Group 1 - The article mentions that Anand Chokkavelu, CFA, Karl Thiel, and Keith Speights have no positions in any of the stocks mentioned [1] - The Motley Fool has positions in and recommends Axsome Therapeutics [1] - The Motley Fool has a disclosure policy regarding its investment positions [1]

Summary of Axsome Therapeutics (AXSM) 2025 Conference Call Company Overview - **Company**: Axsome Therapeutics (AXSM) - **Date of Conference**: May 13, 2025 - **Key Speakers**: Mark Jacobsen (COO), Nick Pizzi (CFO), Jason Gerber (Analyst) Key Points Industry and Product Launches - **Avelity (MDD)**: - The company is over two years into the launch and is experiencing a growth trajectory with ongoing initiatives to drive further growth [4][5] - Expansion of the field force to approximately 300 representatives was completed in Q1, expected to impact new prescriptions (NBRx) positively [5][8] - The company anticipates a national patient-provider program (PPP) campaign in the second half of the year to further catalyze growth [6] - **Symbravo (Migraine)**: - Launch is targeted for June 2025, with preparations underway and field force training in progress [36][37] - Peak sales expectations are between $500 million to $1 billion, compared to Avelity's $1 billion to $3 billion for MDD [35] Financial Performance and Projections - **Revenue Growth**: - Revenue growth is outpacing operating expense growth, with expectations for continued operating leverage into 2025 and 2026 [9] - The company is currently at 63% coverage in the commercial space, with a goal to exceed 80% [14][15] - Gross to net (GTN) in Q1 was in the mid-50s, expected to remain constant throughout the year despite seasonality [16] Market Dynamics and Competitive Landscape - **Payer Negotiations**: - The company is pleased with ongoing discussions with payers, aiming for long-term value rather than immediate coverage [13][14] - The efficacy of Avelity is a key factor in negotiations, with a strategy focused on maintaining net pricing [13] - **Market Access**: - Anticipated access in the Medicare Part D channel for Avelity, with expectations of around 70% coverage for total prescriptions [28] - The company is assessing potential targeting in long-term care facilities, which could enhance market penetration [31] Clinical Development and Regulatory Updates - **Alzheimer's Agitation Label Expansion**: - The company is preparing for a supplemental NDA (sNDA) submission in Q3 2025, with positive feedback from the FDA on the clinical program [22][24] - Three positive studies have been completed, supporting the filing [25] - **AXS-12 for Narcolepsy**: - The company plans to file for AXS-12 in the second half of 2025, with a robust clinical data package from multiple studies [47][48] Strategic Considerations - **Long-term Strategy**: - The company emphasizes a long-term approach to product value and market positioning, particularly in the context of evolving payer dynamics and competitive pressures [13][19] - The expansion of the field force is seen as a critical component for enhancing engagement with primary care clinicians [18] Additional Insights - **Market Segmentation**: - The company recognizes the distinct market dynamics for migraine treatments compared to MDD, with different refill patterns and prescribing behaviors [38][39] - There is a focus on ensuring that the product reaches patients effectively, with considerations for market access dynamics and clinician experiences [42][44] Conclusion - Axsome Therapeutics is positioned for growth with strategic initiatives in place for its key products, Avelity and Symbravo. The company is actively engaging with payers and preparing for significant product launches while maintaining a focus on long-term value and market access.

Core Viewpoint - Axsome Therapeutics has secured a $570 million term loan and revolving credit facility from Blackstone, which will significantly reduce interest expenses and enhance financial flexibility [2][3]. Financial Agreement - The new facility includes a $500 million term loan and a $70 million revolving credit facility, with an initial drawdown of $120 million used to retire a previous loan [2][3]. - An additional $250 million can be drawn at the company's option, with another $200 million available pending Blackstone's approval [3]. - The interest rates are set at SOFR variable rate plus 4.75% for the term loan and SOFR variable rate plus 4.0% for the revolving credit facility, maturing in May 2030 with a 60-month interest-only payment period [3]. Strategic Implications - The partnership with Blackstone is expected to enhance Axsome's operational and financial agility, supporting its growth phase and commitment to improving shareholder value [3]. - The financing agreement is seen as a testament to Axsome's commercial success and innovative pipeline, positioning the company favorably within the life sciences sector [3][6]. Company Overview - Axsome Therapeutics focuses on developing treatments for central nervous system disorders, with a portfolio that includes FDA-approved therapies for major depressive disorder, narcolepsy, and migraines [5]. - The company aims to address significant gaps in care and improve patient outcomes through innovative products [5]. Blackstone Overview - Blackstone Life Sciences manages $12 billion in assets and specializes in providing customized financing solutions to biopharma companies [6]. - Blackstone Credit & Insurance is recognized as a leading credit investor, offering capital to strengthen and grow businesses across various credit markets [7].

Axsome Therapeutics (AXSM) Conference Call Summary Company Overview - Axsome Therapeutics is a commercial-stage company focused on Central Nervous System (CNS) indications with several approved products and a broad pipeline [1][2] Key Financial Performance - Q1 2025 net sales reached $120 million, with $96 million from OVALITY (for major depressive disorder) and $25 million from Sunosi [4][5] Product Launches and Pipeline - Symbravo, for acute treatment of migraine, is set to launch next month [5][6] - AXS-05 for Alzheimer's disease agitation is on track for an sNDA submission in Q3 2025 [6][18] - Positive data readouts for solriamfetol in ADHD and major depressive disorder with excessive daytime sleepiness [7][39] Market Adoption and Sales Strategy - OVALITY has over 50% adoption as a first or second-line treatment in major depressive disorder [9] - The sales team has expanded to approximately 300 account managers, with expectations for growth in the commercial channel [10][11] - The company aims for over 80-85% of lives covered in the antidepressant class [11][12] Competitive Advantages - OVALITY is noted for its rapid onset of action, durability, and favorable safety profile compared to traditional antidepressants [14][15] - AXS-05 is differentiated from atypical antipsychotics, which have a black box warning for elderly patients with dementia [23][24] Clinical Development Highlights - Three positive trials completed for AXS-05 in Alzheimer's agitation, with no safety signals for falls or mortality [17][18] - The company is preparing for NDA submissions for AXS-14 (fibromyalgia) and AXS-12 (cataplexy in narcolepsy) [45][46] Future Outlook - Axsome anticipates significant growth and attention as more products come into focus, particularly with ongoing regulatory filings and launches [47][48]

Core Insights - Axsome Therapeutics reported an adjusted loss of $1.22 per share in Q1 2025, which is an improvement from the loss of $1.44 per share in the same quarter last year and better than the Zacks Consensus Estimate of a loss of $1.26 [1] - The company's total revenues increased by 62% year over year to $121.5 million in Q1 2025, surpassing the Zacks Consensus Estimate of $119 million, primarily driven by strong sales of Auvelity [2][5] - Year-to-date, Axsome's shares have increased by 37.7%, contrasting with a 2.2% decline in the industry [4] Financial Performance - Total revenues in Q1 2025 included product revenues from Auvelity and Sunosi, as well as royalty revenues, with net product revenues reaching $120.4 million compared to $74.1 million in the previous year [5] - Auvelity's sales were $96.2 million, reflecting an 80% year-over-year increase, with approximately 167,000 prescriptions recorded, marking a 76% increase from the previous year [6] - Sunosi's net product sales were $25.2 million, up 17% from the prior year, with total prescriptions growing 12% year over year to 46,000 [7] Expenses and Cash Position - Research and development expenses rose to $44.8 million, a 21.7% increase from the previous year, driven by higher costs related to clinical studies [9] - Selling, general, and administrative expenses totaled $120.8 million, up 22% year over year, attributed to increased commercial activities for Auvelity and pre-launch activities for Symbravo [10] - As of March 31, 2025, Axsome had cash and cash equivalents of $300.9 million, down from $315.4 million at the end of 2024 [11] Pipeline Developments - Axsome received positive feedback from the FDA regarding its plans to submit a supplemental new drug application for AXS-05 for agitation in Alzheimer's disease, expected in Q3 2025 [14] - The company plans to initiate a pivotal phase II/III study of Auvelity for smoking cessation later in 2025 and has submitted an NDA for AXS-14 for fibromyalgia treatment [15] - Axsome is also evaluating solriamfetol in phase III studies for ADHD and MDD, with plans to initiate additional studies later in 2025 [17][19] Market Position - Axsome currently holds a Zacks Rank of 3 (Hold), with better-ranked stocks in the biotech sector including ADMA Biologics and Immunocore Holdings, both carrying a Zacks Rank of 2 (Buy) [21]

Financial Performance - Total revenues for Q1 2025 were $121.463 million, a 62% increase from $74.999 million in Q1 2024[16] - Product sales, net for Q1 2025 reached $120.358 million, up from $74.096 million in the same period last year, representing a 62% growth[16] - The net loss for Q1 2025 was $59.413 million, compared to a net loss of $68.357 million in Q1 2024, reflecting a 13% improvement[16] - Operating expenses for Q1 2025 totaled $178.445 million, compared to $142.274 million in Q1 2024, marking a 25% increase[16] - The Company reported a consolidated net loss of $59.4 million for the three months ended March 31, 2025, an improvement from a net loss of $68.4 million in the same period of 2024[178] - The accumulated deficit as of March 31, 2025, was $1,182.2 million, highlighting the ongoing financial challenges faced by the company[194] Cash and Liquidity - Cash and cash equivalents as of March 31, 2025, were $300.910 million, down from $315.353 million at the end of 2024[14] - The Company expects its existing cash of $300.9 million will be sufficient to fund its operating cash requirements for at least twelve months[57] - The Company may utilize public and private equity offerings, debt financings, and strategic alliances to finance future cash needs if market conditions are favorable[32] - The Company must maintain Qualified Cash of at least $30.0 million plus the Qualified Cash A/P Amount, with conditional waivers if market capitalization exceeds $1.5 billion[115] Product Development and Sales - The company launched Symbravo® in January 2025, approved for the acute treatment of migraine, expanding its product portfolio[26] - Axsome Therapeutics has a diverse portfolio of FDA-approved treatments for CNS conditions, addressing over 150 million people in the U.S.[23] - The Company currently has three commercial products: Auvelity, Sunosi, and the recently FDA-approved Symbravo[34] - Product sales, net for Auvelity reached $96.231 million, up 80.0% from $53.395 million in the prior year, while Sunosi sales increased to $24.127 million from $20.701 million[157] - The company expects revenue fluctuations for Auvelity, Sunosi, and Symbravo based on demand, emphasizing the need for successful commercialization of its products[196] Research and Development - Research and development expenses for AXS-05 were $14.5 million for the three months ended March 31, 2025, compared to $13.5 million for the same period in 2024[178] - Research and development expenses for the three months ended March 31, 2025, were $44.8 million, an increase from $36.8 million in 2024, reflecting ongoing investment in product development[208] - The company expects moderate increases in research and development costs as it continues to develop current and future product candidates[212] Revenue Recognition and Accounting - Revenue is recognized when the customer obtains control of a promised good or service, reflecting the consideration expected to be received[36] - The Company generates revenue from license agreements, which may include non-refundable upfront fees and royalties on sales of products[38] - The Company recognizes revenue from product sales net of reserves for variable consideration, which reflects the best estimate of the amount entitled based on contract terms[42] - The Company estimates variable consideration for rebates, discounts, and other incentives based on expected patient usage and inventory levels[44] Debt and Financing - As of March 31, 2025, total outstanding debt was $180.0 million, with an accreted final payment fee of $4.5 million and unamortized debt discount of $3.1 million[122] - The Fifth Amendment to the Loan Agreement increased the Tranche 3 Commitment from $75.0 million to $80.0 million[109] - The aggregate principal amount under the Loan Agreement increased from $300.0 million to $350.0 million[110] Customer Concentration - The company’s three largest customers accounted for approximately 32%, 30%, and 27% of gross product sales for the three months ended March 31, 2025[155] Stock and Compensation - The company had 8,289,857 stock options outstanding with a weighted average exercise price of $48.97 and an intrinsic value of $565,499[140] - The total unrecognized compensation cost related to unvested stock options was $148.8 million, expected to be recognized over a weighted average period of 2.3 years[142] - The company recorded stock-based compensation expense of $23.308 million for the three months ended March 31, 2025, compared to $20.190 million in the same period of 2024[149] Miscellaneous - The Company has not recorded any allowances for doubtful accounts receivable as of March 31, 2025, indicating no significant credit losses historically[73] - The Company has a single operating segment focused on developing therapies for CNS disorders, with financial performance assessed based on consolidated net loss[175] - The Company did not record any income tax expense for the three months ended March 31, 2025 and 2024, maintaining an effective tax rate of 0%[170]

Core Insights - Axsome Therapeutics reported $121.46 million in revenue for Q1 2025, a 62% year-over-year increase, and an EPS of -$0.80, improving from -$1.09 a year ago [1] - The revenue exceeded the Zacks Consensus Estimate of $119.49 million by 1.66%, and the EPS surpassed the consensus estimate of -$1.26 by 36.51% [1] Revenue Breakdown - Royalty revenue was $1.11 million, below the average estimate of $1.40 million from six analysts [4] - Product sales, net totaled $120.36 million, slightly above the average estimate of $117.91 million from six analysts [4] - Product sales for Auvelity reached $96.20 million, exceeding the two-analyst average estimate of $91.65 million [4] - Product sales for Sunosi were $25.20 million, also surpassing the two-analyst average estimate of $24.90 million [4] Stock Performance - Axsome's shares have returned +13.5% over the past month, compared to a +0.4% change in the Zacks S&P 500 composite [3] - The stock currently holds a Zacks Rank 3 (Hold), indicating potential performance in line with the broader market in the near term [3]

Core Insights - Axsome Therapeutics reported a quarterly loss of $0.80 per share, which was better than the Zacks Consensus Estimate of a loss of $1.26, representing an earnings surprise of 36.51% [1] - The company achieved revenues of $121.46 million for the quarter ended March 2025, exceeding the Zacks Consensus Estimate by 1.66% and showing a significant increase from $75 million in the same quarter last year [2] - Axsome has consistently surpassed consensus EPS and revenue estimates over the last four quarters [2] Financial Performance - The company has shown a loss improvement from $1.09 per share a year ago to the current loss of $0.80 per share [1] - Axsome's stock has increased by approximately 32.6% since the beginning of the year, contrasting with a -3.3% decline in the S&P 500 [3] Future Outlook - The current consensus EPS estimate for the upcoming quarter is -$1 on revenues of $139.97 million, and for the current fiscal year, it is -$2.72 on revenues of $616.42 million [7] - The Zacks Rank for Axsome is currently 3 (Hold), indicating expected performance in line with the market in the near future [6] Industry Context - The Medical - Biomedical and Genetics industry, to which Axsome belongs, is currently ranked in the top 34% of over 250 Zacks industries, suggesting a favorable outlook compared to lower-ranked industries [8] - Another company in the same industry, Apellis Pharmaceuticals, is expected to report a quarterly loss of $0.36 per share, reflecting a year-over-year change of +33.3% [9]

Financial Performance & Pipeline - Axsome reported a total net product revenue of $121.5 million in 1Q 2025, representing a 62% year-over-year growth compared to 1Q 2024[16] - AUVELITY net product sales reached $96.2 million in 1Q 2025, reflecting an 80% year-over-year growth[16, 18] - SUNOSI net product revenue was $25.2 million in 1Q 2025, a 17% increase year-over-year[16, 18] - The company's cash and cash equivalents stood at $300.9 million as of March 31, 2025, expected to fund operations into cash flow positivity[16] - Axsome anticipates peak sales potential of $16.5 billion driven by current commercial and late-stage assets[13] Regulatory & Clinical Milestones - SYMBRAVO was approved in the U S for the acute treatment of migraine in January 2025, with commercial launch anticipated in June 2025[16, 17, 23] - An NDA for AXS-14 for fibromyalgia was submitted to the FDA[16] - A supplemental NDA submission for AXS-05 in Alzheimer's disease agitation is on track for 3Q 2025[16, 61] - An NDA submission for AXS-12 for cataplexy in patients with narcolepsy is anticipated in 2H 2025[16, 96] - Positive topline results were announced for the FOCUS Phase 3 trial of solriamfetol in ADHD and the EMERGE Phase 3 trial of SYMBRAVO in oral CGRP non-responders[16, 70] Market & Therapeutic Areas - Approximately 7 million people in the U S are affected by Alzheimer's disease[56] - Agitation is reported in approximately 70% of people with Alzheimer's disease[58] - An estimated 22 million people in the U S are affected by ADHD, including approximately 7 million children aged 3-17 years old[7, 67] - Approximately 17 million people in the U S are affected by fibromyalgia[7, 101]

Financial Data and Key Metrics Changes - Total product revenues for Q1 2025 were $121.5 million, representing a year-over-year growth of 62% compared to $75 million in Q1 2024 [18][21] - Net loss for Q1 2025 was $59.4 million or $1.22 per share, an improvement from a net loss of $68.4 million or $1.44 per share in Q1 2024 [21] - Cash and cash equivalents at the end of Q1 2025 were $300.9 million, down from $315.4 million at year-end [21] Business Line Data and Key Metrics Changes - Avelity net product sales were $96.2 million for Q1 2025, representing 80% year-over-year growth from $53.4 million in Q1 2024 [18] - Sunosi net product revenues were $25.2 million for Q1 2025, a 17% year-over-year growth from $21.6 million in Q1 2024 [18] Market Data and Key Metrics Changes - Avelity led the market in TRx growth in Q1 with approximately 167,000 prescriptions, reflecting 76% year-over-year growth [23] - Sunosi total prescriptions were over 46,000, representing a 12% growth versus Q1 2024 [25] Company Strategy and Development Direction - The company aims to advance three novel NDA stage product candidates: AXS-fourteen for fibromyalgia, AXS-five for Alzheimer's disease agitation, and AXS-twelve for narcolepsy [8][12] - The company is focused on executing multiple Phase III clinical programs to broaden the potential of current products and candidates [8][14] - The company anticipates a strong position with potentially five marketed products across six indications by 2026 [17] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's ability to navigate trade policy developments, stating that any potential impact would be immaterial [15] - The company expects 2025 to be a catalyst-rich year with significant updates on product launches and clinical trials [17] Other Important Information - The company is preparing for the launch of Cymbravo, with positive feedback from healthcare providers regarding its clinical profile [26] - The company is actively negotiating to expand payer coverage for Avelity and Sunosi [68] Q&A Session Summary Question: FDA interactions regarding developmental agents - Management indicated that dialogue with the FDA remains status quo and no changes have been noted regarding review teams or agency responsiveness [32] Question: DTC advertising for Avelity - A national campaign is expected to launch later this year [35] Question: Coverage evolution for Avelity - Management is focused on increasing covered lives and reducing utilization management [68] Question: Expected cadence of coverage for Cymbravo - Management stated it is premature to specify the cadence but is focused on securing access quickly [48] Question: Sales opportunity for AXS-fourteen in fibromyalgia - Management is enthusiastic about the potential impact, given the large market size and lack of recent therapeutic innovation [62] Question: Profitability expectations for 2025 - Management remains confident in achieving cash flow positivity but has not provided specific guidance on profitability [94]