ACADIA PHARMACEUTICALS INC Q3 2025 earnings call

Good afternoon, and thank you for joining us on today's call to discuss ACADIA's third quarter 2025 financial results. Joining me on the call today from ACADIA are Catherine Owen Adams, our Chief Executive Officer, who will provide some opening remarks, followed by Tom Garner, our Chief Commercial Officer, who will discuss our commercial brand's DAYBUE at NUPLAZID. Also joining us today is Elizabeth Thompson, PhD, Executive Vice President, Head of Research and Development, who will provide an update on our pipeline programs, and Mark Schneyer, our Chief Financial Officer, who will review the financial highlights. Catherine will then provide some closing thoughts before we open up the call to your questions. We are using supplemental slides, which are available on our website's events and presentations section.

Before proceeding, I would like to remind you that during our call today, we will be making several forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements, including goals, expectations, plans, prospects, growth potential, timing of events, future results, and financial guidance, are based on current information, assumptions, and expectations that are inherently subject to change and involve several risks and uncertainties that may cause results to differ materially. These factors and other risks associated with our business can be found in our filings made with the SEC. You are cautioned not to place undue reliance on these forward-looking statements, which are made only as of today's date, and we assume no obligation to update or revise these forward-looking statements as circumstances change, except as required by law. I'll now turn the call over to Catherine for opening remarks.

Thank you, Al. Good afternoon, everyone, and thank you for joining us today. I'm pleased to report another strong quarter for ACADIA, with solid execution across our commercial portfolio and continued momentum that positions us well for a strong finish to 2025 as we lay the foundation for sustained growth into 2026 and beyond. We delivered total revenues of $278.6 million this quarter, up 11% from a year ago, reflecting the strength of our commercial portfolio. This performance underscores our ability to execute on multiple fronts while building for future growth. Starting with DAYBUE, we're very pleased with our progress, following the expansion of our salesforce earlier this year, the benefits of which are now starting to materialize. I'm excited to share that we achieved our largest sequential increase in referrals since launch.

This meaningful sequential growth reflects the impact of our expanded team into the community setting, giving us confidence that we will continue to see benefits from our broadened physician reach. During the third quarter, DAYBUE generated $101.1 million in net sales. Including contributions from both U.S. sales and named patient supply programs outside the U.S. We shipped the highest number of DAYBUE bottles ever in a single quarter. In total, we've shipped to over 1,000 unique patients globally, an exciting milestone for the company. Importantly, patient persistency remains stable, underscoring the sustained benefit DAYBUE delivers to patients and their families. Moving to NUPLAZID, we delivered an exceptional quarter with net sales of $177.5 million, marking our strongest sales quarter ever. The momentum we are now driving gives us tremendous confidence in NUPLAZID's potential to unlock higher growth in the coming years.

To ensure we capture this opportunity, we're making strategic investments in a meaningful salesforce expansion. The impact of this sales team expansion, combined with our direct-to-consumer campaigns, creates a powerful combination that we believe will drive sustained growth and value maximization for NUPLAZID. We're looking to build on our commercial success by advancing our pipeline of novel product candidates, including the recent initiation of one phase II and one phase III trials. I'll now turn the call over to Tom to cover our commercial performance.

Thank you, Catherine. I'll begin with DAYBUE, where we delivered another strong quarter of commercial execution. DAYBUE sales were $101.1 million in Q3, representing our highest revenue and total prescription volume in any quarter to date since launch. As Catherine noted, for the first time since approval, the number of unique patients receiving DAYBUE worldwide exceeded 1,000 in a single quarter, for an actual count of 1,006. This achievement reflects not only our progress in the U.S., but also from patients now starting to access DAYBUE through our named patient supply programs internationally. We're seeing strong early indicators from our field force expansion. Referrals are leading the way, with the highest quarter-over-quarter increase since DAYBUE's launch in 2023. This momentum is translating into other key performance indicators, such as broadening prescriber reach, with 956 physicians having now written at least one prescription for DAYBUE.

Our sales teams are now gaining real traction, with call volumes on our expanded target customer base increasing over 20% versus Q2. Supported by a similar increase in the number of educational programs we delivered, both of which are important levers in helping to educate prescribers on the benefits that DAYBUE has to offer. Importantly, adoption is broadening beyond Centers of Excellence, or COEs, with community-based physicians accounting for 74% of new prescriptions in Q3. We're also seeing a meaningful uptick in scripts from nurse practitioners and physician assistants, reinforcing that our strategy to expand in-person efforts into the wider rep treating community is working. These trends position us well to reach more rep patients who could benefit from DAYBUE.

Even with this progress, overall market penetration remains relatively low at about 40% in the U.S., and only 27% in the community setting where the majority of rep patients are treated. This continues to represent a substantial growth opportunity for the brand. Looking at age demographics, penetration among patients under the age of 11 is over 60%, but amongst older patients is significantly lower, despite growing real-world evidence of DAYBUE's positive impact in this group. As we expand our reach beyond COEs, we see this segment as a significant growth driver for 2026 and beyond. Long-term persistency remains a key strength for DAYBUE, reflecting its sustained clinical benefit and strong patient engagement. With another quarter of maturity in our data, persistency rates remain above 50% at 12 months and greater than 45% at 18 months.

The strength of these metrics is important, as they further reinforce not only our confidence in DAYBUE's therapeutic value, but also our outlook for sustainable long-term growth in the U.S. Internationally, our named patient supply programs continue to gain traction. All three distribution partners are now actively shipping to patients in the EU, Israel, the Middle East, and Latin America. Looking ahead, we remain confident in DAYBUE's growth outlook, driven by sustained demand generation supported by our strategic field force investments, strong persistency metrics, and expanding global access. These factors are critical because they not only validate the long-term value of DAYBUE for patients, but also create a durable foundation for revenue growth. While we began to see the initial positive impact from the field force expansion in Q3, we expect meaningful benefits to accelerate through Q4 and into 2026.

In summary, DAYBUE is well positioned to capture significant market opportunities in the U.S. and internationally, reinforcing our commitment to delivering both patient impact and shareholder value. Now, turning to NUPLAZID, where we delivered record performance with net sales of $177.5 million. Representing 12% year-over-year growth, driven by 9% volume growth. This reflects strong underlying demand for NUPLAZID among patients with Parkinson's disease psychosis, or PDP, and the success of our commercial strategy, coupled with the unwavering focus of our customer-facing teams on executional excellence. Referrals were a key driver of this momentum, increasing 21% year-over-year. This growth signals increasing awareness and confidence among healthcare providers in identifying and treating Parkinson's-related hallucinations and delusions earlier in the course of the disease. New prescription volumes grew 23% in Q3 compared to the same quarter last year, representing the strongest year-over-year increase since 2019, and were up 9% sequentially.

This inflection point demonstrates that our patient engagement campaigns and HCP outreach are translating into tangible prescribing behavior. It also underscores their belief in NUPLAZID's differentiated profile as the first and only FDA-approved therapy for PDP, with a well-established safety and efficacy record. Taken together, we believe these trends are an important leading indicator of future prescribing behavior and reinforce the strength of NUPLAZID in meeting a critical unmet medical need. As a reminder, the U.S. PDP market represents a significant opportunity. There are approximately 1 million Parkinson's patients, with an estimated 50% experiencing hallucinations and delusions at some point during the course of the disease. This translates into a substantial number of patients who could benefit from NUPLAZID, underscoring the long runway for growth. Looking ahead, we see significant opportunity to build on this momentum.

Our reach and frequency model is driving broader prescribing patterns across a wide range of HCPs, and our direct-to-consumer campaigns are raising awareness of PDP symptoms while highlighting NUPLAZID as the first and only approved treatment. To fully realize NUPLAZID's long-term potential and capitalize on the brand's strong momentum, we are making strategic investments, including a 30% increase in our customer-facing team starting in the first quarter of 2026. This expansion will allow us to reach newly activated physicians and improve pull-through. We are approaching this expansion thoughtfully to maximize near-term efficiency and long-term impact. Our various consumer initiatives are driving awareness and creating demand, with our expanded field force ensuring we efficiently convert that demand into prescriptions. In summary, the NUPLAZID fundamentals are strong, the market opportunity is substantial, and we have a proven strategy designed to capture it.

With a differentiated product profile, accelerating demand indicators, and targeted investments in our commercial model, our ambition is not just to grow, but to become standard of care for these patients. I'll now turn the call over to Liz.

Thank you, Tom. I'm pleased to share some updates on our pipeline, where we continue to make encouraging progress across multiple programs that hold meaningful potential for the future. We've achieved some important milestones recently, including the successful initiation of our phase II study for ACP-204 in Lewy Body dementia psychosis and the initiation of our phase III study of trofinetide in Japan. Looking ahead, our next expected milestone is the initiation of a phase II study for ACP-211 in the fourth quarter of this year. We are developing ACP-211 in major depressive disorder, a common condition with significant unmet need. Then, in Q1 2026, we expect to initiate our first in-human study of ACP-271 in healthy volunteers.

To our knowledge, this will be the first time a GPR88 agonist enters the clinic, and it moves us along the path of development targeting the indications of tardive dyskinesia and Huntington's disease. We also have important projected study readouts coming. We anticipate reporting results from four phase II or phase III studies between now and the end of 2027, underscoring both the breadth of our pipeline and the momentum behind our R&D strategy. Our next major readout is expected to be ACP-204 in Alzheimer's disease psychosis in mid-2026. We're particularly excited about this opportunity and what success could mean for the future trajectory of our company. The unmet need here is substantial, the market opportunity is large, and we have built this program based on a substantial body of learning from pimavanserin at both the molecule and the trial level. Now, switching gears to our international expansion efforts.

First, I wanted to provide an update on the regulatory process in the EU for trofinetide. We've been informed by EMA that the earliest that a scientific advisory group could be held would be January. Given this, we now anticipate a CHMP opinion in the first quarter and the EC regulatory decision following the standard regulatory timeline. Meanwhile, in Japan, we've successfully initiated our phase III study, representing a key step towards potentially bringing trofinetide to patients in this important market. Now, before I close, I wanted to take a moment to acknowledge and thank everyone involved in our COMPASS Prader-Willi Syndrome study and the ACP-101 clinical development program. We are so grateful for the dedication and contributions of the patients, families, study site personnel, and physicians who participated.

While the outcome wasn't what we hoped for, we hope that learnings from the trial will benefit the Prader-Willi community, and we're actively sharing our insights while we work to add the findings to the scientific literature. Our pipeline continues to represent a powerful engine for future growth as we look to advance therapies for underserved neurological disorders and rare disease communities. We anticipate continued activity across our pipeline over the coming years, with multiple programs progressing through key stages of development. As a reminder, across our eight disclosed programs, we anticipate initiating five additional phase II or phase III studies between now and the end of 2026, demonstrating the depth and diversity of our development portfolio. And of course, we anticipate reporting four phase II or phase III study results in 2026 and 2027. And now, I'll pass over to Mark for a review of our financials.

Thank you, Liz. Let me walk you through our third quarter financial results. We delivered an excellent quarter that underscores the robustness of our commercial portfolio, which enables us to generate strong revenue and cash flows while continuing to invest strategically in growth opportunities. The third quarter was strong across the board, with $278.6 million in total revenues, up 11% year-over-year. DAYBUE achieved net sales of $101.1 million, up 11% year-over-year, all of which is attributable to volume growth. The gross net adjustment for DAYBUE in the quarter was 22%. NUPLAZID delivered net sales of $177.5 million, up 12% year-over-year, with 9% of that growth attributable to volume. The gross net adjustment for NUPLAZID was 25%. Turning to operating expenses, R&D expenses were $87.8 million in the third quarter. Up from $66.6 million. In the third quarter of 2024.

With the increase primarily attributable to higher clinical trial expenses from our ACP-204 LVDP and ACP-101 programs and personnel expenses, partially offset by lower clinical spend from programs that have completed. SG&A expenses for the third quarter were $133.4 million, essentially flat with the prior year. Turning to the balance sheet, we ended the quarter with $847 million in cash, compared with $762 million at the end of the second quarter. Looking ahead to our full year 2025 guidance, we're making targeted updates that reflect our strong performance and outlook. For NUPLAZID, we're raising the lower end of our guidance range and increasing at the high end to $685 million-$695 million, up from $665 million-$690 million, reflecting the momentum we're seeing in the business.

For DAYBUE, we're modifying to include contribution from our named patient supply programs and narrowing our prior guidance range, and now expect $385 million-$400 million, compared with prior guidance of $380 million-$405 million for US only. Regarding operating expenses, we now expect R&D expenses of $335 million-$345 million, compared with prior guidance of $330 million-$350 million. For SG&A expenses, we now expect $540 million-$555 million. Compared with prior guidance of $535 million-$565 million. Our financial strength positions us exceptionally well to finish 2025 strong while making the investments necessary to drive sustained growth in 2026 and beyond. I'll now turn the call back to Catherine for closing remarks.

Thank you, Mark. As we wrap up today's call, I wanted to emphasize our commitment to finishing 2025 hitting over $1 billion in total revenues, positioning ACADIA for continued growth in 2026 and beyond. We continue to be confident in the stability and growth trajectory driven by our new sales teams for DAYBUE, reflected by the over 1,000 patients globally who are now on treatment. We're focused on unlocking NUPLAZID's full potential with our strategic field force expansion and proven patient engagement campaigns. And we now have the elements in place to further accelerate that growth. We are dedicated to advancing our robust pipeline, as Liz has described, and look forward to the four major readouts expected in 2026 and 2027. We also continue to focus on expanding our portfolio through business development, with our strong balance sheet providing flexibility to pursue partnerships and acquisitions.

Ultimately, our mission drives everything we do to turn scientific promise into meaningful innovation that makes a difference for underserved neurological and rare disease communities around the world. We are here to be their difference. I'm excited about what lies ahead for ACADIA, and I'm confident that our strategic investments and unwavering focus on our patients will deliver value for all of our stakeholders. And with that, I'll turn the call back to the operator for questions.