Intra-Cellular Therapies - Q4 2022

Transcript

Speaker 0

You for standing by, and welcome to the IntraCellar Therapeutics 4th Quarter 2022 Earnings Conference Call. At this time, all participants are in a listen only mode. After the speakers' presentation, there will be a question and answer session. As a reminder, today's program is being recorded. And now I'd like to introduce your host for today's program, Doctor.

Juan Sanchez, Vice President, Corporate Communications and Investor Relations, please go ahead.

Speaker 1

Good morning, and thank you all for joining us on our Q4 and full year 2022 earnings call. Joining me on the call today are Doctor. Cheryl Meade, Chairman and Chief Executive Officer Mark Newman, Chief Commercial Officer Doctor. Suresh Thogan, Chief Medical Officer and Larry Heinlein, Chief Financial Officer. As a reminder, during today's call, We will be making certain forward looking statements.

These forward looking statements are based on current information, assumptions and expectations. Those are subject to change and involve a number of risks and uncertainties that might cause actual results to differ materially from those contained in the forward looking statements. These and other risks are described in our periodic filings made with the Securities and Exchange Commission, including our quarterly and annual reports. You are cautioned not to place undue reliance on these forward looking statements and the company disclaims any obligations to update such payments. Sharon?

Speaker 2

Thanks, Juan. Good morning, everyone, and welcome to today's call. We are excited to share with you our results for the Q4 and the full year 2022. I'm pleased to report that we achieved strong sales growth of CAPLYTA and we continue to advance our promising pipeline. 2022 was an exceptional year for the growth of Keplita as we successfully launched our new indication for bipolar depression.

Keplitis prescriptions tripled in 2022 compared to 2021. We have received very positive feedback from physicians and patients on Cephalitis efficacy, tolerability and ease of use. We believe Cephalitis is having a positive impact On patient slides. For 2022, our total revenues were $250,300,000 Teplita net sales were $249,100,000 versus $83,800,000 in 2021, representing a 205% increase. Keplita's net sales for the Q4 2022 Were $87,400,000 representing a year over year increase of 2 43%.

Demand for CAPLYTA has been consistently strong and we are confident of continued growth for CAPLYTA. With this in mind, we are pleased to provide revenue guidance for the first time. In 2023, We expect capitalized net sales to be between $430,000,000 $455,000,000 In 2023, we continue to invest in our near term and future growth. In the near term, our commercial team is focused on maximizing the significant potential for CAPLYTA in our current indications Our future growth will be driven by the continued success of CAPLYTA as well as the execution of our clinical programs. Let me elaborate further on our clinical programs.

We are excited about the potential for label expansion of CAPLYTA in major depressive disorders and other mood disorders, ITI-twelve eighty four, Our PD-one inhibitors, ITI-three thirty three and our long acting injectable program for lumateperone. Beginning with major depressive disorder, which affects about 21,000,000 Americans who experience at least 1 major depressive Our global pivotal program evaluating lumateperone as adjunctive treatment for major depressive disorder In patients who partially respond to antidepressants is ongoing. Patient enrollment continues in studies 501 and 502, 2 global 6 week randomized double blind placebo controlled Phase 3 trials to assess efficacy and safety. We expect to file a supplemental new drug application with the FDA for the approval of Lumateperone as an adjunctive therapy to antidepressants for the treatment of MDD in 2024. Additionally, we are pleased to announce today we are initiating a 3rd global Phase 3 adjunctive MDD study, Study 505.

This study is similarly designed to our ongoing And we plan to begin patient enrollment shortly. This approach is consistent with the way we conducted programs for our previous indications And is common strategy in the development of mood disorder programs. Let's now move on to our mixed features program. Study 403 is our global clinical trial evaluating Lumateperone 42 milligrams in patients with MDD and patients with bipolar depression This patient population has more severe symptoms, more comorbidities and a higher risk of suicide attempts and patients without mixed features. This results in higher healthcare utilization and associated costs.

We anticipate announcing top line results later this quarter. Now let's talk about ITI-twelve eighty four. This year, we are advancing 1284 programs into Phase 2 clinical development In multiple highly prevalent conditions with unmet needs, including agitation in Alzheimer's disease, psychosis in Alzheimer's disease and generalized anxiety disorder or GAD. Alzheimer's disease affects 6,500,000 Americans over age 65 and will increase further with the aging population. Education is experienced by greater than 50% of Alzheimer's patients And psychosis occurs in 30% to 50% of patients.

These symptoms are difficult to treat and there is an urgent need for medicines to treat these symptoms. Our other Phase 2 program for ITI-twelve eighty four is in GAD. GAD affects approximately 7,000,000 adults in the U. S. Each year with 3 quarters of these patients experiencing Moderate or severe functional impairment.

Half of patients do not respond to initial therapy. We look forward to updating you on the progress of these studies. We continue to advance the development of our Lumateperone long Injectable program. In 2022, we completed a Phase 1 study with our initial formulation. We plan to initiate Phase 1 studies Several LAI formulations in 2023.

The goal of this program is the development of LAI formulations that are effective, Safe and well tolerated with treatment durations of 1 month and longer. Moving to our PDE1 inhibitor program. PDE1 is an enzyme highly expressed in certain brain regions, certain cancer cells and immune cells, including macrophages and microglia. In disease states, PDE1 becomes highly active and uncontrolled, preventing a cell's ability To respond appropriately to its environment. Inhibition of this enzyme in a pathological state restores normal function.

For example, in Parkinson's disease, dopamine pathways are affected and PDE1 inhibitors As immunomodulators in neurodegenerative diseases and cancer, where important pathways are compromised in immune cells. We are evaluating our PDE-one inhibitor, lenrifepoten, in a Phase 2 study for the treatment of motor symptoms and cognitive impairment We expect to begin enrollment later this month. Parkinson's is the 2nd most common For our newest PE-one inhibitor, ITI-ten twenty, We recently received a you may proceed letter from the FDA and now have an active IND to evaluate this compound As a novel cancer immunotherapy, we plan to start a Phase 1 study in healthy volunteers In the first half of twenty twenty three. Finally, IGI-three thirty three has the potential to treat opioid use disorder as well as pain and mood disorders. Opioid use disorder continues to be at epidemic levels.

The number of opioid involved overdose deaths In the U. S. Continues to increase with more than 80,000 deaths reported in 2021, up from 21,000 in 2010. We have completed a Phase 1 single ascending dose study and recently started a multiple ascending dose study. We also have an ongoing neuroimaging study looking at receptor occupancy.

We are excited about the potential for our development programs as they have the potential to serve patients who currently suffer from serious disorders Our company is in a strong financial position, ending the year with $593,700,000 in cash, We're very proud of our performance across the company and look forward to continued growth and sharing our progress with you. I'll now turn the call over to Mark to further discuss

Speaker 3

Thanks, Sharon, and good morning, everyone. As Sharon noted, 2022 was an exceptionally strong year for Capylita as we successfully launched our new bipolar depression indication. Since launch, total prescriptions have tripled and new patient starts are now at levels 5 times higher than before the bipolar depression label expansion. For the full year 2022, Keplita total and new prescriptions increased 193% 2 20 percent respectively over the prior year. This growth is being driven by a compelling product profile, broad market access And strong commercial execution by our experienced sales and marketing team.

CAPLYTA has been well received in the marketplace and we are gratified by the overwhelmingly positive feedback from both prescribers and patients regarding their experience with the product. We continue to see strong underlying demand and prescriber adoption for CAPLYTA as we consistently increase both the breadth and the depth of our prescriber base, adding significant numbers of unique new prescribers and expanding the average number of prescriptions per prescriber. We delivered another great quarter for CAPLYTA. CAPLYTA prescriptions again significantly outperformed the antipsychotic Total CAPLYTA prescriptions grew 21% sequentially versus Q3, while the overall antipsychotic market was essentially We have carried this positive momentum into 2023 and the strength of our commercial fundamentals and metrics subscriber and consumer promotional activities for 2023 to ensure a continuation of the robust growth we have experienced 1st, commensurate with the strong demand and positive reception of CAPLYTA to date, We have increased our commercial footprint and recently added 50 highly experienced neuroscience sales representatives to our team. This larger team allows us to connect more frequently with prescribers and continue to expand our reach, iteration of our LED in the Light direct to consumer campaign and are implementing broad national advertising through television, Digital and social media platforms to continue to raise awareness about the unmet need in bipolar 1 and bipolar 2 depression and educate potential patients about the benefits of CAPLYTA.

All of these efforts Are supported by strong market access coverage across all three payer channels. CapElita has maintained broad coverage in the Medicare Part D and Medicaid channels with more than 98% of lives covered. We have further expanded coverage In the commercial channel, which is the primary payer for patients living with bipolar disorder. We expect to achieve Commercial coverage for approximately 90% of lives by the end of this quarter. While we are very pleased with the uptake of Caplight at this stage of the launch, We have a strong belief that there remains plenty of room to grow and we are investing behind the brand accordingly.

The bipolar depression market is large and has a significant remaining unmet need. Our current label, which includes the use of CAPLYTA as Both monotherapy and as a jump of treatment in bipolar 1 and bipolar 2 depression allows us to address large patient populations with Tens of thousands of prescribers. As prescribers continue to acquire positive experience with CAPLYTA, The depth and breadth of utilization increases. This dynamic is building sustained demand for our medicine. This is in line with historical precedents for antipsychotics approved for mood disorders, where branded antipsychotics have long growth trajectory and generate positive volume growth for years.

We expect the same dynamic for Capalina. In summary, 2022 was a tremendous year and we look forward to another successful year in 2023. Our team has been executing extremely well and we are building on our growth momentum. I'm confident that we will continue to grow robustly in the coming year as we remain laser focused on executing our commercial plan. We're excited to continue improving the lives Now I'll hand the call over to Larry to detail our financial performance.

Larry?

Speaker 4

Thank you, Mark. I will provide highlights of our financial results for the 4th quarter and year ending December 31, 2022 and our outlook for 2023. Starting with our 4th quarter results, Net product sales of Kapolei to were $87,400,000 compared to $25,500,000 for the same period in 2021, representing a year over year increase of 2 43% and a 22% increase over the Q3 of 2022. Our gross to net percentage remained in the low 30s in the 4th quarter consistent with our guidance. Inventory levels in the trade measured by days on hand of capitalita at the wholesale level remained consistent throughout the quarter.

For the full year 2022, total revenues were $250,300,000 compared to $83,800,000 in 2021. Net product sales of Capoeira were $249,100,000 for the full year 2022 compared to $81,700,000 for 2021, representing an increase of 205%. Selling, general and administrative, SG and A expenses were $94,600,000 for the Q4 of 2020 2, compared to $79,700,000 for the same period in 2021. For the full year, SG and A expenses were $358,800,000 compared to $272,600,000 in 2021. Research and development R and D expenses for the Q4 of 2022 were $33,900,000 compared to 29 $500,000 for the Q4 of 2021.

R and D expenses for the full year 2022 were $134,700,000 compared to $88,800,000 in 2021. Cash, cash equivalents and investment securities totaled $593,700,000 at December 31, 2022 compared to $412,300,000 at December 31, 2021. Turning to our outlook for 2023, as Sharon mentioned, we expect capitalita net sales to be between $430,000,000 $455,000,000 reflecting continued strong growth. This sales guidance takes into account our expectation that capitalized gross to net percentage We'll increase to the mid-30s in 2023. For 2023, we estimate SG and A expenses to range between 420 $450,000,000 which includes approximately $29,000,000 of non cash share based compensation expense.

This reflects our commitment to support capitalized commercialization through investments in our sales organization and marketing activities. For 2023, we estimate R and D expenses to range between $195,000,000 $220,000,000 which includes approximately $17,000,000 of non cash share based compensation expense. Our R and D guidance reflects investments to support our robust pipeline, including multiple studies in our lumateperone clinical programs and our 3 other developmental platforms. In 2023, We anticipate that a substantial portion of our total R and D expenditures will be related to our lumateperone development programs. This concludes our prepared remarks.

Operator, please open the line for questions.

Speaker 0

We ask that you please limit yourself to 1 question each. You may get back in the queue as time allows. One moment for our first question. And our first question comes from the line of Andrew Stice from Jefferies. Your question please.

Speaker 5

Thanks. Good morning and big congratulations on The great quarter and a great guidance. So I'll kick things off and ask about the guidance overall for 2023. Team, what drove Your decision to guide on revenue? And secondly, is your revenue guidance provided in such a way that we can expect Potentially beaten raises throughout the year.

So just trying to gauge whether you're giving a more conservative, more accurate or more aggressive type of guidance here. Thank you.

Speaker 2

Thanks, Andrew, and thanks for the kind words. This is Sharon, and I'll start and then I'll turn it over to Mark. Obviously, we're giving guidance now because we're confident in our trajectory and what we've seen with our very strong launch for So that's the overall statement. And then rather than stealing Mark's Thunder, why don't I ask Mark to comment further and then maybe I'll come back if there's anything else to add.

Speaker 3

Yes, sure. Sharon, and thanks for your question, Andrew. Yes, to pick up where Sharon left off, what we've been seeing with CAPLYTA is we've We've been consistently increasing both the breadth and the depth of CAPLYTA prescribing month over month. And to provide a little context around that, to date, there have been over 22,000 unique prescribers And we're adding over 1200 new first time prescribers every month. And in addition to that, the depth of their prescribing is increasing as well.

So we're also expanding the average number of prescriptions per prescriber. And while we're really pleased with this update to date and it supports the trajectory that you've seen throughout the course of the year, We strongly believe that there's still plenty of room to grow for a lot of the reasons that we talked about in our prepared remarks. These are large patient population. We have a large prescriber base with tens of thousands of prescribers and a significant remaining unmet need. And so We've taken some steps in 2023 that I detailed in the prepared remarks to invest behind the brand to really fuel this growth further.

And I'd say that we just we have a strong belief and a high degree of confidence that we'll continue to experience this robust growth this year.

Speaker 0

Thank you. One moment for our next question. And our next question comes from the line of Brian Abrahams from RBC. Your question please.

Speaker 6

Hey, good morning. Thanks for taking my question and my congrats as well on all the progress. Maybe another question with regards to your capital guidance.

Speaker 3

Can Can you

Speaker 2

talk a

Speaker 7

little bit more about maybe some

Speaker 6

of the puts and takes within the guidance and the different ends of the ranges? You mentioned Gross to net expectations, but also wondering, I guess, what the guidance contemplates with regards to additional demand growth, any Changes in the overall dynamics with additional generic entrants and just I guess curious the scenarios that would steer you that would I guess Steer towards the low end versus the high end of the range. Thanks.

Speaker 2

Mark, do you want to take that?

Speaker 3

Yes. I think, Brian, it's simply looking at the trends that we've had to date with the bipolar launch And an expectation that those trends will continue throughout 2023, we've said before and we continue to believe That the generic entries of lorazodone from Latuda should not have a significant impact on CAPLYTA. Historically, in this category, when products go generic, the remaining branded products are not significantly impacted. So for example, when Abilify and Seroquel went generic, the growth of Bralar and Latuda Was not impacted and they continued their growth trajectory. So we anticipate a similar dynamic With lorazodone going generic, and then I think just the belief with the increased investment in our sales force, The continued investment in DTC and across our marketing mix that we feel that the trend should continue throughout 2023 and build especially towards the latter part of the year.

Speaker 6

Got it. And in terms of just the variance?

Speaker 3

Yes, I think it's just we don't expect a great deal We expect the trend to continue. And I think, specifically with the incremental investments that we're making In the sales force as those and we just recently added them, so they literally are just out in the field this month. As they get more and more comfortable in their territories, that will accelerate the growth. Our DTC throughout the year Should continue to raise awareness among patients, educate them on the benefits of Cap Lida, and we'll see that continue to go, as well as in the market access space. We've Always had good broad access, particularly in Medicare and Medicaid with over 98%.

With commercial, We've been at 85% through the balance of last year and more recently now Have increased that to 90%, which we expect to be implemented by the end of the month. So I think all of those things should drive real robust growth throughout the year.

Speaker 2

And I would just like to remind you, this isn't a variance. It's just Telling you that we expect the momentum to build over the course of the year with Growing revenue as we go from quarter to quarter. Obviously, Q1 has some 1st quarter seasonal dynamics built in and then less so in the second quarter and then Building further into the Q3 and Q4.

Speaker 0

Thank you. One moment for our next question. And our next question comes from the line of Jessica Fye from JPMorgan Chase. Your question please.

Speaker 8

Hey, guys. This is Na san on for Jessica. Congratulations on the fantastic guide. Could you provide Your latest expectations on when we can hear the top line results from the adjunctive MDD trials. And Can you talk about give us a little bit color on the reasoning for starting another adjunctive trial this year?

Thank you.

Speaker 2

Yes, sure. This is Sharon, and I'll start and then I'll ask Suresh if he wants to add. We've guided you To a filing of an sNDA in 2024 for Our adjunctive MDD and that's based on studies 501, 502 and 503. We have said that I think with your other question just repeat your other question for me, please. Operator, is anybody there?

Speaker 9

You may proceed.

Speaker 3

She may have disconnected, Sharon.

Speaker 2

Oh, she got disconnected? Okay. Well, I think her question was Why are we does

Speaker 10

anybody want

Speaker 2

to paraphrase it or should we just go on to the next question and then I'll come we'll come back to it as hopefully she reengages.

Speaker 0

Certainly one moment for our next question. Our next question comes from the line of Omar Raffat from Evercore ISI. Your question please.

Speaker 11

Hi, guys. This is Mikey Furey in for Umer. Thanks so much for taking our questions and congrats on the quarter in progress. Just 2 for me, one clinical and one commercial. The clinical one regarding your mixed features trial.

I know top line results are due sometime this quarter, but at a recent broker conference, you Mentioned that the placebo group in mixed patients may be very different from what we've seen in Depression patients, so how

Speaker 3

do we think about that?

Speaker 11

Is our depressed patients and for patients who are being treated as adjunctive depressed patients, Since they're already experiencing a partial response, could we expect a greater placebo response in these patients? Just any thoughts on how to frame that? And The commercial questions regarding your guidance, it seems pretty conservative. At the high point of your guidance that assumes roughly around 80 New prescriptions adds added every week on average, which seems pretty doable. I think since the beginning of the year, there's been around An average of 200 prescriptions added weekly.

Just any thoughts along those lines? Thanks.

Speaker 2

So let's start with the Commercial question and I'll ask Mark, do you want to take that and then We'll go to Suresh or I'll take the one of us will take the clinical question.

Speaker 3

Yes. Mike, I don't know that I have much more to add other than what we've said that we have a high degree of confidence in the continued growth of Capilita and we set the range at what we thought was the appropriate range, given the growth that We've been seeing so overall, I would just say we're we have a high degree of confidence that we've got the range right.

Speaker 2

Okay. And also on the Clinical question on placebo. I think all studies have placebo effects. I'm really not certain there would be any more or less Cheer than any other study, but I'll ask Suresh if he wants to comment any further.

Speaker 9

Yes. Good morning. These are different populations. One is the mixed feature study is the monotherapy study And the adjunctive treatment study is adjunctive to other antidepressants. And That is patients who have already partially responded to the 100%.

These are 2 different populations and There are several differences within the populations. Also that each individual study has its comes with its own Set up issues that is the patients, what kind of patients, severity they are coming from, what concomitant medications they have been on. All these play a role in determining how the study reads out. So you cannot make comparisons between one study to another, especially when they are not Similar designs when there are 2 different populations. And that's the reason why we had to look those in 2 different sets of individual studies.

Speaker 1

Got it. Thank you.

Speaker 0

Thank you. One moment for our next question. And our next question comes from the line of Marc Goodman from SVB Leerink. Your question please.

Speaker 3

Yes, good morning. Can you give us a little more color on these Phase 2 programs for 1284, AD agitation, AD psychosis? How are these patients Different and what endpoints you're looking at that will be different here, and the anxiety one. And then just Larry, just quickly, the Sales reps that were added, the 50 reps, are they getting added in 23 or any of them added in the 4th quarter? Thanks.

Speaker 2

Resh, do you want to take the definition of agitation versus psychosis?

Speaker 9

Yes. So for the 1284 ODT, we are I'm progressing with studies in 3 different indications. 1, the first one is agitation in Alzheimer's disease. This is purely looking at patients who have agitation. It's common for Alzheimer's patients to have behavioral symptoms, Both agitation and psychosis, but they are different indications and they have different endpoints.

So the first study we would be looking at is the agitation part of the study. And regarding the details of the endpoints And the study designs as we come closer to starting the trial, we will let you know. In terms of the next indication that is Talking about psychosis in Alzheimer's disease, that endpoints also are different from Basically looking at psychotic symptoms within the Alzheimer's patients who have Alzheimer's disease and that study also is going to start this year. And the GAD, it's a generalized anxiety disorder. And there has been, as We have indicated in our call that there is a lot of treatment failures and patients only respond partially to some of the drugs And there is still an unmet need in this population and adding this drug to those populations will help With treating the anxiety symptoms and there is a big unmet need and the details of all of individual designs of these studies will be

Speaker 1

Thank you.

Speaker 0

One moment for our next

Speaker 4

question for Mark.

Speaker 3

Yes. Mark, I can The sales representative, timing question, all of the representatives were brought on in 2023. So they had start dates In a couple of ways in the latter part of January and pretty much for the month of February have been onboarded and getting trained up. And only recently in the last week or 2, have they been out in the field selling. So that's the timing.

Speaker 0

Thank you. One moment for our next question. Our next question comes from the line Amy Fadia from Needham. Your question please.

Speaker 12

Hi, good morning. Thanks for taking the question. Can you Share with us the rationale for initiating a 3rd adjunctive MDD study and why prior to the readout of the ones that are ongoing. And then just with regards to the mixed seizure study that's going to readout So, help us understand sort of what you think that you need to be able to demonstrate To move ahead and seek sort of registration on seek approval in that indication, You've indicated in the past that data will drive further discussions with the FDA. What I'm trying to understand, It seems that maybe at least since Radon, they had run a study, but then they did not end up getting approval.

It appeared to us that the bar was probably high to seek an approval in that patient subset. So would be great to get your thoughts on that? Thanks.

Speaker 2

Okay. I don't know, Suresh, do you want to start? And then I can chime in.

Speaker 9

Yes. Regarding the first question, you asked about Why starting the 3rd study? In deciding when to start the 3rd study, When you look at the landscape, including how many studies are being run right now and what countries they are run-in and what are being conducted, We believe this is appropriate time to initiate this study and major depressive disorder in adjacctive treatment is a great near term opportunity, Similar to our clinical development strategies followed in our other mood disorders program, for example, the bipolar depression program, It is prudent to add additional trials. It's a good decision and it highlights Our commitment to expanding Replita in that institution. In In terms of the second question about the mix features, as we have indicated, the readout of the study, we are expecting In this quarter, and the readout will depend on how strong the results are.

As we have indicated in the previous It depends on what the results show and we will have to go to the FDA and discuss present our data. That's what we have indicated to the FDA. Once we go and discuss based on the results, we will know the next path. I want to also remind that there has not been a path established For approval in mixed features, while there is path established for adjunctive treatment, the Mixed features approval, there is no one with that indication, especially for the bipolar depression with mixed features or MDD with mixed features. There is not an indication for that yet.

So we would like to discuss that with the FDA. And our strategy It's mainly to expand across the mode disorder spectrum, both in unipolar and bipolar disorder. I think you had a question about other some other company doing this study and not having an approval that I cannot speak to that because I don't know what decisions were made internally.

Speaker 12

Understood. Thank you so much.

Speaker 0

Thank you. One moment for our next question. And our next question comes from the line of Charles Duncan from Canaccord. Cantor, your question please.

Speaker 13

Yes, from Cantor. Thanks, Sharon and team for taking our question and congratulations on Formative year last year. I think these are or this is a commercial question with 2 parts. One is actually related to last question in terms of the mix feature readout and strategy. We recently conducted a KOL call that suggested the KOL suggested that even a data publication would be picked up by And I know that you wouldn't mark it off label, but do you think that the label could encompass Prescribing in mix features patients.

And the second part is, what are you doing to prepare for The coming wave of muscarinic modulators is monotherapy in schizophrenia or do you think that that's a non event for your commercial franchise.

Speaker 2

Mark, do you want to start or do you want me to?

Speaker 3

Why don't you go ahead and start and I'll add some color

Speaker 2

Okay. I'll start with, the label. And I think that really what we need to do and you're right, we do not promote Anything off label. So what we would do is we're going to wait and we're going to see the data and we are going to go to the FDA with the data And assuming that it's very good, which we're, of course, hopeful for, that might Guide us towards a particular path. We will publish the results.

And Again, we're hopeful that the data is very good and physicians can read the papers. And I guess on I think it's a little premature to talk about and come to unlabel expansion based on these results because we don't know the results. On the muscarinic, I don't think again, our first approval was in cytopremia. Our next approval and the direction of the company is schizophrenia is important, but mood disorders are much larger populations and the indications that we are moving in with our expansion. We do think that So we do think that anything that's approved for patients with schizophrenia is A good thing, we look for anything that can help patients.

Remember, patients cycle through all of these drugs And we would look forward. We don't expect there to be any negative impact on us at all. First of all, They're still in the future, but we all I can say is we look forward to Having more options to treat patients. Mark, do you want to add anything to that?

Speaker 3

No, I think that's great.

Speaker 13

Thanks, Sharon, for the color.

Speaker 0

Thank you. One moment for our next question. And our next question comes from the line of Jason Gerberry from Bank of America. Your question please.

Speaker 7

Hey, good morning guys. Thanks for taking my question. So just wanted to drill in a little bit more on the selling and marketing investment step up. And really is sustained sales growth contingent on this sort of level of investment? Or is there a possibility as we get into 2024 where you can level off That investment and really kind of leverage this big step up in selling and marketing investment that we've seen in the last 2 years.

And then as I look at like 2022, half of the script growth came from nurse practitioners, roughly. And so it's a broader trend we see in mood disorder drugs in General, so just wondering if there's a connection at all to this sort of dynamic and the step up in selling and marketing investment.

Speaker 3

Yes, I can take that, Sharon. Yes, so when we made the decision to expand the sales force, what we were seeing is very strong demand for CAPITALYTA, Very positive reception in the marketplace. And as we analyze the data, we saw there was an opportunity to continue To fuel incremental growth, we've been pleased with the growth that we've been seeing. But as we always do with all of our investments, We're good stewards of the investment dollars that we have and we always look for opportunities that might yield even incremental And so in adding these 50 additional neuroscience specialists, What it will allow us to do is more frequently connect with high volume prescribers and also expand our reach And you mentioned NPs and PAs, and we would agree with you. Certainly, over the last couple of years, NPs and PAs In disease states like schizophrenia and especially bipolar depression have become a very important audience For us, they are very much a part of our target audience and we'll continue to Reach out to them to educate them on the disease and the benefits of CAPLYTA.

So hope that answers your question, Jason.

Speaker 0

Thank you. One moment for our next question. And our next question comes from the line of David Amsellem from Piper Sandler. Your question please.

Speaker 14

Hey, thanks. So I wanted to ask you about LAI Lumateperone and get your thoughts behind the rationale there. My understanding is that the LAIs are primarily in the schizophrenia

Speaker 4

Bipolar, more mania population. So as you're leaning more and more into depression, bipolar depression and then MDD, How do you think about the significance of an LAI form of Lumateperov? And I guess in the grand scheme of things in your pipeline, how important is it? Thank you.

Speaker 2

Sure. Thanks for the question. I'll take that. So I think that when we started looking at an LAI, we didn't have all the data that we have now As to Keplida's safety and tolerability profile and which as you know has Turned out to be very good. So we are developing an LAI.

We don't expect it to take over 50% of the population because of the fact that our oral drug is Has such a great efficacy and safety and tolerability profile. However, we do think That is an option for patients and can be an important option for some patients Who either are not compliant to once a day dosing or who simply just don't want to take the drug every day. So we think that it's nice to have. We don't think that again that it's going to take over Our oral franchise. We are also in our development Profile though, we are seeking not only a 1 month delivery, but we're seeking longer period of time, a 2 month delivery.

So hence, we're delivering we're developing a product that could be useful in both 1 2 months deliveries.

Speaker 14

Sharon, can you say if it's a subcu or an intramuscular? I don't know if you've ever mentioned that.

Speaker 2

I have mentioned it. The Phase 1 study that we did was a subcu. We've been looking at other Ways of administering the drug, so we are looking at both subcu and I'm And it turns out from a patient perspective, it isn't it really depending upon Your formulation, sometimes they like one over the other, but patients don't seem to mind an I'm injection. So we're looking at both sub Q and I'm

Speaker 1

Okay. Thank you.

Speaker 0

Thank you. One moment for our next question. And our next question comes from the line of Greg Sundar Navea from Mizuho. Your question please.

Speaker 5

Thanks. Good morning. Thanks for taking the questions and congrats on the progress. I've got 2 pipeline questions. My first just has to do with the mixed features study that we're About to get data for and my question is just given the trial design, where you do have MADRIS as an endpoint And given that it's likely to be mainly MDD patients or many MDD patients in the study, Is there a possibility that you could consider or you could propose to the FDA that this perhaps should be counted more as And MDD trial, so just wanted to get your thoughts around if that's part of the thinking.

And then secondly, I did also Want to revisit, the new five zero five study that you've announced. And I'm curious if The desire to add a study in any way is perhaps hedging against perhaps a negative result in 501 or 5 Thanks.

Speaker 2

I'll start with the second part and then I'll turn it over to Suresh. So, the Start of a new study is prudent. It is simply the way the CNS trials are run. It's the way we've conducted our other programs. We did this in bipolar.

We did it in schizophrenia. You see every Sponsor conducts several trials within an indication. So I don't think there's anything Any magic here, anything special here. I think we always think it's prudent to have Several shots on goal. And so we thought it prudent to have started another study.

And into the timing of the study, you look around at the different countries, you look at how many other studies are ongoing. And we thought that this is the right time to do this, hence the start of the study. And Suresh, did you want to take the other part of the study of the question? Yes.

Speaker 9

Question. Yes, I think the next the first question was about The mixed features can then be used as a MDD study. So the mixed feature study is designed especially With 2 populations, we have the bipolar depression population and we also have the major depression population that is the unipolar depression. So we have approximately similar patients between each groups. And also, this patient population has been enriched for mixed features.

So we use the diagnostic features of DSM-five Specifically enrolled patients only who meet the criteria for mixed features. So it would be difficult and it would not be I don't think that it will be

Speaker 2

Nor would we want to. These are patients with mixed features in each of these patient population.

Speaker 9

Yes, in that population.

Speaker 2

Right. And just to tell you, I mean, obviously, we don't have any of the results yet, but the way the study was designed, Patients were stratified, so we should have roughly equal patient populations in the bipolar and in the MDD patient populations.

Speaker 0

Thank you. One moment for our next question. And our next Question comes from the line of Ashburn from UBS. Your question please.

Speaker 10

Hey, thanks for taking my question. Congrats on the quarter. I had First, just can you elaborate on the new DTC campaign that you launched? It seems like it is making a decent buzz Based on some of the downstream metrics that we track, anything that you can share on how much of the spend is baked in for the DTC in your SG and A guidance for this year? That's first.

And then the second one, so on mixed features, like the feedback that we have heard from physicians indicates that patients are not specifically For mixed features, at least not extensively, and this would require some sort of like indication establishment. Want to understand if you think differently and can you provide any kind of an example of where psychiatry indication went through a similar path when it was Under treated to begin with and became a bigger market eventually. Thanks.

Speaker 2

We may need for you to I you blanked out on me a couple of times. I couldn't hear what you were saying. I don't know If anybody else could hear at all.

Speaker 3

I heard the first part of the question, Sharon, on DTC. I could start there, if you'd like. Sure. So, yes, hi, Ash. We did recently launch The next iteration of what we call our Lead in the Light DTC campaign, this is a broad national campaign that we're implementing.

We're implementing it through television ads, digital platforms, social media platforms, all with the intention Seeking to continue to raise awareness of the very significant unmet need, both in bipolar 1 and in particular bipolar 2 depression and educate patients on the potential benefits of CAPITALYTAB. And yes, we'd agree, we're seeing the same Positive metrics that you're seeing, which is the reasoning behind continuing the campaign and evolving it and building upon it, Our media is successfully targeting and reaching the bipolar depression audience. We know that from the metrics we're looking at. When we're on air, we drive substantially more visitors to our website looking for information about Kapylita and bipolar depression. And also on the back end, when we survey physicians, they an increasing number of physicians are reporting an increasing number of patient requests For Capalita, and we would expect this to increase as our ad continues to air.

So yes, we've been pleased with the campaign. We're seeing the positive metrics, and that led to the decision to continue it. I don't know, I can turn it over to Larry. I don't know if Larry has a comment On the spend, we don't typically specifically talk about the components of our selling and administrative spend. But Larry, I don't know if you have any comments that you'd like to add to that?

Speaker 4

No, I have nothing to add to that.

Speaker 2

Okay. And then Ash, we're going to have to ask you to repeat. I know you had a bunch of questions in there. I'm sorry. We couldn't I guess none of us could understand what was being asked.

So if you could ask me again, please.

Speaker 10

Sure. Yes. So just on Myxpederes, this is feedback that we have heard from physicians that Patients are not specifically treated for this indication, at least not extensively. Do you agree or disagree to that? And any example But you can give on other psychiatry indication that went through a path of being undertreated to becoming a bigger market.

Speaker 2

Sure. So I would agree with you that I do think that many psychiatrists do understand Mixed features and see patients and treat those patients with whatever they think Might be beneficial that's currently available, but you're right, there is no label for it. Until the DSM-five MDD with mixed features wasn't even specified and bipolar depression Was a much looser definition. So DSM-five has allowed Physicians to see a tighter definition and to be more educated. We agree with you that it is an education process Just like bipolar 2, physicians see bipolar 2 patients, they know it when there's nothing to treat patients with, It's more difficult.

So having the label for bipolar 2 is very helpful to physicians. And we would look forward to So we think there's a lot of opportunity here for education and to expand the awareness of the disease. I think bipolar II is a great example where It's now quite well defined with only a few treatments. I don't know Suresh, if you have any other examples off the top of your head.

Speaker 9

Other examples, not exactly the same, But at least something closer to that would be, if you think about the psychosis in Parkinson's disease, fopramirantin, there was nothing approved, but once that is there, that Similarly, Cardio Dyskinesia, it's a market that Neurocrine has done Extensively well with again, they have done a lot of educational campaign to highlight that importance of that.

Speaker 2

Those are great points, Suresh. Thank you. Okay. Operator, I think that it's time for us to wrap up. One more question.

Speaker 0

Certainly then one moment for our final question. And our final question for today comes from the line of Corinne Jenkins from Goldman Sachs. Your question please.

Speaker 12

Hi. This is Faruk on for Corinne. Just a couple for us. I believe you guided JV into the mid-30s range for 2023, but what do you anticipate in terms of cadence over the course of the year?

Speaker 4

Yes. Hi. Hopefully, I heard you. It was You're asking the gross to net for the guidance for the year and the cadence for that. Is that what you said?

Yes. Yes. I think our guidance gross to net will fluctuate as it does throughout the year, but I think you can be as we're comfortable in our mid-30s guidance here. I can't give any more granularity to that.

Speaker 12

Got it. Okay. Thanks. And on just the second question was that for MDD data, could it come as early as year end or should we expect that in 2024?

Speaker 2

So, what we've said on the MDD is that we expect to file in 2024. And that's I think the guidance that we're giving. Got it. Okay. Thank you.

Okay. Operator, I think with that, it's Time for us to wrap up, and we thank everybody for joining us today. We think 2022 It was a terrific year for us and for the launch of Keplida in bipolar depression. We look forward to more progress this year in 2023, and we look forward to update you on a quarterly basis. So thanks everybody for participating.

And operator, you can now disconnect.

Speaker 0

Certainly. Thank you, ladies and gentlemen, for your participation in today's