Goldman Sachs 47th Annual Global Healthcare Conference

Good afternoon. Welcome to our next session. It is my pleasure to be hosting Exome 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 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, you know, 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, Actome, we are a CNS-focused biopharma. We have three products that are currently on market. With a recent approval for Avelity, this is our product for it targets NMDA and Sigma-1. It was previously approved for a major depressive disorder. It's been on the market for about four 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 two other products, one Simbravo for migraine, and the other is Cenozi 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 three trials, NDA stage, submission programs. So we can run through all 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, But, you know, as you're with the ambition to build a large, large-cap company, is it realistic to only focus in neuroscience, given the high-risk associates in development, or should you also expand into other areas besides neuroscience?

It's a great question. Obviously, we have our annual planning process and quarterly and tactical planning process, and then our long-term strategy process. 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. The industry had really moved away from neuroscience, psychiatry, neurology, and you alluded to a key reason for that, which is studying, you know, 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? At that point in time, due to those, you know, those are a few of the considerations. Industry had moved away, and that's why the company was started, Areo Tabuto, our CEO, he founded the company to work on some of those challenges. And over that, you know, since then, we've gotten really good at building a pipeline of active molecules, designing studies to detect signal, and then taking those programs and 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, you know, at the same time, we're very much data-driven and value-driven. So if there are, you know, programs or opportunities that in the future for some reason or another make 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...

Yeah, and I think maybe just one thing for the last five years, right? Since five years ago, we looked completely different than where we are today, but I would venture to say five years from today into 2031, we will look even that much more different than where we were five years ago. So we had, you know, five 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 three products that we have and now four indications. And you look five years ahead and you take a look at, you know, the story right now is all about Avelity and in ADA as well as MDD, but there is a robust pipeline behind Avelity 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 Axelm 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 Avelity. 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 sale guidance to $8 billion? I think, you know, previously it was lower for the two different indications. Even when you combine it, it was too lower. So what drove that rationale and anything that you want to draw from the label?

Sure, yeah. So I'll start with the label, and then maybe Nick can talk about how that percolated into, you know, the data and our calculations. But the label, so if you start with the product itself, you know, 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. You know, 99% of products that are prescribed for AD agitation are used off-label. Mechanistically, 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, you know, quote-unquote typical longitudinal study where we see very rapid separation in onset of action. So starting at week two, STAT-SIG at week three, carrying through to the end point. So that's 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. 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, you know, 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. 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.

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 one quarter 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. What does that mean? That's just a leading indicator where we expect NTRXs to go. So very nice trajectory, and one thing that we've also seen. And secondly, with our expansion, we expanded from just under 300 reps to just north of 600 reps most recently. And, you know, if you just take a look at since May when these reps have been on board, so since May 1st 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 MD Day.

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, adopter. And so 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 line of therapy it's being written for, 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.

Yeah, 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 that has come in over the line. We haven't spoken about ADA necessarily, but there is 21 million scripts written annually for Alzheimer's disease agitation. And when we looked at our model, we looked at 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 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 payers and so forth. So based on some of the discussion that you guys have been having with payers, I think you guys mentioned availability would be mostly covered under Medicare Part B, and I assume the rest is split between commercial and Medicaid. Okay. 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 availability compared to before ADA? Is that going to change the GTN?

Understood. Yeah. So currently for MDD, so the original indication, our split between, for our scripts was 70% commercial, 15% Medicare, 15% Medicaid. 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 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 with the addition of ADA?

Sure. The main difference between Medicare Part D and commercial coverage is there's no copay assistance, but there's additional rebates as well. So, you know, 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 think, got it.

So you mentioned that the commercial launch is on track for this month and the expansion with the Salesforce 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 activities that you have to or investment you have to put into the commercial launch?

Yeah, 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 functions, 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 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 one to two quarters, but we're seeing that already. That's just detailing efforts around depression. 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 in detail, and that is commencing or beginning to commence in the field 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 where our heli 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 spent 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 two reps that are focused on one geo. The geo is actually smaller, but now we're actually able to see higher decile doctors, so call it, you know, decile six, seven doctors, up to ten, 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 breath, we're getting better depth with each of these doctors, and then from a target list perspective, you know, the team goes out and is prepared to either speak as a, at 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 know, 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 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 Axelm 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 The areas are very different. You have to kind of learn as you go.

May I 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 was a lot of learning that we had as it relates to DTC. 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 potentially think about DTC in 27, 28, where patients can come in and doctors are already aware of it.

to take, you know, and to work backwards. So the first question, when you think about, you know, from a marketing perspective and, you know, targeting, you know, potential consumers, the, you know, MDD and AD agitation, it's very different, right? So MDD, you're working to educate the potential patients themselves or provide, you know, 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 it's very distinct in terms of the patient populations. There are synergies or high overlap in a variety of elements of the two indications. So prescribers, you have high overlap from a prescriber perspective, you know, upwards of three 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 a long-term care setting, there are very high rates of major depressive disorder. And not just comorbid with Alzheimer's agitation, but just in general. And, you know, Nick touched on that, that we had intentionally and historically not had efforts to long-term care facilities. So that's changing. So there's synergy 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 waiting for each team member who may skew a little more heavily towards MDD potential targets or AD agitation potential targets or those who are, you know, potential targets for both. Well, those are a couple 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 primary care and neurologists in the past. How are you guys thinking about here in terms of primary care versus neurologists? And then from an effort perspective, how much are you guys putting into that long-term care facility? Because that's a whole different targeting, too.

You want to touch on long-term care? From a targeting perspective, We're increasing more and more the efforts in primary care, but historically the primary targets and riders have been a component for both MDD and early psychiatrists and primary care. The riders to primary care today makes up a bit north of one-third of the riders, and another way to think about that is it's a little bit adjacent, but as of today, 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, you know, a specialist. And so that, that lines up with primary care and psychiatry. It's true for both indications. It can depend geographically, right? In, in urban centers, you, there are, you know, specialists, psychiatry, neurologists, geriatrics, psychiatrists, they're, they're, they're more ubiquitous, say, than in rural areas where, you know, your primary care doctor is all of the above. So it does depend, and that all translates, and the sales operations team does all of that work, those analyses, and then pulls it through to how the folks actually approach their territories tactically. But that is the main focus in terms of from targets.

Okay, got it. And then I think for MBDU, there's a lot more shift to an earlier line. How do you guys, I mean, in terms of, like, the first line and then the first line switch to availability, 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, that lines of therapy use for ADA?

Yeah, it's been trending nicely. So as Mark mentioned, first line, first switch is 56%. That number has grown in sequential quarters, really, since launch. It's roughly 15% first line. And then our coverage and our strategy. Our strategy is our focus early on was high-decile psychs. 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 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 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 that, but I think the, as Mark mentioned, unrestricted and getting to 100% is the ideal solution. But, you know, the team's working to continue to improve formulary coverage and total covered lives. I see, okay.

And then the XUS, what are the plans there? Is it time to find a partner? How do you guys think about the XUS?

We said outside the U.S., you know, that's an area of interest for us for the programs, and obviously there are high need outside the U.S. from prevalence perspective for all these indications that we're working on. So we've been, you know, focused on the U.S. historically, and we're mindful and, you know, consider different avenues to getting the products to other geographies and patients. And so historically we've considered, you know, potential partnerships, if it makes sense. And, you know, we've done that. There's a partner for Cenose outside the U.S., and we can talk about that. And, you know, the way we approach the programs, though, is, you know, we work on some of the development activities kind of in the background and behind the scenes because there are different regulatory requirements and different geographies. So we kind of chip away or whittle away at those over time while we consider, you know, potential partnerships. And in the meantime, you know, 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 we didn't talk about, the migraine, that's not a 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 Simbravo. Cenozi, 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 and 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, you know, stay tuned for that. And then behind that, there's a whole host and choreography of upcoming clinical trial initiations and readouts, starting with salriamphatol in binge eating disorder later this year. And then we'll keep it going. You know, 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.

Thanks, Richard. Nick, I appreciate it. Thanks for having us. Thank you, Richard. Yeah, thank you so much for a very insightful discussion.

Thank you.