Core Insights - The healthcare sector underperformed in 2025, but there are still solid investment opportunities in smaller biotech companies [1] - Axsome Therapeutics and Exelixis are highlighted as promising investment options for 2026 and beyond [2] Axsome Therapeutics - Axsome Therapeutics has made steady clinical and regulatory progress, with approved products including Auvelity for depression, Symbravo for migraines, and Sunosi for narcolepsy [3] - The company is close to earning approval for Auvelity in treating Alzheimer's disease agitation, which could address a significant unmet need, as approximately 5 million patients in the U.S. experience this condition [4] - Axsome's revenue for the first nine months of 2025 reached $442.5 million, marking a 65.8% increase year-over-year [7] - The company has several late-stage pipeline candidates, including AXS-12 for narcolepsy and AXS-14 for fibromyalgia, which could further boost revenue [6][8] Exelixis - Exelixis specializes in oncology, primarily generating revenue from Cabometyx, which is approved for various cancers, including liver and kidney cancer [9] - The company reported $1.7 billion in revenue for the first nine months of 2025, a 7.5% increase compared to the same period in 2024 [10] - Exelixis has successfully defended its patent rights, delaying generic competition until the next decade [10] - The company is developing new products, including Zanzalintinib for metastatic colorectal cancer, which has shown strong phase 3 results and could significantly impact sales [12][14] - Exelixis is expected to submit regulatory applications soon, which will help diversify its portfolio beyond Cabometyx [13]

Core Viewpoint - Axsome Therapeutics has received priority review designation from the FDA for its AXS-05 application aimed at treating agitation in Alzheimer's disease, with a target action date set for April 30, 2026, leading to a significant stock price increase of 22.75% and a market capitalization of $9.2 billion [1][3]. Group 1: Company Overview - Axsome Therapeutics (NASDAQ: AXSM) is a biopharmaceutical company focused on treating central nervous system (CNS) diseases, with AXS-05 being a key product under review for Alzheimer's agitation [3][5]. - The company was founded by Herriot Tabuteau, who has a background in both medicine and finance, allowing for a unique perspective on project evaluation [6][8]. - Axsome's growth strategy targets the significant unmet medical needs in CNS disorders, with an estimated 150 million people in the U.S. affected by conditions like depression and Alzheimer's [9]. Group 2: Product Development and Financials - AXS-05 is a novel oral investigational drug combining dextromethorphan and bupropion, currently in development for treating agitation in Alzheimer's disease and smoking cessation [5]. - The company has not yet achieved profitability, reporting a net loss of $247 million for the 12 months ending June 2025, but has generated $495 million in revenue, reflecting a 70% year-over-year increase [10]. - The company aims to push five new drugs to approval by 2028, with peak sales potential for its existing product portfolio estimated at $16.5 billion [10]. Group 3: Key Products and Market Position - Auvelity, Axsome's flagship antidepressant, shows rapid efficacy within one week, contrasting with traditional antidepressants that take 6-8 weeks, leading to a stock surge of 65% post-approval [11]. - The company executed a strategic acquisition of Sunosi for $53 million, later recouping $66 million by transferring rights in Europe and the Middle East, showcasing effective financial maneuvering [11]. - The upcoming AXS-05 approval could fill a significant market gap for treating agitation in Alzheimer's, addressing the limitations of current antipsychotic medications [11].

Core Viewpoint - Axsome Therapeutics reported a wider-than-expected loss in Q3 2025, but revenues surged significantly due to strong sales of its drug Auvelity, raising questions about the sustainability of this positive trend leading up to the next earnings release [2][3][12]. Financial Performance - Axsome incurred a loss of $0.94 per share in Q3 2025, which was wider than the Zacks Consensus Estimate of a loss of $0.82, compared to a loss of $1.34 per share in the same quarter last year [2]. - Total revenues increased by 63% year-over-year to $171 million, surpassing the Zacks Consensus Estimate of $164 million, primarily driven by strong Auvelity sales [3][4]. - Net product revenues reached $169.8 million, reflecting a 63.7% year-over-year increase, while royalty revenues totaled $1.2 million [4]. Product Sales Breakdown - Auvelity sales amounted to $136.1 million, marking a 69% year-over-year increase and a 14% sequential increase, with approximately 209,000 prescriptions recorded, a 46% increase year-over-year [5]. - Sunosi's net product sales were $32.8 million, up 35% from the previous year, with total prescriptions growing 12% year-over-year [6]. - Symbravo generated $2.1 million in sales in its first full quarter since launch [6]. Expenses and Cash Position - Research and development expenses decreased by 11.5% year-over-year to $40.2 million, attributed to the completion of label expansion studies for Sunosi [7]. - Selling, general, and administrative expenses rose by 57.1% year-over-year to $150.2 million due to increased commercial activities for Auvelity and ongoing launch activities for Symbravo [7]. - As of September 30, 2025, Axsome had cash and cash equivalents of $325.3 million, up from $303 million as of June 30, 2025 [8]. Market Sentiment and Estimates - Recent estimates for Axsome have trended downward, with a consensus estimate shift of -23.81% [9]. - The stock has a Growth Score of A but lags in Momentum with an F, resulting in an aggregate VGM Score of C [11]. - Axsome holds a Zacks Rank 3 (Hold), indicating expectations for an in-line return in the coming months [12]. Industry Comparison - Axsome operates within the Zacks Medical - Biomedical and Genetics industry, where Gilead Sciences reported revenues of $7.77 billion, reflecting a 3% year-over-year increase [13]. - Gilead's expected earnings for the current quarter indicate a -2.1% change from the previous year, with a Zacks Rank 3 (Hold) and a VGM Score of A [14].

Axsome Therapeutics FY Conference Summary Company Overview - **Company**: Axsome Therapeutics (NasdaqGM:AXSM) - **Event**: FY Conference held on November 10, 2025 Key Points Industry and Market Performance - Axsome Therapeutics operates in the biotechnology sector, focusing on treatments for mental health and neurological disorders [1] - The company reported a strong Q3 performance with total net sales of **$171 million**, driven by their leading product for Major Depressive Disorder (MDD) which generated **$136 million**, reflecting a **69% year-over-year growth** and **14% quarter-over-quarter growth** [4][5] Product Pipeline and Development - Axsome has several products in various stages of development: - **AXS-05** for MDD - **AXS-12** for narcolepsy - Ongoing Phase III programs for other indications [3] - The company is expanding its earlier stage pipeline and has launched a direct-to-consumer (DTC) campaign to enhance product visibility [3][5] Direct-to-Consumer Campaign - The DTC campaign launched in early September has already shown positive early metrics, including increased Google searches and new prescriptions (NBRxs) [8][10] - NBRxs increased from **2,000 per week** to **2,800**, attributed largely to the DTC efforts [9][10] - The company is taking a disciplined approach to DTC spending, ensuring that sales in Q4 will meet or exceed the additional DTC expenditures [11][12] Market Access and Sales Force Expansion - Axsome has improved its gross-to-net dynamics, achieving a discount in the high **40s%** and covering **85% of total lives** [18][19] - The sales force currently consists of **300 representatives**, with plans for expansion upon receiving approval for additional indications [20][21] Regulatory and Approval Process - Axsome is preparing for an NDA submission for Alzheimer's Disease Agitation (ADA), with a robust package that includes three positive controlled trials and a standalone safety database [24][25] - The company has received breakthrough therapy designation and is eligible for priority review, although they are modeling a standard review timeline [32][33] Competitive Landscape - The market for Alzheimer's Disease treatments is evolving, with competitors like Rexulti showing growth rates of **20% to 25%** [39][40] - Despite the presence of approved products, a significant portion of patients are still treated off-label, indicating room for growth in formalized treatment protocols [42][43] Financial Outlook - Axsome achieved cash flow positivity for the first time, with approximately **$1 million** positive cash flow from operations in Q3 [60] - The company anticipates operating leverage moving into Q4 and next year, with revenue growth of **14%** and operating expenses growing at **5.5%** [61] Future Projections - Axsome projects peak sales for its products, including **$500 million to $1 billion** for Cymbravo and **$300 million to $500 million** for Sunosi [51][57] - The company is focused on maintaining a disciplined approach to its investments while preparing for potential growth in the ADA market [58][61] Conclusion - Axsome Therapeutics is positioned for significant growth with a strong product pipeline, effective marketing strategies, and a disciplined financial approach. The upcoming regulatory submissions and market expansions are critical to the company's future success.

Core Insights - Axsome Therapeutics reported a loss of $0.94 per share in Q3 2025, which was wider than the expected loss of $0.82, but an improvement from the loss of $1.34 per share in the same quarter last year [1][6] - Total revenues increased by 63% year over year to $171 million, surpassing the consensus estimate of $164 million, driven by strong sales of Auvelity [2][6] Financial Performance - Product revenues reached $169.8 million in Q3, reflecting a 63.7% year-over-year increase, while royalty revenues were $1.2 million [4] - Auvelity sales amounted to $136.1 million, up 69% year over year, with approximately 209,000 prescriptions recorded, marking a 46% increase from the previous year [5][6] - Sunosi generated net product sales of $32.8 million, a 35% increase from the prior year, with total prescriptions growing 12% year over year [7] Expenses and Cash Position - Research and development expenses were $40.2 million, down 11.5% from the previous year, while selling, general, and administrative expenses rose 57.1% to $150.2 million [9] - As of September 30, 2025, the company had cash and cash equivalents of $325.3 million, up from $303 million as of June 30, 2025 [10] Pipeline Developments - Axsome is conducting label expansion studies for Auvelity and has filed a supplemental new drug application for AXS-05 for Alzheimer's agitation [11] - The company plans to initiate pivotal studies for AXS-05 in smoking cessation and has multiple candidates in development for various CNS disorders, including AXS-12 and AXS-14 [12][13] - Solriamfetol is being evaluated in phase III studies for ADHD and MDD, with top-line data expected in 2026 for binge eating disorder and shift work disorder [14][15] Market Performance - Year to date, Axsome's shares have increased by 60.5%, significantly outperforming the industry average rise of 12.1% [2]

Financial Data and Key Metrics Changes - Total revenue for Q3 2025 reached $171 million, representing a 63% increase year over year [4][11] - Net product sales for Auvelity were $136.1 million, up 69% compared to the previous year [11] - Sunosi net product revenues were $32.8 million, reflecting a 35% increase year over year [11] - The net loss for the quarter was $47.2 million, or $0.94 per share, an improvement from a net loss of $64.6 million, or $1.34 per share, in the same period last year [13] Business Line Data and Key Metrics Changes - Auvelity showed strong prescription growth with approximately 209,000 prescriptions written, a 46% year-over-year increase [15] - Sunosi had approximately 53,000 prescriptions, representing a 12% year-over-year growth [18] - Sembravo generated $2.1 million in net sales during its first full quarter on the market [11] Market Data and Key Metrics Changes - Commercial coverage for Auvelity increased from 73% to 75%, bringing total coverage to 85% of all lives across channels [15] - Payer coverage for Sunosi remains at approximately 83% of lives covered across channels [18] - Sembravo's overall payer coverage was approximately 52% of all lives as of October 1st [17] Company Strategy and Development Direction - The company aims to broaden patient access and drive awareness with clinicians for its products [5] - Axsome is advancing a robust pipeline with late-stage programs targeting Alzheimer's disease agitation, narcolepsy, and ADHD [5][10] - The company plans to initiate a phase 2/3 trial for AXS-05 in smoking cessation and target NDA submission for AXS-12 for cataplexy in narcolepsy [7][8] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the continued growth potential of Axsome, highlighting strong performance across its commercial portfolio [19] - The company anticipates meaningful activity across its late-stage programs in the coming months [5] - Management noted that the fundamentals of the business have never been stronger, positioning Axsome for substantial near and long-term value [10] Other Important Information - The company ended Q3 2025 with $325.3 million in cash and cash equivalents, an increase from $315.4 million at the end of 2024 [14] - Gross-to-net discounts for Auvelity and Sunosi were in the high 40% range, expected to increase to the low 50% range in Q4 [12] Q&A Session Summary Question: Insights on Sembravo's launch and prescribing depth - Management noted early positive responses from healthcare providers and patients, with a targeted approach focusing on top headache centers [22][23] Question: Growth driver for Auvelity in primary care - Management emphasized the importance of primary care as a growth driver, supported by sales force expansion and direct-to-consumer campaigns [26][27] Question: Expectations for AXS-05 adoption in Alzheimer's agitation - Management is optimistic about AXS-05's impact, planning to cover various specialties and settings of care [31][32] Question: Sales force expansion and cash flow positivity - Management confirmed plans for sales force expansion if AXS-05 is approved, with costs already included in cash flow positivity guidance [35][76] Question: Impact of DTC campaign on Auvelity prescriptions - Management indicated that significant impacts from the DTC campaign may be observed in 8-12 weeks, with early positive trends noted [77] Question: Regulatory interactions for AXS-05 - Management stated that interactions are ordinary course and that they are prepared for standard review by the FDA [87]

Core Insights - Axsome Therapeutics focuses on developing treatments for brain disorders, with three drugs currently on the market and five in the pipeline, potentially addressing the needs of 150 million Americans suffering from such conditions [1][3][4] - The company reported a revenue of $495 million for the 12 months ending in June, marking a 70% increase from the previous year, although it remains unprofitable with a net loss of $247 million [3][4] - Axsome's market capitalization stands at $6.1 billion, and the company aims for peak sales of $16.5 billion from its current drug portfolio, contingent on successfully navigating FDA approvals for five new drugs by 2028 [4][13] Company Overview - Founded in 2012 by Herriot Tabuteau, Axsome Therapeutics was established with a unique approach to drug development, focusing on brain disorders and self-funding rather than relying on venture capital [1][2][5] - The company has evolved from humble beginnings in a small office to a significant player in the biotech sector, with a notable drug portfolio and innovative strategies for clinical trials [3][7] Financial Performance - Axsome's revenue growth of 70% year-over-year highlights its increasing market presence, although the company has yet to achieve profitability [3][4] - The stock price has increased by 35% over the past year, outperforming the Nasdaq Biotech Index, which only rose by 1% during the same period [12] Drug Development and Pipeline - The approval of Auvelity for major depressive disorder in August 2022 significantly boosted Axsome's market valuation, with shares rising 65% in a week [9] - Auvelity is projected to generate $500 million in sales this year and is expected to become a blockbuster drug, with potential annual revenues exceeding $1 billion [10][13] - Axsome is also working on a drug for Alzheimer's agitation, which could provide a safer alternative to current antipsychotic treatments, despite mixed results in Phase III trials [12][13] Strategic Acquisitions - In 2022, Axsome acquired Sunosi for $53 million, which treats excessive daytime sleepiness, and later sold its rights for $66 million, demonstrating effective financial management [11]

Core Insights - Axsome Therapeutics' lead drug, Auvelity, has shown strong sales performance since its approval for major depressive disorder, contributing significantly to the company's revenue [1] Sales Performance - Auvelity recorded sales of $215.9 million in the first half of 2025, marking an 82.3% increase year-over-year, driven by higher unit sales volume [2][9] - The company anticipates a compound annual growth rate (CAGR) of approximately 42.7% for Auvelity sales over the next three years [2] Product Development and Expansion - Auvelity is undergoing label expansion studies for other CNS disorders, including Alzheimer's disease agitation and smoking cessation, with an sNDA expected to be filed in Q3 2025 [3] - A pivotal phase II/III study for smoking cessation is planned to commence in Q4 2025 [3] - The approval of Auvelity for additional indications is expected to further enhance sales and growth prospects [4] Additional Products - Axsome's narcolepsy drug, Sunosi, has also contributed to revenue, with sales increasing by 25.6% year-over-year in H1 2025 [5][9] - The recent launch of Symbravo for migraine treatment, approved in January 2025, is expected to strengthen Axsome's market presence [5] Competitive Landscape - Axsome faces significant competition in the CNS disorder market, particularly from Acadia Pharmaceuticals' Nuplazid, which generated $328.2 million in sales, a 14% increase year-over-year [6][7] - Sunosi may encounter competition from Jazz Pharmaceuticals' sleep disorder drugs, while Symbravo will face established migraine treatments from Pfizer and AbbVie [8]

Group 1: Axsome Therapeutics - Axsome Therapeutics is a mid-cap biotech company with three products on the market: Auvelity, Symbravo, and Sunosi, driving strong revenue growth, with a 72% year-over-year increase to $150 million in Q2 [3][4] - The launch of Symbravo in June presents a significant growth opportunity, targeting a market of 39 million migraine patients in the U.S., where over 70% have inadequate responses to current treatments [4][5] - Auvelity shows promise in treating agitation associated with Alzheimer's disease, with a potential market of 7 million patients, and is on track to achieve blockbuster status [5][6] - The company is advancing its pipeline with AXS-12 for narcolepsy and other late-stage trials, positioning itself for continued revenue growth and market outperformance [6] Group 2: Exelixis - Exelixis specializes in oncology, known for its drug Cabometyx, which treats liver and kidney cancers and continues to drive revenue growth despite a reported 11% drop in total revenue to $568.3 million due to lower collaboration revenue [7][8] - Net product revenue for Exelixis increased by 19% year-over-year to $520 million, with Cabometyx expected to maintain strong sales through early 2030, fending off generic competition [8][9] - The company is focused on developing cancer therapies for high unmet needs, with its candidate zanzalintinib showing promise in metastatic colorectal cancer, which could address a significant treatment gap [9][10] - Exelixis has additional candidates in its pipeline, and strong clinical progress alongside Cabometyx's revenue growth is expected to yield strong returns through the end of the decade [10]

Group 1 - The event is the Fifth Annual TD Cowen Novel Mechanisms in Neuropsychiatry and Epilepsy Summit, featuring Axsome Therapeutics [1] - Axsome Therapeutics has made significant progress in both commercial and development aspects over the past year [2] - The company is expected to provide insights into future expectations for investors, particularly looking towards the end of 2025 and early 2026 [2] Group 2 - In Q2, Axsome Therapeutics reported net sales of $150 million, with Auvelity contributing $120 million and Sunosi $30 million [4] - The recent launch of SYMBRAVO generated approximately $400,000 in its first 2.5 weeks [4]