Good day, ladies and gentlemen, and welcome to Acadia Pharmaceuticals' 2nd Quarter 2019 Financial Results Conference Call. My name is Michelle, and I'll be your coordinator for today. At this time, all participants are in a listen only mode. We will be facilitating a question and answer session towards the end of today's call. I would now like to turn the presentation over to Mark Johnson, Vice President of Investor Relations at Acadia.
Please proceed.
Thank you, Michelle. Good afternoon, and thank you for joining us on today's call to discuss Acadia's Q2 2019 financial results. Joining me on the call today from Acadia are Steve Davis, our Chief Executive Officer,
who will provide a brief overview
of our strategy, recent achievements, pipeline opportunities and financial performance. Michael Yang, our Chief Commercial Officer, will provide updates on our commercial initiatives with NUPLAZID Serge Sankovic, our President, will discuss our pipeline progress and Elena Ridloff, our Chief Financial Officer, will discuss our financial results before turning it back to Steve for his final remarks and opening the call up for questions. I would also like to point out that we are using supplement slides, which are available on the Events and Presentations section of our website.
Before we proceed, I would first
like to remind you that during our call today, we will be making a number of forward looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward looking statements, including goals, expectations, plans, prospects, growth potential, timing and events or future results, are based on current information, assumptions and expectations that are inherently subject to change and involve a number of risks and uncertainties that may cause actual results to differ materially. These factors and other risks associated with our business can be found in our filings made with the SEC. You are cautioned not to place undue reliance on these forward looking statements, which are made only as of today's date. I will now turn the call over to Steve Davis, our Chief
Executive Officer. Thank you, Mark. Good afternoon, everyone, and thanks for joining us today. Our team delivered strong sales performance this quarter as you can see on Slide 5. In the Q2, NUPLAZID achieved $83,200,000 in net sales, a 46% year over year increase.
Based on our execution and the growth of NUPLAZID in the 2nd quarter, we embraced our full year revenue guidance to $320,000,000 to $330,000,000 from a previous range of 280 $1,000,000 to $300,000,000 This represents a 45% year over year revenue and 30% year over year volume increase at the midpoint of the range. We continue to leverage our R and D capabilities as we pursue several pipeline programs addressing unmet needs in the CNS space with very large market opportunities. In dementia related psychosis, we continue to make good progress with our pivotal Phase 3 HARMONY study and expect to announce top line results in the second half of next year twenty twenty with an interim read in the second half of this year. In major depressive disorder, we have now initiated both of our Phase 3 studies. In schizophrenia, we look forward to completing dosing in our ongoing ADVANCE study, evaluating pimavanserin in schizophrenia patients with predominant negative symptoms and remain on track to announce top line results around the end of this year.
And finally, we plan to initiate our Phase 3 study, Lavenir, evaluating trofinetide as a treatment for Rett syndrome in the Q4 of this year. With that, I will now turn it over to Michael to discuss our commercial performance.
Thank you, Steve. Please turn to Slide 7. We are very pleased with the strong performance we achieved in the Q2. This is a reflection of our team's continued execution on our key commercial initiatives, driving awareness of PD Psychosis and the adoption of NUPLAZID as the treatment of choice. In the second quarter, we continue to expand our reach, adding new prescribers for Nuplazid and new long term care pharmacies, as well as new patient starts and growing volume at long term care facilities.
As a result, we achieved sequential volume growth of approximately 15% and year over year volume growth of approximately 34%. In the quarter, we were able to increase demand for NUPLAZID in both the specialty pharmacy and the specialty distribution channels. Principal drivers of growth were the completion of the 34 milligram transition of the 17 milligram tablets and our successful branded DTC campaign. Patient screening and care planning tools developed for healthcare practitioners also contributed to driving growth in the long term care channel during the quarter. In the second quarter, we realized both an increase in compliance for established patients and additional new patients starting on paid treatment.
Both of these benefits contributed significantly to the sequential volume growth and will continue to benefit our year over year growth for the remainder of 2019. Since we launched Emplaza, we have seen very consistent and high compliance for patients who continue on therapy. Notably, during the Q2, we saw this compliance to therapy increase even further, which was a strong contributor to our 2nd quarter performance. Reaching patients and caregivers directly is an important part of our promotional strategy. According to market research, our initiatives have resulted in increased awareness of PD psychosis and NUPLAZID as the only FDA approved treatment choice.
Motivated caregivers and patients are actively seeking additional information on PDP and NUPLAZID and having conversations with their healthcare practitioners. Given the positive return we're seeing from our DTC campaigns, we plan to invest in an additional TV advertising in the second half of twenty nineteen to complement our ongoing patient and caregiver commercial initiatives. As a reminder, we would anticipate a lag before realizing positive benefits associated with new patients initiating treatment. We believe we have the right disciplined approach and cadence with these initiatives to deliver an attractive return on investment, while continuing to increase brand awareness for NUPLAZID. Looking ahead, we will continue to implement and execute on our commercial initiatives to grow NUPLAZID in PDP.
I'd like to thank our teams for delivering a strong quarterly performance as now more patients and caregivers are able to experience the benefits of NUPLAZID in the treatment of their PD psychosis. I'll now turn it over to Serge to provide R and D updates on our pipeline.
Thank you, Michael. As usual, I will provide updates regarding our R and D progress. Slide 9 highlights our pipeline programs, which I will be reviewing with you today. In total, we have 4 programs in late stage clinical development. Let's start with our dementia related psychosis or DRP program on Slide 10.
There is no FDA approved treatment for DRP. DRP is estimated to affect approximately 2,400,000 patients in the United States, of which only about half are diagnosed. We are currently conducting HARMONY, a Phase 3 relapse prevention study. We have agreement with the FDA that robust results from HARMONY can serve as the basis for a supplemental NDA submission. On Slide 11, we have a high level illustration of the Phase 3 HARMONY relapse prevention study.
We plan to announce the final top line results for HARMONY in the second half of twenty twenty with an interim read in the second half of this year. As a reminder, the statistical threshold for the interim read is very high. Let's turn to Slide 12 to discuss our MDD program. The majority of patients with major depressive disorder do not adequately respond to their treatment and continue to experience significant depression. Based on the positive and robust study results from our CLARITY study, we believe pimavanserin may represent an important new adjunctive therapy for patients struggling with their depression.
Slide 13 shows our Phase 3 development program for pimavanserin for adjunctive treatment of MMDD. We are very encouraged by the investigators' enthusiasm for our CLARITY-two study and this study is already enrolling well. In addition, we recently initiated our 2nd Phase 3 study, CLARITY 3. If we are successful, our Phase 2 CLARITY study combined with at least one of the Phase 3 trials would be the basis of a supplemental NDA submission. Last week, we announced top line results from our Phase III ENHANCE study.
These results and key takeaways are summarized on Slide 14. As we reported last week, the study did not achieve statistical significance on the primary endpoint. However, we were encouraged to see a consistent trend of antipsychotic effect and positive improvements on the negative symptoms of schizophrenia as measured by the pre specified secondary and exploratory endpoints. Let's turn to Slide 15 to discuss our program for negative symptoms of schizophrenia. Currently available antipsychotic treatments primarily the positive symptoms of schizophrenia.
Approximately 40% to 50% of schizophrenia patients experience predominant negative symptoms, which include apathy, lack of emotions, social withdrawal and cognitive impairment. This remains a significant unmet need for patients as there are no FDA approved treatments available. On Slide 16, we have a high level illustration of the ADVANCE study. This is a 26 week study evaluating pimavanserin as an adjunctive treatment for schizophrenia patients with predominant negative symptoms, while controlling for their positive symptoms. The primary endpoint is the change from baseline on the negative symptom assessment, 16 item scale.
We have fully enrolled the ADVANCE study and expect to announce results around year end. We are excited about our trofinetide program for Rett syndrome, Slide 17. Rett syndrome is a debilitating neurodevelopmental disorder that occurs predominantly in females following apparent normal development for the 1st 6 months of life. Currently, there are no approved medicines for this rare disease, which affects approximately 6000 to 9000 patients in the United States. Please turn to Slide 18.
We remain on track to initiate LavenDARE, our pivotal Phase 3 study for trofinetide in Rett syndrome in the Q4 of this year. This 3 month study will evaluate approximately 180 females with Rett syndrome aged 5 to 20. Slide 19 highlights our upcoming clinical milestones. We look forward to sharing our clinical I'll now turn the call over to Elena to discuss our financial performance.
Thank you, Serge. Today, I'll discuss our Q2 2019 results and our financial outlook. Please turn to Slide 21. In the Q2 of 2019, we reported $83,200,000 in net sales, an increase of approximately 46% compared to $57,100,000 of net sales in the Q2 of 2018. This was driven by approximately 34% volume growth year over year in Q2.
For the first half of twenty nineteen, new segment volume growth was approximately 27% year over year. The gross to net adjustment in Q2 was 13.2%. Gross to net this quarter was favorable versus our expectations as a result of the higher compliance rate for established patients. Weeks of inventory in the channel at the end of the second quarter were consistent with previous quarters. Moving down the P and L, GAAP R and D expenses increased $67,300,000 in Q2 2019 from $46,600,000 in Q2 of 2018.
The increase was primarily due to development costs for trofinetide and additional clinical study costs for pimavanserin. GAAP SG and A expenses decreased $58,000,000 in Q2 2019 from $59,500,000 in the Q2 of last year. The decrease was primarily due to timing of DTC advertising expense versus the prior year, partially offset by an increase in personnel costs. Non cash stock based compensation expense during the quarter was $20,400,000 compared to $20,600,000 for the same period in 2018. Cash used in operations during the quarter was approximately $38,400,000 compared to $40,900,000 for the Q2 of 2018.
We ended the quarter with $381,900,000 in cash and investments on our balance sheet. Please turn to our 2019 guidance on Slide 22. We are increasing our net sales guidance to be between $320,000,000 $330,000,000 for the previous range of $280,000,000 to $300,000,000 This reflects the increased compliance in new patient starts we saw in Q2 as well as the increased expectations that we now have for the remainder of the year. At the midpoint of the new guidance range, this represents approximately 45% revenue growth and approximately 30% volume growth year over year. Given the favorable gross to net adjustments in the first half of the year, we now anticipate the full year gross to net to be in the range of 17% to 18% and forecast Q3 gross to net to be in the mid teens.
As a reminder, gross to net in the 4th quarter will be higher than Q2 and Q3 as a result of accruing for the donut hole obligation associated with year end inventory in the channel. Turning to expenses, we continue to forecast GAAP R and D expense to be between $250,000,000 $265,000,000 We are now forecasting GAAP SG and A expense to be between $300,000,000 $315,000,000 from the previous range of $280,000,000 to $295,000,000 The increase is in part due to our plans to run additional television DTC ads in the second half of 2019. We continue to expect non cash stock based compensation expense to be between $80,000,000 $90,000,000 And with that, I'll turn the call back over to Steve.
Thank you, Elena. Please turn to Slide 24.
We are
very pleased with our strong quarterly performance and outlook for the remainder of the year. Ultimately, we don't measure our success by financial metrics alone, but by the true difference we can make in people's lives. Because of our commercial initiatives, more patients with Parkinson's disease psychosis are getting the treatment they need. Not only are their lives improving the treatment, but also those of their caregivers. Beyond PDP, we are excited that pimavanserin and trofinetide may offer hope to patients and their caregivers who struggle with dementia related psychosis, depression, schizophrenia and Rett syndrome.
Please turn to Slide 25. Looking ahead, we will continue to execute on all three of our strategic pillars: grow the sales of NUPLAZID and PDP, leverage the potential of our pipeline programs and expand
our pipeline through focused business development.
I'd like to close by thanking our employees whose dedication and hard work are driving our company's continued success and execution of our 3 pillar strategy. I'll now open up the call for questions. Operator?
Your first question comes from Cory Kasimov of JPMorgan. Your line is open.
Hi, this is Gavin on for Cory. Congrats on the quarter. We just had one on the Phase 3 HARMONY study. Anything you can provide on the like as far as qualitative data on event rates? And then I know it's a long shot, but can you provide granularity on timing, I.
E. Q3 versus Q4? Any color would be helpful. Thanks.
Yes, sure.
Serge, do you want to take both those questions?
Yes. Thanks for the questions. First question, in terms of we have been providing just some of the insight on the progress on recruitment and success rates in the open label study. We haven't been providing details on the relapse rates because that's a very variable and it's really not an indicator because it's very independent driven event in the trial. So from that perspective, no change.
We are progressing very well in both enrolling patients in the trial as well as, as I've always said, our success rates have been somewhat better than what we initially anticipated, but mostly for the most part around those numbers. So that's all I can say about that. Your second question, I'm not quite sure, are you referring to higher granularity around the final analysis or the interim analysis, if you would please clarify that.
Right. I was talking about the interim as far as the 2H 2019. Could you provide any granularity in terms of Q3 or Q4?
Well, we have not been commenting on the specific timing on that other than that it will definitely happen in the second half of this year.
Our next question comes from Tazeen Ahmad of Bank of America. Your line is open.
Hi, good afternoon. Thanks so much for taking my questions. Maybe a couple for Michael, just to follow-up on your prepared remarks. You talked about improvement or continued improvement in compliance rates, particularly seen this quarter. Can you give us a little bit more granularity on why you think that particular trend is occurring and whether you would continue to expect improvement in compliance?
And then secondly, I think you mentioned that you are planning a new DTC campaign to start in the second half of the year. I was curious as to how that might be any different from the DTC campaign that you had going on, which you ended in, I believe, the last quarter?
Sure, Michael. Yes. Hi, Tazeen. Thanks for the question. So when I talk about the compliance, I'm referring specifically to the number of bottles that a patient takes in the quarter and specifically around established patients or continuing patients.
And as I mentioned, historically, we've seen a very consistent and high compliance rate for those patients. We've in the past commented on the 34 milligram and how we believe that's going to lead to a better patient and physician experience. And notably, as I mentioned in this quarter, we saw an increase from those historical norms. So I think that if we were to attribute anything, number 1, the 34 milligram and also I think it's a strong endorsement of the value proposition and the profile of NUPLAZID. So I think all of those things in totality, I think you'll start to see that benefit in the base for the coming year and the rest of the year and that will be part of our new base.
In regards to DTC, I think you're going to see the same kind of look and feel that we've had with the prior campaign. Of course, we've learned a lot along the way and we'll be implementing those learnings mostly on the back end and in our refined other tactics. But from a consumer point
of view, I think you're going to see
a very similar campaign from the external perspective.
And I guess, why are
you choosing to restart DTC?
Right. Yes, there's a number of factors we look into when we evaluate TV media. We have an ongoing initiative to support caregiver and patient awareness and education. And those are on all the time. When it comes to TV, it's a pivotal obviously element to our campaign in general.
And we take things into consideration as how fresh and compelling our creative is, the media weight and the intensity to reach our target audience and more importantly, the time it takes for those behaviors to manifest themselves and actions that benefit the brand. In totality, we believe we have the right cadence and approach.
Okay. Thank you.
Our next question comes from Jason Butler of JMP Securities. Your line is open.
Hi. Thanks for taking the questions and congrats on the quarter. A couple of questions for Michael again. Any more granularity you can give us around the trends in the new patient adds or changes in the trends of patients who drop off therapy early versus those that go on to stay on the drug longer?
Hey, Jason, great question. So in regards to patient dynamics, obviously, the continuing benefit we're seeing in the take rate, we're going to have to have more quarters to see how that plays out in regards to duration of therapy. I can't say that we were ready to comment on duration of therapy, but certainly the intra quarter dynamics benefited from what we think as I mentioned before the improved experience with the 34 milligram. We added new patients. We added new physicians, long term care, pharmacies ordering the drug.
So I think we still have a lot more penetration, but nothing really unusual comment in regards to the intra patient dynamics in regards to drop offs, etcetera, just yet.
Okay, great. And then with the continued investment in DTC, any thoughts on the current size and structure of the field force and you're thinking about that for the second half of the
year? I'm not quite sure I heard the question. Was it DTC and the sales force?
Just you're obviously you're continuing to invest on driving awareness, driving more interest in the product. Are you on the back end? Do you feel like you have the right size and structure the sales force to capture that?
Yes. Great question. Yes. So over the past year or so, and I think we've commented on this, we've added capabilities in the organization focusing on increasing, for example, we've increased the footprint of our long term care group in the past. We've added kind of a key account function.
So we're going to continue to make the commercial, I'd say, adjustments to make sure that we capture all the best wind in the sales, if you will. So I think we're optimizing and I think we're operating at a very high level at the moment.
Great. Thanks for taking the questions and congrats again on the quarter.
Thanks.
Our next question comes from Salveen Richter of Goldman Sachs. Your line is open.
Great. Thanks for taking the question. This is Andrea on for Salveen. Maybe a question for Serge. As a follow-up to Gavin's question on the HARMONY study,
when
you think about how rapidly the trial has been enrolling, can you say if that's due to the large number of patients that are eligible to come on to the trial or if that's perhaps more reflective of the proportion of patients that are responding to therapy, who are then continuing on to the double blended portion? Thanks.
Thanks, Andrea. It is hard to speculate about I think that is a little bit of both involved. There is certainly we had and we've been reporting significant interest in the trial by the investigators and families and patients. And I think that's in large part also due to the kind of design of the trial where patients are starting treatment with the open active treatment for 3 months and that's much more akin to what standard clinical practice is. So we definitely had a high interest in participation in the trial.
And so from my perspective, that's probably a reason that we saw a very kind of a steady enrollment and interest throughout the execution of the trial. On the other side, I also do believe that with inclusion of all subtypes of dementia that definitely there is a large population of patients and that also reflected in cellophane in potential candidates for the trial study participation.
Sure. So maybe just to follow-up on that, I guess maybe what we're trying to understand is, if the enrollment and the pace of that is because of that large population or I guess in terms of the number of patients who are responding and moving on to that second portion, right, like you could have that could be the driving factor where you're seeing rapid progression of patients because so many people are responding to the drug in the open label portion?
Well, the response rates that we anticipated are based on the response rates that we were seeing in the Parkinson disease psychosis trials that we conducted. And as I said, we are seeing approximately probably slightly higher rates of response after stable response, I want to say, after 8 12 weeks of treatment. So that's certainly encouraging and I would not say that that may not play a role in the continued interest by the investigators in enrolling the patients in the trial. But it would be a pure speculation on my part to say to what extent is that, to what extent is overall design of the trial and to what extent is just this is a huge patient population.
Got it. All right. Thanks for the color.
Your next question comes from Ritu Baral of Cowen. Your line is open.
Hi, guys. Thanks for taking the question. My first question is a little, I guess, broader. How do you guys think about pricing, assuming either negative symptoms goes through, MDD goes through or Alzheimer's I'm sorry DRP goes through, how do you think of the current price and the current dose for PDP? And how might that flex into additional indications?
And have you done any proposition? More specifically, have you talked to payers about what relapse prevention clinical data actually means for DRP?
Great. I think there's several sub questions and then I'm going to
turn it over to Michael. I'll try to
keep you honest if you don't catch them all.
Fair enough. Maybe 2. Yes, so I guess the first place to start from a commercial perspective is really the unmet need that we're going after, whether it's DRP, adjunctive MDD, negative symptoms, these are all high unmet needs and the weight of the clinical evidence that we've seen, obviously, we don't have the results of the approval studies, but going into these studies, when we've done the research, we do see that there is a recognition of the commercial value or the patient value and the innovation. So there's a lot of innovation. The payers recognize that.
We have done research on each of those indications and we're doing what I would call multi indication scenario planning. Broadly speaking, without getting into too many specifics, you're mixing it we're having to mix and match folks of business with insurance companies. So for example, MDD has a larger footprint or weight on commercial. A DRP is going to be very similar in regards to our current PDP profile. And of course, schizophrenia is an entirely new ball of x entirely.
Despite all those things, we do believe there is a way for us to find ways to partner with payers for the appropriate access and know that we're not in any of these indications going up against cheap generics. We are playing in specialty tiers and that affords us the appropriate use criteria that payers are looking to see.
And if I may just add one thing, just not to remind everybody. In addition to our relapse prevention trial, which is a long term treatment trial, we also have positive data into acute short term trials that are done in a classical parallel design. So I think from the payers perspective and from overall looking at the data, we have a fairly complete package that is actually more approval.
Got it. And I do recognize my first question had about 4 different parts. By design. Serge, can you just comment on the characteristics of Harmony enrollment the background diseases? You had mentioned earlier this year that enrollment was sort of tracking on epidemiology.
Is that still the case or is it shifting?
Yes, it's absolutely the case. We, as you can imagine, follow that fairly continuously and both in terms of the enrolling people in the open label trial as well as people that qualify for that essentially respond and then qualify for a randomized double blind stage of the trial, we are tracking very, very close to epidemiological data on the proportion of different subtypes.
And I'm sorry if I missed it in your prepared remarks. Did you say precisely what your rollover to the open label rate is?
No, we did not I did not say a specific number. It remains at the same slightly above what we were anticipating, but thereabout.
Got it. It's fairly steady.
Thanks for taking all the questions, guys.
Your next question comes from Charles Duncan of Cantor. Your line is open.
Hi, Steve and team. Let me add my congratulations on what looked to be a very nice quarter. My first question was kind of related to guidance and I'm going to take a page out of Ritu's book and ask, call it, a multi pronged question. But if you look at guidance going forward, if you had to identify one particular driver of that, would it be prescriber base increasing? Would it be new patient adds increasing?
Would it be compliance increasing? Or would it be pricing? What would be the main driver to the guidance?
Charles, I'm going to ask Michael to answer that question. Sure.
Hi, Charles. Thanks for the question. Yes, going forward, I think we've created a lot of momentum, as I mentioned, in the business across all the levers that we're looking to affect adding new physicians, adding new patients, penetrating our long term care channel, both in the new pharmacies and deeper depth out of the existing pharmacies. So I would anticipate continued volume growth out of existing patients and also adding new patient starts would be the primary drivers to the forecast.
And maybe just to reiterate what Michael said. One of the things that we saw in the second quarter was a significant uptick in the take rate from existing patients. And so as Michael mentioned, we see that carrying through into the Q3 and the Q4 as well. Now the impact on rate of growth obviously is different than the higher base rate that we have at those compliance levels, but we did reflect that in our guidance for the remainder of the year.
That makes sense, especially given the clinical value of 34 mgs. If I could just ask one more question that would be probably of Serge related to the MDD program. Could you help us understand maybe the differences between CLARITY II and CLARITY III between the 2 Phase IIIs, but also those 2 Phase IIIs relative to Phase II? Are you using different sites or different entry criteria or anything? Because I think you mentioned that CLARITY-1 with one of the 2 Phase 3s would be sufficient for sNDA.
And so I guess I'm wondering if there's different probability of success for the 2 Phase 3s?
IIIs? The 2 studies 2 Phase III studies, CLARITY II and CLARITY III are identical with one exception. Clarity 2 is done in the United States and clarity 3 is done in Europe. In regard to the sites, obviously, our CLARITY study, Phase 2 study was done in the United States. And we naturally included in the CLARITY-two size those size that were performing well in the previous study.
So I can say that they are identical sites because CLARITY-two has a tad more sites. And also but there is a considerable overlap in that respect. So that's one. There are also in regard to design differences between Phase II and Phase III trials, there is not much difference with exception that I have to remind you, Phase II was SPCD design, so had 2 phases. Phase 3 trials are just parallel Stage 1 sort of design of the trial.
So there is no other differences in there are minor differences in terms of certain things that we learned in trial, but they are not really the trials are essentially identical with the Stage 1 of the Phase 2 trial. And in regard to the size of these trials, as you will remember, we had about 200 and plus a little more than 200 patients in Phase II. Here, these trials are 280, which is fairly close for the difference between Phase II and Phase III. And we were able to do that on a basis on robust results that we had in Phase II II and then accounting to continue to do a relatively smaller trial where we can control the quality.
And just to clarify with regard to CLARITY-three, pardon the pun, that is an ex U. S. Trial only?
Yes. Yes.
Okay.
Correct.
Thanks for taking the questions. Congrats on a great quarter. End of day. Thanks.
Your next question comes from Marc Goodman of SVB Leerink. Your line is open.
Hi, this is Roana on the line for Mark. I just want to ask a quick question. In the past, you've highlighted certain initiatives focusing on LTC. And we are wondering if you could add any color on those, such as what are their main goals and what percentage contribution do you see them making to overall sales? Has that changed at all from 1Q to 2Q etcetera?
Great. Michael? Sure. Thanks for the question. As I mentioned in my prepared remarks, the patient screening and care plan tools we believe contributed to the growth that we saw in long term care.
Importantly, in the long term care channel where you're dealing with more of an institutional kind of facility approach, Keeping algorithms and electronic health records are very important resident patient management processes kind of at the facility level. So what we've done is we've designed a number of different tools, disease education, patient screening, etcetera, that helps the facilities and its health care practitioners and the staff fit into their existing treatment algorithms and care pathways that helps them identify appropriate patients and more importantly helps them facilitate the documentation necessary as a heavily regulated environment. And I think we're well on our way to establishing efficacy with these tools as it relates to patient identification. In regards to long term care and what we see, just as a reminder, we have 2 segments of our business to channel the SP or specialty pharmacy reflects mostly like a community based physician setting and the specialty distribution setting or channel of which 2 thirds of that or 2 thirds of that 1 third is long term care. We've not seen any shifts in our historical splits of the business in that regard.
Great. Thanks. Thanks for that. Michael's comment, we've seen continued growth, including in this quarter in both the SP and SP channel. Yes.
Good point.
Our next question comes from Alan Carr of Needham and Company. Your line is open.
Hi, thanks for taking my questions. A couple of them. With respect to the 2 CLARITY trials, do you have any prospective biases in terms of which one of these might be more risky? Because I remember last week after the schizophrenia trial, you had mentioned that you had some concerns over European sites versus U. S.
Sites. Do you have any kind of bias for the for depression? And then the other one is, I think in the past you've said maybe on the last call you said about 15% penetration of 125,000 patients. What are your updated numbers on that? And do you think the 125 can grow?
Thanks.
So Serge, I'm going to Serge take the first question, Michael.
Hi, Alan. The short answer is, I do not have any bias one or the other way. And the reason for that is just a different condition. And when we look at the literature and the trials done, the picture with the major depressive disorder trial versus schizophrenia trial and placebo response rates being higher in the United States has probably more to do with the study participants that are more specific related to schizophrenia as a condition than major depression. So it is more depends on the sites, countries, circumstances of the trials than uniformly as it is seen in the schizophrenia trial?
Great. Michael?
Yes. Thanks, Don. Good memory. Those are, I think the right metrics you have in regards market share in the market of BEP. We'll be updating the FE forecast.
I would anticipate the 125 number will go up as you would expect with patient populations. We're going to update the model. But for now, we're staying with the mid teens as you had it and the 125 in the PDP market.
Great. Thanks for taking my questions.
We have time for 2 final questions. Our next question comes from Paul Matteis of Stifel. Your line is open.
Hey, thanks so much. This is Ben Burnett on for Paul Matteis. Just one more on pimavanserin. You mentioned a little bit about long term care clinics and adoption here. I was wondering how the compliance or the script per patient compares in long term clinics versus like academic or community centers.
Do you have any window into that or anything anecdotally that you've heard?
Yes. Great question. I would identify or just really characterize the long term care patient who has Parkinson's disease and then has Parkinson's disease psychosis is at a later and more advanced stage. And so the amount of duration of therapy, if you will, is shorter than we see in long term care than it is in the community, in part because of the fragility of the patient and the mortality and morbidity complications that occur. With that being said, though, the long term care facility also in part has a higher concentration at times of patients with Parkinson's disease psychosis than say a general neurologist.
So, there's kind of an offsetting element. There's more patients perhaps, but they're also a little less in terms of duration of therapy. But nonetheless, it's a very big opportunity for us to penetrate and get greater depth in that market.
Okay. Okay. Thanks for the color there. And I guess I just had one other question on the just the design of the Phase 3 CLARITY studies. Are there any details that you can provide, I guess, regarding the powering of the study on the HAND D rating scale?
Serge, do
you want to take that?
Yes. I think that there was in terms of the design and in terms of the powering, there were same assumptions, very similar assumptions that we made with our Phase II trial. So the only difference is these Phase III trials are powered at 90%. So that's really otherwise we made same starting assumptions in designing this trial. And I want to use this opportunity and thank you for going back to MDD trials.
To prior question, one other thing that I would add is important. People may wonder why did we do one trial in the United States and another trial ex U. S. Rather than mixing the two regions like it is done with schizophrenia. The simple reason for that is that assessment of depression, there are significant cultural impact on the plasticity of depression symptoms and that play and that may play a role in variability.
So staying within the region is well advised in that respect and that was the reason why we chose to go with this setup for the Phase 3 trials.
Okay. I appreciate it. Congrats, guys.
Thank you.
And our last question comes from Danielle Brill of Piper Jaffray. Your line is open.
Hi guys. Thanks for the questions. I guess I'll stick with MDD first. Wondering when we can expect an update on enrollment and the anticipated timing of data? And then going back to DRP, sorry if I missed this before, but just wanted to clarify, powering is based on an estimated responder rate during the lead in.
Is that correct? And can you remind me if there's utility component to the interim? Thanks.
Yes. Okay. I'll try 3 questions there. So I'll try 1 by 1. On the MDD trial, we are in early months of initiation of this Phase III trials.
Recruitment and interest is going very well in the United States where we started earlier. We are seeing a very quite a bit of enthusiasm for the trial and a positive data always helps in that, I would say. But it's going well. But we are just very early to make any more precise predictions on these trials, as we always say, take about 2 years, 2.5 years. And at this point, we would stay with that general kind of estimate.
But as we are recruiting further, we will be in better position and we will be reporting a more precise timing for the expectations of top line results. On the DRP study and assumptions for powering on the study, Actually, we powered the study on the number of events and the difference in the proportion of the relapses that would occur on placebo versus drug. So it's not really power on the response in the open label stage, but it's rather power on the assumption of what there will be a difference in the relapses between treatment arms in the double blind stage of the study.
Got it.
And then
yes, a utility component?
Yes. No, there is the interim analysis is design and statistical analysis that is being done as a part of interim analysis is designed around efficacy. There is a certain threshold of hazard ratios or P values that you need to reach in order to declare that the efficacy is demonstrated and start a trial would stop for efficacy. Obviously, this trial, like other trials that we conduct, also has independent data monitoring committee that will receive this statistical analysis and inform us of the outcome of that analysis. But there is no futility statistical analysis.
I do want to say Data Safety Monitoring Committee for a variety of reasons have always ability to stop the trial for one of the other reason. But there is no futility included in the interim analysis here.
Great. Thanks for the clarification.
Mr. Davis, please proceed to closing remarks.
Great. Thank you, operator. Thanks to each of you for listening in today, and we look forward to updating you on our progress next quarter.
Thank you for your participation in today's conference call. This concludes the presentation. You may now disconnect. Good day.