Summary of Alkermes FY Conference Call (December 04, 2025) Company Overview - **Company**: Alkermes (NasdaqGS:ALKS) - **Focus**: Development of Elixirxton, an orexin 2 receptor agonist for the treatment of narcolepsy (NT1 and NT2) and idiopathic hypersomnia (IH) Key Points Industry Context - **Orexin Receptor Agonists**: Emerging therapeutic category for sleep disorders, particularly narcolepsy and hypersomnolence conditions [1][2][3] Clinical Trial Insights - **Vibrance-1 and Vibrance-2 Studies**: - Vibrance-1 data indicates a high probability of Elixirxton's approval for NT1 [4][5] - Vibrance-2 data shows statistically significant and clinically meaningful changes, supporting the drug's potential for NT2 [6][7] - 70% of patients at the 18-milligram dose achieved normalcy on the Epworth Sleepiness Scale (ESS) [30] Efficacy and Potency - **Efficacy Variability**: - NT2 patients exhibit a wide range of responses, complicating efficacy assessments [27][38] - The study revealed that while some patients did not respond on the Maintenance of Wakefulness Test (MWT), they showed improvement on the ESS [28][30] - **Disease Heterogeneity**: - NT2 is viewed as a distinct condition from NT1, necessitating different treatment approaches [33][38] Dosing Strategy - **Dosing Flexibility**: - Alkermes is considering a range of doses for both NT1 and NT2, with potential for split dosing to enhance patient control over wakefulness [49][60] - A once-daily (QD) dose is expected to be a strong anchor, but flexibility for top-up doses may be beneficial [50][54] - **Phase 3 Trials**: - Decisions on dosing for phase 3 trials have been made, with expectations of 40 to 50 patients per arm [170][166] Competitive Landscape - **Comparison with Competitors**: - Alkermes acknowledges the presence of other orexin receptor agonists, particularly from Takeda, and emphasizes the importance of safety and tolerability in their data [144][155] - Alkermes aims to differentiate through dosing flexibility and a broader range of dosing options [163] Safety and Tolerability - **Safety Profile**: - Vibrance-2 confirmed the safety hypothesis, with no dose-limiting toxicities observed at tested doses [132][60] - The drug is expected to be well-tolerated, with mild to moderate side effects that may attenuate over time [154][159] Future Directions - **IH Study Insights**: - Anticipation of similar efficacy in IH patients based on learnings from NT2 studies [178][182] - The study will focus on the signal of wakefulness using the IH Sleep Scale (IHSS) and ESS as primary endpoints [191][198] Role of Oxybates - **Oxybate Products**: - Alkermes sees a continued role for oxybates in the treatment landscape, particularly for patients who prefer nighttime consolidation of sleep [210][218] - The company acknowledges that not all IH patients will require oxybates, but some may benefit from their use [221] Additional Considerations - **Clinical Measurement Tools**: - The Epworth Sleepiness Scale is widely used but may be supplemented with more specific measures of cognition and fatigue in future studies [123][127] - **Market Potential**: - The overall market for orexin receptor agonists is expected to grow, accommodating multiple drugs and treatment options [144][145] This summary encapsulates the key insights from the Alkermes FY Conference Call, highlighting the company's strategic focus on Elixirxton and its implications for the treatment of narcolepsy and hypersomnolence disorders.

Alkermes FY Conference Summary Company Overview - **Company**: Alkermes (NasdaqGS: ALKS) - **Date of Conference**: December 03, 2025 Key Industry Insights - **Hypersomnia Market**: Alkermes is moving aggressively into the hypersomnia market, which is a new commercial domain for the company after years of focus on other areas [2][3] - **Orexin Receptor Agonist Class**: The landscape of the orexin receptor agonist class is becoming clearer, positioning Alkermes favorably within this setting [3] Financial and Strategic Highlights - **Acquisition of Avadel**: Alkermes intends to acquire Avadel, which has $275 million in sales this year and is already profitable. This acquisition is seen as a strategic move to enhance their position in the hypersomnia market [5][15] - **Valuation Methodology**: The valuation of Avadel was assessed through discounted cash flows and the anticipated positive impact on the launch of ALKS 2680 [5][6] - **Gross-to-Net Dynamics**: Alkermes has a strong understanding of gross-to-net dynamics, which is crucial for assessing the commercial value of their products [8][9] Product Development and Pipeline - **ALKS 2680**: This product is expected to be a significant launch for Alkermes, targeting narcolepsy, a rare disease. The anticipated high price point and medical value are highlighted [12][13] - **Cognition Data**: Alkermes claims to be the only company to show significant effects on cognition and fatigue in a randomized controlled study for orexin, which is critical for patient care in narcolepsy [21][22] - **Future Indications**: The company is exploring multiple indications for orexin beyond narcolepsy, with ongoing clinical trials and a focus on patient populations and pricing strategies [27][28] Research and Development (R&D) Strategy - **R&D Funding**: Alkermes aims to fund its orexin program aggressively while maintaining profitability. The company does not foresee financial constraints in pursuing its R&D goals [34][35] - **Clinical Trials**: The company is preparing for phase three trials for narcolepsy, with a robust data set from phase two studies. The timing for these trials is set for Q1 [41][42] Market Position and Competitive Advantage - **Commercial Infrastructure**: The acquisition of Avadel allows Alkermes to leverage existing commercial infrastructure, enhancing market access and compliance without the need to build a new team from scratch [13][15] - **Dosing Flexibility**: Alkermes plans to offer a range of doses for its products, which could provide a competitive advantage in the market by accommodating different patient needs [44] Conclusion - Alkermes is positioned for significant growth in the hypersomnia market through strategic acquisitions and a strong product pipeline. The company emphasizes its understanding of market dynamics and its commitment to maintaining profitability while expanding its R&D efforts.

Core Viewpoint - Alkermes plc reported disappointing earnings and revenue for the first quarter of 2025, missing consensus estimates and showing a decline in total revenues compared to the previous year [1][2]. Financial Performance - Earnings from continuing operations were 13 cents per share, missing the Zacks Consensus Estimate of 28 cents and down from 21 cents per share in the same quarter last year [1]. - Total revenues for the first quarter were $306.5 million, a decrease of 12.5% year over year, and also below the Zacks Consensus Estimate of $317 million [2]. - The proprietary products portfolio generated sales of $244.5 million, up 4.7% year over year, driven primarily by Lybalvi [5][6]. Product Sales Breakdown - Vivitrol sales increased by 3.4% year over year to $101 million, beating the Zacks Consensus Estimate of $99 million but missing the internal estimate of $103.8 million [6]. - Lybalvi generated sales of $70 million, up 22.8% year over year, but missed both the Zacks Consensus Estimate of $71 million and the internal estimate of $75.1 million [7]. - Aristada sales decreased by 6.8% year over year to $73.5 million, missing the Zacks Consensus Estimate of $79 million [7]. Revenue Sources - Manufacturing and royalty revenues fell by approximately 46.9% year over year to $62 million, with specific contributions from Biogen's Vumerity and other products [7][8]. Expenses and Cash Position - Research and development expenses totaled $71.8 million, up 6.2% year over year, while selling, general, and administrative expenses decreased by 4.4% to $171.7 million [9]. - As of March 31, 2025, Alkermes had cash and cash equivalents of $916.2 million, an increase from $824.8 million as of December 31, 2024 [9]. Guidance and Future Outlook - Alkermes reiterated its financial guidance for 2025, expecting total revenues in the range of $1.34 billion to $1.43 billion, with specific sales expectations for Vivitrol, Aristada, and Lybalvi [10]. - Net sales from proprietary products are anticipated to be between $260 million and $280 million in the second quarter of 2025 [11]. Pipeline Development - The company initiated the phase II Vibrance-3 study for ALKS 2680, targeting idiopathic hypersomnia, with primary endpoints focused on sleepiness reduction compared to placebo [12][13]. - Additional studies for ALKS 2680 are ongoing for narcolepsy type 1 and type 2, with data expected in the latter half of 2025 [14].

Financial Data and Key Metrics Changes - The company reported total revenues of $306.5 million for Q1 2025, slightly above expectations, driven by a 5% year-over-year growth in proprietary product sales [17][18] - Net sales from proprietary products were $244.5 million, with a GAAP net income of $22.5 million and adjusted EBITDA of $45.6 million [13][19][20] - The company ended the quarter with $916.2 million in cash and investments, maintaining a strong financial position [20] Business Line Data and Key Metrics Changes - VIVITROL net sales were $101 million, primarily driven by alcohol dependence, which accounts for approximately 75% of its volume [13] - ARISTADA product family generated net sales of $73.5 million, with expectations for 2025 in the range of $335 million to $355 million [13] - LIVALVI saw a 23% year-over-year growth in net sales to $70 million, driven by a 22% increase in TRx growth [13][14] Market Data and Key Metrics Changes - The company noted that Medicaid coverage for its products is approximately 45% to 50% across VIVITROL, LYBOLVI, and ARISTADA [71] - The first quarter performance was slightly ahead of expectations, indicating a solid start to 2025 [15] Company Strategy and Development Direction - The company is focused on maximizing the potential of its commercial products while advancing its Orexin portfolio, particularly the ALKS 2680 Phase II program [8][9] - Strategic investments are being made to drive awareness and uptake of psychiatry franchise products, including an expanded sales force [14] - The company is preparing for key data readouts from the ALKS 2680 Phase II studies later this year, which are expected to provide substantial datasets [16][27] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in navigating the current macroeconomic conditions, highlighting the company's U.S.-based manufacturing and supply chain as advantageous [12][16] - The focus remains on advocating for policies that maintain access to care for patient populations and supporting regulatory work streams [32] - The company anticipates a pivotal year with transformative data expected in the second half of 2025 [11][31] Other Important Information - The company has a remaining share repurchase authorization of $200 million and may opportunistically repurchase shares depending on market conditions [20] - The Phase II studies for ALKS 2680 are advancing with strong momentum, with top-line results expected early in Q3 for the NT1 study [10][11] Q&A Session Summary Question: Update on NT2 study endpoints - The NT2 study has dual primary endpoints of mean wakefulness tests and Epworth Sleepiness Scale due to competitive landscape considerations [36] Question: Contribution of scripts from schizophrenia and bipolar for LIVALVI - The TRx split for LIVALVI is roughly 50/50 between schizophrenia and bipolar, with a trend towards 55% for bipolar in new patient starts [42][44] Question: Safety data from Orexin studies - An independent data safety monitoring board oversees safety across the study, with no modifications required at this time [50] Question: Contribution of volume versus price to sales - The majority of sales expectations are based on volume growth, with Medicaid coverage for products around 45% to 50% [70][71] Question: Future of VIVITROL with potential generic competition - The company believes VIVITROL will not follow a typical generic erosion curve due to its complex manufacturing and market dynamics [102]

Financial Data and Key Metrics Changes - The company reported total revenues of $306.5 million for Q1 2025, slightly ahead of expectations, driven by a 5% year-over-year growth in proprietary product sales [20][21] - Net sales from proprietary products were $244.5 million, with expectations for Q2 net sales in the range of $260 million to $280 million [14][21] - GAAP net income for Q1 was $22.5 million, with adjusted EBITDA of $45.6 million [22][23] Business Line Data and Key Metrics Changes - VIVITROL net sales were $101 million, primarily driven by alcohol dependence, which accounts for approximately 75% of VIVITROL volume [14] - ARISTADA product family net sales were $73.5 million, with expectations for 2025 net sales in the range of $335 million to $355 million [14] - LIVALVI net sales grew 23% year-over-year to $70 million, with underlying TRx growth of 22% [14][15] Market Data and Key Metrics Changes - The company maintains a strong financial position with over $900 million in cash and investments [18] - Approximately 45% to 50% of VIVITROL, LIVALVI, and ARISTADA sales are covered by Medicaid [76] Company Strategy and Development Direction - The company is focused on maximizing the potential of its commercial products and driving growth and profitability [10] - The ALKS 2680 Phase II program is expected to generate substantial datasets for narcolepsy studies, with top-line results anticipated early in Q3 2025 [11][12] - The company is preparing for potential Phase III studies based on the outcomes of the ongoing Phase II studies [31] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in navigating the current macroeconomic conditions, emphasizing the importance of U.S.-based manufacturing and supply chain [19][36] - The company is focused on advocating for policies that maintain access to care for patient populations amid changing regulatory environments [37] Other Important Information - The company has a remaining share repurchase authorization of $200 million and may opportunistically repurchase shares depending on market conditions [23] - The company is advancing its research into new disease areas for orexin-two receptor agonists, with plans to start clinical work this year [26][34] Q&A Session Summary Question: Update on NT2 study endpoints - The NT2 study has dual primary endpoints of mean wakefulness tests and Epworth Sleepiness Scale due to competitive landscape considerations [41][43] Question: Contribution of LIVALVI from schizophrenia and bipolar - LIVALVI TRxs are roughly a 50/50 split between schizophrenia and bipolar, with a trend towards 55% for bipolar in new patient starts [47][48] Question: Safety data from orexin studies - Safety data is monitored by an independent data safety monitoring board, which has not reported any modifications to the study [56] Question: Efficacy definitions for upcoming readouts - Efficacy is assessed through both current market standards and the potential for normal wakefulness during daytime hours [62][63] Question: Future business development and M&A strategy - The company is open to acquiring additional assets that fit its strategy and can add value to its development program [70][71] Question: Impact of Medicaid cuts on VIVITROL - The company is not currently seeing changes in federal funding for VIVITROL, with less than 5% of demand based on government funding [84] Question: Visual disturbances in Vibrance studies - All patients in Phase II programs receive visual exams, and the data safety monitoring board oversees safety across the studies [94]

Core Insights - Alkermes plc reported a total revenue of $306.5 million for Q1 2025, a decrease from $350.4 million in Q1 2024, indicating a year-over-year decline of approximately 12.5% [3][9] - The company achieved a GAAP net income of $22.5 million for Q1 2025, down from $36.8 million in Q1 2024, reflecting a decrease of about 38.8% [4][9] - Alkermes reiterated its financial expectations for 2025, maintaining confidence in its strategic objectives and market position [2][13] Financial Performance - Total proprietary net sales for Q1 2025 were $244.5 million, compared to $233.5 million in Q1 2024, representing an increase of approximately 4.3% [3][23] - Key product revenues included VIVITROL® at $101.0 million, ARISTADA® at $73.5 million, and LYBALVI® at $70.0 million, with LYBALVI® showing a significant growth of 23% year-over-year [3][10][6] - The company reported an adjusted EBITDA of $45.6 million for Q1 2025, down from $81.8 million in Q1 2024, indicating a decline of about 44.3% [4][24] Research and Development - Alkermes completed enrollment in the Vibrance-1 phase 2 study for ALKS 2680, an oral orexin 2 receptor agonist for narcolepsy type 1, with topline results expected in early Q3 2025 [2] - The company is also progressing with the Vibrance-2 and Vibrance-3 phase 2 studies, targeting narcolepsy type 2 and idiopathic hypersomnia, respectively [2] Balance Sheet - As of March 31, 2025, Alkermes reported cash, cash equivalents, and total investments of $916.2 million, an increase from $824.8 million at the end of 2024 [12][25] - Total assets stood at $2.08 billion, with total shareholders' equity of $1.51 billion, reflecting a solid financial position [25]