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Axsome Therapeutics, Inc. (AXSM)·Q3 2024 Earnings Summary

Executive Summary

  • Q3 2024 net product revenue reached $104.8M (+81% y/y; +20% q/q), driven by Auvelity strength and steady Sunosi growth; operating loss was $62.6M and GAAP EPS was $(1.34), with $40.9M in non-cash charges including a $16.4M contingent consideration fair value adjustment .
  • Auvelity delivered $80.4M (+113% y/y; +24% q/q) on 144k prescriptions (+17% q/q) and expanding commercial coverage to ~63% and total coverage to ~78%; Sunosi revenue was $24.4M (+21% y/y; +10% q/q) on ~47k prescriptions (+5% q/q) with ~83% total coverage .
  • Guidance catalysts tightened: AXS-07 NDA accepted with Jan 31, 2025 PDUFA; AXS-14 NDA submission anticipated in November; AXS-05 AD agitation pivotal readouts (ADVANCE‑2 and ACCORD‑2) guided for Q4; FOCUS (ADHD) and PARADIGM (MDD) Phase 3 solriamfetol timelines refined to 1Q 2025 .
  • Wall Street consensus from S&P Global was unavailable at the time of this recap due to access limits; estimates comparison could not be validated. Note: consensus unavailable.

What Went Well and What Went Wrong

What Went Well

  • Auvelity momentum: net sales $80.4M (+113% y/y; +24% q/q) with ~144k prescriptions (+17% q/q) and ~63% commercial coverage; “a second expansion of the Auvelity sales force” to ~300 reps slated for 1Q 2025 . Quote: “In response to continued strong demand growth, a second expansion of the Auvelity sales force is planned for the first quarter of 2025.” — CEO Herriot Tabuteau .
  • Sunosi resilience: $24.4M (+21% y/y; +10% q/q), ~47k prescriptions (+5% q/q), ~83% total coverage, with ex‑U.S. royalty contribution and litigation dismissal with Sandoz removing a near-term generic overhang .
  • Pipeline visibility: AXS‑07 PDUFA date fixed (Jan 31, 2025) and commercial preparations underway; simultaneous ADVANCE‑2 and ACCORD‑2 AD agitation toplines on track in Q4; AXS‑14 NDA submission anticipated in November . Quote: “Launch preparations are underway to ensure timely commercialization, if approved.” — CEO Herriot Tabuteau .

What Went Wrong

  • Continued GAAP losses: net loss $(64.6)M (EPS $(1.34)) vs $(62.2)M in 3Q23, reflecting higher R&D ($45.4M) and SG&A ($95.6M) from pipeline and commercialization; non‑cash charges totaled $40.9M including $16.4M contingent consideration fair value adjustment .
  • Expense trajectory: management guided to “slight increase” in R&D and SG&A in Q4 (PDUFA prep and migraine launch readiness), suggesting near-term operating leverage still deferred .
  • Solriamfetol timelines: FOCUS (ADHD) enrollment completion now December with topline in 1Q 2025 (vs 2H 2024 prior), and PARADIGM (MDD) also guided to 1Q 2025, modestly pushing out catalysts .

Financial Results

MetricQ1 2024Q2 2024Q3 2024
Total Revenues ($USD Millions)$75.0 $87.2 $104.8
Net Loss ($USD Millions)$(68.4) $(79.3) $(64.6)
Diluted EPS ($USD)$(1.40) $(1.67) $(1.34)
Cost of Revenue ($USD Millions)$6.3 $8.1 $8.4
R&D Expense ($USD Millions)$36.8 $49.9 $45.4
SG&A Expense ($USD Millions)$99.0 $103.6 $95.6
Loss from Operations ($USD Millions)$(?) — not disclosed in Q1 table$(78.0) $(62.6)

Segment breakdown (net product revenues):

SegmentQ1 2024Q2 2024Q3 2024
Auvelity Net Product Sales ($USD Millions)$53.4 $65.0 $80.4
Sunosi Net Product Revenue ($USD Millions)$21.6 $22.1 $24.4

Key KPIs:

KPIQ1 2024Q2 2024Q3 2024
Auvelity Prescriptions~95,000 ~123,000 ~144,000
Sunosi Prescriptions (U.S.)~41,000 ~45,000 ~47,000
Auvelity Coverage – Commercial~48% (pre-Aug 1) 60% (as of Aug 1) ~63%
Auvelity Coverage – Total~70% ~76% ~78%
Sunosi Coverage – Total~83% ~83% ~83%
Gross-to-Net Discount (Auvelity)Low–mid 50s (seasonal) Low–mid 50s ~50% in Q3
Gross-to-Net Discount (Sunosi)Mid‑50s Low–mid 50s Low 50s

Balance sheet snapshot (quarter-end):

  • Cash & equivalents: $331.4M (Q1) ; $315.7M (Q2) ; $327.3M (Q3) .
  • Shares outstanding: 47,801,578 (Q2) ; 48,436,108 (Q3) .

Guidance Changes

MetricPeriodPrevious GuidanceCurrent GuidanceChange
Cash runwayOngoing“Sufficient to fund anticipated operations into cash flow positivity” “Sufficient to fund anticipated operations into cash flow positivity” Maintained
R&D expense trajectoryQ4 2024Not specifiedSlight increase in Q4 (AXS‑14 PDUFA prep) New/raised
SG&A expense trajectoryQ4 2024Not specifiedPotential slight increase (migraine launch prep) New/raised
Auvelity sales force1Q 2025Expansion earlier in 2024 completed Second expansion to ~300 reps planned 1Q 2025 Raised
AXS‑07 (migraine)RegulatoryNDA resubmitted; Class 2 review expected NDA accepted; PDUFA Jan 31, 2025; EMERGE topline 4Q 2024 Clarified timeline
AXS‑14 (fibromyalgia)RegulatoryNDA submission expected 3Q 2024 NDA submission anticipated November 2024 Deferred modestly
Solriamfetol FOCUS (ADHD)ClinicalTopline 2H 2024 Enrollment complete Dec; topline 1Q 2025 Deferred
Solriamfetol PARADIGM (MDD)ClinicalTopline 2025 Topline 1Q 2025 Tightened to 1Q

Earnings Call Themes & Trends

TopicPrevious Mentions (Q1 & Q2 2024)Current Period (Q3 2024)Trend
Auvelity demand & accessQ1: ~95k Rx; ~70% total coverage; GPO contracting; sales force expansion impact; GTN low–mid 50s . Q2: ~123k Rx; commercial coverage +22M lives to 60%; total to ~76% .~144k Rx; commercial ~63%; total ~78%; second sales force expansion planned; primary care fastest-growing segment .Strengthening; expanding reach/frequency; access improving
Sunosi performanceQ1: ~41k Rx; 83% coverage; seasonality headwind . Q2: ~45k Rx; strong new patient starts; 83% total coverage .~47k Rx; ~83% total coverage; ex‑U.S. royalties rising; Sandoz litigation dismissed .Steady growth; legal overhang reduced
AXS‑07 (migraine)NDA resubmission; EMERGE topline 2H 2024; launch strategy under development .NDA accepted; Jan 31, 2025 PDUFA; EMERGE topline Q4; targeted differentiated launch; pricing/market access in focus .Regulatory clarity; launch prep escalates
AXS‑05 (AD agitation)ADVANCE‑2 & ACCORD‑2 on track for 2H 2024; robust filing package strategy .Simultaneous toplines in Q4; similar designs to prior positives; potential NDA filing 6–9 months post-readouts .High-impact Q4 catalysts near
AXS‑12 (narcolepsy)SYMPHONY positive; ENCORE OLE as registration support .ENCORE topline Q4; NDA path outlined (not contingent on ENCORE efficacy) .Filing groundwork progressing
Solriamfetol expansionFOCUS 2H 2024; PARADIGM/ENGAGE 2025; SUSTAIN 2026 .FOCUS & PARADIGM shifted to 1Q 2025; ongoing BED (2025) and SWD (2026) .Timelines refined (slight delay)
Cost disciplineQ1/Q2: OpEx elevated; inventory steady; GTN seasonal .Q4 R&D/SG&A slight increase; principle-efficient capital allocation reiterated .Near-term OpEx uptick; disciplined framing

Management Commentary

  • “The third quarter was another strong quarter… quarterly product revenue in excess of $100 million for the first time… translates to an annual revenue run rate of approximately $420 million” — CEO Herriot Tabuteau .
  • “Gross to net was approximately 50% for Auvelity and in the low 50s for Sunosi.” — CFO Nick Pizzie .
  • “Primary care clinicians were the fastest-growing segment… rapidity of response is a very compelling attribute.” — CCO Ari Maizel .
  • “We believe that our current cash balance is sufficient to fund anticipated operations into cash flow positivity.” — CFO Nick Pizzie .

Q&A Highlights

  • Auvelity sales force expansion: ramp expected to build over the year, mirroring prior expansion; completion targeted for 1Q 2025 . Clarification that expansion is driven by MDD opportunity, with potential future ADA launch synergies .
  • AD agitation filing strategy: ADVANCE‑2 and ACCORD‑2 readouts in Q4; filing could proceed with positive outcome from one or both (adding to two completed positive trials); NDA prep typically 6–9 months post-study completion .
  • Cost outlook: slight increase in Q4 R&D (AXS‑14 submission) and SG&A (AXS‑07 launch prep); capital efficiency emphasized .
  • Market access: coverage expansion pulling through; Auvelity commercial coverage now ~63% and total ~78%; ongoing negotiations to evolve access criteria to first/second‑line .
  • AXS‑07 launch approach: targeted, differentiated; pricing and payer landscape under evaluation given crowded oral CGRP/triptan space .

Estimates Context

  • S&P Global Wall Street consensus estimates for revenue and EPS were unavailable due to access limits at the time of this report; therefore, beats/misses versus consensus could not be assessed. Note explicitly that consensus was unavailable.

Key Takeaways for Investors

  • Commercial trajectory remains strong: Auvelity’s sequential growth (+24% q/q) and expanding coverage underpin continued TRx momentum into 2025; watch primary care penetration and second sales force expansion completion in 1Q 2025 as growth accelerants .
  • Near-term binary catalysts: Q4 simultaneous toplines for AXS‑05 (ADVANCE‑2 and ACCORD‑2) could unlock ADA filing and reshape the Alzheimer’s agitation landscape; monitor filing timing and branding strategy (Auvelity vs. new brand) .
  • AXS‑07 regulatory clarity: PDUFA Jan 31, 2025 with EMERGE data in Q4 to inform positioning in CGRP‑non‑responders; prepare for targeted launch and payer negotiations; SG&A will rise modestly in Q4/Q1 for launch readiness .
  • Expense profile: R&D/SG&A increases in Q4 signal investment phase; contingent consideration valuation swings (non‑cash) can create EPS volatility; focus on operating loss path as pipeline transitions to commercialization .
  • Sunosi steady-state: continued Rx growth, durable coverage (~83%), and ex‑U.S. royalties; litigation dismissal reduces risk; incremental tailwinds from broader clinical development (MDD/ADHD/BED/SWD) over 2025–2026 .
  • Cash runway: $327.3M cash and management reiteration of runway to cash flow positivity supports execution on multiple launches without near-term financing, subject to operating plan .
  • Trading lens: Q4 is catalyst-heavy (AD agitation, AXS‑07 EMERGE, AXS‑12 ENCORE); position sizing should account for multi‑asset readout clustering that can drive volatility and re‑rating across CNS franchises .

Additional Primary Sources and Q3 Context

  • 8‑K furnishing Q3 press release and corporate presentation (financials, KPIs, milestones) .
  • Q3 earnings press release (full financials and pipeline update) .
  • Other Q3 press items: NDA resubmission acceptance for AXS‑07 (Sept 4) ; conference data presentations in October/November (Psych/NEI) supporting Auvelity’s safety/tolerability .