Axsome Therapeutics, Inc. Stock

Good morning, everyone, and welcome to the H.C. Wainwright 28th Annual Global Investment Conference. I'm [ Katherine Dagan ], and I'll be your moderator for today. It's our pleasure to welcome Mark Jacobson, COO; and Nick Pizzie, CFO of Axsome Therapeutics. Thank you both for being here. Take it away.

Great. Thanks very much for having us, and good morning, everyone. Nice to be here and see you all. So we're actually going to take you through today and the corporate presentation instead of a fireside chat, we want to take a moment to really share how the business has grown and where it is in this very, I think, unique stage of development that we're pretty excited about.

First and foremost, we will be making forward-looking statements today or we may be, and we'd encourage you to read a full summary of the risks and uncertainties associated with our business through our filings at the Securities and Exchange Commission.

So with that, we'll get started. So Axsome Therapeutics, we are focused on central nervous system disorders, in particular, highly differentiated mechanisms of actions for areas of unmet need or that have been underserved in CNS. And that's -- we think about it for psychiatry and neurology. And the snapshot of the business today is 3 marketed products, Auvelity, Sunosi and SYMBRAVO. Auvelity is approved for major depressive disorder and recently, Alzheimer's disease agitation, which we are launching now, Sunosi for excessive daytime sleepiness in OSA or narcolepsy and then SYMBRAVO for migraine.

We'll talk more about each of those. We have 6 differentiated product candidates in development across 10 different indications in psychiatry and neurology. So we're very pleased with that and the state of the business. We have trials ongoing in smoking cessation, ADHD, binge eating disorder, major depressive disorder with symptoms of excessive daytime sleepiness or excessive sleepiness and fibromyalgia and shift work disorder. We have programs that are on deck or in the works for schizophrenia, epilepsy, and we are also looking at Tourette's.

And then finally, we have an NDA under review with the FDA Division of Psychiatry for our AXS-12 product candidate in narcolepsy. So just the business has never been more robust in commercially or in the R&D side. And we'll take a quick moment to review recent business highlights. We reported Q2 last month.

And so Nick, I don't know if you want to cover a couple of items on...

Thanks Mark. Yes. So Q2, we did $218.4 million, which is a 46% year-over-year growth. That was really led by Auvelity, which recorded revenue of north of $180 million. Auvelity continues to grow. We recently did expand the team from less than 300 reps to north of 600, 630 if you include our long-term care team. And importantly, we -- in the most recent quarter, we received a new indication for Alzheimer's disease agitation, which is a lot of the Street's focus currently and obviously, a lot of focus for other, looking to continue to build the MDD brand and launch the ADA brand.

Great. And pipeline, I touched on some of the ongoing clinical trial work, but just to summarize, so 7 ongoing trials. We have an NDA for AXS-12, which I touched on. PDUFA date is May 1, highly differentiated. Again, that starts with mechanistic differentiation that flows into a distinct efficacy and tolerability product profile, and we look forward to keeping everyone updated on the progress there. We recently initiated 3 Phase III trials that smoking cessation for AXS-05, the SUMMIT trial and then the 2 studies of solriamfetol in ADHD, that's in children and adolescents. That's the FOCUS-2 and FOCUS-3 trials.

And as a reminder, we have a positive Phase III trial in adults that completed and multiple other programs behind those are complementing those. And then looking ahead, I touched on the PDUFA date for AXS-12. We then have top line results that we anticipate for the ENGAGE Phase III trial of solriamfetol in binge eating disorder in the fourth quarter. And then we've also shared that we anticipate top line from the shift work disorder trial of solriamfetol next year.

Yes. So a bit about -- in more detail on the numbers for Q2. As I mentioned, Auvelity led Axsome with $180 million. We've estimated that currently, we expect peak sales potential to be $8 billion plus, and that's roughly split between MDD and ADA. One of the things to think about is where we are currently. We mentioned $180 million in Q2, and that was really the effect of, as I mentioned, less than 300 reps. We've now doubled down, more than doubled down. We -- additionally, we have market access that is conducive to being first line or first switch in MDD as well as ADA and access in the ADA channel being every participant in Medicare Part D has access to Auvelity with north of 85% not requiring a PA and also being unrestricted to first line.

So we feel really great about the $8 billion plus number. And one of the things also maybe just taking a step back, we're less than 4 years in. We annualized based on Q2's numbers around $0.75 billion. And that was only with 0.25, that's less -- that's 0.25% of the entire antidepressant market with, as I mentioned, less than half the team that we currently have now. So we feel like this is the new chapter for Axsome. I think the first chapter was really successful, but now we're going into more of an overdrive, doubling the team, having the market access, making patients aware through direct-to-consumer advertising and expect to see accelerated growth in the coming years.

Maybe just a minute on Sunosi, too. Sunosi, $36 million in Q2 revenue, peak sales, $300 million to $500 million. And then SYMBRAVO doing $2.3 million, but did have a strong growth in Q2 versus Q1, 30% growth. The story there is just getting payer access. Anecdotally, we've heard nothing but positive feedback on SYMBRAVO, and the demand is showing that positive feedback, but it's just about getting payer access in this space, and we believe the peak sales there for $0.5 billion to $1 billion.

And then financial performance for the quarter. As you can see, the $218 million, 14% sequential growth, 46% year-over-year, very robust growth year-over-year. Importantly, the OpEx of $46 million and $208 million for SG&A. We anticipate that, that number has essentially plateaued going into the back half of the year. That's meaningful as we are approaching cash flow positivity and then profitability shortly thereafter. But the SG&A number fully encompasses the expansion that I mentioned for the sales team for Auvelity.

We do anticipate R&D to increase marginally from the $46 million number as we continue to develop the Phase III assets that Mark mentioned earlier. The balance sheet is super strong, $320 million as of the end of Q2, strongest and healthiest position that we've been in since inception. And we also put on here the shares outstanding, $52 million, which I think compared to some of our peers that are in that $10 billion to $12 billion market cap and where we are with the current commercial products as well as our pipeline products, we only have 52 million shares outstanding. We've been very sensitive to dilution. Even with the dilutive shares, you're at 60 million total share count or roughly 60 million if you include the employee stock option plan. And one other note maybe to think about is the cumulative deficit for the company is $1.2 billion or $1.3 billion. That is from inception. That is from 2012, again, a small fraction just how we think financially about investments and how we deploy capital.

So if we look at the commercial products, we'll -- just to be mindful of time, we'll be somewhat abridged here, but Auvelity. Obviously, this is what all eyes are focused on -- and the feedback we received from folks like yourselves, but oral NMDA receptor antagonist, this is the first and only oral NMDA receptor antagonist and sigma-1 agonist for both major depressive disorder and Alzheimer's disease agitation. In MDD, it demonstrates a rapid onset of action, robust and durable efficacy and a distinct safety and tolerability profile. And -- so that's the clinical program we saw now with 4 years on the market, that's the feedback we get from patients and prescribers that the drug works really well. It's differentiated from an outcomes perspective or an overall profile perspective and that we see when patients and prescribers try the product, it leads to very robust adoption.

And Nick touched on that we've expanded the sales team, 2 reasons for that, and we'll look at growth in prescriptions on the next slide, but that's to drive continued growth in major depressive disorder and then also our new indication, Alzheimer's disease agitation, which was approved earlier this year. We launched it in the summer. The launch really got up and running in June. The field force expansion really completed in June for the community team. And we also added a new team, a smaller portion of sales team members that are fully dedicated on long-term care, which we were not engaging with prior to the approval of Alzheimer's disease agitation.

From an efficacy perspective, highly distinct, again, that ties to the mechanistic differentiation. And so it is has a very important efficacy and tolerability balance and adverse reaction profile that is distinct from other products that are used on or off label. So we're incredibly excited about the ability for Auvelity to meet a very substantial need in the market and treatment landscape. And when we look at rates of adoption and adoption since launch, just very robust growth. We expect that growth to further continue.

And in fact, to -- we do expect inflection as a result of Nick touched on access, the state of affairs and positive developments and evolution of access, the field force expansion and then the new indication. So we expect a lot of growth. And what we've shared is we expect to see that growth begin essentially now, so 1 to 2 quarters following the completion of the expansion and the launch in Alzheimer's disease agitation. We're starting to see that in new prescribers, new unique prescribers. We're starting to see that in new-to-brand scripts in MDD, especially tying to the second quarter. And now we're seeing it in the 65-plus age group, which really corresponds closely and is a good proxy for prescribing in Alzheimer's disease agitation. We expect to see those trends continue.

Sunosi, this is our product for excessive daytime sleepiness and narcolepsy and OSA, very differentiated from what's available. And what we'll just share is feedback from prescribers and some data that we have. We mentioned improvements in cognitive functioning. We have the SHARP trial data demonstrating said improvements and the feedback from prescribers is such that overall global changes that patients experience are very compelling and distinct. And that's led us to that multifaceted clinical program for solriamfetol, which we'll cover. And as we touched on, the product has been growing since we acquired the product. It's been growing very steadily. The business is very healthy, and we expect that to continue. And then we're incredibly excited about additional potential label expansion possibilities.

SYMBRAVO, that's our product candidate for the acute treatment of migraine, highly differentiated. We undertook that from a rational development perspective, many products approved, high, high rates of dissatisfaction with patients and prescribers from an efficacy perspective. And that's what we demonstrated in the clinical setting that the product works very, very well. It works quickly in terms of aborting a specific attack, but then it has a very -- a long half-life where we see very durable efficacy. and tolerability profile that is compelling for said efficacy.

Product's growing, and in particular, we'd like to call attention to the growth in volume. We are navigating, Nick touched on this, the very regimented and dense access barriers and hurdles and friction that there's nothing new here for this market, but migraine is a heavily managed market from a payer side. So we're navigating that. And most importantly, this stage of launch, we're about a year in. We really like the demand growth that we're seeing and the feedback that we're seeing of that product profile is very compelling.

We're seeing -- as I mentioned, we saw 30% sequential growth, and that was with a team of roughly 100 reps. Based on this demand, we decided to increase that team by another 50 reps to 150, and that's -- that additional 50 reps is not shown -- their effect is not shown in this graph.

And then -- so those are the 3 commercial products, and we're very excited for the rest of this year and 2027 for continued substantial growth across the programs. And then if we quickly turn our attention to the pipeline, and we'll have to be efficient here. Here's the snapshot of all the programs. I touched on these earlier, but the current state of affairs, so one NDA under review. And I think the way if we zoom out, what we'd like to share is that we potentially have one NDA filing per year for the foreseeable future into 2031. So we expect that to -- the pipeline gears to turn. We've had a very, very effective clinical trial at conducting clinical trials. We expect that to continue. We've done a good job navigating regulatory processes and reviews, and we'll keep at that.

If you look at psychiatry and neurology, the potential impact to patients in the U.S. is significant. And as mentioned, we're looking at 10 areas of need. And that can either be no 0 to, say, 1 approved product or indications with multiple approved products with some type of treatment gap as the area of unmet need.

Here, you can just see the total breakout of the $18 billion plus in annual peak sales potential. This doesn't include the most recent assets that we brought into our BD team for AXS-17 in epilepsy and AXS-20 in schizophrenia and Tourette's syndrome. But really, the main focus right now is in the near term is Auvelity with the MDD further expansion and growth there along with the ADA indication and then SYMBRAVO and Sunosi being our other 2 commercial assets.

The intellectual property position of the company, the approved products and those in development is very strong. And we would just like to highlight for Auvelity, the -- we have completed and have determined the exclusivity period, which runs into the end of 2038 or early 2039, and we expect it to be early 2039 upon receipt of pediatric exclusivity. Sunosi, that has now -- that runway has also now been established, and that goes into 2040. And so both of those programs have defined and established life cycles that are incredibly long, and that ties to our expectations with being able to impact medical practice as distinct treatment options versus available therapy and therapy in development. So we're incredibly excited for both of those programs.

And then SYMBRAVO, the work to establish the period of potential exclusivity is underway. So we'll have updates there, but the patents go out to at least 2045. AXS-12 orphan indication for narcolepsy and then there is a patent portfolio behind that and same for AXS-14 with a robust patent portfolio. So that's always been a focus for us. That will continue to be a focus. And the commercial business right now is -- has a fantastic longevity, which we're excited -- very excited about.

And finally, we would just like to touch on the innovation that's occurring at Axsome, and that's in the commercial portfolio, distinction of the products for their respective approved indications and then the other programs that are underway. So we're very excited about the state of affairs for the business. It's never been better. And we're right on the precipice of our next phase of what we expect to be incredibly robust growth, especially with respect to the prior growth to date.

So we look forward to keeping you all posted, and thanks for having us today.

Good afternoon, everyone. I'm Sean Laaman, Head of U.S. Mid-cap Biotech Equity Research here at Morgan Stanley. Welcome to our Global Healthcare Conference. For important disclosures before we commence, please see the Morgan Stanley research disclosure website at www.morganstanley.com/researchdisclosures. And if you have any questions, please reach out to your Morgan Stanley sales representative. For this session, we have Axsome Therapeutics with CFO, Nick Pizzie; and COO, Mark Jacobson. Welcome to both of you.

Thanks, Sean. Great to be here.

Yes. If you can do me a favor, I've got 3 sort of macro high-level questions to start. First one is, how is the rise of China originated innovation, if at all, changing the competitive positioning and your R&D and BD playbook?

Sure. The -- so for us, state of affairs is mostly status quo on the R&D side. We are seeing more products and earlier-stage products that are being identified, discovered and developed in China that are making their way over to the U.S. either in terms of potential business development efforts. So we are seeing that. And then maybe another element of R&D is just increased number of third-party vendors or nonclinical, preclinical laboratories and beyond that are becoming viable options for R&D efforts. So we're seeing -- I would say we're seeing those 2 elements the most. And maybe one other item is solriamfetol is, of course, available, and I'm not sure if that's what you're alluding to outside the U.S. So there's that potential impact. But again, for us, things are status quo.

Sure. And are you implementing AI across the business? And if so, where are you seeing it have the most effect?

Sure. We are, and it is across the business. And I think as you know and probably behind the question is there are all kinds of ways to implement and deploy AI, and we do that already and on the commercial side of the business. So for data and analytics, how we're modeling, how we're applying those models to sales operations and tactics. And then there's actually tools that we have implemented for the sales team members, so determining next best action or call plans. There are AI engines that we've incorporated into that process. So we -- what does that mean that's there as a tool to drive efficiency and productivity for sales representatives. It's also being deployed in other elements of the business, and we haven't talked a lot about it.

And -- but there are all kinds of ways where you can use this powerful computing tool to monitor CMC activities or drafting large documents and templating those and having them driving speed to, say, early drafts or QC large bodies of data that have -- that you could expedite that process. So it's showing up in all kinds of ways. There are individual efforts or individuals driving this. There are teams of folks thinking about how to drive innovation at the organization. So it's percolating through the organization, but not anything that we've necessarily disclosed AI innovation plans around. It's all just part of the company's kind of normal state of affairs in doing business.

I'd say probably the one thing it won't necessarily substitute that face-to-face interaction with the HCP. There's -- that's something that the doctors truly value is understanding the product directly from an [indiscernible] [ Axsome ] representative. And we could just see how AI potentially can support the reps to be even much more efficient and effective.

Sure. Last question before in Axsome specifically, but which policy variable FDA Medicare negotiations, MFN, tariffs or global pricing matters most to your economics? And what have you changed in anything, if anything, because of it?

Yes, sure. Maybe I can answer that question. Probably the biggest factor there would be the IRA negotiations that if and when they do come about, would impact us starting in 2032, and teams are already preparing for that and doing the HEOR analysis and publications and so forth to prepare in the event that we do have negotiations. And we've already additionally, we've already priced into our peak sales model of $8 billion. We would say, a relatively conservative approach or a conservative estimate compared to what some of the outcomes that we've seen thus far.

Maybe just to add to that, you add in that list just FDA dynamics. And for us, there that's I'm trying to find another phrase beside status quo but it's generally status quo for us that, look, we have the 3 approved products, Auvelity. It was recently approved for Alzheimer's disease -- Alzheimer's disease agitation, excuse me. And so that's launching, and I'm sure we'll talk about that. The other programs that are in development, we've received FDA feedback on commensurate with those stages of development for any given program. So we feel very good about our dialogue with FDA and what we need to do for -- to submit additional marketing applications.

We have another one under review right now, by the way, that's AXS-12 for narcolepsy, cataplexy in narcolepsy. We have a PDUFA date there of May 1. So again, status quo on the FDA side, even though we know there are -- earlier this year and prior, there was a lot of -- there were a lot of changes. And then there are new guidances that are coming out. But again, we're -- we feel good for that part of the business.

Awesome. Thank you. I've got a series of questions here now on Auvelity and the ADA launch. But really strong growth in Q2, high teens, 18%, I think it was. But a lot of debate in the market, sort of how much contribution from ADA versus benefit or penetration in MDD from the expanded sales force? How do you balance those 2?

Yes. So for Q2, it feels like it's a distance -- it's been a while now in Q2, but the vast majority of the scripts in Q2 were related to MDD, specifically around the expansion. And I think what we're seeing in Q3 is that a significant piece of the NBRxs, we're starting to see the impact of the additional indication in our NBRxs and -- most recently this past Friday, we hit a new all-time high of 3,800 NBRxs per week.

So that number is continuing to be -- continuing to grow quarter-over-quarter. We were at 2,400 in Q1 on average on a weekly basis, 3,000 in Q2. And now tracking the last 3 weeks have been 3 consecutive weeks of the highest NBRx that we've had for Axsome for Auvelity. So pleased with that growth, and we are seeing that specifically the percent within the 65-plus Medicare sector cohort, the 4 weeks prior to the approval, they accounted for roughly 19% of our NBRxs. Now we're closer to 31% of our NBRxs. So said another way, what appears to be is the agitation indication is the fastest-growing segment within the NBRxs.

Sure. A lot of debate in the market that even though you reported those strong numbers and it continues to go on, just looking at reported scripts, people are using those as a basis to say growth isn't necessarily what we expected it to be. So there seems to be some difference between what you're reporting and what you're observing versus the script numbers. And maybe just perhaps remind investors why it could be an erroneous thing to just rely on script data for Auvelity's performance.

Sure. The -- I think maybe it's the -- how you think about bridging near-term and immediate impact changes to scripts. -- and the overall opportunity for both MDD and AD agitation. So those opportunities are very large. We can talk about them. And of course, we've guided to our peak sales estimates within each category, and we think they are significant simply due to our very modest penetration estimates.

And we can talk about how we get there, why we think they're modest and conservative. But there may have been some folks who -- to your point or what you're sharing is there are some folks were expecting an immediate kind of vacuum filling effect, which was not our expectation nor our guidance. Instead, what we shared is that we expect growth to start to show up both from the field force expansion and the new label indication for Alzheimer's disease agitation in 1 to 2 quarters as the start of growth.

And so we're -- that's why Nick was talking about NBRx, so the pure new-to-brand scripts. So that's really where we're starting to see continued growth in prescribing in major depressive disorder and now starting to see our initial prescribing in Alzheimer's disease agitation. So the growth is there, as Nick was touching on the last few weeks, the growth is ticking up and ticking up and ticking up, and we expect to see that continue and then start to really impact total scripts. So that's all moving along and in line with expectations.

We can talk about other metrics in terms of new prescribers and number of new unique prescribers that's increasing substantially, and we expect to see that translate also into total scripts over time. And so it's moving along, and we're watching the impact, and we expect it to continue to grow. But we're pleased. What we'll share qualitatively that we're very pleased with is the feedback we've received from prescribers who have tried the product in Alzheimer's disease agitation that it's working well. The tolerability profile looks good. So that's really good to see because then, of course, that gives us a sense of the product is performing in a real-world setting, similarly to what we saw in a clinical setting and then that ties to how we're thinking about total opportunity or total utilization through peak.

Yes. And maybe just 20 seconds on the TRxs. So we've been talking about NBRxs and really seeing that nice lift in where the Ts. But if you actually -- even with the most recent data that we had on Friday, this last 3-week period was one of the strongest 3-week periods, consecutive 3-week periods that we've had the entire year. And that's at the -- taking into consideration probably the most seasonally worse or negative part of the year being mid- to end of August, early -- mid- to end of August and early September, where typically you have a downtick in TRxs or a flattening in TRxs, we've actually seen tremendous growth. And like I said, it was one of our top 3-week periods of the full year.

Sure, sure. And beyond that, I guess, sort of top line or reporting top line quarter-to-quarter, just to give investors a bit more on how the launch in ADA is going, going forward. Do you plan to either split out scripts, give that percentage of scripts going to 65 and older? Do you plan to deliver anything beyond the top line to give some investors confidence the ADA launch is indeed going observably well?

Yes, we're going to try to be more helpful. I know the Street is eager and thirsty for additional metrics. And this is going to be our first full quarter to be able to announce how the launch is going. So we're mindful of that. And I think we're looking into our team to be able to provide more metrics.

Fantastic. Just going back to the sample equation. So sample is roughly 3-week community trial packs that don't appear in the syndicated data. So converted scripts first fill around week 4. How much of the July script picture is June sampling? And then when does syndicated data become a reliable read?

The -- so we haven't shared conversion rates or time lines. So the 3-week sample titration pack for Alzheimer's disease agitation, of course, that's according to the labeled instructions and clinicians are -- the team is giving out samples and it's a robust sampling program. So the sales reps are able to sample. They have -- there's an allocation and then prescribers are able to request or receive a certain number of samples on a weekly or monthly basis. And that's all moving along in line with expectations.

The conversion rate, we're monitoring, and that changes pretty dramatically in early days. And so I think you touched on how it's labeled for utilization. What we can see is there are different types of prescribing that -- or feedback anecdotes that if someone is being switched, they may go slower or perhaps they're also given a maintenance dose sample. So all of that -- it's not to say there's anything out of the ordinary or unusual happening, and it's very much in line with expectations, but that makes for a fluctuating conversion rate. So we haven't shared that. We've never commented on sampling from launch, specific numbers.

And most sponsors don't because, of course, that ties to sales operations strategy and tactics, and there's a lot of competitive intelligence around that. But right now, what we're seeing looks good. So -- and the distillation of all that is we are starting to see conversion of sampling to scripts. And of course, we can see that in the new-to-brand script numbers Nick talked about. We can see that in new prescribers and then that flows into total scripts. So we'll continue to sample. We continue to sample in MDD, and we'll monitor that, but that's probably not an area where we'll have a lot of commentary.

And your final question is when does it kind of get into steady state or how much time? I think that's probably when we report again for the first full quarter of launch in the indication when we report Q3 and maybe beyond, I think that will be helpful. We know there's a lot of interest in sampling right now, and that's probably just a window into what's the best way to model what's coming and how quickly and how big it might convert or inflect for scripts. So we know there's a lot of interest there. Again, it's moving according to expectations. We're happy with that. And I think Q3 will help folks, and then we'll see additional -- what Nick alluded to what commentary we can provide in addition to what we have, and we'll look to be helpful.

Sure, sure. You mentioned that you're perhaps conservative on the Auvelity outlook, and you've got an $8 billion long-term run rate or guide out there. Maybe just talk a little bit about, if you can, sort of what penetration price assumptions sort of go into that metric and what -- why you think it might be conservative and what you're observing today that underpins that view.

So for -- specifically for ADA or are you speaking for Auvelity?

Overall, I believe.

Yes. So maybe I'll start with MDD, and I've shared this previously, and the numbers continue to grow, but we're just at 26 bps of the total antidepressant market. And this was as of the end of Q2, we were tracking towards roughly $0.75 billion. So if you get to 1% of the total market, you're already north of $3 billion, and that's a market -- the branded market is also continuing to grow. So that kind of gives you a sense of how we're thinking about it and how we get to the peak sales. It doesn't require a huge piece of the market to be able to get to that $4 billion.

And then ADA alone, we mentioned there's north of 20 million scripts. Again, that number continues to grow. I think the prevalence of Alzheimer's is expected to double by 2050. So that 20 million scripts as well is with just that one -- previous to us getting out there, one other branded agent that was an atypical.. So roughly 99% of the market was generic and being written off-label. So we feel that being able to achieve a decent-sized market share of the ADA market is very attainable.

And just to touch on persistence and other assumptions that go into that modeling. We -- for MDD, we now have about 4 years of data for persistence. And so that goes into the MDD model. And for AD agitation, we tend to actually dial that persistence number back based on how products Auvelity aside, persistence rates for products in Alzheimer's disease agitation, which are lower. So we use those lower numbers. However, clinically and what we saw is very, very durable to a year and beyond responses and reductions in agitation symptoms and very tolerable incredibly low discontinuation rates.

And so if what we see in the real world matches clinical settings, then that's an area for potentially significant upside in the model. But as always, we like to take the -- we like to go with kind of the low tide or low watermark estimates, and that's what we started with -- how are you going to add?

Yes, I was just going to add all this -- the numbers that I shared earlier with like 0.25%, 0.26% market share, that doesn't even take into consideration the expansion that we have done, right? That's pretty much where we were prior to the expansion or the implementation of the expansion. So as a reminder to everyone, we've doubled -- more than doubled the size of the team. We have LTC team out there now, too, that's just getting started. And we also have the advantage of the market access that we've built, the payer access where we have 89% of total covered lives covered, Medicare, 100% total covered lives and also first line or first switch in the majority of them.

And one of the things that our team has done in expanding is not only we are able to have better depth within the high-decile doctors, but breadth specifically around primary care because that's really where the focus is. That was one of the main reasons why we decided to expand the team and more than double the team is to drive adoption in primary care where you see both MDD as well as ADA.

Sure. Moving on to the pipeline for a minute. So solriamfetol, multiple indications, Phase III ENGAGE study due to read out. How would you rank the commercial opportunity in those indications?

From an opportunity perspective for solriamfetol, I think size, you probably start with ADHD. It's a large market. There is a high -- there's a high demand and need for new treatment options. And right now, we have 2 trials underway there in -- it's in children and adolescents. And we need both of those studies to read out in order to if they are positive, that would enable us to file an NDA or sNDA. We have the adult study completed.

That was positive and very substantial treatment effect and a tolerability profile that's in line with the established safety and tolerability profile for their approved indication. So that would be next or I'd say, first and then I think it could depend on the data, but you think about major depressive disorder with symptoms of excessive sleepiness. We have 1 proof-of-concept study in depression that's been completed.

We're conducting another. So we'll see what it shows. And that could be substantial as well for depression. And obviously, we're very comfortable with commercial operations and infrastructure in depression. ADHD, I didn't touch on that, but that's also very similar from a commercial operations and strategy and tactics perspective. Then you have binge eating disorder and shift work disorder. Binge eating disorder is exciting. We have a readout coming up in the fourth quarter. And that's an area of unmet need. It's a very -- it's the largest eating disorder and there's only one product approved for it.

So there is a need there. We'd expect to need 2 studies an additional study if the ENGAGE trial reads out positively and the shift work, which is probably from an opportunity perspective, the smallest but not insignificant. What's nice about that program, though, is we expect to only need 1 trial if it's positive to file an sNDA or NDA due to the relatedness of that condition to the currently approved indications.

Sure. Thanks, Nick. Still on the pipeline, AXS-12 PDUFA date May next year. What's the commercial opportunity alongside oxybate and the emerging orexin agonists?

So what we've shared is we think the opportunity there is $0.5 billion to $1 billion, and we're -- we like that from a product profile perspective. You mentioned other agents. So those are agents that are approved, have been approved for some time or new entrants or others in development. And we are really excited about AXS-12 because it's differentiated kind of regardless of your point of reference, there's differentiation. So you have daytime dosing, you have a very distinct adverse reaction or safety and tolerability profile, which is compelling the efficacy profile. We focused on cataplexy as the primary endpoint in the clinical program.

We also showed benefit in sleep in excessive daytime sleepiness and cognition. So we don't have a final label, so it's a little bit early to say exactly how we'll differentiate or patient profile, the most obvious patient profile. However, if you just look at the totality of data we have in hand, it would be a total -- and of course, where does that come from? It comes from mechanistic differentiation. So differentiated mechanistically. And so then that would be a distinct treatment option. And it is orphan. It is an orphan indication, but it's not ultra-orphan. And so there's plenty of room to -- for a meaningful distinct treatment option, which we're excited about.

And a reminder, the PDUFA date again is May 1, 2027. And we have the sleep expertise team already embedded into the company between the marketing, market access and the sales team. So this is essentially a plug and play where we can just add this to the bag if we choose to, of the sleep team and should be accretive very quickly.

Sure, sure. Last quarter, we saw quite a decent bump in SG&A. But looking forward, like how would you characterize that?

Sure. Yes. SG&A and R&D, we feel like we're at -- we'll essentially plateau in the back half of the year as compared to the Q2 numbers. SG&A in Q2 included pretty much the entire expansion. So it included most -- pretty much the entire expansion and part of the LTC team, but there were some additional expenses that we had in Q2 that we wouldn't expect to see for the rest of the year. So we feel like that where we landed $208 million is a reasonable number as we go into the back half of the year.

And then R&D, we would anticipate that number to continue to grow. We were at $46 million in Q2. We have 5 ongoing Phase III trials, if I'm counting correctly, currently. And we would anticipate that number to grow marginally. But importantly, the top line revenue should grow significantly faster than what we're seeing on the OpEx, which will show operating leverage in the P&L.

Sure. And I think you've got cash about $320 million, burning $25 million a quarter. You say you've got enough to get you through to cash flow positivity, which quarter is that?

I think it's a fair question or an unfair question. We haven't given any specific guidance on specifically which quarter we get to. But I think it's -- if you take a look at the back half of last year, if you back out noncash costs and onetime charges, we were -- for the last 6 months of the year, we were a total of around $10 million of a net loss on a cash basis. And I think this year, we're even in a better situation, I think, with the indication approval, with the expansion and costs already embedded in the Q2 numbers. I think you'll see operating leverage. And I think we're on a very, very clear path to cash flow positivity and shortly thereafter profitability.

Sure. Awesome.

Very, very exciting time to be able to talk about that.

Okay. Fantastic. Thanks, Mark. The Teva settlement pushes Auvelity generics back. So with that runway secured, does the strategy tilt towards margin or toward further pipeline investment?

The -- so we're -- with respect to Auvelity and the overall pipeline, the answer to that is yes. So we will -- we have a lot going on right now. And much of it is -- it's not as lopsided to the late stage as it was. But obviously, there's a ton that's late stage, either in NDA review, nearing NDA review or has just started Phase III development. And then we have earlier-stage programs now with AXS-17 in epilepsy, AXS-20 in schizophrenia and potentially Tourette syndrome. So for Auvelity and frankly, the 2 other on-market brands, we'll think about additional investment there for new potential label expansion efforts.

And that work is underway. We had touched on that for Auvelity that we've just started the trial in smoking cessation, the SUMMIT trial, Phase III trial, that was just started, but we're exploring other potential indications there. And we'll continue to do that for the rest of the pipeline as long as it makes sense from an investment and mechanistic perspective, we'll do that. And I think that really ties to Nick's immediately prior commentary about just how we're managing the business and how we're investing, but it's a great time for commercial execution and also the pipeline.

We're just on time, but I didn't ask, I should have...

I know, I think that was good. I think we covered commercial execution and growth and then what we're doing behind that to drive continued growth, and we'll keep everyone posted, but that was a pretty well-rounded discussion.

Thank you.

Thank you, Sean. Appreciate it. Thank you.

Thank you.

Welcome to the Cantor Global Healthcare Conference. I'm Pete Stavropoulos, a biotech analyst with Cantor. With us, we have Axsome, a company I cover. I am pleased to introduce Nick Pizzie and Mark Jacobson of Axsome. So let's start off with a brief intro of yourselves, snapshot of Axsome and the company's focus and strategy.

Thanks for having us, Pete. Mark Jacobson.

Nick Pizzie, CFO.

Axsome, CNS-focused biopharma, we have 3 commercial products, which we'll, of course, focus on the flagship at the moment and all eyes are on Auvelity, which is approved for major depressive disorder and recently, Alzheimer's disease agitation, which we are launching.

We've done expansion around that. And right now, it's all commercial performance for that product and then 2 others SYMBRAVO for migraine and Sunosi for excessive daytime sleepiness in obstructive sleep apnea and narcolepsy. Behind those products, we have a very deep and broad balanced pipeline of programs that are NDA stage, that's AXS-12 for narcolepsy.

We have a PDUFA date of May 1 there and multiple Phase III programs either with one positive Phase III trial or that we've just initiated and are looking through various readouts, we can touch on those. So it's an incredible time for the company. The company is better positioned and the fundamentals are better than they ever have been. And right now, it's all about execution on the commercial and pipeline side of the house.

All right. So in terms of catalysts that are coming up on late-stage assets, what should we expect in the remainder of '26 and '27?

Remainder of '26 from a pipeline perspective, we've recently initiated a number of Phase III trials. We'll get into those. But looking towards -- between now and the end of the year, we have the ENGAGE Phase III trial of solriamfetol, that's Sunosi. In binge eating disorder, we've guided to top line results in the fourth quarter. So we're looking forward to that.

We like that program and the 3 other label expansion efforts or potential label expansion efforts that are ongoing now. Those are real quick major depressive disorder with symptoms of excessive daytime sleepiness, shift work disorder and ADHD.

So that's the next pipeline event. And then looking to next year, I've touched on the NDA, the PDUFA date for AXS-12 in narcolepsy. Again, that's May 1. And then we also have guided to top line from the shift work trial of solriamfetol in 2027.

All right. So you're also laying the foundation for the next wave. You have ongoing Phase II/IIIs as well as what you plan to initiate. So just walk us through those.

Sure. So maybe I'll touch on the recent initiations, which I alluded to. We have AXS-05 in smoking cessation. We just initiated the SUMMIT Phase III trial, that is AXS-05 versus placebo and versus buproprion. So again, that we just started. We haven't guided to top line yet and enrollment is underway. So stay tuned for updates there.

Just prior to that initiation, we initiated 2 trials with solriamfetol and ADHD. So we have a positive Phase III trial in adults with solriamfetol and ADHD with substantial, and we saw a substantial improvement in adults and symptoms of ADHD. And so now we need a study to complete studies in children and adolescents. Those are ongoing.

We'll provide updates there and top line guidance once enrollment is really underway, and we have a sense of how that's tracking. The other trials that are underway, we have -- again, I touched on the shift work disorder trial, and then there's the trial in major depressive disorder with solriamfetol. We haven't guided there yet either. And that's -- but that study enrollment has now been underway for a number of months.

Looking at AXS-14, that is reboxetine, so the enantiomer of reboxetine in fibromyalgia. That trial we initiated a number of months ago now and is enrolling there, too. So we'll have updates for all of these programs. We're really excited about them.

And then if you look even earlier in the pipeline, there's AXS-17 and AXS-20, both of which are programs that are relatively new to the pipeline, which we added last year and early this year and tech transfer activities are underway. Those are programs that were AXS-17, we're looking at for epilepsy and AXS-20, we plan to start a Phase III trial in schizophrenia as the next program there. And we're also interested in exploring that for Tourette's syndrome.

So just a lot going on, different therapeutic categories, all highly complementary and kind of leveraged the clinical expertise that we've built over the years, and we'll look forward to keeping you posted on that.

I'm surprised you can keep all of that in.

Yes. No, it's -- I'm sure I forgot something.

All right. So turning to Auvelity. You recently increased your peak sales potential in MDD in combo with Alzheimer's to greater than $8 billion. So what are the assumptions behind that greater than $8 billion opportunity?

Sure. Yes, I can talk a little bit about MDD to start with. So we ended the quarter Q2 at $180 million, so annualizing $720 million. And that's only -- that was with less than 0.25% of the total market share. So we recently expanded the team from 300 to 600. We also now have an LTC team that will be detailing or -- is detailing on MDD as well as ADA.

So we feel that the -- if you take a look at the $8 billion and you split that up roughly 50-50, $4 billion, that's only 1%, a little bit north of 1% of the entire antidepressant market. And what we've been able to achieve thus far with roughly a significantly smaller sales force than a lot of our peers. That's why we decide, hey, let's double the team and let's take advantage of it.

We have exclusivity through Q1 2039 with -- if we get the pediatric indication for Auvelity. So there is a long runway, an additional 12 years that we have the ability to get to the $4 billion for MDD. And then when you take a look at ADA, obviously, it's untapped market with just one other branded agent in there, that's an atypical antipsychotic. And we are -- we have just launched that. We're really pleased with some of the performance that we've seen thus far.

But there's north of 20 million scripts that are written each year in this indication. And so we feel that the market is for our taking, and we are -- like I said, we just launched in the community setting, and we are launching in the long-term care setting.

All right. So with the recent approval and launch, like you said, it's a very large opportunity, meaning ADA. So you're still early in launch, but what are you sort of seeing and learning from the first several months of launch?

The first thing we always look for with the launch is feedback from prescribers who have tried the product. And so we're starting to get back -- that feedback is starting to come in for prescribers that -- early prescribers for AD agitation. Of course, we've been getting that feedback now for major depressive disorder for some time.

And we're seeing a very consistent theme and category of feedback, which is that patients who are starting on the product are seeing important reductions in agitation. It's occurring quickly and the tolerability profile is very, very good.

And feedback we're getting from clinicians who are interested in the product or haven't yet or who have that a key consideration and differentiator is the tolerability profile is very much of interest because it's an at-risk patient population.

And so tolerability profile or the types and rates of AEs that we saw, very moderate in nature. And of course, then the product does not have a black box warning for mortality risk in individuals with dementia. So that's driving interest in terms of the feedback we're getting. And so that's great.

And then the early trial so far is lining up with the data we saw in the clinical program, and that's great. So that's leading to additional interest in trial. And then that filters into the sales team strategy and tactics for who we're looking to engage with in terms of from education to provide samples to.

And so all of that work, all those gears are turning, and we like what we're seeing so far, and we'll keep it going. And we expect to see impact from all that work start to grow and build materially between now and the end of the year and beyond.

All right. So there is off-label use of generic antipsychotics in this indication. What do you see as like the biggest barrier to shifting prescriber behavior to drive adoption of a branded therapeutic?

Well, I think part of it is just education, right? The utilization of off-label products or products off-label for the indication is due to the historical lack of approved treatments. So now there are 2 approved treatments and both very different. So that's great because there are different patient profiles and different needs.

So I think it's very basic and again, corresponds to our efforts, which is education and of mechanistic education, scales and diagnosis and patient profile. So that's the team job. That's the sales team members, that's their job, the medical affairs team members, that's their job. And of course, they're able to engage and educate in different ways and be available to prescribers to answer questions.

So I think that's the bulk of it is just that it's not that those products that were used off label were necessarily incredibly effective or -- but rather the need, the clinical need is so large and the impact of agitation is so substantial, eventually it would get to the point that intervention would be required to prevent those individuals from risk and harm to themselves and others.

And so now that there are multiple approved products and Auvelity in particular, we're very excited about its profile. We think that will lead to changes in prescribing patterns, and we're starting to see that now.

So you did highlight that 126% increase in NBRx among patients 65 and older. How should we interpret that from your perspective? Like how do you interpret that? I know I'm...

Yes, I think that's the first leading indicator is the NBRxs. Another metric we've been sharing recently is that prior to the approval, the NBRxs related to the 65-plus Medicare LTC, they accounted for 19% of our NBRxs. So the month prior to a launch, basically, that cohort accounted for roughly 19% of our NBRxs.

Most recently, now that's north of 30%. So we're seeing that growth in NBRxs, which will ultimately transform to TRxs. The way that we think about the growth and the demand for ADA is it's the NBRxs that you're seeing in the titration packs that get reported and everybody is looking for it every Friday to seeing what those numbers are, but it's also the samples that we're providing to the doctors.

And that -- the amount of samples that we are providing to the doctors is significantly higher than what you're seeing out there reported through scripts. Those samples ultimately, like as I shared, will convert to a T in some fashion. So we're starting to see the inflection in T's the last couple of weeks in Symphony and IQVIA data.

And this is also in a time that's kind of more of a bar and time for -- in the psych space that mid- to end of August is usually a quiet period, but we're seeing that growth through this more difficult time period. So as September, October comes around, we should be able to start seeing the conversion of those NBRxs to TRxs.

And the reason why we're doing sampling is we're heavily sampling and we continue to sample in MDD as well, right? Doctors always want to try new patients on samples first, especially this cohort or patient population that's 65 and older, that's a little bit more fragile.

They want to be able to sample, try it, see how well it works, and then they will be able to either, a, write the script for another titration pack perhaps if they see fit or they can write a script for the maintenance dose. So that either one of those will come out as an NBRx.

And so the bottom line is probably underestimating because of the sampling.

Again, we're defining demand as what we see demand and interest in the product is between what the patient is getting through a script or what the patient is getting through a sample. And that sample is just a temporary process that will eventually convert into a script.

Okay. How should we think about adoption in the community setting versus LTC, both in the short term and in the long term?

So the snapshot of the market now, right, agnostic to any product is about 60% of the scripts come from the community setting and about 40% from long-term care facilities or long-term care channel. For us, specifically, what we would see in the short term or right now is that we'd expect the majority of the scripts to continue coming from the community setting. And that's just because that setting is further ahead, right, from an infrastructure perspective.

So -- and the time from a potential, say, detail or call or educational effort to a potential script or a sample and then to a script, that's shorter than, say, the activation that happens in long-term care.

So as a reminder, our commercial team and infrastructure, there was no long-term care component previously. So we were not engaging with long-term care facilities prior to the approval. So that's underway now.

But that environment or that channel is much different from a community setting where there's -- there are prescribers and an account manager or a sales representative may go in, engage with a doctor and then that doctor, if they end up being interested in trying the product and they have an appropriate patient that comes in or a relevant patient profile, then they can write it.

And that's kind of all there is to it. In long-term care, there are multiple stakeholders in the process before someone in a facility may have a prescription and then the product is administered to them.

And so there's potentially a pharmacy network or a central pharmacy and there are stakeholders in decision-making and a gating process there. You have directors of nursing who are involved in overall prescribing decisions. And then, of course, clinicians or HCPs who either may be affiliated with a facility or a network of facilities or, say, a community-based clinician who essentially does like a rotation into these facilities.

And so it is -- the jargon is that these facilities are activated or brought online. That takes usually at least a month before you would -- before there's a general ability to -- for a prescriber or a clinician to prescribe or write in that setting.

So and simply in virtue of the fact that we weren't doing that previously, there is that lead time. But then once that occurs for any given facility, we'd start to expect to see writing there.

And then that will lead to kind of a differential mix between scripts coming from community and LTC versus what you see for the current kind of background rates, but we'd expect that to grow and change over time.

All right. Anything else to touch on, on the Alzheimer's launch?

Just that we're really excited about it, and we're really looking forward to keeping folks updated. But as you alluded to, we know everyone is really interested in weekly Friday numbers, and we expect those to continue to, again, grow between now and the end of the year and beyond.

So it's great to have the product and the feedback that we're getting now and see it as a -- its potential utilization grow over time.

All right. So MDD, growth continues to build. Main drivers of that, primary care uptake, increased prescriber confidence. Anything you can tell us?

The MDD, that's -- I don't want to use the word status quo because that maybe suggests lack of activity. But MDD, we're still seeing very high demand and interest and uptake. And you're right. So from launch, the focus was to start in engagements and focused activity in higher prescribing psychiatrists and then we've broadened out from there.

And what we see is once there's trial in a certain number of trial for any given prescriber, the feedback similar to AD agitation has been very robust that the product works well. It works rapidly. It's durable and then it has a distinct safety and tolerability profile, which is leading to very, very positive feedback on the product and how it performs.

And so then that's driving uptake. So Nick touched on where we expect to be from, say, at steady state from penetration. So there's -- we're at about...

Right now with NBRxs, we're at 42 basis points, so 0.42 of 1%, which is a leading indicator of where we would expect the TRxs, which is just under -- or just right around 25% of 1%, so 0.26%. So that will give a good indicator. The NBRx market share of 0.42 gives us a good indicator.

And that 0.42 is really just getting underway with the expansion, right? So that's -- we're expecting that number to grow and grow pretty significantly. And one of the reasons why we wanted to do the expansion was to get -- to have better depth with the high-decile doctors. With 300 reps, it was hard to be able to get in front of those high-decile doctors as frequently as they need to be.

The more that you're able to detail and share the benefits of Auvelity, the more likely that doctor will think about what patient is the right fit for Auvelity. And then it's also just that we're actually reaching more docs, more primary care where we really think that that's how we're going to be able to grow the business.

Do you want to touch on access quickly too?

Sure. Yes. Access, we -- the great thing about access is it's improved and it's evolved over the last even 12 months. So right now, there's 89% total lives covered for Auvelity, of which 100% specifically in the government channel, which is obviously important for ADA, 82% in the commercial channel, and we're at 50 -- north of 55%, 56% that is for first switch -- or I'm sorry, first line or first switch.

So access covered lives is at a really nice level right now with great formulary access. And just going back to ADA, if we think about that 100% total covered lives, the majority of them north of 85%, have no PA and are either also first line or first switch.

So if a doctor does find a patient, it's very likely that patient would be covered and would be able to get the product.

And going back to your question about just growth in MDD and continued growth in MDD, so there's the sales force expansion. Nick touched on how that allows us to increase depth and breadth with potential prescribers, but then access is at a point that as we go further into primary care, that tends to be earlier line utilization, so first, second line utilization.

The access is now at a point where if it's written in that setting, it can generally be filled. And so that lines up nicely. And the same point Nick just made for AD agitation. If it's written generally, there are very few barriers to it being written and then filled.

Yes. The setup is perfect for the back half of the year, right? We did the expansion. The teams now got, on average, 4 to 6 months, probably about 4 to 5 months of tenure now at Axsome. The market access is there. We're doing direct-to-consumer advertising.

We might tick that up a little bit towards the end of the year just to kind of get the pull-through. So the setup is there between the ADA and the MDD expansion launch.

I'm sure we can spend another hour talking about... But let's just turn to AXS-12 in narcolepsy. So moving into -- you have a PDUFA date on May 1. You've highlighted AXS-12's rapid onset, cataplexy reduction, cognitive benefit.

How do you sort of see this fitting into the current NT1 treatment landscape, where polypharmacy is common, but also on the backdrop of the orexin 2 receptor agonist entering the treatment landscape?

Sure. So of course, let's get the product approved first and that potential milestone is coming up. So that's in the first half of next year. And so without the benefit of an approval and a final label to let you know exactly how we expect it to fit, you alluded to the product profile, right?

We have -- we focus on cataplexy as the primary endpoint in our clinical program, but we also look at excessive daytime sleepiness, which we saw benefit and improvement and cognition also saw cognitive benefit. And then you touched on rapid onset of action. We have daytime dosing.

We have likely a very different scheduling from the what the primary products or products that have been utilized for this indication. And then the tolerability profile is distinct from what's available and products that are -- have recent approvals or other products that could be approved.

So kind of depending on, again, your point of reference, the product is differentiated, which is greater than what we're looking to do. And we think that all stems from the mechanism is differentiated. It's mechanistically, it's differentiated from what's available and other programs in development. And that's important.

It is an orphan indication, but as far as orphan goes, it's not ultra-orphan, and there's a pretty dramatic need for new treatment options. Of course, there's a lot of work now by the industry, which is fantastic. So we're excited about the profile again as something that's differentiated that can be a potential -- we'll see if it's approved, but a potential treatment option for -- to fit in kind of that you alluded to the -- you mentioned NT1, so that would be the area of focus.

And I would just maybe add that's super synergistic. We have obviously, the sleep expertise now in-house with Sunosi. We've been detailing that and marketing that since 2022. So the team can essentially, if we wanted to add that directly to the bag. So minimal additional operating expenses would be required and everything would just incrementally fall to the bottom line. So from a financial perspective, it makes a lot of sense.

All right. AXS-20. So in April, you announced that you acquired this PD -- phosphodiesterase 10A inhibitor from Takeda. What exactly attracted you to it?

Sure. Well, there are a number of things. We tend to -- I think it probably comes across in how we always go back to mechanistic differentiation. So to us, that's really important and how do you offer innovation to patients and prescribers. And to us, that always starts with the mechanism. So here, we have a potential novel mechanism for schizophrenia.

We also mentioned that we're interested in exploring potential applicability in Tourette syndrome. And there are -- there's -- so you have mechanistic rationale and you have clinical rationale. There is a Phase II trial in this indication that was completed that we see a signal that warrants additional investment and experimentation.

So the plan here is to conduct a Phase III trial in schizophrenia as the next clinical work for that molecule. You mentioned we acquired that earlier this year. So right now, it's about tech transfer and Phase III enabling work. And that work is underway. We're really excited about it in terms of just the overall need for that space.

There are some products approved, of course. But there is still a need for novel programs. And so we'll continue the clinical program to see if there is a signal and it may be efficacious and what the tolerability profile may be. But that is highly complementary to the products that we have in our commercial portfolio and those that are in development.

So it also is complementary in terms of if we ran through the pipeline, which I appreciate because oftentimes we don't have time to do that. It really helps us balance the pipeline, which historically was very, very late stage and lopsided towards Phase III.

So now we actually have things that stack in that are earlier stage. Of course, this is Phase III enabling work. So it's not that early, but it fits nicely with the other programs that we have in the pipeline.

So in terms of tolerability and AE profile, so from the Phase II so one of the problems with drugs in schizophrenia, right, is tolerability, and then they cycle off. And so is there anything that suggests that?

Well, yes. I mean, if you look at the rates of AEs and maybe classic AEs that are considered that you often see in terms of movement disorders as one example, there may be differentiation there. We have a limited data set so far. I mean, it's not that limited. There are quite a few patients in the Phase III.

Yes. So I don't mean to diminish it too much, but there's still more work to do to see if -- how much differentiation there may be there. But you're right, that's another compelling component. And again, we would tie that to most likely due to the different mechanism that the product has.

All right. We are out of time. I want to thank you both for participating in the Cantor Healthcare Conference. And they're looking forward for more progress.

Yes. We'll definitely do that, and thanks for having us, Pete. Really appreciate it. Thank you.

Okay. We'll go ahead and get started with the next one. I'm Ben Burnett, biotech analyst at Wells Fargo. Pleased to be here with the Axsome management team. We have Nick Pizzie, CFO. And then to his right, we have Mark Jacobson, COO. Thank you all.

Thanks for having us.

Great to be here.

I think just to kick it off, maybe we could just start by -- if you just give us kind of a quick overview of Axsome and just kind of frame any near-term catalysts that we should focus on.

Sure. I'd be happy to. And maybe I'll start and then hand it over to Nick. But Axsome, CNS-focused biopharma, we have 3 products that are commercial products. Those are AUVELITY for major depressive disorder and agitation associated with Alzheimer's disease. There's SYMBRAVO for migraine, and SUNOSI for excessive daytime sleepiness and obstructive sleep apnea and narcolepsy. All products are growing robustly. Nick can share some of those numbers. And of course, for AUVELITY, we have recently expanded that team. So we are seeing robust growth beginning in major depressive disorder, or I should say, continuing. And then the launch effort around the newest indication, Alzheimer's disease agitation, is underway. And so both of those efforts are -- have started to come online this summer. We can get into the details, but that's the commercial business.

So the company is -- the foundation and growth is better than it's ever been, and we're very excited about the opportunity moving forward for the on-market products. And behind those, we have a very late-stage and deep pipeline. And we can cover those. But very quickly, that covers a number of indications and states of development. We have AXS-12 for narcolepsy that is under NDA review with the FDA. We have a PDUFA date of May 1. And then multiple Phase III trials underway in indications for binge eating disorder, ADHD, smoking cessation. So a lot of additional ways to deliver value to patients with potential label expansion efforts for the products that are on market now and new entrants. So we're happy to cover those. But the pipeline is also more robust and late stage than it's ever been.

So the foundation is great, and we're really excited about where we are today, about 3/4 of the way through the year. And I'll turn it to Nick in case you want to review some of the financials.

Yes, sure. As Mark said, it's a unique and exciting time now at Axsome. It's really like the next chapter of Axsome's story. And I say that because we have the approval and the launch in ADA. And secondly, we've more than doubled the sales team for AUVELITY. So super exciting about the back half of the year. We're seeing already impacts from both the expansion, significant impacts on the expansion, which we can talk about a little bit more later on the NBRxs and also as it relates to the indication and taking a look at subpopulations and seeing that dynamic growth that we have. So we're really pleased with that.

And just from a financial perspective, balance sheet, we're in the best situation that we've been since -- really since inception of the company, right around $330 million as of the end of Q2, takes us to cash flow positivity, which we have shared in the past. That being said, we are also seeing in the P&L significant operating leverage in the back half of the year, where we really feel we're setting ourselves up in the first half of the year with the SG&A, with the expansion. The P&L has already been impacted on where we expect to be for the back half of the year. So really plateauing out from an OpEx and seeing a nice growth on the top line. So seeing the operating leverage and getting to -- eventually getting to profitability.

That's a fantastic overview. I want to start with AUVELITY in agitation. So it's obviously early days, and you've been on the market only for a few months. But what's been the early kind of doc feedback there?

The early feedback is -- obviously, it's very early, but we're very excited about the feedback we're getting, which is in line and matches the profile that we saw in the clinic and then the data that are on the label. So robust efficacy, it's working quickly, and the safety and tolerability profile is very compelling, especially in this patient population that is considered a frail or at higher risk patient population.

So that's great. It's still very early, and we want to -- the effort here and a key focus for us is driving trial and educating -- ensuring we're educating potential prescribers about the product profile and then ensuring that if they have a potentially appropriate patient that they are interested in trying the product in that they can do so. And that can vary depending on the setting, long-term care or community setting. We have a sampling program in place to facilitate that. The majority of patients are coming have Medicare or -- and so that's a different type of -- there's no co-pay assistance program in place for those patients. So there are other ways to support potential trial primarily through sampling efforts.

Yes. And then quantitatively, what we're seeing with the launch is prior to launch, LTC Medicare 65-plus was less than 20% of our total NBRxs. Most recently, we're now north of 30% of our NBRxs is that significant -- or sorry, specific subpopulation. So really seeing the growth there as it relates specifically for the indication.

Very cool. And actually, so I want to ask about the script data. And I think maybe this kind of feeds into sort of what you were just kind of mentioning there. I think a lot of us are -- there's a long history of script data because AUVELITY has been around for depression. And so we've kind of seen kind of that historical reference point. What are some of the considerations that we should have when we look at third-party script data?

The -- so with -- just in general, moving forward with respect to AD agitation, there are the -- folks tend to look at IQVIA and SYMPHONY scripts and both capture Alzheimer's disease agitation scripts. So we're not blocking scripts. Scripts are available. Sampling is not captured in scripts. So those are true samples. Sampling is not available for -- in the long-term care setting. And so one area to look at, and it is both for long-term care and the community setting is the titration pack.

So there are sample titration packs. Again, those do not show up in weekly scripts, but then there are also trade titration packs where someone can just start a patient with a script on the titration pack. We'd expect that to increase in both the community setting once trial is underway through samples, but also as a reflection of long-term care uptake. And so we're just starting long-term care uptake with respect to long-term care, the data providers project long-term care scripts differently. SYMPHONY, I believe, captures both new-to-brand scripts and total scripts or that it includes long-term care estimates in both of those segments, whereas I believe IQVIA, it's only capturing new-to-brand scripts -- or I'm sorry, long-term care scripts in the total scripts, not new-to-brand. So those are some considerations. Any you would add to that?

Yes. And I would just say if your question was how should the Street interpret the scripts and how do you gauge success. And one of the things that we looked at and we've always shared is NBRxs. NBRxs lead to the TRxs. So when you look at the evolution just this year alone in Q1 on average, through SYMPHONY data, we are averaging around 2,400 NBRxs per week. That number grew to 3,000 NBRxs in Q2, so roughly, what, 25%, 26% from Q2 to Q1. And Q3, we're seeing continued growth. And that most recent NBRx week was over 3,700. Last couple of weeks have been on average around 3,700. So we are now starting to see that impact from the expansion.

As we've shared, it takes typically 3 to 6 months from the time when you do an expansion to when you start seeing that impact. And we expanded the team, the community setting team in Q1 and Q2. So now is the time that we should see it, which we are. And even in, I would say, probably a more difficult month in the month of August, where typically things start to simmer down a little bit before September and October, but we're seeing that increase during that. So why is that important? The NBRxs will ultimately lead to the TRxs. So these NBRxs are filling essentially the pipeline that we will see in the TRxs in the months to come.

Okay. That's very helpful. And maybe just kind of one other question on this front. So in agitation, when someone gets a sample titration pack, how long does it take them to kind of go through that to where they may then convert onto a full script?

The titration, according to the label, is a 3-week titration. And so the sample of titration pack matches that. The -- and so when that converts to a script is -- we're monitoring that now because in a real-world setting, when someone fills a script, that's more than just, "Hey, are they following the label titration?" It can be earlier, it can be later. So we're monitoring to see what it nets out on average. And -- but the point is we've been sampling since the summer, since we launched the product in mid-June. And the -- so we are seeing and we expect to continue to see conversion from those samples into scripts for the maintenance dose. Okay.

And just to maybe double back on what Mark shared earlier, we are -- the demand that we are seeing for ADA is through the titration pack scripts as well as the samples that our reps are providing to the doctors. We haven't shared specifically the samples, the amount of samples, but those samples are robust. The majority of the demand is coming from samples. They are not reported in the script numbers. The titration pack prescriptions, obviously, are reported. And -- so we would anticipate that there will be eventually a transition from those samples to potentially the maintenance dose. They will likely not go on a titration pack script. They'll go directly to the maintenance dose.

Okay. That's fantastic. And I guess, I know it's -- again, it's early days, but do you have a sense for kind of the phenotype of patient that is in agitation that's taking AUVELITY? Are they often switch patients from REXULTI? Are they...

It's very early, and -- it's very early. So we're watching that. We are seeing, though, frontline utilization. But again, it's very early. So exactly how this evolves, we'll see. But we're -- what we are -- it's very exciting where it's rare these days where companies have the opportunity to provide -- to really address an unmet need.

And so now you have 2 companies doing that. And there are 2 products that are now labeled in AD agitation. There's wide and still is off-label prescribing for this indication due to the lack of approved medicines. And so now what we're seeing is just growth overall and as opposed to, say, one eating another's lunch. We are seeing on-brand growth, which is great, but it's still so early to actually say, hey, the specific type of patient profile that we expect to continue or change, it's hard to say. But right now, we like the starts of the trends that we're seeing.

And if doctors want to write it first line, they have the ability to because we have the coverage. Every Medicare participant has AUVELITY coverage. And north of 85% of them have coverage with no PA and first line or potentially one-step edit. So coverage is fully available for Part D patients if the HCP decides to write it.

Excellent. And you mentioned earlier about the long-term care facilities and kind of the growth you're seeing in that segment. I would assume that that's -- it's a pretty wide net and it's going to take some time to kind of get to all those touch points and sort of put that under the commercial umbrella. When do you expect to kind of be there in full force in selling to the long-term care facilities?

The -- one of the main differences for these facilities, the jargon is that they're activated or you bring them online, right? So you're engaging with potential prescribers there, so the doctors who are seeing patients, diagnosing them, who may be prescribing, but you have additional stakeholders in long-term care that lead to ultimate prescribing. And oftentimes, there are -- depending on the type of facility, if it's a part of a network, those stakeholders include director of nursing, pharmacy, if the pharmacy is on site or if it's part of a network that may be an umbrella over different facilities. So there are steps and activities that occur in that network of stakeholders to bring a facility online. So that way, a new product can be written within those facilities.

Now you can see certain kind of PRN or ad hoc writing here and there by certain prescribers in long-term care, but that's different from what you're talking about where you're really bringing long-term care facilities online so they can write for patients that have symptoms of agitation or now major depressive disorder in those facilities. And the reason I mentioned that, just to pause on that quickly, is we were not engaging with long-term care facilities at all prior to the approval of this new indication, AD agitation. And so now we can actually detail on both indications in long-term care. So we'd expect to see growth in the long-term care setting from both indications.

And the process that I was talking about with different stakeholder engagement, getting the product or the different NDC codes or trade configurations into those systems, it takes about a minimum of 1 month for -- on any given facility. So we're just now starting to see the impact. We touched on that with looking at the weekly scripts, the trade titration pack, NDC code, that gives you a sense. So it's just starting to come online. But really, it's not going to be steady state or fully online for some time. And we're excited about the opportunity there. It's the product profile for sure, but then also how patients have been treated historically, off-label antipsychotics. There are dynamics at play with respect to how these facilities are monitored and then rated according to how many atypical antipsychotics they prescribe. And AUVELITY, of course, is not an atypical antipsychotic. So there is -- there are dynamics at play there and considerations for -- from, say, a governance and buffering perspective that AUVELITY fits into nicely.

Great. And you said previously, there's sort of peak sales guidance around this or expectations, $4 billion a piece for MDD and agitation, which is great. I wonder if you could maybe articulate what does that kind of imply in terms of market penetration in those 2 categories?

I think if you just take a look at where we are today in MDD specifically, right, we are 26 bps of the total antidepressant market. So it's 0.26 of 1%. And we're annualizing as of the end of Q2, somewhere around $0.75 billion. So you can kind of do the math where if we just get to 1% of the antidepressant market, we're north of $3 billion already.

So one of the leading indicators on where we are going right now, I shared 0.26 in TRxs, we're 0.42, sorry, for all the numbers, but we're 0.42 in NBRx, that's a leading indicator of where the Ts are eventually going to go. And that 0.42 is continuing to grow as well. We're just -- like I said, we're just starting to see the impact of the field force. And as that continues to grow, we'll see the Ns and the Ts continue to grow.

That's MDD -- AD agitation, obviously, we've there's -- at this point in time since we've just launched the product, there's effectively no penetration. And so the -- it's a smaller patient population. It's -- however, there are fewer treatment options on label. So you would expect potentially, at steady state, a higher penetration in the market overall. But it's so early. Obviously, we've just barely scratched the surface there.

But as a reminder, we have exclusivity into assuming we get pediatric indication through the end of Q1 2039. So that's another 12 years from -- essentially for that, 12.5 years.

Fantastic. And you've spoken about this before, but I want to get kind of the current thinking in terms of net pricing and gross net discounts on AUVELITY going forward.

Yes. So we are in a better situation this year than we were last year. We started the year improved in Q1 as well as in Q2 compared to the prior year. What we have shared is that we would anticipate similar trend that we saw last year, which was a continued improvement as the year progresses. But Q2, we were approximately 50%. And last year, we were in the low to mid-50s. And in the back half of the year, we did see that improvement. So we would continue to see further improvement in the back half of this year in the GTN.

Right. Well, very good. I want to move to the pipeline because you have some interesting readouts, including one coming up with the ENGAGE study in binge eating disorder. I guess to kick this off, what is the commercial opportunity there? And what do you need to show from an effect size to have kind of a commercially competitive product?

There -- the opportunity, we think, is really compelling. There's one other approved product. That product, I think, was achieving around $0.5 billion in sales in that indication approximately. And so you're right, that's -- so our program, the ENGAGE trial, that's solriamfetol, and we've guided to top line in the fourth quarter of this year. And what we're looking for is a positive study. The -- given the dearth of approved treatments there, any new entrants, we think that's important. And so if you -- if we see a signal, we'd expect to need to run a second trial. And obviously, if the study is positive, that's something we would do. But we have a very good sense of the product profile overall now.

So set aside potential impact to binge eating episodes, that's obviously what we're looking for. We have a very good sense of the adverse reactions and the safety and tolerability of the profile of the product, which is approved. Obviously, we need to be looking for if there are any specific distinctions in this patient population. But generally, we have the sense of that. We know the scheduling, Schedule IV for SUNOSI.

So it's -- it is -- there are limited barriers to prescribing or considerations given the scheduling. So that's good.

We have other data that we've generated and published a few years ago now on SUNOSI's impact to cognition. And so the -- I'm mentioning that to give a sense of the overall product profile. And then that leads to the feedback we get from clinicians, we're looking at 4 different indications. So there's binge eating disorder, ADHD, shift work disorder and then major depressive disorder with symptoms of excessive daytime sleepiness. And what led that -- us to launch all of those programs is feedback from prescribers and clinicians that the product has global changes, positive global impact to patients. And so we're conducting a very intentional effort based on mechanism of action and potential applicability to these indications to see if we can detect a signal. And if we do, then that will lead us to conduct the next study in binge eating and go from there, and we'll have an answer soon.

That's great. And actually, you mentioned sort of shift work disorder, another program that's in the works. What is -- how big is that commercial opportunity? I think there was a Pfizer drug that may be -- is that a good example of kind of what a branded drug can do in that category?

I think we've shared $300 million to $500 million for shift work disorder from a peak sales perspective.

Yes. The -- that study is underway, and we've guided to top line next year. And in this case, binge eating disorder, we have aligned with FDA that they want 2 studies. And -- but for shift work disorder, it is considered a related indication to the currently approved indications. So this study, depending on what we see, could be NDA-enabling or sNDA-enabling.

Fantastic. And then, I guess, kind of a similar line of questions on ADHD. So you've now started another ADHD study. This is coming off of a prior study. I guess just based on the data that you've generated to date and your expectations for the ongoing study, like how do you see this fitting within the kind of competitive armamentarium of ADHD drugs?

Sure. No, we -- based on the data we have in hand, and of course, we need to complete the studies in pediatrics and so in children and adolescents, which we started just a few months ago now and are underway and enrolling, which we're excited about. The -- so I reviewed with SUNOSI, so it's solriamfetol. So I touched on some of just the general product profile attributes that are -- there are some specific differences between indications, but are generally indication agnostic. It pertains to the molecule and its mechanism of action. So that's relevant and distinct from the stimulants and non-stimulants.

We have one positive Phase III trial to date in adults and the absolute change we saw on the rating scale in adults was in line with the stimulants. So you have potentially an efficacy profile in line with the established kind of flagship products, but also a distinct safety and tolerability profile if the product is ultimately approved. So that's a really potentially compelling profile, which would be distinct, again, from the stimulants and non-stimulants if it's ultimately approved. And the market is very large. The -- and there is a high need for new entrants due to tolerability issues. And in fact, the market is so large, you regularly -- there are regularly supply constraints at this time. So there is a need just in terms of overall volume demand for new entrants.

Absolutely. And actually, if I can go back now to AUVELITY AXS-05 and it's -- the development you're doing in smoking cessation. What are the -- what does that market look like? And what are the -- I guess what's the hypothesis there for testing this in smoking cessation?

The hypothesis -- it's driven -- as all of our clinical experimentation, it's generally driven by mechanistic -- through mechanistic rationale and then some form of nonclinical or clinical data or KOL or clinician feedback. And here, we know that there are nonclinical and clinical data supporting NMDA receptor antagonism and sigma-1 agonism in this indication. We've been looking at this indication for quite a while, and we've been running air traffic control in the choreography of all of the programs that we have, and there are quite a few of them.

And so we've just started this trial, the Phase III trial, and it's a 3-arm trial, AXS-05 versus placebo and also versus bupropion. And the market is -- there are a few approved products. So there's Zyban, there's Chantix. But other than that, there's been very, very little innovation in the space. And again, this is an indication we were interested in from very early on for this mechanism. And so now we're -- there is clinical data and from -- that are available that are consistent with running the experiment, and so we'll see.

Okay. And is this an indication where maybe one trial could suffice here given...?

We'd expect to need 2 studies. Yes.

Okay. And then I also want to ask about the narcolepsy program, so AXS-12. And just we've seen ORZEYFUL, the first orexin agonist, get approved or waiting for scheduling there, so it's not in the market. But I guess how are you thinking about kind of the fit within the marketplace if this is ultimately approved in narcolepsy type 1?

Sure. The -- it's an exciting time for narcolepsy where there are new entrants and other potential entrants that are close to FDA action and AXS-12 is one of those. The profile that we saw clinically and, of course, exactly where it fits will depend on if it's ultimately approved and the -- whatever the label looks like, but we have a sense of the product profile. And it's distinct from other products approved or product candidates in development. from each reference point. So mechanistically, it's distinct from the orexins and the oxybate. And as a result, from that mechanism, we see a very specific efficacy and tolerability profile.

So we focused on cataplexy. And so, right, loss of muscle tone. We also, though, in the clinical studies, looked at excessive daytime sleepiness. So we saw improvements in excessive sleep. We saw improvements in cognition. And what ultimately ends up on a label, if it's approved, that's something we don't comment on during -- while a review is underway. However, that just speaks to the efficacy profile overall and potential differentiation. And then adverse -- from an adverse reactions perspective, if you look at -- you can look at it from, say, a scheduling perspective. And so we have that differentiation there or just rates of AEs, it's distinct. And so we saw a distinct tolerability profile, which then allows for specific patient profiling decisions or patient prescribing decisions. So we like that.

I was just going to share that the PDUFA date is May 1, 2027. And if approved, we already have a sleep franchise, as a reminder, with SUNOSI. So the infrastructure is already built and an approval for AXS-12 is super synergistic to the organization, where we believe with orphan drug pricing, we haven't shared what the specific pricing would be, but it would be accretive very quickly.

Okay. And actually, it's a great point. I wanted to maybe drill into that and understanding that some of this is proprietary and around price and things like that. But when you look at the narcolepsy landscape, there are some branded drugs that command sort of high pricing. Is the goal ultimately to kind of think -- help physicians think about combination therapy where they can add this to? Because I think you mentioned the mechanism is very different. Or the goal would be to price this in a way that this would be kind of a stand-alone?

We haven't offered commentary with respect to pricing. That's something we always wait for potential approval on. What I would say is your observation is correct. There is potential -- it could potentially be used especially depending on label, and it could potentially be used with other products, but that is not our primary focus. We're again, given the overall profile. So the idea is not to necessarily have a product that's functionally adjunctive. But should there be a use case for that as determined by a prescriber that -- I think that could be viable too, but not necessarily the North Star we're tracking to for that.

Got you. Okay. Maybe just the last minute or so, just capital allocation question. I think, Nick, you gave some helpful comments at the beginning. But just as you think about the Phase IIIs that are coming up and the launch, how do you think about kind of investing in the business sort of going forward?

Yes. Our first focus in capital allocation is growth -- top line growth. And we think we're actually resourced really well for AUVELITY. We invested in the team heavily in the first half of the year. We think, as I shared earlier in my introductory comments that we would anticipate the SG&A to essentially be plateaued to where we're at, potentially slightly increasing as the back half of the year goes if we see certain ROI areas that we want to further invest in. But that's our main focus.

From a BD standpoint, we've done BD historically over the last couple of quarters in Q4 and Q1. We brought a couple of assets in to add to our pipeline. And we'll continue to take a look if something arises that makes sense to Axsome. And then if we have additional resources, we can take a look at other things that have additional ROI, potentially stock repurchasing down the road. So -- but we're -- that would be a fortuitous problem to have.

Yes. Awesome. Well, just real quickly, any additional questions from the audience? Okay. Thank you both.

Yes. Thanks for having us.

Appreciate.

Good morning, and welcome to the Axsome Therapeutics Second Quarter 2026 Earnings Conference Call. My name is Kevin, and I'll be your operator for today's call. [Operator Instructions] Please note, this call is being recorded.

I would now like to hand the call over to Ashley Dong, Senior Director of Investor Relations. Please go ahead, Ashley.

Thank you. Good morning, everyone, and welcome to Axsome's Second Quarter 2026 Earnings Conference Call. Joining me today to discuss our results for the quarter are Dr. Herriot Tabuteau, Chief Executive Officer; Nick Pizzie, Chief Financial Officer; and Ari Maizel, Chief Commercial Officer, who will begin our call with prepared remarks. Mark Jacobson, our Chief Operating Officer; and Hunter Murdock, our General Counsel, will also be available for Q&A.

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

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

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

Thank you, Ashley, and good morning, everyone. The second quarter was highly productive for Axsome as we grew our commercial business robustly and made important regulatory and clinical progress across our innovative neuroscience pipeline. In the second quarter, our commercial portfolio generated $218 million in net product revenue, a 46% increase year-over-year, driven by strong performance for Auvelity and Sunosi.

In the quarter, we launched Auvelity in Alzheimer's disease agitation and completed the expansion of the Auvelity sales force. Early metrics for the sales force expansion in Alzheimer's disease agitation launch point to growth acceleration for Auvelity. Underlying demand growth for SYMBRAVO is also accelerating, and we expect Sunosi growth to continue outpacing the market, positioning us for continued strong growth across the entire commercial portfolio. Later in the call, Nick will comment further on our financials, and Ari will provide additional detail on our commercial performance, including early observations in the Alzheimer's disease agitation launch.

During the quarter, we also advanced our leading neuroscience pipeline of 6 innovative product candidates, which we are developing for 10 serious conditions. Our broad late-stage neuroscience pipeline positions us to potentially file on average on new NDA each year between now and 2030, delivering potentially significant value to patients and stakeholders. Following Ari's remarks, I'll provide an update on each of these programs.

With that, I'll turn the call over to Nick.

Thanks, Herriot. Good morning, everyone. I'll begin with a review of our financial results for the quarter. Revenue increased to $218 million compared to $150 million in Q2 of 2025, representing a 46% year-over-year growth. Performance was driven by Auvelity with steady growth from Sunosi and continued strength in prescription demand for SYMBRAVO. We recorded net product sales for Auvelity of $180.3 million in the quarter, that's a 51% increase compared to the second quarter of 2025 and an 18% increase quarter-over-quarter.

Sunosi net product revenue for the quarter was $35.8 million, representing a 20% year-over-year growth. Sunosi revenue consisted of $33.8 million in net product sales, $1.5 million in royalty revenue associated with Sunosi sales in out-licensed territories and $0.5 million in milestone revenue.

Net sales for SYMBRAVO were $2.3 million in the quarter. SYMBRAVO was launched in June of 2025 and had net product sales of $400,000 for the second quarter of 2025. The decrease of $1.8 million in net sales from Q1 of 2026 primarily reflects a prior period adjustment and increased utilization of our patient service program driven by underlying demand growth.

As such, SYMBRAVO gross to net discount deviated from trend during the quarter into the high 80% range. We anticipate SYMBRAVO-GTN to return to prior levels for the remainder of the year. Gross net discounts for Auvelity and Sunosi were each approximately 50% for the second quarter. We continue to anticipate gross net discount for both products to improve throughout the year, consistent with prior year trends.

Turning to expenses. Cost of revenue in the quarter was $13.6 million represents 6% of total net revenue. Cost of revenue for the second quarter of 2025 was $13.4 million. Research and development expenses decreased to $46.2 million for the second quarter of 2026 compared to $49.5 million in the second quarter of 2025, which primarily reflects lower costs associated with AXS-05 and AXS-14.

Selling, general and administrative expenses in the quarter were $208.1 million compared to $130.3 million for the second quarter of last year. The increase was primarily driven by commercialization activities for Auvelity and SYMBRAVO. Finally, net loss for the quarter was $51.3 million or $0.99 per share compared to a net loss of $48 million or $0.97 per share for the second quarter of 2025. Net loss in the quarter includes $27.1 million in stock-based compensation expense.

Turning to the balance sheet. We ended the quarter with approximately $320 million in cash and cash equivalents. This compares to $323 million as of end of 2025. As evidenced by this quarter's financial performance, we are seeing continued improvement in operating leverage while investing behind our key commercial opportunities and pipeline priorities. Based on our current operating plan, we continue to expect that our current cash balance is sufficient to fund anticipated operations into cash flow positivity.

Now I'll turn the call over to Ari with a commercial update.

Thanks, Nick. During the second quarter, we saw strong underlying demand growth across our portfolio of 3 differentiated medicines. In addition, during the quarter, we further strengthened our commercial foundation positioning us to drive growth across the portfolio over the balance of the year.

Beginning with Auvelity. In the quarter, we launched Auvelity in the Alzheimer's disease education market and completed the expansion of the Auvelity sales force. I'm happy to share that early metrics indicate that these 2 developments are already beginning to have a meaningful impact on demand growth, positioning Auvelity for continued momentum over the balance of the year.

Regarding Alzheimer's disease agitation, during the first 8 weeks following the launch in this indication, new-to-brand prescriptions among patients 65 years of age and older increased 126% compared to the same period in the prior quarter. reflecting expanding adoption in this patient segment. New-to-brand prescriptions represent new patients starting on Auvelity for the first time and are considered a key leading indicator of growth.

While it's early days in the commercialization of Auvelity and Alzheimer's disease agitation, we are excited by the initial feedback that we have received from prescribers which includes positive anecdotal evidence of Auvelity's differentiated clinical profile reflected in real-world patient experience. In particular, providers and care partners alike view the reduction in agitation symptoms and safety and tolerability profile favorably. These early experiences have reinforced our belief that Auvelity has the potential to transform the treatment paradigm for Alzheimer's disease agitation and we look forward to sharing continued progress in the months ahead.

We are also beginning to see the early impact of our expanded sales organization with overall new-to-brand prescriptions in the second quarter of 2026, increasing 26% compared to the first quarter of 2026. This momentum has continued into the third quarter. In addition to accelerated new patient starts, the expanded sales force activated more than 6,800 new Auvelity prescribers in the quarter, representing 21% growth versus the previous quarter, bringing the total number of unique prescribers since launch to approximately 69,000.

The inflection in new-to-brand prescriptions and increased velocity of new writer activation are strong leading indicators of our expanded sales force investment and resulted in market share gains for both new-to-brand and total prescriptions in the quarter. We expect these trends to continue to build in Q3 and Q4, translating into positive TRx trends and further market share penetration.

Overall, total prescriptions for Auvelity in the second quarter reached approximately $266,000, an increase of 34% year-over-year and 12% sequentially substantially outpacing the antidepressant market, which grew 1% and 2% in the same time period, respectively. In addition, Auvelity market access continued to improve during the quarter, with coverage now at approximately 89% of total lives across channels, including 82% of commercial lives and approximately 100% of lives in the government channel.

Our market access team is working closely with payers in both the commercial and government channels, and we expect patient access for albeit in both the MDD and ABA markets to continue to expand and evolve. Taken together, we expect the momentum from the sales force expansion, continued growth in MDD and uptake in Alzheimer's disease agitation to drive continued growth over the rest of the year.

For SYMBRAVO, demand was strong, growing 30% quarter-over-quarter to approximately 23,500 total prescriptions. Prescriber and patient feedback continue to be very positive supporting our commercial strategy to drive prescription volume while improving market access to support sustained growth over time. As mentioned on our prior earnings call, based on the strong demand for SYMBRAVO to date, our previously announced sales force expansion to approximately 150 sales representatives is substantially complete.

Finally, following the previously announced addition of approximately 17 million lives in Q2, overall payer coverage is now at approximately 57% of lives covered across channels, including approximately 56% of commercial lives and 57% of government lives. We expect coverage for SYMBRAVO to further improve moving forward.

Sunosi delivered another quarter of durable growth with approximately 61,000 total prescriptions written during the quarter. representing 14% year-over-year growth and 8% sequential growth compared to a 1% decline and 2% increase for the waste promoting agent market in the same periods, respectively. More than 17,000 clinicians have now prescribed Sanofi since launch, and we continue to maintain broad payer coverage of approximately 82% of lives covered across all channels.

Overall, the underlying commercial performance in Q2 reflects positive momentum for Axsome's portfolio of differentiated CNS products. Acceleration of Auvelity in MDD and Alzheimer's disease education continued market penetration for SYMBRAVO and migraine and consistent growth from Sunosi and EDS associated with narcolepsy and OSA position Axsome for a strong second half of 2026 and robust growth in the years ahead.

I will now turn the call back to Herriot.

Thank you, Ari. We are excited by our innovative neuroscience pipeline, which targets high unmet medical needs, novel indications first-in-class mechanisms of action and best-in-class profiles. I'll now review the recent pipeline progress and discuss key upcoming clinical and regulatory milestones.

In the quarter, the FDA accepted our NDA submission for AXS-12 for the treatment of cataplexy in narcolepsy with a PDUFA target action date of May 1, 2027. based on its differentiated mechanism of action and resulting clinical profile, AXS-12 has the potential to provide a meaningful addition to the treatment armamentarium for patients living with narcolepsy if approved.

For AXS-05, the next indication under development is smoking cessation. We are on track to initiate our planned Phase II/III trial in this indication this quarter. Exploring the full clinical potential of AXS-05 remains a top priority for us based on its unique pharmacology, which is potentially applicable across multiple neuropsychiatric disorders.

Solriamfetol, our clinical programs across 4 new indications continue to advance. As a reminder, the new indications being explored are ADHD, binge-eating disorder, MDD with excessive daytime sleepiness or EDS symptoms and EDS associated with shift work disorder. All in all, we currently have 5 Phase III trials underway across these indications.

In ADHD, we recently initiated the FOCUS-2 and FOCUS-3 studies of solriamfetol in children and adolescents with ADHD. These studies use a parallel group design with a primary endpoint of change from baseline to week 6 in the ADHD rating scale. These 2 studies if positive, together with the previously completed positive FOCUS Phase III trial of solriamfetol in adults would form the basis of an NDA filing for solriamfetol in the treatment of ADHD.

In binge eating disorder, our ENGAGE Phase III trial continues to enroll, and we anticipate top line results from the study in the fourth quarter of this year. Our CLARITY Phase III trial of solriamfetol in MDD with ADS. Our SUSTAIN Phase III trial soloinfetol, NEDS associated with the shift work disorder are also advancing.

For AXS-14, which we are developing for fibromyalgia enrollment in our FORWARD Phase III trial continues to progress. The FORWARD trial, if positive, together with the previously completed positive Phase II and Phase III trials would support an NDA filing for AXS-14 for the treatment of fibromyalgia.

With AXS-20, our first-in-class selective PDE10A inhibitor, we are making good progress in our chemistry, manufacturing and controls activities with the goal of initiating a Phase III trial with this molecule in schizophrenia. We are also advancing Phase II enabling activities for AXS-17, our GABA subtype selective PAM, which we are developing for epilepsy.

In summary, we are excited by the programs in our leading neuroscience pipeline. Combined with building momentum in our existing commercial business, these programs targeting areas of unmet medical need lay the groundwork for continued growth and value creation for patients and stakeholders.

I will now turn the call back to Ashley.

Thanks, Herriot. This concludes our prepared remarks, and we'll now begin the Q&A session. To allow enough time for as many questions as possible, we kindly ask that you limit yourself to one question. Operator, please open the line.

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

Just one maybe on the Alzheimer's agitation launch, specifically as it relates to long-term care I guess, can you talk about the trends that you're seeing in the long-term care, I guess, the enthusiasm there? And then given that it's a new area that you're launching into sort of any successes or challenges that you're seeing there?

Thanks, Leo, for the question. As we stated on the -- earlier on the call, we're just 8 weeks into the launch. We're really encouraged by some of the early data we're seeing, the early patient experience has been very promising. We're seeing strong growth in new-to-brand prescriptions in patients aged 65 and older. And that feedback is consistent from both the community and long-term care settings.

So obviously, as we get further into the launch, we'll be able to share some additional details around specific settings of care, but we've been really encouraged by what we're seeing across both LTC and community.

Our next question is coming from Malcolm Hoffman from BMO Capital Markets.

You highlighted some pretty strong growth in NBRx for Auvelity and the 65-plus patient group there. Can you maybe break this out further to indicate how much of this may be driven by agitation versus MDD expansion as well?

Yes. Thanks so much for the question. As we mentioned on the call, NBRx growth was very positive, 26% versus Q1. We are seeing meaningful increases in both MDD and Alzheimer's disease agitation, which we would expect to continue moving forward.

Our next question is coming from Ash Verma from UBS.

Congrats on the progress here. Maybe just on like Alzheimer's agitation. Can you talk about the level of sampling that you need to do early in the launch. And as the time progresses, would that gradually be lower -- is this sampling going to be more or less than the MDD launch that you did? Just help us understand so that we can correlate to data that we are seeing at our and other third-party sources.

Yes. As it relates to sampling, particularly in the community setting, sampling is important to gain trial with patients, and we've been committed as an organization to ensure that patients are appropriately titrated based on the approved dosage and administration. I think it's a little too early for us to indicate how sampling will change over time. But right now, we're very pleased with the strong demand for samples and it's been applauded by the clinical community in order to get patients started effectively and to give them the best chance for the clinical profile that we saw in our Phase III clinical trials.

Next question is coming from Rudy Li from Wolfe Research.

For ADA, can you provide more color on the capital rate of like IQVIA of the prescription data for the titration package and what additional key commercial metrics you'll be monitoring to track the progress?

Yes. I would say on the capture rate for the titration pack specifically, there's really limited data. So we'll learn more as we get further into the launch. In terms of ongoing performance data, I think obviously, sharing information about adoption or utilization with patients who are 65 years and older was an important signal for this particular call. And as we get more data into the launch, I think we'll update based on the most relevant trends related to the launch.

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

Nick, can you talk about where you think Auvelity gross to nets will settle out in, let's say, 2 years after both of these indications or kind of going? And just for depression alone, what first line, second line, what percentage are we up to now?

Sure. Mark, so maybe first, where we were for the LD and GTN for -- this quarter, we were around 50%, as I shared in the opening remarks, that's obviously with the increase in covered lives and also with improving the quality of coverage to the first-line or for switch. As you alluded to in a couple of years, we anticipate Medicare scripts to become a higher proportion of scripts compared to commercial. What we've shared longer term is that we would anticipate GTN to remain in the 50s. And we'll be able to give better guidance probably towards the end of the year as we see this launch grow in ADA.

Yes. And as it relates to first, second line use in this quarter, we saw about more than half of the patients, 56% were treated in the first or second line setting. As we've shared previously, we don't have a particular percentage in mind. We know that Auvelity has been effective in patients as early as treatment naive and its latest as treatment experience. And so we're very comfortable with what we've seen over the past few years, and it's certainly supporting continued growth in both MDD and Alzheimer's agitation.

Our next question is coming from Ami Fadia from Needham & Company.

Maybe if you can talk about some of the market dynamics with SYMBRAVO and talk about the evolution of the adoption rate there and how do you see that progressing over the coming months?

Yes. Thanks for the question. I mean we're very pleased with the underlying demand for SYMBRAVO. As we stated earlier, it grew 30% versus Q1 and we're receiving very positive feedback from both patients and providers around SYMBRAVO's clinical profile and impact on patients. We expect that to continue. We mentioned that our sales force is expanding to approximately 150 sales representatives. That will enable us not only to call on higher decile headache specialists with more frequency, but also continue to expand and penetrate the primary care setting, which has been key source of growth over the past several quarters.

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

Congrats on the quarter. This is [ Matt Marcus ] on for Andrew Tsai. I just wanted to ask, can you confirm what the exact percentage of your Alzheimer's agitation scrips or samples right now? And then since samples tend to run out in 2 to 3 weeks, any patient in June, July, a sample should be converting to a national patient by now, you think? So is the total Auvelity weekly script growth in the last couple of weeks, representative of the weekly growth profile that could be going forward? Or would you absolutely expect a faster cadence in August and September compared to June and July?

Yes. Thanks for the question. We don't share specific details regarding sampling as a proportion of overall demand. But we've been very pleased with the overall demand for samples in the community setting. And again, I think that, that's a very important aspect of the launch to support effective titration for elderly patients. In terms of weekly growth, as we mentioned, we've got 8 weeks of data that we're sharing today. We expect to learn much more in the coming months related to the launch, but we've been very pleased with the early indicators.

Our next question is coming from Pete Stavropoulos from Cantor Fitzgerald.

Congrats on the quarter. For AXS-12 reboxetine, there was the first approval of an orexin 2 receptor agonist last week. How do you think about the underlying commercial opportunity for reboxetine in the neurocolelpepsy market that has this new class of drug approved. Also, have you had discussions with payers around the profile of AXS-12 and possible pricing?

Great. Thanks for the question. I'll take the first part of that question, and Ari can take the second part. If you look at the narcolepsy market, we know that it is characterized by a lot of heterogeneity in the narcolepsy patient population. So more treatments are better for patients.

We're excited by the potential for AXS-12 to provide a new and differentiated treatment option for patients living with narcolepsy. If you think about it mechanistically, it works on the orexin pathway. Orexin stimulates the local cereals to produce norepinephrine and AXS-12 also stimulates norepinephrine production.

What we like about AXS-12 clinically or a few things. One, it works very quickly. We have onset of action, which is demonstrated at 1 week. Secondly, the efficacy is durable. We have data out to 6 months. And if you look at the side effect profile, it is very favorable. You combine that with a first-in-class mechanism interaction for narcolepsy. And also, you look at the clinical data, which shows that there is the potential to affect EDS as well as cognition. So we're very excited by the potential to provide a new treatment option for patients, and we think that, that will be welcome in the marketplace.

Yes. And regarding your question about market access, we've had very productive conversations with payers as they're learning more about AXS-12. And obviously, there's a lot of interest in narcolepsy. We won't comment on pricing until closer to the launch. But we feel very optimistic about the potential for patient access for AXS-12.

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

Just wanted to see how you're thinking about the relative positioning of balipodect in schizophrenia. And if you are thinking about specific treatment combinations positioning as adjunct treatment versus stand-alone and what the prospects are for applicability of this drug in neuropsych indications beyond schizophrenia down the road?

Sure. Thanks, Ram, for the question. We're really excited by the prospects for balipodect in schizophrenia. Right now, what we're doing is we are conducting chemistry manufacturing controlled activities to at able the start of a Phase III trial in schizophrenia. So stay tuned. That work is well underway, and that is a priority for that program.

Other indications that we're looking at or Tourette's syndrome. So we've stated that we do intend to initiate a Phase III trial -- a Phase II trial in that indication also. So that molecule and the clinical programs are progressing. As it relates to how it would be used either as monotherapy or with other products, it's too early. We want to do the experiment, and that's the Phase III trial.

We are encouraged by the results of the Phase II trial, which was conducted in this patient population, which showed a very significant treatment effect if you look at a product as well as a favorable side effect profile, which dovetails very nicely with the unique mechanism of action of the product.

Our next question today is coming from David Amsellem from Piper Sandler.

So on AD agitation, and I know these are early days, but do you have a good read regarding how the drug is being used relative to reuptake inhibitors. Are you seeing usage in frontline or downstream of reuptake inhibitors that historically have been used off-label in AD agitation or maybe a mix of both? Just wondering if you have a sense of where the usage mix is falling again in these early days.

Yes. Thanks for the question, David. I think the data is limited at this point regarding where patients are coming from, if they're switching from SSRIs, SNRIs, atypical antipsychotic and the line of treatment, we'll learn more as the launch progresses. But I would say, in general, the anecdotal feedback we're getting is that the drug is working per the label, meaning that we're seeing rapid onset of action, a reduction in both the severity and frequency of symptoms and the safety tolerability profile has been viewed favorably by both HCPs and care partners alike.

So I think we'll learn more in the coming weeks and months about line of usage and where the patients are coming from. But we're very pleased with the early response we're hearing.

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

Mine -- so it sounds like some impressive physician or prescriber expansion metrics, I think, plus 6,500, I think I heard. That I guess, breadth of prescriber expansion, how much of that is just neurologists, someone who's maybe more of a unique prescriber to ADA versus, say, primary care type of prescriber that might be prescribing ability across both indications. I don't know if you have a sense of -- as you're seeing that prescriber base expand, if it's more just breaking into the newer prescribers unique for ADA or if you're getting prescribers who could potentially drive growth in both indications.

Yes. Thanks, Jason. I think for the Q2 data, it's largely related to our sales force expansion. And we're very pleased with those early signals as it relates to new writer activation, obviously, NBRx or new-to-brand prescription growth which largely is coming from the sales force expansion and predominantly from growth within the MDD indication. So for this particular quarter, I would say neuros may not be representative necessarily Primary care is the predominant growth driver within Q2 data specifically.

Obviously, as the launch progresses in Alzheimer's agitation, we would expect to see more specialists adopt. But for this particular quarter, I would say that really nice growth in the site specialties, but faster growth within primary care.

Our next question is coming from Sean Laaman from Morgan Stanley Investment Management.

Just thinking to your peak revenue assumptions for Auvelity, which of these would have the greatest impact among prescriber activation, long-term care penetration, treatment duration, payer access and market expansion into previously untreated patients, which has the greatest sensitivity.

Yes. Thanks for the question. I think all of those things are important. Obviously, we'll be focused on all aspects, and accelerating new rider activation, I think new-to-brand prescriptions are a really important leading indicator of long-term growth potential. That's a key area of focus. As we've demonstrated our ability to expand market access and payer coverage for our brands has also been very positive. So I would say it's difficult to pick just one of the elements that you're describing. But we -- from a commercial perspective, we're focused on improving execution across the board.

Our next question today is coming from Brian Skorney from Baird.

I was hoping you did help us think through a little more on the sampling impact in the early days of the Alzheimer's agitation launch. Are these free samples at point of care? Is this primarily a coupon card that's issued at point of care or online and turned in at the pharmacy that covers the full cost of treatment. Just trying to think would it be reasonable to assume most of the NBRxs in Alzheimer's agitation right now are free samples.

And for a Medicare patient, would the goal be to have them on commercial at the first refill, like do you see sampling as a bridge to securing best coverage for the patient? Or is it to getting over initial abandonment of the new prescription over the co-pay.

Yes. Thanks for the question, Brian. Sampling, when we relate -- refer to sampling, we're primarily talking about free samples trial offer that is provided to community-based settings where the clinicians are able to give a sample to a patient or care partner during an office visit. It's an important aspect of any launch in order to encourage trial and to really give early patient experience with the product. As you can imagine, in the Alzheimer's population, there's a heightened sensitivity just to the patients and safety tolerability aspects. So this gives them a chance to see how the drug performs in advance of a first prescription.

We expect to continue to sample as appropriate. It's been applauded by the clinician community primarily because it allows the patient to go home with the titration doses in order to get up to a steady state on the maintenance dose when they're home. So I think we'll have more to share down the road as we see more data related to sample conversion. But I would just say that samples are not prescriptions, so they're not showing up in the IQVIA data. that's an important factor as you think about it.

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

Maybe on binge eating disorder. Can you comment on the clinically meaningful result that you're looking for later this year on reduction in episodes? Or is it just that sign placebo response and binge eating disorder studies can sometimes be reasonably high, especially if the patient population maybe isn't severe enough. So can you comment on your overall level of comfort with the patient population that you did enroll in this trial?

We're very comfortable with the patient population. We think that we designed a study and we were enrolling patients that are appropriate to be studied in the clinical trial in binge eating disorder. As it relates to BOEs, we don't have any. So we designed a study. We powered it for statistical significance, and that's what we're looking for.

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

I also wanted to ask about Auvelity and the new-to-brand growth rate that you mentioned, 26% quarter-over-quarter. Just wanted to see if we could get maybe a little bit more context for this number? Like how does this number compare to the prior period in Q1? And just based on what you're seeing, what kind of growth should we sort of be thinking about in Q3?

Thanks for the question. So regarding the new-to-brand growth rate, I think one thing that could be helpful in the first quarter, we saw essentially equivalent growth from both the total prescriptions and new-to-brand prescriptions perspective. In Q2, we saw a step-up in growth, 26% with new-to-brand prescriptions and 12% for total prescriptions. I think that's a strong signal of the impact of our sales force expansion in the quarter, and we would expect that to continue to build into the second half of the year.

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

My question, it's really related to how we should all think about Alzheimer's disease agitation and uptake there. Trying to get a sense of if you could provide some color on how we should think about kind of the smoothness of the uptake? Or do you anticipate that whether it's due to the sales force expansion or just greater awareness that there will be a sharp inflection, whether there are formulary approval dynamics, anything that could give us a better sense of how we should think about the uptake over the next several quarters or a year for that matter.

Yes. Thanks, Graig. I think a couple of points I'd point to. Number one, we expanded the sales force. And in the quarter, we saw meaningful acceleration in new brand prescriptions and new retro activation. As you know, with 8 weeks of launch data and Alzheimer's agitation, the majority of that growth came from MDD. We expect MDD to grow as Alzheimer's agitation launch is ramping up.

And well, I think we'll have more to say, obviously, with more data on the Alzheimer's launch. The early indicators are very promising. I think it's premature to say exactly what the inflection will look like. But the early signals that we shared earlier, including the NBRx growth, the positive clinical experience we've received the growth in patients 65 and older, all point to very strong leading indicators that we expect to build throughout the rest of the year.

The next question is coming from David Hoang from Deutsche Bank.

So I want to ask a little bit about any, let's say, qualitative commentary. You may be getting from your field force about how docs are thinking about the decision for a branded product in Alzheimer's agitation. So obviously, there is the Rexulti is the other approved product out there. And so any color commentary on how docs are approaching Auvelity versus Rexulti would be helpful? And then are you hearing anything in terms of step edits or prior authorization that payers are asking for ADA.

Yes. Thanks, David. I think, first of all, there's still a significant need for provider education, the Alzheimer's disease agitation market. This is a market that did not have any approved products just a couple of years ago. And so there's still some education required, which we've been really proud to be a part of treatment intervention has often been reserved for more severe forms of agitation, particularly in primary care. And so that's been a point of education regarding the benefits and rationale for earlier innovation.

As it relates to branded products, I think, ultimately, providers want to help patients, and there has not been anything approved with this type of profile historically. And so there's a lot of interest in learning more about the clinical profile both from an efficacy, safety tolerability standpoint. And the leading indicators, I think, are very promising in that regard.

From an access standpoint, we're really pleased with the coverage that we had at launch, 100% coverage in the Medicare channel. More than 75% of patients do not require a PA. Of course, PAs can still pop up depending on the patient's coverage. In terms of step edits, by and large, we're very pleased that patients will gain access to the albeit based on their prior treatment experience or based on the coverage that they have. And so all of those things really point to continued progress in the launch moving forward, and we'll obviously share more updates as we get more data moving forward.

Our next question is coming from Yatin Suneja from Guggenheim.

This is Eddie on for Yatin. So acknowledging it's still very early, what are prescribers telling you about early patient response and continuation on Auvelity and ADA? Are you picking up any differences by prescriber setting just in terms of how they're monitoring or plan to monitor and follow-up with patients as they get treated?

Yes. Thanks for the question, Eddie. I think the response has been really consistent regardless of setting of care or specialty. And that is that Auvelity has been effective at reducing both the frequency and severity of agitation symptoms with a favorable safety tolerability profile we'll obviously learn more as the launch progresses. But so far, it's been very consistent, both in terms of specialists as well as setting of care.

Our next question is coming from Madison El-Saadi from B. Riley Securities.

Maybe on the 2Q revenue, how much of that reflects any kettle stocking versus spins demand? If you could just help, sorry if I missed it. And if you could just help clarify the underlying operating cash burn, if you stop working capital and everything away. Just asking in the context of your past to breakeven?

Sure, Madison. So first off, the full revenue this quarter was related to demand. There was no stocking at the end of the quarter continue to be roughly at 2 weeks of inventory on hand. So no change as it relates to that. And if you take a look at our cash burn for the quarter, it was somewhere in the neighborhood of $24 million or $25 million, taking the net loss and backing out the majority of the noncash loss is related to stock-based comp more than half of that. So your neighborhood does unloaded mid-20s from a cash burn.

And what we shared is that our SG&A for the remainder of the year, we would have anticipated to essentially plateau to where we are this quarter in Q2 of $208 million as we're fully staffed and built the foundation for Auvelity as well as SYMBRAVO. R&D will continue to pick up as we've commenced the ADHD trials. But Importantly, we should see operating leverage continue in the back half of the year. We saw that this quarter with revenues growing at 14% and OpEx growing at 7%.

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

Team, this is John on for Myles. I was wondering if you can give us any updated plans for the DTC campaign for Avalite with the ongoing launch in AD agitation.

Thanks, John. We evaluate -- obviously, DTC is an important part of our marketing mix, and we've been pleased with the impact of our direct-to-consumer investments across really all of our brands, but Albeit specifically over the past year or so. Given that it's still only 8 weeks into the launch, we're assessing the potential for a more substantial DTC effort.

Right now, we are investing in consumer marketing, primarily focused on care partners but the potential for something more broad reaching like TV or video advertising is something that we'll continue to evaluate as the launch progresses.

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

Thank you. Our Axsome business advanced significantly in the second quarter. Our commercial strategy is translating into long adoption of our medicines. Our pipeline continues to progress towards multiple milestones with substantial value creation potential. Our strong financial position allows us to continue investing behind our strategic priorities to maximize the long-term potential of our portfolio of medicines. We are excited for the remainder of the year and look forward to sharing updates on our progress. Thank you all for joining us, and have a great day.

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

The main...

With the addition of ADA?

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

We can go another hour, if you like.

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

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

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

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

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

Thank you.

Thank you.

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

Thanks for having us. Thanks, Jason.

Thank you, Jason. Have a good day.

All right.

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

Next question is coming from Marc Goodman from Leerink.

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

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

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

Next question is coming from Andrew Tsai from Jefferies.

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

Next question is coming from David Amsellem from Piper Sandler.

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

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

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

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

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

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

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

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

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

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

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

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

Next question is coming from Sean Laaman from Morgan Stanley.

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

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

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

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

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

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

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

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

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

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

Next question is coming from Myles Minter from William Blair.

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

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

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

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

The next question is coming from Matthew Hershenhorn from Oppenheimer.

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

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

Next question is coming from Ben Burnett from Wells Fargo.

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

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

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

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

Our next question is coming from Greg Suvannavejh from Mizhuo.

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

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

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

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

The next question is coming from Brian Skorney from Baird.

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

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

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

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

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

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

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

Next question is coming from Rudy Li from Wolfe Research.

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

So maybe I can start with that.

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

Congrats again on this landmark approval.

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

I think with that, that concludes our presentation.

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

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

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

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

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

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

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

Thank you.

Thanks a lot, Jason. Thank you.

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

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

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

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

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

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

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

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

Yes.

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

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

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

Yes. And DTC advertising has started?

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

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

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

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

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

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

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

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

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

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

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

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

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

So where is it being used in the migraine space?

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

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

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

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

We're still in the limited launch phase.

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

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

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

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

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

Binge eating...

Mechanistically. Yes.

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

Shift work, binge eating disorder, ADHD.

ADHD, sorry.

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

And is pain one of the endpoints?

Yes. Yes.

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

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

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

17, yes.

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

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

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

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

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

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

Correct. Yes, yes, exactly.

And you're not going to pursue GAD.

Yes, yes. That's not the plan.

You're thinking of epilepsy.

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

Yes. No, for sure.

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

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

12? Talk about 12.

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

The next thing.

One minute of 12.

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

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

Yes. Excellent.

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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