NEUROCRINE BIOSCIENCES INC Q3 FY2024 earnings call

Key Points

• Kyle Gano, new CEO, emphasized the company's strong position in neuroscience, citing INGREZZA's multibillion-dollar franchise, Crinecerfont's potential, and a robust pipeline.
• Board authorized a $300 million share repurchase plan.
• INGREZZA sales grew over 26% year-over-year in Q3, with annualized sales at over $2.4 billion. The salesforce expansion in psychiatry and long-term care is complete.
• Crinecerfont's rare disease endocrinology team is focused on disease state education for congenital adrenal hyperplasia (CAH), with plans for launch preparation.
• Pipeline updates: NBI-’845 and NBI-’568 moving into registrational studies; Luvadaxistat deprioritized; NBI-’890 (NextGen VMAT2 inhibitor) in Phase I.
• R&D investment expected to increase, likely to be in the low-to-mid 30% range of revenue in 2025.

INGREZZA delivered $613 million in Q3 sales. The company has revised its full-year INGREZZA guidance to a range of $2.3 to $2.32 billion, reflecting 25% year-over-year growth at the midpoint. Crinecerfont, a potential blockbuster, is on track for potential approval by year-end, with its rare disease endocrinology team focusing on disease state education. INGREZZA contributes significantly to revenue, with ongoing growth driven by patient demand in Tardive Dyskinesia and Huntington’s Disease Chorea indications.

Guidance Points

• INGREZZA full-year guidance revised to $2.3 to $2.32 billion, reflecting 25% year-over-year growth at the midpoint.
• Board approved a $300 million share repurchase plan, with intention to enter into an accelerated share repurchase transaction.
• Anticipate R&D investment to increase in 2025, likely to be in the low-to-mid 30% range of revenue.
• Crinecerfont remains on track for potential approval by year-end 2024.

Risks

• Drug development risks, including uncertainties in clinical trial outcomes and regulatory approvals.
• Competitive pressures in the TD market, with potential challenges in maintaining market share.
• Reimbursement challenges for newly launched products like Crinecerfont, including potential coverage restrictions by commercial payers.
• Pipeline execution risks, including the need to successfully advance multiple programs through clinical stages.

Q: Chris Shibutani from Goldman Sachs asked about the NextGen VMAT2 inhibitor (NBI-’890) and pipeline strategy.

A: Kyle Gano stated NBI-’890 is in Phase I, with plans to move into patients next year pending review of Phase I data.

Q: Paul Matteis from Stifel inquired about business development strategy.

A: Kyle Gano and Matt Abernethy mentioned focus on executing current pipeline programs and evaluating potential external opportunities if they align with expertise.

Q: David Ansellem from Piper Sandler asked about INGREZZA pricing and IRA impact, and NBI-’568 indications.

A: Kyle Gano noted expected net revenue per script in 2025 to be similar to 2024; Eiry Roberts discussed NBI-’568's Phase III plans and muscarinic pipeline.

Q: Tazeen Ahmad from Bank of America asked about INGREZZA sequential flow in 4Q.

A: Matt Abernethy mentioned historical sequential growth range and factors like new sales team and channel inventory impact.

Q: Jay Olson from Oppenheimer asked about epilepsy commitment.

A: Kyle Gano stated continued commitment to epilepsy with preclinical programs and a mixed NaV1.2, NaV1.6 inhibitor in development.

Q: Ash Verma from UBS asked about NBI-’568 and muscarinic pipeline.

A: Eiry Roberts discussed NBI-’568's Phase III plans and the broader muscarinic pipeline's potential indications.

Q: Evan Seigerman from BMO Capital Markets asked about INGREZZA salesforce expansion and TD epidemiology.

A: Kyle Gano and Eric Benevich discussed TD prevalence updates, salesforce expansion rationale, and Huntington's Chorea opportunity.

Q: Cory Kasimov from Evercore asked about Crinecerfont prescribers and patient focus.

A: Eric Benevich and Eiry Roberts discussed CAH prescriber focus, patient interest, and team receptivity.

Q: Brian Skorney from Baird asked about psychiatry pivotal trials for NBI-’845 and NBI-’568.

A: Eric Benevich and Eiry Roberts mentioned parallel progression of trials post Phase II meetings.

Q: Carter Gould from Barclays asked about early-stage pipeline.

A: Kyle Gano stated early-stage portfolio includes various assets, with more to be revealed in 2025.

Q: Joe from RBC Capital Markets asked about INGREZZA growth drivers and competitive landscape.

A: Eric Benevich discussed INGREZZA growth driven by demand, competitive dynamics, and salesforce investment.

Q: Mohit Bansal from Wells Fargo asked about Crinecerfont competition.

A: Kyle Gano discussed Crinecerfont's differentiation from ACTH antagonists and its efficacy, safety, and formulation advantages.

Q: Marc Goodman from Leerink Partners asked about INGREZZA competitive noise.

A: Eric Benevich stated INGREZZA is the most prescribed VMAT2 inhibitor with strong growth and salesforce investment.

Q: Myles Minter from William Blair asked about Crinecerfont clinical trial definitions.

A: Eiry Roberts discussed clinical trial definitions and Crinecerfont's efficacy in CAH populations.

Q: Michael Riad from Morgan Stanley asked about NBI-’770 program.

A: Eiry Roberts discussed NBI-’770 as an adjunct to antidepressants and its potential benefit-risk profile.

Q: Laura Chico from Wedbush Securities asked about TD severity breakdown.

A: Kyle Gano discussed TD severity lack of standard definition and ongoing growth opportunity.

Q: Thelma from Guggenheim asked about NBI-’845 pivotal program strategy.

A: Eiry Roberts stated Phase III strategy will be clarified post Phase II FDA interaction, with Phase II data to be released in late 2025.

Q: Uy Ear from Mizuho asked about Crinecerfont launch free drugs and demand.

A: Eiry Roberts and Eric Benevich discussed long-term extension programs and reimbursement challenges in Crinecerfont launch.

Q: Buna from Needham & Company asked about NBI-’845 FDA meeting expectations.

A: Eiry Roberts discussed FDA meeting to clarify Phase III strategy for NBI-’845 in major depressive disorder.