Neurocrine at BofA Conference: Strategic Moves and Market Challenges

On Tuesday, 13 May 2025, Neurocrine Biosciences Inc. (NASDAQ:NBIX) presented at the BofA Securities 2025 Healthcare Conference. The company outlined its strategic initiatives, highlighting the promising early performance of its new drug Crinesity and ongoing challenges from macroeconomic factors. While the launch of Crinesity has been strong, concerns about executive orders and tariffs remain on the horizon.

Key Takeaways

• Neurocrine’s Crinesity exceeded expectations with $14.5 million in sales last quarter.
• The company is advancing research into schizophrenia and bipolar mania.
• Redundant supply chains in the U.S. and Europe help mitigate tariff impacts.
• Neurocrine plans to invest $125 million in SG&A this year.
• Safety and tolerability are emphasized as key factors for Crinesity’s adoption.

Financial Results

• Crinesity generated $14.5 million in sales in the last quarter.
• The reimbursement rate for Crinesity stands at approximately 70%.
• Neurocrine plans to spend an additional $125 million on SG&A.
• R&D expenses are projected to be in the mid-30s percent range of net revenue.

Operational Updates

• Crinesity’s launch has seen over 400 new patient start forms in the last quarter.
• The company is focusing on educating physicians and patients about congenital adrenal hyperplasia (CAH).
• A Phase III study is ongoing for valbenazine for dyskinesia associated with cerebral palsy.
• Neurocrine is exploring targeted media outreach strategies for Crinesity.

Future Outlook

• Crinesity is expected to become Neurocrine’s next blockbuster drug.
• The company plans to drive early adoption among pediatric and adolescent populations.
• Neurocrine is preparing a long-acting injectable using the five seventy compound.
• A phase two trial for schizophrenia is planned for the five seventy compound.

Q&A Highlights

• Safety and tolerability are crucial for CAH treatments, according to Neurocrine.
• Initial Crinesity prescriptions were split between adults and pediatrics, with a trend towards pediatrics by the end of the quarter.
• Direct-to-consumer advertising is seen as effective for prevalent disease states.
• Redundant supply chains across the U.S. and Europe support both INGREZZA and Crinesity.
• The company did not meet the primary endpoint for adjunctive treatment of schizophrenia but gained valuable insights.

Readers are encouraged to refer to the full transcript for a detailed account of Neurocrine’s presentation and strategic insights.

Full transcript - BofA Securities 2025 Healthcare Conference:

Unidentified speaker, Interviewer: At the firm, it’s my pleasure to have with us our next presenting company. That would be Neurocrine. Presenting for Neurocrine is CEO, Kyle Gano. Kyle, congratulations again for becoming CEO of the company. It’s been a few months now, right?

Kyle Gano, CEO, Neurocrine: Since October.

Unidentified speaker, Interviewer: So you’re now a pro, so all problems can be rolled back to you, I’m sure. Also on stage is Todd Tushla, our favorite IR person

Kyle Gano, CEO, Neurocrine: of Oh, lovely do. Thank you, Tushla.

Unidentified speaker, Interviewer: So why don’t we talk about some macro issues because we’ve started all of our conversations so far this morning on that, maybe with the most recent one, the executive order that was announced yesterday as it relates to most favored nation. So we are all still awaiting more details, but to the extent that you can comment on what kind of impact to expect on Neurocrine?

Kyle Gano, CEO, Neurocrine: Sure. I’ll start there. Maybe to interject with our lawyer’s view, we will be making forward looking statements, so I direct everyone to our latest SEC filings for the risk factors. In terms of the latest executive order, which we saw yesterday, I think we were all on the edge of our seat to see what it actually looked like given some of the rhetoric that came out over the weekend, some postings on social media. But at the end of the day, similar to what we’ve been saying about tariffs and other aspects of some policy and other executive orders that have come out in the past couple of months.

It’s still very early days and we lack a lot of details on what actually is the true intent of the President here in terms of what we saw yesterday. At the end of the day, after reviewing all the information in totality, we appreciate that there is a view that we need to prevent basically foreign leveraging of our data and our medicines that we have here in their countries at a lower price. We get that, we understand that, I think we share in that same sentiment. We’ve also seen the setup of the President to allow a health team within the administration to set in place or in motion the terms and the communication to manufacturers on most favored nation targets. HSS then would have the ability to define rules and implement those between this team and the manufacturers that have medicines that are outside The U.

S. And ultimately, if there’s not significant process, again this is kind of referring to language in the Executive Order, the government could potentially import the lowest priced medicines within this most favored nation basket and bring those to The U. S. At the lower price. But not a lot of data here on how this actually gets played out and pulled through.

We don’t know what elements of the Medicare or Medicaid are part of this vision. Is it ABD? Is it Medicaid as well? What list of drugs are underneath these different categories? Is it all the medicines?

What nations are part of the most favorite nation basket? So there’s a lot of things that we still see out there as needed details to really comment specifically. So like these other things that we’ve discussed and seen over the past few months, early days, a lot of details to be worked out. What we’re going to try to focus on are those things that we can control, which is building Neurocrine into a strong resilient business and doing best for our shareholders and our patients. And we’ll continue to evolve this, keep an eye on this evolving situation.

Where there are things that we see impact the business, we’ll be sure to let everyone know.

Unidentified speaker, Interviewer: Okay, next macro question on tariffs.

Kyle Gano, CEO, Neurocrine: Yeah, so tariffs kind of in the same basket where we start with executive orders. I mean, at a high level, we’re really talking about here are the component parts that lead to our drug product that’s available for commercial sale, not the actual commercial product itself. And we have redundant supply chains across The U. S. And Western Europe for both INGREZZA and for Carnicity.

Ultimately, when we look at the component parts here, they add up to a very low cost of goods medicine with high gross margins. And we don’t see tariffs, playing a very significant role at all in terms of how they might affect our business. So I think we’re in pretty good shape there.

Unidentified speaker, Interviewer: Okay. And then lastly, your interactions with FDA to the extent that you’ve had recent ones, let’s say, over the last eight weeks or so, have you noticed anything in terms of the same people or timelines extending or any kind of data point you can share?

Kyle Gano, CEO, Neurocrine: Sure, that’s a great question. I mean, there’s lot of obviously uncertainty in our industry right now with the meaning of all the executive orders that have come out ranging from the tariffs as you’ve raised as well as most favored nation. But on the FDA, there’s also changes that are going on there now. I’m extremely thankful that we have nothing in NDA review currently. Princeton was approved in December so we don’t have to worry about something like that being in the hands of the FDA right now.

Our most important, FDA interactions just occurred over the past couple months, in particular, in the Phase II discussions which outline the scope and breadth and depth of our Phase III programs for osavampoetor and MDD, as well as our Schizophrenia Phase III program for MBI-five sixty eight. So those are also out of the way. So most of our interactions this year, I would say, are lighter discussions about programs coming into the space, IND submissions and things of that sort. So we’re very pleased where we are going through this era of change at the FDA. But ultimately, we’re not seeing any timeline changes or any effects to our business even with some of these other interactions that we anticipate, having over the course of the year.

So so far so good. Again, we do have a team that, follows this news in DC, and if there’s something there that we see changing in this view, we’ll, let everyone know.

Unidentified speaker, Interviewer: Okay. Perfect. Now on to Neurocrine.

Kyle Gano, CEO, Neurocrine: Very good.

Unidentified speaker, Interviewer: All right. So I actually want to start off with Crinesity, Canestrafont. You’re off to a strong start on the early innings, very early innings of the launch. So, last quarter you recognized 14,500,000.0 in sales, north of 400 new patient start forms. That came in above, I think, what even the most bullish people were thinking would be the case.

And also an impressive number was, I think, 70% reimbursement rate, close to it. So based on how you were guiding us, has anything changed? Should we still be thinking about the launch in the way you know, you described it when the drug was initially approved?

Kyle Gano, CEO, Neurocrine: So, I’ll start a little bit and then I’ll ask my colleague here, Todd, to add anything that I miss that goes across the board here on our But in terms of the launch, what we like to say out there is so far so great. It really has been a nice early start to the launch, but we don’t feel that our messaging has changed at all in terms of how we view this launch in and of itself. We do feel that measured is still the appropriate word to describe what we’ll see over time. The reason for this is that there have been no medicines approved for CH in over seventy years and that first medicine seven years ago and only medicine was hydrocortisone. So there is a certain level of education that’s required in this space to effectively move a medicine into the armamentarium of the physician as well as adding that onto the patient’s care on a daily basis.

And that education is directly related to the in office interactions that these patients are having with their physicians. And we know that all patients are created equal, not only in terms of their symptoms and what’s important to them, but also how frequently they’re visiting the physicians. So you’ve got pediatrics in the adolescent patient population, which could be a mix of boys and girls, are obviously cared for by their parents. They tend to be the most frequently visiting their physician office two to three times per year. And then we move slowly to adult women and then to men, and the number of office visits drops off pretty significantly from there, where you might see one to two office visits per adult woman and maybe one for the men.

And when you’re trying to change that standard of care and change that education, you really have to get through those first visits and maybe another visit before you get the physician and patient on board for trying a medicine that they didn’t know was available this time last year. So we do see that playing out and that’s part of the measured launch that we’re working with here. We also are in a state where we’re not on any of the formularies out there. So patients that want to get a prescription, they have to work through that insurance process and that can also take time as they go through prior authorizations and things of that sort. So coming out of the gate, we like what we see in Q1, but we have this goal of changing the standard of care that’s going to take time and also working through the insurance reimbursement landscape.

So that will play out over the course of the coming year and years. But right now we’re off to a good start.

Todd Tushla, IR, Neurocrine: I’ll just add one additional point. Comes up in questions with investors. We do have an open label extension study where greater than ninety percent of the patients in the adult and pediatric registration study enrolled into. And IRI announced on the Q1 earnings call that The U. S.

Adult portion of that study is going to roll off over the coming months. So that’s about 50 or so U. S. Adults that will eventually become paying customers. That’s not gonna happen all at one time.

So you won’t have this bolus of 50 patients that’s gonna occur over weeks and months.

Unidentified speaker, Interviewer: Okay. Thanks for that color, Todd. Just sticking to this launch. So I think you said that in terms of the age distribution, was it 50% adults?

Todd Tushla, IR, Neurocrine: Early, it was a between adults That’s right. But then it started to trend a little bit more towards peds at the end.

Unidentified speaker, Interviewer: So in terms of that little bolus of adults at the beginning, and I say that because as you’ve talked about, adults tend to see their physicians with less frequency. Where were they coming from, do you think?

Kyle Gano, CEO, Neurocrine: We think that there are, just like any disease state, there are patients that are really on top of their care. And, it could be as simple as that. The early adopters that you see, in certain medicines, certain classes in terms of how they approach their care, Those are maybe that’s the simplest explanation. It could be also the time a point at the beginning of the year when they see their physician. Just happened to correspond with the launch of the medicine.

We’ll see how this all shakes out over time. I do think that we will see the pediatric and adolescent patient population be, at least in the near to mid term, the patient group that is starting Credenceity First because of the drive in patient or the parents to get their kids on the medicine. Because the longer or earlier you start, the longer that you’re on the medicine, the greater benefit that you’ll see.

Unidentified speaker, Interviewer: Yeah. And on the point of the seventy percent reimbursement rate, you talked at the beginning about needing potentially several weeks to, you know, low months, for-

Todd Tushla, IR, Neurocrine: Iron out the payer dynamics.

Unidentified speaker, Interviewer: Yes. So at least in certain cases, it seems like it’s going a little bit faster than that. Can you talk about like what types of payers are more streamlined and what types might require more handholding?

Todd Tushla, IR, Neurocrine: Yeah, I’d say there’s a handful of payers that have already made coverage determination criteria. And it’s encouraging what they require. It’s right in line with the label that you have to have a diagnosis of classic CIH. You need to be four or older and you need to be on a glucocorticoid. So that’s all encouraging to see, but a majority of the reimbursed scripts in Q1 were through the exceptions process that we know how to manage well.

Via INGREZZA, we’ll continue to work through the plans through the course of the balance of this year. Something that we continue to work through.

Unidentified speaker, Interviewer: So would we be noticing any difference between now and when, Cranesiti is formally added to formulary?

Todd Tushla, IR, Neurocrine: I think we feel pretty comfortable and it was surprising to have the reimbursement rate as high as it was in Q1, given some of the work that we had done upfront. So that’s just going to be an evolving, number over the course of the year until we get into the calendar, next calendar year, I think.

Unidentified speaker, Interviewer: Okay. Now, terms of finding patients, because I guess the pediatric and adolescents, let’s say, see the doctors more frequently, are we right to assume that maybe the initial few quarters will be, like as you said, at the end of the quarter was shifting more towards peds and adolescents? Do you expect that trend to continue near term?

Kyle Gano, CEO, Neurocrine: Yeah. I think it’s reasonable to think about that just from a motivational factor, again, by the patient’s parents wanting to get on medicine as early as possible in the course of their life for the greater longer term benefit, as well as their frequency of interactions with the physicians. That’s that’s logical to think that way, and, I think that will play out, but, you know, let’s see what the data looks like in a couple of quarters.

Unidentified speaker, Interviewer: And how would DTC look like for Chronacity versus what was done for INGREZZA?

Kyle Gano, CEO, Neurocrine: Well, think that DTC is a tool directed to consumer advertising can work well for disease states that have higher prevalence numbers. You know, with INGREZZA there’s eight hundred thousand patients and there’s families and caregivers watching over those 800,000. So the reach of individuals that might be affected by TD in some shape or form is quite large. In contrast, for CH, we’re talking about a disease with a prevalence of twenty thousand to thirty thousand. Of course, there are family members and caregivers that go around that, but a much smaller patient pool.

So I think traditional direct to consumer advertising may not be as effective here, at least from an ROI perspective, because you just don’t know where the patients are definitively to get the benefit out of your TV advertising, if you will. So I think we’ll be looking at more targeted ways of accessing media, whether it’s internet based, social media, things of that sort that would give us access to patients that might be using those types of tools, learn about their disease state. But I think right now where we are in the commercialization effort is trying to identify what those different media types are that patients are using. And then once we have a good idea for that, then what would it make sense for us to invest in to help us identify these new patients? Because the goal here is to do two things.

One is to ensure consistent growth of the medicine over time. We want to make sure that we’re accessing all the patients that need the medicine. And we’re also trying to do this as quickly as we can because we know we don’t want to have another patient wait another day. There’s no reason for that when they’ve got a medicine that benefits the patient the sooner they start on it. So both of those are top of mind.

So it is a goal that we identify the best tools to reach these patients and their families, and we’ll be doing that over the course of this year.

Unidentified speaker, Interviewer: Okay. So as you think about the evolution of this launch, obviously Sellside has its own view about where sales could peak. Just in terms of the size of the population, would it be wrong to consider this a blockbuster indication, meaning north of $1,000,000,000 in sales?

Kyle Gano, CEO, Neurocrine: We think this could be our next blockbuster for sure. And that’s one of the things that we think we’ve always said from the get go. We’re incredibly excited about having the opportunity to have another first in class medicine for patients first and foremost. I think you see a trend here over Neurocrine’s history, in the sense of even Orlyssa with AbbVie that they commercialized, that was a first in class GnRH antagonist to INGREZZA, that was a first in class VMAT2 inhibitor for tardive dyskinesia and now with Crinesity, first in class CRFR1 antagonist for Being that company that develops medicines like that is very rarer. I think that gives you the opportunity, a loose guy opportunity, to really reach patients and their families and potentially change the course of their disease.

And when you’re talking about patient population that we have in the absence of the medicine over decades, we also think that they’re equally excited about having the opportunity to try something and benefit from it. I think it’s a perfect, number of variables coming together here, for Neurocrine, for Crinesity that leads to a very significant upside for the medicine.

Unidentified speaker, Interviewer: Yeah, so you became the first approved drug in this space, but interestingly it’s coming at a time where interest in CAH in general has increased and that’s good for patients. So as you think about the potential for, I don’t know, one or two competitors to enter over the next few years, how are you thinking about the size of the opportunity? Is it big enough to support more than one drug? And if you think about, you know, ways in which, Neurocrine can differentiate either in terms of the way you’re launching the product or in terms of Coneste itself, what would those things be?

Kyle Gano, CEO, Neurocrine: Yeah, I think we’re, you know, I mentioned the different medicines that we’ve played a role in over the years. In each of those medicines that we brought to market, we’ve always brought forward at least one competitor. So it’s a bit of a sign of pride that we can shine a light on a disease state and bring others into it. Ultimately, I think you touched on this, it benefits patients to have different options and that is rewarding. So in terms of competition in our space, I try not to talk that much about it given that the data that we’re often asked to compare is not apples to apples, it’s apples and oranges.

So it’s really hard to make any comparative remarks. But I do think CH is one of those disease states where efficacy gets your foot in the door, but safety and tolerability once a day for both approval and adoption by patients, and in this case parents and family members as well. And what we have is that in spades with Cranesity and it all starts with our approach. With the CRF antagonist we work upstream at the HP access and allows us to reduce and control ACTH all the way down to the androgens. And all those pieces from ACTH to the androgens themselves are important factors of how the disease progresses and the side effects of treatment.

So we do think we have the optimal approach here ultimately. You know, something like ACTH, it’s something that we hear a lot about from our competitors, either monoclonal antibody or ACTH antagonist. ACTH is something that binds to ACTH receptors throughout the body. You can’t forget it’s not just on the adrenal gland, it’s everywhere throughout the body. And excessive ACTH stimulation is not something that’s been well studied and it’s hard to view that pre clinically.

So the consequences of long term excess of ACTH is an unknown that our competitors have to address and we don’t have that issue because we’re able to reduce that, control that with Chronicity. So we like our approach. We’ve got a medicine that has great efficacy, great safety and tolerability that translated into a very nice label, and we think that we’ll be able to treat the vast majority of patients that are available for CAH treatments by the time another potential medicine comes to market.

Todd Tushla, IR, Neurocrine: Yeah, I just want to punctuate on the safety and tolerability. That’s supremely important, especially for the pediatric patients here. And KRONESTI has been studied in over 1,200 patients. And in CAH specifically, there are some patients that have probably been on the drug for four years now, or plus. So really pleased with the balance between efficacy and safety and tolerability that gives us a competitive edge.

Unidentified speaker, Interviewer: Yeah, last question on Carnicity and then we’ll move on. You’re making a lot of headway early and it looks like it’s shifting initially towards the peds population. But if I understand correctly, there’s actually, the adult population size wise would be bigger over time.

Todd Tushla, IR, Neurocrine: That’s two thirds the size of the patient population, that’s right.

Unidentified speaker, Interviewer: Yeah. And so how, what are the efforts that you’re making to try to find these patients?

Kyle Gano, CEO, Neurocrine: Well there’s, I would bifurcate the adult patient population as well from women and men. The women are more motivated than say the middle aged man for a number of reasons, but you can look at irregular menses, hirsutism, infertility, things of that sort that they could potentially improve by being on crinesthesis. So they’re more motivated than the general male. I think that’s what you’ll see as time moves along. We’ll have more women than men as well.

On the adult men side of the equation, really for all the patients, you’re able to track, their diagnosis codes and claims databases. You’re able to track, prescriptions of hydrocortisone in the same databases as well. And you can triangulate where these patients are from a geographical standpoint and be targeted in how you look at capturing patients that might be visiting offices that are in the area. I think that’s something that we look at and there’s more that goes around that. But at a high level, that’s a practice, a tool that many companies use to identify patients in a given disease state.

So those are things that we’re looking at more traditional ones and we’ll be able to marry that with some of the media outreach that we’ll be doing over time to help us bring patients into the office as well and ask about chronicity. But like the disease state and changing the standard of care, identifying patients is going to evolve as well with us as we learn more about where these patients are.

Unidentified speaker, Interviewer: Okay. So maybe let’s ask a few questions about pipeline because I know this was always Kevin’s pet peeve that I thought you guys had no pipeline, but you’ve always had a pipeline. So can you just remind us of what data sets to expect this calendar year, and then we’ll talk about beyond?

Kyle Gano, CEO, Neurocrine: Sure. So a couple data readouts this year. You know, we often talk about externally, it’s a year of execution evolution, and the execution side of things is in a couple areas. We talk a lot about the commercial side of the business and Graza, chronicity, so obviously need to execute well there to treat as many patients as we can. And then there’s execution on the pipeline, and that comes in a couple different flavors.

One is making sure that we start all of our Phase III trials for osavapitur and five sixty eight. But the piece that we often overlook too, because everyone’s excited about what’s moving into Phase III, is the data readouts that we have available this year. So we have a couple, just no random, just no particular order. Maybe a little bit interesting to me is the NR2B NAM, the NBI-seven 70 program that we have. This is a program that allows us to potentially have a fast onset of action in major depressive disorder, same type of approach that you might see with esketamine, but oral and, have a much better or improved profile as it relates to things like dissociative effects.

So we have that study that’s ongoing now that we’ll read out, towards the end of the year and that looks at three doses of active versus placebo. It’s a small study, about 70 subjects, but it’s consistent with our signal seeking approach in early phase two development that we’ve employed over the years. And this is looking at the Madras as the primary endpoint day five. So that fast onset of action is what we’re looking for here.

Unidentified speaker, Interviewer: What is fast in your definition?

Kyle Gano, CEO, Neurocrine: Fast? Within a week. You you look at the SSRIs or even ocevampitur in our phase two program and oftentimes the efficacy endpoint can be four to eight weeks. So we’re looking at something that’s more of that faster onset that you can get with like an esketamine or ketamine approach. So that’s MBI-seven 70.

Keeping with the second half of this year, we have a phase three study ongoing for valbenazine for the dyskinesia associated with cerebral palsy. This is a movement disorder, so kind of in our wheelhouse with TD Huntington’s chorea. Cerebral palsy, as you know, is a consequence of perinatal trauma in utero or during childbirth. When this occurs, you often get, damage that occurs throughout the brain, and one of the consequences of this is motor fluctuations, motor disturbances, and dyskinesia is the most common one. And this is, ultimately is in the region of the brain, the basal ganglia, which is important for the VMAT2 mechanism.

So we think it seems reasonable to test the biology here for these patients that suffer from dyskinesia. We also know that physicians use VMAT2 inhibitors in some of their patients and seen success. So we’re looking at a study here that has about 80 subjects where the primary endpoint is the total modal chorea score which is the subset of the UHDRS, the Huntington scale, and we’ll be looking at the mean change between week twelve and fourteen to baseline. This would be of course relative to placebo. So that will come out, towards the second half this year depending on the strength of the data, what safety and tolerability looks like and if it’s a positive outcome if we take to the agency and they say it looks good as well, that could be an indication expansion opportunity for Valbenazine.

And then the last study that we have reading out this year is the adjunctive treatment of schizophrenia. This is not an indication expansion opportunity for Valbenazine. It’s a learning study. This looks at about four hundred patients with schizophrenia. They’re not getting completely, their symptoms completely resolved using an antipsychotic.

And this is a study that we just got the data, it’s hot off the press, the past couple days we’ve gotten our hands on this and the data was as expected. We did learn a lot from the study, but we did not meet the primary endpoint of improvement of PANSS at week 10. We did see numerical separation there relative to placebo and we did see a statistically significant effect on the positive symptoms of the PANS, but we didn’t see it on the total PANS score. We did see also numerical differences, improvements of valbenazine versus placebo and all other key measures. We had the moderate factor scores in there as well, as well as some other biomarkers that are important in schizophrenia and they all favored valbenazine.

So we did learn a lot from the study. We didn’t meet the primary endpoint, it was a miss on that, but we’re applying back the learnings into the next gen compounds, which represent, are represented by MBI-eight ninety and six seventy five. They’re both in phase one right now. And I think with these learnings, it really does give you insights into the possibilities of VMAT2 inhibition more broadly within psychiatry. I think that’s been the goal here for the next gen compounds.

They’ve been specifically designed to be more potent than INGREZZA and to offer long acting injectable opportunities to take us in these broader disease states where these attributes would be beneficial. So we got what we wanted from the study, but not the ultimate positive result, but the learnings are there and we’ll be able to take that and use those for the next follow-up molecules.

Unidentified speaker, Interviewer: Okay.

Kyle Gano, CEO, Neurocrine: So those are the three readouts.

Unidentified speaker, Interviewer: For this year?

Kyle Gano, CEO, Neurocrine: For this year.

Unidentified speaker, Interviewer: Okay. And then looking on beyond, I wanted to spend a couple minutes talking about, muscarinic because I think, I guess, investors view it now as sort of mixed because, because of, corona, which which is likely successful, followed by the failure of of Serovel. So you’ve got, your most advanced molecule is is your m four, but you’ve also got other molecules that are kind of a mishmash of everything. You’ve you’ve got an m one m four. You’ve got an m one by itself.

So what are you trying to accomplish by looking at all of these different variations?

Kyle Gano, CEO, Neurocrine: That’s a great question. You know, I think that, at a high level, know, zonomeline, one of the two components that are part of Cobenfi has been studied for thirty years. And it’s a pan muscarinic agonist and there’s been very little success in getting selective muscarinic agonist in the clinic to actually tease apart what different pharmacologies could actually bring to the table, both in terms of efficacy and safety and tolerability. Well, that’s changed because Neurocrine has those different flavors in its pipeline or mishmosh, as you said, I

Todd Tushla, IR, Neurocrine: like that.

Kyle Gano, CEO, Neurocrine: So we have four agonists in clinical development. We have ranging from MBI-five 67, I’m gonna drop the MBI here for a moment, 567 is an M1 agonist. We have five sixty eight is an M4 agonist, that’s the one that’s in phase three now in schizophrenia. We have, five sixty nine which has a bit of M4 and M1 and then five seventy is the dual M1 and M4 more equally weighted across those two subtypes. They don’t hit anything else, so they don’t hit M2, they don’t hit M3, they don’t hit M5.

Our collaborator, he did a great job of finding binding pocket that’s only conserved in the two subtypes, M1 and M4, and not in the other subtypes. So we don’t have to add back anything to block peripheral effects that might be important when it comes to GI side effects and tolerability, which are primarily attributed to M2 and M3. Our approaches are the only one that selectively and directly activates the muscarinic subtypes of interest without needing anything else for efficacy or safety and tolerability. And the reason why I bring up safety and tolerability because on the end efficacy is because the PANS that are in this space require coaptivity of the endogenous ligand acetylcholine. So when you would open up an M4 receptor with the PAN, the actual work, the efficacy is delivered by the body’s production of acetylcholine.

Our approaches don’t lean on that at all. They can directly activate these subtypes of interest and that’s what we think is the winning strategy here. We think that the data plays itself out between the Cobempathy Phase II and Phase III data and the miraclidean PAM data, which is quite noisy that we saw from AbbVie in phase three. So our approach right now, we move forward with MBI-five sixty eight. We conducted a phase two trial that read out in q three of last year.

We studied four doses of active versus placebo. The twenty milligram dose, the lowest dose outperformed the higher doses. It’s something that we didn’t anticipate, but it’s not uncommon in this space. But the efficacy that we saw in safety and tolerability was outstanding. That twenty milligram dose showed an 18.2 improvement on total PANS, placebo corrected PANS improvement of 7.5 points, effect size of 0.61 is once a day, there’s no food effect, no titration.

That’s a winning profile relative to the muscarinic and relative to the antipsychotics that are out there. So the goal is to replicate that finding in Phase III and what we’re doing now in the Phase III program is much more simplified study design, one dose of active versus placebo, parallel design. We’re going to have about two eighty subjects across 20 sites and we’ll do a study here in The U. S. And another study to be started here shortly, will be primarily in The U.

S. So we’re excited about what we have there with five sixty eight and schizophrenia, but we’re not done yet. We’ll be expanding the indication, with five sixty eight later this year with a proof of concept study in bipolar mania. And then when it comes to the other muscarinic, really do want to test that hypothesis of what’s the difference between a selective M4 agonist and an M1M4 dual. And we are going to bring five seventy forward into a phase two schizophrenia trial.

So as those studies read out, we’ll be able to compare what does a dual bring to the table versus selective. We also have some other important physical chemical property difference with five seventy that might afford something like a long acting injectable. So we’re excited about the portfolio. We’re the only one that has it, and we’re going to be looking at, ensuring that we understand the pharmacology across all these different sub

Unidentified speaker, Interviewer: Okay. And then if Matt were here, would ask him, how does this plan jive with how you’re thinking about expenses overall for the company?

Kyle Gano, CEO, Neurocrine: Well, in terms of expenses, there’s probably a couple of things. I mean, right now, as you can probably see across INGREZZA, Credensity, late stage pipeline, we really are investing in growth. Certainly profitability is something that we’re looking at, but as a near term strategy to maximize profitability, that’s not the goal right now. On the SG and A side of things, obviously we’re investing big in both INGREZZA and now the launch of Cranesiti itself that takes dollars to do that. But we’ve shown historically we can improve our leverage by 1,000 basis points.

We did that over the past three years And that’s something that we’ll look at doing as time moves along through the Cranesity launch. We’ve also guided this year about $125,000,000 incremental spend in SG and A. So I think it takes care of that component. On the R and D side of things, we usually peg about 30% of net revenue goes into our R and D spend. Right now, we’ve got some big ticket items with our Phase III’s going on.

So I think we would guide to kind of like a mid-30s R and D spend range. And we’ll continue to look at that as time moves along. Ultimately, the North Star here is the quality of the assets and the need to move those forward if they’re aggressively, if they’re high quality assets.

Todd Tushla, IR, Neurocrine: Yeah, I’m not going do an impression of Matt since he’s listening, but he would say it’s a high quality problem to have.

Kyle Gano, CEO, Neurocrine: High class problem.

Todd Tushla, IR, Neurocrine: High class. Hey, Matt.

Unidentified speaker, Interviewer: Hello, Matt.

Todd Tushla, IR, Neurocrine: Too bad for We missed you.

Unidentified speaker, Interviewer: Okay. All right, guys. I think we’re out of time today. Thanks for

Todd Tushla, IR, Neurocrine: Thank you for time.

Kyle Gano, CEO, Neurocrine: Thanks, Tazeen. We’ll appreciate it.

Unidentified speaker, Interviewer: San Diego. And thanks, everybody, for joining us in the room.

Kyle Gano, CEO, Neurocrine: Thanks, everybody.

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