Summary of Alkermes Conference Call Company Overview - **Company**: Alkermes - **Event**: 2026 TD Cowen Healthcare Conference - **Key Speaker**: Richard Pops, Chairman and CEO Industry Focus - **Primary Industry**: Sleep Medicine - **Key Products**: Alixorexton, LUMRYZ, Avadel acquisition Core Points and Arguments 1. **Business Transition**: Alkermes has undergone significant changes in 2025, solidifying its position in the sleep medicine market, particularly with the orexin franchise and the acquisition of Avadel [2][3] 2. **Market Position**: The company is now a major player in the sleep medicine market, preparing for the launch of alixorexton, supported by a strong and cash-generative base business [3] 3. **Acquisition Rationale**: The acquisition of Avadel was strategic, enhancing the company's presence in sleep centers and preparing for the alixorexton launch, which is expected to shift the launch curve positively [4][7] 4. **Unmet Needs in Narcolepsy**: There is a significant gap between the prevalence of narcolepsy (approximately 200,000 patients in the U.S.) and those treated (about 80,000), indicating a large market opportunity [15] 5. **Orexin Compounds**: The company is investigating the ideal dosing for orexin agonists, with promising data from Phase 2 studies indicating safety and efficacy [17][18] 6. **Phase 3 Program**: Alkermes is initiating a Phase 3 program with three studies focused on NT-1 and NT-2, with primary endpoints including the Maintenance of Wakefulness Test (MWT) and Epworth Sleepiness Scale (ESS) [24][25] 7. **Cognitive and Fatigue Outcomes**: The company has observed significant improvements in cognitive complaints and fatigue in patients, which are critical for treatment success [56][57] Additional Important Content 1. **Base Business Strength**: Alkermes has transformed from a royalty-based business to a proprietary products business, with expectations of $1.4 billion from proprietary products in 2026 [59][60] 2. **Commercial Strategy**: The acquisition of Avadel is expected to broaden the commercial portfolio and increase profitability, allowing for aggressive investment in the pipeline [60][61] 3. **Future Opportunities**: Alkermes is exploring additional indications for orexin drugs, including ADHD and fatigue, with initial proof of concept data expected soon [46][48] 4. **Side Effect Profile**: The orexin compounds have a mild to moderate side effect profile, with insomnia being the most common, which tends to diminish over time [39][40] 5. **Business Development**: The company is open to tuck-in business development deals that leverage its clinical and scientific capabilities but is currently focused on executing its late-stage and earlier-stage programs [63][64] This summary encapsulates the key points discussed during the conference call, highlighting Alkermes' strategic direction, market opportunities, and product development plans.

Core Insights - Alkermes reported revenue of $384.55 million for the quarter ended December 2025, reflecting a year-over-year decline of 10.6% and an EPS of $0.46, down from $1.04 in the same quarter last year. The revenue exceeded the Zacks Consensus Estimate by 1.21% while the EPS surpassed the consensus estimate by 7.8% [1] Revenue Breakdown - Manufacturing and Royalty revenues were reported at $69.06 million, falling short of the average estimate of $71.23 million by six analysts, representing a year-over-year decline of 43.5% [4] - Product sales, net, amounted to $315.49 million, slightly above the average estimate of $310.64 million, showing a year-over-year increase of 2.5% [4] - Proprietary Sales for VIVITROL reached $124.1 million, exceeding the estimated $122.43 million, but reflecting a decline of 7.5% compared to the previous year [4] - Manufacturing and Royalty Revenues for VUMERITY were reported at $27.62 million, significantly lower than the average estimate of $34.83 million, marking a year-over-year decrease of 21.1% [4] - Proprietary Sales for ARISTADA were $97.2 million, surpassing the average estimate of $93.77 million, with a year-over-year change of 0.6% [4] - Proprietary Sales for LYBALVI reached $94.1 million, slightly above the average estimate of $93.91 million, indicating a year-over-year increase of 22.2% [4] Stock Performance - Alkermes shares have returned -0.4% over the past month, compared to a -0.3% change in the Zacks S&P 500 composite, with the stock currently holding a Zacks Rank 3 (Hold), suggesting it may perform in line with the broader market in the near term [3]

Core Insights - The company is preparing for potential generic competition for VIVITROL in 2027, with manufacturing complexity seen as a barrier to entry for competitors [1] - The expiration of Zeppelin royalties in late 2026 is anticipated to negatively impact manufacturing and royalty revenue streams [1] - A significant non-cash inventory step-up charge of $150 million related to LUMRIZE will affect GAAP results in 2026, but not adjusted EBITDA [2] - R&D investment is projected to rise to between $445 million and $485 million to support new trials in narcolepsy, ADHD, and fatigue [2] - The 2026 revenue guidance is set between $1.73 billion and $1.84 billion, factoring in a 10.5-month contribution from LUMRIZE and the phase-out of certain INVEGA royalties [3] Management and Strategy - A leadership transition is planned for Summer 2026, with COO Blair Jackson taking over, attributed to the company's strong financial position [4] - The company is shifting its R&D focus towards 'translational' studies in ADHD and fatigue, aiming to validate the orexin pathway's utility beyond sleep disorders [4] - The acquisition of Avadel is viewed as a strategic move to enhance revenue through LUMRIZE and to establish a commercial platform for future orexin product launches [6] Product Development and Market Position - The orexin 2 receptor agonist portfolio is seen as a new growth area, with elixorexant positioned as a potential blockbuster for hypersomnia treatment [5] - The Phase 3 'Brilliance' program for elixorexant in narcolepsy is set to begin in Q1 2026, featuring both once-daily and split-dosing regimens [3][7] - Management believes that offering both dosing options will differentiate elixorexant in the market [8] Competitive Landscape - The company does not expect orexin agonists to fully cannibalize the oxybate market, as they target different aspects of narcolepsy [14] - Current payer access for LUMRIZE exceeds 90% for commercial patients, with no significant changes observed following recent generic launches [14] - Management anticipates that indirect pricing pressure may arise later in the year but remains confident in LUMRIZE's differentiated profile [14]

Core Viewpoint - Alkermes is positioning itself for growth in 2026 following a strong performance in 2025, with a focus on expanding its commercial platform and advancing its orexin pipeline, particularly through the recent acquisition of Avadel and the development of alixorexton [5][21]. Financial Performance - For 2025, Alkermes reported GAAP net income of $241.7 million and adjusted EBITDA of $394.0 million, ending the year with $1.3 billion in cash and total investments [2]. - Total revenues for 2025 were nearly $1.5 billion, driven by proprietary product net sales of approximately $1.2 billion, which grew 9% year over year [4]. Revenue Guidance for 2026 - Alkermes guided total revenues for 2026 between $1.73 billion and $1.84 billion, with proprietary product net sales expected to be between $1.52 billion and $1.60 billion [1]. - Manufacturing and royalty revenues are projected to be between $210 million and $240 million, reflecting the expiration of certain XEPLION royalties [1]. Expense Management - Cost of goods sold for 2026 is expected to be between $365 million and $385 million, influenced by purchase price accounting for LUMRYZ inventory [6]. - R&D expenses are projected to be between $445 million and $485 million, while SG&A expenses are expected to be between $890 million and $930 million, including one-time transaction costs related to the Avadel acquisition [7]. Product Performance - VIVITROL net sales for 2025 were $467.9 million, with a guidance of $460 million to $480 million for 2026 [10]. - ARISTADA net sales were $370.0 million in 2025, with a guidance of $365 million to $385 million for 2026 [11]. - LYBALVI saw a 24% increase in net sales to $346.7 million in 2025, with a guidance of $380 million to $400 million for 2026 [12]. - LUMRYZ generated approximately $279 million in net sales in 2025, with a guidance of $350 million to $370 million for 2026 [13]. Pipeline Developments - Alixorexton is expected to enter phase III trials in narcolepsy, with a detailed program planned [15][16]. - The company is also advancing two additional orexin 2 receptor agonists in phase I studies, with plans for further development in ADHD and fatigue associated with multiple sclerosis and Parkinson's disease [18]. Leadership Transition - A leadership transition is underway, with CEO Richard Pops set to step down and COO Blair Jackson taking over, while Pops will remain as chairman [21].

Financial Data and Key Metrics Changes - In 2025, total revenues reached nearly $1.5 billion, with a year-over-year growth of 9% driven primarily by proprietary products generating approximately $1.2 billion in net sales [9][10] - GAAP net income for the year was $241.7 million, with adjusted EBITDA of $394 million [11][18] - The company ended the year with $1.3 billion in cash and total investments [12] Business Line Data and Key Metrics Changes - VIVITROL net sales were $467.9 million, reflecting a 2% growth year-over-year [24] - ARISTADA net sales reached $370 million, showing a 7% growth year-over-year [26] - LYBALVI net sales grew 24% year-over-year to $346.7 million [27] - LUMRYZ generated approximately $279 million in net sales in 2025, with around 3,500 patients on therapy by year-end [30] Market Data and Key Metrics Changes - The company expects total revenues for 2026 to be in the range of $1.73 billion to $1.84 billion, driven primarily by proprietary products [13][14] - Manufacturing and royalty revenues for 2026 are anticipated to be between $210 million and $240 million [15] - The estimated market for oxybate-eligible patients with narcolepsy is around 50,000, indicating significant growth potential for LUMRYZ [32] Company Strategy and Development Direction - The acquisition of Avadel is seen as a strategic milestone, enhancing the company's entry into the commercial sleep medicine market and providing a platform for launching alixorexton [6][12] - The company plans to initiate the phase III Brilliance program for alixorexton in narcolepsy, with expectations of significant advancements in treatment [34] - The focus remains on operational discipline, efficient capital allocation, and investing in high-potential growth drivers, particularly in the orexin portfolio [23] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's strong financial position and the potential for growth in 2026, emphasizing the importance of the Avadel acquisition [12][23] - The company is committed to delivering shareholder growth and maintaining a strong cash flow positive profile despite expected GAAP net losses due to accounting for the acquisition [18] - Management highlighted the importance of ongoing clinical trials and the potential for alixorexton to transform narcolepsy management [40] Other Important Information - The company plans to initiate a multi-dose phase Ib study for ALKS 7290 in ADHD and a phase IIa study for ALKS 4510 in fatigue associated with neurodegenerative disorders [38][39] - The transition of CEO leadership from Richard Pops to Blair Jackson is set to occur in the summer, with Pops continuing as chairman [40] Q&A Session Summary Question: Phase III trial design and AE profile - Management indicated that the orexin 2 receptor agonists are generally well tolerated, and the split dosing is designed to maximize efficacy while minimizing side effects [44][46] Question: Potential synergies from Avadel acquisition - The integration of the Avadel commercial team is progressing well, with expectations of future synergies as the company prepares to launch alixorexton [48][49] Question: Evidence needed for payer reimbursement for both oxybates and orexin agonists - Management believes that both treatments will be important for certain patients, and they plan to generate data to support reimbursement for this cohort [51][52] Question: Internal bar for ESS in LUMRYZ phase III - Management expects the data from the IH study to mirror previous successful programs, with key secondaries being important for prescriber confidence [56][60] Question: Current understanding of NT1 versus NT2 and IH dynamics - Management noted that the narcolepsy market represents a significant opportunity, with ongoing efforts to understand the IH market better [66]

Fourth Quarter and Year-End 2025 Financial Results & Business Update February 25, 2026 Forward-Looking Statements and Non-GAAP Financial Information Certain statements set forth in this presentation constitute "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995, as amended, including, but not limited to, statements concerning: Alkermes plc's (the "Company") expectations with respect to its current and future financial, commercial and operating performance, ...

Core Insights - Alkermes (ALKS) is expected to report quarterly earnings of $0.43 per share, a decline of 58.7% year-over-year, with revenues forecasted at $379.96 million, reflecting an 11.6% decrease compared to the same period last year [1] Earnings Estimates - The consensus EPS estimate has been revised down by 152.2% over the last 30 days, indicating a significant reevaluation by analysts [2] - Revisions to earnings estimates are crucial indicators for predicting investor actions regarding the stock, with empirical research showing a strong correlation between earnings estimate trends and short-term stock performance [3] Revenue Projections - Analysts predict 'Revenues- Product sales, net' to be $310.64 million, indicating a 1% increase from the prior-year quarter [5] - 'Revenues- Manufacturing and Royalty revenues' are expected to reach $71.23 million, reflecting a 41.7% decrease from the year-ago quarter [5] - 'Revenues- Proprietary Sales- LYBALVI' is estimated at $93.91 million, suggesting a 22% year-over-year increase [6] - 'Revenues- Manufacturing and Royalty Revenues- Long-acting INVEGA products' are projected at $27.82 million, indicating a 23.8% decrease from the prior-year quarter [6] - 'Revenues- Manufacturing and Royalty Revenues- VUMERITY' is forecasted to be $34.83 million, reflecting a 0.4% decrease year-over-year [7] - 'Revenues- Proprietary Sales- ARISTADA' is estimated at $93.77 million, indicating a 3% decrease from the prior-year quarter [7] - 'Revenues- Proprietary Sales- VIVITROL' is expected to be $122.43 million, reflecting an 8.7% decrease from the prior-year quarter [8] Stock Performance - Alkermes shares have shown a return of -2.8% over the past month, compared to a -1% change in the Zacks S&P 500 composite, with a Zacks Rank of 3 (Hold), suggesting that ALKS is expected to mirror overall market performance in the near future [8]

Core Insights - Alkermes plc reported strong financial results for Q3 2025, with revenues of $394.2 million, a 4% increase from $378.1 million in Q3 2024 [3][4] - The company achieved a GAAP net income of $82.8 million, with diluted earnings per share of $0.49 [3][20] - Alkermes raised its financial expectations for 2025, indicating positive momentum in its business operations [2][7] Financial Performance - Total revenues for the nine months ended September 30, 2025, were $1,091.4 million, compared to $1,127.6 million for the same period in 2024 [3] - Proprietary net sales for Q3 2025 were $317.4 million, up from $273.0 million in Q3 2024, marking a 16% increase [3][5] - Key product sales included VIVITROL at $121.1 million (up 7%), ARISTADA at $98.1 million (up 16%), and LYBALVI at $98.2 million (up 32%) compared to Q3 2024 [3][5] Profitability Metrics - GAAP net income from continuing operations was $82.8 million for Q3 2025, down from $92.8 million in Q3 2024 [3][20] - Adjusted EBITDA for Q3 2025 was $121.5 million, compared to $134.3 million in Q3 2024 [3][21] - The company reported a total operating income of $89.1 million for Q3 2025, down from $104.8 million in Q3 2024 [3][20] Research and Development - Alkermes advanced its development pipeline, particularly in the orexin 2 receptor agonist program, with positive data from the Vibrance-1 study for narcolepsy type 1 [2] - The company plans to initiate its phase 3 clinical program for alixorexton in early 2026, which is expected to be a significant growth driver [2] Updated Financial Guidance - Alkermes updated its 2025 financial expectations, raising total revenue guidance to $1,430 – $1,490 million from the previous range of $1,340 – $1,430 million [7][8] - The updated expectations for VIVITROL net sales increased to $460 – $470 million, ARISTADA net sales to $360 – $370 million, and LYBALVI net sales to $340 – $350 million [8]

Core Insights - Alkermes reported revenue of $390.66 million for the quarter ended June 2025, reflecting a year-over-year decline of 2.1% and an EPS of $0.52 compared to $0.72 a year ago, exceeding the Zacks Consensus Estimate of $338.57 million by 15.38% and delivering an EPS surprise of 26.83% [1] Revenue Breakdown - Manufacturing and Royalty revenues were $83.42 million, surpassing the average estimate of $61.5 million, but showing a year-over-year decline of 35.8% [4] - Product sales, net, reached $307.24 million, exceeding the estimated $276.98 million and representing a year-over-year increase of 14.1% [4] - Proprietary Sales for VIVITROL amounted to $121.7 million, above the estimated $111.47 million, marking an 8.8% increase year-over-year [4] - Proprietary Sales for ARISTADA were $101.3 million, exceeding the average estimate of $84.2 million, with a year-over-year growth of 17.8% [4] - Proprietary Sales for LYBALVI reached $84.3 million, compared to the estimated $79.41 million, reflecting an 18.1% year-over-year increase [4] - Manufacturing and Royalty Revenues for VUMERITY were $39.4 million, surpassing the estimated $27.92 million, with an 11.9% year-over-year increase [4] Stock Performance - Alkermes shares have returned -8.6% over the past month, contrasting with the Zacks S&P 500 composite's +3.6% change, and the stock currently holds a Zacks Rank 3 (Hold), indicating potential performance in line with the broader market [3]

Financial Data and Key Metrics Changes - The company reported total revenues of $390.7 million for Q2 2025, with proprietary product net sales of $307.2 million, reflecting a 14% year-over-year growth [12][14] - GAAP net income was $87.1 million, with EBITDA of $101.6 million and adjusted EBITDA of $126.5 million for the second quarter [14] - The company ended the quarter with $1.05 billion in cash and total investments, maintaining a strong financial position [14] Business Line Data and Key Metrics Changes - VIVITROL net sales were $121.7 million, driven by growth in the alcohol dependence indication market [17] - ARISTADA net sales reached $101.3 million, with encouraging leading indicators related to underlying demand [17] - LYBALBI net sales grew 18% year-over-year to $84.3 million, with underlying TRx growth of 22% [18] Market Data and Key Metrics Changes - The proprietary product portfolio's net sales exceeded expectations, driven by strong end market demand and favorable gross to net dynamics [17] - The company anticipates Q3 net sales from the proprietary product portfolio in the range of $280 million to $300 million [12] Company Strategy and Development Direction - The company is focused on accelerating future growth through development candidates in its pipeline, particularly in the orexin portfolio [6][34] - The successful results from the Vibrance one Phase II study of elixorextin are seen as a critical step in the development of the orexin portfolio [7][10] - The company plans to advance additional orexin candidates into clinical development later this year [10] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in achieving record revenues from proprietary products in 2025, anticipating performance towards the higher end of previously issued financial expectations [14][34] - The management highlighted the importance of the positive Vibrance one data as a significant stride forward for the elixorexin development program [33] Other Important Information - The company has a remaining share repurchase authorization of $200 million and may opportunistically repurchase shares depending on market conditions [14] - The company is preparing for key regulatory interactions and plans to initiate a global Phase III program in narcolepsy following the top line data from the narcolepsy type two study [22][34] Q&A Session Summary Question: Focus on visual adverse events with the Orexin program - Management acknowledged the focus on visual AEs from Wall Street and emphasized the importance of the rigorous ophthalmic exams conducted during the study [39][40] Question: Efficacy of elixorextin compared to Takeda's program - Management expressed confidence in the competitive advantage of elixorextin's dosing range and efficacy, awaiting further data from ongoing studies [48] Question: Regulatory path and potential registrational trials - Management indicated that the NT2 study data will be crucial for discussions with the FDA regarding the Phase III design [51][52] Question: Dose response and statistical analysis - Management confirmed the use of negative binomial analysis for cataplexy data and expressed confidence in the clarity of the cataplexy signal [62][63] Question: Potency selectivity of elixorextin - Management confirmed that elixorextin is 5,000-fold more selective towards the orexin 2 receptor over the orexin 1 receptor [70] Question: Safety profile extrapolation to follow-on compounds - Management noted that while similarities are expected due to the same receptor targeting, different pharmacokinetic profiles may lead to variations in safety profiles [74][75] Question: Dosing flexibility in Phase III - Management stated that dosing decisions for Phase III will be informed by the comprehensive data from the Phase II studies [82][110]