Be introducing Axsome, our next company presenter. We've got Mark Jacobson, Chief Operating Officer, and Nick Pizzie, Chief Financial Officer. 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. It's nice to be able to chat with you.
A lot going on at Axsome. Recently, a high profile new indication approval for AUVELITY, and 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, it's coming from a place of just what the current state of the business tells us as opposed to being, you know, feeling extra bold or bullish. It's just the state of the business and we can talk about that. To your point, starting with the label, this, you know, 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. That ties to the need in Alzheimer's disease agitation, as, you know, 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. Maybe Nick, do you wanna start there?
Sure. For MDD , hours and that's 14 quarters into the launch. As a reminder, we started the launch with 160 reps, a very small amount of reps compared to our competitors. That number has grown from 160 to 260, most recently 300. We just did the expansion from 300 to 630 in anticipation of the ADA approval, 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, you know, 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. Really pleased with where we are with, from a payer access perspective. 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 liked the returns that we had, we did that with less than 300 reps on board. 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.
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. NBRx obviously being a leading indicator where we expect to be from it, from the Ts, 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.
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, etc . 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?
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. Can you unpack that? Are there different analogs you look to to derive comfort around this idea of synergy, given that it could be somewhat different prescriber or lack of prescriber overlap?
The for analogs, you know, the the the ones you mentioned are are fine. I don't know that we'd point to any others as being being our internal justification for where our modeling put points us. It's, 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, and try and educate those targets. That, that is kind of the targeting analysis. It's not predicated or based on another analog and how it did, but where do the synergies come from? 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. Also just in long-term care, you have high rates of depression, right? 50%-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. We'll be doing that now, so you could very, you know, very directly see that just educational efforts would be beneficial and synergistic in that area, right?
If it's say one call or one medical presentation where you can talk about both indications, I think that's straightforward and it's similar in a community-based setting where, you know, Nick talked about our investments in the sales force. We're going out further into primary care, depending on where you are, you do these analyses you know, urban centers, rural areas, in certain, you know, whatever geography you're in, you can do the analysis. Who are the targets? Is it primary care? Is it psychiatrists? Is it neurologists? It turns out for both indications, the bulk of prescribers are primary care and then psychiatrists.
Then for Alzheimer's disease agitation, you do have some neurologists, geriatric neurologists, etc. , but the bulk is primary care. What we see and what we've seen since launch is when there is trial by an HCP and in a certain number of trials in a certain period of time, that leads to adoption. You know, 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. Now that we have this large expansion in the sales team and investment there, 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 - 300 reps. The idea there was to be more in primary care, we saw a significant increase in NBRx, you know, called four to six 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. If you think about our target list, when we started, it was really specialty. It was really heavily on psych, we are now just recently getting more heavily into primary care. 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. Now the ADA market itself, right? There's 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? You know, when I look to MDD, psychs always say drug's got to be super safe in MDD, right? It's just a critical table stakes almost, right? 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. It probably starts with the mechanism, right? Mechanistically, it's highly differentiated and, you know, it's first in class. It targets NMDA and sigma-1. That's highly differentiated from on and off-label pharmacotherapies that are used for these patients. What does that lead to? You see differentiated or distinct efficacy and tolerability profile. You know, in the label, we have parallel group efficacy data that shows the product works quickly and separates very early on, so two to three weeks and then we have data r elapse prevention data.
This is duration of effect and treatment effect over longer periods of time. That's highly differentiated for on and off-label, what's used now. The tolerability profile is great in terms of pairing with efficacy like that. 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, you know, sedation. We don't see a mortality signal. We don't see a fall signal. The list goes on, right? If you look at the most common AEs in the label for this patient population, it's dizziness and dyspepsia. That's it.
It's a very tolerable pharmacotherapy for the level of efficacy that you see with it. That's great. That also, you know, to further make the point about synergy, when you have trial and if the real-world experience matches the clinical data, that's a very different option for patients and, you know, caregivers and prescribers than what's been available to date.
Okay. You have 600 sales individuals now that are gonna be promoting both the ADA and MDD indication. How are these sales individuals gonna be prioritizing? Is it the new indication gets more of the love versus, say, MDD, which is more established now at this point? You know, is it gonna be very context-driven depending upon the provider and their practice and, you know, where the opportunity could be to drive business?
It's, it's the latter. It's, it's context-driven. It's, it's by target and by region and geography. Every account manager has a mix of targets who are primarily, "MDD target" or an AD agitation target or they're both. That will drive their call plan. It varies, but every team member will have that mix of targets.
It seems important to mention, so you'll launch in June. 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. Maybe just level set for investors what that coverage dynamic's going to look like day one, right? In this largely Medicare Part D population, both in terms of ease of access, quality of access, step throughs, etc .
Sure, yeah. 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. We feel very good about coming out of the gate with coverage, specifically in ADA. The other 25% of the lives that are covered would have a PA, we anticipate the majority of those that do have the PA would just be PA to indication. It's not a heavily burdensome for the HCP to be able to write the product. That would be also with first, basically, first switch or potentially something after that.
Overall, 100% covered lives. Typically, the next question is gonna 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. That's really only due to there's no co-pay coverage allowed in Part D compared to commercial.
Maybe next question is one, for lack of a better way of saying it, I'll call it plumbing in this market, right? Like, where you got an individual, they're Medicare, they're in a nursing home, they're in a long-term care facility. They have this access, but, like, the facility that they're in, the ability to write the script and, you know, seamlessly ensure that access is obtained. Is that an awareness thing? Does your sales team need to work with practice or 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. We, of the 630 reps, there will be a portion of them that will be dedicated to long-term care. We look at those specific reps not as the typical specialty rep or primary rep. It's more of a key account manager. To your point, Jason, there's a bit more work in hand-holding 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.
Yeah, I don't have much more to add to that except the, you know, the plumbing, maybe one way to say that is just, is that really ties to supply chain. 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 wanna make sure the product can, that script can be filled and that the product is there waiting if, you know, when the script is filled. That is, that's been, you know, that's behind the scenes or, you know, " back office". We've been attending to that, and we feel good about the infrastructure in place there.
Got it. Maybe just how would you frame the patient out-of-pocket cost dynamic for these subsets of this population, be it, those with minimal out-of-pocket versus those that may have an If you've got a blended average?
Yeah, sure. 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. 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-$5, and I believe it's also voluntary. 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. They have the ability to cap and smooth, and that relates to any drug that they are taking.
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. Overall, they're 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 t hat would improve as the year goes on.
For us in the analyst community, how would you envision tracking the launch? Is that gonna be something that will be discernible from the script data or on the quarterly updates, how you'll plan on educating us on the launch trajectory?
The weekly scripts will be there. The, you know, scripts that are written for patients with Alzheimer's disease agitation, those will manifest or show up in weekly scripts. We will monitor that the same way through weekly scripts, and then we'll have additional data that we can see through our, you know, sales infrastructure or, say, retroactive claims data. One thing you can or folks can monitor or if you get scripts by channel, say, you know, Medicare Part D or, you know, commercial channel. Folks can watch that. We'll see what we can offer for commentary.
You know, 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.
In, you know, 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. 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. I think that that's probably the most important.
Yeah. Okay. Shifting to MDD, curious, you know, you're four years now, I think, into the launch. You know, 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, you know, one or two 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. How would you frame, if you could, you know, at a high level, what has to happen to get to that $4 billion target?
It's based on current trends and uptake. You know, for obviously 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. We're investing further to go into primary care further, as we talked about. If we see adoption there at the rates, at the pace, the rates we see, the persistence and compliance we see, if that holds up, then those are the numbers we'll see. It's not predicated on, you know, threading some needle of some certain, you know, some patient profile.
It's where the coverage stands today, which is great for just a few years after launch and how we expect it to continue to grow and evolve over time. It's the investments we'll make in the sales team and then how productive we've seen that those efforts to date and to see, you know, to see that continue. It's not, you know, those numbers aren't, it's not a Rube Goldberg contraption that one thing has to one precarious event leading to another. That's the product profile.
If you just step back, Nick touched on where we are with the overall market. It's not even half a percent. It's barely half of 0.5% , right? 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, you know, that's the numbers that we'd expect.
We're 14 quarters in, right? We have exclusivity through early 2039 with pediatric indications. 14 quarters in of 66 quarters. Who's counting? That's less than 20% of our life currently, right? We feel great about where we are and, you know, analyzing a $600 million with a team that on average was somewhere in the neighborhood of 200- 250 reps and mediocre market access up until really last year. You know, we've been laying the roots and the foundation now for the three years with this approval, with the trajectory that we've seen.
Now I'm gonna use a word in Vegas, I'm gonna say we're going more all in now because w ith the team and with, you know, the investment that we did in Q4 in DTC, we'll see. You know, we'll continue to add that investment. We don't anticipate that it's going to, you know, significantly increase from where we were in Q4. We've laid that foundation now and we feel really great and, you know, we've shared that it's an $8 billion+ number. It's not a max out at $8 billion, but it's an $8 billion+ .
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. 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?
Yeah. We did DTC in Q4. We had a lot of learnings from that. One of the learnings was where to place our ads between linear, which is the traditional over-the-air TV and digital TV. You know, 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, you know, out there twenty-four seven 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 w e will continue to invest in those areas. I think we've gotten smarter. We started a campaign again in March, and we'll have a campaign throughout the rest of this year. It will always be disciplined and discreet, regardless if You know, where we are today versus in three years from now. I would agree, we'll always have a presence out there in one way.
Yeah, what Nick's talking about is to us. We're looking to make the most sound or best ROI decision. For us, the best ROI, it's the sales team. That's where we're investing heavily. We'll invest in other elements, which, you know, is traditionally described as surround sound, and so we'll have that. It's being done. The track record for the brand to date speaks to that approach that you can drive very high performance with disciplined, say, commercial investments. We'll continue to do that. You're right, as it grows, you know, we'll change the mix of those investments over time.
Okay. We got about four minutes, some quick hitters here. I'll cut to the chase. SYMBRAVO, you know, the early efforts are on the access build side. When do you think investors should be looking to a sort of 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. We announced that we had a nice win in Q1. As access comes online, you know, we expect to see an inflection with net sales. We had nice script growth quarter-over-quarter. Sequential script growth I think was around 36%. Anecdotally, we've heard nothing but positive feedback as it relates to SYMBRAVO. It works really well. Safety profile has been positive so w e'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 on 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.
I mean, this probably goes without saying, but it's a much different market and from depression. It's the launch, you know, Nick is talking about our data-driven approach to investing. The launch and how you navigate that market is much different from an access perspective and trial and treatment options. You know, we've always shared that we're starting discreetly so we can understand feedback from clinicians about the product profile, which Nick touched on, also the, you know, for, maybe for plumbing or the inner workings of that marketplace. We're wrapping our head around it, and now we're investing further. We, you know, we'd expect to see, you know, growth, moving forward.
SUNOSI ADHD, can we just talk about the, 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. It seems like you're kind trying to offer something in between what non-stimulants are and what stimulants are, I'm just wondering how high the efficacy bar is.
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 stimulant. That's great. You know, 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 two trials in children and adolescents. We'll have to wait for the data.
Right now, you know, there's real world experience, obviously, for the on-label indications. There's the clinical data in adults. We have a sense of the efficacy and tolerability profile. The scheduling's different. We see, there are other data that we have in hand, right? That it The cognitive benefit that we saw, we shared that through the SHARP study. That was a couple years ago now. That was in individuals for the current on-label indications. That again speaks to the differentiated product profile. we've got to finish these two studies, and we'll be providing updates on them t hroughout the yeart Then we'll turn the cards over and see what we have.
Already we know the product is differentiated from what's available, which is great. Then, you know, providing different treatment options to clinicians and patients, that's our job. Then, you know, if the product is approved in the indication, then our next job will be to educate clinicians appropriately. Already it's a differentiated product profile, so we're excited about its potential. We just have to finish the clinical program.
All right, great. Well, we're out of time. Gentlemen, thanks so much for joining us.
Thanks for having us.
Yeah.
Thanks, Jason.
All right.
Have a good day.