Hello and welcome to the Jazz Pharmaceuticals Full Year and Fourth Quarter 2020 Financial Results Earnings Conference Call. Following an introduction from the company, we will open the call to questions. I will now turn the call over to Andrea Flynn, Head of Investor Relations at Jazz Pharmaceuticals. You may begin.

Thank you. And thanks everyone joining the call. Today we reported our fourth quarter and full year 2020 financial results and provided our financial guidance for 2021. The press release and the slide presentation accompanying this call are available on the Investors section of our website. On the call today are Bruce Cozadd, CEO; Renée Galá, CFO; Dan Swisher, President; and Rob Iannone, Executive Vice President, R&D and Chief Medical Officer. Joining the Q&A are Kim Sablich, Executive Vice President, General Manager of North America; Phil Jochelson, Neuroscience Therapeutic Head; Anne Borgman, Hematology and Oncology Therapeutic Head; Sam Pearce, Senior Vice President, Europe and International, and Shawn Mindus, Senior Vice President, Strategy and Finance. I’d like to remind you that today’s call includes forward-looking statements, such as those related to our future financial and operating results, which involve risks and uncertainties that could cause actual events, performance, and results to differ materially. We encourage you to review the statements contained in today’s press release and our latest SEC disclosure documents, which identify certain factors that may cause the company’s actual results to differ materially from those projected. We undertake no duty or obligation to update our forward-looking statements. On this call, we discuss non-GAAP financial measures. Reconciliation of GAAP to non-GAAP financial measures discussed on this call are included in today’s press release and slide presentation available on our website. This communication is not intended to constitute an offer to buy or sell, or the solicitation of any offer to buy any securities, or solicitation of any vote or approval. GW intends to file a proxy statement with the SEC regarding the proposed transaction that will be mailed to GW shareholders. You should review materials filed with the SEC carefully, as they will include important information regarding the proposed transaction, including information about Jazz and GW, their respective directors, executive officers and certain other members of management and employees who may be deemed to be participants in the solicitation of proxies from GW Pharmaceuticals security holders, in connection with the proposed transaction. Please also review slides two through five of today's presentation for other important information, including where you can find more information on the proposed transaction, and on the directors and executive officers of Jazz and GW. With that, I'll now turn the call over to Bruce.

Thanks, Andrea. Good afternoon, everyone, and thank you for joining us today. 2020 was an exceptionally productive year for Jazz, driven by the expertise, commitment, and capabilities of our organization, and defined by operational excellence across commercial and R&D. We entered 2021 in a position of strength. We plan to execute on significant milestones that we expect will further enhance the growth and durability of our business, and to accelerate our transformation as an innovative biopharma company. I'm very proud that from this position of strength and readiness, we announced earlier this month that we signed a definitive agreement for the acquisition of GW Pharmaceuticals. We're excited about the potential to add epilepsies, a third high-growth commercial franchise, to our business, with Epidiolex, a potential near-term blockbuster, as well as GW’s robust neuroscience pipeline. The combined company would be a leader in neuroscience, with a global commercial and operational footprint, and we expect this transaction to deliver substantial shareholder value. We are excited to be joining two companies with a shared culture, built around the same mission, innovating to transform the lives of patients. In 2020, we demonstrated the resilience of our business and our innovation and execution capabilities across the company despite the pandemic. We launched important new treatment options for patients, including Zepzelca and Xywav in the US and Sunosi in Europe, delivered robust revenue growth, and generated significant value for shareholders, successfully advanced early and late-stage clinical trials, and added multiple new innovative products and targets to our expanding pipeline. Our R&D organization initiated regulatory submissions to FDA for JZP-458 in acute lymphoblastic leukemia under the real-time oncology review in December, and completed the rolling supplemental NDA submission for JZP-258 in idiopathic hypersomnia this month, which positions us for two more potential product launches in 2021. Last year, we also continued the expansion of our innovative oncology and neuroscience pipeline through internal and external collaborations with a focus on highly differentiated products that are durable and can be effectively commercialized, positioning us to transform patient lives and continue to deliver long-term growth. Highlights of our successful execution on key 2020 objectives include the successful launch of Zepzelca in the US in July 2020 just six months after we acquired US licensing rights. The launch of Xywav in November 2020, the treatment of cataplexy and excessive daytime sleepiness in narcolepsy. I couldn't be more pleased with our early progress on this launch. The initiation of the European rolling launch for Sunosi in May 2020, the initiation of a new drug submission for Zepzelca in Canada in December, the announcement of compelling topline results in the JZP-258 phase three study in idiopathic hypersomnia in October 2020, followed by the completion of the rolling supplemental NDA submission to FDA in February 2021, positioning us for a potential launch in the fourth quarter of this year. The initiation of the BLA submission to FDA for JZP-458 in ALL, in December 2020, with a potential launch in mid-2021 and deployment of capital through multiple corporate development deals to grow and diversify revenues with innovative new early to late-stage product candidates, such as JZP-150 for post-traumatic stress syndrome and Zepzelca for the treatment of small cell lung cancer. As we think about our key objectives for 2021, we are excited about the potential GW transaction and maintaining the significant momentum of GW's Epidiolex and our Xywav and Zepzelca launches. We also remain on track to execute and deliver on two more important product approvals and launches in 2021 with JZP-468 in ALL and JZP-258 in idiopathic hypersomnia, while strategically diversifying our pipeline and revenues. As a reminder, both JZP-458 and JZP-258 are products we've taken from concept to commercial readiness underscoring the strength of our portfolio and development capabilities. Finally, the foundation we have built across our operations has resulted in a highly productive period of consistent execution and robust financial results and has prepared us for this transformative transaction. I'll now turn the call over to Dan to give an overview of our commercial performance, after which Rob will provide an update on progress across our R&D programs, before Renée closes out with a financial overview. Over to you, Dan.

Thanks, Bruce. I'm also very excited about the progress of the launches of Zepzelca and Xywav in the U.S. and Sunosi in Europe. The strong execution across our commercial, R&D and operating teams during the pandemic continued to demonstrate our resilience and our agility to advance key corporate priorities while fully supporting our customers and our patients. We're also excited about the prospect of two U.S. product launches in 2021: JZP-458 in ALL and JZP-258 in idiopathic hypersomnia. Now starting with Xyrem and Xywav. The successful initial launch of Xywav in November last year, which is the first asset we have taken from concept to approval and onto the market, demonstrates our execution excellence across our R&D and commercial teams. Beginning now with the fourth quarter 2020 results, we will be providing you with metrics around the combined oxybate franchise, including Xyrem and Xywav. In addition, we will provide you with a number of patients adopting Xywav therapy. This information is intended to help you understand the growth and the durability of our entire oxybate franchise. In the fourth quarter, oxybate net product sales were $455 million, 4% higher than the same period in 2019. For the full year 2020, oxybate net product sales were $1.76 billion, an increase of 7% over 2019. Total oxybate revenue bottle volume growth was 2% for the quarter and 4% for the year compared to the same periods in the prior year. Through the fourth quarter, despite the ongoing negative impact of COVID-19 on new patient diagnoses and enrollment, average active oxybate patients increased to 15,300, a 2% increase over the same period last year. We are pleased that our initial Xywav launch efforts have resonated well with both HCPs and patients. In the first two months of launch, Xywav generated net product sales of $15 million, and we ended 2020 with approximately 1,900 active Xywav patients. We are confident that Xywav will become the preferred oxybate therapy over time through strong adoption by existing Xyrem patients while also reaching patients who have been unable to take Xyrem due to sodium sensitivity and expanding opportunities with our planned fourth quarter launch this year in idiopathic hypersomnia, which would be the first FDA-approved treatment for this serious hypersomnolence disorder. We remain on track for broad commercial payer coverage of Xywav within the first six to nine months of launch. We've entered into agreements that provide coverage for two of the three largest PBMs in the U.S., with total commercial coverage now exceeding 60% of lives. We continued discussions with other major payers and PBMs. So while we continue to secure additional commercial payer coverage, we do have robust patient access programs in place to help reduce barriers to access or initiation of Xywav treatment. Our market research indicates that the significant majority of HCPs recognize the ease associated with transitioning patients over to Xywav. In November and December, our field sales team engaged with the large majority of the top HCP prescribers and, in December, we also started our direct-to-patient education, most notably with Xywav leaflets added to all Xyrem shipments. We also have begun our Xywav webinar series and have had significant interest in both our KOL led HCP and patient education programs. So we look forward to continuing the strong launch of Xywav, a very important step forward in oxybate treatment for narcolepsy patients to support their total health and well-being. Additionally, we are excited to be preparing for the planned JZP-258 launch in IH in the fourth quarter this year and the opportunity for continued growth of our oxybate franchise. We are confident in, and we are on track for our goal of having the majority of all oxybate patients benefit from Xywav treatment in 2023. We set this goal taking into account that patients may have multiple oxybate treatment options to choose from in that timeframe. We believe that as we educate patients and physicians on the lifelong impact of high sodium intake, Xywav will be the oxybate therapy of choice. So before I turn to Sunosi, I'd also like to mention that we are currently expanding and realigning our neuroscience sales force into two teams to focus exclusively on either Xywav or Sunosi, allowing us to provide dedicated product support and invest in the unique growth opportunities ahead for each product. For Xywav, we will continue our outreach to the top narcolepsy prescribers with a dedicated sales force and reimbursement team to support the adoption of Xywav as a preferred oxybate treatment. And for Sunosi, we will continue to increase our reach and frequency of calls among the top OSA treating physicians with the goal of driving significant awareness and uptake among these prescribers. So now turning to Sunosi. During the fourth quarter, Sunosi net product sales were $9 million approximately in line with third quarter, with full-year net revenue for 2020 at $28 million. Prescriptions in the fourth quarter increased 9% in the U.S. compared to the third quarter of 2020 and COVID-19 disproportionately affected our Sunosi launch, impairing our ability to build new relationships, especially with pulmonologists, the main OSA treating group who were also at the forefront in the initial battle against the pandemic. As we move into 2021, we're excited about the investments we're making in Sunosi, with our expanded and dedicated sales force and our recent initiation of our TV DTC campaign. We remain focused on driving the next phase of Sunosi growth, which will build on our broad commercial payer coverage at over 90%, the positive feedback and perception of Sunosi among existing prescribers and the large opportunity of undertreatment of excessive daytime sleepiness in the OSA patient population. And lastly, we're pleased with the progression of our rolling launches in Europe, including the encouraging use of Sunosi in Germany for narcolepsy, which is ahead of our OSA launch expected later this year. Turning now to Zepzelca. We were pleased with our fourth-quarter Zepzelca net product sales of $53 million, and this is just the second quarter of product launch, an increase of $16 million over Q3. We continue to see significant patient growth and uptake across the community and the academic settings with use in the second-line setting in both platinum-sensitive and platinum-resistant patients. Our education and promotional campaigns remain focused toward the top small cell lung cancer treating physicians. We are seeing considerable interest, positive feedback, and increased awareness across the academic and community cancer centers, reflecting the significant unmet need, as well as the favorable Zepzelca product profile. So, thanks to our team's outstanding execution. This launch continues to exceed expectations. We were pleased in the U.S. that hematopoietic stem cell transplants rebounded through the third quarter and into the fourth quarter, and we also observed robust growth in Europe, where our field teams have shared that physicians in select regions are treating the serious complications of bone marrow transplants, including VOD, earlier in order to minimize the risk of patients having to go to ICU. This resulted in fourth quarter Defitelio net product sales of $55 million, 16% higher than the same period in 2019. 2020 Defitelio net product sales were $196 million, an increase of 13% over 2019. While intensive therapies have been affected by COVID, and the entrance of new therapies, we continue to believe in the growth opportunity for Vyxeos, both in terms of our ongoing development activities and continued expansion into new markets internationally, as well as our ability to return to in-person promotional activity and continuation of our education on the importance of this clinically meaningful improvements seen, as highlighted in the recently presented five-year survival data from the pivotal study. In the fourth quarter, Vyxeos net product sales were $31 million, 2% below the same period in 2019. 2020 Vyxeos net product sales were $121 million, approximately in line with 2019. So turning now to asparaginase. In the fourth quarter, Erwinaze net product sales were $57 million, 3% above the same period in 2019. 2020 Erwinaze net product sales were $147 million or 17% below 2019. Our agreement with PBL terminated at the end of 2020 and we have the right to sell certain Erwinaze inventory post termination, and we expect to distribute this inventory during the first half of this year. Given the urgent need for a reliable and high-quality recombinant asparaginase, we remain focused on bringing JZP-458 to market as quickly as possible. Our commercial team is currently preparing for U.S. launch, which is targeted for mid-year. In summary, I'm extremely pleased with our overall fourth quarter and 2020 performance. Last year was highly productive for Jazz. We clearly demonstrated our expanded capabilities and the ability to execute across our operating teams. Highlights include the successful launches of both Zepzelca and Xywav. I'm proud of the agility and resilience our teams have shown to support the programs, the products and patients throughout this very challenging past year. We look forward to continuing to execute and meaningfully advance our pipeline and commercial programs through 2021, with a particular focus on our ongoing launches and following FDA approval of our two planned launches for JZP-258 and JZP-458. I'm now going to turn the call over to Rob for an update on our development programs. Rob?

Thank you, Dan. In the fourth quarter, we continued to make significant progress across R&D, including initiating the BLA submission of JZP-458 under real-time oncology review for patients with acute lymphoblastic leukemia and lymphoblastic lymphoma, initiating the rolling submission, sNDA submission of JZP-258 in patients with idiopathic hypersomnia in December, with completion of this submission this month. We have also continued our efforts in geographic expansion for key products, including Defitelio, Vyxeos, Sunosi, and Zepzelca. I'll start with an update on the progress in our neuroscience portfolio. Starting with JZP-258, we are looking forward to the presentation of our Phase 3 study results in adult patients with idiopathic hypersomnia at an upcoming medical conference in the second quarter of 2021. We're excited by the compelling study results we observed and look forward to sharing this data. Under Fast Track designation, we prioritized the rapid initiation and completion of the rolling sNDA submission to FDA within approximately four months of announcing our topline data. As we work to bring JZP-258 to patients with IH as soon as possible, a debilitating disorder, for which there are no approved treatment options. Turning to JZP-385, for the treatment of patients with essential tremor, a progressive, irreversible, and chronic debilitating disorder that profoundly impacts quality of life. In 2020, we completed our healthy volunteer study and we anticipate initiating our Phase 2b trial in mid-2021. Moving now to JZP-150, an irreversible FAAH inhibitor, which we are initially investigating in post-traumatic stress disorder. We plan to initiate our Phase 2 study in late 2021. I'm excited to get both JZP-150 and JZP-385 into important clinical trials this year and move a step closer to helping these patients suffer significant impacts to their quality of life and who have limited treatment options. Now, turning to our oncology development programs and starting with Zepzelca. We are continuing to work on the development program for Zepzelca in collaboration with PharmaMar to support robust data generation in combination with other therapies in small cell lung cancer as well as in other tumor types. We are working toward the 2021 initiation of a Phase 3 study, evaluating immunotherapy plus lurbinectedin as maintenance therapy compared to immunotherapy alone in patients with extensive stage small cell lung cancer after induction chemotherapy. Following the results of the ATLANTIS study, we and our partner, PharmaMar, met with the FDA and shared the topline results. We and PharmaMar agreed that ATLANTIS would not serve as the confirmatory study and are actively engaging with the FDA to determine the required confirmatory study package. We're also working with PharmaMar to continue evidence generation on Zepzelca. We anticipate initiating a Phase IV study with Zepzelca in mid-2021 with an objective to provide additional data and information on treatment practices, patient characteristics, and real-world efficacy and safety. Finally, we submitted the new drug application to Health Canada in December 2020. Now, moving to JZP-458, our recombinant urine asparaginase for the treatment of patients with ALL and LBL who have hypersensitivity to E. coli-derived asparaginase. In December, we initiated the BLA submission to FDA under real-time oncology review. We are on track and working closely with the FDA to complete the BLA submission and remain focused on bringing JZP-458 to patients as quickly as possible. We are targeting a mid-2021 launch in the U.S. We are also working on our regulatory strategy in Europe and Canada and working with our partner on the approach in Japan. We anticipate the data from our current development program for JZP-458 will support our efforts to seek approval in Europe and Canada, and we will be confirming these plans with regulators later in the year. Turning now to Vyxeos. We have submitted data to health authorities in the U.S. and in Europe for Vyxeos in relapsed/refractory pediatric AML. We anticipate a potential approval in Europe and a label update in the U.S. in 2021.

Thanks, Rob. I'm very pleased to share our financial results for the fourth quarter and full year 2020, which reflect considerable top-line revenue growth, including a meaningful contribution from our recent launch of Zepzelca. With our strong financial and operational performance in 2020 and our planned acquisition of GW Pharma in the second quarter of 2021, we are poised for substantial future growth. In addition, the transaction will accelerate and enhance our revenue diversification goal, positioning us to deliver more than 65% of our total 2022 revenues from products launched or acquired since 2019. 2020 was a great year for Jazz. Total revenues for the fourth quarter increased 14% to $666 million and for the full year increased 9% to $2.36 billion over the same period last year. Our full-year 2020 revenue growth was driven by robust double-digit growth in our oncology portfolio and high single-digit growth in our neuroscience portfolio. Neuroscience net sales for the fourth quarter increased 6% to $463 million, and full-year revenues increased 8% to $1.79 billion compared to the same periods in 2019. Full-year 2020 growth in neuroscience was driven by continued notable performance of Xyrem, despite the pandemic, growth of Sunosi prescriptions, and the initial launch of Xywav in November. Oncology net sales for the fourth quarter of 2020 increased 46% to $196 million and for the full year increased 18% to $554 million compared to the same periods in 2019. 2020 oncology sales growth was driven by the robust launch of Zepzelca in July 2020, which generated net sales of $90 million in its first two quarters on the market and the continued growth of Defitelio, partially offset by the decrease of Erwinaze sales due to ongoing supply disruptions. Turning to operating expenses, as we move through 2020 and assessed the impact of the pandemic, we balanced our investments in the business and focused on key value drivers. Our 2020 adjusted SG&A expense was 33% of total revenues, an increase compared to 2019 of 2 percentage points or $112 million, driven by targeted investments to support our multiple new and planned 2021 commercial launches. We increased our 2020 adjusted R&D expense by $32 million compared to 2019 as we expanded our robust and productive R&D pipeline with new innovative product candidates and targets. As a ratio of total revenues, spend was in line with 2019 at approximately 13%. We are pleased with the business progress made in 2020, as a result of our disciplined approach to capital allocation and strong operational and financial performance, and we remain excited about the opportunity to deliver continued growth through our innovative and expanding neuroscience and oncology portfolios in the future. Turning to guidance. For our 2021 guidance, I'll provide Jazz's standalone guidance, and we will update this to include the previously announced GW transaction after it closes. Starting with top-line financial guidance, our total revenue guidance is in the range of $2.55 billion to $2.7 billion, which represents a double-digit 11% increase at the midpoint over our 2020 total revenues. In Neuroscience, we are providing net sales guidance in a range of $1.785 million to $1.885 billion, which reflects an increase of 3% at the midpoint of the range compared to 2020 and reflects our expectations of the robust adoption of Xywav and for 2021 Sunosi performance supported by our investments to accelerate growth and adoption of both products. With regards to Xywav, as mentioned previously, we are pleased with the strong initial adoption. As we work towards broad payer coverage over the first 6 to 9 months post-launch, our investment in patient access and bridging programs is helping to enable seamless access to Xywav by patients. The temporary impacts of these programs, which are important to the long-term durability and growth of the oxybate franchise, are reflected in our 2021 neuroscience guidance. For our Oncology portfolio, we are providing 2021 net sales guidance in a range of $715 million to $835 million, which represents an increase of 40% or $221 million at the midpoint compared to 2020 and reinforces the confidence we have in this growing product portfolio. Our oncology sales guidance reflects the impact of the first full year of sales for Zepzelca and our expectations for continued momentum in that launch, anticipated Erwinaze supply for the first half of 2021, and the planned launch of JZP-458 in mid-2021. Now turning to our expense guidance. We were pleased with our operational excellence in 2020 and our ability to navigate the impacts of COVID-19 while still making investments for future growth. As we move into 2021, we will continue to prioritize our investments to drive our key objectives of growth and diversification. Our 2021 adjusted SG&A guidance range is $905 million to $945 million, which represents 35% of total revenues at the midpoint. This increased investment reflects our continued prioritization of the launches of Zepzelca, Sunosi, and Xywav, and the planned launches of JZP-458 in mid-2021 and JZP-258 in IH in the fourth quarter of 2021. On the adjusted R&D front, our 2021 guidance is in the range of $330 million to $370 million, or 13% of projected revenues at the midpoint, which is consistent with 2020. With our exciting and differentiated R&D pipeline, we believe these investments will continue to fuel sustainable long-term growth for our expanding and innovative portfolio. Our guidance for non-GAAP adjusted net income and EPS are in the ranges of $915 million to $985 million and $15.65 to $16.85, respectively. Our adjusted net income as a percentage of total revenues will increase to 36% at the midpoint, up six percentage points compared to 2020. Turning to our balance sheet. In 2020, we generated $900 million in cash from operations and ended the year with cash and investments of $2.1 billion. We are excited about the potential GW Pharma transaction and see this as a transformative deal that is consistent with both our overall business and capital allocation strategy and effectively leverages our strong financial and operational position. As we've mentioned, the transaction is expected to accelerate our double-digit top-line revenue growth and be EPS accretive in the first full year of combined operations and substantially accretive thereafter. At close, we expect the pro forma company net debt-to-EBITDA leverage ratio to be approximately 5.4 times. And given our significant cash flows, we expect to reduce this to below 3.5 times by the end of 2022. We view this investment as a disciplined and productive use of our capital to significantly expand our growing neuroscience portfolio and drive substantial value for our shareholders. Finally, we set out an ambitious range of transformative objectives for 2020 and 2021. We are well on our way to executing on five important product launches and diversifying our portfolio and revenue base with products to address significant unmet medical needs and transform patient lives. We are looking forward to the planned close of the GW Pharma transaction in the second quarter and leveraging the combined talents and expertise of the Jazz and GW global teams to develop and launch differentiated therapies to support often overlooked patient populations. Upon close, we look forward to creating an innovative, high-growth global biopharma leader with an enhanced product portfolio, providing the scale and expertise to reach and transform the lives of more patients around the globe with unmet needs.

Thank you, Renée. With that said, please go ahead and open the line for Q&A.

Our first question comes from Jessica Fye with JPMorgan. Your line is open.

Hey guys good afternoon. Thanks so much for taking my question and further color on the Xywav launch. I was wondering if you could say how many active patients around Xywav currently.

Jess, this is Bruce. We're not going to give intra-quarter data like that. We'll obviously update again on our next call. But our body language here is we're really pleased with the way the launch is going, not just during the first couple of months, but as we continue through today.

Thank you. Our next question comes from the line of Amy Fadia with SBB Leerink. Your line is open.

Hi, good morning or good evening. Thank you for the question. Can you discuss the requirements that peers have set for switching to Xywav among patients? Are the majority of these patients dealing with comorbidities, or is there a diverse mix of patients with and without comorbidities?

Yes, maybe I'll ask Kim to weigh in on this one.

Sure. So, we're very pleased, obviously, with the progress that we're making here on the launch, our focus here on the launch is on transitioning Xyrem patients to Xywav. We really are seeing that the vast majority of those patients are experienced on Xyrem in terms of the patients that are on Xywav. But both in terms of having just taken Xyrem or have taken Xyrem in the past. But we also see a portion of patients who are new to oxybate overall and new to Xywav. So I'm very pleased that it's been consistent with our strategy. And I think that you have a question about payer coverage, I'm just trying to clarify that.

Yes. So, with regards to the payer coverage, I'm trying to understand how you're placed on the plan? And what might be certain criteria that payers are requiring physicians to address before allowing patients to switch from Xyrem beside or a de novo patient being allowed to go in Xywav.

Thank you. So, I think, as you know, we've stated, we've had basically a parity strategy between Xyrem and Xywav both in terms of our pricing strategy and our goal of pricing not only at the gross level but also at the net level, the two products at parity. But also in terms of how the two products are treated ultimately on the formulary, we're looking for Xywav to be placed on formulary in a comparable position to that that Xyrem enjoys today. And within that means also not just where it sits in terms of the tier, but how it's treated in terms of utilization management. And so far to date, we're very pleased to say that with the contracts we've signed, we are achieving that goal of parity treatment.

Okay. And if you don't mind, just a final point on that, out of the patients that have been switched to Xywav, up until the end of the year, can you talk about whether or not the mix of patients from that subset that may have other cardiovascular comorbidities or not?

Yes. Dan, maybe I'll ask you to weigh in on that one.

Yes, thanks, Ami. We're positioned well and pleased with the uptake. In the offices adopting the treatment, all patients on oxybate therapy, which is a lifelong treatment with modifiable risk factors, are at risk regardless of their current comorbidities. We're seeing a diverse group of patients. Additionally, new patients are coming in, supported by our suite of access services and increasing payer coverage, with over 60% of commercial lives covered for Xywav as an initial therapy for oxybate compared to Xyrem. We believe that over time, we'll also see patients who weren't previously candidates for Xyrem start therapy, along with growth in the IH indication. We're very pleased with the uptake. Some physicians were more advanced in their understanding of the risk factors and sodium content in Xyrem at launch, while others were not, and patients are also becoming more actively involved in this discussion.

Thank you. Our next question comes from the line of Jason Gerberry with Bank of America. Your line is open.

Thanks, and thanks for taking the question. So Bruce, I appreciate the commentary about favorable body language on the Xywav switch. What I was wondering is, is the switch trending ahead of your expectation? I know you put out some metrics for where you expect it to be in 2023. But just curious if you're operating ahead of expectation, or if we should consider there to be a pent-up bolus. I would assume maybe only 20% of patients have seen probably their doctors since the switch occurred. So I'm a little surprised how high the number was. So just curious if you can provide any commentary there, because I think that will help us think about the progression over the course of the year? Thanks.

Yes. I mean we're still early in the launch. But to directly answer your question, we are ahead of the expectations we had set internally for the first couple of months. And I think as you heard Kim and Dan comment, our messaging is resonating with people about the benefit of this therapy and excitement about it. And so I don't think of this as a bolus that adopted early, we see continued interest and look forward to continuing our educational efforts over the balance of this year. And next and continuing to work toward our goal of this being the primary brand in the oxybate space even out in 2023.

Thank you. Our next question comes from the line of Ken Cacciatore with Cowen. Your line is open.

Thanks so much. Bruce, as we stare at the Xyrem and Xywav franchise, it's kind of a really fascinating modeling exercise as we look at 2023. Obviously, you have Xywav, which could be taking a vast majority of the franchise. And then you have information about the settlements and who can come and the kind of the volume they can supply. And you also know the royalties that they owe back to you. So as we look at 2023, and we try to take all these individual pieces of kind of significant conversion to the franchise and then your knowledge of what could be the generic supply for Xyrem, and again, what they owe you, can you help qualitatively maybe talk through a little bit of either any enthusiasm you have or how we can start thinking about? Maybe a preservation that some of us have modeled a little bit too negatively? And then I just wanted to follow-up on the commentary you made on Erwinaze in 458. I would assume that you all understand the supply that you're not able to put into the marketplace? I would think that information is almost perfect. So can you maybe give us a sense of what we are unable to supply and therefore, what we may be able to supply with 458.

Yes. Thanks, Ken, and maybe I'll take the first part of the question around oxybate and ask Dan to weigh in on asparaginase. In terms of oxybate, the way we're thinking about this is we've got a great growth opportunity in front of us. We're seeing continuing growth in diagnosis and initiation of therapy on oxybate. That's a continuing trend we've had for a number of years now. We see an opportunity with Xywav to address some patients whose physicians were unwilling to start them on therapy, historically due to high sodium load. We see an opportunity, obviously, with idiopathic hypersomnia. Upon the approval and launch of that product later this year and that's a substantial opportunity relative to the size of the narcolepsy population. So we see growth opportunity in front of us. As you go out a few years, we do expect there will be authorized generic competition beginning in 2023 or potentially earlier in some circumstances and as we've disclosed, we have economics, in some cases, substantial economics in those authorized generics, which we distribute through our rents. But to be clear, we think that most patients in this lifelong therapy in this group, known to have high cardiovascular risk will benefit from the advantage of Xywav therapy. So we see the opportunity to expand the product and then really to be a continued preferred treatment far out into the future. Dan, do you want to take asparaginase?

Yes, Ken, on your question about asparaginase. I mean, we don't have perfect information in the sense that we've been supply-constrained for four years. And probably last year was our worst year in terms of supply capacity to the U.S. market. And so as that happened, we've cut back completely on promotion and ISTs and clinical work. We've also put in sort of patient-by-patient verification for product supply. So no inventory sits on the shelves at the hospitals. And we haven't sort of penetrated into certain new geographies like Japan or really helped with the promotion of asparaginase containing regimens for adolescent and young adults. So before we were supply constrained, we were moving above $200 million in product sales, that was several years ago. We believe there's substantial room for expansion with a high-quality, fully recombinant product that physicians can count on that when they start the course of therapy, they can get to the end of therapy and ensure the really successful treatment outcomes that they currently have with asparaginase.

Thank you. Our next question comes from the line of Balaji Prasad with Barclays. Your line is open.

Hi. Good evening, everyone, and thank you for the question. Regarding Xyrem, with the current rate of conversion we are observing, it may soon become irrelevant. However, I'd like to get an update on Avadel. It's been two months since they filed. What is your current strategy? If the FDA accepts their filing, is there a way for you to still require that it be considered a Paragraph IV? How should we consider the impact of this, especially for next year? Thank you.

Yes. Thanks for the questions. We're not going to do any disclosure on behalf of Avadel. We'll keep people posted on where they are with FDA. We'll remind you that, we do believe they should need to Paragraph IV certify against Orange Book listed patents on Xyrem, that have to do with the safe distribution of the drug, both as regards our distribution system, which ensures safe use of the product and limits abuse, misuse, and diversion, as well as helping patients understand an important drug-drug interaction. That Paragraph IV certification can happen on submission, but it can be required at any point during the review process as well. And then, of course, we have what we believe is relevant intellectual property and we'll defend that in the best way possible for Jazz.

Thank you. Our next question comes from the line of Randall Stanicky with RBC Capital Markets. Your line is open.

Great. Thanks. Bruce, how are you guys thinking about total oxybate volume growth for 2021? And specifically, we're hearing from physicians that there's an expectation of a big pickup going forward in oxybate patient volumes. And I'm trying to understand if that's consistent with what you're expecting? And then how much of that would be related to the lifting of COVID headwinds versus the onboarding of new high-risk patients, coming into the patient pool, or even just you being out there more aggressively educating physicians around Xywav and detailing the product? Thanks.

Yes. Maybe I'll start, and then I'll ask Dan if he wants to add. In general, Randall, I'd say this is a really exciting period for narcolepsy patients, with the additions to Xyrem as a standard of care, the addition of Sunosi as a new wake-promoting agent, pitolisant coming to market, now with Xywav coming to market. There are treatment options that weren't available before. There are more people out talking to doctors about appropriate diagnosis and treatment options, and that's good for patients. And if that leads to either more diagnosis or more treatment, that would be really helpful, since narcolepsy is still an underdiagnosed and undertreated disease. In terms of our growth expectations, we know that COVID-19 had an impact. We think that impact is lessening, as we move through 2020. And we, like the rest of the world, are hopeful that 2021 will turn out to be a better year in terms of patients being able to access medical care and get appropriate treatments. We're excited to be promoting a new product. And as we head toward the end of the year, we look forward to a launch in an indication with no currently approved therapy. Dan, any color you want to add?

I want to emphasize what you mentioned about persistence and compliance, which definitely increased during COVID. However, patient diagnoses were hindered, and that has been particularly affected again in the fourth quarter due to COVID. Narcolepsy continues to be significantly underdiagnosed. As more patients become aware of treatment options, whether they have previously tried Xyrem or are new to it, recognizing that there is a longer-term and healthier alternative is key. Patients will be an important part of this journey, and effectively reaching them will be crucial. Additionally, there are patients who previously were salt sensitive and unsuitable for treatment, but now Xywav offers a viable therapy for them. There is also a considerable opportunity for expansion into the idiopathic hypersomnia market, which currently lacks FDA-approved medications, and managed care has limited the availability of oxybate for these patients.

Bruce, are you able to share a volume growth number?

No. So, we provided a neuroscience net sales guidance for the year, which has the puts and takes of Xyrem's, Xywav, and continued Sunosi growth both in the US and ex-US, but we're not giving a specific volume growth expectation. Obviously, as we move out into the very end of the year and next year with a successful IH launch, we expect that there's opportunity for the kind of volume growth we haven't seen in recent years.

Thank you. Our next question comes from the line of Gary Nachman with BMO Capital Markets. Your line is open.

Hi guys. Just following up on the last question.

So Gary. Unfortunately, that was garbled. I was trying to pick out enough words, but I could answer a question that was related spot you asked, but I'm not sure what you asked. So, I don't know if you get a better connection.

Could you hear me now?

That's better.

Could you provide insights into your guidance for this year and how you are preparing to launch the indication into the market? Now that you have had more time to consider the overall opportunity, please share your strategy for pursuing that once it is clear.

Yes. I’ll start with the last point, which is that our guidance for 2021 will be minimal since the launch will occur late in the year. It will take some time to build awareness, as seen with the launches of Sunosi and Xywav, where immediate coverage isn't perfect. So, I wouldn’t expect it to be a significant revenue source this year, although we would like to enroll some patients in the therapy. Perhaps we can ask Rob to provide some insights on idiopathic hypersomnia as a medical opportunity, and then Kim can share some thoughts on the launch?

Phil, why don't I have you go first, and I'll join in as needed.

Great. Thank you, Rob. Yes. So I think as we've understood this population more and more, we clearly understand that this is a chronic disabling disease and these patients have a lot of not only excessive daytime sleepiness but also a lot of dysfunction as a result of that excessive daytime sleepiness. They have a lot of sleep inertia. I think we've talked to you about that before. There are a lot of difficulties waking up and have very long sleep periods in many cases. As we've understood this more and more, and we see the benefits from our OED study, we recognize that we can treat many of the symptoms associated with this chronic disabling disease. From our team's databases, we're aware, as I think we've shared before, that we have about 37,000 patients from patient’s databases. But we've also heard reports from a number of key opinion leaders who are also prescribers of the narcolepsy population that they see a large number of these patients that have ranged from anywhere from up to a similar number from anywhere, I think, from 10% up to 80% to 90% of a similar population in size to the narcolepsy. So we haven't completed all the EPI data around this. I think we'll continue to do that. We just know within the health claims databases. We think it's going to be a sizable opportunity. And I think when we have a chance to share all of the data at the upcoming meeting that Rob alluded to in the second quarter of this year. The data is really compelling and I think will resonate very well with the prescribing population for this target population.

And just to pivot quickly over to launch planning. We've got a team ready to go, obviously, significant overlap with the physician audience we've already got relationships with and are educating about Xywav therapy. We think there's a significant number of underdiagnosis but the current diagnosed patients from a chart poll was 37,000. So that's a big opportunity to start with. And then very importantly, we do have our clinical data from the Phase 3 that has been accepted at an upcoming medical conference in Q2. Really pleased to not only have statistical significance but really clinically meaningful data in terms of the endpoints. And that will be shared six months ahead, and that's great as part of the medical education in advance of the fourth-quarter launch.

Thank you. So just another question on IH. So, the contracts that you have in place right now, is that going to apply to IH patients? I mean, just maybe give us some clarification on how broadly applicable those contracts are as you think about the IH launch? And then a longer-term question is, with the orexin agonists in development, how do you think about the potential impact on the footprint of oxybate in general to the extent that one or more agonists get commercialized?

Yes, David. On the first part of the question on contracting, we've certainly done our contracting with a view toward the evolving narcolepsy treatment landscape. But to your question narrowly, we do need an approved label and have conversations with payers about that before we're done. So no, it's not a fail to complete.

This is Jed. I'll jump in. I think it's fair to say that everyone is excited about the potential for orexin agonists to be helpful in the treatment of narcolepsy. The mechanism or orexin agonists is substantially different from the mechanism of oxybate. And we anticipate the orexin agonist will likely have a pharmacodynamic impact that's similar to what we see with weight-promoting agents and stimulants. And so, we expect that long term, those agents would be complementary to oxybate in treating narcolepsy.

I hadn't thought to ask Jed a question, but since he's got the mic, maybe you could offer any thoughts you have on cannabinoids and sleep? I'm guessing you have some thoughts there. But my other question was for Renée. When you closed the GW deal, do you provide updated guidance right on the back of that or the next scheduled quarterly conference call? Maybe you could just set the stage first on what and how you will guide? Thanks.

I think we should hold off on the question about cannabinoids and sleep for now to save time. We'll share more information about the combined neuroscience pipeline during the closing, but I'll let Renée address your guidance question.

Yes. Thank you. And as you can appreciate, we're still working through getting to close of the transaction. And so once we actually close the transaction and are running the business, then we'll have a much better feel for the timing of the guidance that we'll provide for the combined company. We will certainly provide updated guidance to reflect Jazz combined with GW post-close, but the exact timing of that is a little early to say.

Thanks very much. So management had hosted a very compelling call on the risk of high salt intake last year, and it seems logical that most doctors and patients would opt for Xywav instead of Xyrem, and that should potentially drive a faster-than-expected switch. But my question is, how would you characterize the risk of potentially triggering an early Xyrem generic entry in 2022, before you have a full year to drive Xywav adoption in idiopathic hypersomnia? Obviously, the current assumption is the IH launch occurs at the end of 2021, I believe. And then the generic entry against Xyrem is in January of 2023. So if you could just provide some perspective on that, that would be helpful. Thank you.

Yes. Good question, Dave. And let's just say, we want to help as many narcolepsy patients as possible with Xywav. We are not holding back in any way. If we're so successful that we've triggered earlier generic entry, that is a success scenario from our standpoint in terms of our progress with Xywav. Specific to the IH launch, we did our studies with JZP-258 or what's on the market as Xywav and the IH indication would be specific to that product.

Hi. Thanks for taking my questions. Congratulations on another good quarter. Maybe just changing gears a bit here and focusing on Zepzelca, another good quarter there. Can you provide some color in terms of how much pent-up demand are we still seeing in third and fourth-line versus pure second line? And I know you mentioned that both platinum-sensitive and platinum-resistant are growing usage. Any way to parse that out a bit more just in terms of the uptake between sensitive and resistant? Thank you.

Yes. For Zepzelca color, maybe I could ask Kim, to just talk a little bit about what you're seeing in terms of how the launch is progressing.

Yes, sure. So we remain very pleased with the response to the launch among the small cell lung cancer treating community. Feedback to the profile and what they've seen in their patients has been quite positive. As you see there, we're seeing nice growth in the product overall. What I can tell you is that we're seeing growth through December, the data that we have across all patient types, including second-line, as you said, in both types of second-line patients in terms of platinum-sensitive and platinum-resistant. So I think we're still in a stage where physicians are getting experience with it and are seeing a tremendous unmet need, a strong profile, and still using it across a broad spectrum of patient types.

Okay. Thanks. And are we still seeing usage from certain fourth line patients as we saw last quarter?

Yes, through the data that we have, we're still seeing strong usage there.

I will say our goal is, over time, to have this become the standard for second-line small cell lung cancer treatment and to have patients get it at that point. Obviously, that hasn't been true in the first few months after launch, right, because we’re establishing awareness, but over time we’d expect that second line share to go up and therefore, to see less usage later. Of course, in the second line, we'd expect a longer duration of therapy as well.

Hey there. Thank you for the question. So, two for me. One on JZP-458. Dan, you mentioned that you've been somewhat out of the market with this product. So, I'm wondering, as you're preparing to launch 458, if you can help us understand how we should be thinking about the launch trajectory compared with where Erwinaze sort of left off? Or leaves off in the middle of the year?

Dan, you want to take that?

Yes, I think I'm going to punt on that question. I mean, we're going to give more detail as we've got precise launch timing and launch label and frankly, also know what the asparaginase market looks like in the US, but we do see opportunity for growth from where we've been clearly across all the categories I referenced. But I'd say stay tuned a little bit longer on anything more precise.

Sure, I'm happy to, Bruce. This is Rob now. The proof-of-concept Phase 2 study was conducted before the acquisition. It was done with a formulation that was fit for purpose. And so our initial steps were to develop a once-daily formulation that could be commercialized, and that's what we refer to as the healthy volunteer study, and that will be taken forward into the pivotal Phase 2b study that we referenced earlier.

Thank you. Our next question comes from the line of David Steinberg with Jefferies. Your line is open.

Thanks. I know you've addressed several questions about the Xywav switch, but I would like to dig a bit deeper. Based on the number of patients on oxybate therapy you provided at the end of the year and those you indicated were active Xywav patients, it seems there's about a 12% switch rate. However, I understand that doesn't account for some newer patients. I'm curious about the percentage of non-recent oxybate switches among new patients that were merely the natural progression of newly diagnosed narcolepsy cases versus those who previously could not use Xyrem due to cardiovascular issues or comorbidities. Additionally, regarding patients with severe cardiovascular problems who were unable to take Xyrem, some key opinion leaders have varying estimates of that percentage, with some suggesting it could be as high as 20%. Based on your research, what do you estimate is the number of patients with significant cardiovascular issues who previously could not use Xyrem? Thanks.

Yes, Dave, you made some good points. You keep mentioning the word switch. I want to remind you that, as you noted in your question, we have patients coming to Xywav in various ways: some coming directly from Xyrem, some from previous use of Xyrem, some with new diagnoses, and some whose physicians may not have thought they were suitable candidates for the high sodium product in the past, despite having a diagnosis. Initially, as expected before the launch, we are observing that most of the new starts on Xywav are from patients who have previous experience with Xyrem. This is not surprising to us. Regarding the exact number of patients who historically did not receive Xyrem due to those concerns, I can't provide exact data, but we acknowledge that it's a substantial population. We see varied estimates on that, and tracking it precisely is challenging.

Thank you. Our next question comes from the line of Annabel Samimy with Stifel. Your line is open.

Hi. Thank you for taking my question. I want to ask about Zepzelca for a moment. I understand that a confirmatory trial is required and you're still in discussions with the FDA. Can you provide any details about the type of trial you might consider for Zepzelca, whether it involves combinations or other approaches? Additionally, regarding the sodium oxybate franchise, the pricing parity seems to have accelerated contracting, which is already at a solid 60%. Do you anticipate this process to continue at a rapid pace or quicker than usual? What can we expect regarding the timing for net price normalization, especially as payers start reimbursing the drug regularly without as much patient assistance? Thank you.

Yes. So far, we have only had a very preliminary discussion with the FDA where we presented the ATLANTIS data, and we expect to have a more meaningful discussion on what would constitute a confirmatory data package sometime in Q2. So no further details really to offer on that, I would say that we have disclosed that we're very interested in evaluating Zepzelca in first-line extensive stage small cell lung cancer, and that would be a switch maintenance design, where we'd be adding on to existing therapy. So in the maintenance setting, it would be an immunotherapy plus or minus Zepzelca versus immunotherapy plus placebo for example. I also would mention that we do have an observational Phase 4 study that's intentionally designed to gather additional useful information in the second line indicated setting.

Thanks for taking my question. Congrats on a really nice quarter. Maybe I'll ask a different question that has to do with your BD strategies going forward. Clearly, the last 12-plus months or so, you've executed on a number of nice deals and it's kind of changed the trajectory of the top line. And with that in mind, given the size of the acquisition, what should we be thinking about in terms of BD and whether it's a priority over the next 12 to 24 months, you have quite a robust pipeline and you're integrating a fairly significant acquisition. So we'd love to get any color there? Thanks so much.

Sure. Graig, this is Renée. I'll take that one. So granted, the GW transaction is a meaningful transaction for us that we're very excited about. We've talked for a while about the potential opportunity to do a transformative transaction to be able to accelerate our strategy. And we've lined up financing that we think still gives us adequate flexibility to both invest in our important product launches, invest in our pipeline and then invest in additional business development transactions for the right asset. We still see plenty of opportunities to continue to add to expand the pipeline, both in neuroscience as well as in oncology because you see we have quite a few things we brought into the pipeline, and we want to continue to focus on bringing in both differentiated assets and then building a durable business.

Hey guys. Thanks so much. On Xywav, have you heard anything back from the FDA on your application for orphan drug exclusivity for narcolepsy? And additionally, if you do get the ODE, what would that mean theoretically for the Avadel product? Additionally, do you have any updates on your once-nightly program? I know it looks like your Phase I trial should have read out by now? Thanks.

Yes. So no particular updates on either. As you know, FDA does not have a particular clock there on when it comes to ODE. So we're waiting to hear on that. That should become public once it's decided, and I won't speculate on impact on Avadel. You can ask them that question. And I forget the second part of your question. Once-nightly, yes. So we have not said more about our once-nightly development program, although it continues.

Hey good evening, and thank for fitting me in. Bruce, I wonder if you can share with us whether the payer equipment that you have on Xywav and Xyrem give you preferred position versus other oxybate drugs? And then to the extent you chose not to take that one, I was wondering if I can ask you about the share of prescribers who have not used Zepzelca yet?

Yes. Regarding the first point, we are focused on ensuring that patients can easily access what we consider to be an important treatment option in Xywav. Generally, this means we want them to have reasonable ways to obtain treatment, following appropriate diagnosis and, in some cases, having tried other therapies. Essentially, this approach is similar to what we've experienced with Xyrem for quite some time. As for Zepzelca, I'm open to my colleagues contributing about the expectations for doctors who have not yet prescribed Zepzelca in the second line.

Thank you. I'm showing no further questions in the queue. I would now turn the call back to Andrea for closing remarks.

Thanks all for joining us.

Maybe just before I flip it back to Andrea, just to say thanks to the team at Jazz for really an incredibly productive 2020. And I hope all of you on this call take away that 2021 looks like another exciting year with lots of product launches, lots of clinical progress, excitement about the GW transaction and what that can mean for Jazz, for patients, for employees and for our shareholders. We've got a lot ahead of us and hope to continue executing exceptionally well. Andrea?

Thanks, Bruce, and thanks, everyone, for joining us today. We'll be participating in the upcoming Leerink and Cowen virtual conferences and we hope to speak with many of you then. This concludes our call.

Ladies and gentlemen, this concludes today's conference call. Thank you for your participation. You may now disconnect.