Alkermes(US:ALKS)2023-02-16 16:46Financial Data and Key Metrics Changes - The company reported total revenues of $1.11 billion for 2022, a 24% year-over-year growth driven primarily by proprietary products [17] - GAAP net loss for the year was $158.3 million, compared to a loss of $48.2 million in the prior year, while non-GAAP net income was $57.9 million, down from $129.1 million in 2021 [18] - The company ended 2022 with approximately $740 million in cash and total investments, and a positive net cash position of approximately $447 million [26] Business Line Data and Key Metrics Changes - LYBALVI generated net sales of $96 million in its first full year, with fourth-quarter sales of $34.9 million, up 29% sequentially [8][20] - ARISTADA net sales for the fourth quarter were $79.2 million, reflecting a 7% year-over-year growth [13] - VIVITROL achieved net sales of $379.5 million for 2022, up 10% year-over-year, with fourth-quarter sales of $102 million [14][18] Market Data and Key Metrics Changes - Total prescriptions for LYBALVI in the fourth quarter were approximately 28,400, representing a 23% growth quarter-over-quarter [9] - The prescriber base for LYBALVI increased by approximately 27% since the end of Q3, with about 7,600 prescribers having written prescriptions [9] - The company expects LYBALVI net sales in 2023 to range from $180 million to $205 million, while VIVITROL is expected to generate $380 million to $410 million [12][29] Company Strategy and Development Direction - The company plans to focus on three key areas in 2023: expanding prescriber breadth, enhancing patient access, and building awareness through direct-to-consumer advertising [11][35] - The planned separation of the oncology business is expected to enhance the financial profile of the neuroscience business, allowing for a clearer investment thesis [17][47] - The company aims to achieve long-term profitability targets, increasing non-GAAP net income margin targets to 25% in 2024 and 30% in 2025 [32] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the ongoing launch of LYBALVI and its potential to drive significant revenue growth [36] - The company is optimistic about the orexin 2 receptor agonist program, with initial studies showing promising safety and tolerability profiles [38] - The separation of the oncology business is anticipated to unlock value and position both segments for growth [47] Other Important Information - The company recorded manufacturing and royalty revenues of $332 million for the year, down from $541.8 million in the prior year, primarily due to a decrease in royalties from long-acting INVEGA products [21][23] - Total operating expenses for 2022 were $1.25 billion, with R&D expenses reflecting focused investments in clinical programs [24][25] Q&A Session Summary Question: Can you discuss the balance between SG&A and R&D spend on the neuropsych business? - Management indicated that long-term margin targets depend on revenue growth and that investments in LYBALVI will continue to maximize opportunities [51] Question: On your long-term guide, how do you see LYBALVI's expectations evolving? - Management did not provide specific long-term expectations but emphasized that growth from proprietary products will drive profitability [55] Question: Can you clarify the dynamics of LYBALVI prescriptions? - Management noted that the growth in prescriptions is primarily driven by new prescribers, with a stable depth of prescribing [58] Question: What are the expectations for the orexin program's clinical trials? - Management confirmed that the current data is from single-ascending dose cohorts, with multiple ascending dose studies expected to start soon [61] Question: How will the oncology spin impact profitability targets? - The oncology spin is expected to reduce R&D costs significantly, aiding in achieving revised profitability targets [72]