Axsome Therapeutics, Inc. (AXSM) Earnings Call Transcript & Summary

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

The -- 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. The -- 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 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 ride 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 is potentially a pharmacy network or a central pharmacy and there are stakeholders and decision-making gating process there, 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 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 is 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 riding there. So -- 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's 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 potential 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 an 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 and a certain number of trial for any given prescriber, the feedback similar to the 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 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, a steady state from penetration. So there's -- we're at about -- right now, with NBRxs, we're at 42 basis points, so 0.421% which is a leading indicator of where we would expect the TRx, which is just under -- or just right around 25% of 1% so 0.26 So that will give a good indicator at 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 that 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 frankly as they need to be. The more that you're able to detail and share the benefits of belt, the more likely that doctors will think about what patient is the right fit for Avelity. . SPEAKER01 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 to...

Sure. Yes. access -- the great thing about access is it's improved and it's involved over the last even 12 months. So right now, there is 89% total lives covered for ability 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 or I'm sorry, first line or first switch. So access covered lives is at a really nice level rate now with great formulary access and just go 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.

So the -- and going back to your question about just growth in MDD and continued growth at MD. 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 team's now got, on average, 4 to 6 months, probably about 4 to 5 months of year now at Axon. 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.

All right. I'm sure we could spend another hour talking about quality. 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 rapid onset, cataplexy reduction, cognitive benefit. How do you sort of see this fitting into the current MT1 treatment landscape where polypharmacy is common, but also on the backdrop of the orexin [ treetoagonist ] entering 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 focused on cataplexy as the primary endpoint in our clinical program. but we also look at excessive daytime sleepiness, which we saw benefit and improvement in 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 great and 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 it's as far as orphan goes, it's not ultra-orphan, and there's a pretty dramatic need for new treatment options. And 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 a super synergistic. We have obviously the sleep expertise now in-house with Sunosi, and we've been detailing that 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 acquired and everything would just incrementally fall to the bottom line. So from a financial perspective, it makes a lot of sense.

All right AXS20. So in April, you announced that you acquired this PD [indiscernible] Inhibitor from Takeda. What exactly attracted you to it?

Sure. The 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 us, that's really important. And how do you how do you offer innovation to patients and prescribers and to us, that always starts with the mechanism. So here, we have potential novel mechanism for schizophrenia. We also mentioned that we're interested in exploring potential applicability in Tourette's syndrome. And there are -- there's -- so you have mechanistic rationale and you have clinical rationale -- there's a can 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, and -- 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, AE profile, so from the Phase II -- so 1 of the problems with drugs in schizophrenia, right, is tolerability and then the 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 1 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 II. 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 do 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 looking forward for more progress. And .

Yes. We know we'll definitely do that. And thanks for having us. Pete. Appreciate. Thank you