Executive Summary

Q2 2025 revenue was $390.7M and GAAP diluted EPS was $0.52; proprietary net sales grew 14% YoY to $307.2M, while manufacturing & royalty revenue declined as expected on INVEGA SUSTENNA® U.S. royalty expiration .
Results beat S&P Global consensus: revenue $390.7M vs $356.2M estimate*; GAAP EPS $0.52 vs $0.39 estimate*; EBITDA from continuing ops $101.6M vs $72.6M estimate*; strength was aided by ~$20M one-time gross-to-net tailwind (VIVITROL ~$9M; ARISTADA ~$11M) and broad demand .
2025 guidance reiterated (total revenues $1.34B–$1.43B; GAAP NI $175M–$205M; Adjusted EBITDA $310M–$340M; product net sales ranges unchanged), with management now anticipating finishing toward the high end on revenue and profitability .
Near-term stock catalysts: detailed Vibrance-1 (alixorexton) data at World Sleep in September and NT2 topline in the fall; management preparing to initiate global Phase 3 and highlighted strong cash ($1.05B) and no debt, providing optionality .

What Went Well and What Went Wrong

What Went Well
- Strong proprietary portfolio growth: VIVITROL $121.7M (+9% YoY), ARISTADA $101.3M (+18% YoY), LYBALVI $84.3M (+18% YoY) with LYBALVI TRx +22% YoY .
- Profitability and cash: GAAP net income $87.1M; EBITDA (cont. ops) $101.6M; cash and investments $1.05B; company reiterated 2025 guidance and indicated tracking toward the high end .
- Alixorexton Phase 2 NT1 success: significant, dose-dependent MWT improvements (p<0.0001 at all doses), robust improvements in fatigue and cognition PROs; management emphasized “no treatment-emergent safety signals” in ophthalmic exams and general tolerability .
What Went Wrong
- Mix headwind: manufacturing & royalty revenue down to $83.4M vs $129.9M in 2Q24 due to expiration of U.S. INVEGA SUSTENNA® royalty in Aug-2024, pressuring non-product revenue contributions .
- R&D spend stepped up on orexin programs ($77.4M vs $59.6M in 2Q24) with expectations to “step up slightly” in 2H25 as Phase 2 completes and Phase 3 prep begins, tempering near-term margin expansion .
- Cataplexy endpoint mixed: statistical significance achieved at 6mg dose only; management attributed variability to outliers and assay implementation, planning Phase 3 methodological refinements .

Financial Results

Metric	Q4 2024	Q1 2025	Q2 2025
Total Revenues ($M)	$430.0	$306.5	$390.7
Proprietary Net Sales ($M)	$307.7	$244.5	$307.2
Manufacturing & Royalty Revenues ($M)	$122.3	$62.0	$83.4
GAAP Net Income ($M)	$146.5	$22.5	$87.1
GAAP Diluted EPS ($)	$0.88 (cont. ops)	$0.13	$0.52
EBITDA – Continuing Ops ($M)	$170.0	$22.8	$101.6
Adjusted EBITDA ($M)	n/a	$45.6	$126.5

Segment/Product mix – quarterly comparison

Metric	Q2 2024	Q2 2025
Total Proprietary Net Sales ($M)	$269.3	$307.2
VIVITROL Net Sales ($M)	$111.9	$121.7
ARISTADA Net Sales ($M)	$86.0	$101.3
LYBALVI Net Sales ($M)	$71.4	$84.3
Manufacturing & Royalty Revenues ($M)	$129.9	$83.4

KPIs and balance sheet

KPI	Q1 2025	Q2 2025
Cash, Cash Equivalents & Investments ($M)	$916.2	$1,054.0
SG&A – Continuing Ops ($M)	$171.7	$170.8
R&D – Continuing Ops ($M)	$71.8	$77.4
Shares Outstanding – Diluted (k)	168,737	168,357

Estimate comparison (S&P Global consensus vs reported)

Metric	Consensus (Q2 2025)	Reported (Q2 2025)	Surprise
Revenue ($M)	$356.2*	$390.7	+$34.5M (beat)
GAAP EPS ($)	$0.39*	$0.52	+$0.13 (beat)
EBITDA – Continuing Ops ($M)	$72.6*	$101.6	+$29.0M (beat)

Values marked with * retrieved from S&P Global.

Drivers of the beat: ~~$20M gross-to-net favorability (Medicaid utilization adjustments) across VIVITROL (~~$9M) and ARISTADA (~$11M), plus broader demand across the portfolio; no inventory benefit in Q2 .

Guidance Changes

Metric	Period	Previous Guidance (Feb 12, 2025)	Current Guidance (Jul 29, 2025)	Change
Total Revenues	FY 2025	$1,340–$1,430M	$1,340–$1,430M	Maintained
VIVITROL Net Sales	FY 2025	$440–$460M	$440–$460M	Maintained
ARISTADA Net Sales	FY 2025	$335–$355M	$335–$355M	Maintained
LYBALVI Net Sales	FY 2025	$320–$340M	$320–$340M	Maintained
COGS	FY 2025	$185–$205M	$185–$205M	Maintained
R&D Expense	FY 2025	$305–$335M	$305–$335M	Maintained
SG&A Expense	FY 2025	$655–$685M	$655–$685M	Maintained
GAAP Net Income	FY 2025	$175–$205M	$175–$205M	Maintained
EBITDA	FY 2025	$215–$245M	$215–$245M	Maintained
Adjusted EBITDA	FY 2025	$310–$340M	$310–$340M	Maintained
Effective Tax Rate	FY 2025	~17%	~17%	Maintained

Management indicated performance tracking toward the high end of ranges for revenue and profitability for 2025 .

Earnings Call Themes & Trends

Topic	Q4 2024 (Q-2)	Q1 2025 (Q-1)	Q2 2025 (Current)	Trend
Proprietary product growth	Record proprietary product revenue and strong YoY growth across VIVITROL/ARISTADA/LYBALVI .	LYBALVI TRx +22% YoY; proprietary net sales $244.5M .	Proprietary net sales $307.2M (+14% YoY) ; Q3 guide for portfolio $280–$300M .	Positive demand; Q3 sequential step-down post gross-to-net tailwind.
Manufacturing & royalties	Noted mix includes INVEGA/TRINZA royalties; high in 2023 due to arbitration catch-up .	Lower M&R $62.0M .	M&R $83.4M; investor slides note SUSTENNA U.S. royalty expiration impacted results .	Structural headwind vs 2024.
Gross-to-net dynamics	Year-end GtN/Inventory favored Q4 product revenues .	No special tailwind disclosed.	One-time GtN tailwind ~$20M (VIVITROL ~$9M; ARISTADA ~$11M) .	Temporary benefit; normalizing in H2.
R&D/Orexin program	Preparing 2025 orexin readouts and advancement .	Vibrance-1 enrollment complete; NT2 mid-year enrollment completion expected .	Positive NT1 topline; planning Phase 3; NT2 topline in fall; IH mid-2026 .	Accelerating toward registrational program.
Safety (visual AEs)	n/a	n/a	Management emphasized normal ophthalmic exams; DSMB green lights; more data at World Sleep .	De-risking the class AE overhang.
Capital allocation	Ended 2024 debt-free; $825M cash; repurchased $200M shares in 2024 .	Cash $916.2M; debt-free .	Cash/investments $1.05B; $200M remaining buyback authorization .	Optionality intact.

Management Commentary

“Now, no debt and more than $1 billion of cash, we're in a strong financial position with significant optionality.” – CEO Richard Pops .
“These factors drove a one-time gross-to-net benefit of approximately $9 million for VIVITROL and approximately $11 million for ARISTADA.” – COO Blair Jackson .
“We remain well positioned to achieve our financial guidance for the full year… we now anticipate finishing the year towards the higher end… in terms of both revenue and profitability.” – COO Blair Jackson .
“Alixorexton normalized wakefulness and excessive daytime sleepiness… with a generally well tolerated profile… [and] robust… improvements on validated patient-reported measures [fatigue and cognition].” – CMO Craig Hopkinson .

Q&A Highlights

Visual AEs/class safety: No treatment-emergent ophthalmic safety signal; DSMB oversight; full safety database lock by mid-August; detailed safety at World Sleep .
Cataplexy endpoint: Stat. significance met at 6mg; pre-specified negative binomial model used; variability driven by outliers; Phase 3 to refine methodology; management confident cataplexy signal will support labeling .
Phase 3/regulatory: End-of-Phase 2 after NT2; plan likely one 3‑month NT1 and one similar NT2 registrational study; dosing range decisions pending NT2 analyses .
Dosing/PK: Confidence in tox profile at 8mg; exposure-response and safety modeling ongoing; no meaningful QD vs BID difference expected for cataplexy measure .
Near-term outlook: Q3 proprietary net sales guided to $280–$300M as GtN tailwind normalizes; no Q2 inventory benefit; demand-led growth across all three products .

Estimates Context

S&P Global consensus heading into Q2 2025: revenue $356.2M*, GAAP EPS $0.39*, EBITDA (cont. ops) $72.6M*. Reported results: revenue $390.7M, GAAP diluted EPS $0.52, EBITDA (cont. ops) $101.6M – all above consensus .
Implications: Street models likely need to reflect stronger proprietary net sales run-rate and the one-time GtN benefit; M&R headwinds and 2H R&D step-up temper longer-term margin trajectory .