Greetings, and welcome to Alkermes' Third Quarter 2025 Financial Results Conference Call. My name is Rob, and I'll be your operator for today's call. Please note that this conference is being recorded. I will now turn the call over to Sandra Coombs, Senior Vice President of Investor Relations and Corporate Affairs. Sandy, you may now begin.

Thanks, Rob. Welcome to the Alkermes plc conference call to discuss our financial results and business update for the quarter ended September 30, 2025. With me today are Richard Pops, our CEO; Blair Jackson, our Chief Operating Officer; Todd Nichols, our Chief Commercial Officer; and Joshua Reed, our Chief Financial Officer. A slide presentation, along with our press release, related financial tables and reconciliations of the GAAP to non-GAAP financial measures that we'll discuss today are available on the Investors section of alkermes.com. We believe the non-GAAP financial results in conjunction with the GAAP results are useful in understanding the ongoing economics of our business. Our discussions during this conference call will include forward-looking statements. Actual results could differ materially from these forward-looking statements. Please see Slide 2 of the accompanying presentation, our press release issued this morning and our most recent annual and quarterly reports filed with the SEC for important risk factors that could cause our actual results to differ materially from those expressed or implied in the forward-looking statements. We undertake no obligation to update or revise the information provided on this call or in the accompanying presentation as a result of new information or future results or developments. After our prepared remarks, we will open the call for Q&A. And now I'll turn the call over to Richard for some opening remarks.

That's great, Sandy. Thank you. Good morning, everyone. So Alkermes delivered a strong third quarter. It was marked by solid commercial execution, significant progress in our development pipeline, robust financial performance and continued execution across our strategic priorities. Today, we're raising our financial expectations for 2025, reflecting our confidence in the momentum of the business. Before we dive into the results for the quarter and our increased expectations for the remainder of 2025, I'd like to take a moment on the announcement we made last week regarding our proposed acquisition of Avadel Pharmaceuticals. This transaction is an important step forward in Alkermes' strategic evolution for three compelling reasons. First, we gain an FDA-approved medicine with significant growth potential. LUMRYZ is the first and only FDA-approved, once-at-bedtime oxybate for the treatment of cataplexy or excessive daytime sleepiness in patients 7 years or older with narcolepsy. It has already shown strong market uptake since launch. In 2025, it is expected to generate between $265 million to $275 million in net revenue. Once the transaction is complete, it will immediately diversify our commercial portfolio and strengthen our profitability. Second, this acquisition will accelerate our commercial entry into the sleep medicine market. It will provide a well-established foundation for the potential launch of alixorexton, our promising orexin 2 receptor agonist in development for narcolepsy and idiopathic hypersomnia. Avadel is a recognized leader in sleep medicine and has successfully built and scaled a high-performing commercial organization. With positive Phase II data for alixorexton in narcolepsy type 1 now in hand, data from Vibrance-2 in NT2 that we expect to report in November, and plans to initiate a global Phase III program early next year, we have reached a new level of conviction in the potential of our orexin platform. And third, the financial strength of the combined company will enhance our ability to support a diversified development strategy in sleep disorders. This will include alixorexton, as well as our additional orexin 2 receptor agonist candidates, ALKS 4510 and ALKS 7290, which recently entered the clinic. Avadel’s development pipeline also has the potential to broaden our offerings for the sleep community, with an ongoing Phase III study of LUMRYZ in idiopathic hypersomnia and valiloxybate, a no-salt oxybate candidate in early-stage development. The proposed acquisition reinforces our commitment to neuroscience. It gives us additional scale and builds on our legacy of innovation in complex psychiatric and neurological disorders. The transaction is a compelling opportunity to accelerate our growth trajectory and is squarely aligned with our financial and strategic priorities. Upon closing, which we currently expect in Q1, we'll be able to provide more detail on our expectations for the combined business. So with that as an intro, I'll turn it over to Joshua, who will walk through our third quarter financial results.

Thank you, Richard. I'm pleased to join you today for my first earnings call as Chief Financial Officer of Alkermes. I'm excited to be part of a company with a strong financial foundation, a clear strategic vision and a deep commitment to delivering value for shareholders while advancing innovative medicines that have the potential to make a meaningful difference for patients. Since joining, I spent time getting to know our teams, our operations and our financial priorities. I've been impressed by the discipline and focus that drive our performance, and I look forward to building on that momentum. Now turning to our financial results. Our third quarter results were strong, reflecting continued commercial and operational execution. Financially, the year is tracking ahead of our expectations. And based on our performance through the first nine months, we are raising our full-year 2025 guidance today. For the third quarter, we generated total revenues of $394.2 million, driven primarily by our portfolio of proprietary products, which generated net sales of $317.4 million, reflecting 16% year-over-year growth. These results were driven by strong underlying demand, which Todd will address in his remarks, and gross-to-net favorability, primarily related to Medicaid utilization rates, which drove a one-time gross-to-net benefit of approximately $8 million for VIVITROL and approximately $5 million for ARISTADA. As we move into the fourth quarter, we expect Q4 net sales from this portfolio in the range of $300 million to $320 million. Manufacturing and royalty revenues were $76.8 million for the third quarter, including revenues of $35.6 million from VUMERITY and $30.2 million from the long-acting INVEGA products. Turning to expenses. Cost of goods sold were $51.6 million, which compared favorably to $63.1 million for Q3 last year, primarily reflecting efficiencies following the sale of our Athlone-based manufacturing business last year. R&D expenses were $81.7 million compared to $59.9 million for Q3 last year, reflecting investments in the Vibrance Phase II studies of alixorexton across narcolepsy and idiopathic hypersomnia and first-in-human studies and development efforts for our next orexin 2 receptor agonist candidates, ALKS 4510 and ALKS 7290. SG&A expenses were $171.8 million compared to $150.4 million for Q3 last year, reflecting the expansion of our psychiatry field organization earlier this year and promotional activities related to LYBALVI. In Q4, we expect a modest increase in SG&A, primarily reflecting activities related to the Avadel transaction. This performance generated strong profitability of GAAP net income of $82.8 million, EBITDA of $96.9 million and adjusted EBITDA of $121.5 million in the third quarter. As we look ahead, based on our strong commercial performance and momentum through the first nine months of the year, we are on track to deliver record revenues from our portfolio of proprietary products in 2025. As a result, we are raising our 2025 full-year guidance to reflect our current expectations of total revenues of $1.43 billion to $1.49 billion, GAAP net income of $230 million to $250 million, EBITDA of $270 million to $290 million and adjusted EBITDA of $365 million to $385 million. Our full expectations are outlined in the press release issued this morning. Turning to our balance sheet. We ended the quarter in a strong position with $1.14 billion in cash and total investments. For the acquisition of Avadel, we will use cash from our balance sheet in conjunction with bank debt to finance the transaction. As we close the transaction and finalize the financing, we will be in a position to provide more details. Taking a step back, Alkermes is one of the few biopharmaceutical companies that has successfully transitioned into a fully integrated profitable commercial organization with an exciting development pipeline. I stepped into this role at a time when the company is operating from a position of financial strength with a clear growth trajectory and near-term opportunities with the potential to drive meaningful value for shareholders. I'm energized by the opportunity to help shape that next phase of our growth, working closely with the rest of the leadership team to support our strategic priorities and drive long-term value creation. I look forward to engaging with many of you in the weeks ahead and to contributing to the continued success of Alkermes. With that, I will turn the call to Todd for a review of the proprietary portfolio.

Thank you, Joshua, and good morning, everyone. In the first three quarters of the year, we executed with discipline against our targeted growth initiatives. The focus drove strong consistent performance across our three proprietary brands, underscoring the strength of our commercial strategy and our capabilities. We're encouraged by the momentum we've built and remain confident in our ability to carry it forward. In the third quarter, we recorded net sales from our proprietary product portfolio of $317.4 million, reflecting 16% year-over-year growth. We drove strong end market demand across VIVITROL, ARISTADA and LYBALVI. Starting with VIVITROL. Net sales in the third quarter were $121.1 million. VIVITROL performance continued to be driven by growth in the alcohol dependence indication market and our ability to capitalize on highly localized market dynamics in certain states and payer systems. For the full-year 2025, we now expect VIVITROL net sales in the range of $460 million to $470 million compared to our prior expectation of $440 million to $460 million. Turning to our psychiatry franchise. The expansion of our psychiatry sales force earlier this year was a key strategic initiative designed to enhance our competitive share of voice. With our expanded footprint, we have been able to significantly increase the frequency of our call volume for high-priority prescriber targets across LYBALVI and ARISTADA. This increased share of voice, along with strong execution has driven increased breadth of prescribers for both brands. For the ARISTADA product family, in the third quarter, net sales were $98.1 million. Leading indicators related to underlying demand were encouraging with increased prescriber breadth and strong new-to-brand prescriptions during the quarter. For the full-year 2025, we now expect ARISTADA net sales in the range of $360 million to $370 million compared to our prior expectation of $335 million to $355 million. Turning to LYBALVI. Net sales grew 32% year-over-year to $98.2 million. Underlying TRx growth was 25% year-over-year, driven by new patient starts and prescriber breadth. Gross to net adjustments were approximately 28% in the third quarter. For the full year, we now expect LYBALVI net sales in the range of $340 million to $350 million compared to our prior expectation of $320 million to $340 million. Across the portfolio, we are pleased with our performance through the first three quarters of the year and entered the final stretch of the year with strong momentum and a clear focus on delivering against our full year objectives. With that, I will pass the call back to Rich.

Thank you, Todd. Well done. I think you can see from the results that the company is performing well across each of the key aspects of our business. During the quarter, our commercial teams delivered strong operational financial performance, and our R&D teams made major strides in advancing our expanding development pipeline. So I want to make comments about both aspects of the business. First, commercial. We entered the final quarter of the year ahead of plan and with good momentum into year-end. Over many years, we've developed capabilities necessary to operate in challenging payer and policy environments. By design, we manufacture our proprietary products in the United States, and we do not commercialize these products outside the U.S. We are growing our business by growing demand based on the clear clinical attributes of our medicines and maintaining a disciplined contracting strategy consistent with our view of their significant value. Now R&D. Our portfolio of orexin 2 receptor agonists is advancing rapidly, led by alixorexton. The first Phase II data set of alixorexton was presented at World Sleep in September. In the Vibrance-1 study, alixorexton demonstrated compelling therapeutic benefits in patients with narcolepsy type 1 with a profound effect on excessive daytime sleepiness and cataplexy, along with a generally well-tolerated safety profile. Taken together with the clinically meaningful improvements in fatigue and cognitive function demonstrated in the study, we believe alixorexton has the potential to transform the treatment of NT1. At World Sleep, the competitive positioning for alixorexton in NT1 also came clearly into focus. In this large randomized, double-blind, multi-week study, alixorexton administered once daily across a range of doses demonstrated new potential best-in-class features. With data from this rigorous Phase II study now in hand, we're confident in the profile of alixorexton in NT1, and we're moving rapidly to initiate the Phase III registrational program in the first quarter of next year. We expect to be first to market in narcolepsy type 2 and idiopathic hypersomnia. We completed enrollment in Vibrance-2 in patients with narcolepsy type 2 toward the end of the summer, and we expect to report top line data in November. In idiopathic hypersomnia, Vibrance-3 is enrolling well, and we expect data from that study in mid-2026. Like Vibrance-1, these are both large, well-powered Phase II studies designed to provide substantial data sets informing potential Phase III development. We are building a significant body of clinical data that deepens our understanding of orexin biology and its therapeutic potential in central orders of hypersomnolence and beyond. Equally important, the Phase II studies are yielding key learnings related to study design and implementation that we believe will be invaluable for Phase III and help support alixorexton's competitive position in narcolepsy. Beyond alixorexton and sleep disorders, additional candidates from our portfolio of orexin 2 receptor agonists are advancing well. ALKS 4510 is in the clinic and progressing quickly through single and multiple ascending dose studies in healthy volunteers. We expect to complete this Phase I work early next year and move quickly into proof-of-concept studies in the disease areas that we plan to pursue. For ALKS 7290, we have filed the IND and recently initiated our first-in-human study. Across our orexin development programs, we have demonstrated in clinical or preclinical models that orexin 2 receptor agonists may have powerful effects, not only on wakefulness but also across domains related to fatigue, cognition, attention, and mood. We look forward to sharing more on both of these candidates next year as they complete their Phase I healthy volunteer studies. So to wrap up, the third quarter was a clear demonstration of Alkermes' strong execution, commercial momentum, and scientific leadership. We continue to operate from a position of financial strength as we advance our pipeline and generate a growing body of data and insights that inform our strategy and reinforce our conviction in the opportunities ahead. With disciplined focus and a commitment to innovation in the patients we serve, we're well positioned to deliver long-term value for our shareholders. So we look forward to sharing our progress. With that, I'll turn the call back to Sandy to manage the Q&A.

Thanks, Rich. Rob, we'll open the call now for Q&A.

Our first question is from Marc Goodman with Leerink Partners.

Yes. Can you talk about LYBALVI just a little bit? It seems to be a lot stronger than expected and the gross to net seems to be a little lower than expected. We were expecting that to kind of creep up some. Just give us a sense of what's happening with the product and just how you're thinking about gross to nets into the next year?

Yes, absolutely, Marc. This is Todd. Yes, we're really pleased with performance for Q3. As I said in my prepared remarks, expansion of our psychiatry footprint really drove a strong share of voice in the quarter. We were able to significantly increase our call volume, which was our strategic plan. We did that in Q3. We believe that, that momentum will carry into Q4. And so the result of that is we saw year-over-year TRx growth of about 25%. But what's even more encouraging is we saw new patient start year-over-year NBRx has increased almost 16%. So the underlying demand is really encouraging, and we believe that's a really direct reflection of the expansion of our sales force. So for context, breadth of prescribing over the quarter increased 7%. So that's two consecutive quarters, Q2 and Q3, we saw a strong breadth of prescribing. To your question on gross-to-net, gross-to-net was a little bit lower in the quarter than from Q2. That's the result of just as deductible resets throughout the year, lower co-pay utilization, some small little dynamics like that actually had a lower gross-to-net for the quarter.

And Marc, it's Rich. I'll just add and Todd can expand on it. But the story about LYBALVI over time in the marketplace, other than just our strong commercial execution is its efficacy. And that efficacy message is resonating, and I think it's supported now by multiyear data in the real world.

How do we think about gross-to-net into next year?

So we're not going to provide any guidance today, Marc, for next year. We do expect that going into Q4 that the typical seasonal patterns would show up. So we do expect a little bit of expansion of gross-to-net in Q4, but we'll give you a full-year guide in February.

So I just wanted to ask about, I guess, expectations once the NT2 alixorexton data are in hand. How does that inform the next steps with the FDA? And when will we know more about the Phase III program and design? And then maybe just a follow-up on VIVITROL, just kind of the expectations heading into Q4 for that product.

David, it's Rich. I'll take the first, and then Todd can answer on VIVITROL. So we expect that we're on track for data from the NT2 study in November. And as we've said along, when we get those data in hand, that coupled with the Vibrance-1 in NT1 data will comprise the package for our end of Phase II meeting with FDA. So we'll request that meeting as soon as we get the NT2 data. We'll have that meeting and then we'll launch the Phase III program as our expectation early next year. Go ahead, Todd.

Yes. In terms of VIVITROL for the fourth quarter, I think the basis of that is what we saw in Q3. We saw strong AD demand. AD sales continue to drive the substantial majority of the brand. We hear very encouraging feedback from the market from HCPs and patients. So our expectation is that we would continue to see AD growth going to the fourth quarter. I think it's also just important to keep in mind that this is a mature product. So we think it will perform like a mature product, but our focus is really driving AD sales in Q4.

I just wanted to dial in on the NT2 study a little bit. Could you perhaps lay out for us your expectation of how much of an MWT benefit is reasonable to expect, knowing there's a bit of tachyphylaxis off of single-dose work in Phase I. But on the flip side, patients are starting off at 10 to 12 minutes at baseline. So how much MWT improvements are you expecting? And then also any broad parameters around what do you know as of right now on blinded safety for NT2?

Umer, it's Rich, I won't comment on any of the blinded data. We'll get the full data set here just in a matter of weeks. So we'll look at the data in the aggregate in a large multi-week randomized, placebo-controlled study, the blinded information is not particularly useful to us. So we'll look forward to seeing the whole data set right away. Our expectation is that based on the Phase Ib study is that we know that orexin 2 receptor agonists from that study can drive wakefulness in patients with NT2 and NIH. But we really don't have a numerical threshold at the outset because we also expect a lot more variability in the patient population. So from a Phase II perspective, what we're looking for is we've identified a range of doses like we did in the NT1 study. What we'd like to see is the safety tolerability profile across that range of doses and clear evidence of efficacy across the various efficacy parameters, all to inform our dose selection for Phase III. So that's the goal. If we can come out of the NT2 study with clear evidence of safety, tolerability and efficacy and a design for Phase III, we think we're going to be the first to market in NT2. And the same thing applies for IH. And this is the virtue, by the way, of running these large Phase II studies. When you're talking about cohorts of 90 patients or so over multiple weeks. And remember, it's not just the 6-week or 5-week double-blind period or 8-week double-blind period. It's also the extension period where we have dose variability and selection for patients. So between these two phases, we just learned a tremendous amount about patient preference as well as dose response, and that all goes into the calculus for Phase III.

Just to piggyback off that, can you confirm what details you'll give us in the top line release? Will we know the actual effect size? Or are you going to be saving some of this for a medical meeting? And then on the safety point, how are you thinking now looking ahead as to whether you might employ some sort of titration to try to attenuate certain side effects given that in the OLE and the NT1 study, we weren't really seeing much in the way of new onset visual AEs or things like that?

So yes, we have a good sense of how we're going to provide the top line data. You'll see that in the next few weeks. What you learned from the Vibrance-1? Probably, there's a lot of data that comes out of these studies. So what we'll do is as soon as we get the data, we'll start submitting the abstracts for the various medical meetings as they roll into 2026. But you can expect a fair amount of data coming out, but the top line, we have a good sense of the structure of it, and you'll see that in relatively short order. We've made a lot of decisions following Vibrance-1 about the structure of the dosing in Phase III. We're going to keep most of that proprietary right now because we feel like there are some real learnings. Some of them probably you can think through and derives from the comment that you made is that we really saw a very, very low incidence of new-onset adverse events for patients who had already been exposed to alixorexton in the double-blind period. So all that information from Vibrance-1 has been put into our modeling. And I think we've settled on our Phase III design, and you'll see that when the study gets underway.

This is Manoj for Akash. Just two questions. When you release the top line Vibrance-2 data, will you be releasing data points over time like 4 weeks and 8 weeks because both TRK-994 and 861NT2 data showed some deterioration of efficacy, primarily in MWT going from 4 weeks to 8 weeks. Do you see any biological rationale for this? Or is this just like noise related to a small number there? And also, do you expect a dose response in Vibrance-2 in terms of ESS? And also lastly, what kind of PK profile do you look for the next-gen orexin agonist?

Regarding the topic of tachyphylaxis that both you and Umer mentioned, we have not found strong evidence of tachyphylaxis or a decrease in efficacy signal between 4 and 8 weeks or from 8 to 12 weeks in other data sets based on prior information. At this stage, while I may not have all the detailed time course data, I want to clarify that we do not anticipate seeing degradation as part of our initial hypothesis. If there were any signs of degradation, one potential solution would be the use of a range of doses, which we believe could provide a competitive advantage in this area. We hope to observe a dose response across different efficacy measures, but we will need to review the data to confirm this. The three doses we evaluated for NT2 were intended to capture a range of dose responses, but we will need to await the final data set for clarity. Regarding the pharmacokinetic profile of the next orexin agonist, we will not be revealing specific attributes about the upcoming molecules. I wouldn’t necessarily categorize them as next-generation because they don’t directly address deficiencies in alixorexton; rather, they are just different. They are intended for various patient populations and clinical situations, sharing key characteristics of potency and selectivity, which we consider vital for exploring brain circuitry, but they will differ from one another.

Maybe for the NT2 data set, can you talk a little bit about the importance of also showing the benefit on the ESS? Is this important for both the FDA? Or is this more of a European measure? If you can kind of put that into context a little bit? And then for the Phase III programs, can you talk a little bit about your expectation for ocular monitoring on one side of it, I could see that it would be helpful if you do see some early visual disturbances to kind of say that this was not impactful. But obviously, on the flip side, it would probably make the Phase III a little bit more complicated. So kind of your latest thoughts on that would be helpful.

In the NT2 study, we consider both MWT and the Epworth Sleepiness Scale as primary endpoints, each capturing different aspects. MWT provides a numerical assessment of sleep latency, while the ESS reflects patients’ self-reported levels of sleepiness. Both measures are significant. In Phase II, we aim to identify which metrics are most sensitive and reliably respond to different dosages. This includes evaluating cognition, fatigue, narcolepsy severity scale, global impressions, and all other endpoints, as these insights will guide the design and structure of our Phase III trial. While we are looking for signs of efficacy across these parameters, it's premature to make definitive statements about Phase III. In Vibrance-1, we observed generally mild effects, with one moderate case and one severe case of blurred vision. Overall, the treatment was well tolerated, and the comprehensive ophthalmic evaluations conducted on all patients addressed concerns about potential structural issues from using an orexin-2 receptor agonist. Currently, it's unclear if we will need to implement any monitoring in Phase III. We hope the need will be minimal and mild. Ultimately, any decisions will involve discussions with regulatory bodies.

Just a couple of quick ones on the additional orexins that are going into the clinic. I know, Richard, you talked about properties in mood and attention. So is it safe to say that at least one additional disease setting is going to be in a psychiatric setting once you move into proof-of-concept studies next year? Maybe elaborate a little more on how you're thinking about that? And then secondly, I don't know if this has been asked, but any thoughts on alixorexton outside of the United States? And what kind of discussions, if any, have you had with European regulators there?

Yes, we have expressed interest in three main areas for our next candidates: psychiatry, neurology, and certain rare neurodevelopmental or neurodegenerative conditions. We believe that a significant portion of the clinical presentation in these areas includes excessive daytime sleepiness, anhedonia, fatigue, and depressed mood. We won't provide further specifics at this moment. As I mentioned earlier, our aim is to transition into patient-focused studies right after the SAD/MAD phase to obtain early signals. By the end of 2026, I hope that people will see how this program has expanded beyond narcolepsy. The key to this is successfully navigating the SAD/MAD process to establish these candidates as legitimate options for these indications, which is currently in progress. We are very excited about the developments anticipated in 2026. Regarding alixorexton outside the U.S., we are conducting clinical trials in Europe and Asia, where there appears to be a strong demand for this product. Given the current state of pharmaceutical pricing discussions globally, we believe it is safe to say that we do not expect to offer alixorexton to patients outside the U.S. at significantly lower prices than those in the U.S. Our objective is to make this treatment available to patients in both the U.S. and in Europe and Asia.

This is Chi speaking for Jason. I would like to follow up on the earlier comments regarding visual adverse events in the Vibrance-1 trial. From what I understood, most visual adverse events were mild, with one case classified as moderate and one as severe. Could you provide more context on what defines a severe vision blur and the duration of that adverse event? Additionally, is there a dose-response relationship with the visual adverse events observed in Vibrance-1? Reviewing the Vibrance-1 adverse event table, I noticed a severe event at the 4-milligram dose and two severe events at the 8-milligram dose. Could you clarify the dose level for the one moderate visual adverse event and the one severe visual adverse event?

Yes. Most of the visual adverse events reported as blurred vision were mild cases. There was one moderate case that became mild after about four days, and one severe case that contributed to the early termination of that patient after the third day in the study. We observed a dose response, with more cases at the 8-milligram dose compared to the 4 and 6-milligram doses. Interestingly, during the extension period after patients completed the double-blind phase and could choose their dose, those who switched from a previous dose of alixorexton to the 8-milligram dose did not report any new incidents of visual adverse events of blurred vision. This suggests a dose response where the phenomenon is mostly mild, meaning patients notice it but it does not significantly impact them. Most occurrences happened in the first week and were largely transient. We'll also see how the NT2 data set reflects this in the IHs. Overall, as we gather more data, it appears that these treatments are generally well tolerated, with side effects typically being mild to moderate and transient. The most common adverse events observed with these drugs are insomnia and urinary frequency.

That will conclude our question-and-answer session. I'll turn the floor back to management for closing comments.

Thank you, everyone, for joining us on the call today. Please don't hesitate to reach out to us at the company if there are any follow-up questions.

Thank you. This will conclude today's conference. You may disconnect your lines at this time, and have a wonderful day.