Vanda Pharmaceuticals Inc. Q2 FY2025 earnings call

Management Statement and Operational Highlights

• Fanapt: Expanded sales force to ~300 representatives, total calls grew >40% Q2 2025 vs Q1 2025 and >400% vs Q2 2024. Revenue up 27% Y/Y due to bipolar I indication launch. Sales force expansion and broad awareness campaign driving growth.
• HETLIOZ: Continues as market share leader despite generic competition for over 2.5 years. Impacted by inventory stocking at specialty pharmacies, with potential future variability in sales.
• PONVORY: Building out dedicated sales force for multiple sclerosis, aiming for ~50 representatives by Q3 2025. New patient prescriptions in Q2 2025 reached record high since commercial launch.
• Regulatory Updates: NDA for Bysanti accepted by FDA with PDUFA target of Feb 21, 2026. NDA for tradipitant for motion sickness expected to file by Dec 30, 2025. BLA for imsidolimab for generalized pustular psoriasis expected in 2025. PONVORY investigational new drug applications accepted for psoriasis and ulcerative colitis.
• Early-Stage Programs: VQW-765 in Phase III for acute performance anxiety; VCA-894A IND accepted for Charcot-Marie-Tooth disease.
• Public Policy: Responded to HHS RFI, proposing FDA repeal of certain regulations delaying drug approval.

Segment Performance

• Fanapt: First 6 months of 2025 net product sales were $52.8 million, a 21% increase from $43.7 million in the same period of 2024. Second quarter 2025 net product sales were $29.3 million, a 27% increase from Q2 2024. Fanapt total prescriptions in Q2 2025 increased ~24% vs Q2 2024 and 13% vs Q1 2025. New-to-brand prescriptions increased over 200% vs Q2 2024 and 50% vs Q1 2025.
• HETLIOZ: First 6 months of 2025 net product sales were $37.1 million, a 4% decrease from $38.8 million in the same period of 2024. Second quarter 2025 net product sales were $16.2 million, a 13% decrease from Q2 2024. Continues to retain majority market share despite generic competition, but impacted by inventory stocking at specialty pharmacies.
• PONVORY: First 6 months of 2025 net product sales were $12.7 million, an 18% decrease from $15.4 million in the same period of 2024. Second quarter 2025 net product sales were $7.1 million, a 18% decrease from Q2 2024 but a 26% increase from Q1 2025. Decrease vs Q2 2024 due to price decrease net of deductions, offset by higher volume; increase vs Q1 2025 due to increased volumes sold.

Guidance

• Vanda reiterates 2025 financial guidance: Total revenue from Fanapt, HETLIOZ, PONVORY between $210M and $250M (6%-26% growth vs 2024). Year-end 2025 cash $280M to $320M. Revenue expected to be back weighted with Fanapt and PONVORY growth offset by potential HETLIOZ decline. Cash guidance reflects investments in R&D and commercial efforts to drive future growth.

Risks

• HETLIOZ: Variability in revenue due to generic competition and inventory stocking at specialty pharmacies, potentially leading to significant revenue decline.
• PONVORY: Variability in revenue due to dispute over gross-to-net adjustment related to ~$3M recognized in 2024.
• Forward-Looking Statements: Uncertainties associated with clinical trial outcomes, regulatory approvals, and commercialization progress pose risks to forward-looking financial projections.

Question and Answer

• Q: Raghuram Selvaraju on Bysanti commercialization and PONVORY dispute A: Mihael noted Bysanti could be ready to launch by Q3 2026 if approved by end-Feb 2026, with existing Fanapt sales force transferable. Kevin stated PONVORY dispute relates to gross-to-net adjustment on ~$3M recognized in 2024, and PONVORY growth expected to be steady due to sales force build-out and market adoption.
• Q: Olivia Brayer on Bysanti review and MDD Phase III A: Mihael said Bysanti review ongoing with no major issues, and FDA generally prefers two Phase III studies for MDD but bipolar I was approved on one study. Kevin discussed Medicaid impact on revenue, noting potential gross-to-net favorability for Bysanti vs Fanapt.
• Q: Andrew Tsai on Bysanti NDA type and MDD efficacy A: Mihael explained Bysanti NDA is (b)(1) as FDA requested, based on bioequivalence studies. For MDD Phase III, efficacy is measured by statistical superiority over placebo, with results expected in 2026.
• Q: Lin Tsai on DTC campaign A: Mihael stated DTC campaigns for Fanapt and PONVORY are ongoing, with investments continuing to support commercial programs, and campaigns expected to plateau but continue as effectiveness is evaluated.