All right, thanks very much. It's my pleasure to be moderating this chat with Kyle Gano, CEO of Neurocrine, and Todd Tushla, head of IR, who I made the joke is also moonlighting as an air traffic controller right now with his headset.
Well, I thought you were gonna talk about my green shirt for St. Patrick's Day, but that's.
No, you look great, man. That. I like the shirt. Yeah, sounds good. I mean, I think, obviously anyone listening here knows the story well, but, you know, Kyle, do you wanna just kinda give us a couple minute sorta snapshot of 2026 as a big year for Neurocrine, and then we can do Q&A. Does that sound good?
Yeah, it sounds great. Thanks, Paul, and thanks to Stifel for having us here this afternoon. So yeah, if I look at 2026 as we exited the prior year, we're entering this year with a great deal of enterprise-wide momentum, and this comes on the heels of an expanding and diversified portfolio that we're executing on this year with an exquisite focus on delivering a lot of data next year in 2027 phase II and phase III trials, which would really represent the first year of many years to come where we expect data flow just like we're anticipating for 2027. That's not to say there's a lot going on this year, but it is one of execution and performance.
Last year, if you look at the commercial side of the business, we had just north of $2.8 billion in revenue. That's about 22% year-to-year growth, which is outstanding. That comes with the benefit of chronicity adding to our top line each year now moving forward. As a good reminder, when I talk about chronicity and our revenue, it's our ability to diversify Ingrezza over time. We had about 12% revenue diversification on top of Ingrezza last year in 2025. A great way to think about the company as being a multi-product diversified biopharmaceutical company moving forward. Just to tick off a few things about our individual commercial products. Ingrezza, eighth year into commercialization, we saw $2.51 billion in revenue.
That's about a 9% year-over-year growth, double-digit volume growth on the year. Record NRX over multiple quarters. It was a great year by all accounts. A little bit of a hit on gross to net there on our net price per script with some contracts that we took on in 2025, but we make it up this year with a really clean year from a contracting perspective and access perspective. This year, we're guided to $2.7 billion-2.8 billion in revenue, and we've got the focus here in a couple different areas. I just alluded to one, taking full advantage of the access that we acquired last year throughout 2026, leveraging our sales force expansion, which will be live in Q2.
There we'll be looking at going deeper with existing prescribers as well as meeting new prescribers now on the antipsychotic side of the business. We've got about 30% new prescribers over the past couple of years that we weren't calling on. We'll be able to reach those for the first time. Also other sales initiatives, including a new DTC campaign that will come out later this year. We're really excited about the opportunity that's out there. Good reminder, 10% of the 800,000 patients are on a VMAT2 inhibitor. It's a lot of growth out there that remains, and we've got IP out to 2038 to support all the growth that we see in the product.
For CRENESSITY, switching gears a little bit, first commercial or first year of commercial sale, $300 million in revenue. Last year, we had about 10% under care of CRENESSITY of the entire CH market. That's a great milestone, but also means there's 90% of the market still ahead for us. By all accounts, every measure that we look at, we exceeded all of our internal expectations this past year, starting with, you know, reimbursement rates that were high. 80% of dispensed scripts were reimbursed. We saw very good persistence throughout the course of the year, and it really sets us up well for a strong second year, 2026.
We're looking to continue supporting the educational needs of physicians and patients to hopefully change the standard of care in CH just much like we've done with Ingrezza and tardive dyskinesia. We've got plenty of time to do that with IP out to the early 2040s. So that's the commercial pipeline. We've got an industry-leading neuropsychiatry portfolio. Osavampator and direclidine will deliver phase III data in 2027, in particular, the second half of 2027 and early 2028 for direclidine. We've got a number of phase II programs that will read out over a similar timeframe. NBI-570 is our M1M4 dual agonist in schizophrenia right now. Of course, our VMAT2 efforts in terms of getting a next generation inhibitor are moving along in the pipeline nicely as well.
NBI-890 is in a phase II trial that will read out towards the end of next year. A lot on the commercial front, a lot on the pipeline. I'll stop there in terms of the highlights. We really are focusing on execution this year to deliver the data across our phase II and phase III programs in 2027.
Yeah. Okay, great. Maybe as it relates to the Ingrezza guidance, right? I think you guys said that price is gonna be flat. Is that right?
Yeah. Just to recap on the guidance for this year, $2.7 billion-2.8 billion. When we look at the guidance, whether it's, you know, this year or years past, obviously, we look at trends leading up to the time we're having those discussions internally. It really comes down to the pace and cadence of NRXs as well as what we're seeing on TRX the prior year, and then the timing of sales force and other marketing initiatives that happen during the course of the year. When it comes to specifics on NRX in particular, we think about this year, just a couple of things to call out.
We'll be looking at about a 4-5% price decline year-over-year for the expanded access that we have now to be maintaining that throughout the course of 2026. That 4-5% decline is relative to what we saw exiting 2025. In Q1, recall if we reflect back in Q1 of 2025, the differences in our business is that we brought on a couple of contracts. We did take a hit on the net price per script. On a Q1-to-Q1 basis, that decline on a net price per script is about 10%. We have those, I'd say a little bit of a headwind there throughout the course of this year, about 4-5%.
You do see a difference in.
Is that you, Kyle? I thought at one point you guys thought.
I'll just clarify. I think, Paul, I know where you're coming from. It was flat coming out of the second half of the year.
Yeah
of 2025, so we had entered into those contracts over the course
I see.
of the second half of the year.
Yeah.
Coming out of the end of 2025.
On a blended basis for the whole year is what you're talking about.
That's right.
On a blended basis.
I think that's helpful context for everyone's model.
4% full year.
Yep.
Yep. Makes sense.
To repeat the biggest hit, like Kyle said, the biggest headwind is the anniversary heading into Q1, where you're gonna have somewhere around a 10% price hit, but that recovers a bit into Q2, and then you're on even ground in the second half of the year.
Yep.
Yeah. Okay.
Other than that, I mean, we're looking at another strong year. We anticipate, you know, double-digit volume growth this year, just as we saw last year. With the price per script relatively flat over the course of the year, as we just described, we're expecting a nice strong year for the brand.
Just looking ahead to 2027, do you feel like there's a lot of uncertainty on where the price of Ingrezza might be going? Like, do you feel like you're gonna get more information in how plans are gonna be dealing with the Austedo MFP or is-
Yeah.
'Cause I think on the market side and the investor side, this is seen as a big source of variance, but I'm wondering if you also see it as a big source of variance.
I mean, the way I think about the IRA, there's really three periods here when we think about Neurocrine. There's 2026 or what's left of it when both Teva and Neurocrine are not in the period where either company's observing or implementing an MFP. There's 2027 and 2028, where Teva, our competitor in this space, has their MFP implemented, and then there's 2029 when Neurocrine has its MFP implemented. This year, relatively normal year for us. We've got great access. 70% of TD and HD patients are under the contracts that we have with plans today, so it's a really good place for us to be. That's why I go back to my earlier remarks and maximizing that now in combination with the sales force expansion that we have ongoing. That's good.
When it comes to 27 and 28, that's the Teva MFP implementation period, where we're not in the same situation. When we look at what happened with Teva and Austedo, we feel that it landed in a pretty good spot, right within the range that we had planned on internally in terms of their discount to their 2024 WAC, which was about 38% or which was 38%. That's a pretty good spot for us, and we know that we can manage through that and can still see really good growth for the brand. When we think about our actions and our own activities this year, we're not expecting any midterm or mid-year ads like we saw in 2025. It's stable now this year.
What our focus and attention is is negotiating with those Medicare plans now for 2027. Those things or those discussions are ongoing, and we'll have an update on where we land with them later this year. Again, that will be for contracting for 2027. We believe that there'll be a place for adjacent MFP products in these Medicare plans moving forward. We've already heard and seen that from other brands that are out there today. We know that we'll be able to manage through the next year in 2028 quite well. Then we have our own MFP implementation and IRA activities that will be supporting our 2029 year.
Yeah. Yeah. Okay. Makes sense, Kyle. As it relates to CRENESSITY, how are you setting the expectation of what could be a good outcome this year? You know, I think on the Wall Street side, like, you know, everyone knows that the ad rate is gonna settle into some sort of steady state number, but the question is when is that going to happen? You know, it feels like this is one of those launches where people are gonna be emotionally sensitive to very small differences in start forms. How are you kind of like helping people think about like where this hits the trajectory now that we're past the bolus?
I have two cents on that. The start form piece was a big point of the Q4 call for exactly the reasons you highlighted. I think if you're close to orphan launches, it's very typical to have a nonlinear path for new patient start forms. That's what we expected. That's what we saw. The new patient start forms internally beat our expectations with each passing quarter in 2025.
To have that, get to 10% of the patients in year one is a super strong start, and I think our expectations are if you combine what we're calling steady ads, and so I get that question quite a bit from Street is, "Well, what do you mean steady?" By steady, we look at it weekly in 2025, not providing any guidance for this year, but for 2025, what you saw were double-digit ads throughout the course of a quarter. Now they varied across Q1 through Q4, but we never had an instance where you put up a zero in one week and something like a 50.
Right.
It was nice, consistent double digits. As long as you continue that into this year and combine that with what Kyle mentioned from the outset, very strong compliance and persistence, at least through year one, in line with what we saw with the open label extension, combined with strong reimbursement, I think this is the year, perhaps this quarter hopefully, where people have less emotion about the new patient starts, and you're looking at the trend line in net revenue, which is gonna be an upward slope.
Yep. Yep. Okay. I'm always prepared for like a first quarter for Neurocrine that is a little confusing on either like Ingrezza or reauth or something like that, or selling weeks, and then I'm always prepared for the 2Q set up to be great. Anything we need to keep in mind with 1Q and any complexities in sort of interpreting the upcoming quarter?
We know for Ingrezza, we go through the reauthorization quarter. There's always noise around that.
Is that better now that you guys have paid up for all this access?
There's still the piece of patients having to go through their process of getting their prescription refilled. That doesn't change. They still go through that dynamic each year. We see that across all specialty medicines. It's not something that's unique to us. In fact, we often look at other branded antipsychotics and see what their patterns look like, and not surprisingly, VMAT2 inhibitors and antipsychotics kind of move together in terms of their ups and downs on an annual basis. You have reauthorizations through Q1 for Ingrezza, and then you have the pay down for the commercial plans for CRENESSITY in Q1.
That gives you a little bit of a gross to net hit that, but that works itself through in Q1 as well. We don't give any other inter-quarter guidance beyond that, but I'm looking for good years for both Ingrezza and CRENESSITY, and I think we touched a bit on the ebbs and flows in orphan drug launches. I'm sure you've done this work too, Paul. If you look at orphan drug launches that have some of the redeeming qualities of CRENESSITY, we're certainly on our way to a blockbuster status category based on first year performance, and we wanna make sure we just continue focusing on that for patients, and I think we'll end at a good place.
Yeah. Yep. Okay. Very good. On the AMPA PAM, you have this great phase II data. You're in phase III, and I think the discounts that investors seem to give it are just, one, this sorta MDD is hard discount, and two, the dose response dynamic. It's like people want things to fit neatly into a nice box. You obviously have looked at tons of MDD datasets, from your time at BD and, you know, probably others maybe even at Neurocrine before I covered the company. Like, what makes you so confident that this is, like, a replicable dataset and that you know your dose going into phase III?
Well, first of all, I appreciate that there's gonna be uncertainty for any program in psychiatry. I think it's just the history of the space warrants the right level of concern because you have phase II trials that seem to look good. In phase III, they don't necessarily replicate. There are things that we're doing to ensure that give us the highest possible chance of succeeding, but I appreciate that history. I guess I'd point to two things, three things when it comes to our own program. Number one is that we're working already in a validated pathway, and that validated pathway is by ketamine and associated NMDA receptor antagonist. You can go back 50 years through, you know, things like PCP that run through the same NMDA pathway.
It's one that's been well-paved. So you have that confidence knowing that you're leaning into that out of the gate. Number two, we've also been part of that validation with our phase II data in and of itself. Now, where our AMPA-PAM or potentiator operates is downstream of the NMDA receptor, but it requires the same messenger, if you will, to activate the system, which is glutamate, and that's what we're utilizing here moving forward. The last one is that our own phase II data was spectacular. I know we often describe an inverted or a an irregular dose response, but in our view, both doses worked. This was a small signal-seeking study, not necessarily trying to get a P-value on each of the doses that we used, but that could have been probable.
That would have been the case if we would have had a larger sample size here across both our 1 and 3 milligram doses. Overall, very robust result. We moved forward with the 1 milligram , but just to recap the efficacy here, we saw efficacy that improved from day 28- 56, so there's an improvement or there's a robustness that continues to expand in terms of the efficacy magnitude over time, which is compelling, suggests that the longer that you're on the medicine, the better you'll do.
At day 56, we saw very robust results of about a 4.5-point at day 28 MADRS improvement and then 7.5 points at day 56 with an effect size that ranges from 0.55-0.75. Of all the medicines that I've reviewed over the years, either in our pipeline or externally, I've never seen that robust of a result. We're quite pleased with that in addition to all those additional things about working in a validated pathway that give us comfort.
The goal then for us in phase III is to replicate that signal, and to do that, we try to lean into things like simplicity and trial design and also trying to not go too far from where we were in our phase II trial. In this phase II study, we used two doses, about 40-45 subjects each versus about 80 subjects on placebo. In our phase III trial, we're gonna be one to one active to placebo and about 100 subjects of active versus 100 on placebo.
We really are dialing in to maximize both the signal and the statistics here in the phase III trial design with a similar number of sites, similar geographies, similar team that's doing the oversight, and that should ensure that we are giving this program the best chance to succeed. Well, I'll just add what's torpedoed a lot of these programs in AMPA have been the safety margin, right? And here we've studied this molecule up to 18 x the dose in SAD/MAD studies so versus the 1 mg got up to 18.
Yes.
The safety and tolerability profile in the phase II SAVITRI study was great. This seems to be behaving nicely on top of the efficacy that you're going to get.
Like, some of these other AMPA PAMs that have run into seizure issues, have any of them shown, like, clinical proof of concept in mood disorders that would help corroborate this result?
No. The reason why is that typically, and this is a little bit nuanced, when you see a seizure in an animal model or in tox studies, typically you're given a tenfold haircut on your margins by the agency, so they're never able to push the dose to the efficacious range in terms of exposures in phase II to show an effect. That's just been a very unfortunate kind of drawback on molecules of this mechanism. In fact, this is the second one that Takeda brought to the market.
Recall this is a program that we in-licensed from Takeda, and they did an outstanding job really profiling molecules in the space, not only their own, but others, to really drive or dial into a molecule that behaves like a potentiator or a positive allosteric modulator versus an agonist that would overactivate the AMPA target in the system, and that gives rise to the seizure findings. It's a good point to mention here that AMPA antagonists, so the opposite of what we have, actually prevent seizures. That's Fycompa.
Yes.
It makes sense that if you overactivate the system, you would cause seizures. That's been the challenge of our industry is to get true potentiators or PAMs.
Yep. Okay. You're running a huge program here, multiple studies. The first is reading out 2027.
Second half of 2027. All of them will read out.
All three of them in 2027.
All of them will read out in the second half of 2027. Is that two parallel group and one randomized withdrawal? There are three placebo-controlled trials and one randomized withdrawal. The randomized withdrawal study, we have one in the direclidine program as well, really help more from a payer standpoint than anything else. We'll have all the placebo-controlled study, the results out, well in advance of that one. Obviously in psychiatry, you know, related to how we started the discussion is risky, and we have a more traditional program in terms of the number of studies that we're working on here, doing three and looking to get at least two that hit positive.
Do you think this 2B has any regulatory utility that you already completed?
You know, our work out of the gate when we started this phase II trial or the Savitri trial was that it would not be a pivotal trial. It's a smaller exploratory signal-seeking study. We're really trying to magnify what we could see in the MADRS. A lot of the other measures that you'd want in a placebo-controlled trial, phase III for payers or for other means of fully exploiting the profile of the molecule weren't in this phase II trial. So it's not something that we've planned on leaning on. To that end, you know, as we mentioned on the timing of the phase III trials, they're all going to be more or less reading out on top of each other.
The value of leaning into a phase IIb trial or phase II trial may be less given what we've got going on right now. I know that a lot of the questions that we received in this area pertains to the openness right now maybe of the FDA of looking at a plausible mechanism to bring in.
Who's asking you that?
One pivotal trial. I don't know if that's going to be a case here, but I'm just acknowledging that that's there.
Yeah.
I know a lot of other companies are trying to figure out what that means.
Right. I don't know. To me, I'm just, my thought is like these parallel group studies can fail if you already have one in the bag, and then you're doing a randomized withdrawal study, which, you know, has a good chance, right? Like you're already far along the way, right? But yeah. Okay.
Yeah.
People have talked a lot about the muscarinic. I actually wanted to ask you just quickly, you have a next-gen VMAT2 that no one really talks about, right? Look at what Austedo XR has kind of done to that franchise. How are you framing that opportunity? Like, is there something like an XR Austedo analog with the Ingrezza franchise with your next gen?
Well, it's been really difficult to get something that has a better profile than Ingrezza. It's once a day, has a lot of redeeming qualities. I mean, the things that we're working on for the next gen really are working at the margins of things that someone could poke at for Ingrezza. The overarching theme for the next generation molecules are potency, once daily dosing and low total daily dose. The goal here is to drive an additional product that would be married to the oral that would be a long-acting injectable. You'd be surprised how much we hear from physicians of desiring that type of formulation to help with compliance in those patients side by side with their antipsychotics.
That's been something that has been the top priority for us in a next generation approach. We've got two shots at doing that now with NBI-890 and NBI-675. 890 is in the lead and just started a phase II trial in tardive dyskinesia, and we'll have data on that second half of next year as well. Goes back to our data rich 2027. The idea there is that you'll get the exposures that are commensurate with efficacy, and you'll be able to start a long-acting injectable program around that just using that exposure range as a guide.
Yeah. Okay. On the muscarinic side, I think there's been enough conversation for now just on kind of interrogating that, the M4 data set you had. Where are you with the M1M4? Do you feel like that might have a higher POS? Like, do you like the dual more?
We are very excited obviously for direclidine. We wouldn't be investing in it in the way that we are if we didn't think it had a lot of redeeming qualities over the current competition in the space, which is Cobenfy. But what we wanna answer ourselves and we'll see here in early 2028, the dual molecule that we have in a phase II trial now for schizophrenia is NBI-570. There's been, as you've heard from us and others, this concept that M1 is for cognition and M4 is for psychosis, but can they benefit each other in a complementary way in either one of those areas if you're looking at a single indication?
By that I mean would you get more efficacy by adding M1 on top of M4 into a disease of psychosis like schizophrenia? Or would be adding M4 on top of an M1 give you some benefit in a patient population with Alzheimer's? These are things that we're gonna be able to answer, and we see that from our phase I studies, all of our agonists have completely different profiles. I mean, one of the things that's nice to see is that all of them are gonna be able to be dosed in phase II and phase III without any formulation work once a day. You know, different profiles overall, we'll be able to see what those look like in the different patient populations.
The dual's a little bit ahead of the other molecules, so it's in that phase II trial now for schizophrenia. We also have another type of dual, different ratios of M1 and M4 in NBI-569 that we've earmarked for Alzheimer's disease psychosis, and then we have a more traditional M1 agonist in development for Alzheimer's disease cognition. We feel confident.
How fast could you move, Kyle, with the dual in AMPA, assuming this, you know, we see a signal from Cobenfy or something like that?
We'd be able to move into a broader phase II trial, probably beginning of next year. What we're doing right now in phase I, which we think is gonna be a differentiator in and of itself, is show a good safety and tolerability in the elderly population with NBI-569.
Yeah.
That will also help us triangulate the dose and dose selection for our larger phase II trial next year.
Yeah. Yep, okay. Anything else you wanna highlight that you feel like everyone's overlooking or not appreciating that you are enthusiastic about?
I'd highlight probably two. You captured one here, the next generation VMAT2 program. I'd also highlight our next generation program for CAH, which is NBIP-1435. That's another program that's gonna move rapidly through the clinic, given our experience in CAH. It's in phase I now, but we'll be moving into phase II, III later this year, and that's something that could be a near term commercial opportunity over the next, you know, four or five-year period and offer something different over chronicity in much the same way.
What's the mechanism of that?
It's a CRF1 antagonist, but it's a long-acting injectable.
Interesting.
It is offering something completely different than our oral, and we're excited about that one. Related to CRF, we also have our diversified view of moving from CRF1 as an antagonist to CRF2 in CRF in metabolic disease, in particular PCOS that will deliver data and patients in the next year as well. We'll see how that approach works and you know some things that I know that people are interested to see.
Yeah. Yep. Okay. Well, great. Well, thank you guys. I really appreciate it. It's always good to see you, Kyle and Todd. You always make me chuckle, so it's good to see you too, man.
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Yeah, there you go. You know, I think our story is simple, Paul. It's a growing blockbuster, one in the making, an expanding diversified pipeline, a lot of data in 2027, sustainable innovation engine, and a strong financial profile position just like Todd mentioned.
Yeah. Okay. Well, great, guys. Thank you so much.
Thanks for your time.
Have a good rest of your day, and we'll talk to you soon.
You as well.
Thanks, Paul.
Thanks, everyone, for listening.