Axsome Therapeutics, Inc. (AXSM) May 19, 2026 Conference Transcript

All right.

Thanks everyone for being here. Happy to have our first session after our keynote and lunch here with Axone. I'm represented by Mark Jacobson and Nick Fizzi. So thanks for being here.

Thanks for having us. Yeah, we're happy to be here. Thanks, Leo.

Great. So a lot of exciting developments lately with the company. So there's a lot to talk about, but maybe we can start off with the approval in Alzheimer's agitation that recently came through. Maybe just by way of introduction, you can sort of remind us of the differentiation the drug offers and maybe weaving in now that you have a label, sort of how that met or exceeded your expectations and how you're feeling about that going forward.

Yeah, hi, everyone. We feel great about it. So the label, so that was approved just over two weeks ago by FDA, breakthrough therapy designation, priority review. We're very, very happy with the label. It's very clean and is a differentiated product profile. So that starts with the mechanism of the product, targets NMDA and Sigma-1, And that results in a profile, which is in the label of rapid onset of action in terms of separation from placebo, which starts at two weeks and carries forward through data that demonstrates duration of treatment, durability of treatment effect. and that if you remove, this is through the randomized withdrawal trial, the ACCORD-2 trial, if you remove treatment, then you see high rates of relapse of agitation symptoms. Then we see a differentiated safety and tolerability profile, wherein there's not a box warning for the indication. We did not see a mortality signal. We did not see a false signal. You do not see sedation, or we did not see sedation. And then, of course, if you look in the adverse reactions section of the label, it's very, very clean, and that ties to, again, the mechanism and the clinical data that we generated. So we're very pleased with the label and what that means in terms of how we can deliver a new treatment option to patients and HCPs and then associate it with that, the potential market opportunity.

Got it. So I guess with that in mind, can you talk about how you're positioning for the launch? Obviously, the drug's not going to be commercially available until June. You guys have talked about that. But there must be work that you're doing behind the scenes with the sales force. So can you just talk about how that's been going, so the progress that's been made to get yourselves ready for that formal launch?

Sure. And one interesting thing about this is it's a validity, so the the product is on the market already for the initial indication of major depressive disorder. And it's, it's the same, um, you know, it's, it's the same maintenance dose. So the, what's really happening right now between now and when we said we'd launch in June are, uh, educating the, and training the, the sales team and, you know, updating. So updating the core visual aid and, and marketing materials, Some other discussions ongoing and have been ongoing with respect to setup and preparedness and long-term care, payer discussions. So that's all moving along, but the rate-limiting step until quote-unquote launch is marketing materials and training the sales team on the indication in the label. yeah um what have you been hearing from physicians caregivers for excitement for their interest in using this um i guess as we start thinking about what the shape of that launch could be you know how does you know interest in the drug plane and how we should be thinking about our model sure the um the feedback we've received and you know is there's there's high excitement for a new treatment option obviously it's it's um a significant unmet medical need underserved there are over 20 million scripts about 21 million scripts uh a year and and um until recently there you know until until this approval there was only one previously approved product so just in in in the majority you know 99 of the scripts that i mentioned are are off-label pharmacotherapies due to the dearth of approved products in the indication. And clinicians, so we were joined on the approval call by Dr. Jeffrey Cummings. So feedback from Dr. Cummings and other KOLs is that we touched on some of the elements of the label, but that the label and the product profile are exciting in terms of addressing the treatment need. One, just additional therapies. Two, a new mechanism of action and product profile efficacy and tolerability profile that are distinct from what has previously been used, both on and off label. And so there's interest in the product as a potentially first-line agent and beyond due to that, you know, the risk benefit or, you know, the safety and efficacy profile that we've covered.

Yeah, and in line with the approval, additionally, completely independently, but the FDA put out a press release as well as the Alzheimer's Association, you know, sharing their thoughts on ability.

So you mentioned long-term care. Can you talk a little bit about where these patients are that you'll be targeting, how much overlap there might be with the existing prescriber base, any other work that you'd need to do to sort of minimize any friction to the new areas that you're pursuing?

The current split in Scripps is about 60% in community setting and about 40% in long-term care. And we will, so historically for Ovality, the Ovality sales team has only detailed and educated in a community setting before. We have not actively educated or engaged in the long-term care setting. We will be doing that now. Earlier this year, we announced an expansion in the sales team. And the availability sales team, which will be detailing and educating around both indications, it's going to be about 630 reps. And a small percent of that will be exclusively focused on long-term care. In the community setting, about 80% of targets overlap for both indications. And in long-term care, 50 to upwards of 75% of individuals have depression in long-term care settings. So there's high overlap in both indications in long-term care as well. And as I mentioned, we have not actively educated and detailed in long-term care before. So there is high overlap and high synergy with both indications.

And just to kind of double down on what Mark shared, we have not called on any LTC centers to date, and significant prevalence in MDD within these LTCs and comorbidity between ADA and LTC. And if you take a look back, you can go back to when Lexapro was launching in LTCs back in the late aughts, and you can see that their sales in LTC in MDD alone were around $500 million, and that was about a $200 whack. So you kind of can use that as a potential in LTC alone, in MDD alone. I know a lot of the focus is on ADA, but there is a significant potential for MDD in LTCs.

The other aspect of this is payer dynamics, and I've talked a lot about that, particularly on how discounting may evolve or actually improve. So can you just remind us what the balance is of how we should think about, you know, potentially more public pay patients, if anything is going to evolve in the commercial side of the payer equation?

Sure. So for ADA, we would anticipate at least 80% of total scripts to be in Medicare Part D channel, and of which we have 100% total covered lives. So 100% covered lives within Part D, of which we anticipate 75% would not have any PA and would be either unrestricted or first step or one step. And then the other 25% would likely have a PA, but really a PA to indication, so not an overburdensome PA or a medical exception, just a PA to indication with a minimum of a single step. So we feel coming out of the gate with a launch in ADA, you know, access is fairly accessible. And also, again, it's not just for ADA. That will also be for the MDD patients.

Another way to say that is net-net, in the majority of cases, if a script is written more often than not, and substantially more often than not, it should be filled.

And thinking about what we did in 2022 when we launched in MDD, we obviously had payer access was a bit of a hurdle. I think we launched in MDD with roughly 40% commercial lives. So that was where the bulk of the scripts were on the commercial channel. And we're obviously able to get to that. That number is now total covered lives is 86% for Abelity.

Maybe one more on this topic. Obviously, there's a branded antipsychotic in the market that launched a few years ago. What should we take away from that launch? what they did well, what maybe you could do better, and really how Avelity is ultimately going to be positioned against antipsychotics if it's going to be earlier or switching, I guess how comparable that launch even is as we think about comparables.

So the one other branded agent is, it's informative, but it's distinct. So, you know, they've been, the Rex Proposal, Rex Salty, it has been growing since launch, especially in the Medicare Part D channel. And so we watch that. We have given the profile and kind of just our commercial infrastructure and approach and current state of affairs. We it's helpful in terms of there has been active promotion and education on patient profiles and and diagnosis that that's all great. It's great for patients and it's informative to us. But I think we'll be we'll be charting our own course. And Nick touched on access, and not only is the number of covered lives important, but also the quality of that coverage is such that it would facilitate early line utilization and potential first line utilization that we touched on with KOL perspectives and their thoughts on how they might use the product. So that aligns very nicely with today's state of affairs with formulary placement and quality of coverage. So, you know, again, the sales and commercial teams, they always like to learn from others and what's happening in the marketplace. But, again, we'll be focused on educating around the product profile and, you know, potential appropriate patients. We'll go from there. But we, you know, as mentioned, the market is so large, it's not a zero-sum game. There's multiple products. That's a great thing for patients, and, you know, we'll see how it goes. But we're excited.

Got it. I want to touch on MDD, and you guys have talked about how long-term care can expand the MDD opportunity as well. But sort of in the existing business for MDD, I mean, how should we think about the growth that's left there, and a continued uptake in earlier lines in the community? Should there be a halo effect? Is the broader Salesforce expansion going to help that, or is it more steady as she goes?

I think the focus is really on primary care now that we're expanding from somewhere in the neighborhood of 300 reps, a little less than 300 reps, to 630. That is, as of today, we're around 22 basis points of the total antidepressant market. If you take a look back a year, beginning of 2025, We were at 0.15%, so increasing market share by 50% over from the beginning of January 25 to today. And that's with the team of roughly, call it 300 reps now that we are further expanding. We're able to get more in primary care, so have better reach, better breath. But more importantly, as importantly, is have better depth with our higher decile doctors. Secondly, there's been minimal investment on our marketing and advertising spend. We did have a pretty robust spend in Q4. That was the first time that we ventured in direct-to-consumer advertising. We learned a lot from there. We're going to refine that. But when you have 630 reps out there, the investment that you have in DTC will be multiplied. It will have a higher multiplier impact because you have more reps speaking to the doctors and making them aware. so that when patients do come in and ask for the product, they're aware. And then thirdly is payer access. So we had a nice evolution and improvement of our payer access in the back half of last year. We haven't even enjoyed that for a full year yet, but now that we are 78% commercial lives, 86% total covered lives, and as I mentioned, 100% of government channel, You know, we feel like, and 56% being first line or first switch, we feel like we're in a really good spot to further drive to peak sales. And, you know, as we've shared, the peak sales for Availity in totality is $8 billion plus.

So the first line, first switch, so how the product is currently being utilized, that ties to growth and adoption in primary care. With the very lean sales team that we've had, which was by design, it's been highly productive, and so right now about a third of scripts are written by primary care HCPs, and so there's just so much work to be done, and that ties to – it's really a confluence of access where it is, now multiple indications, adoption that we've seen to date, and then the investment that we're making in the sales team in particular, Nick touched on, marketing efforts. But that all comes together where we expect to be able to drive material continued growth.

You mentioned that $8 billion number. I guess if you were to think about that and say there's one part of that number that's really a pivot point or a critical aspect of that that could make it more than $8 billion, could make it less than $8 billion. What do you think is underpinning any potential variability or confidence in that $8 billion number?

It's an interesting question. It ties to the confluence that I just mentioned. The label is very clean, and why is it clean? The product profile is really compelling in both indications. In MDD, it's rapid acting, and that's in the label, so it works very quickly, it's sustained, you see different rates of adverse reactions, in particular sexual dysfunction and weight gain that you see historically, so the adoption is there. And, again, we're educating much more broadly than we have been historically. So that comes together, AD agitation. It's very similar, obviously a different patient population, but efficacy and tolerability profile, it's very, very distinct, and we think very exciting as a new treatment option for that patient population. So there will, of course, be variability, And, you know, we think the growth curve, we feel very good about that. Maybe the variability comes from quarter to quarter. You know, what seasonality do you see what's happening in the marketplace? But I don't think there's one keystone consideration that everything hinges on or only works if that is in place, right? But it really is all those elements we touched on, access, investment, the product profile, they're all very robust. And that's why we see a very robust opportunity.

Yeah, we've got a few minutes left, and there's a lot more to the Axon business that makes it really exciting. So I want to touch on some of those.

You've got another launch that's been in progress in Bravo, in Migraine, somewhat of a different market, you know waiting for you know refills to start pulling through you talk about some of the progress you've made there and I think some initiatives on the sales side yeah I say I think the the biggest progress that we made thus far as we well first q4 to q1 we had nice sales growth we had nice script growth of 36 percent quarter over quarter and importantly we had a nice payer access win so we're able to increase covered lives now to roughly 57 percent so we're still in the early stages of negotiations with with with payers but with that we feel like once we are able to get to a higher level with payer coverage that will really start unlocking the sales improve GTN but with this most recent win we announced that we're actually increasing the team from 100 to 150 so similar story similar playbook to what we did with Avelity when we launched Avelity you know big indication we launched it with 160 reps here with Simbravo we also launched it with a small amount of reps of 100 and growing of growing Simbravo as access comes on as doctors are becoming more aware of it and just being mindful of the investment yeah and if you step

back, the genesis of that product was to offer differentiated efficacy to patients. The overwhelmingly consistent need cited by patients and HCPs is better efficacy. And so we sought out to design a product that delivered very robust efficacy, and we did that. And then now that the product's But on the market, it's still under, you know, it's still within the first year of launch. And that's the feedback we're getting from prescribers, from KOLs and clinicians, is that the product works really well. And so that's fantastic. And we're seeing that the real-world use matches the clinical data. And then what Nick's touching on is, you know, and you mentioned this, is a little bit of a different market than depression. It's a very different market than depression. And so we're navigating that now, and we like what we're seeing. But we'll do what we always do for everything, which is make data-driven decisions where we think the investment has high ROI potential, and that's how we'll continue to execute and invest in the brand and continue to drive growth over time.

I also wanted to touch on sort of the work you've been doing in the wakefulness and sleep market. You guys have Synose, which you're actively commercializing. Also, AXS-12 NDA has been submitted in cataplexy. I guess, how do you think about, in general terms, how Axon is going to play in that market with multiple products, what you're hoping to achieve there, how they might work together?

Sure. So the product that we have on market now in sleep, that's Senozi for excessive daytime sleepiness in obstructive sleep apnea and narcolepsy. The ACEs-12, we've submitted the NDA for cataplexy and narcolepsy, as you noted, so next update there is an FDA acceptance decision on the package. And if that's accepted for review and if it's ultimately approved, then that sets up a very interesting and compelling opportunity in that we already have all of the commercial infrastructure in place for detailing and educating in sleep. and to sleep HCPs that see patients with narcolepsy and write in narcolepsy. And so the infrastructure is there. So if the product is approved, it is a very, very seamless addition to that infrastructure, and the products are distinct. So you don't, and what they treat, right, is distinct. So those are solely for excessive daytime sleepiness. AXS-12, that is for cataplexy, and we see really the whole product profile that was interesting for cataplexy, we do see improvements in sleep, we see improvements in cognition, and if the product is ultimately approved, what is the label to be determined from the starting place are complementary, and we'll have an update in the not-too-distant future about the acceptance decision, and then we'll go from there. But it's a very, very nice setup from an infrastructure and investment perspective.

Got it. You guys have done a really successful job building a Velody into a franchise with multiple wings. And my word's not yours, but it looks like you may be trying to do that with Sinossi as well. You have a lot of different trials you're exploring. We're going to get maybe a readout later this year in binge eating along with some others later. So I guess how should we think about at least the first step of that? You know, what should we expect for binge eating? You know, we've got 30 seconds, but maybe, you know, how do we set that up?

So binge eating, phase three trial ongoing, one of two potential studies is our expectation. So if that's a positive study, that would lead us to the additional work that we've aligned with FDA on to complete a package and get that submitted for review. So stay tuned, but we're looking forward to the readout and that study later this year. But then if you just very quickly back up a little bit more on Senozi, we have four different development programs ongoing, which we think are very exciting. And the reason for that is the product profile overall, clinician feedback about that aging, global changes that clinicians see when using the product in CNS and, you know, neuropsychiatry. So another program that is already partway through phase three development, that's ADHD. So we have the adult ADHD phase three trial that was completed, positive. We have two trials that we'll conduct in parallel in children and adolescents. We said we're launching those very soon in the second quarter, so stay tuned there. And then the results of those trials will then inform if we can submit an NDA for that indication, too. And so that's only two of the four ongoing programs. The other is in shift work and MD, so major depressive disorder, in patients with excessive daytime sleepiness symptoms. So very excited on that, and we'll keep you posted on all those activities.

Unfortunately, that's all the time we have. There's a few programs we didn't get to touch on. But, you know, we'll look forward to hearing from updates on those as well. But thank you.

Thanks for having us. Appreciate it. Have a great day.