Vanda Pharmaceuticals Inc. Q1 FY2025 earnings call

• Commercial Activities: Fanapt's weekly prescriptions surpassed 2,000 at the end of April 2025; Vanda expanded its psychiatry sales force to ~300 representatives. HETLIOZ retained market share despite generic competition. PONVORY's new patient prescriptions reached a record high in April 2025, and the sales force was expanded to ~40 representatives. - Regulatory and Clinical Development: Tradipitant NDA for motion sickness accepted for filing with a PDUFA target date of December 30, 2025. Fanapt and HETLIOZ market authorization applications submitted to EMA. Bysanti NDA for bipolar I disorder and schizophrenia accepted for filing with a PDUFA target date of February 21, 2026. Imsidolimab BLA expected in 2025. - Employee Growth: Talented employees surpassed 400, a 22-year high.

Fanapt: Net product sales were $23.5 million for the first quarter of 2025, a 14% increase compared to $20.6 million in the first quarter of 2024. Total prescriptions increased by approximately 14% and new patient starts (new to brand prescriptions) increased nearly threefold. HETLIOZ: Net product sales were $20.9 million for the first quarter of 2025, a 4% increase compared to $20.1 million in the first quarter of 2024. The increase was due to an increase in price net of deductions partially offset by a decrease in volume. HETLIOZ continues to retain the largest portion of market share despite generic competition. PONVORY: Net product sales were $5.6 million for the first quarter of 2025, a decrease of 18% compared to $6.8 million for the first quarter of 2024, attributable to a decrease in volume.

• Vanda reiterates 2025 total revenues guidance for Fanapt, HETLIOZ, and PONVORY of between $210 million and $250 million. - Year-end 2025 cash guidance is $280 million to $320 million. Revenue range implies 6%-26% growth compared to full year 2024, with revenue likely back weighted due to early commercial launches of Fanapt and PONVORY.

• Generic competition for HETLIOZ could lead to significant revenue decline in future periods. - Uncertainties in variable consideration related to HETLIOZ inventory stocking by specialty pharmacy customers, leading to variability in future net product sales. - Impact of Medicare benefit redesign portion of the Inflation Reduction Act on gross to net for Medicare payer segment of products, particularly affecting Fanapt and HETLIOZ.

Q: Hey, thanks. Good afternoon. Thanks for taking my questions. I wanted to stick on the theme of pipeline today. So, notice that the Phase III MDD data for milsaperidone or Bysanti could read out in 2026. So, I'm just curious what kind of placebo adjusted change on MADRS or HAMD would you want to see for a competitive profile?

A: Yes. Thank you, Andrew. We have not pre specified a margin. Of course, there are a number of antidepressant drugs and the variability on HAMD response or MADRS does not necessarily mean a drug is better than another, because you do know the tremendous degree of variability in major depression studies. But the primary endpoint will be change from baseline as compared to placebo.

Q: And secondly, you're starting a social anxiety study Phase III for 765. Any color around the study design and how you power that study? And when could we get data for that?

A: Yes. I'm not going to be able to answer this time the question about when to get data. This study is set to begin sometime later this year, likely in Q3. In terms of design, I would refer you to the design of the study that we've conducted before and it is soon to be published. The paper has been accepted. And it is a classic design that you may have seen with others who develop similar drugs using the Trier test in Trier naive patients.

Q: Great. And my last question is on Tradipitant for gastroparesis. It sounds like you do have correspondences with the FDA lately. What is your latest strategy and messaging around why this should be approved and when can we hear next steps? And then, lastly, lastly that is, in the best-case scenario, do you refile the drug for review again or is the FDA going to make another PDUFA type decision later this year when you meet with them?

A: Yes. Thanks, Andrew. So, the, it is still the same review cycle that we got the complete response letter in September of last year. And as specified within the statute, we were given the opportunity for a hearing. That process unfortunately is very complex, because an opportunity hearing by the FDA does not mean you get a hearing. It means that they're going to think about whether SEDAR, the review division will propose to the commissioner whether to have a hearing or not. And then, the commissioner will decide whether to have a hearing and if yes, the commissioner will conduct a hearing. It sounds complicated, it is, it should be. And also, it is not a path commonly taken. In fact, to our knowledge, the FDA has held no hearings for a long period of time for the approval of new drugs. So, new filing is not required. We have requested to begin this process. Hopefully, we're going to hear soon and answer whether SEDAR will propose to the commissioner to have a hearing or not, and then the commissioner will take that advice and make a decision.

Q: Okay. Thanks, Kevin or Mihael and team. Congrats on a nice Fanapt number. I had a couple of questions on that and then for the pipeline. With regard to Fanapt, I've actually noticed some direct-to-consumer -- a direct-to-consumer campaign while catching the Stanley Cup playoffs. And I'm wondering if you could give us a sense of, first of all, how long that will run and kind of how do you measure a return on the investment? Are you gaining traction with that and is it primarily for bipolar or schizophrenia patients? I imagine the former.

A: Yes. Indeed, this quarter, I mean the first quarter, we initiated direct-to-consumer campaign that addresses bipolar disorder in one commercial and PONVORY in a second one. And we also have made a concerted effort to increase the awareness of the Vanda brand that helps a lot with recognition by prescribers, patients, key opinion leaders. We've been receiving very good feedback and it is validating what people in this field already know that this is a promotionally sensitive market, especially bipolar disorder and therefore, a direct-to-consumer awareness campaigns are fruitful.

Q: Yes. It would seem to be the case with the new to brand key performance metrics. So, congrats on that. Second question is on Bysanti and the upcoming ASCP presentation. I guess I'm wondering what would you focus attention to on that? I don't believe we've seen any data yet on Bysanti or milsaperidone. So, what is it that you anticipate being able to take away from that presentation with regard to the call it bioequivalence?

A: Yes. So, as we described earlier, the discovery that Vanda made as we're studying this active metabolite of iloperidone, milsaperidone. We realized that surprisingly, we know almost no other example of a drug that behaves like that. There is a quick interconversion in the body, so that milsaperidone is metabolized to iloperidone and vice versa. So, we tested this hypothesis and eventually conducted these two critical studies that are really the core of the submission of this new drug application. We have discussed this with the FDA and these are the studies that will be published at the Scottsdale Conference. So, in these studies, you're going to see two designs. One of them is a single acute dose crossover study and the second one is multiples doses to steady state to the maximum dose and then a crossover study. So, with this, we complete the package that not only confirms that the two products are bioequivalent with each other at a low dose, but also it confirms that at the high dose, they are bioequivalent as well, which indirectly suggests also linearity.

Q: Very helpful. Looking forward to that presentation. Last question is more strategy and that is I'm intrigued with the EMEA filings for both Fanapt, as well as HETLIOZ. And I guess, I'm kind of wondering, what -- how do you see the market opportunity in Europe for the antipsychotic market and I'll call it, unmet need and your ability to market the drug over there? And have you received 120 day questions that would, it's probably right on the edge, but have those come in yet?

A: So, I will answer the last first. Yes, as you know with the timing, the D120 questions have arrived and we're just actively working through them right now. Now, in terms of the expectation of market-to-market response in Europe. As you know already, the pricing and reimbursement in Europe is very tough for antipsychotics. However, there is a good appetite for the long acting injectables, but you can't get there without having first the approval in the indication with the oral. So, we see this as a two-step. Now, in terms of capabilities, I remind you that we have had a presence, strong presence in Germany with our own marketing and sales force for [hep] use in non-24 for the last 10 years. So, we have actually quite good understanding of Germany dynamics, although actually we interact with other countries as well, but of course, Germany is the focus, given the more favorable reimbursement environment there.

Q: Good afternoon. This is Dan on for Ram. Congrats on the earnings beat and thanks for taking our questions. So, what is likely to be the total market opportunity for Bysanti in major depressive disorder? And do you think it would compete directly against Tradipitant successful? I'd like to ask a follow-up if I could.

A: Definitely, it is in the same space. And the designs of this study and the CAPLYTA studies are very close to each other. So, it is about resistance, treatment resistant depression and then adjunct treatment with Bysanti. Also to point out is that, we're testing a one dose a day. And I remind you that for bipolar and schizophrenia acute indications, we have used twice a day dosing. So, the population will be very similar to that of CAPLYTA and the once a day convenient dosing will be there as well. Of course, we think there may be advantages to the Fanapt profile of CAPLYTA and other competitors, especially on the tolerability regarding Akathisia that you see with drugs like [Bralor] or peripheral neuropathy that you may see with CAPLYTA.

Q: Thank you. And next, for the follow-up, when might the lipid ester formulations of the Bysanti to the clinic as long acting injectable formulation?

A: Thanks. The first long acting injectable, which is now initiating the Phase III study is the Fanapt long acting injectable. The milsaperidone, the Bysanti long acting injectable is still in the formulation phase. But as we noted in the prior release, the fact that Bysanti has a terminal hydroxyl group. It makes it amenable to development of lipid esters. And as you know, various lengths of these lipid esters have translated to various lengths and duration of the drug in the blood, where you can make doses once a month, maybe three months, and we've seen with other drugs six months.