Vanda Pharmaceuticals Inc.

little to no resolution of the patient access issue this year, while the higher end of the range assumes improvement in patient access within this current period. Smith-Magenius syndrome launch. The launch of Hetlios and Hetlios-LQ for the treatment of adults and children respectively with nighttime sleep disturbances in Smith-Magenius syndrome continues to progress. We continue to work with SMS families and the SMS patient advocacy group, PRISMS, to improve awareness. To date, more than 90 patients with SMS have been prescribed Hetlios or Hetlios LQ. We plan to extend our awareness campaign with the goal of creating awareness among the community of approximately 15,000 SMS patients in the U.S. While establishing a trajectory of the number of patients on treatment at this time is difficult, we believe that the clinical profile of Hetlius and the degree of unmet medical need for patients with SMS provides a substantial growth opportunity in the future. Clinical development. Our Hetlius Lifecycle Management Program is robust. During 2021, we have initiated two large programs that represent important value creation opportunities for Vanda, delayed sleep-wake phase disorder, or DSWPD, and insomnia in autism spectrum disorder. If phase three has been initiated, DSWPD is likely the most prevalent circadian rhythm sleep disorder affecting approximately 1% of the population and 7 to 10% of patients with disorders of initiating or maintaining sleep. The prevalence of delayed sleep-wake phase disorder is highest in adolescents and young adults, with rates estimated between 3.3 and 4.6 percent, and some as high as 7 percent. We believe that head lures, with its circadian regulation mechanism of action, addresses the underlying mechanism of symptoms in DSWGPD by aligning the internal clock and therefore improving sleep at the appropriate and desired time. We're in the process of undertaking a large direct-to-consumer recruitment campaign to aid with the recruitment of the ongoing study, and at the same time, we're beginning to quantify DSWGPD patients seeking treatment for this disorder. I will now turn to tradipitant. The Phase III study of tradipitant in gastroparesis has completed enrollment, and we expect top-line results from this study by the end of the year. Following the completion of the study, we plan to meet with the FDA for a pre-NDA meeting and discuss our planned new drug application. As a reminder, The phase three study aims to enroll approximately equal number of gastroparesis patients with either idiopathic or diabetic etiology. The study is a 12-week double-blind placebo-controlled study, which measures the effect of Trediptant in improving the symptoms of gastroparesis. This phase three study follows the successful completion of a four-week phase two randomized study in the same population. The results of that study were published in the Journal of Gastroenterology in January of 2021. In that study, tradipidin met the primary pre-specified aim and achieved clinically meaningful outcomes in patients with gastroparesis. Tradipidin was shown to be well-tolerated with an adverse event profile similar to placebo. The overall benefit-risk profile, if confirmed, is likely to offer advantages over both approved and off-label treatments currently used. The effect of tradipitin in achieving complete response in nausea but also improving overall symptoms may suggest a disease-modifying effect through an action to the local neuromuscular network as well as the central nervous system centers for nausea and vomiting. The ongoing phase three studies of similar design compared to the phase two study with a few differences. First, this phase three study enrolled approximately 200 patients compared to approximately 150 in the phase two study. Second, the current study has a duration of 12 weeks compared to four weeks in the prior study. Third, in the current study, a vomiting episode during the screening period is required for inclusion And finally, in the current study, patients are stratified based on idiopathic or diabetic etiology in order to allow for independent and balanced efficacy analysis in each subgroup. A separate phase three, 12-week open-label study is ongoing and has currently enrolled over 250 patients. In addition, more than a dozen study participants have requested to continue treatment with tradipitant post-completion of the clinical study through an expanded access program. The majority of these patients have received FDA approval to continue treatment beyond three months, with the longest one of them with exposure currently of 15 months. Regarding gastroparesis and its prevalence, in a recent review by Camilleri et al., the authors highlighted that a population-based study in Minnesota in the United States estimated that the age-adjusted incidence of gastroparesis during the 10-year period was 2.4 patients per 100,000 personal years for men and 9.8 patients per 100,000 personal years for women. Prevalence was estimated to be 9.6 patients per 100,000 men and 37.8 patients per 100,000 women. Some individuals with typical symptoms of gastroparesis may never undergo confirmatory testing. One study estimated that as many as 1.8% of the general population may have gastroparesis, but only 0.2% are diagnosed. The others concluded that presumably this relates to a lack of awareness of the disorder, and existing diagnostic confusion caused by an overlap between the symptoms of gastroparesis and functional dyspepsia. Given this estimated prevalence, upon successful completion of the program, we see a significant commercial opportunity in creating awareness for both the condition and for sedipitant as a new pharmacological option for patients with gastroparesis. Our clinical pipeline programs are advancing, including, among others, the FNAPT bipolar and long-acting injectable studies and the study of tradipitin in motion sickness. To conclude, we're focused on improving patient access to HETIOS for non-24, as we're increasing awareness for HETIOS and HETIOS-LQ for SMS patients as well. The clinical program of trade dividend is nearing completion and we look forward to the results of the phase three study and continue discussions with the FDA regarding the regulatory path to approval and preparing for commercial loans. With this, I'll turn it to Kevin.

Thank you, Mahalis. I will begin by summarizing our financial results for the first nine months of 2021 before turning to discuss the third quarter of 2021. Total revenues for the first nine months of 2021 were $200.7 million, an 11% increase compared to $180.5 million for the same period in 2020. Ketlios net product sales of $129.5 million were the primary contributor and driver of our revenues for the first nine months of 2021 and saw an 11% increase compared to $116.5 million for the same period in 2020. FNAP net product sales of $71.2 million, for the first nine months of 2021 reflect an 11 percent increase compared to $64 million for the same period in 2020. For the first nine months of 2021, VANDER recorded net income of $26.1 million compared to net income of $15.1 million for the same period in 2020. Net income for the first nine months of 2021 included an income tax provision of $7.7 million as compared to an income tax provision of $5.6 million in the same period in 2020. And as cash, cash equivalents and marketable securities, referred to as cash, as of September 30th, 2021, were $406 million, representing an increase of $57.4 million compared to September 30th, 2020. Turning now to our quarterly results. Total revenues for the third quarter of 2021 were $70.1 million, a 16% increase compared to $60.3 million for the third quarter of 2020. Ketlios net product sales were $45.6 million for the third quarter of 2021, a 15% increase compared to $39.6 million in the third quarter of 2020. Schnapps net product sales in the third quarter of 2021 were $24.5 million, an 18% increase compared to $20.7 million in the third quarter of 2020. SNAP net product sales in the third quarter of 2021 increased by 5% as compared to $23.4 billion in the second quarter of 2021. SNAP prescriptions in the third quarter of 2021, as reported by Equivia Exponent, were essentially flat as compared to the second quarter of 2021. For the third quarter of 2021, Vanda recorded net income of $7.8 million compared to net income of $5.9 million for the third quarter of 2020. Net income for the third quarter of 2021 included an income tax provision of $3 million, as compared to an income tax provision of $2.5 million for the same period in 2020. Operating expenses in the third quarter of 2021 were $59.3 million, compared to operating expenses of $52.6 million in the third quarter of 2020. The $6.7 million increase was primarily driven by higher R&D expenses related to the late-stage, codependent, Hetlios and FNAP development programs as well as our early-stage development programs, partially offset by lower SGN expenses related to awareness and branded DTC campaigns. Vanda is providing an update to its prior 2021 guidance. Vanda expects to achieve the following financial objectives in 2021. Net product sales from both Hetlios and Finaft of between $260 and $290 million. This compares to prior guidance of between $270 and $300 million. Hetlios net product sales of between $170 and $190 million. This compares to prior guidance of between $180 and $200 million. FNAP net product sales of between $90 and $100 million. Year-end 2021 cash of greater than $400 million. Vanda is revising its full year 2021 Hetlios net product sales guidance to between $170 and $190 million. Prior full-year 2021 Hetlios net product sales guidance of between $180 and $200 million was based on key assumptions around Hetlios demand and payer approval rates, among others. Hetlios demand, measured by prescriptions received, has been consistent and continues to far exceed the prescriptions filled. Payer approval rates were expected to be in line with historical trends. However, reimbursement challenges from payers to fill Hetlios prescriptions for patients with non-24 have increased significantly. Banda is working with patients in an effort to improve their access to the only FDA-approved treatment for their condition. Given these challenges and the timing during the year, we've revised downward our full year 2021 Hetlios Net Product Sales Guidance. The lower end of the revised guidance range assumes minimal to no improvement in patient access and reimbursement challenges in the fourth quarter, while the high end of the revised guidance range assumes improvement during the period. With that, I'll now turn the call back to Mahalas.

Thank you very much, Kevin. At this point, we would be happy to answer any questions you may have.