Alkermes at Needham Conference: Orexin Agonists' Potential Unveiled

On Wednesday, 09 April 2025, Alkermes (NASDAQ: ALKS) took center stage at the 24th Annual Needham Virtual Healthcare Conference. The company shared insights into its orexin two receptor agonist class of drugs, emphasizing their potential in treating excessive daytime sleepiness. While highlighting the promising future of these drugs, Alkermes also acknowledged the challenges in translating volunteer data to patient populations.

Key Takeaways

• Alkermes' lead compound, ALKS 2680, shows promise in treating narcolepsy and idiopathic hypersomnia (IH).
• Orexin agonists could potentially transform the treatment landscape, offering improved efficacy and tolerability.
• Alkermes plans to expand its program by introducing two additional molecules into clinical trials this year.
• The company is building a factory and scaling up its API in anticipation of commercialization.
• The prevalence of narcolepsy in the U.S. is estimated at 200,000 patients, with only 100,000 diagnosed.

Operational Updates

• Alkermes is conducting a Phase 2 study involving 80 patients each for narcolepsy type 2 (NT2) and IH to assess the clinical efficacy of ALKS 2680.
• Preparations for commercialization include constructing a factory and enhancing the supply chain.
• Two additional molecules are set to enter clinical trials, indicating Alkermes' commitment to expanding its orexin agonist program.

Future Outlook

• Orexin agonists are expected to revolutionize treatment for narcolepsy and IH, potentially allowing for monotherapy regimens.
• Alkermes anticipates the pharmacology of these drugs to extend beyond excessive daytime sleepiness, impacting nighttime sleep and cognitive functions.
• Increased awareness and education among primary care providers are projected to boost diagnosis and treatment rates for narcolepsy.

Q&A Highlights

• There is significant interest from clinicians and patients in orexin agonists.
• It is anticipated that 55-60% of NT1, 35-40% of NT2, and 50-60% of IH patients may eventually use orexin agonists.
• Flexibility in dosing is crucial due to potential side effects at higher doses.

Readers are invited to refer to the full transcript for a detailed account of the conference call.

Full transcript - 24th Annual Needham Virtual Healthcare Conference:

Ami Fadia, Biotech Analyst, Needham: Good morning, everyone. I'm Ami Fadia, biotech analyst here at Needham. I'm really excited to be hosting this panel discussion today on the orexin two receptor agonist class because I believe it's gonna be a significant advancement in, treating excessive daytime sleepiness. And it's my pleasure to be hosting Richard Pops, who's the chairman and CEO of Alchemys, as well as doctor John Carter, who is a sleep medicine specialist and the medical director of Mental Health Center in Cleveland. Welcome both to the panel.

Thank you so much for taking the time to do this today. Thanks for having us. Thanks. So let me just, you know, kick us off with, sort of a question, a fundamental question just around kind of the mechanism. And maybe, Rich, you can start us off here.

The the mechanism the mechanistic rationale, for this class is certainly well established in NT one, given the loss of orexin neurons in these patients. And perhaps to some extent, it is there even in n t two, because of the partial loss of orexins, but the etiology is less known in NIH. And yet, you know, we have seen data from Alkermes, which has demonstrated clinical benefit across all three types of patients. So, perhaps if you could sort of elaborate on what do you believe is driving that efficacy.

Richard Pops, Chairman and CEO, Alkermes: Well, first of all, it's great to be with you, Doctor. Carter, and with with Ami. It's interesting. This biology is relatively new. I mean, the first papers were 1999, '2 thousand, elaborating the hypocreinorexin pathway and its effect on on weight.

And nature has provided us the knockout model, which is orexin I mean, anarchomology type one, which is a deficiency of this bundle of neurons. So as you say, if you do concentric circles of the potential utilization of an orexin two receptor agonist, the core of it is it would be an n t one where we have a possibly or an absence of of of a neuropeptide. We and others have shown by replacing that neuropeptide with a small molecule agonist, you can essentially replicate what the neuropeptide does and and and significantly address the excessive daytime sleepiness associated with it. One would hypothesize then that it might also work in in n g two, IH, and even in in healthy brain, non orexin deficient brain, based on a couple of things. Number one is what you said, the empirical

We actually have data from one b study showing a dose dependent fashion. We can improve wakefulness in this patient population. That's probably the most powerful information. But remember, even in early in our in our development, looking at healthy volunteers, non sleep deprived, we saw changes in quantitative EEG measures consistent with the idea of of wakefulness and and vigilance and attention. So I think all of that adds together, and I think that the proof point will be what we're doing right now, which is a proper phase two study, 80 patients in n t two, 80 patients in NIH, a range of doses over a multi week outpatient setting, then we all can sit down and look at those data and say, okay.

What what's the real phenomenon that we're that we're that we're realizing with with the use of these drugs?

Ami Fadia, Biotech Analyst, Needham: Mhmm. Yeah. That makes sense. Doctor Carr, anything you'd like to add? Any open questions from your perspective?

John Carter, Sleep Medicine Specialist and Medical Director, Mental Health Center in Cleveland: Well, I I think you've you've hit upon a a key question sort of driving at the underlying physiology and and mechanism here, and it's certainly one that on the clinical end we share. I tend to agree with Richard that there is growing evidence for the role of orexin agonists even outside of the quintessential case which is narcolepsy type In my mind wakefulness is a spectrum. It's not an onoff switch. It may be a matter of replacing lost function in NT1, but outside of that whether it's NT2, IH, or even other conditions, you can still turn up the volume on alertness through orexin neurobiology. And I suspect in large part that's the mechanism that is being tapped into.

Ami Fadia, Biotech Analyst, Needham: Okay. So I wanted to talk about what this class, you know, can offer to patients. And so perhaps just for context, doctor Carter

Richard Pops, Chairman and CEO, Alkermes: I hate to interrupt, but I'm going

Ami Fadia, Biotech Analyst, Needham: to interrupt.

Richard Pops, Chairman and CEO, Alkermes: I think what doctor Carter just said is so important. We and I think for many people new to the field, we tend to focus on the quantitative measure of wakefulness as evidenced in the maintenance of wakefulness test that we're using in the m t one study, I e, how many minutes one stays awake in a dark, quiet, quiet room. That is a measure of something, but it's not a measure of the overall phenomenon of being awake and conscious. And and so our our our belief is is the retina system does more than keep you awake in a dark room. What it it it it impacts domains associated with mood, vigilance, attention, all these other things.

And and what's so exciting about this being a new field of research is that I'm highly convinced that ten years from now, we'll look back and have a much more nuanced multidimensional understanding of what this circuitry does in the brain.

Ami Fadia, Biotech Analyst, Needham: Yeah. No. I think that's a great point. Okay. I wanted to just sort of, put in context what this class can offer in terms of efficacy.

And so maybe just, if I could ask doctor Carter to to sort of characterize what current therapies offer in terms of efficacy benefit.

John Carter, Sleep Medicine Specialist and Medical Director, Mental Health Center in Cleveland: Well, the overarching message to deliver about narcolepsy and other hypersomnia therapies is that there is very significant unmet need. Although many people with narcolepsy and other hypersomnias experience significant improvement with other therapies, many of them require multiple prescription drugs in order to do that, and there are still significant gaps, particularly in NT1 and IH but also in narcolepsy type two. And again, to kind of echo Richard's point, we certainly have drugs that can target alertness, stimulants and things of that nature. But we are very much in the infancy of understanding the full spectrum of what the real need is in narcolepsy. And a phrase that I've heard from a couple of my patients now has really stuck with me is that, you know, these drugs help me feel stimulated but not awake.

And that is a relatively common experience in this patient population. So, you know, we do have a number of therapies including the old school stimulants which have some benefit, somewhat newer wakefulness promoting agents, and newer medications that work through a variety of mechanisms such as the oxybates, pitolisant, solriamfetol, etc. So the paradigm currently with narcolepsy is very much one of polypharmacy. Not for every patient, but for many patients. It's one of polypharmacy and significant unmet need.

Ami Fadia, Biotech Analyst, Needham: Yeah. So, Richard, as you've been developing this class, how you know, what what is sort of the end goal in terms of the target product profile, at least for kind of your lead compound here in terms of what you're looking to achieve in terms of efficacy?

Richard Pops, Chairman and CEO, Alkermes: I think drug development is about trying to harness efficacy within the context of a tolerability profile that's accepted patient from a risk benefit perspective. All medicines have side effects, and so a lot of the work we do in phase two is to try to tune and find that dose that is the right balance between safety and efficacy. Categorically, you'd say that this category so far has shown remarkable tolerability. The side effects that we and others have demonstrated so far that are on target tend to be mild to moderate and transient and actually attenuate with time in in the one eight week study that we have data from. So the target product profile is to deliver best in class, in fact, new domains of wakefulness from the from the existing medications.

And I think doctor Carter can comment on that. I mean, we know what oxybates. We know what stimulus will do in the MWT, for example, which can take single digit latencies and make them, you know, low double digit latencies, whereas the orexins have shown the ability to, at doses max out the the forty minute test for many, many hours. It's it's it's not shades of the same color. It's a profound different level of of of wakefulness.

And as one of our thought leaders said, you know, if we we if we drew drove this much wakefulness in the MWT with stimulants, the patients would be psychotic. So it's a it's a really different opportunity for patients to to achieve levels of wake cure to four unachievable. And if we can do that with a with a side effect profile that's that's mild to moderate, transient, and and doesn't lead to discontinuations, I think we've made a big advancement for patients.

Ami Fadia, Biotech Analyst, Needham: Mhmm. Yeah. And, you know, as we think about sort of the data that's been generated and and, you know, sort of going back to that mechanistic rationale and taking kind of these studies that are small in size to help you identify the right dose and the proof of concept and and thinking about kind of the larger studies, which will be more sort of registrational. Particularly, you know, I think investors, wanna better understand how to think about n d two and IH as indications where, you know, do you think we can replicate we can see replication of the profile, that was seen particularly for, you know, ALKS twenty six eighty, in kind of that larger eight week treatment duration?

Richard Pops, Chairman and CEO, Alkermes: Yeah. We don't see any reason a priori why you would expect tachyphylaxis or any phenomenon different than we saw in one b, but that's why you do an experiment. That that's that's exactly how science works. So we have we have data from a from a crossover design where where we tested multiple doses in in one dose in a in an intense inpatient setting to really understand target engagement, dose response to in order to inform phase two. So then in phase two, we enroll 80 patients.

And what's interesting, if you sort of drew a histogram of the clinical presentation of an NT1 patient, it's a more monodispersed figure. N t two and IH, it's much broader. Phenotype is much more so variability is gonna be a big issue. If you saw the the presentation we gave at our Investor Day, for example, we talked a lot about how we model and incorporate variability to our modeling for dosing decisions. And what what informs that model, what populates the model, is actually data from patients.

So in the in the 80 patients that we're gonna get now, we'll have a whole range of of of clinical presentations, and we'll be able to map on the responses and and and do more modeling to decide what do we do in phase three. Operationally, the phase three looks just like the phase two. I mean, it's just it it you're we're not really powering these things so much for efficacy in t one. The effect size is so large. It's really to establish that tolerability dose profile that we can take into later studies.

Ami Fadia, Biotech Analyst, Needham: Mhmm. Yes. I think doctor Carter earlier talked about the polypharmacy sort of is the is the way that patient are being treated today. Where do we want to get these patients to ideally, whether it's with one or multiple drugs? So maybe, doctor Carter, from your perspective, what is sort of the gold standard or what is the target as to where you want your patients to get to with appropriate treatment?

John Carter, Sleep Medicine Specialist and Medical Director, Mental Health Center in Cleveland: Well, with the caveat that that the MWT is a very sort of monodimensional measurement, The absolute maximum would be forty four zero minutes. And generally, a latency above twenty minutes is considered to be the normal range, so between twenty and forty. My general conception of what I would shoot for in terms of an ideal result would be somewhere in the twenty five to thirty five minute range. Every patient is different obviously, but I mean to use a very simple example, if you have a thirty minute commute and your mean sleep latency is twenty five minutes, that's a failure for you. Okay.

So we may not be trying to max out the the MWT, but but certainly more is is better in the vast majority of of cases.

Ami Fadia, Biotech Analyst, Needham: Uh-huh. And, you know, as we sort of think about what is ideal and, you know, is is sort of, you think about multiple treatment options down the line, and there probably will be several, is more always better for everybody, or do you just need to bring them to the normalized range of, you know, over 20 or 25?

John Carter, Sleep Medicine Specialist and Medical Director, Mental Health Center in Cleveland: I I think it's a very, very important question. So so as a general rule, more more is better. But as we start to hit the 40 sort of let's say thirty five to forty minute zone, that allows us the freedom to start looking at important other variable secondary outcome measures. You know, we are going to I'm very confident we are going to reach a point very soon with the orexin agonist class where every molecule coming to market is easily able to achieve these very robust results with MWT. And the differentiation then comes in A, tolerability profile, B, dosing regimen which does matter to patients once daily, twice daily, etcetera.

And c, what other benefits does it afford? What does it do for cognition and memory and mood? All of which are wrapped up in attention and alertness, but but not really captured in in the MWT. So those those I think are critically important things to to to look at. To to To answer your question very simply, you know, am I inherently worried about a patient with a forty minute sleep latency on the MWT?

No, I'm not. Unless that forty minute latency is also accompanied by very significant insomnia. That's that's the balance, I think, that needs to be struck.

Richard Pops, Chairman and CEO, Alkermes: Amit, can I add two points to what doctor Carter just said? Number one is that our view is that we wanna test that empirically. In our phase two study, for example, there's a six week double blind period where people stay in their dose lane that they've been randomized to. At the completion of the six week period then, all patients in open label fashion go to the middle dose of the three doses for two weeks, and then they get to choose whether they go up or down. And this will be really interesting to see whether some people want more wakefulness or less wakefulness.

Is there too much? Is it too little? And that that real world experience is is gonna be important, a. B, as we move from n t one into n t two in IH, given the range of clinical presentations, it stands to reason for us that there might be a range of doses to get that are necessary. So a patient with an n t two presentation looks more like an n t one patient might need a different dose.

It might be more responsive to a orexin agonist than the one that has a thirty minute latency. We'll learn this also empirically in in in the conduct of of phase two clinical trials.

Ami Fadia, Biotech Analyst, Needham: Maybe maybe a related question for doctor Kaur. Do you think that there's value in that type of flexibility as you think about treating patients down the line? There certainly seems to be a lot of heterogeneity, especially in n t two n I a, just which pointed out. So I I would imagine that you would want that type of flexibility.

John Carter, Sleep Medicine Specialist and Medical Director, Mental Health Center in Cleveland: I absolutely agree with that. So, yeah, I mean, in addition to the variability that we see sort of across the cohorts of NT1 versus NT2 and NIH with NT1 being in general much more homogenous, NT2 and NIH in general being much more heterogeneous. There's also significant inter individual variability. You know, not everyone is experiencing the same side effects, the same symptoms, not everyone needs the same dosing regimen strength, etc. Very, very simple example.

I mean we see essentially no agreement among our patients with narcolepsy regarding whether once or twice daily dosing is better. Some people prefer the flexibility of twice daily dosing. Other people understandably prefer the ease and simplicity of once daily dosing. And at least in my practice it's an even split right down the middle. So to your point, having flexibility and options both in dosing and and and also the the timing regime is really, really critical to treating patients in the real world.

Richard Pops, Chairman and CEO, Alkermes: Mhmm. Our view on that, Ami, on the once versus twice daily data, again, goes back to the data. The the the theory, when you need twice daily dosing, two things happening. It implies that there's a tail, a backside of the efficacy that needs to be bolstered again. And so that means there's a period of time where you're not achieving everything you want from the drug perhaps.

Also, you're subjected to two peaks, two Cmax peaks. So so to the extent that there are AEs associated with either rate of change or absolute peaks, that would be duplicated on a daily basis. Again, those will come through the data, and and that's theory until until we do the experiment.

Ami Fadia, Biotech Analyst, Needham: Also, isn't there some type of, you know, lack of compliance from patients with regards to exactly what time in the day they take that second dose? Is that something, you know, to be worried about?

John Carter, Sleep Medicine Specialist and Medical Director, Mental Health Center in Cleveland: It's a real phenomenon. I would say the negative side of that is missed doses and mistimed doses. If you take it too late it results in insomnia, that kind of a thing. On the other hand it is sometimes the case that patients prefer the flexibility of taking the second dose. Again, if you're limited to one dose during the day and it works well for you, great.

If it's wearing off too early, you're out of luck. So I certainly agree with Richard's comments about the AEs inherent in dual peaks and so on, and that point is well taken. I will say the feedback we hear from the narcolepsy patient community really does sort of split down the middle. There's very clearly a convenience argument to be made for once daily, possibly a side effect as well. Though some patients do feel fairly strongly that they want the control and flexibility of more frequent dosing.

Not many, it's a minority, but it's a sizable minority.

Richard Pops, Chairman and CEO, Alkermes: Doctor. Carter, it's right. We're also doing the experiment probably with the oxybates. Right? You would think that perhaps once a night oxybate is better, but people some people prefer twice a night oxybate.

John Carter, Sleep Medicine Specialist and Medical Director, Mental Health Center in Cleveland: Exactly.

Ami Fadia, Biotech Analyst, Needham: Yeah. Exactly. We've seen a real world, example of that. Okay. Great.

So I kinda wanna just step back and and maybe ask a question that maybe, you know, both of you can answer. But, you know, doctor Karra, as a physician, you know, based on the data that we know, and then, you know, I wanna dwell a little bit more on efficacy on on the safety comparisons, a little bit later. But just purely on efficacy, do you think that there's a discernible difference across at least the three leading three companies that are leading in the space, you know, Takeda, Alchemist, and Sentessa. Do we know enough about the data? Of course, we have different levels of data from all three.

So acknowledging that, how how are you going to think about differentiation across the three?

John Carter, Sleep Medicine Specialist and Medical Director, Mental Health Center in Cleveland: So focusing only on on efficacy and taking into account all the caveats that that you mentioned, my impression is that there is a signal towards more robust efficacy in the ALKS two thousand six hundred eighty product and possibly in Sentessa's product with the caveat that, again, we're only basing that on healthy sleep deprived volunteers. A couple reasons I say that. One, yes, there might be small differences in the absolute value on the MWT, but also the condition in which the medication is being applied in study matters a lot. Know, as we open the conversation with, I think we've all expected for fifteen years, twenty years that narcolepsy type one is going to respond very well to orexin agonists. And it's a much more recent development and a pleasant surprise that that is also true outside of the orexin deficient states.

However, it seems to be the case that higher doses expectedly are going to be required in NT2, NIH, in other words outside of the orexin deficient states. And the big question, you know, for me with the data is are we still able to achieve meaningful and robust clinical efficacy in those non orexin deficient states? And again acknowledging all the caveats and limitations of the data, the answer to that seems to be yes, with stronger signal for the Alkermes and Sentessa products in my

Ami Fadia, Biotech Analyst, Needham: opinion. Okay. Maybe, Richard, would you like to sort of comment on that? And, you know, I I think the one thing is, we we do have different levels of data, right, from from the different companies. And maybe one thing I would like to better understand is how do we look at the healthy volunteer data, from, you know, any any any of these drugs and think about translating that.

So perhaps maybe, Richard, if you could talk to at least, you know, how you guys thought about your development program in that regard. And, doctor Carter, how do you sort of view that data?

Richard Pops, Chairman and CEO, Alkermes: Yeah. I'll give I'll give you our perspective on the the relative state of the maturation of the data. Takeda has the most mature data because they have eight week data in the outpatient setting at an efficacious dose to interrogate safety and efficacy and tolerability. We have patient data of of a significant cohort in n t one, n t two, and I that's showing consistent dose dependent responses on on the measures that we've been testing. We're the only ones who have patient data, and what we found is that is that in our in our work, that we couldn't recapitulate the sleep pressure that you would find in a narcolepsy patient in a sleep deprived healthy volunteer, particularly if you only keep them up until eleven or twelve at night.

It's just it's a it's a it's a setting for testing target engagement perhaps, but our sense was you need to be in the patient population of interest to get a sense of dose and tolerability at that dose. And we expect, actually, a shifting dose response curve as you move from n t one to n t two to healthy volunteers, both in terms of of efficacy as well as tolerability. So the setting to establish dosimetry and tolerability and efficacy for us is in that patient population. And so, I think that that that's that's not saying who's better than that. It's just an acknowledgment of of the state of development of each of the various programs.

Ami Fadia, Biotech Analyst, Needham: Yeah. And maybe, Doctor. Thara, could could you sort of just comment on kind of how you see that? And then also, you know, we earlier talked about just bringing patients to a kind of a normalized level, and you acknowledge that, yes, you you take 40 if if if you, you know, have that. But then, you know, as we evaluate multiple products, you know, as and as investors that cover these companies, how many points of difference in in in in in really matters?

Is it just about bringing somebody to a normalized level? And if we see, I don't know, 32 versus 35, is that meaningful, difference? So maybe if you could comment on that.

John Carter, Sleep Medicine Specialist and Medical Director, Mental Health Center in Cleveland: Sure. So so two parts to that question. The the first part I think was sort of around how do you how do you interpret or translate healthy volunteer data into the into the patient population. And and I, I think certainly healthy volunteers are going to need a higher dose compared to somebody with NT1 and probably NT2, Assuming that there's a dose response between dose and efficacy and also dose and adverse events, I think you're probably looking at something like an NT2 NIH profile in the healthy volunteer data. That's very rough sort of rule of thumb type assumption.

In other words, the doses that normalized wakefulness in the sleep deprived healthy volunteers are likely above the doses that will be required for efficacy in NT1. That's sort of my view on things. But that again acknowledges very significant differences in the underlying physiology. We're not just dealing with sleep deprived people. We have a dysfunctional, very broad cortical network that's tied up in orexin deficiency.

So I have to add that caveat in there. To answer the second part of the question, you know, what is a meaningful change on the MWT? And there is, I would say, more art than science here. But, you know, my general view is that a chain certainly bringing someone from abnormal into the normal range is is clinically meaningful. And if someone is near the the normal range, generally, I consider a a ten to fifteen minute increase from baseline to be clinically significant and and meaningful.

And again, the the data we have across this asset class seem to back that up. I guess I would also point out, although we could all look at these sort of the maximum dose studied in each of these trials and the MWT result associated with that, in clinical practice it's going to be very useful for me to have dosing options. I want a low dose, a medium dose, and a high dose because not everybody needs the high dose, not everybody wants the high dose, and we want the ability to tailor the degree of clinical response and the duration of clinical response to what the patient actually needs. So for me, yes, I love to see those high bars above twenty five to thirty five minutes, but it's also very important to see that dose response in a linear fashion.

Ami Fadia, Biotech Analyst, Needham: Yep. Okay. That makes a lot of sense. Just beyond m MWT, which we've sort of talked about quite a bit, what are some of the other endpoints that are worth studying or which, you know, you guys are sort of thinking about evaluating. And, you know, is there gonna be a a difference in the rate of response across these treatments?

What is the rate of response currently to, you know, as twenty six eighty? I'm I I don't know if that data is out there. I'm just curious how that will come into the mix of things.

Richard Pops, Chairman and CEO, Alkermes: I think in t one, the the the coin of the realm would be MWT, Epworth, and cataplexy rates. And those are all three being tested in in trial. In NT two, we use we use the MWT in Epworth. And in IH, we don't use MWT. We use we use the idiopathic hypersomnia scale in Epworth.

I'm I'm I'm particularly interested in Epworth. I'm curious what doctor Carter says about it because unlike the the MWT, which has the virtue of being an objective measurement that you can do math around, Epworth tells patients tell physicians how they feel. And even though it's a blunt instrument, it's an important instrument because we could probably keep you up for a long time in the MWT study in a condition you wouldn't enjoy being in. The upworth captures then the feeling of of being on the medicine. And so I think that that in phase three, I mean, we'll use all three of those measures, but what we're doing in phase two is we're interrogating a whole range of patient reported outcomes to try to see where where we detect signal.

And if if it turns out to be an instrument that we and and physicians like doctor Carter think are relevant, we wanna incorporate that into our phase three program as well.

John Carter, Sleep Medicine Specialist and Medical Director, Mental Health Center in Cleveland: I certainly agree with that that sentiment. I mean, the the value of combining MWT and the Upward Sleepiness Scale is that we're getting multiple lines of information, one of which is subjective with some bias obviously, the other of which is objective. The other thing of course is that in clinical practice you know, we don't have readily available MWTs to do on command. We rely on instruments that we can deploy in the clinic in a couple of minutes or even remotely. And there are a number of subjectively rated sleepiness screening instruments, the Stanford Sleepiness Scale, Karolinska Scale, etcetera, etcetera, the Upworth obviously.

I think all of which captures something important and subjective and meaningful to the patient. I would just follow that on with one other sort of comment. Totally agree. You know, at this stage of where we're at with orexin agonists coming down the pipeline, MWT, upworth cataplexy rate, etcetera, are all the key primary measures to to look at. Things that I'm excited about seeing response rates for have to do with those sort of ancillary measures of alertness and and attention.

Psychomotor vigilance, memory, mood, etcetera. And particularly, you know, looking down the road three, five years when we have three, four or more orexin agonists sort of playing in the sandbox, all of which are maxing out objective measures of sleepiness, all of which are reasonably well tolerated at the most common doses. The things that I'm going to be looking at in terms of, you know, which one do I prescribe to this patient versus this patient is, you know, what else can I get you? What other benefits can I offer in terms of your daytime function? It's a bit of an open question, at least in my mind, about whether those sorts of things are class effects.

In other words, will all orexin agonists improve the attention network because that's just what they do? Or will we see molecule specific differences among those? And not to hedge too much, but I suspect it's a little column a, a little column b, right? Certainly we will see some class specific improvements across those measures, but I would be very interested to see molecule specific differentiating factors in those secondary outcome measures, you know, over the next several years.

Richard Pops, Chairman and CEO, Alkermes: Let me build on that, Hamid, because it's a critical point. So there's think about it. There's two dimensions to that. One, are there intrinsic molecular differences that drive different behavioral responses or or cognitive responses? Or and you have to test them.

So the the companies that actually do the work, spend the money, invest in the research will have that dataset to be able to share with clinicians and patients. And if you don't do it, I don't think you can just ride on the coattails of of people that preceded you. So I think there's a real virtue to being early and and pioneering in in articulating and and identifying some of these differences.

Ami Fadia, Biotech Analyst, Needham: Yeah. Okay. I wanted to sort of hone in on the safety profile, of this class, a little bit, and and I think previously, doctor Carter talked about, some of the limitations of the current treatment options in terms of just their tolerability. So perhaps without dwelling upon that, maybe let me ask, Rich, you know, some AEs of interest have certainly come up with this class, you know, insomnia, polychorea, visual disturbances, urinary urgency, so on and so forth. As a drug developer, you know, as you've thought about kind of balancing that risk benefit profile, what do you view as what would be acceptable in terms of the doses that you've picked across the three indications?

Richard Pops, Chairman and CEO, Alkermes: I think the profile remains the way it looks like it it it is as established in the in the Takeda eight week study and what we've seen early in our in our phase one b study, I think that'd be a very attractive profile. As I said, mild to moderate transient phenomena. The on target phenomena we know that that we can say reliably now would be insomnia, which tends to attenuate over time, and polycurea, this this urinary urgency, also, which tends to, based on these Takeda data, attenuate over time. And what was notable from from our perspective, and we really give a lot of credit to Takeda for being so forthcoming with presentation of their data, is that we saw really no patient discontinuations, based on those adverse events, and also in the patient reported outcomes, a very, very high level of satisfaction with the treatment. So to the extent that these these mild, moderate side effects are manifesting themselves, they seem to be overwhelmed by the quality efficacy that patients are getting.

Ami Fadia, Biotech Analyst, Needham: Yeah. Doctor. Carter, you mentioned earlier in our discussion that, you know, it seems that many of these drugs will bring patients to that normalized level of NWT. And perhaps there is going to be some potential for differentiation on, you know, other aspects of efficacy that you just pointed out, but also safety. What do we are we seeing a difference in safety across the different products at this stage?

John Carter, Sleep Medicine Specialist and Medical Director, Mental Health Center in Cleveland: My interpretation of the available data is that there's not major signal in terms of differential AE rates with one important caveat that with the higher doses used in NT2 and IH, again, we could reasonably expect a higher adverse event rate. Doesn't really seem to be spiking, so there is possibly a ceiling there. You know, with the data we have from Takeda, that's obviously moving forward only in NT1. They're limiting the dose as a result of that. So with that caveat in mind, I tend to conceive of all three of these products, Takeda's Alkermes and Sentessa's product, is generally in the same ballpark in terms of adverse events.

And I would agree that what we've seen reported looks to be on target. There's some important granularity that I would like to to see particularly around visual disturbances, which I suspect is probably just to do with, you know, the pupillary light response as opposed to something more concerning like visual hallucinations. Although, again, granularity is important there. And my sense from the data is that we are at a point, as Richard brought up earlier, where the sort of needle has been threaded between a high level of clinical efficacy and also a favorable tolerability profile, you know, the sort of safety signals that emerged with some earlier Takeda products, September, etcetera, I think are sorted out at this point. And so I do think things like the duration of side effects and obviously their severity may be an important differentiating factor for patients and for prescribers like myself, especially in those groups that are likely to require the higher doses, again, n t two and IH.

Richard Pops, Chairman and CEO, Alkermes: This is from our perspective. I think this is also where if you stipulate that there's a certain on target inherent set of AEs that might derive from orexin two receptor agonism, the space between various molecules could be defined by potency and PK. And so that that, again, we'll learn in the clinic.

Ami Fadia, Biotech Analyst, Needham: Yeah. I

John Carter, Sleep Medicine Specialist and Medical Director, Mental Health Center in Cleveland: suppose one one additional follow on point is that, obviously, everybody is very happy when the profile is minimized. But looking at the selection of available medications that we have to us presently, we are very used to significant side effects, particularly with the stimulants and particularly with the oxybates. I mean, are reasonably effective medications, but again, with significant adverse events attendant to them and potentially even some safety issues. I mean, oxybates be deadly in overdose. So big picture, at least for my reading of the data, I mean not only do the orexin agonists appear to have an acceptable AE profile, but I would say it's even favorable compared to what we have presently available.

Ami Fadia, Biotech Analyst, Needham: Right. So so the mild to moderate AEs that occur in the initial period of the treatment is still a welcome improvement over what the patients have currently.

John Carter, Sleep Medicine Specialist and Medical Director, Mental Health Center in Cleveland: That's right.

Ami Fadia, Biotech Analyst, Needham: Okay. Perfect. So wanna move on to, market dynamics. Obviously, you know, the number of patients across these three indications that that that suffer is is is large, and a lot of them get treated with antidepressants, stimulants, etcetera, and maybe a smaller portion are being treated with the oxoate class or, Wagex and and Sunosi as as you mentioned. How do you see this new class impacting, you know, the the percent of patients that get treated with this new class, and is that going to vary across indie one versus two NIH?

Doctor. Carter, you can go with that, and Rich, if you wanna chime in.

John Carter, Sleep Medicine Specialist and Medical Director, Mental Health Center in Cleveland: Sure. Well, at at the risk of sounding hyperbolic, my impression of the orexin agonist is that they will be quite literally transformative of the treatment landscape. So certainly not one hundred percent of patients will be ultimately on these medications, but I'll give you an anecdote. So I mean narcolepsy patients as a rule tend to be highly engaged. There's very strong community advocacy, very strong interest in what's going on in the research world.

And we as clinicians not uncommonly hear about new pipeline therapies from our patients. And so I can tell you certainly the buzz among the patient population for orexin agonist is strong and has been for quite some time. So I'm certainly discussing orexin agonist with one hundred percent of my patients with narcolepsy and a large fraction of my patients with IH. So reading the tea leaves a little bit, I think another important dynamic which we touched on earlier is for some patients I anticipate that we'll see a transformation from a polypharmacy regime to a monotherapy regime. And that's advantageous for lots and lots of reasons.

Fewer side effects, better tolerability, better safety, lower costs, better convenience. It's really sort of better across the board and there's strong patient interest in that. If we wanted to get sort of quantitative, you know, when I've looked at my own practice at sort of a mature steady state, it wouldn't surprise me if a majority, fifty five, sixty percent of my patients with NT1 ended up on an orexin agonist of one sort or another. That's going to take some time obviously, but I think that's steady state. I'd anticipate that would be a bit lower in NT2, maybe thirty five percent, forty percent simply because of the higher required doses and the somewhat lower unmet need in NT2 compared to NT1.

But interestingly, I might anticipate fifty to sixty percent of my IH patients ending up on an orexin agonist. And the reason for that has everything to do with the unmet need. These are patients who again in general tend to require lots and lots of medications and very high doses of them. Doses of stimulants that make me nervous to be quite frank. And any opportunity to reduce the doses of other therapies, to condense modes of therapy from polypharmacy to monotherapy is a big win in NIH.

So again, at the risk of sounding hyperbolic, I I anticipate pretty significant uptake in my patient population.

Ami Fadia, Biotech Analyst, Needham: Richard, anything to add? I I do have a follow-up for doctor Carlo.

Richard Pops, Chairman and CEO, Alkermes: I I quickly, I do. And, you know, we do extensive market research, but we do it by talking to experts like doctor Carter. So everything he said is consistent with what we're hearing in the population. The additional that I'll make, I'm curious for Doctor. Carter's response to this, is that the actual prevalence of narcolepsy is on the order of two hundred thousand patients in The U.

S, One Hundred Thousand of which are diagnosed and eighty thousand of which are treated. And our thesis is the disparity between the prevalence and treatment is because of a lack of awareness of primary care. I mean, we're talking to Doctor. Carter, a prominent sleep specialist. That's a rarity in the community.

As safe and effective medic medications become available and we and we start investing in disease awareness and teaching at the primary care level, I can see that that number converging. And because there's we hear about patient journeys. It can take ten years before people finally get the definitive diagnosis. And if we can shrink that down for patients, we could help a lot of people.

John Carter, Sleep Medicine Specialist and Medical Director, Mental Health Center in Cleveland: Unfortunately, I'm forced to agree. That's all very true. And I would just add briefly, mean, even within the sleep medicine community, we see barriers not so much to diagnosis but to treatment among sleep physicians simply because some of these medications are quite onerous to prescribe and monitor. They have real safety concerns. They're all controlled substances with one or two exceptions which have their own sort of complications associated with them.

So anytime we simplify the regimen, and we've seen this in other sleep disorders, sleep apnea, etc, but as a rule, I mean anytime you simplify the regimen, you open it up to more people, and that does drive up appropriate diagnosis rate.

Ami Fadia, Biotech Analyst, Needham: Before I ask you a question about polypharmacy, just with regards to the thirty five, forty percent you mentioned for n t two, While they are higher doses, if they're still within that similar safety profile as what gets offered to n t one, wouldn't more patients that are n d two patients wanna try it, or do you think they're just not as sleepy and and they just don't have as much of an unmet need?

John Carter, Sleep Medicine Specialist and Medical Director, Mental Health Center in Cleveland: It's it's the latter. So, you know obviously every case is different but there are more patients with NT2 compared to NT1 who are actually getting through life just fine on a single agent. Sometimes the devil's in the details and we found if you really start drilling down and asking about well how do you function in this scenario, this scenario, this scenario, that the unmet need appears greater than it did initially. So there is some work on the clinical end to uncovering the true need. But in general, many patients with NT2 are less sleepy, less severely sleepy compared to their compatriots with NT1.

Ami Fadia, Biotech Analyst, Needham: Mhmm. And and just with regards to the potential to eliminate polypharmacy, I guess if a patient is able to get back to a normalized state, wouldn't, you know, sort of basically half the patient population across the board, roughly speaking, just no longer need a second treatment? Is it as simple as that? And and, you know, the question that is top of mind for a lot of people who sort of think about the oxybate market is is this gonna be a huge impact to, you know, oxybates and other drugs like Wakix and Sunosi?

John Carter, Sleep Medicine Specialist and Medical Director, Mental Health Center in Cleveland: Well, you you bring up an important point, and and I think that the crux of of that answer depends on what else are we targeting in terms of our treatment, what other symptoms are patients experiencing. If we're treating only MWT, then that argument is absolutely correct. But the reality is, you know, as we've been discussing, the symptom profile is really multifaceted. Regarding the oxybates in particular, I mean my sense is that many patients with narcolepsy and IH will be excited to transition from an oxybate to an orexin agonist, but not all. And one of the big unanswered questions in my book is to what extent, if at all, will orexin agonists benefit nighttime sleep?

There's some reason to believe that they won't. Takeda has given us some very limited data in abstract form a few months ago. And mechanistically, you know, orexin levels fall to very low levels at night in normal physiology. So one could make a convincing argument that boosting orexin or agonizing orexin during the day is not likely to have much impact on nighttime sleep. But to echo one of Richard's earlier points, we don't know unless we know.

We don't know unless it's studied. And so I am very, very interested to see more data on what actually is the impact on overnight sleep with orexin agonists. If the answer continues to be minimal, then medications like the oxybates will probably continue to have a role. This is off label currently. We all know they benefit nighttime sleep quality though they can't be marketed for that.

Though we may see manufacturers seeking a label for that indication. On the other hand, if orexin agonists do have a real benefit on overnight sleep quality, reducing sleep fragmentation, reducing REM sleep instability that's inherent to narcolepsy, that's a different story. Then that really does put a dent in the oxybates in a more significant way.

Ami Fadia, Biotech Analyst, Needham: Rich, I'm sure you have you you have thoughts to share on how you guys have thought about developing twenty six eighty on this.

Richard Pops, Chairman and CEO, Alkermes: Well, I think we have a chance of making a real contribution to the whole field in these phase two data because for the first time, we can test a range of doses to explore the whole dose response curve as it relates to sleep architecture. You know, Takeda showed some data at at at one dose last fall, and it was it was provocative but but incomplete. So we'll be able to ask that question because within our six week double blind period, we'll all patients will have a night overnight, and we'll do PSG. We'll be able to look at sleep architecture in a dose dependent fashion. And and I think what then we'll we'll all know a lot more about what it does to sleep architecture.

Of course, the theory is that if you consolidate wakefulness into a big block during the day, you should correspondingly consolidate your sleep into into a in a similar way. That that's theory. You'll you'll you'll see whether that's the case. But I think the the critical point to realize for for investors is that, unfortunately or fortunately, the the oxybates are not the the the entrenched standard of care that must be displaced by a new agent. Of the eighty thousand patients that are being treated, about sixteen thousand are on oxybates.

And what's interesting is a lot of patients have tried them. And because it's worth a shot and because the disease it's such a it's such a devastating disease on day to day lifestyle. They're willing to try it, but they don't most of them don't stick with it for a lot of reasons doctor Carter mentioned. So I think that it's a there may always be a dedicated cadre of people who love what they do for them at night, and and that's fine.

Ami Fadia, Biotech Analyst, Needham: I wanna tie a lot of the, you know, great discussion that we've had and and maybe just, ask this question of maybe doctor Carter. There are multiple variables to think about. Right? Takeda is probably gonna be first to market on n t one, and is probably looking to a follow on product for the other indications. Alkermes has the biggest breadth of data and probably would launch, n t one, n t two around the same time so to follow with NIH.

And we also have Sentessa sort of, making progress in all these three indications. And, you know, we talked about differences in, dosing. We talked talked about different options with regards to kind of the doses that will be available to physicians. How does all of this translate into which product or which products may have the best shot at the biggest market share?

John Carter, Sleep Medicine Specialist and Medical Director, Mental Health Center in Cleveland: Well, a couple of important variables to to consider. One that really isn't trivial is which addressable diagnosis are we dealing with. I mean narcolepsy type one is one third approximately of the total narcolepsy population, whereas NT2 is two thirds. So any agent that's addressing only one third of the market is inherently addressing a minority. But as we see more and more products that address the range of conditions, that's an important thing to consider.

You know, at the risk of giving you a non answer, it really is about the balance, right? So narcolepsy treatment is highly individualized. What's important to me when I'm thinking about which medication prescribe to a patient is how can I line up my therapy to best eliminate their symptoms? You know, are they having day long symptoms? Are they having peaks of symptoms?

Are they having mostly nighttime versus daytime symptoms, etc? And having a wide armamentarium of medications in terms of their peak efficacy, in terms of their PK, in terms of their tolerability profile is really important to me. So the short answer is a diversity of options really matters when I'm selecting among them. If you hold all those things equal, the robustly efficacious medication with know, a reasonable tolerability profile and ease of administration is probably gonna be my first pick.

Ami Fadia, Biotech Analyst, Needham: Okay. Rich, I don't know if you have anything to add here, but, please do. And I we are kind of running out of time, so I do wanted to also touch upon just what are you thinking more broadly beyond 2680. You've sort of talked briefly about, exploring opportunities in other indications beyond the three that we've talked about. So how how are you approaching that, and what will be important to think about as you develop beyond that?

Richard Pops, Chairman and CEO, Alkermes: The way that we're operating right now as a company is almost presupposing that we have a drug for narcolepsy. And I don't mean to be, you know, overly ambitious. Just operationally, you know, that's what you have to do. We're building a factory. We're laying in the supply chain.

We're we're scaling up API because we think that that signal that we've seen in narcolepsy should endure and and mature. And so if you if you think about it that way, if we're seeing effect in in some of these concentric shells that aren't driven entirely by orexin deficiency, the probability of this pharmacology extending to indications beyond excessive daytime sleep is actually quite high. And we've shown some data that you've seen us present in animal models looking at at attention, for example, and mood, and how this this this bundle of neurons that originates in the hypothalamus extends into areas of the brain and drives prefrontal cortical serotonin or norepinephrine, for example. So there are there are ways of looking under the lit lamppost that we think that these agents will affect other conditions. It starts with establishing the safety and tolerability within the most, you know, intense setting in the most risk benefit advantageous setting.

But if we see f f efficacious benefit and tolerability in n t one, n t two, NIH, we're gonna continue. So we're we're actually putting two additional molecules into the clinic this year in anticipation of expanding the program in in that way.

Ami Fadia, Biotech Analyst, Needham: Okay. Unfortunately, I'm being told that we are out of time, and, so I will have to close the session here. I really enjoyed the discussion with both of you. Thank you so much for your time and your very interesting thoughts here, and thanks to all our listeners for joining.

Richard Pops, Chairman and CEO, Alkermes: Thank you, ma'am.

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