We previously shared that we intend to add some additional representatives support of the Alzheimer's agitation approval and we have started our efforts in terms of laying the groundwork for future expansions although we have been quite settled on a final number. That is something that we're looking to do early in 2026.

Yes. Maybe just a little bit on the SG&A for the quarter. This is Nick. So in Q3, the SG&A increased slightly. That was really driven by our launch of the DTC campaign that we launched in September. Additionally, we had a full order of commercialization activity for SYMBRAVO. So even with that, if you take a look at our net loss on a cash basis, we continue to improve quarter-over-quarter as well as on a GAAP basis, continue to improve on the net loss. So no changes as it relates to our outlook for cash flow positivity.

Our next question comes from the line of Ash Verma with UBS.

Just on the AD agitation application. Can you comment on how many days past you are after the application filing? Are there some investor discussion going on whether you're past the 60 days and that's unlikely to get a priority review? And any implications that you can draw from the government shutdown to your filing application process review and how this may play out?

Sure. Ash, so as is our practice, we haven't disclosed the data of the submission, but the FDA typically let sponsors know say, up to 748 following the submission when on a potential acceptance, we don't see any potential impact from the shutdown for the timing. So we'll -- as we said, the next update that we expect to share as potential acceptance decision.

Our next question comes from the line of Andrew Tsai with Jefferies.

Great execution this quarter. Maybe shifting gears to the pipeline. You've got 2 Phase III readouts with SUNOSI for binge eating and shift work disorder. So can you talk a little bit about the study designs, what positive data would entail for -- in order for you guys to 2 more sNDAs next year or 2027?

Sure. As it relates to binge eating disorder, it's our standard parallel group study design. And that would be the first study that we would need in order to be able to file an sNDA. So then based upon the results of that study, we would intend to initiate another trial, so we would need 2 studies for that. Other indications for solriamfetol include ADHD and where we currently have 1 positive Phase III trial for that in adults, and we're looking to start our second study, which would be in pediatric subjects or patients in the fourth quarter.

Our next question comes from the line of Ami Fadia with Needham & Company.

My question is just sort of broader stepping back. You've got a couple of products in the market, making a way towards cash flow positively and several other late-stage assets. sort of from a long-term strategic perspective, where are you in terms of your thinking around the portfolio?

Are you looking to add additional assets to drive sort of operational efficiencies over the next couple of years? Or do you think that you've got enough in late stage that focuses really more on execution on those assets?

Thank you for the question. We're in a very -- we're in a unique position from the perspective of, as you mentioned, we do have 3 marketed products which are still in relatively early stages of launch. So there's a lot of growth ahead. And we're very fortunate that the period of exclusivity for these products goes out into the next decade or a couple of decades.

So that's a great position to be in. And on the back of that, there is the next wave of products which we would -- products and indications, which we would expect to be approved over the next couple of years. We talked about the SNDA filing for Alzheimer's disease agitation and the planned in the filing for AXS-12.

And then of course, there's AXS-14 for which we intend to launch our next Phase III trial. So all of that means that we really do not need to do anything extra as it relates to the pipeline in the near term. But that would be, I think, the standard approach -- and our approach is always to make sure that we're ahead of the curve. And so as it relates to that, we are taking the opportunity of the position that we're in to field inbound as it relates to potential additions to the pipeline, which could be complementary.

So we're not going to quit where we're ahead. and we'll continue to make sure that we make very good strategic decisions as it relates to potentially enhancing the pipeline, and we're in a position whereby we can be very choosy about what we burn on board.

Our next question comes from the line of David Amsellem with Piper Sandler.

I had a question on reboxetine. Wanted to get your latest thoughts on how you're thinking of the commercial opportunity, particularly given that you'll be entering the market more or less around the same time as ovaperexin the first receptor agonist. So how are you thinking about the competitive dynamics here? How are you thinking about sizing this opportunity? Just wanted to get your latest thoughts on the product.

Yes. So I think we'll all tackle that. One thing which is really interesting about reboxetine is its focus on reuptake inhibition. And that is a common pathway for the orexins. So the pathophysiology of the disease is orexin neuron loss, then decreases the production of. And so then -- so we -- this is the reboxetine team works in very logical, rational way in terms of the pathophysiology of the disease. So we're very excited about the product profile because we know from our experience in the sleep space with SUNOSI that they're still very high unmet medical needs. .

I'll just add, when you look at the clinical profile that was observed in the Phase III trials, efficacy and cataplexy nonstimulant daytime treatment, favorable tolerability profile, a lot to like about it and what we hear from KOLs and sleep experts is that many patients require a pharmacy. There's a lot of trial and error. And even with the entry of a mechanistic approach, we believe that there will still be significant unmet need, which creates opportunity for AXS-12 in those patients.

And maybe just one other at is with respect to sizing, we see incredibly high synergy, almost near perfect energy with the current sales and marketing infrastructure that we have in place for SUNOSI right now. So very, very very complementary to what's already in place. So we're excited about that.

Our next question comes from the line of Joon Lee with Truist Securities.

Congrats on the strong quarter. Your commercial execution on SUNOSI is quite impressive. Any idea where the demand for SUNOSI coming from? Is it NT1, NT2 or something else? And given your strength in combining products, any thoughts on combining SUNOSI with AXS-12 to adjust both EDS and cataplexy or do you think it's just better to keep them a la carte?

Yes, I'll take the first part of that question. We're seeing sort of -- the predominant growth is coming from the OSA segment. There is significant unmet need in terms of excessive sleepiness with OSA inpatients. It represents roughly 2/3 or so of the overall prescribing for SUNOSI, and we are seeing very strong demand for SUNOSI with those patients. .

Narcolepsy, of course, is an important component of the SUNOSI sales mix, but what we've seen particularly over the past couple of years is a greater awareness of excess sleepiness among OSA patients. As a consequence, we're seeing increased utilization there.

Yes. And as it relates to your question about whether it should be an a-la-carte approach for AXS-12 and SUNOSI given how complementary the planned indications are, our priority is to make sure that we can get the product approved. That's first and foremost. So let's start with that. And that's going to accomplish our main goal, which is to provide clinicians extra treatment options. And clearly, given how the patients are treated with narcolepsy, given the varied symptomatology. Probably undoubtedly, there would be patients, who received both SUNOSI and AXS-12. And our goal is to provide clinicians the data such that they can treat the patients in the best way that they see fit.

Our next question comes from the line of Ram average with H.C. Wainwright.

Congratulations on all the progress. Just with respect to SYMBRAVO, I was wondering if you could elaborate on the number of centers that you expect to target in the next wave after the initial 150 headache centers. And also if you could tell us a little bit about the timing with which you expect the DTC campaign for SYMBRAVO to be engaged if we should be thinking about the time line as being similar to the time line with which you initiated the DTC promotional activity in support of AUVELITY?

Thanks, Ram. So regarding the, I guess, increase in number of centers, the way to think about it is right now, we are really focused on the predominant headache centers and heading specialists in the country, a future expansion would enable us to actually expand out more into the primary care market where you might have a heavy proportion of migraine treaters.

And so right now, we feel very good about our coverage of headache centers and headache specialists, but that next wave would really be more about primary care expansion. As it relates to DTC, I think it's a little premature to talk about potential timing. If you look at AUVELITY and our timing related to our DTC launch, it really was a function of ensuring we had a strong foundation of HCP prescribers support from a prescriber perspective, we have reached a critical mass in terms of market access, and we had a sales force size that was big enough to support the increase in patient requests coming from a DTC campaign. So when that might happen, obviously, we're focused on execution across all fronts and we'll evaluate as the brand progresses.

Our next question comes from the line of Jason Gerberry with Bank of America.

It's on for Jason. Congrats on the quarter. Just on AXS-05 for Alzheimer's disease agitation. Could you maybe share your understanding of the clinical profile bar that's necessary for priority review under breakthrough designation? Is there a requirement that AXS-05 shows efficacy benefit relative to Rexulti? And maybe how do you think investors should think about that scenario and the read-through to the ACCORD trial? And then just a quick follow-up on your comment on AXS-05 ADA long-term care promotion. Could you just maybe detail what those efforts look like? Are there docs that are affiliated with long-term care facilities I appreciate any additional color there.

So just one thing just to share, our base case here is always a standard view for the application. And we are eligible and for a potential priority review, but our understanding is that currently, the develop position for the FDA for any application is standard review. And with respect to like quantitative efficacy bars, that's not how it works, right? It's -- so it's not a specific or again, quantitative analysis that the agency does.

So it's hard to give you anything there for what may or may not go into an analysis like that. But again, our base case has always been smarter. And I think we will -- as we said, we'll keep people posted on a potential acceptance decision as I think the next thing that we'd expect for the course of the review.

Yes. And in terms of your long-term care question, it's a little different than traditional outpatient facilities where you may be calling on MDs and the PAs along with office staff in long-term care facilities, there's a significant nursing staff, pharmacy directors, medical directors. Of course, there are physicians, NPs and PAs that will make rounds in long-term care, but they also are treating patients in the community.

And so there is a synergistic effect of the community-based promotion for those clinicians that go into long-term care. So it is a little bit of a different approach, which is why we feel it's necessary to have a dedicated team focused on long-term care facilities if the drug is approved.

Our next question comes from the line of Yatin Suneja with Guggenheim Partners.

One more question on the ADA. How do you think about the ADCOM? Is that going to be required given that we already had one for the pace with Rexulti? Just curious to hear your thoughts on how you are thinking about it?

In Adcom, that's something companies find out on potential acceptance decisions for FDA. So stay tuned on that.

Our next question comes from the line of Graig Suvannavejh with Mizuho Securities.

Congrats on the continued success across the board, both commercially and on the pipeline. Just want to talk about AUVELITY commercially. I just wanted to revisit the gross to net and its evolution. I think you mentioned that the gross to net was in the high 40s in the third quarter. I'm wondering what led to that happening and whether there are any unique onetime events or items that contributed to that?

And also just looking forward on the progress you've made with contracting. Are there any other significant gains that you're looking forward to? I mean it seems like you're in a pretty good place, but just wondering just in the future, how we should think about that dynamic?

Graig, this is Nick. Thanks for the question. You're correct, AUVELITY discount for the quarter improved from the mid-50s to the high 40s in Q3. So pleased with the net price improvement around AUVELITY. Something that did change during the quarter is that we received additional 28 million lives in Q3. And so we were able to see those lives covered in an improved fashion in first-line or first -- so improved access, improved amount of patients covered along with improved net price from a GTN perspective. Ari, do you want to take the second question?

Yes. So I think, first and foremost, we're at 85% total lives covered, which we're really pleased with. We shared on the opening remarks that we signed the third large GPO. Our expectation is to continue to add additional covered lives. Our goal is to try to get to as close to 100% as we can. Obviously, if the third GPO signed that will enable additional covered lives moving forward. As you know, it's very difficult to predict actually when those new PBM contracts will come online.

But we do feel optimistic that there's great interest and the team is continuing to focus on driving additional covered lives moving forward.

Our next question comes from the line of David Hoang with Deutsche Bank.

Congrats on the quarter. I just wanted to go back to the planned sales force expansion for ADA, recognize that it's early days, but could you maybe book end or at least point us towards maybe a minimum number of reps that you think would be sufficient to execute a successful launch in that indication? And are those numbers already contemplated in your guidance for reaching cash flow positivity?

Yes. Thanks, David. The plan would be to expand the team, if the drug is approved. In terms of the overall number, we're still working through that. There's obviously 2 pieces to it. One is, are there clinicians, we don't -- we would like to cover that we don't currently cover with the current team and what sort of incremental head count numbers we need to reach them. And then the long-term care area is something that we'll need to think through in terms of overall head count needed to appropriately educate and engage with long-term care setting.

So a little early to share a specific number, but the goal is to expand the team if AXS-05 is approved and we'll share additional updates in the future.

And David, would you mind just repeating, I think you had a question about cash flow positivity.

Yes, whether the ADA -- anticipated ADA sales force expansion is already contemplated within the existing guidance or cash flow positivity?

Yes, David, it's Nick. Absolutely. It's contemplated. We -- the way that we forecast our cash is assuming that everything is positive. It relates to clinical and regulatory outlooks and then the additional associated costs with that. So obviously, upon the launch, you would have -- it would be capital intensive in the first few quarters. And then ultimately seeing an ROI.

So yes, the answer is we have already included that in our cash flow.

Our next question comes from the line of Troy Langford with TD Cowen.

Congrats on the progress in the quarter. Just with respect to AUVELITY, approximately how many quarters do you think it will take to see an impact from the recently launched DTC campaign on prescriptions? And do you think we're seeing sort of inflection in the current trajectory of prescriptions? Or do you think we'll see just more of a continued gradual upward trend?

Thanks, Troy, for the question. In terms of number of quarters, it's hard to predict exactly when the most significant impact from DTC will hit. But one of the things that we're looking at is changes in our weekly new patient starts. We have begun to see an increase in new patient starts. In general, it's sort of 8 to 12 weeks is when we'd be looking for anything significant in terms of DTC impact. Right now, we feel like it's still early days, but we're pleased with some of the trends that we've observed and we'll continue to provide updates.

Our next question comes from the line of Myles Minter with William Blair.

Just the first on the third GPO contract in the P&T meetings coming online. Would you expect that commercial covered lives moving from 75%, somewhere in the mid-90% have a similar favorable gross to net impact, as you saw with the 28 million lives coming online in the third quarter there? And then secondly, just given the FDA news this morning with and then George Timat, obviously, resigning. Just anything you can say about the confidence of the FDA as you work through the regulatory process on the SEDAR side?

Myles, I'll take the first one on GTN. I think it's too early to say where GTN will land with an additional contract now at hand. So -- but we are pleased, as we shared with with where we are with the improvement in GTN as well as the improvement in the amount of last and the formulary access. So stay tuned for where that we will land. But we will continue to negotiate in a similar fashion as we have previously, ensuring that we maintain long-term value and try to have as many patients covered as possible. .

And on the FDA side, right now, things are status quo for us in terms of our dialogue and interactions with -- across the various divisions that we engage with.

Our next question comes from the line of Mason with B. Riley Securities.

Congrats on the quarter. On AUVELITY and SUNOSI as well, but more so AUVELITY, are you seeing per prescriber activity trending upward. Just trying to kind of get a sense of how much growth here is sensitivity to promotions versus more organic growth? Obviously, the sensitivity to promotions is great. But my sense is that there's also some organic growth here as well. If you could just comment and then maybe a follow-up.

Yes. Thanks for the question, Madison. We are -- I guess the way that I would recommend sort of thinking about the growth is it's a function of 2 things: productivity amongst existing writer. So the number of prescriptions per existing writer and then our ability to add additional new writers into the prescriber mix.

And for both brands, we're seeing those things come to fruition, which I think is a testament to the impact that these medicines are having on patients' lives, the positive reinforcement that these clinicians are hearing from their patients and our team's ability to engage with them and achieve them on a routine basis. So those are things that we'll continue to look to drive moving forward.

Got it. Understood. And then -- secondly -- so we have 4 Phase III trials planned to initiate this quarter. Just wondering on the cadence of those, should we think this is almost parallel launches? Or will these kind of come in a sequence throughout the remaining quarter?

Yes. So with 4 Phase III trials launching, there are a lot of moving parts from an operational perspective to make sure that, that happens. So it's very unlikely that they're all going to happen on the very same day. So do expect a natural cadence. It's nothing that we're preplanning. However, we are working towards and are on track for the initiation of those studies in the fourth quarter.

Our last question will come from the line of Benjamin Burnett with Wells Fargo.

This is Craig on for Ben. So just a couple from us here. So given your successful track record of getting products through the finish line, I'm curious, can you provide a little bit of color of how your regulatory interactions in regards to the sNDA for AXS and ADA has maybe differed from some of those past programs? And I guess second question, in regards to narcolepsy, I feel like we're seeing a lot of estimates of the epidemiology of those indications kind of expanding and expanding further. So out of curiosity, what do you guys think is driving that? And are you seeing growth in IH, T1 and T2, any one particular area? Yes, any color there would be helpful.

I'll take the first part. So it's ordinary course at the moment based on where we are in the cycle -- in terms of the submission for AUVELITY in AD agitation.

Yes. And from an epidemiological perspective, for narcolepsy you've got to look at the surveys that are done and the quality of the surveys. And however, one aspect of the market that we've always pointed to, is the fact that in this orphan indication, there's still a large percentage of patients who, one, have not diagnosed in the past. And secondly, or treated. So certainly, as there is more interest in the space as more products are being developed and coming to market, one would expect that there would be an increase in awareness and maybe that's what you're seeing. Anything that you would add, Ari?

No. I think you mentioned NT12-IH, I think that there's a lot of symptomatology overlap in different formalized diagnoses, which may muddy the waters a little bit. But from our perspective, we feel good about our current estimates, which is around 185,000 people in the U.S. suffering from narcolepsy, and that's what we're building our things around. .

There are no further questions at this time. I would now like to hand the call back over to management for any closing comments.

Thank you, and thanks, everyone. Thank thank you to everyone for joining us this morning. As we've highlighted today, Axsome delivered another strong quarter. We continue to drive robust growth across our commercial portfolio, and we are well positioned to deliver significant long-term value through our advancing pipeline. We look forward to sharing our continued progress in the coming months. Thank you. .

This does conclude today's teleconference. We appreciate your participation. You may disconnect your lines at this time. Enjoy the rest of your day.

Everyone, good morning, and thank you for joining us for our Fifth Annual TD Cowen Novel Mechanisms in Neuropsychiatry and Epilepsy Summit. I'm Joe Thome, one of the senior biotech analysts here on the team at TD Cowen, and it is my pleasure to kick things off this morning with the team from Axsome Therapeutics. And joining me today, we have COO, Mark Jacobson; and CFO, Nick Pizzie. So thanks, guys, for joining us this morning.

Maybe just at a high level, obviously, you had a lot of great progress over the past year, both commercially and in the development pipeline. So maybe if you could just at a high level, let investors know what they should be expecting even at the end of 2025 now and maybe even to the beginning of 2026 as they look ahead.

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Sure. So good morning. Thanks for having us, Joe. I'm Mark. And I'll actually maybe turn it over to Nick to talk about the commercial side of the business, and then I can speak to some of the R&D efforts if that works.

Yes. Sounds great. So Joe, maybe just taking a step back into Q2, net sales for the quarter were $150 million, right? Obviously, focused heavily on Auvelity $120 million of the $150 million. Sunosi made up $30 million of that. And then we just recently launched SYMBRAVO. We had about 2.5 weeks of launch there, which did roughly around $400,000. So a lot to be excited for -- in the back half of the year. Some of the things that have transpired specifically around Auvelity. We did the expansion in Q1 of 40 reps. And we've seen the return on that investment already.

So taking a look at Q4 and Q1 of last year, we were seeing NBRxs in the range of 2,000 per week. Once those 40 reps got their legs under them in Q2 and Q3, we're starting to see NBRx. And we are seeing NBRxs at the 2,500 level per week. So we're seeing the efficiency from those 40 reps and also the original 260 being even that much more effective. So super pleased with that.

Secondly, we announced that we added 28 million additional lives covered in a first line or first step. So really great coverage. That was announced July 1. So super excited about that for -- specifically for patients. How that transitions into the back half of the year? One's of the things that we've shared is from a net price perspective, with this additional lives with patients being able to actually get drug much easier without having to go through necessarily a PA process and so forth.

We're able to actually maintain net price. And what that means is from a gross to net perspective, we don't expect any degradation in our gross to net. So we've shared that we're in that mid-50s range in Q1, Q2. We haven't changed guidance for the back half of the year. We'll see how claims are adjudicated in Q3, and we'll be able to give an update from that perspective.

And then most recently, we launched our national direct-to-consumer campaign. That's a national TV advertising campaign for Auvelity, which was launched last Monday. It premiered on the TODAY Show on Monday morning. And we expect to run that through the back half of the year. So super excited about that. We'll start seeing Internet searches, Google trends hopefully to increase. And then from there, we should start seeing the NBRxs and then finally, return on the investment would be through the [ Ts ] through the refills.

So a lot to be excited for specifically around Auvelity. Sunosi continues to do its thing, super healthy business, and we're seeing nice growth year-over-year from that perspective. And then SYMBRAVO, we launched SYMBRAVO at 2 weeks prior to the end of the quarter with 100 reps, so very discrete field force. Very early days, but we've heard anecdotally lots of positive things from HCPs, and we're seeing the NBRxs come through. So really pleased with that. So stay tuned for how that continues to grow. Mark, maybe a little on the clinical side?

Sure. And yes, so just commercially, we'll continue to drive growth and make investments as we see are rational. And so we're really excited for that part of the business. And then turning to the R&D and development side and development pipeline. Obviously, of key focus and key program for us is AXS-05 in Alzheimer's disease agitation. The latest there is sNDA filing we've guided to the third quarter, and that's intact and that guidance remains the same.

And likely, the next update you can hear from us is acceptance decision from FDA, and we'll keep everyone posted there and provide updates as there are developments, and we can dig into that, Joe, if that's helpful. We have another NDA submission planned for the fourth quarter, that is AXS-12 in narcolepsy and very excited about that. And then behind those 2 regulatory items, just a ton as per usual going on the clinical side in terms of clinical trials.

So we have 4 clinical programs for solriamfetol that are moving along. So we have some upcoming trial initiations in ADHD and major depressive disorder, ongoing studies in binge eating disorder, shift work disorder. There's work for AXS-14 in fibromyalgia. We said we'd launch another trial in that program. And AXS-05 in smoking cessation, we plan to launch a trial in that program as well. So just, again, a ton going on, on all fronts across functions in the company. So we're really, really excited for where things are today and the outlook.

Perfect. Great. Definitely a lot to dive in on. Maybe we'll start with the commercial franchise for Auvelity. But maybe can you talk a little bit about what you're seeing in terms of the type of patients that are using Auvelity now? And if that's changed at all since sort of the initial commercial experience a couple of years ago?

Sure. Right now, we're seeing -- so about 50% of the utilization is in first line or first switch -- which is great, right? And it speaks to we're already at this point of the launch, the product can be used pretty robustly as clinicians think is appropriate across the treatment paradigm. So that's fantastic. And if you look at that, it's about 15%, 16% first line and then obviously, 35%, 34% second line, which is fantastic, and then it kind of goes from there in later lines. And we've seen that increasing over time, steadily increasing over time in terms of earlier utilization. And that corresponds to, I think, just a number of things, our commercial efforts and focus in terms of being able to expand detailing to primary care and things like that.

So those tend to be HCPs who are seeing earlier line patients. Nick touched on the improvements in access. And so that also -- the type of access we're targeting is to facilitate clinician prescribing decisions, right? If they think a patient earlier in say, first or second line is appropriate, then we want to make sure access is present to facilitate those prescribing decisions. And that's moving along. But that's -- we've been very steady in terms of making sure we secure access that we think is meaningful, but also sound from a business perspective.

So that's there. Another way to look at that is monotherapy use. And we're seeing -- I think now it's a bit over 50% is -- the product is utilized in a monotherapy fashion, which is great, which also speaks to earlier utilization and then also the potential of the product to facilitate reductions in polypharmacy, which is fantastic. And so really like where we are today, and we expect that to just continue to improve in terms of who can use the product earlier in the treatment paradigm and things like that. So we'll keep you posted and our investments from a business perspective correspond to driving additional growth in that realm.

Perfect. And Nick, in your opening remarks, you mentioned kind of 3 main drivers, first being the commercial sales force; second, the new covered lives coming online; and then third, the DTC campaign. So maybe we can kind of break those down. Individually, does this kind of we see all of those different components kind of come online kind of over the next -- they have already, but kind of over the next 6 months.

So for the sales force, do you think you've seen sort of the full impact of the sales force at this point? Is it steady state? And kind of when you think about what you're seeing in the field, are you rightsized right now? Or would you continue to maybe look to expand? Obviously, with all [indiscernible] you have that goes in depression?

Sure. We have seen, obviously, that nice increase from 2,000 to 2,500 NBRxs per week from the team. Are we rightsized? I think we're in a good spot as of now. I think the next natural expansion is -- I'm sure what we're going to talk about more is ADA. And what we have been sharing is that we would look to expand the field force team significantly to the point where we can add on to those 300 reps in primary care as well as in psych areas. So something meaningful from that perspective sometime in 2026.

And then additionally, I know we're not going to talk more MDD right now without ADA, but speaking on the field force, we would look to have more like a discrete long-term care tactical field force that just solely focused on LTC centers. We're currently -- as a reminder, we're currently not even calling on LTCs. So it's a completely untapped market right now for MDD for us and then obviously, the indication of ADA. So from a field force perspective, I think that would be the next natural expansion.

And maybe even take a step back, if you think about where -- what we've done thus far, we started with 160 reps, we went to 260 last year, January of '24, went to 300 in January '25, and we're already annualizing at $0.5 billion only 11 quarters in. So we've been -- I think the way that we've invested, and we've always done this since inception, the way we've invested money. And when we see return, we will invest that accordingly. We're not just going to go and say, hey, we need 800 reps out in the field and then just have them go around. So we try to do a very disciplined approach.

One thing I might add to that, Joe, is when you think about the current Auvelity sales team, there is high overlap from a detailed target perspective. And so the team is going through that analysis right now in anticipation of a potential review and potential approval. So the work on the commercial side is already underway.

Yes. And maybe just one last point on the field force expansion. I think when we first started, it was heavily psych. The call points are heavily psych and scripts were like less than 1/4 of total scripts were in primary care. Now we're already seeing it at roughly 1/3. So that is going to continue to grow as the field force continues to grow, as territories get smaller, they're able to have better breadth and depth. So that would be one of the things to be looking forward to in later this year and into '26. And just with that primary care call point and doing DTC, I know we'll be talking about that, but that's -- it comes together very nicely.

That's great. And yes, maybe for the last 2 components, just maybe on a sort of quarter-by-quarter basis. Obviously, Q3 for neuropsychiatry products can tend to be a little bit seasonally impacted. You are bringing more lives online through the coverage that's starting on July 1. And then obviously, you just started the DTC campaign, which I'm guessing will probably have more of an impact beginning in the fourth quarter. But I guess kind of how are you seeing these things kind of the timing and kinetics of them flow through to your revenues?

Yes. I think you're right on the additional coverage of getting to 83%, the 28 million lives coming on July 1. It's more of a downtime. July, August, people are feeling better. Doctors are taking vacation. Our reps take vacation, patients take vacation. So they're not as compliant with their refills. That being said, we're on the other side now of Labor Day. So we'll see how that continues to grow now that we're kind of back into, I'll say, a new year. Everybody is back to school and resetting. So we feel that with that additional covered lives, we'll see, again, no degradation in price, easier access.

So doctors will feel there's the actual piece of it and then there's the perception, too. If doctors perceive that they now can write and that we have these national wins, they feel more comfortable of putting their patients on Auvelity and they know that they'll continue to get Auvelity. Previously, we had a very generous patient service program. So we try to ensure that patients will always receive Auvelity. But when you actually get that payer coverage, there's something more tangible about that from a doctor's perspective.

So -- and then maybe just one last thing on covered lives. We do -- we feel optimistic that 83% is not where -- it's not going to be steady state. We feel that there is additional covered lives to be had and hopeful for those additional 17%. So that's for the rest of this year, and we'll be able to give an update as things evolve.

Perfect. Maybe we'll jump over to Alzheimer's agitation. Mark indicated that the filing last update was we'll follow that in Q3. And so when you had your breakthrough therapy designation meeting with the FDA, the agency at that time said you would need 1 additional placebo-controlled study in addition to ADVANCE-1. You now have ACCORD-1 and ACORD-2. I guess, in addition to the support data from ADVNCE-2, but that one didn't quite meet the mark, obviously. I guess, how have your interactions changed, if any, kind of since that time, given that, obviously, shakeups at the FDA have been a huge investor in kind of public focus this year. Have you seen any changes in your dialogue at all that would make you think differently about the application, I guess?

Sure. I think I'll say that in totality for the common -- for the overall program and then recently. So for the overall program, the feedback and dialogue has been consistent for what the FDA is looking for, which is 2 adequate and well-controlled trials, positive. And -- so we'll be coming with 3 positive adequate and well-controlled trials. So that's been very consistent up to and in connection with the pre-NDA meeting feedback that we announced in April.

So that's all been very consistent. And say, focusing on 2025. And so consistency there in terms of engagement and feedback on the development program that we ran and the trials we've completed, what studies they're looking for a determination and assessment of efficacy for an assessment and determination of safety and things like that. So we can talk about those, but again, all very consistent.

And then looking at 2025, it's status quo in terms of our engagement, dialogue and the division. It's the psychiatry division. This is a division that reviewed Auvelity in major depressive disorder and obviously, that it was approved. And as far as we're aware and yes, changes, both in the staffing or disposition from our vantage point and interactions, again, things are status quo with division director and below reviewers and things like that, project manager interactions. So no -- another way to put that is no updates in terms of our approach or perspective on the program, the package, the filing strategy since we shared the pre-NDA meeting minutes in April. So it's status quo.

Perfect. And I guess, based on your conversations, do you believe that the FDA views parallel placebo design studies differently than randomized withdrawal studies? And secondarily to that, how are the KOLs using this information? Because I do feel like they provide a little bit of a different bout of information for patients on how they would manage patients. So I guess how does the agency think about it in your opinion? And then how have your physician feedback on the 2 different designs been?

Sure. They are different designs. So they generate different data sets. But in terms of demonstration of efficacy, those -- you can get that from both, right? And so -- and that's a substantial evidence of effectiveness question. Then you have other questions, labeling, how does it look from a labeling perspective? And then how does it look from a KOL perspective? So ADVANCE-1 that classic parallel group where you can track longitudinal change, separation from placebo and when that occurs, right? We saw that occur at week 2, stats at week 3.

And so whereas the randomized withdrawal studies, those are -- you can assess maintenance of a treatment effect and obviously, signal or separation versus placebo, but a different type. And so -- but you can still demonstrate a treatment effect. And we did that. And so we'll have ACCORD-1 and ACCORD-2, both which were incredibly consistent from the results perspective, also from an activity perspective, consistent with ADVANCE-1. So that's great.

And the KOL feedback, obviously, that will -- that can grow over time, right, as more have experience with the product candidate and potential product, we'll call it. But currently, right, that one helps with thinking about onset, which I think is important with respect to the current standard of care and how patients are currently treated, the tolerability profile associated with that and magnitude of treatment effect, right? And so -- and that kind of ties to clinical meaningfulness. So we've received good feedback from KOLs with respect to that, but then also demonstrating prevention of relapse and agitation symptoms and durability of a treatment effect through the randomized withdrawal study.

So another key element that we've -- that KOLs have flagged is the safety and tolerability profile, which is very distinct and, of course, very important for this patient population, elderly patient population at risk. And current treatment options have a number of risks associated with those. AXS-05, entirely different mechanism of action and product and molecule, so to speak. So we're pleased with the feedback we've received from KOLs.

Perfect. And maybe what are your latest expectations for how large this market can be? And maybe following on to your last point, Mark, we have heard from our KOLs that the potential lack of a black box warning for mortality for Auvelity versus what we see for Rexulti would be particularly meaningful. I guess, are you hearing that as well? And how much larger do you think, I guess, that could make Auvelity versus kind of what we're seeing in the initial launch trends with Rexulti?

Yes. The -- I mean, the feedback about -- so black box or just more broadly, say, warnings and precautions or the description of adverse events, right, that -- and obviously, it's specific labeling or what the specific label might look like. Obviously, that's getting ahead of ourselves, but it ties to the tolerability profile. And we saw distinct rates of AEs. We did not see a signal with respect to falls. We did not see a mortality signal. So I think that ties to what you're referring to from a black box for the atypical antipsychotics that -- so that's very good. And Nick, do you want to comment on that.

Sure. We estimate the market size, total Alzheimer's patients are around 7 million and upwards of 3/4 of them have agitation. So that's around 5 million patients that are -- that would need -- essentially need therapy. So we -- from a peak sales perspective, we look at this as a significant opportunity even north of where Auvelity and MDD is. We've shared peak sales in the range of $1.5 billion to $3 billion. That's as of today, I think we've typically taken a more conservative approach in how we look at peak sales. So we'll see how the product does assuming approval and once it's launched.

Perfect. Maybe we'll jump to some of the other programs just for a time, but obviously, a lot of focus on that. So best of luck with the FDA. Maybe jumping over to SYMBRAVO. Maybe you can talk just a little bit about the initial commercial experience. What sort of patients are reaching for the drug? And then obviously, through your programs, there is a large paydown component early in the launch. And kind of when will we start to see if that kind of flips over into longer-term prescriptions. Is that a 2025 event? Or is that maybe something more that we should look out for, for the first half of next year?

Sure. Maybe I'll take the second question and then Mark can talk about the patients that are trying the drug currently. So we do have a robust patient service program. And what we've shared is that our co-pay card will allow -- our co-pay card program will allow NBR patients to try the drug, and it's a full buydown for SYMBRAVO. So essentially, patient goes to the doctor, they maybe get a sample to start with and then try it and then come back and then get a script. That scripts, if they use the co-pay card or co-pay card program, they'll be able to have a full buydown.

And then ultimately, we're looking for the HCP to then pull through the PA to initiate it, submit it and then approve it and then have the payer get paying for that script. I would say for this year, we launched 2 weeks into -- or 2 weeks prior to the end of the quarter, going into the summer months, as you mentioned, Joe, earlier at the top, it's very seasonal in neuropsych. We've seen growth, and we're pleased with what we're seeing even through those -- through that time period, we do have 100 reps that are out in the field as opposed to some of the other [ GPAs ] to launch with 600 or 650 reps out of the gate.

So we are taking a disciplined approach. But I would say for this year, this is the investment year. We're looking to drive scripts, drive adoption, develop payer access, similar playbook to Auvelity. And then at the turn of the year, we'll be able to kind of get a good sense of how the launch is going.

Early use. So it is early. And so there's not a ton of data. But so far, the approach on the commercial side has been to focus on headache centers and headache specialists. And with that, you tend to see later line patients, right? These are individuals who have had acute migraine, have made their way from a prescriber or physician HCP perspective to these specialists and centers. And so they tend to have tried a number of products already. And so they tend to be later line. That also matches the new-to-market block that new brands, new products face from a payer perspective and meaning that payers will drive or force later line utilization.

And Nick touched on some of the commercial infrastructure or patient support offerings that are in place that -- to match that prescribing dynamic. And one thing that we like so far is, again, it's early, and so it's highly anecdotal, but the feedback we're getting in that late-line setting, and this is consistent with the clinical data we generated is that the product works well from an efficacy perspective and also it has a tolerability profile that we're receiving positive feedback on and -- which is great.

And so we'll continue to work to drive trial of the product, and we'll be looking for feedback from prescribers on how it does, and then that will inform, as Nick mentioned, additional investment in the launch. So early days, but we like how we're kind of coming off the launch pad.

Well, great, we could go on for another half an hour, but maybe just to end, obviously, a lot of development going on with Sunosi. You have several clinical -- late-stage clinical studies wrapping up and some commercial progress here. I guess the company has done -- did well with the Sunosi acquisition. I guess, are you looking at additional BD either commercially or in the pipeline? Or are you happy with what you have? Kind of how are you thinking about that?

Sure. We have -- look, it's something that we'll keep an eye on out there. But what's great is, as you mentioned, Joe, we have such a robust late-stage pipeline right now. So we're always keeping an eye and the market is a bit volatile right now. So we're -- we definitely are seeing what's out there, but there's really no need to. We're very happy with that Sunosi acquisition, as you mentioned, and being able to develop solriamfetol for further indications. And we'll keep an eye else -- what else is out there at this point, but no need to do anything.

Perfect. Great. Well, unfortunately, we are out of time, but thank you both for joining us today, and thank you for the investors for tuning in.

Appreciate for your time, Joe.

See you later.

Bye-bye.

Bye.

Good afternoon, everyone, and welcome to Morgan Stanley Global Healthcare Conference. I'm Sean Laaman, Head of U.S. SMID Cap Biotech Equity Researcher here at the firm.

Before we commence, for important disclosures, please see Morgan Stanley research disclosure website at www.morganstanley.com/researchdisclosures. And if you have any questions, please reach out to your Morgan Stanley sales representative.

For this session, we have Axsome and COO, Mark Jacobson; and CFO, Nick Pizzie. Welcome, gentlemen, and thank you for your time today. And I thought maybe to commence proceedings, if you want to make some remarks to set the scene before we begin Q&A. But welcome, and thank you for your time today.

Thanks, Sean. Really appreciate it, and it's nice to be here. It's a very busy and productive day for us, which is great. And just by way of intro, Axsome is focused on Frontiers in Brain Health. And what that means is we are focused on areas of unmet need for central nervous system disorders. And we do that through a variety of ways. We have 3 on-market products, which Nick will touch on shortly and a very robust pipeline of a number of late-stage product candidates from Alzheimer's disease agitation to ADHD, narcolepsy, et cetera, and we'd be happy to run through the updates there.

But very happy to be here today, and I'll turn it over to Nick who can kind of frame where we are from a business perspective on the commercial side of things.

Sure. Thanks, Mark. As Mark mentioned, we have 3 commercial products. As of the end of Q2, we had $150 million in total net revenue, of which $120 million was related to Auvelity, $30 million for Sunosi, and then we just recently launched our most recent commercial product, SYMBRAVO in migraine. That was in the market for just 2.5 weeks and did just under $0.5 million. So super excited about those 3 products, specifically, Auvelity, 11 quarters in now, tracking towards close to $0.5 billion annually.

And one other announcement that we had is that we were able to increase access for Auvelity up to 83% of total covered lives, 28 million additional lives covered with no degradation in net price. So super excited and have a lot of good things to look forward to in the back half of the year.

Wonderful. We've got 3 macro questions. And the first one of those is with China's rise in biotech innovation, how do you think about Axsome's competitive position here? And will this influence your R&D and business development strategy?

Sure. The developments in China and rest of world in terms of increased prowess or presence in R&D, and we've been aware of that and mindful of that. And in terms of our day-to-day, we're doing our thing and it's good to be aware of. Outside the U.S., what we've shared is we plan to -- our general approach is to think about partnering the assets that we have global rights in. And so that's obviously relevant for key markets, potentially including China, depending on what -- to your point, what may be available or development in the space there.

It's also interesting in terms of R&D and development that's happening there that may be interesting to explore opportunities in the U.S. So I think that just we fold that into our just general commercial intellectual property considerations and also potential pipeline development and expansion considerations. So it's no big changes to how we go about our day-to-day business as yet.

Wonderful. Wonderful. And how are you currently leveraging AI or the about AI's future disruption potential?

Definitely. So AI is -- we see it and use it across a number of functions of the organization. Very -- first and foremost, we see as driver of efficiencies in some areas. And we have already developed a broad kind of deployment and utilization framework on the commercial side of things. So the team has developed and is utilizing actively an AI engine that helps detailing efforts in terms of engaging with clinicians and ensuring team members have access to data and information, detail aids or components of the core visual aid that is most appropriate for any discussion.

In terms of responsiveness and helping to identify what areas to quickly engage with someone on or in terms of driving efficiency and responding to an inbound query, things like that. And all the way through data and analytics, how we're thinking about analyzing commercial and R&D data, it's relevant there. And it's also very interesting and useful in terms of looking at historical data in the industry in terms of R&D that can be data sets or, say, approval histories and things like that.

So we find it broadly useful and drive efficiency. But then that comes with also a mindfulness in terms of how these language model works, what gets uploaded to them, what platforms and things like that. So there's a deep -- basically, an AI champion team internally that helps with that.

Wonderful. And what has been the most impactful in Axsome on the regulatory side? Is it FDA, MFN or tariffs?

I don't know that we've seen disproportionate impact from any of those and maybe you would say pleasantly the state of the business is pretty much status quo with respect to all those, and we can touch on them. So regulatory, the way we engage and the different divisions we engage with, that it hasn't manifested in a way such that we've seen any type of differential engagement or type of feedback or dialogue there. So -- but we know it is impacting how they go about their business. But nothing in terms of a material impact to us that we're aware of. And then do you want to touch on the other?

Sure. Maybe on tariffs and MFN, we don't believe there's any material impact. It's a material impact to the organization for most favored nation pricing. The only product that we have that is commercialized ex U.S. is Sunosi that is by our partner, Pharmanovia in Europe. So if there is any specific impact that would relate specifically to the government channel, which is a small portion of the Sunosi business.

As it relates to tariffs, the majority of -- well, all of Auvelity and all of Sunosi is manufactured in the U.S. and Canada. Again, the only potential impact would be as it relates to Sunosi, which is manufactured ex U.S. The tariff would be an immaterial impact. If you focus specifically on cost of goods, the material piece -- the cost of goods is made up of royalties, material, labor and so forth. The tariffs only impacts on the material piece, that would be such a small subset of Sunosi that we don't find that's a material impact to the organization as a whole.

Wonderful. Not specific Axsome questions, sort of a series on Auvelity and MDD. And continue to show strong growth in MDD. And remind us what the key drivers are behind this observation and adoption? And how do you see usage evolving in primary care versus psychiatry?