Earnings Call Transcript - NBIX Q2 2024

Operator, Operator

Good day everyone and welcome to today's Neurocrine Biosciences' reports of Second Quarter Results. At this time, all participants are in a listen-only mode. Later, you will have the opportunity to ask questions during the question-and-answer session. It is now my pleasure to turn the conference over to Vice President of Investor Relations, Todd Tushla. Please go ahead.

Todd Tushla, Vice President of Investor Relations

Thank you, Chloe. Welcome to Neurocrine Biosciences' second quarter 2024 earnings call. With me are Kevin Gorman, our current Chief Executive Officer; Matt Abernethy, Chief Financial Officer; Eiry Roberts, Chief Medical Officer; Eric Benevich, Chief Commercial Officer; and Kyle Gano, Chief Business Development and Strategy Officer, who will become Neurocrine's next CEO on October 14. This will be Kevin's last earnings call, and he plans to share a few closing thoughts following Q&A. Before we begin, we will be making forward-looking statements. These statements are subject to certain risks and uncertainties, and our actual results may differ materially. I encourage you to review the risk factors discussed in our latest SEC filings. With that, I hand the call to Kevin.

Kevin Gorman, CEO

Thank you, Todd. Good morning, everyone. We have a lot to go over this morning, but I'd like to start out with a statement that we have no information to share on either Luvadaxistat or NBI-'568 or M4 agonist. Both trials remain blinded, and neither database is locked. Now, this has been an excellent quarter. I know you probably get tired of me saying this, but I never do. We have better than 30% year-over-year growth for ININGREZZA. We've had an approval of the ININGREZZA SPRINKLE priority review for Crinecerfont. Compelling Phase 2 data for our AMPA modulator and major depressive disorder, multiple new compounds entering the clinic, and best of all, the company will finally be rid of me. It's now very obvious that there are many more TD patients that need and want treatment. It takes investment to reach these patients, and each time we've made that investment, either expanding our sales force or utilizing direct-to-consumer advertising, it has propelled ININGREZZA to a new level because we can educate more HCPs and reach more patients. Financially, it has always been very ROI positive. But the investment doesn't stop there. We continue to explore ININGREZZA in the clinic, in Dyskinesia and Cerebral Palsy, and as an adjunctive treatment for Schizophrenia. Additionally, we are developing the next generations of VMAT2 Inhibitor. This will be a crucial part of Neurocrine for a very long time. Furthermore, we have a life-changing drug in Crinecerfont, which has orphan drug designation and breakthrough designation, and we now have priority review. We're working with the FDA on the review and are excited to get to the PDUFA data at year-end. This drug will change the entire treatment paradigm for CAH patients. Finally, I believe we have the most robust preclinical and clinical pipeline in neuroscience globally. This will be more apparent next year as our biologics enter the clinic.

Matt Abernethy, CFO

Thank you, Kevin. 2024 continues to be a tremendous year for Neurocrine. Between positive data for our input potentiator and major depressive disorder, priority review for Crinecerfont, the growth momentum continues to build, positioning us as leaders in neuroscience for years to come. In gross Q2 sales were $580 million versus $440 million in the prior year, representing 32% year-over-year growth. With this performance, we are raising the 2024 gross and net sales guidance range to $2.25 billion to $2.3 billion, compared to our previous range of $2.1 billion to $2.2 billion. We are also updating our GAAP SG&A expense guidance by approximately $35 million, with $20 million to support the continued growth of ININGREZZA and $15 million non-GAAP impairment charge associated with vacating office space as we migrate to our new campus. Being a high-growth company, we continue to make capital allocation decisions to prioritize accelerating revenue and advancing our R&D pipeline for sustained growth. With ININGREZZA's momentum launching a potential second blockbuster with Crinecerfont and advancing clinical programs into phase three, we have the building blocks for continued success. Although we're not at a point to provide official financial guidance for 2025, I want to highlight a few items for your consideration while you develop your operating expense expectations for SG&A over the past several years. Our focus has been on generating top-line revenue growth, reaping the benefits of previous investments. Heading into 2025, our investment will increase with an additional $125 million to support our top priorities with the successful launch of Crinecerfont and delivering aggressive growth. Regarding R&D investments, although we're still waiting for important data calls this year, I want to emphasize our willingness to invest heavily behind any program that shows positive proof of concept data and to accelerate high-value preclinical programs into the clinic. With growing sales and an advancing pipeline, we find ourselves in a unique position with financial flexibility to advance important potential medicines like our AMPA program through the clinic over the second half of this decade in a non-dilutive manner. There’s a lot of work ahead, but these are very exciting times at Neurocrine. With that, I'll hand the call over to Eric.

Eric Benevich, Chief Commercial Officer

Thanks, Matt. The momentum we saw within ININGREZZA in Q1 has carried through into our performance last quarter. Q2 growth of over 30% versus the prior year is a testament to the strength of our underlying business across tardive Dyskinesia and Huntington's disease Chorea. With sales approaching $1.1 billion in the first half of this year, we've raised and narrowed our full-year sales guidance as Matt mentioned, to a range of $2.25 billion to $2.3 billion at the top-end. At the midpoint, this range equals approximately 24% growth versus 2023. We've learned a lot about the TD market since the launch of ININGREZZA seven years ago. It's critically important that we continuously evolve our approach and invest to help more patients that can benefit from in-depth therapy. Each time we expanded the sales force in the past, we saw a clear increase in diagnosis and treatment with ININGREZZA usually a couple of quarters after deployment of the new salespeople. Every year, we evaluate the adequacy of our commercial footprint to meet the needs of our healthcare customers and the patients they care for. We recognize that there remains much more opportunity to reach and educate healthcare professionals that care for patients living with TD or HD Chorea, and we need to strategically adjust our commercial resources to meet their needs. With that as background, we are increasing the size of our psychiatry and long-term care sales teams this year to accelerate appropriate diagnosis and treatment with ININGREZZA. We plan to have the new team members in the field by the fourth quarter. As with previous sales force increases, we anticipate tangible contributions from the new salespeople within a few quarters. We continue to invest in ININGREZZA because we have strong conviction in the opportunity. In addition to investing in our team, we are investing in the brand. We're proud to have recently made available our new ININGREZZA sprinkle formulation. With this launch, ININGREZZA offers a sprinkle formulation that provides an alternative administration option for patients who experience Dysphagia, have difficulty swallowing, or prefer not to swallow a pill. Our data tell us that upwards of 10% of people living with TD or HD Chorea experience Dysphagia or difficulty swallowing. It's crucial we provide this option to patients who want treatment without the potential challenge of swallowing a pill. The ININGREZZA sprinkle capsule is easy to open, and the granules can be sprinkled on soft food such as applesauce, yogurt, or pudding for oral administration. ININGREZZA is the only VMAT2 inhibitor to offer one pill, once-a-day dosing with no complex titration required to reach an effective dose, providing both oral capsules and a sprinkle formulation to meet the diverse needs of people living with TD or HD Chorea. Given the long runway of exclusivity through 2038, expanding our commercial footprint and investing in the brand provides significant growth opportunities ahead in the TD and HD Chorea markets. Now shifting to Crinecerfont, we had a learning launch in TD with ININGREZZA, and a similar approach will apply to Crinecerfont in congenital adrenal hyperplasia (CAH). People suffering from CAH have not experienced new treatment options in over 70 years before the potential approval of Crinecerfont at year-end. Our rare endocrinology commercial team, which is now fully hired, is focused on market development initiatives to better understand and inform the CAH community. We held a kickoff meeting for our endo franchise team in July, and I was impressed by their enthusiasm for helping the CAH community. Given the terrific clinical profile of Crinecerfont, the clear unmet need in CAH, and our reputation as a great place to work, we've managed to attract members to our endo team with, on average, over 20 years of biopharma experience and more than 10 years focused on rare diseases. For the balance of this year, that team will focus primarily on delivering disease education to endocrinology healthcare providers under our 'What the C@H?!' initiative. This unbranded educational resource aims to close the gap in CAH understanding and acknowledge the challenges faced by members of the CAH community. With priority review granted, we are prepared to bring Crinecerfont to patients in the new year quickly following FDA approval. We have demonstrated with ININGREZZA that we can successfully launch and establish a new therapeutic category, and we are excited to do it again with Crinecerfont.

Eiry Roberts, Chief Medical Officer

Thank you, Eric, and good morning to everyone on the call. I'm pleased to share that we've made substantial progress with our clinical pipeline in the last quarter, including the delivery of several important clinical milestones. I'll begin with NBI-'845, a highly selective potentially first-in-class positive allosteric AMPA modulator. In April, we announced top-line results from the SAVITRI study in patients with major depressive disorder who have inadequate response to currently available treatments. The primary endpoint was achieved, with NBI-'845 demonstrating a statistically significant reduction in the Montgomery-Asberg Depression Rating Scale total score at day 28. The study also met key secondary endpoints, including a statistically significant reduction in the MADRS total score at day 56. Importantly, NBI-'845 exhibited a strong effect size and was generally well tolerated. We are currently working towards an end of Phase II study meeting with the FDA later this year to support the initiation of registration studies for NBI-'845 next year. Turning to Crinecerfont, in June, we presented both the adult and pediatric Phase III CAHtalyst study results at the endo meeting, with parallel publication of the results from both studies in the New England Journal of Medicine. In July, the FDA accepted the Crinecerfont filing and granted priority review, recognizing the seriousness of congenital adrenal hyperplasia and the high unmet need, as well as the potential Crinecerfont can provide significant benefit for patients with this chronic debilitating disorder. The PDUFA dates for both the capsule and oral solution NDAs for Crinecerfont are now set for late December. Additionally, the agency had previously granted breakthrough therapy designation, orphan drug designation, and rare pediatric disease designation to Crinecerfont. Upon FDA approval, this will enable Neurocrine to activate a rare pediatric disease designation priority review voucher, which can be utilized to accelerate the review process for a future registrational program. While the FDA is not planning for an outcome meeting, our teams are well prepared to engage with the agency in support of the FDA review process, including preparing for an outcome if scheduled at some point. This quarter, we remain on track to deliver data from NBI-'568, our selective muscarinic M4 Agonist study as a potential treatment for schizophrenia. We plan to communicate the Phase II study results via press release and a conference call, where you should expect to see total PANNS score change, placebo-adjusted PANNS score change, effect size, and safety measures. In Q3, we aim to deliver data for Luvadaxistat as a potential treatment for cognitive impairment associated with schizophrenia. All other clinical programs continue to make progress, including our expanding Phase I portfolio. In the last quarter, two new Phase I molecules entered the clinic: NBI-'986, a selective M4 Antagonist, for potential treatment of movement disorders, and NBI-'567, an M1 preferring muscarinic agonist from our muscarinic agonist portfolio, totaling four early-stage compounds in development. We will provide more details on these programs as they advance towards Phase II. Overall, I’m pleased with the continued evolution of our portfolio, which reflects the deepest, broadest pipeline in Neurocrine's history. I look forward to further advancing these efforts to provide meaningful new therapies for patients living with chronic debilitating diseases in neurology, neuropsychiatry, neuroendocrinology, and neuroimmunology. Our goal remains to deliver important improvements in clinical outcomes for patients with significant needs but limited options. And for one last time, back to you, Kevin.

Kevin Gorman, CEO

Thank you very much, Eiry. So you can't imagine how happy she is that it's one last time that she's giving these back to me. We're ready for your questions this morning.

Operator, Operator

We'll take our first question from Phil Nadeau with TD Cowen. Your line is open.

Philip Nadeau, Analyst

Good morning. Thanks for taking our question, Kevin. First, congrats to you on a tremendously successful career at Neurocrine. You've really built the biotech bellwether, and your efforts and insights have helped countless patients. So we hope you have a long, happy, and healthy well-deserved retirement. Eiry, a question for you. There's a lot of focus on 568. Thanks for setting the table on what you're going to announce in the future. It's been hard to diligence the compound because there's not a ton published on it, but I believe Sosei has presented some data from a healthy volunteer study. Could you review for us that data? What's known from Phase 1 in terms of muscarinic side effects, cardiovascular effects, potency to the target, or any other information that’s been released?

Eiry Roberts, Chief Medical Officer

Yes. Thanks, Phil. As I mentioned, we will be delivering the data from our Phase I proof-of-concept study in schizophrenia this quarter, and Kevin articulated what you can hope to see. In terms of the timing for that study, we had a broad range of both preclinical data and Phase I information that made us very confident regarding the safety and tolerability of the doses we were taking into the clinic. We expected a range of muscarinic responses. The purpose of this Phase II study is to learn more about the efficacy and tolerability of the molecule in schizophrenia and give us insights around potential differentiation moving forward for this selective M4 Agonist. This is a dose-finding study, and the doses taken into the study reflect our confidence in the pharmacology we're anticipating. This allows us the opportunity to demonstrate the range from hopefully minimally effective to maximally tolerated doses within this study.

Philip Nadeau, Analyst

And have you disclosed the adaptive rules? By what rules are the patients shuffled between the arms?

Eiry Roberts, Chief Medical Officer

We have not disclosed that. What I can say is there is an independent DMC that reviews tolerability data for each cohort as we proceed through the study, guiding the dose for the next cohort. We do not know the total dose in the study, and it won't be long until we get to that data.

Matt Abernethy, CFO

During our call that we'll have this quarter, we will spend time going through this study design to ensure there's clarity around that.

Philip Nadeau, Analyst

Kevin, congrats again.

Kevin Gorman, CEO

Thanks a lot, Phil. As I prepared for today, I made the observation that probably you and I have worked together longer than any other pair of CEO and analysts that I can remember.

Operator, Operator

We'll move next to Paul Matteis with Stifel. Your line is open.

Paul Matteis, Analyst

Hey, thanks for taking my questions. And Kevin, I'll echo Phil's congratulations. It’s always been a lot of fun working with you. I have another question on the muscarinic. There's been a lot of conversation with Eiry related to the PANNS effect size hurdle. What would be interesting as it relates to efficacy? How are you thinking about other attributes of the target product profile here? What else is important to you for advancing the molecule? Specifically, I'd love it if Eiry could comment on what you think about QD versus BID, what your expectation is, and whether that's important to you? Also, what’s the expectation on GI side effects, and whether you anticipate something that’s more emraclidine-like or KarXT-like?

Eiry Roberts, Chief Medical Officer

Yes. I think I'll begin with the mechanism. This is an M4 selective agonist, and we can expect that the profile will be different from a PAM muscarinic agonist in terms of tolerability. We have not seen any problematic evidence of GI issues in our Phase I and preclinical data. Regarding overall profile, we have been consistent in saying that we expect a placebo-adjusted change in PANNS Score at the primary endpoint of approximately eight or greater, but it's essential to look at the full data context, including tolerability and other endpoints.

Paul Matteis, Analyst

Eiry, have you disclosed anything on dosing?

Eiry Roberts, Chief Medical Officer

We have in our Phase I program looked at both QD and BID dosing for this molecule. However, we do not know the dosing regimen finalized in the Phase II study at this moment, but we will know that very soon.

Operator, Operator

We'll move next to Tazeen Ahmad with Bank of America. Your line is open.

Tazeen Ahmad, Analyst

Hi. Good morning. Thanks for taking my question. Another congrats, Kevin, on building a great company. It's hard to do, and you're going to be missed. I wanted to go back to ININGREZZA. Trends have consistently beaten expectations for several quarters now. What do you think still needs to be done to justify increasing the size of your sales force? You seem to be doing well with the size you already have.

Eric Benevich, Chief Commercial Officer

Yes, Tazeen. We're investing in growth. As I mentioned in my remarks, over the course of seven years that ININGREZZA has been on the market, we've continuously evolved our approach to developing the TD market and educating HCP customers about ININGREZZA. This expansion is part of that evolution. We're evolving to meet our customers' needs. The majority of our business resides in the psychiatry segment, which we did not increase in size back in 2022, and the number of TD treaters and potential treaters has continued to grow. We feel it's prudent to add sales representatives and support for the psychiatry segment. We have also seen significant potential growth in the long-term care segment we began entering a couple of years ago.

Matthew Abernethy, CFO

The only thing I'd add is that it reflects the conviction around the market opportunity still ahead of us. We believe seven or eight out of ten patients that have TD are not being treated with a VMAT2 inhibitor today. There remains a large market opportunity ahead to help many more patients.

Operator, Operator

We'll move next to Anupam Rama with JPMorgan. Your line is open.

Anupam Rama, Analyst

Hey, thank you for taking the question. Kevin, epic run, man. Wishing you all the best going forward. I'm definitely going to miss you. Quick question: what are the key levers for driving growth for the ININGREZZA guidance rate in terms of the physician segment—psychiatry, neurology, long-term care? Is there any outsized growth that you're seeing driving the guidance range?

Eric Benevich, Chief Commercial Officer

Ultimately, what we're seeing is that all three business segments are growing nicely. ININGREZZA is a very promotionally sensitive product. As we continue to raise awareness, educate around TD, and drive recognition and diagnosis, the feedback in treatment has been positive. We felt very comfortable raising guidance halfway through the year, and our sales have surpassed $1.1 billion. Also, we've refined our guidance, so our ability to grow in the second half of this year comes from continuing to drive recognition, diagnosis, and treatment, solidifying ININGREZZA as the #1 most prescribed VMAT2 inhibitor.

Operator, Operator

We'll move next to Akash Tewari with Jefferies. Your line is open.

Akash Tewari, Analyst

Hey, thanks so much. And Kevin, it’s really been a pleasure to work with you and the team you’ve built. For 568, did Nxera measure any biomarker success in terms of M4 versus M1 target engagement? There have been some questions about how selective you can be for both targets given receptor similarity. Does your team share that concern? Additionally, for your upcoming readout, how do you determine if patients can dose up to another cohort safely? Is it based purely on tolerability, or are you also measuring exposures?

Eiry Roberts, Chief Medical Officer

Thanks, Akash. Let me address your second question first. Just to clarify, the design of the study allows for dose adjustments, but it’s not that individual patients titrate within the study. An independent group reviews the dose level given to a series of patients and makes recommendations on the dose for the next cohort based on tolerability. We're confident about the selectivity of our molecule. Nxera has done substantial preclinical work, and we assure you this is a selective M4 agonist. We are also exploring other molecules with balanced M1 and M4 activity, such as 570. I'll emphasize that we are confident in our clinical data, and we'll share more as we progress.

Operator, Operator

We'll move next to Jay Olson with Oppenheimer. Your line is open.

Jay Olson, Analyst

Oh, hey. Congrats to Kevin on all the work you've done for patients in need and the amazing team you put in place to continue that progress. At this point, I’d like to ask Kyle if you could please share your long-term vision for Neurocrine as you step into a leadership role?

Kyle Gano, Future CEO

Thank you, Jay. Kevin left quite a legacy at Neurocrine, and I've been honored to work with him. Thinking about the company today and the strategic plan we've instituted, I believe it remains the right path. There are many exciting opportunities ahead for Neurocrine. We are currently a fully integrated company, having discovered and developed three FDA-approved medicines, which were all first-in-class. Taking one of those—INGREZZA—it's our growing blockbuster for tardive Dyskinesia and Huntington's disease. Even today, two-thirds of patients are still not diagnosed with TD. There's substantial work and opportunity ahead. The results we've seen with Crinecerfont's data are another chance to treat many more patients when approved. We expect our PDUFA dates later this year will position us nicely for an early 2025 launch. Crinecerfont, as another first-in-class product, potentially has blockbuster traits. I hope you see a theme in the programs we invest in and take on. We have late-stage pipelines entering next year and are transforming our R&D focus towards internally discovered programs and organic growth. This includes transitioning to disease modification and curative therapies, such as gene therapy. We're moving towards validated targets and that holds promise for our future.

Operator, Operator

We'll move next to Chris Shibutani with Goldman Sachs.

Cameron Bradshaw, Analyst

This is Cameron trying on for Chris. Let me just add my congratulations to Kevin on the quarter for the team. Just had a couple of quick questions regarding gross to net dynamics this quarter. That was something you mentioned in the press release; how should we think about that? Any specifics there? And going into the second half of the year, for gross to net, what should we expect? And just a quick one on business development and potential appetite there given your growing internal pipeline, including Phase II and Phase III assets?

Matthew Abernethy, CFO

On the BD front, we're currently focused on developing our pipeline. We have important data cards to read out this quarter that will inform how we allocate capital moving forward. But we have a lot of great things going on, and we do have financial flexibility while focusing internally. Regarding gross-to-net dynamics, our growth this quarter was primarily driven by volume. There is expected improvement in gross to net from Q1 to Q2 in the low single-digit type range. The gross to net is very much in line with what we anticipated, so nothing specific to flag for the second half of the year.

Operator, Operator

We'll move next to Brian Skorney with Baird. Your line is open.

Brian Skorney, Analyst

Hey, good morning everyone. Thank you for taking the question. Also, let me offer my accolades to Kevin for an incredible job. It's been a long time; I’ve been following the story for over a decade. Kevin and Kyle's transitions are similar to Tim's and Matt's—you can expect great things ahead. A question on Luvadaxistat: if you're able to replicate the cognitive effects seen in the INTERACT study, how do we view that as a marketable indication in absence of PAM's benefits for patients? What’s the clinically meaningful threshold on the VAC composite score? Is statistical significance alone important right now?

Eiry Roberts, Chief Medical Officer

Yes. This is a highly significant unmet need. A vast majority of patients suffering from schizophrenia deal with cognitive impairment, especially as we obtain more treatments for positive symptoms. Currently, nothing is available to assist patients in this area. This is why we were encouraged by INTERACT data despite not hitting our primary endpoint for negative symptom improvement. We achieved a positive signal that showed robust results regarding the magnitude of changes. If we replicate that in our Phase II study with the 200 patients, it’s a meaningful step towards managing that important area for schizophrenia patients. The next step will be to engage with the agency to clarify the registration path given our success.

Operator, Operator

We'll move next to Mohit Bansal with Wells Fargo. Your line is open.

Mohit Bansal, Analyst

Great. Thank you very much from my side, and congrats Kevin on an amazing career, wishing you a very healthy retirement. Regarding the adaptive study design for M4, could you discuss that? When you mention adaptive design, is it primarily related to efficacy, or is it mainly for safety? When we look at the data, should we focus on the highest dose, or should we concentrate on the overall drug profile when the data are released?

Matthew Abernethy, CFO

This is Matt. We will be limited on what we share regarding 568 right now. The dose escalation is primarily based on safety, as Eiry mentioned. We will be looking at all levels of dosing, so stay tuned for more information this quarter.

Operator, Operator

We'll move next to Marc Goodman with Leerink. Your line is open.

Marc Goodman, Analyst

Yes. Good morning. Congrats to Kevin as well. I have a question regarding Crinecerfont. Given all the data seen from Crinetics at the endo meeting, what are your thoughts on the ACTH antagonist mechanism, and how do you foresee the market evolving?

Eiry Roberts, Chief Medical Officer

I’m encouraged to see other companies moving into the CAH space to help patients—this community hasn't seen new medications in decades. We’re far along with Crinecerfont, having reported positive data in both adults and pediatrics. The opportunity is particularly significant for the pediatric population. The >95% rollover rate from each Phase III study into long-term open-label extension of Crinecerfont demonstrates that it is well tolerated, with most patients receiving benefits. The ACTH antagonism approach makes biological sense, and we chose this CRF1 antagonism route because we believe it is optimal for CAH treatment. We have encouraging data from the anti-ACTH approach; however, it’s vital to observe how those results translate into larger trials with diverse endpoints. Our focus remains on bringing Crinecerfont forward as quickly as ethically possible.

Marc Goodman, Analyst

On the 568 front, messaging indicates an expectation for an 8 point delta on the PANNS. If that emerges without any safety advantage over KarXT, what might that mean for the program?

Eiry Roberts, Chief Medical Officer

While we don't view any single data point in isolation, we're examining the overall information generated. We will consider all data when analyzing our program's pathway moving forward.

Operator, Operator

We'll move next to Carter Gould with Barclays. Your line is open.

Carter Gould, Analyst

Great. Good morning. Let me offer my congrats to Kevin as well and best of luck in future endeavors. I wanted to shift things up a bit and inquire about 845. Should we expect the Vetri presentation of that data at a scientific meeting before the year-end? And as you contemplate willing to invest in it, does that imply a potential broadening of 845 beyond just MDD?

Eiry Roberts, Chief Medical Officer

Currently, our focus is on our major depressive disorder indication. We're pleased with the results for the SAVITRI study and wish to engage with the FDA about the next steps for a potential registrational program. As for future presentations, we'll share updates when we have more details.

Operator, Operator

We'll move to Myles Minter with William Blair. Your line is open.

Myles Minter, Analyst

Thanks for the question, and congrats Kevin. I hope the Walt Disney team at Neurocrine HQ stays on beyond your departure. Regarding 570 and 567, when can we expect the Phase I data? And if it looks clean on the nausea and vomiting signal seen with other molecules, how would that affect your positioning for those against additional indications?

Eiry Roberts, Chief Medical Officer

Great question. We're tracking 570 and 567’s progress through Phase I. We have made progress, and there’s a lot of interest in the data. However, we need to complete Phase I before we can make conclusive statements.

Operator, Operator

We'll move next to Brian Abrams with RBC Capital Markets. Your line is open.

Unidentified Analyst, Analyst

This is Joe on behalf of Brian. Congrats on a strong quarter. On behalf of Brian, I wanted to pass on congratulations to Kevin on all your accomplishments and Kyle on the new role. I’d like to return to M4: based on the safety profile from the Sosei study and what you're observing per the DSMB recommendation, what opportunities do you think exist beyond schizophrenia? Would you consider expanding into younger populations like bipolar disorder or indications in older populations?

Eiry Roberts, Chief Medical Officer

Currently, we are concentrating on the data from the Phase II study. There are many opportunities based on the nature of the data we have, and we will fully consider them. As we get into the quarter with upcoming data, we'll share more insights.

Operator, Operator

We'll move next to Cory Kasimov with Evercore ISI. Your line is open.

Cory Kasimov, Analyst

Hey, good morning. Thanks for taking the question, Kevin. I'll add my congrats on a great run and appreciate your work. Can you discuss how market education may be a gating factor to the launch of Crinecerfont—how you foresee centers of excellence possibly acting as a driving force?

Eric Benevich, Chief Commercial Officer

Yes, certainly. We believe that centers of excellence will be important. However, there aren't many of them, and it's crucial that we reach patients and families living with CAH who rely on community endocrinologists. A few months ago, we launched our educational initiative called 'What the C@H?!', aimed at both endocrinologists and patients' families. We're focused on educating the CAH community about challenges and improving care through awareness. We’re also assessing where these patients are to position ourselves favorably for the launch of Crinecerfont when we secure approval.

Operator, Operator

We'll move next to Laura Chico with Wedbush. Your line is open.

Laura Chico, Analyst

Good morning, guys, and congratulations to Kevin. Focusing on ININGREZZA, what needs to happen to provide peak revenue guidance? It appears you have a thorough command of the market; what are the remaining unknowns?

Matthew Abernethy, CFO

Laura, thanks for the question. ININGREZZA is expected to be a significant medicine for patients, and the anticipated large sales number will follow. However, we've never provided peak expectations. This market continues to exceed our and Wall Street's expectations, but we have strong conviction in our continued investment, creating a solid foundation moving forward.

Kyle Gano, Future CEO

Two-thirds of patients still remain undiagnosed with TD, and it’s estimated that 80% of those with tardive dyskinesia aren't being treated with a VMAT2 inhibitor. We see significant opportunity to help many more patients.

Operator, Operator

This concludes our question-and-answer session. I would like to turn it back to Kevin for any closing remarks.

Kevin Gorman, CEO

Thank you very much. I feel as though I should be in my rocking chair right now, but just a few things. This business is a tough one, but it boils down to simplicity. Over the years, we've listened and served our patients. We've also listened and served our shareholders. Contrary to popular belief, these aspects of our industry are not at odds; when done correctly, they reinforce one another and can lead to amazing medicines. The biopharma industry is the most creative, dynamic, and exciting in the world—I can't imagine anything more rewarding. While the biopharma industry is often blamed for healthcare ills, that’s far from the truth. I hope that the positive impact comes through in the coming years. I want to conclude by thanking our investors—both previous and current—and all of you analysts for your years of support. You've challenged me and provided valuable advice, which I hope has made me better. I recognize there is a stake in the patients on your part. It’s been a bumpy road to reach this point, and I’m sure there will be more ups and downs ahead. However, I am certain this team will guide the company to greater success than we’ve ever realized. The best phase of Neurocrine and the patients we strive to assist lies ahead. Thank you.

Operator, Operator

This concludes today's program. Thank you for your participation. You may disconnect at any time and have a wonderful afternoon.