Axsome Therapeutics (NASDAQ:AXSM) held its first-quarter earnings conference call on Monday. Below is the complete transcript from the call.
This content is powered by Benzinga APIs. For comprehensive financial data and transcripts, visit https://www.benzinga.com/apis/.
View the webcast at https://event.choruscall.com/mediaframe/webcast.html?webcastid=tczjFX9Q
Summary
Axsome Therapeutics Inc reported strong financial growth, with total revenue for their three marketed products reaching $191 billion, a 57% increase year-over-year.
The company received FDA approval for Ovelity for treating agitation in Alzheimer’s disease, marking a significant milestone.
The company expanded its sales force and improved coverage for their products to support continued growth.
Forward-looking statements highlight the planned expansion of their pipeline, including new trials and submissions for regulatory approval.
Management expressed confidence in achieving robust growth and updated peak sales estimates, forecasting Ovelity to potentially generate at least $8 billion in annual revenue.
Operating expenses increased due to product launch preparations and sales force expansion, but the company expects revenue growth to outpace these costs.
Axsome Therapeutics Inc ended the quarter with $305 million in cash, supporting operations into cash flow positivity.
Full Transcript
OPERATOR
Good morning and welcome to Axsome Therapeutics Inc first quarter 2026 earnings conference call. My name is Kevin and I’ll be your operator for today’s call. At this time all participants are in listen only mode. Later there will be a question and answer session and instructions will be given at that time. Please note this call is being recorded. I will now turn the call over to Ashley Dong, Senior Director of Investor Relations. Ashley, please go ahead.
Ashley Dong (Senior Director of Investment Relations)
Thank you. Good morning and thank you for joining Axsome Therapeutics Inc’s first quarter 2026 earnings conference call. With us today are Dr. Ario Tabuto, our Chief Executive Officer, Nick Pizzi, our Chief Financial Officer and Ari Maisel, our Chief Commercial Officer, who will begin our call with prepared remarks. Mark Jacobson, our Chief Operating Officer and Hunter Murdock, our General Counsel will also be available for Q and A. Please note that today’s discussion includes forward looking statements regarding our financial performance, commercial strategy and operational plans, including research, development and regulatory activities. These statements are based on current expectations and assumptions and are subject to risks and uncertainties that may cause actual results to differ materially. Please refer to our SEC filings, including our quarterly and annual reports, for a description of these and other risks. You are cautioned not to rely on these forward looking statements which are made only as of today and the company disclaims any obligation to update such statements. And with that, I’ll hand it over to Ariel.
Ario Tabuto
Thank you Ashley and good morning everyone. In the first quarter of 2026, Axsome delivered strong year over year growth and execution across the business. This performance was driven by our commercial products and the advancement and expansion of our R and D pipeline which is now composed of six innovative, potentially first in class or best in class product candidates. Starting with our commercial business, total revenue for our three marketed products was $191 billion representing year over year growth of 57% driven by Ovelity and Cenozzi with contribution from Simbravo. Building on the strong clinical profile of our marketed products in the quarter, we substantially expanded the sales force for Ovelity, finalized plans for the expansion of the Simbravo sales force and increased covered lives and quality of coverage for all of our marketed products. These initiatives will support continued strong revenue growth of the base business this year and beyond. Last week we received FDA approval of availability for the treatment of agitation associated with Alzheimer’s disease, an indication which received FDA Breakthrough Therapy designation and priority review. This approval introduces a first in class treatment option for this highly prevalent, debilitating and critically underserved neuropsychiatric condition. As such, it marks an important milestone for the millions of patients living with Alzheimer’s disease, their families and their caregivers. Ovelity has now been approved in two indications that received FDA Breakthrough Therapy designation and were granted FDA Priority Review. The approval in Alzheimer’s disease agitation combined with the health of the MTD business and the recent augmentation of the Ovelity commercial infrastructure provide us with a clear line of sight to Ovelity’s market potential. ARI will provide an update to our peak sales estimate for the Ovelity franchise based on these developments. The approval in Alzheimer’s disease agitation is a testament to our research and development productivity. Since the start of this year we have continue to advance and expand the rest of our industry leading pipeline with a focus on developing first in class and best in class products. On the regulatory front. Following the FDA approval of Ovelity last week, we are pleased to share that we have submitted Our NDA for AXS12 for the treatment of cataplexy and narcolepsy. Clinically, our ongoing trials continue to progress and we will be starting multiple phase 3 trials within the next few months. Finally, we recently expanded our pipeline further with the addition of AXS20, a potentially first in class pre phase 3 PDE10A inhibitor for schizophrenia and Tourette Syndrome. I will discuss each of these developments in detail later in the call. All in all, Axsome is advancing the commercialization of three differentiated marketed medicines across four highly prevalent indications, as well as an innovative pipeline of potentially first in class and best in class medicines that includes six product candidates targeting 10 different highly burdensome conditions in psychiatry and neurology. Looking ahead, Axsome is well positioned to realize robust growth driven by execution across our commercial portfolio, the long term ability in Alzheimer’s disease agitation and the advancement of the rest of our neuroscience pipeline. With that, I’ll hand the call over to Nick to review our financial results for the quarter.
Nick Pizzi (Chief Financial Officer)
Thanks Dario and good morning everyone. Our financial performance in the first quarter was strong with our three commercial products delivering continued double digit revenue growth. Total revenue for the quarter was $191.2 million, a 57% increase compared to 1Q25. We expect revenue growth to continue in 2026. Ovelity achieved net product revenue of $153.2 million in the quarter, up 59% compared to the first quarter of 2025. The Cenosi net product revenue for the quarter was $33.9 million, a 34% increase compared to the first quarter of 2025. Cenosi revenue consisted of $32.6 million in net product sales and $1.3 million in royalty revenue associated with CECenosi sales in out licensed territories. Net sales for Simbravo were $4.1 million in the quarter. Ovelity and CENOS gross to net Discounts for the first quarter of 2026 were both in the low to mid-50s range. We anticipate the gross and net discounts for both products to improve throughout the year consistent with prior year trends. Cimbravo gross net discount for the quarter was in the high 70% range and we continue to expect it to remain elevated over the near term as access continues to evolve and awareness continues to build. Turning now to expenses, total costs of revenue were $14.7 million compared to $9.8 million for the first quarter of 2025. Our research and development expenses were $52.7 million in the quarter compared to $44.8 million for the first quarter Of 2025. The increase in R and D spend primarily reflects a one time acquisition related expense booked in the quarter. Our selling, general and Administrative expenses were $185 million for the quarter compared to $120.8 million for the first quarter of 2025. The increase was primarily driven by the acceleration of prelaunch activities for Ovelity in Alzheimer’s disease agitation and commercialization activities for Ovelity which included the National Direct to consumer advertising campaign and Salesforce expansion along with commercial activities for some Bravo. Net loss for the quarter was $64.5 million or $1.26 per share compared to a net loss of $59.4 million or $1.22 per share for the first quarter of 2025. The $64.5 million net loss in the quarter includes $23.4 million in stock based compensation expense. Our balance sheet remains strong. We ended the first quarter with $305 million in cash and cash equivalents compared to $323 million as of the end of last year. Our overall financial performance reflects continued top line revenue growth and improving operating leverage driven by disciplined commercial execution. We anticipate that our current cash balance is sufficient to fund our operations into cash flow positivity based on our current operating plan. And with that I’d like to turn the call over now to Ari who will provide additional details on the key drivers behind our medicines and the broader commercial performance of the business.
Ari Maisel (Chief Commercial Officer)
Thank you Nick the first quarter of 2026 was a pivotal period for Axiom’s brand reflected an ongoing demand for our medicines, meaningful improvements in payer coverage and salesforce expansion activities. Our promotional efforts across HCP and patient audiences, combined with a broadening commercial infrastructure will support Axome sales objectives throughout 2026. Starting with Ovelity, more than 223,000 prescriptions were written in the quarter, representing 35% year over year growth and remaining consistent with the prior quarter. By comparison, the antidepressant market grew 1% year over year and declined by 1% compared to Q4 2025. Ovelity performance in the quarter was highlighted by a continued shift toward earlier line use, with first line first switch prescriptions increasing to 56% of overall demand. Primary care adoption also expanded in the quarter, now representing 35% of total ovelity prescribers. These trends reflect meaningful improvements in market access over the last two years, broadened awareness of the brand driven by our national direct to consumer campaign and our concentrated effort in expanding use among primary care providers, a key driver of earlier line utilization and an important foundation to support early trial in connection with the upcoming Alzheimer’s disease agitation launch. Additionally, more than 5,500 new prescribers were activated in the quarter, bringing the total number of unique prescribers for Ovelity since launch to approximately 60,000. We continue to make important progress with formulary access for Ovelity. Commercial coverage is at 78% and alongside Medicare and Medicaid coverage at 100%. Total coverage is now at 86% of all lives across channels, establishing a strong foundation of access for Ovelity in advance of the launch in Alzheimer’s disease agitation. We expect both the quantity and quality of coverage to continue to expand and improve. Ovelity’s growth to date in the depression market continues to reflect its compelling clinical profile highlighted by rapid and durable symptom improvement and a distinctly favorable safety and tolerability profile. Last week’s FDA approval of Ovelity as a treatment for agitation associated with dementia due to Alzheimer’s disease is a significant advancement for patients and a major milestone for the brand. We are very pleased with the product label which provides compelling clinical information regarding Ovelity’s impact on agitation for Alzheimer’s patients. Ovelity is a first in class treatment for this patient population demonstrating rapid and durable symptom improvement with a favorable safety and tolerability profile. Ovelity is the only approved treatment for Alzheimer’s disease agitation with efficacy on symptom relapse death demonstrated in long term trials in a short term study. The most Common adverse reactions were dizziness and dyspepsia and only 1.3% of patients discontinued treatment due to an adverse reaction, the same rate as placebo in market research. HCPs rate ovelity’s clinical profile in Alzheimer’s disease agitation as highly compelling from both an efficacy and safety perspective with clear potential for first line use in appropriate patients. We are expanding the all validity sales team to approximately 630 representatives enabling Axome to reach 68,000 HCP targets across primary care, psychiatry, neurology and geriatric specialists who treat both MDD and Alzheimer’s agitation patients across community and long term care settings. Our expansion efforts are substantially complete, positioning us well for the commercial launch in June. We believe Ovelity has the potential to play a significant role in the treatment of Alzheimer’s agitation and together with the MDD indication further broadens its use across serious neuropsychiatric conditions. Ovality’s expanded sales force and strong foundation of coverage position the brand to drive growth across both indications throughout the second half of 2026. Taking into account the recent label expansion in Alzheimer’s disease agitation, the clinical profile in this indication, the health and trajectory of the MDD business and recent investments in our sales infrastructure, we are now able to update our peak sales outlook for the product. We now believe Ovelity has the potential to generate at least $8 billion in annual revenue at peak with approximately equal contribution from each indication over the extended life of the product. We see a clear path to achieving this growth potential supported by the underlying fundamentals of the business as we continue to scale. Turning now to Simbravo, more than 17,000 total prescriptions were written in the quarter representing 36% growth versus Q4 2025. More than 5,000 new patients started Simbravo treatment in the quarter. Neurology specialists accounted for approximately 60% of total writers in the quarter with primary care representing approximately 32%, an increase from 20% in the first quarter of launch. While headache specialists will remain a critical prescriber segment for Simbravo, the increase in primary care prescribing is an encouraging signal of Simbravo’s potential and reinforces the early experience with Simbravo as a safe and tolerable acute migraine treatment that provides fast migraine pain improvement sustained through 24 and 48 hours. Based on Simbravo’s growth within its launch year and increasing demand for education of the only branded multi mechanistic acute migraine treatment in the market, we are increasing the Simbravo sales team by approximately 50 representatives. Our expanded Simbravo sales force of 150 representatives will support broader reach in the primary care market while deepening engagement with headache specialists and neurologists throughout the country. We are also pleased to announce a major commercial payer contract for Simbravo, effective this month, securing coverage for approximately 17 million lives. The agreement reflects Simbravo’s compelling clinical profile and its potential to address the needs of patients with inadequate response to triptans. Overall payer coverage for Simbravo is approximately 57%, representing 56% in the commercial channel and 57% in government channels. We expect coverage for Simbravo to expand and evolve throughout 2026 and finally, in Q1, approximately 54,000 Cenoze prescriptions were written, representing 16% year over year growth and a 3% decline sequentially. By comparison, the wake promoting agent market grew 1% year over year and declined by 5% versus Q4 2025. Nearly 500 new clinicians prescribed Cenozy in the quarter, bringing the total cumulative prescriber base to more than 16,500 since launch. Payer coverage for Cenozy remains steady at approximately 83% of lives covered across channels. Overall, the first quarter of 2026 was marked by significant progress across Axome’s commercial business, including strong demand for our products, key advancements in market access, launch preparations for ovality and Alzheimer’s disease agitation, and disciplined organizational growth designed to maximize the potential of our singular CNS portfolio. Looking ahead, ACSUM is well positioned to deliver on our commercial objectives across our innovative portfolio through the balance of the year. We look forward to sharing our continued progress with you over the coming months. I will now turn the call back to ARIO to discuss our singular CNS pipeline.
Ario Tabuto
Thank you Ari. I will now touch on recent developments and upcoming milestones for the rest of our pipeline, starting with AXS12. As I mentioned, we recently submitted our NDA for AXS12 for the treatment of cataplexy in patients with narcolepsy. Narcolepsy is a rare and debilitating neurological condition that affects approximately 185,000 people in the U.S. we are excited by the potential of AXS12 to provide a new and differentiated treatment option to patients living with narcolepsy. We look forward to announcing the FDA’s decision on the acceptance of the filing. Beyond AXS12 and narcolepsy, we are also developing the full suite of clinical programs in our leading neuroscience pipeline. Starting with AXS05. We we are on track to initiate a pivotal phase 2.3trial in smoking cessation this quarter. Moving on to Solriamfetol, our phase three programs for this molecule continue to progress. These include adhd, binge eating disorder, MDD with symptoms of excessive daytime sleepiness and excessive sleepiness, and shift work disorder for adhd. We are on track to initiate two pediatric phase three trials, one in children and one in adolescents this quarter. For mdd, we recently initiated the Clarity study, a phase three double blind placebo controlled randomized withdrawal trial. In the trial, patients who achieve a sustained response during the open label period will be randomized to continue Solrian Vetol or switch to placebo. The primary endpoint of that trial is is time to relapse the depressive symptoms with binge eating disorder. Our Engage Phase 3 double blind randomized controlled trial is …
This post was originally published here
