Axsome Therapeutics, Inc.

Hello, and welcome to the Axiom Therapeutics first quarter 2023 financial results conference call and webcast. If anyone should require operator assistance, please press star zero on your telephone keypad. A question and answer session will follow the formal presentation. You may ask a question at any time by typing it into the ask a question feature on your screen. As a reminder, this conference is being recorded. It's now my pleasure to turn the call over to Mark Jacobson. Please go ahead, Mark.

Thank you, operator. Good morning and thank you all for joining us on today's conference call. This morning we issued our earnings press release providing a corporate update and details of the company's financial results for the first quarter of 2023. The release crossed the wire a short time ago and is available on our website at axon.com. During today's call, we will be making certain forward-looking statements. These statements may include statements regarding Among other things, the efficacy, safety, and intended utilization of our investigational agents, our clinical and non-clinical plans, our plans to present or report additional data, the anticipated conduct and the source of future clinical trials, regulatory plans, future research and development plans, our commercial plans regarding synoviality and our pipeline products, revenue projections, and possible intended use of cash and investments. These forward-looking statements are based on current information, assumptions, and expectations that are subject to change and involve risks and uncertainty that may cause actual results that 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. We are cautioned not to place undue reliance on these forward-looking statements which are only made as of today's date, and the company disclaims any obligation to update such statements. Joining me on the call today are Dr. Ariel Tabuto, Chief Executive Officer, Nick Peavy, Chief Financial Officer, and Lori Engelbert, Executive Vice President of Commercial and Business Development. Ariel will provide an overview of the company and progress made in the first quarter of 2023, as well as upcoming milestones. Following Ariel, Nick will review our financial results And then Lori will provide a commercial update. We will then open the line for questions. Questions will be taken in the order they are received. And with that, I will turn the call over to Ariel.

Thank you, Mark. Good morning, everyone. And thank you for joining Axone Therapeutics first quarter, 2023 financial results and business update conference call. We saw strong performance in all areas of our business in the first quarter, which included Advancing the commercialization of Ovelity and Synozy. Progressing our late stage product pipeline. Out-licensing XUS rights for Synozy. And strengthening our financial position. Total net product sales in the quarter were 28.8 million, driven by strong performance for Ovelity and solid performance for Synozy. Based on the current prescription trends, We are pleased that our two marketed products are now helping a growing number of patients living with depression and with excessive daytime sleeviness. Later on the call, we will provide further details on our commercial performance for Ovelity and Synosi. The first quarter was an important milestone for Axon as it was the first full quarter of sales for Ovelity. We have also had control of the US rights to Synozy for about one year. Earlier in the quarter, we announced the out-licensing of our ex-US marketing rights for Synozy in Europe, the Middle East, and North Africa to PharmaNovia. PharmaNovia shares our excitement and commitment to maximize the potential of Synozy for patients worldwide. We continue to see significant potential for Synozy both in the current indications as well as in potential new indications. With regards to new indications, we remain on track to initiate a phase three trial of sol-reamphytol, the active molecule in Synose in ADHD in adults in the second quarter. In addition to sol-reamphytol for ADHD, the rest of our leading CNS pipeline includes AXS07 for migraine, AXS12 for narcolepsy, AXS14 for fibromyalgia, and AXS05 for Alzheimer's disease agitation and for smoking cessation. For AXS07, our developmental candidate for the acute treatment of migraine, manufacturing activities are moving forward to enable the resubmission of this NDA, which is slated for the second half of this year. With AXS12, our product candidate for the treatment of narcolepsy, We continue to expect top line results from the pivotal phase three symphony trial in the first half of this year. With AXS14, our product candidate for the treatment of fibromyalgia, manufacturing, and other activities related to preparation for the planned submission of an NDA are continuing. And we expect to be in a position to submit the NDA for this product candidate in the second half of this year. With regards to XSO5 for the treatment of Alzheimer's disease agitation, enrollment in the phase three advanced two trial is progressing, and we anticipate completing this trial in the first half of 2024. In addition, we plan to initiate a phase two three trial of XSO5 in smoking cessation in the fourth quarter of 2023. In sum, we expect the next 12 to 18 months to be eventful, as we drive the commercialization of Avelity and Synosi, and as we advance our research and development pipeline. I will now turn the call over to Nick, who will provide details of our financial performance.

Thank you, Ariel, and good morning. Today I will discuss our first quarter results and provide some financial guidance. Total revenue in the first quarter of 2023 was $94.6 million, consisting of net sales of our two commercialized products, Avelity and Synosi, the revenue from the Senosi Europe and MENA Outlicensing Agreement signed with PharmaNovia, and royalty revenue from Senosi sales recorded by PharmaNovia. Fidelity net sales in the first quarter were $15.7 million. There were no net sales in the comparable period. Senosi revenue for the quarter was $13.2 million. U.S. Senosi sales were $11.2 million. International Senosi revenue was $2 million, including approximately $300,000 in royalty revenue from Cenosi sales in the outlicensed markets. As a reminder, there was a change in the distribution model during the quarter, which negatively impacted Cenosi net sales by an estimated $3.3 million. There were no net revenues in the comparable period for Cenosi. Cost of revenue was $7.6 million in the first quarter, compared to none in the prior year. In addition to the manufacturing costs for Rivaldi and Cenosi, Cost of revenue includes a one-time charge of $5 million in licensing sharing fees from the upfront payment received in the first quarter. Therefore, cost of revenue excluding this one-time charge was approximately $2.6 million. Research and development expenses were $17.8 million for the first quarter versus $12.6 million for the comparable period in 2022. The increase was primarily related to higher personnel costs associated with supporting the ongoing clinical trials, post-marketing commitments for Senosi and Avelity, and non-cash stock compensation expense. Selling, general, and administrative expenses were $74.2 million for the first quarter versus $25.7 million for the comparable period in 2022. The increase was primarily related to commercial activities for Avelity and Senosi and higher non-cash stock compensation expense due to the build-out of both commercial teams. Net loss for the first quarter was $11.2 million, or $0.26 per share, compared to a net loss of $39.6 million, or $1.03 per share, for the comparable period in 2022. The decrease in net loss for the first quarter versus the comparable period was primarily due to product sales from Eveldi and Sinosi, offset by higher selling general and administrative expenses related to these commercial activities, and license revenue received from PharmaNovia. We ended the quarter with $246.5 million in cash and cash equivalents compared to $200.8 million as of year end. During the first quarter, we did not utilize our ATM facility. In January 2023, we amended our loan agreement with Hercules Capital to increase the size of the facility to $350 million to reduce the interest rate and to extend the maturity and interest-only periods while accessing a $55 million tranche. We believe that our current cash balance, along with the remaining committed capital from the $350 million term loan facility with Hercules Capital, is sufficient to fund anticipated operations into cash flow positivity based on our current operating plan. I will now turn the call over to Lori, who will provide a commercial update.

Thank you, Nick, and good morning, everyone. We are off to a great start for 2023, and Q1 marked another exciting quarter for Axiom. with continued commercial growth for both Avellity and Senosi. We are pleased with the early metrics on Avellity, which all point to a strong launch with significant long-term potential, and with how the relaunch efforts on Senosi are progressing. I will share key metrics from our commercial efforts for both brands, starting with Avellity, followed by Senosi. The end of Q1 represents the first full quarter of sales for Avellity, and only five full months post-launch. We are still early in the launch, but remain highly encouraged by the consistent feedback from patients and HCPs. Approximately 31,000 prescriptions were reported in Q1 for availability, representing a growth of 298% in Q1 versus Q4. We saw prescription growth accelerate through increased depth with our early HCP adopters, as well as increased breadth of new prescribers. At the end of Q1, availabilities prescriber base grew to over 6,000 unique HCP riders versus 2,200 unique HCPs at the end of Q4. HCPs wrote prescriptions for over 15,000 new patients in Q1, bringing the total number of unique patients on availability to over 21,000 at the end of Q1 versus 6,000 at the end of Q4. Our highly experienced field force continues to drive adoption by educating HCPs on the product profile of Avelity. Through high impact engagements such as detailing and peer-to-peer speaker programs, our field force has now reached over 22,000 HCPs since launch. With regard to payer coverage, coverage for Avelity across all channels is currently approximately 65% of all covered lives. In the commercial channel, which is expected to be the primary channel for Avelity, Coverage is now at approximately 40% of covered lives, and we look forward to additional formulary decisions in the coming months. In the Medicaid and Medicare channels, approximately 100% of lives are now covered. Overall, payer coverage for ability is proceeding as expected during the standard six to nine month post-launch period, and we expect additional formulary decisions in the coming months. We remain pleased and extremely encouraged by the initial launch progress and are steadfast in our commitment to our launch focus of driving HCP adoption, empowering patients, and enabling quality access. Major depressive disorder, or MDD, is highly prevalent in a major public health concern with a mental health crisis that the US is currently facing. 21 million US adults were diagnosed in 2020. and there is a reported significant increase in prevalence as a result of the pandemic. Ovelity is an important new therapeutic option for patients living with this chronic and devastating condition, and we are proud of our efforts to make Ovelity available to patients living with MDD and their physicians. Turning to Synosy. In the first quarter, total prescriptions for Synosy in the U.S. grew 13% year-over-year and 4% quarter-over-quarter. Synose generated this growth despite a flat overall market and typical Q1 challenges. Payer coverage for Synose remains broad, with 96% of commercial lives and 83% of total lives covered. The growth potential for Synose in the current approved indications remains substantial. As a reminder, Synose is the first and only DNRI for excessive daytime sleepiness and obstructive sleep apnea and narcolepsy, and the first and only weight promoting agent proven to improve wakefulness through nine hours. Synosi is the only branded therapy available for patients who suffer from EDS and OSA, and we expect our increased and enhanced promotional and disease education efforts to drive continued growth for the product in 2023. We recently launched our new all-day campaign for Synosi. The new campaign includes updated creative content, additional HCP and patient support tools, and new educational resources. Launching this new campaign is an important next step in the relaunch of Synosi, and I look forward to updating you on our commercial efforts and results related to the Synosi relaunch in the coming quarters. Our two commercial products, Ovality and Synosi, address serious, highly prevalent conditions and bring meaningful innovation to millions of potential patients. I will now turn the call back to Mark to lead the Q&A discussion.

Thank you, Lori. Operator, may we please have our first question?

Thank you. If you'd like to be placed into question queue, please press star 1 at this time. One moment, please, while we poll for questions. Our first question is coming from Charles Duncan from Cantor Fitzgerald. Your line is now live.

Hey, good morning, Ariel and team. Congratulations on, yeah, a great quarter for Avelity. Nice to see out of the gates. I had a couple of questions, one commercial, one development or pipeline. Regarding the commercial question on availability, I'm wondering if Lori can provide any more granular feedback on what she has heard from prescribers hearing from patients in terms of those patients have been on other drugs in the past and how this differentiated mechanism is helping them feel and the potential for persistence. Thanks.

Hey, Charles. Good morning and thanks for the question. So, you know, I think the best way to answer that is to, one, take a look at script trends and how many patients we actually added in Q1. You know, we added over 15,000 patients in Q1, and so physicians are clearly seeing a benefit of the product. So we're also seeing a really healthy refill rate right now. And I think that's really going to speak to the persistence and compliance. It's still a little bit too early. You know, into Q1 was only five months into launch. Still a little bit too early to see true trends on persistency and compliance, but the refill rate is really, really healthy.

And I guess I can assume... can we assume that now almost halfway through the second quarter you feel pretty good about doing a business?

Absolutely. As I mentioned in the prepared remarks, we are really heavily investing in the optimization of the product in terms of all the omni-channel approach we're taking from a marketing standpoint, strategic media, congresses, speaker programs, Our field force, you know, with high-impact engagements, and I qualify high-impact engagements with, you know, either detailing the physician and or speaker programs, you know, they've reached over 22,000 HGPs, and that's a lot of HGPs with, you know, and so we're really happy.

And moving to the pipeline, I struggled to ask just one question, but I will ask just one question for Aereo. because you've got a lot of things going on. I guess on 05, let's talk about that. You mentioned advance to enrollment is proceeding well. I'm wondering if you, on a blinded basis, feel good about the phenotype of the patient that you're enrolling and if you can provide us any color. And then if you've learned anything from the recent Rick Zolte adcom in terms of Alzheimer's agitation, how does that you know, impact, change, or not, your strategy with regard to O5 and Alzheimer's agitation?

Thanks, Charles, for the questions. With regards to the types of patients that we are enrolling in Advance 2, I think we feel comfortable that we are enrolling a very similar type of patient as we enrolled in Advance 1. The protocols are very similar. The entry criteria are very similar. I think the team is executing on enrolling the study and making sure that we have the right patients and that we have a quality trial again. With regards to any learnings from the recent panel, there are a few observations. One is it became clear or it's been clear to us, but now I think it's been made publicly clear that the FDA, as well as experts, really feel that this is a high unmet medical need. What the panel highlighted was the seriousness of the condition and the quandary, frankly, that physicians find themselves in with no drugs that are approved, and the only drugs that are used off-label broadly are antipsychotics, which are problematic. So it's gratifying to be able to share that more broadly, that awareness. The other learning from the panel is that the way that we are going about developing the product is consistent with how the FDA views that it should be developed in terms of endpoints. And, again, this is not anything which is new to us because we've always worked very closely with the FDA for this breakthrough therapy designated product candidate. But it's nice to see those points discussed in a public forum.

Very good. It's consistent with our past diligence. So appreciate the added color. And good luck with that, with all the stuff going on on the pipeline. I'll hop back in the queue.

Thank you. Next question is coming from Jason Gerberry from Bank of America. Your line is now live.

Hi, good morning. This is Dina on for Jason. Congrats on the progress this quarter and thank you for taking our question. Just a couple on Avelity here. How much did Avelity 1Q benefit from inventory stocking? And do you have a firmer handle on the full year growth to net pricing dynamics? Or is that still more of a second half of the year event when you get to a more normalized rate? Thank you very much.

Hey, Gina, it's Nick. Thanks for the question. The performance for availability was not impacted by changes in inventory level. As we stated previously, normal inventory levels are at around two weeks. And during the quarter, there was actually a modest decrease in days on hand of availability. to the distributors. So overall, it was not impactful at all to the net sales. In contrast for Sanosi, as we mentioned, there was an impact of $3.3 million due to the change of title. Reported sales would have been $3.3 million additional had there been no change on that. And I think your second question related to how do we think about GTN for the remainder of the year, We're still not currently in a position to give specific guidance around GTN, as it's going to be volatile in the short term. Obviously, there's coverage mix that's going to be – sorry, there's mix and channel throughout the year that we're going to have distribution. Coverage is going to be dynamic and coming online as we've seen it. It's going to continue to come online throughout the year. And then also the utilization of the copay card. So while we are pleased with the GTN this quarter, We don't expect it to improve in the near term.

Great. Thank you so much, and congrats again on the progress this quarter.

Thank you. Our next question is coming from Mark Goodman from SVP Securities. Your line is now live.

Yeah, could you give us a sense of commercial coverage, how you're planning that? I know that it's been kind of a slow process at the beginning on purpose. I was wondering, you know, is this going to speed up as the year progresses? And, you know, how much of an impact did, you know, volumes get held by the one contract that you've talked about already? And then second question is just the SG&A run rate in the quarter. Just give us a sense of is that the run rate going forward? Should we expect that to kind of ramp from there or do that include some upfront, you know, costs for the year? Thanks.

Yeah. Hey, Mark. Good morning. I'll address the first question and pass it over to Nick. So, you know, as we stated before, we have expected, you know, access to start coming online around six to nine months post-launch, and given, you know, we are barely at six months when we're at 65% of lives covered, we're feeling pretty good about, you know, where we're at with lives covered, and we do expect that to continue to evolve over the course of the next few months to the rest of the year. I wanna talk about just volumes in terms of the contracts that we had in place. We don't necessarily look at it that way. I'll give you some numbers to think through, and that is 90% of patients who've been prescribed Abelity have failed first line therapy. 60% of patients are second and third line. And this is exactly where we would expect patients to be right now. One, because there's an urgent and unmet need out in the marketplace, but two, as they work through formulary access. And so we are seeing a healthy amount of patients using the product later line, obviously with nice success and the continued improvement in terms of moving the lineup therapy up. Part of that is helped by the fact that we have a robust patient support services program in place, and the patient support services program is really in place to make sure that patients that want to get on therapy are able to get on therapy.

Cool. Mark, I'll take the second part of your question on the SG&A. In actually Q1, we did have some one-time charges as related to the PharmaNovia license. While we're not offering specific guidance for the rest of the year, I would point you taking a look at what we spent in Q4 as well as Q1 as a ballpark of where we would expect to be, you know, in future quarters for 2023. Thank you.

Our next question is coming from David Amselin from Piper Sandler. Your line is now live.

Thanks. So, a couple for me. Can you just talk to qualitatively the kinds of patients who are getting the drug in terms of how many prior treatments you're seeing, prior exposure to SSRIs, SNRIs, bupropion, et cetera? That's number one. And then secondly, on riboxetine, I'm trying to tease out how you're thinking about the product in the context of the current treatment landscape, and particularly given that there's some mechanistic overlap with synosy, as you think about narcolepsy, you know, where do you see riboxetine, you know, fitting in commercially, of course, assuming that there's clinical success? Thank you.

Hey, David. I'll take the first one and then pop it over to the area. So, as I just mentioned to Mark, Right now we're seeing 90% of patients have failed one therapy, but that's not unusual or exactly as we'd expected. 60 to 65% have been on second or third line therapies prior. And so we are seeing later line use, which is exactly as we would expect coming out of the gate. Again, this is consistent with the unmet needs in that patient population. We are seeing obviously success as objective evidence shows from refill rates, as well as what we're hearing from the field. And as we, you know, access opens up and physicians get clinical experience, we do anticipate that that ability will move up on your line usage.

Great. And with regards to AXS-12 or riboxetine, you mentioned, you know, mechanistic overlap with Sanosi. And, you know, how would we think about the two products? So riboxetine is being developed for narcolepsy primarily for cataplexy. So what we saw in the Phase II trial was that there was a robust effect on cataplexy and also an effect on excessive daytime sleepiness. As a reminder, Synose has robust effects on excessive daytime sleepiness but is not approved to treat cataplexy. So the two products would be complementary. Now, we like the profile that we saw in the Phase II trial for AXS-12. And we're looking forward to seeing what the results of the phase three trial are. And that's going to inform us in terms of the full profile of the product.

That's helpful. If anybody's thinking of following up, do you think Roboxetine on cataplexy has to be markedly better than what we typically see for off-label uses of Roboxetine? of dual reuptake inhibitors like venlafaxine and duloxetine? Because I know there is some off-label use. How do you think about that?

That's a hard question to answer because, There have been no controlled trials with any of those agents, so a lot of it is anecdotal. What we can speak to is the profile of our product, and we think that the profile is very attractive. A drug which has an effect on both cataplexy as well as excessive daytime sleepiness, which is dosed during the day, which does not have a lot of the scheduling, or a lot of, frankly, the serious side effect concerns of the agents that are currently marketed.

That's helpful.

Thank you. Next question is coming from Jun Li from Truist Securities. Your line is now live.

Hey, thanks for taking our questions and for the updates. Sorry if I misheard, but I think I heard Lori just say that 90% of the patients has failed at least one therapy before getting on Ability. Does that mean that there are 10% who get Ability as first-line therapy? I just want to make sure I heard that correctly. And I have a follow-up.

Hey, June. Thanks for the question. There's always going to be some early-line use. It could be either data reporting or it could just be patients who are paying out-of-pocket, potentially. It could also be, you know, medical necessity writing through, you know, getting through This is just reported data that we're seeing, and we're seeing 90% have failed one prior therapy, which is exactly what we would expect at this point.

Has that share of first-line use gone up over time?

No, it's actually gone down.

Okay, got it. At high level, ability gross net for first quarter looks like around 50%. Is that in the ballpark? And if so, could we expect further improvement in that gross net, or do you think you're already at the more or less steady state gross net? Thank you.

Hey, Jun. Yeah, I think what I actually said is the GTN is in the high upper 50s is where it was for Q1, and we wouldn't expect that to materially change or improve in the next future quarters. Thank you.

Thank you. Next question today is coming from Rickon Poorhead from Morgan Stanley. Your line is now live.

Hi, good morning. Thanks for taking our questions. So first, just a quick clarification question for ADA. Could you just remind us exactly which data sets you plan to include in the eventual filing for ADA, assuming your data set would advance to matures positively? And then secondly, for AXS12 in narcolepsy for the symphony data readout you expect in the coming months. Could you remind us what the study's power to demonstrate and what you would consider a strong clinically meaningful outcome here? Thanks. Thanks for the questions.

With regards to Alzheimer's disease agitation, in the filing, so in the S&D filing, we would include the results from all the studies that we conducted. As a reminder, we've completed the ADVANCE-1 trial, which is a pivotal trial. The ADVANCE-2 trial, those data will also be included, so that mirrors the ADVANCE-1 trial. Also, data from the ACCORD trial will be included. as well as data from the open-label safety extension trial, so the long-term open-label safety extension trial. So it'll be a pretty full package, and we look forward to reading out the Advance 2 trial, and if that's positive, then filing the SNDA. And with regards to AXS-12 in terms of the powering of the study, So the study is 90% powered to detect a change on the cataplexy endpoint. So that's the primary endpoint. So we've not disclosed what that delta is that we are expecting. But what we can point you to are the results from the CONSERV trial, the phase two trial. And it was based upon those results that we powered our study.

Thank you. Next question is coming from Yatin Saneja from Guggenheim Partners. Your line is now live.

Thank you. A couple questions for me. I don't know if you articulated what the exact gross to net was or what the approximate gross to net was for Q1, so that's one. Any thoughts on providing guidance for sales for a relative when you might do that? And then if you can articulate for us the cadence of patients, you know, whether it's a weekly cadence or a monthly cadence, where it is, how do you expect that to change over time?

Hey, Yadin. Again, gross net for availability in the quarter was in the high upper 50s. This was an improvement from the 60s in Q4, and it was due to a higher proportion of refills of scripts versus new scripts. Again, we're very pleased, obviously, with the GTN this quarter, but we don't anticipate it to improve in the near term. And then as it relates to the sales guidance, we're in the very early stages of the launch of the LLD, along with acquiring Synosy just up to a year now. And as such, we find it just real premature to provide any such guidance, as there's multiple variables that can affect this number. I think, Laura, you want to answer the last question?

Yeah, yeah, I'm 100% sure. the, you know, what you meant by the question, but, you know, the scripts are written on a monthly basis, so patients are, you know, we are tracking monthly prescriptions.

Thank you. Next question is coming from Joseph Tome from TD Cal, and your line is now live.

Hi there. Good morning. Congrats on the quarter, and thank you for taking my question. Maybe the first one on AXS-12. I know you said the focus is largely going to be on the cataplexy endpoint, but do you anticipate releasing sleepiness scores as well when you report the full data? And then just as you think about the filing package, you know, if these data are positive here, can you comment on the safety database and sort of CMC metrics? Are you ready to file a submission if the data are positive or kind of where do you fall on that? Thank you.

Sure, thanks for the question. So when we report top line results historically, we've reported a number of different endpoints. So we don't expect the Symphony readout to be any different. So we'll try and provide as much information as we can given the constraints of reporting top line results from large data sets. And with regards to the filing package, in terms of the safety database, We still need to finalize with the FDA what would be included in the safety database, but preliminarily, we have a lot of safety data. So we're collecting safety data not only from the studies that we have conducted, but also as a reminder, we did in-license a very large patient safety database for riboxetine through our Pfizer agreement. And on the CMC front, things are progressing well there. So we do manufacture, we do synthesize the API ourselves. So right now that's been going smoothly and everything's been going smoothly on the CMC side. And then with regards to when we would actually be able to file an NDA, a gating factor will be the completion of the long-term safety study. So, assuming that we do have success with the symphony trial, we would expect being able to file an NDA likely in 2024.

Great. That's very helpful. Thank you. And then maybe, Laurie, definitely helpful on the prescriber base and sort of unique writers. Can you go into a little bit more detail in terms of how physicians are prescribing this? Are they trying it first in one patient, and then if that goes well, you know, they go in other patients? Once you get a writer, do they write a lot of prescriptions? Kind of how is it getting these physicians on board, and how will that change kind of for the duration of the year, do you think? And thank you.

Yeah. Yeah, that's a great question. So consistent with expectations of launch, you have your early adopters that come out of the gate prescribing, and those, you know, if they have clinical success, those have, you know, they have tremendous depth. We are seeing exactly that. The writers out of Britain, they have really incredible market share in terms of their use of ability, so they're seeing positive clinical experience. And then as you move further along with the launch and you're trying to increase your breadth, then you start seeing writers that are on an adoption curve that may need a little bit more time in market, understanding peer influence, or they may need clinical experience from one patient before they write more. So we're starting to get into that, and our breadth is starting to grow. As I mentioned, in Q1, we added 3,800 new unique HTTP writers, and so we definitely expect that to continue to grow, just as a normal adoption curve would progress.

Perfect. Thank you very much.

Thank you. Next question today is coming from Greg Sivani from Mizuho Securities. Your line is now live.

Okay. Thanks so much. Congrats on the quarter. I had a couple of questions. Just wanted to get a sense of maybe philosophically speaking where you are in terms of your commercial infrastructure and whether given the opportunity you're content to keep it sized the way it is right now or Do you feel that perhaps you can be opportunistic and further drive even perhaps better uptake of Elodie in particular? And then secondly, just wanted to get a sense of just going back to the gross to net and maybe just for clarification on my end, just can you tell us how exactly you go about calculating your gross to net? I just want to make sure that I'm thinking about it the same way you're thinking about it. Thank you.

Nick wants to go first.

Cool. Hi, Craig. So GTN, I mean, it's basically the way everybody else would essentially calculate gross to net. It's based on demand in the quarter and the utilization of copay card, any type of rebates, any additional adjustments as well. That all goes into GTN. We would also approve for anything that was sold in the quarter that's sitting in the channel that has not been distributed to the pharmacies at that point. So that would also be considered part of the GTN adjustment for the period. Laura, you want to answer the second one?

I'm not sure if you're meaning the Ability Field Force or the Synocy Field Force, but I'll try and answer both because the answer is pretty applicable across both. Just to give you some perspective on the Ability side, there are about 50,000 HGPs who prescribe really the lion's share of branded therapies. We are calling on 25,000, 26,000 HGPs of those 50, but those 25,000 that we're calling on, they write almost 70% of the branded therapies. Our DCC platform, you know, was intentionally structured so that we could, you know, maintain a share of voice, you know, either through reach or with our omnichannel marketing of field forces, you know, in some cases two times the size of what we have. Remember, our DCC platform was really set up so that we could optimize productivity through effective and efficient engagements, and right now we are seeing that with our HCP targets. as we're able to reach as many targets as, again, sales forces that are somewhat upwards of two times the size that we have right now. So, you know, as we are continuing to invest in both Avelity and Synosy through omnichannel marketing, strategic media, Congress spending, speaker programs, as I've mentioned before, we will obviously continue to make sure that we're maximizing the opportunity for both products.

Yeah, and what I would just add to what Laurie said is that right now, our marketing efforts and the yield from that is going exactly as we had expected, exactly as we had planned. You know, we've said before that our field force sizing and targeting was based upon all of the data and information that we've looked at through our DCC platform. And so we feel that we are more than adequately resourced right now. We're very happy with the way that the launch is going. Obviously, anything can change, and we are an organization that can be flexible. But for now, we're adequately resourced.

Thank you. Next question is coming from Miles Minter from William Blair. Your line is now live.

Thanks for taking the questions. Congrats on the quarter. Can you just comment on the proportion of those 31,000 scripts for a validity that are being reimbursed or seeking reimbursement through the commercial versus government channels? And does that differ materially from the broader branded antidepressant market, which I think is two-thirds commercial, one-third government?

Yeah. Hey, Miles. We are seeing exactly almost almost exactly what we see in the broader antidepressant category. So the broader antidepressant category is about 60% to 65% commercial in the remaining government channel, and that is spot on. We may be feeling a little bit heavier to commercial. I think we're around 70% right now, but it's exactly as expected.

Okay, cool. And then the second one is just on the symphony trial. You mentioned that powering assumptions are like during concert. Does that mean that the baseline cataplexy rates over the week are going to be similar between those two trials when they're read out?

So the entry criteria are similar. And whether or not the actual numbers are the same, that remains to be seen. But the entry criteria are similar. There's a lot of variability with regards to cataplexy in patients. And part of the reason for that is that cataplexy, although it is a symptom that everybody has, it is triggered. So there'll be variability amongst individual patients based on their social situations.

Okay, beautiful. Thanks for the question.

Thank you. We have time for two more questions. Our next question is coming from Matt Kaplan from Lattenburg-Thompson. Your line is now live.

Hi. Good morning and congrats on the results of the quarter. Just wanted to zero in a little bit on Sanosi Supplementazole in the ADHD indication and your plans for the Phase III program. Can you talk a little bit about the indication and need there and then your Phase III program initial study, would that be potentially sufficient for filing as possible?

Thanks, Matt, for the question. So, ADHC is a very large market. There are roughly 12 million patients in the U.S. who have ADHD, and right now they're treated either with stimulants, which have you know, issues with regards to diversion because they're highly controlled. These are drugs that are very effective, that have a very large effect size, but then there are the downsides from a safety perspective. And then there are the non-stimulant medications. The non-stimulant medications, what they suffer from are lower effect size. So there is a very large need still for effective drugs that are both effective and also that have a very good safety profile. We like Synose based on the comparison, let's say, in other indications. So in excessive daytime sleepiness, for example, where the clinical trial results show that it appears to be a superior agent to to other drugs, so to other weight-promoting agents, for example. And we also very much like the results from the SHARP study, which recently read out, where we looked specifically at cognition in patients with OSA, so it's not directly analogous, but we like the clinical profile of the drug in other indications. We like the mechanism of action of the drug. Also, we recently announced that it hits TAR1, which in preclinical models have been shown to be pro-cognitive. So there's a lot there that we hope to test in the upcoming trial, which we expect to start this quarter. And then with regards to what would be needed in order to file, so to file an NDA or an SDA4 drug in ADHD, you also do need to demonstrate efficacy in a pediatric population. So the study that we're about to launch, that is a study in adults, and we will be also looking to initiate a study in pediatric patients to enable a filing.

Okay. That's helpful. And then a quick question for Lori. In terms of some near-term NDA filings, can you talk about the launch prep you have underway for AXS 07 and potentially 14 as well, given the timing of those NDAs and filings?

Yeah, thanks for the question. So 07, if you remember, we got almost up to the finish line, so launch prep was pretty heavily done there. So in terms of marketing materials and preparation for the market and understanding, That's all just, you know, we'll need to do a refresh. Based on, you know, timing for both 7 and 14 will be when we decide, you know, size, structure, thoughts on Salesforce sizing. So once we have a little bit more understanding on exact timing and dates, then we'll share what that looks like.

Thanks for taking the questions.

Thank you. Our final question is coming from Raghuram Sabharaju from H.C. Wainwright. Your line is now live.

Hi, this is Boo Balan, dialing in for Ram Silvaraju, and thanks for taking our questions. A couple from us. So firstly, I'd like to get your thoughts on intracellular therapeutics, Lumotepirone, which produce positive top-line data as monotherapy in patients with MDD and bipolar depression. Were there any takeaways with respect to future clinical directions for AXO5 on this recently reported data?

Thanks for the question. With regards to the Lumetepirone and the data in mood disorders, it's not surprising that an antipsychotic would work in depression. I think it's well known that atypical antipsychotics are used as adjunctive treatment. Anytime any company generates data in depression or in bipolar depression, which is positive, we think that that's a great thing because the need is so large and the patient population is so large, and there's such a large amount of heterogeneity in terms of response from patients. So, yeah, that's great, and let's have more of that.

All right, thanks.

Thank you. We reach the end of our question and answer session. I'd like to turn the floor back over to management for any further or closing comments.

Well, thank you again for joining us on the call today. We saw strong performance in all areas of our business in the first quarter. We are executing on the commercialization of Abelity and Synosy, and we are advancing our late-stage pipeline to key milestones in multiple indications. Our marketed and development portfolio positions us to have potentially at least five marketed products by 2025, targeting brain disorders that affect tens of millions of people. And also, these are conditions where there's still a great unmet medical need. So we look forward to updating you on our progress during the rest of the year. Have a great rest of your day. Thank you.

Thank you. That does conclude today's teleconference and webcast. You may disconnect your line at this time and have a wonderful day. We thank you for your participation today.