Axsome Therapeutics, Inc H.C. Wainwright 28th Annual Global Investment Conference

Take it away. Great. Thanks very much for having us, and good morning, everyone.

Nice to be here and see you all. We're actually going to take you through today, and the corporate presentation instead of a fireside chat, we want to take a moment to really share how the business has grown and where it is in this very, I think, unique stage of development that we're pretty excited about. First and foremost, we will be making forward-looking statements today, or we may be, and we'd encourage you to read a full summary of the risks and uncertainties associated with our business through our filings at the Securities and Exchange Commission. With that, we'll get started. Axsome Therapeutics, we are focused on central nervous system disorders, in particular, highly differentiated mechanisms of actions for areas of unmet need or that have been underserved in CNS.

That's, we think about it for psychiatry and neurology. The snapshot of the business today is three marketed products, Auvelity, Sunosi, and SYMBRAVO. Auvelity's approved for major depressive disorder, and recently, Alzheimer's disease agitation, which we are launching now. Sunosi for excessive daytime sleepiness and OSA or narcolepsy, and then SYMBRAVO for migraine. We'll talk more about each of those. We have six differentiated product candidates in development across 10 different indications in psychiatry and neurology. We're very pleased with that and the state of the business. We have trials ongoing in smoking cessation, ADHD, binge eating disorder, major depressive disorder with symptoms of excessive daytime sleepiness or excessive sleepiness, and fibromyalgia, and shift work disorder. We have programs that are on deck or in the works for schizophrenia, epilepsy, and we are also looking at Tourette.

Then finally, we have an NDA under review with the FDA Division of Psychiatry for our AXS-12 product candidate in narcolepsy. Just the business has never been more robust commercially or in the R&D side. We'll take a quick moment to review recent business highlights. We reported Q2 last month, and Nick, I don't know if you want to cover- Sure a couple items on.

Thanks, Mark. So, Q2, we did $218.4 million, which was 46% year-over-year growth. That was really led by Auvelity, which recorded revenue of north of $180 million. Auvelity continues to grow. We recently did expand the team from less than 300 reps to north of 600, 630 if you include our long-term care team. And importantly, in the most recent quarter, we received a new indication for Alzheimer's disease agitation, which is a lot of the Street's focus currently, and obviously a lot of focus for us. So looking to continue to build the MDD brand and launch the ADA brand.

Great. And pipeline, I touched on some of the ongoing clinical trial work, but just to summarize. So seven ongoing trials. We have an NDA for AXS-12, which I touched on. PDUFA date is May 1st. Highly differentiated. Again, that starts with mechanistic differentiation that flows into a distinct efficacy and tolerability product profile, and we'll look forward to keeping everyone updated on the progress there. We recently initiated three phase III trials. That's smoking cessation for AXS-05, the SUMMIT trial, and then the two studies of solriamfetol in ADHD. That's in children and adolescents. That's the FOCUS-2 and FOCUS-3 trials. And as a reminder, we have a positive phase III trial in adults that completed, and multiple other programs behind those or complementing those. I touched on the PDUFA date for AXS-12.

We then have top line results that we anticipate for the ENGAGE Phase III trial of solriamfetol in binge eating disorder in the fourth quarter. We've also shared that we anticipate top line from the shift work disorder trial of sarampanadol next year.

Cool. Yeah, so a bit about in more detail on the numbers for Q2. As I mentioned, Auvelity led Axsome with $180 million. We've estimated that currently we expect peak sales potential to be $8 billion plus, and that's roughly split between MDD and ADA. One of the things to think about is where we are currently. We mentioned $180 million in Q2, and that was really the effect of, as I mentioned, less than 300 reps. We've now more than doubled down. We additionally have market access that is conducive to being first line or first switch in MDD as well as ADA, and access in the ADA channel being every participant in Medicare Part D has access to Auvelity with north of 85% not requiring a PA and also being unrestricted or first line. We feel really great about the $8 billion plus number.

One of the things to also maybe just taking a step back, we're less than four years in, we analyze based on Q2's numbers around three quarters of a billion, and that was only with 0.25. That's a quarter of 1% of the entire anti-depressant market with, as I mentioned, less than half the team that we currently have now. We feel like this is the new chapter for Axsome. I think the first chapter was really successful, but now we're going into more of an overdrive, doubling the team, having the market access, making patients aware through direct consumer advertising and expect to see accelerated growth in the coming years. Maybe just a minute on Sunosi too. Sunosi, $36 million in Q2 revenue, peak sales $300 million to $500 million.

SYMBRAVO doing $2.3 million, but did have a strong growth in Q2 versus Q1, 30% growth. The story there is just getting payer access. Anecdotally, we've heard nothing but positive feedback on SYMBRAVO, and the demand is showing that positive feedback, but it's just about getting payer access in this space, and we believe the peak sales there for a half a billion to $1 billion. Financial performance for the quarter. As you can see, the $218 million, 14% sequential growth, 46% year-over-year. Very robust growth year-over-year. Importantly, the OPEX of $46 million and $208 million for SG&A, we anticipate that that number has essentially plateaued, going into the back half of the year. That's meaningful as we are approaching cash flow positivity and then profitability shortly thereafter.

The SG&A number fully encompasses the expansion that I mentioned for the sales team for Auvelity. We do anticipate R&D to increase marginally from the $46 million number as we continue to develop the phase III assets that Mark mentioned earlier. The balance sheet's super strong, $320 million as of the end of Q2, strongest and healthiest position that we've been in since inception. We also put on here the shares outstanding, 52 million, which I think compared to some of our peers that are in that $10 billion to $12 billion market cap and where we are with the current commercial products as well as our pipeline products, we only have 52 million shares outstanding. We've been very sensitive to dilution. Even with the dilutive shares, you're at 60 million total share count or roughly 60 million, if you include the employee stock option plan.

The cumulative deficit for the company is $1.2 billion or $1.3 billion. That is from inception. That is from 2012. Again, a small fraction, just how we think financially about investments and how we deploy capital.

If we look at the commercial products, just to be mindful of time, we'll be somewhat abridged here, but Auvelity, obviously, this is what all eyes are focused on, and the feedback we receive from folks like yourselves. But oral NMDA receptor antagonist, this is the first and only oral NMDA receptor antagonist, and sigma-1 agonist for both major depressive disorder and Alzheimer's disease agitation. In MDD, it demonstrates a rapid onset of action, robust and durable efficacy, and a distinct safety and tolerability profile. That's the clinical program we saw. Now with four years on the market, that's the feedback we get from patients and prescribers, that the drug works really well. It's differentiated from an outcomes perspective or an overall profile perspective, and that we see when patients and prescribers try the product, it leads to very robust adoption. Nick touched on that. We've expanded the sales team.